Southern California Gas Co. (SoCalGas) has unveiled a "transaction-based" storage program that allows customers to arrange one storage transaction at a time and to negotiate storage fees.The program was approved by the California Public Utilities Commission in November. Previously, most storage customers had to choose between basic, long-term, or auction services, which required differing storage commitments that ranged from a few months to 15 years. Storage fees also ranged from fixed tariff rates to negotiated rates.
Peter Yu, SoCalGas storage products manager, expects the new service will be popular with marketers and investment houses: "They try to buy gas at lower prices and then use our storage fields to hold the gas while they wait for the price to go up. ... [O]ur customers who want flexibility to price hedge can sign up at any time, with durations ranging from one month to three years."
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