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Schedule 1-2
Sheet 37 of 47
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KA-18903
-------
Schedule 1-3
SUMMARY OF ELECTRIC UTILITY PUI CHASES OF NATURAL GAS BY TYPE 0^ SUPPLIER
1973
(Billions of Cubic Feet)
From Interstate Pipelines
Region
State
New England
Massachusetts
Rhode Island
Vermont
Appalachian
Delaware
Kentucky
New Jersey
New York
Ohio
Pennsylvania
Virginia
Southeast
Alabama
Florida
Georgia
North Carolina
South Carolina
Tennessee
Great Lakes
Illinois
Indiana
Michigan
Wisconsin
Northern Plains
Iowa
Minnesota
Nebraska
South Dakota
Mid Continent
Kansas
Missouri
Oklahoma
Gulf Coast
Arkansas
Louisiana
Mississippi
Texas
Rocky Mountain
Colorado
Montana
Utah
Pacific Southwest
Arizona
California
Nevada
New Mexico
Inter-
departmental
Transfers
(1)
1.8
1.8
--
78.3
0.6
7.7
13.3
46.8
6.6
2.0
1.3
T-
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21.7
4.8
6.8
10.1
60.6
40.4
20.2
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2.7
2.1
0.6
5.5
5.5
~
0.3
0.3
193.4
193.4
Direct
Purchase
(2)
33.9
0.8
33.1
__
2.7
1.6
1.1
21.5
2.9
1.3
17.3
81.9
69.6
10.3
2.0
205.7
44.7
98.0
43.0
20.0
38.5
38.5
55.9
46.7
9.2
Indirect
Purchase
(3)
3.8
3.3
n/ .
0.5^
5.5
0.2
4.4
0.9
55.3
1.5
2.7
30.2
0.9
6.3
13.7
63.6
24.8
o.id/
30.5-
8.2
60.5
7.8
21.2
28.9
2.6
65.4
28.3
37.1
5.2
1.1
4.1
17.1
16.2
0.9
210.5
n/
168.5
39.2
2.8
From Intrastate Pipelines
Inter-
departmental Direct Indirect
Transfers Purchase Purchase
(4) (5) (6)
_.
__
__
__
__
_
__
,
15.7 298.1 7.9
15.7 29.3 7.9
v,/
268.8^'
1,496.4
244.5
1,251.9
0.9 2.8
0.9
2.8
59.7 33.1 U. L
59.7 11. 1
33.1
From
"reducers
(7)
~
110.1
110.1
3.5
3.5
29.9
3.6
20.3
6.0
26.0
8.9
17.1
Other Total
(8) (9)
5.6
5.1
a I
0.5^'
83.8
0.8
7.7
17.7
46.8
7.5
2.0
1.3
199.3
2.3
145.9
30.2
0.9
6.3
13.7
88.0
31.2
6.9
30.5
19.4
142.6
51.1
42.7
46.2
2.6
475.2
156.4
48.0
270.8
0.2 ,1,742.9
0.2- 48.5
369.4
47.1
1,277.9
59.6
55.0
0.9
3.7
1.7 591.4
46.7
441.6
39.2
1 7- ".9
Pacific Northwest
Oregon
Total United
States
364.3
440.1
489.3
76.3
I, 830. 4 11.0
169.5
2.4
2.4
1.9 3,390.8
Note: Data excludes refinery and blast furnace gas.
a/ Canadian imports.
b/ 261.6 of the 268.8 Bcf burned In Oklahoma was tn plants which wrre supplied partially or totally by systems
owned and operated by the plants parent company.
£/ Further breakdown not obtainable.
d_/ A small amount of gas burned by electric utilities in Michigan was produced within that state. The escact
amount of this intrastate gas is not known, but is estimated to be less than 5 percent of the states fotal
consumption for 1973 sin-e only 47.8 Bcf was produced in Michigan in 1973, about 5.2 . -c,t of the slates
total gas consunption in 1973 (906 Bcf).
n/ Negligible.
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hoot
of
El Paso Natural Gas Company
Gas Curtailment Proceedings
El Paso Natural Gas Company, one of the largest inter-
state gas pipelines, sells gas for resale to local gas dis-
tributors and makes direct industrial sales (main line arid
field sales) in the states of Texas, New Mexico and Arizona,
It sold for resale over 74 percent of its 1973 annual sales
at the Arizona-California border to Southern California Gas
Company and Pacific Electric and Gas Company for local
distribution and resale within California. El Paso makes
one sale for resale to an interstate pipeline in Nevada and
minor field sales in Oklahoma and Colorado. I/ The company's
1973 sales were divided as follows:
EL PASO NATURAL GAS COMPANY
1973 SALES
(billions of cubic feet)
Service Class
Sales for Resale
Retail Industrial Sales
Total Sales
Percent
California
988.1
988.1
74.1%
East of
California
223.9
121.9
345.8
25.9%
Total
1212.0
121.9
1333.9
100.0%
In response to the policies expressed by the Commis-
sion, _2/ El Paso _3/ on July 6, 1971 filed proposed changes
in its FPC Tariff to become effective on August 6, 1971 to
establish "measures to assure as reliable and adequate
service to its customers as present natural gas supplies and
pipeline capacity will permit." 4/ The Commission suspended
the tariff filing -- the proposed curtailment of service
I/
I/
4/
Prior to January 1974, El Paso also supplied Northwest
United States with natural gas through its Northwest
Division. By U.S. Supreme Court order the Northwest
Division was divested and sold to a new pipeline,
Northwest Pipeline Corporation.
Order No. 431 in Docket No. R-418, issued April 15, 1971,
The Southern Division of El Paso.
Order Suspending El Paso's tariff filing in Docket No.
RP72-6, issued August 5, 1971.
-------
Schedule 11-3
Sheet 2 of 10
plan -- for the full five months allowed under the Natural
Gas Act, until January 6, 1972.
El Paso in its filing did not allege any immediate gas
shortage for the Winter 1971-1972 but referred to the firm
capacity of its pipeline system; 3.9 Bcf per day in the
winter and 3.8 Bcf per day in the summer which would be
apportioned under the curtailment plan by the historical
usage patterns of its resale and direct customers.
Under this plan no curtailment of California customers
would take place until all East of California (EOC) service
had been curtailed. Hearings on the matter were held before
a Presiding Law Judge in late 1971 and were completed in the
summer of 1972.
However, on August 17, 1972 El Paso requested a Commis-
sion order prescribing interim emergency curtailment rules
for a period from November 1, 1972 until a final order would
be issued on its permanent curtailment plan. The hearing
record was reopened to receive evidence on the need and the
form of an interim plan. El Paso introduced evidence of a
gas supply shortage !_/ and proposed an end-use plan which
would still cut off completely the EOC customers, including
residential service, before any curtailment of the Califor-
nia sales.
On October 31, 1972, the Commission prescribed in
Opinion No. 634 an interim curtailment plan for one year or
until a permanent plan was established for El Paso, which-
ever event occurred first. The Commission revised its
interim plan on December 15, 1972 in Opinion No. 634-A and
on February 7, 1973 made further changes for clarification.
The plan was finally made part of El Paso's tariff in March
1973 and according to recent orders of the Commission in
December 1974, will remain in effect through March 1975.
The interim curtailment plan provides the following
service priorities for deliveries on any day that curtail-
ment is needed:
jLi. Residential, small commercial (less
than 50 Mcf on a peak day) and resi-
dential needs associated with indus-
trial requirements served directly or
indirectly.
I/ 1973 Actual curtailments reported to the Commission.
in El Paso's annual report of gas supply (Form 15)
were 117.3 Bcf or 8.1 percent of 1973 gas requirements.
59
-------
-.-:;hedul
Sheet 3
II 5
of :_0
Priority 2
Large commercial requirements
dustrial requiiements '
*ection. feedstock and
and in
or plant pre-
process needs
industrial requirement:; i.T-t specified
"-_..' _*_ " __ _ "» ^ -1 i-
in Priorities 2, 4
arid 5
Priority 4.
Priority
Industrial requirements for boiler fuel
use at less than 3,000 Mcf per day, but
per day, where
more than 1,500 Mcf
existing
present.
alternate fuel facilities are
Industrial requirements
(in excess of 3,000 Mcf
fuel use where existing
facilities are present.
for large volume
per day) boiler-
alcernate fuel
The Commission interpreted "requirerneuts" as used above
to mean the total deliveries scheduled (i.e., requested) by
El Paso's customer on apy day of curtailment but not mor'
than El Paso's maximum aaily delivery obligation under the
sales contract with the customer. Also, the Commission
interpreted deliveries for gas turbine fuel as not being
"boiler fuel" and hence to be supplied under Priority 3.
Furthermore, the Commission allowed deviations from the
curtailment procedure when required by environmental prob-
lems.
Since the two California customers of El Paso also pur-
chase gas from other pipelines and from local producers in
addition to the supplies obtained from El Paso they are con-
sidered partial requirements customers. EOC customers, in
general, purchase all of their gas requirements from El Paso
and would be considered full requirements customers. To
clarify the interim curtailment procedures the Commission
found that:
El Paso
and par
in that
bear a
tion to
markets
. . . the
daily b
ments I
supplie
shall, however, curtail both full
tial requirements customers equitably,
partial requirement customers shall
ratable share of curtailment in rela-
El Paso's proportio ;ate share of the
they serve. El Paso should explain
procedures used to determine on. a
as is the p.-rcentage o.F total require-
n each pilority classification HI Paso
s to its oartial req?> irt-ment customers,
-------
Schedule 11-3
Sheet 4 of 10
The Commission disallowed the grouping of delivery
points for curtailment purposes; i.e., instead of using the
total daily delivery to a customer El Paso was required to
apply the curtailment percentage to each separate metering
point at which portions of the total daily volume are de-
livered. The Commission's reasons were that grouping of
delivery points would be discriminatory against customers
with a single delivery point, e.g. California; and that
grouping would allow gas to be delivered for lower priority
consumption by those customers having several delivery
points. The question of grouping, however, was set for
further hearings and evidence.
The Commission set annual limitations on the total
quantities of gas to be taken by EOC distributors and indus-
trial customers since their contracts do not provide for
such limits. The volume of gas taken during the 12 months
ending June 30, 1972 plus any curtailments was chosen as the
ceiling. Because the gas shortage is directly related to
the annual volumes El Paso is able to obtain from its gas
supply sources (which were declining each year) the effect
of the EOC annual volume ceilings was to hold the supply
status at 1972 levels. The California customers by virtue
of El Paso's daily contract demands with them were being
held to 1972 annual volume ceilings, i.e. to no more than
365 times the daily contract demand which could not be
increased during the shortage.
Finally, the Commission reiterated its expectation that
a full environmental record would be obtained in the hear-
ings on a permanent curtailment plan for El Paso.
As discussed heretofore, the Commission on January 8,
1973 issued its General Policy Statement, Order No. 467 in
Docket No. R-469 (as revised by Order Nos. 467-A and 467-B)
establishing as a criterion for pipeline service curtail-
ments during the gas shortage, nine priorities of service.
The lowest priorities, 6 through 9, were set for interrup-
tible service.
In its interim curtailment plan for El Paso, the Com-
mission deleted reference to interruptible service, thus
giving to firm and interruptible industrial service the same
priority during curtailment. The deletion of interruptible
service results from a long-standing California utility law
that requires all customers of California gas distributors
who are supplied with more than 200 Mcf per day to be
subject to .nterruption of supply and to maintain alternate
fuel supplies. No such state requirement is applicable to
-------
Schedule 1
Sheet 5 of
the EOC customers of El Paso,
The effect of the nine priorities plan would then be r;o
put the firm industrial customers of the EOC distributors
and the industrial customers of El Paso in Priorities 3 to
5, and the large California customers, industrial and com-
mercial, in Priorities 6 through 3, although the California
customers by that state's iaws were not allowed to recei'/e
firm service. The Commission's judgement was that the
regulatory policy of California has influenced the develop-
ment of contractual relationships on the El Paso s/stem and
would result in inequities between EOC and California custo-
mers taking gas for the same end-use dr.ring periods of
curtailment.
For these reasons, the Commission made no distinction
between firm and interruptible industrial service in Prior-
ities 3, 4 and 5 of its interim plan for El Paso and placed
large commercial requirements in Priority 2 whether firm or
interruptible service is provided.
On June 5, 1973, the Presiding Judge issued the initial
decision on the permanent curtailment plan for El Paso. On
September 19, 1973 the Presiding Judge issued the initial
decision on whether grouping of delivery points should
be allowed in computing a customer's gas ntitlements during
curtailment under the permanent plan. The Presiding Judge
proposed a 10-priority of service plan in his June 1973
decision that included lower priorities for interruptible
service than for firm service. The Judge also approved
grouping in his September decision. The matters now moved
to the Commission for final decision.
On October 18, 1973, the Commission extended the life
of the interim plan which would have expired on October 31
pending further action of the Commission on a permanent
plan.
On January 21, 1974, the Court of Appeals. D.C. Cir-
cuit, affirmed in part and reversed and remanded in part the
Commission's interim curtailment plan. The interim plan was
to be continued in effect for a reasonable period pending
Commission action on the remand. The Court questioned (1)
assignment of the boiler fuel usage \Q the lowest priority
of service (2) assignment of annual limitations to the EOC
full-requirements customers on actual gas deliveries and io
the California partial requirements customers on contract
entitlements, and (3) the Commission's elimination of group-
ing of delivery points.
62
-------
Schedule II-3
Sheet 6 of 10
On June 14, 1974, the Commission in Opinion No. 697
prescribed a permanent curtailment plan for El Paso and also
complied with the Court remand. Essentially, the permanent
plan is the interim plan with two significant modifications,
(1) addition of customer underground storage injections to
the other requirements in Priority 2 of the interim plan and
(2) a change in Priorities 4 and 5 with respect to alternate
fuels from "where alternate fuel facilities are present" t£
"where alternate fuel capabilities can meet such [boiler
fuel] requirements."
The second change is of considerable importance. Under
the interim plan customers that did not have available
alternate fuel facilities to provide a substitute for gas
used for boiler fuel were given Priority 3 service during
curtailment -- all deliveries in Priorities 5 and 4 would be
cut off before Priority 3 customers were curtailed.
Under the permanent plan, these Priority 3 users will
be placed in Priority 4 or Priority 5 depending upon the
size of the boiler fuel requirements. The test as between
Priority 3 and the lower priorities depends only on whether
alternate fuels if obtainable by the customer can meet the
boiler fuel requirements -- it presumes that the customer
will install the necessary facilities and make timely con-
tract for an adequate supply of alternate fuels.
The Commission complied with the D.C. Court of Appeals
three part remand by (1) defending its boiler fuel low
priority on the grounds that alternate fuels could be more
easily obtained to substitute for gas boiler fuel sales; (2)
that air pollution resulting from the use of alternate fuels
could be more efficiently and economically controlled since
the installations of the boiler fuel users would be of large
size, e.g., power plants; and (3) that by first curtailing
boiler fuel gas sales the evidence showed that displacement
of gas could be maximized with a minimum of economic dis-
ruption and dislocation.
On the second question, the annual volume limitations
imposed on EOC customers vs. the daily contract entitlements
allowed California customers, the Commission pointed out
that both groups received the same treatment since the daily
contract entitlements of the California customers are equiv-
alent on an annual basis to their historic annual volumes,
i.e., the California customers take their total daily con-
tract volumes each day of the year.
On the third question, the Commission reversed its
63
-------
Schedule 11-3
Sheet 7 of 10
requirement in the inter.im plan and permitted grouping of
delivery points in the permanent plan, subject, to further
evidence in a remanded Commission proceeding.
In addition, the Commission decided the following
issues in regard to the permanent plan:
1. Changed the base period for annual volume
limitations from 12 months ending June 30,
1972 to 12 months ending October 31, 1972
as adjusted for the annualized effect of
attached Priority 1 and 2 gas loads exist-
ing on October 31, 1974.
2. Added penalties for unauthoiized overruns
of d'tily curtailment, up to 3 percent of
the tariff rate; o\rer 3 percent to 5 per-
cent - $2.50/Mcf; over 5 percent daily
overrun - $5.00/Mcf.
The annual volume limits are a necessary part of the
Federal and State contrDl of the impact of the national gas
supply shortage. In El Paso's service area, southwestern
United States and California, residential and commercial
space heating is minimal compared to the northern states
needs. Thus some load growth is permissible for residential
and commercial service but of necessity iu should be con-
trolled. In general, no new large industrial gas loads are
allowed.
Under both the interim and the permanent plans, El
Paso was allowed to by-pass the ordered curtailments during
immediate emergencies. Also, the Commission acted on ap-
peals of customers where longer term needs for additional
gas were claimed usually because alternate fuels were un-
available or unsuitable. Examples of immediate emergency
situations are to protect electric service reliability and
to alleviate environmental emergencies so as to forestall
irreparable injury to life or property.
In Opinion No. 697, the Commission reiterated a con-
clusion reached in its order of August 22, 1972 I/ that
compliance with the National Environmental Act (NEPA)
_!/ Order denying notion to terminate the proceeding and
to require Commission Staff to prepare and circulate
an environmental impact statement. Docket No. RP72-6;
48 FPC371.
64
-------
Schedule II-3
Sheet 8 of 10
Section 102(2)(c) procedural requirements in curtailment
cases is "not meaningfully possible."
Applications for rehearing of Opinion No. 697 were made
by 16 intervenors in Docket No. RP72-6 including the State
of California, the California Public Utilities Commission
and the Air Pollution Control District of Los Angeles County.
Rehearing was granted August 5, 1974.
On December 19, 1974 the Commission issued Opinion No.
697-A which adopted the permanent curtailment plan pre-
scribed in Opinion No. 697 but provided for further hearings
in Docket No. RP72-6 on the sole issue of the environmental
impact of the permanent curtailment plan. The Commission
reversed its previous position and now determined that a
remand is necessary to comply with the procedural require-
ments of the NEPA. The Presiding Judge is authorized to
modify the curtailment plan as may be required by the environ-
mental evidence.
The permanent curtailment plan will become effective
upon acceptance by the Commission of El Paso's revised
tariff sheets publishing the Opinion No. 697 plan as modi-
fied by Opinion No. 697-A. El Paso is allowed up to 90 days
from December 19, 1974 to make the necessary tariff filings
or at the latest until March 19, 1975. Presumably the
permanent plan will become effective no latter than April
18, 1975 assuming the 30 days statutory notice of tariff
changes. The time table could be advanced by accelerated
action on the part of El Paso and the Commission. It could
be delayed by a Commission or a court stay.
For the Winter 1974-1975, it appears that the interim
curtailment plan will remain in effect except that in
implementing the plan on any day, El Paso shall permit the
grouping of delivery points to determine the total volume of
gas required and the manner in which the requested deliveries
are to be curtailed.
In addition to the chmges and clarifications in
Opinion No. 697 that established the permanent curtailment
plan, the Commission ma.le further classifications in regard
to implementation of the plan. These include:
1. Pipeline customer storage injections in
Priority 2 will be the total volumes of gas
delivered to underground storage during
period; the net volume to be multiplied
ihe ratio of total sales in Priorities 1
-------
Schedule Ir-3
Sheet 9 of 10
and 2 to total :,ales for all priorities dur-
ing the winter season. This storage formula
is instituted Co prevent assignment of Prior-
ity 2 to storage volumes that may be used for
lower priority services.
2. Gas used for fuel for gas turbines will be
considered a boiler fuel j.se in Priorit es
4 and 5 -- a change from the interim plan
which considered such use :\s a Priority 3
service.
A considerable part of Opinion 697-A is devoted to end--
use data that Ei Paso will collect from the customers (gas
distributors ard direct industrials) to establish (1) an
"end-use profile" for each customer showing requirements in
each service priority category, (2) the winter and summer
season base volumes and annual base load volumes by months
ending October 31, 1972, updated to October 31, 1974 for
Priority 1 and 2 salesloads on that date and (3) the esti-
mated total gas supplies available to El Paso for the coming
winter and s'immer seascis.
The estimated supply will be superimposed on the indi-
vidual "end-use profiles" to indicate the amount of gas
available to each customer for each of the five service
priorities during the coming winter and summer seasons.
The total pipeline system seasonal entitlements will be
reported to the Commission; a copy of El Paso's estimate of
each customer's seasonal entitlements by months will be
supplied to the customer to aid in scheduling his seasonal
takes.
The Commission in Opinion No. 697-A adjusted the unau-
thorized overrun penalties provided in Opinion No. 697
for takes in excess of allowable volumes on days of curtail-
ment to add a penalty for overrun of authorized winter or
summer season entitlements. Overrun solely for the pro-
tection of Priority i and 2 customers will not be penalized.
The Commission excluded from its alternate fuel capa-
bility definition JY propane and other gaseous fuels saying
that: ~
!_/ FPC Order Nos. 497, an-i 493A, Order Adapting Certa_in
PjL^^iJLJ.!??!?. J-? _^?_aJl4ar'''Lz? _.J;iI1(L^!'?_e_^Ja5-s ^ZZLE5JL-L?H§.»
is sued~~S"e"p"Femb₯r" 2T~" 19T3 "ITT'DocFelf~NoT' R-4 74.
66
-------
Schedule I[-3
Sheet 10 of 10
[I]t is essential that propane and other
gaseous fuels be excluded ... since as a
purely technical matter, propane or some
other gaseous alternate may be substituted
for practically all natural gas uses.
If propane and other gaseous fuels were included in the
definition of alternate fuel capability the Commission
indicated that no useful purpose would be served in that
virtually no industrial customer could qualify for exemption
from curtailment.
On page 11 of Opinion No. 697-A, the Commission sums up
its efforts to establish a permanent curtailment plan for El
Paso, as follows:
We believe that the administrative mechan-
ism here developed will give El Paso the
daily and seasonal operating flexibility it
needs to protect its high priority loads
while at the same time equitably stabilizing
growth on a system faced with continuing gas
supply shortages.
The permanent curtailment plan ordered by the Commis-
sion is shown below. It will be effective presumably on or
before April 18, 1975, subject to Commission or Court actions
to delay implementation.
EL PASO NATURAL GAS COMPANY PERMANENT GAS CURTAILMENT PLAN
PRIORITIES OF SERVICE TO GAS CUSTOMERS DURING DAILY CURTAILMENT
Priority 1
Residential, small commercial (less than 50 Mcf on a
peak day) .
Large commercial requirements (50 Mcf or more on a peak
day), industrial requirements for plant protection,
feedstock and process needs, and pipeline customer stor
age injection requirements.
All industrial re uirements not specified in Priorities
2, 4 and 5,
Industrial requirements for boiler fuel use at less
than 3,000 Mcf i^c day, but. more than 1,500 Mcf per
day, where alternate fui.'l capabilities can meet sucti
requi rement s ,
Priority 5^ Industrial requirements Cor i arge volume (in excess ot
3,000 Mrf per day) boiler fuel use where alternate fuel
. /i pa b i I 1 1 i e s c an men t r u i h re q u i r em en t s .
-------
Schedule IT-4
Sheet 1 of 9
Transcontinental Gas Pipe Line Corporation
Gas Curtailment Proceedings
Transcontinental Gas Pipe Line Corporation (Transco)
owns and operates an integrated gas pipeline system that
starts in southeast Texas, crosses 10 southern and eastern
states, and ends in the New .'ork City arsa, Transco sells,
transports for others and stores natural gas. Sales for
resale were made in 1973 to 67 local gas distributors and
intrastate pipelines (90,3'o) and to 6 interstate pipelines
(9.71). Only O'ie direct industrial sale was made in 1973.
All of its natural gas supplies are purchased, about 3 per-
cent in 1973 fiom other interstate pipelines and the remain-
der from numerous independent gas producers located onshore
and offshore Louisiana and Texas.
Transco1s sales are made in 11 states but most of them
are made north of Georg a. The table below compares sal^s
for resale and direct sales by rate zones for the years 1970
through 1973.
TRANSCONTINENTAL GAS PIPE LINE CORF^RATION
GAS SALES YEARS 1970 - 1973
(Volumes in Billions of Cubic Feet)
Sales For Resale
Zone
Year
1970
1971
1972
1973
Zone 1: Georgia, Alabama, Mississippi, and Texas
Zone 2: Virginia, North Carolina, South Carolina
Zone 3: New fork, New Jersey, Pennsylvania, and Maryland
Source: Annual Reports, For-JD 2 cf Transco filed with
Federal Power Commission.
As the table shows, the total gas sales of Transco de-
clined about 74 Bcf between 1970 and the end cf 1973. The
decline was brought about by curtailments of gas sales under
curtailment plans filed with the Federal Power Commission
(Commission) at its request.
Zone
1
47.4
38.9
46.9
45.3
Zone
2
267.8
273.7
270.1
2.57.0
Zone
3
678.8
665.6
640.6
618.0
Total
994.0
978.2
957.6
920.3
Direct
Sales
4.1
3.0
3.3
3.1
68
-------
Schedule II-4
Sheet 2 of 9
There is an important feature concerning the composi-
tion of Transco's market which deserves some attention in
light of the complicated litigation history of Transco's
curtailment plans. Unlike most other pipelines, Transco
sells significant volumes of gas in markets with widely
divergent end-use gas consumption characteristics. Transco's
southern (zones 1 and 2) customers have traditionally sold a
significant portion of their gas to industrial concerns,
while Transco's northern customers have a higher proportion
of residential and commercial sales. Thus, end-use alloca-
tions have a significantly disproportionate impact on Transco's
customers ._!/
On May 17, 1971 Transco filed with the Commission re-
visions to its effective tariff to provide a curtailment
policy to be followed in the event of a gas supply short-
age. _2/ The curtailment plan went into effect May 29, 1971
after a one-day suspension by the Commission in Docket No.
RP71-118, to provide for public hearings. The plan provided
for across-the-board percentage (pro-rata) reductions in the
contract demands of the large customers to meet any supply
deficiencies. The 35 small customers, using 7,500 Mcf per
day or less, were exempted. The order of curtailment was
first, all sales nade to direct interruptible customers and
those made for resale under Transco's interruptible rate
schedules and thereafter, all firm direct sales and firm
sales for resale.
The plan made no distinction between the various end-
uses of the gas sold; e.g., boiler fuel use was not assigned
a low priority of service. Annual contract sales -- firm
service as to the 12 months contract total but not firm for
daily deliveries as contract demand service is -- were as-
signed 1/365 of the contract total as a daily volume sub-
ject to the precentage curtailment. The tariff rate credit
for failure to deliver contract demand on any day was not
allowed for gas shortage curtailments but was retained for
interruptions in deliveries for other causes
I/ This is, of couise, true of many pipelines, although
not to th is degree.
2/ Purstr nt to the Con-m i ^s j on ' c Order \"o. 431 in Docket
No. K- >i .3.
69
-------
Schedule 11-4
Sheet 3 of 9
During the period June 1 through July 4, 1971, Transco
imposed a 7 percent curtailment under the plan. The cur-
tailment ended with the ccrinection of7 a new limited-term gas
supply on or about July 1,
Hearings on the plan started :n September 1971 and re-
sulted in a settlement with the customers which the Commis-
sion approved to be effective from November 16, 1971 through
November 15, 1972. The settlement incorporated the initial
plan filed by Transco as described above but with some mod-
ifications. These included exemption from further curtail-
ment of any distributor or direct firm customer during the
winter period (.November 15 through April IS) who discontin-
ued all interruptible sales or in the case of nhe direct
customer uses of gas that could be interrupted. Exemption
volumes were to be "made up" by taking lesser volumes of gas
after the winter period so that the weighted average percent-
age of curtailment would be the same for all customers by
November 15, 1972. The demand charge adjustment (credit"
for a gas supply deficiency would be applicable during the
winter period -- this credit amounted to the monthly demand
charge divided by 30 and would be applied to the difference
in Mcf volume between the volume of gas requested by the
customer up to the contract demand and the volume that
Transco was able to deliver.
Also, at the end of the winter period the system-wide
average percentage curtailment would be computed. Any cus-
tomer curtailed greater than the system percentage would
receive 25 cents per Mcf payment by Transco for the excess.
Transco would be reimbursed for this credit and the above
demand charge credit by subsequent bills to the customers.
The compensation for over-curtaiIment was subsequently ex-
panded and has become a key controversy in the Transco
curtailment proceedings between the Commission and Transco
customers.
The Commission approved the interim curtailment plan
for the 12 months ending November 15, 1972 including a
condition that Transco file a permanent plan by January 17,
1972, wh^'ch would become effective 3n November 16, 1972.
Transco made the required filing -- a curtailment plan
similar to that in effect - which *:he Commission suspended
in Docket No. RP72-99 for f. ve Tiontis but with the under-
standing that it would net become effective until November
16.
However, after the hearings the customers and Transco
70
-------
Schedule II-4
Sheet 4 of 9
agreed to another interim plan to be effective from November
16, 1972 through November 15, 1975. The Commission approved
this plan on November 15, 1972.
The second interim curtailment plan included the basic
provisions of the previous plan, i.e., all interruptible
service by Transco to be first curtailed; exemptions allowed
from curtailment, entirely for small volume firm customers
and large customers exempted after all of their interrupt-
ible sales had been discontinued. Additional provisions
were a 25 cents per Mcf surcharge for exempted volumes and a
25 cents per Mcf credit for customers curtailed more than
the announced level of curtailment -- the debts and credits
to be accumulated in a deferred account which would be per-
iodically balanced by increases or decreases in Transco's
commodity rates. If the firm services of the customers
needed to be curtailed, end-use priorities were established
to protect human needs customers, the residential and com-
mercial users.
The Commission refused requests for a hearing on the
permanent plan until more experience was obtained on the
operation of the present form of curtailment. However, a
hearing on the permanent plan was not abandoned, the Commis-
sion said. The Conmission also denied the request of the
City of New York for preparation by the Commission of an
environmental in.pact statement by November 15, 1973 stating
that there was no basis for the impact statement.
In view of the .subsequent problems of the Commission
with Transco's curtailment plans it is of note that appro-
val of the second interim plan included Ij expansion of the
compensation feature from a 25c/Mcf credit for over-curtail-
ment volume to a balancing 25^/Mcf for under - curtailment
volumes and 2) while the pro-rata curtailment by contract
demands was continued, an end-use priority of service was
added if firm services were *o be curtailed.
The approved settlement agreement establishing a second
interim curtailment plan included an agreement by Transco to
file another curtailment plun by May 1, '973 to go into
effect after Commission suspension on November 16, 1973.
The eailii'r permanent plan ''iled January 17, 1972 was still
under suspension in. P-ockef \i-. R!'-7^-99'. On May 1, 1973
Transco rerj'u'st ^ u ti'at the Commission vxtend the second
interim r 1;. , for aaofhei /ua) to JoveT.Ser 15, 1Q?4. Transco
stated t h>; r il \-,\: ~< -,) r "i>a r i u ; to i c. > I -, <_ 1 maiket data so as to
file an end- ,'-< pia,' i <\ actcrJane. .. i f h ^rJi-r No. 16' of" the
Comm i s - i
-------
Schedule I[- 4
Sheet 5 of .-?
"find large disfavor" w i t h many of its cur- tornors .
On May 23, 1975 the Commission ordered Tr arise o to file
a permanent plan by July 1, 1973. Transco was specifically
advised to give consideration to Drier No. 467-B in deter-
mining a permanent plan. On June .'), I973 Transcc filed a
permanent plan which the Commission -aid was in substantial
compliance with Order 467-B but was suspended on July 30.
1975 for hearing and investigation, until November 16,
1973.
The Commission at the same time denied a second request
by Transco to keep the interim plan in effect for another
year.
Several o " Transco's customers and the North Carolina
Utilities Commission applied for rehearing of the denial of
extension of the interim curtailment plan and upon refusal
of the Commission took the matter to the District of Colum-
bia Court of Appeals. )n November 9, 1973, the B.C. Court
stayed the effectiveness of Transco's filing of the Order
No. 467-B end-use priorities which under the Commission's
order would have gone into effect November 16, 1973. Thus,
the second interim plan was allowed to remain in effect for
another year until November 16, 1974.
On November 2, 1973, the Commission in denying the re-
quest of the North Carolina Utilities Commission for a stay
of the effective date (November 16} of the Order 467-B plan
found that the second interim plan failed to meet the fun-
damental principles to be followed in any curtailment plan.
These are:
1) Curtailments should be based on end-use
rather than contracts.
2) Since large volume boiler fuel usage is
inferior, the curtailment of sales of gas
for it should precede the curtailment of
certain other industrial requirements.
LH.
3) Equal treatment should be provided to
direct and indirect (resale] customers.
Hearing in Docket No, RI-"2-99 or Transco's filing of
the Order 46"7-B type of curtailment ,.lan reconvened on Feb-
ruary 19, 1974. Op, February 16, COT.''-'1 i da ted Hdison Company
of New York requested that tho Presiding Judge assigned to
the hearing, ruquiie the Commission llaff to file a draft
72
-------
Schedule 11-4
Sheet 6 of 9
environmental impact statement. The Presiding Judge denied
the request and was upheld in the denial hy the Commission
on April 30, 1974 -- two of the five Commissioners dissent-
ing. Data on end-use of Transco gas was collected and made
part of the hearing record. The hearing was concluded June
25, 1974.
On September 30, 1974, Transco filed a motion with the
Commission for approval of an interim curtailment plan to be
effective from November 16, 1974 through November 15, 1975.
The plan was arrived at by general agreement of the parties
to the proceeding in Docket No. RP72-99.
On November 12, 1974, the Commission denied Transco's
motion stating that the proposed interim curtailment plan
was unjust, unreasonable, discriminatory and contrary to the
public interest. On November 26, 1974, the D. C. Court of
Appeals mandated that the interim curtailment plan as filed
on September 30 be made effective as of November 16, 1974
pending further action by the Commission. Any changes by
the Commission, however, would be subject to approval by the
Court. The latest interim plan provides: (1) for fixed
annual entitlements of gas for the 35 small gas customers of
Transco based upon recent requirements updated to July
1974 -- these will not be curtailed unless presently esti-
mated gas supplies deteriorate, j'2) for seasonal, winter and
summer, firm gas entitlements for the larger customers
(those with contract daily demands of over 5,000 Mcf). The
entitlements of the larger customers were determined in two
steps, first by estimating the available system gas supply
separately for each season and deducting the volume from the
sum of the historical seasonal requirements of the customers
to obtain the needed total --.easonal curtailments.
The total cuitajlment volume for each season was then
allocated among the customejs by two methods: 50 percent by
the historical contract requirements of each customer and 50
percent by the end-u.^e of e . h customer's historical re-
quirements arranged bs the nine service priorities estab-
lished by the Commission n Order 467 -B. The sum of the two
allocations is the total -e '.'/jial curtailment expected for
each customer hased upon Iran^co's gas supplies estimated as
of September 1, 19~4. TIv. seasonal curtailment thus obtained
was deducted ;;or; e.n. h cu.-. f ; : >e r ' historical requirements
for the 11; - i ',) ," S ;% inter :. ;; t .' v, i i 1 a b 1 c to t h e customer
du r i :ig C'!L h - -:, -uii .
'h
> e i v i c e
73
-------
Schedule f I - -1
Sheet 7 of f)
'. for p-.jrpo-'e:; of fur-
1 1 v~ . t : ons o f gas de-
o 5:r estimated gas
: :i gas supplies will
r:.ver-e ordei of the
-- ] and J are generally
p ori""ies. Priority 5
priorities 1, ." a:iJ ; ; o :
ther curtailment e - : o ; .:
pending upon decreases or
supplies, The- decrease ^ or
be allocated to the ci^Tc, :.
three service nr i o r i T : <. -;
the same as ^rJor \o. '(." - .
comprises the re:na i a; ;v: -e\-o:i jirioril if- of Order Xo. 467-B,
Transco estimated that" total gas supplies To?' the larger
customers of 5 1 " . 3 Be f w : 1 i 1-ir available tor the 'winter
period ending April 15, 19"S arid 595.5 Rcf for the summer
period starting Api il Id and ending November 15, 1975.
The follcivine, tabl'- ;> illustrative of the methods used
to spread the >. i: rt i i : ,::e;;t ..OPO'I.; Transce's larger customers.
The table assumes a hypothetical gas pipeline with three
customers, \, B and L whose contract requirements and end-
use prioritif? of servir iti'.s :
Priorities 1 through 5, >t- -r.r : ir^i :t--vLi
Prioritzi-as 6 through Q, I't-r^iru- intern.-,:-
ible service
50,000 25,000 25,000
2,500 2,500
6,000 _ ~-_
_ _
80,000 2/ 4]_,0_00 1 6, 500 22,500
'-(0
2/
Svstem total ..qual-,
74
-------
Schedule 11-4
Sheet 8 of 9
Transco'> ia t, s
expands the co'npcnsa
tomers for over nvi
with the system a\e;.
plan also pro\ide- !".
ments from one cu>:o>
conditions . The r,} <
i i\
,e cu: la , ;:'.ent
\ o 1 unl.i ry ' ,
; ; o ,: no* "c '
co'iteinp 1 11 e -
seek extraordi narv eiergency re lies'
provided under the Co-iimi ss i on ' s Order Xo. 467-C except after
a petition to Transco to arrange for release of gas as pro-
vided above.
i 1 .'.'Mii pi aii continues and
U . red its among the cus-
] curtailment as compared
o f a 1 1 customers. Th e
iwe of seasonal entitle-
r ) al le\ iate emergency
tint no customer will
fro..i the Commission as
The
who are
given a
the over
the syst
Transco
a 25 c e n
the wint
greater
rata and
Mcf char
winter s
provided
compensation
curtailed gre
b i 1J i ng ere di
- cu rta i line:1t
em average w L
for the under
t per Mcf ere
er sea soil eni
than the curt
50 percent 0
ge for the .in
eason '.-. i ! 1 be
under the nr
.\o
ie that customers
average will be
(_nts per Mcf for
;rt ailed less than
its per Mcf by
In addition,
.ment volumes for
:ustomers curtailed
the 50 percent pro-
A ?5 cent per
es during the
urtai1ed less than
46"-B basis.
The C'ornm i .-
settlement plan
features . 'i lie
stone" of the ^
to be cont rar y
that the transa
commerce \\ i 1 hout sv^!
in d without c eii it i^
The Court a> j, ,
placing the compcn.sa
proceedings befoie t
- j -ji, S
; , * ,
^ U I ; ' ' .
a r t a - 1
' u S c c
C t \ (^i~-
pi i"c
tiie .
'- i O ! : !
,:ViU -
, n ;
in
On Jan ,.ia i
Docket No.
ment plan in
f o r is suanc e
s i nee Trans' o
Septembe r
based j t h<. '>'>
gas suppiv ' t
ties C^i-!'1 '
1 option to the interim
t i o n dnd release gas
o tiuse as the " corner -
f,nd> compensation, etc.,
M" the Xataral Cas Act in
are sa^ts in interstate
. , .-. ].)ii a ue tiie public,
I'nder tfie Act.
t a;. ..M;,-Jfi!:e pr'ovjded for
i'-, . s c i j v\ n e rui i n « further
r, r'.''. r "d t h^ record
s i r. I;, r i P. curtail-
~4 arid to provide
t ate .fn r. , Also ,
: a t e J - i nc. e the
1 i! t ;. i i : [, 1 a n is
_' t ' i. ; f ra nsc :, ' s
; ' . , : : vi iitil i -
x i -: -pa ra f e
-------
Schedule II-5
Page ] of 7
M f.OMi'\NY
iiru-1-ruNGS
As shown on Schedule l, the United Gas Pipeline (United)
has experienced the largest curtailments because of short
gas supplies. United's pipeline system extends from Eastern
Texas to Western Florida. Natuial gas is sold to five major
interstate pipelines!'' for resale in the East and Midwest
United States, and to local distributors and mainline indus-
trial customers in Texas (6.8"), Louisiana (53.61), Missi-
ssippi (23.8%), Alabama (9.1°-) and Florida (6.4%). United
provides only firm service 'c its three kinds of customers.
The following table shous United's total gas supply by
sources arid its annual sales lor the four years, 1970 through
1973. The declining gas suopli.1, are reflected principally
in reduced or curtailed sales to Dnited's mainline industrial
customers and other pipelines.
Gas purchased
over 91 percent of
reserves on Janu iry
producer contract- n
feet in 1970 to "..~
ing complete exhaust
annual purchase i\ite
sources of producer
onshore and of;'-he re
United's gas >uppl^ ,
pipelines under :.
On October hi ,
revision t o i ts i 1 th
s e r v i c e t o b e i HIT ] e::.
ies . L'ni tod pe^o i ce i
1970-19"! «vLnt--T " he;
The th re c- o r i >; i : : -
nd
ende-nt producers accounts for
jii-ia' sepplie?. Remaining gas
respe',t,ve years under the
as-'d f om ^2.6 trillion cubic
euhiL feet in 1973 -- indicat-
i« ,..: -lv if taken at the 1973
ref : ' ' Tjf) by 1980. The
e i "! ea-L iexas, Louisiana
-. i. ;-p,)i '''he remainder of
lorrer.t, :-. obtained from other
t ' /;' i. ',nt raet:- .
'he Commission a
hree priorities of
impaired de liver-
'-,pp ] i e:; during the
\- i ner oaf tc r .
l
US t '),T1O I S .
I/
-------
Schedule II-S
Page 2 of 7
1AL7
C 1 as_s_:_
Sales_;_or ;\.usa l_e
!,oca 1 !)i s L r i bu I ors
OLhor Pipt rial
C u s L i;. <.' c ^
Total Salet.
I1) i
78
-------
Schedule II-S
Page 3 of 7
3. Gas used for industrial purposes including
gas sold by United to its city gate and pipeline
customers for resale to industrial end users and
also including gas used to generate electricity
which in turn is applied to industrial users.
Curtailment of service would be implemented in reverse
order of the priorities, i.e., all service in Priority 3
would be curtailed before Priority 2 deliveries were reduced
and the same procedure applied as between Priority 2 and
Priority 1. Curtailment within each priority class would be
pro-rata based upon the percentage reduction in sales needed
to equate supply with system demand for gas.
On October 26, 1970, United requested a declaratory
order from the Commission finding that Uniied's priority of
service plan "was consistent and in keeping" with the Gener-
al Terms and Conditions of United's FPC Cas Tariff. Mainline
industrial and pipeline customers filed objections to
United's request. The Commission assigned Docket No. RP71-
29 to the matter and ordered hearings to start December 21,
1970.
United placed its curtailment plan in effect on Novem-
ber 1, 1970 and by an interim settlement with the customers,
approved by the Commission, the plan remained in effect
through March 1971. A similar plan was made effective from
April"1, 1971 thiough October 31, 1971 for curtailments to
meet United's summer needs particularly for injections of
gas for underground storage. Hearings in Docket No. RP71-29
were recessed on December 22, 1970 to allow consideration of
the interim : et t lernent , started again in spring 1971 and
were «'onclud'-d July 2'', 1971.
On Octobei S, 1971, the Commission issued Opinion No.
606 approving United's curtailment plan as amended by United
in Docket Mo, RP71-170, rejecting two amendments by United
but accepting others, Unit .>>. filed revisions to its tariff
in compliance with tho Cr>i,im , -, s i o n' <--. Jk-cision on October IS,
1971 .
)u r i ;HJ the coujsc of t :'c hearings in Docket Ncs , RP71-
'.9 and RP/1-120, inainline i idu'_-tr i ,il customers protested the
Ccr.miiss ion' s jurisdiction \ i >'.>iinei incons i s t >'MI L
A j th <^i '-'t iuj1 d
' f Spouse ! '1 '":) 1 i
Natural G,r^ \ct o!ovidr
-------
Sciio,
Page
transportation of natural gus in interstate commerce and
"there lies our power and duty to act at this tine of cur-
tailments" --transportation and sales cf gas to direct
industrial users is included. As foi the consistency with
existing contracts pipelines and others "can not by contract
avoid their public interest obligation;; once our jurisdic-
tion attaches."
The customers won a favorable decision in the Fifth
Circuit Court of Appeals but ,upon appeal by the Commission, the
U.S. Supreme Court reversed!/ the Fifth Circuit ruled and
interpreted Section l(b) of the Act as giving the Commission
complete jurisdiction over the interstate transportation of
natural gas whether a particular sale is at retail or whole-
sale.
Opinion No. 647
On October 5, 1972, the Commission's Staff moved to
reopen the record in Docket No. RP71-120, citing primarily a
severe increase in United1s gas shortage during 1972. The
Staff noted that hearings in the Docket and in Docket No.
RP71-29 were concluded in July 1971, and derpite the drastic
changes that have occurred in the basic facts, no supplementary
evidence had been taken. The Commission ordered the proceedings
to be reopened.
From November 1, 1971 to January 12, 1973 United
operated under the four-level priority of service plan
ordered by the Commission in Opinion Nos. 606 and 606A:
Category I. Domestic consumers of natural gas
served directly or indirectly by Seller.
Category II. Industrial users of natural gas
served directly by Seller, to the extent they use
gas as a raw material in creating an end product
rather than as (a) an agent for heating, cooling,
dehydrating or otherwise affecting industrial process
materials, or fb; for ether indusl "i ,il purposes.
Categoiy III. Electric
served directly or i . i a *
such stations
Category
operating stations, whether
tly by rv ller, to the extent
scr v e d o., i e s r i c c o n ;: u; i e r s of c " o 7 I r i c i t v
>rs of Sellers' naiuiaJ gas, whether
;r indirectly by '"oiler, to the
extent, not supplied under Categories I, II, and III.
served directly
1 / ZZ£_Y _ J±2Ji?- s i an a
JunFTTTir
° 6 u s
80
-------
Schedule II-5
Page 5 of 7
On January 12, 1973, (Opinion No. 647) the Commission
combined Categories III and IV but made no other changes
and ordered United to curtail under the following three
priority of service steps pending establishment of a
permanent curtailment plani/ in accordance with end-use
priorities prescribed in Order No. 467.
Category I. Domestic consumers of natural gas
served directly or indirectly by Seller.
Category II. Industrial users of natural gas
served directly by Seller, to the extent they use
gas as a raw material in creating an end product
rather than as (a) an agent for heating, cooling,
dehydrating or otherwise affecting industrial process
materials, or (b) for other industrial purposes.
Category III. Users of Seller's natural gas, whether
served directly or indirectly by Seller, to the extent
not supplied under Categories I and II.
The Commission was concerned about the impact of the
change in priorities that it was prescribing for United
in the interim plan whether the change may affect the
integrity of electric service in parts of United' s service
area. The plan eliminated the priority in the four priority
plan given to boiler fuel gas used to generate electricity
which is consumed by domestic customers.
The Commission did not disturb United1 s exemption from
curtailment of an industrial customer below 3,000 Mcf per day
until all customers in the industrial category are curtailed
d )wn to the 3,000 Mcf level. In practical effect this pro-
vision would exempt all customers from being curtailed to
Less than 3,000 Mcf per day..2/
To avoid any adverse effects on the electric service,
the Commission required United to provide for an emergency
exemption from curtailment for power plants when the electric
1 / Since united made no i nt er rupt Lble sales, the Commission
used tiie first S priority steps of Order No. 467 as its
perm,-) n> . t curtailment plnn, applicable to firm sales,
The COL t..i ss ion btayed the filing of the permanent plan
p<, .id ing :'videri
-------
Sclieckie TI-S
Page ' of 7
utility is in an emergency situation requiring load shedding
of firm load, has no alternate fuel capability or purchased
power opportunities, and has used al"* alternative sources
of power. In addition, the Mectric utility will accept
reduced deliveries of gas as soon as possible to offset
volumes taken during the emergency exemption period.
The reopened proceedings in Docket RP71-120 provided
for evidence on the following:
1. Particular adverse environmental impact shown
to result from the Commission proposed imposition
of curtailment.
2. Data requirements related to all priority
categories in the Commission's plan.
3. A plan for husbanding United1s remaining gas
reserves to pro "ect residential and small
commercial service by reducing summer sales
for large boiler fuel purposes.
United made the necessary filings with the Commission
to establish the modified three-priority cmlailment plans.
This plan is still in effect on April 1, 1975 pending
further instructions from the Fifth Circuit Court of Appeals.
On November 8, 1974, the Fifth Circuit Court of Appealsi/
vacated the curtailment plans present and proposed and
remanded the Commission's Opinions and orders in United's
curtailment proceedings, Dockets Nos. RP71-29 and RP71-120,
for further findings. The Court found that the Commission
had not met the requirements of the Natural Gas Act, Sections
4(b) and 5(a) so as to find that United's four-priority
curtailment plan (quoted above) was unjust, unreasonable,
unduly discriminatory or preferential, before instituting
the three-priority plan. Similar findings and substantial
additional evidence are needed, the Court found, before
prescribing the Commission's new five-priority plan based
upon Order No, 467. The Court recommenced that the
findings be adequately supported in the remanded hearings,
The Fifth Circuit Court .>rdered Mmt the four priority
plan be re-instituted and re id in in -or:e during the remand.
Other matters considered and gererrlly recommended in
the Court's decision for further action oy the Commission
are: (1) need for the Commission to file an enviionmental
!_/ State of Louisiana, Louisiana Municipal Association
and Parish of Cameron, et al., v. Federal Power
Commission No. 73-3478.
82
-------
Schedule II-5
Page 7 of 7
impact statement with any permanent curtailment plan, (2)
firm service vs . interruptible service priority where the
end-use of gas is the same, (3) new customers' priorities
VS_L long time customers' priorities and (4) United's
cfcmtract liability to pay the extra cost of alternate fuels
to main line industrial customers when gas is curtailed.
On November 13, 1974 the Commission ordered its Solicitor
(1) to seek immediate remand of the record from the Court
so as to bring the matter back under Commission jurisdiction
and (2) to petition the Court to modify its decision by
allowing the present three-priority plan to remain in effect
pending an "expeditious decision" by the Commission on the
remand.
In its order, the Commission stated that the result of
reinstating the four priority plan could be catastrophic.
Natural gas service to approximately 400 industrial customers
would be completely cut off "on an average day in November
as well as the foreseeable winter." Under the three-priority
plan some of the 400 ,vould be substantially curtailed but
none would be cut off completely.
The Court granted the Commission's petitions and hearings
in the reopened proceeding are in progress.
-------
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o
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Schedule III-l
Sheet 2 of 2
STATE GAS CURTAILMENT PLANS L974-1975 BY STATES
FOOTNOTES AND SOURCE
a./ Curtailment plan of Cheaspeake Utilities Corporation.
W Curtailment plan of Delmarva Power and Light Company.
c/ Curtailment 2 applies to customers attached after October 2,6, 1971.
Curtailment 3 applies to other customers with alternate fuel capability.
d_/ Curtailment 2 applies when curtailment would not cause layoff of
personnel. Curtailment 3 applies when layoff would be a minimum.
Curtailment 4 applies when curtailment is required regardless of
layoff of personnel.
_£/ After all industrial service is curtailed no distinction is made
in curtailment of other services.
_f/ Curtailment applicable where alternate fuels could meet requirements
although facilities and supplies may not be available. Curtailment
2 applies to requirements 3000-10,000 Mcf/d; Curtailment 3 to require-
ments 1500- 3000 Mcf/d. Curtailment 4 to more than 300 Mcf/d but less
than 1500 Mcf/d.
_£_/ Curtailment 7 applies to all interruptible requirements up to 300
Mcf/d. Curtailment 8 applies to all interruptible requirements where
propane is the only alternate fuel and is necessary for that portion
used for processing.
h/ Curtailment 13 for feedstock and processing needs. Curtailment 14 for
plant protectior, i.e., pilot light; minimum heat, etc.
i/ Sales for resole u> wholesale customers for commercial, industrial
and residential cor,sumption.
j_/ Customers that have alternate fuel facilities and supplies.
I/)
I/) Curtailment plans ot Cincinnati Gas and Electric Co., Columbia Gas
m/) of Ohio and Fast Ohio Gas Co. respectively.
o/ Curtailment plan oi Oklahoma Natural Gas Co.
Source: Novci.'.ber 15, IV'74 Smvey R. port of National Association of
Tory UtilLt-/ Commissioners
-------
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Schedule IV-1
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Schedule IV-1
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Schedule IV-1
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Schedule V - 1
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Schedule V - 1
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Schedule V-2
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Schedule V-2
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Schedule V-3
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Louisiana 387.
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Montana 1.
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Arizona 49.
California 468.
Nevada 41.
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n/ Negligible.
TA-18974
138
-------
1973 DISTRIBUTION OF FUEL CONSUMPTION BY ELECTRIC UTILITIES
(Percent)
Schedule V-4
Natural Fuel
New England
Connecticut
Maine
Massachusetts
New Hampshire
Rhode Island
Vermont
Appalachian
Delaware
District of Columbl
Kentucky
Maryland
New Jersey
New York
Ohio
Pennsylvania
Virginia
West Virginia
Southeast
Alabama
Florida
Georgia
North Carolina
South Carolina
Tennessee
Great Lakes
Illinois
Indiana
Michigan
Wisconsin
Northern Plains
Iowa
Minnesota
Nebraska
North Dakota
South Dakota
Mid Continent
Kansas
Missouri
Oklahoma
Gulf Coast
Arkansas
Louisiana
Mississippi
Texas
Rocky Mountain
Colorado
Montana
Utah
Wyoming
Pacific Southwest
Arizona
California
Nevada
New Mexico
Pacific Northwest
Idaho
Oregon
Washington
Total 48 States
n/ Negligible
lias uj.&i.xj.j.cii.c
0.8% 1.9%
1.6
2n
. U
2.4
1.7
.a
1.4
3.1
6.2
6.7
0.7
0.3
1. 0
a/
7.6
0.4
20.4
9. 6
0.7
8.2
2. 0
3.5
3.5
1.5
2.7
8.5
22.8
31.3
0 } 1
t.1. . 1
48.0
0.2
6.1
52.1
83.0
12.8
86.9
81.6
52.3
90.3
43.5
86.0
13.6
31.6
2 . 2
10.1
0.6
30.6
30.4
32.4
27.9
20.7
0.2
0.9
n/
18.3
Sources: Gas: Future Requirements
Voi. 5,
September 1974.
£ . J
Ifl
. u
1.7
IT
. J
1.8
4. 6
3.0
2.8
3.2
/
n/
3.1
12.6
4.8
1.2
2.2
1Q
. o
H/
1.7
OQ
. 0
2.4
4Q
. y
1.0
2.4
09
> i
2f)
. £.
3.0
0.5
2.7
1. 6
2.1
1.8
~\ f.
J . O
2.4
0.1
0.4
0.8
1. 7
0.7
0.3
3.8
1.0
5.0
21.1
2.3
0.5
0.6
OQ
. y
0.2
0.1
2.0
15.8
0.4
0.6
1.4
0.4
n/
0.6
0. 3
2.3
Committee,
Coal: Federal Power Commission News
Nuclear
Industry
Fuel Oil
and Hydro: Edison Electric
for 1973, November 1974.
: U.S. Bureau of
Oil
Residual
67.2%
7fi ^
/ O . J
35.5
79.4
24.0
97 .9
0.1
23.2
60.2
82.1
0. 1
54.7
59.8
44.3
0.9
10.4
43.7
0.7
15.8
52.3
5.9
6.0
8.9
4. 1
3.8
0.6
9.9
I 7
1.2
0.8
2.2
0.7
n/
1.6
1.2
31
, 4
0.7
0.4
5.6
25.0
4.7
11.2
2.5
1.5
2.3
0.4
5.1
0.3
27.8
12.2
37.1
2.0
1.1
a/
n/
n/
15.8
Coal
3.3%
0.3
0.1
46.1
2.7
60.9
35.3
14.7
91.4
31.3
13.1
11.5
97.2
85.3
30.7
98.3
58.8
76.5
18.6
67.8
79.5
44.0
78.4
77.3
69.9
96,6
77.6
64.6
55.1
61.4
56.7
29.4
81.5
13.1
39.6
11. 9
81.1
- /
n/
6.2
24.2
7.9
59.2
57.7
20.1
28.3
90.4
13.7
5.4
58.1
76.5
5.9
8.6
45.0
Future Gas Consumption
Release Number
20333,
Institute, Statistical
Mines, Sales of fuel oil
Nuclear
19.6%
19.0
41.1
15.4
56.2
3.4
9.1
6.6
0.4
19.3
3.6
0.5
6.0
22.6
11.4
19.7
5.1
17.5
5.2
12.2
6.0
1.4
2.0
3.9
5.6
4.4
in the United
dated May 24,
Hydro
7.2%
1.9
22.4
1.8
28.6
0.3
34.4
7.1
n/
7.1
7.8
(0.8)
26.1
n/
1.4
3.5
1.0
12.5
21.8
0.3
11.8
12.8
13.9
19.4
1.5
0.1
0.8
2.0
6.1
13.6
4.7
3.2
13.5
18.2
78.8
6.3
n/
4.7
12.4
2.8
21.7
1.3
25.2
7.8
76.4
56.3
8.6
24.5
36.2
28.1
11.4
0.3
89.6
100.0
98.5
85.4
14.2
States,
1974.
Total
100.0%
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Supplement to
Yearbook of the Electric Utility
nd kerosine in i.y/3.
139
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TECHNICAL REPORT DATA
(Please read Instructions on the reverse before completing)
1. REPORT NO.
EPA-450/3-76-030b
2.
3. RECIPIENT'S ACCESSION NO.
4. TITLE AND SUBTITLE
Impact of Natural Gas Curtailments on Electric
Utility PI ants--Two Volume Report: Volume I, Text,
Volume II. Schedules (Data and Summary Tables)
5. REPORT DATE
August 1975
and
6. PERFORMING ORGANIZATION CODE
7. AUTHOR(S)
Brickhill, J.A.
8. PERFORMING ORGANIZATION REPORT NO.
9. PERFORMING ORG \NIZATION NAME AND ADDRESS
Energy Division
Foster Associates, Inc.
1101 Seventeenth Street, N.W.
Washington, D.C. 20036
10. PROGRAM ELEMENT NO.
11. CONTRACT/GRANT NO.
68-02-1452, Task 1
12. SPONSORING AGENCY NAME AND ADDRESS
U.S. Environmental Protection Agency
Office of Air Quality Planning and Standards
Strategies and Air Standards Division
Research Triangle Park, North Carolina 27711
13. TYPE OF REPORT AND PERIOD COVERED
Contract Report
14. SPONSORING AGENCY CODE
15. SUPPLEMENTARY NOTES
EPA Project Officer: Rayburn Morrison
16. ABSTRACT
This study was conducted to analyze the impact of natural gas curtailments
on electric utility plants through the review of the curtailment plans of inter-
state pipeline, intrastate pipeline and gas distributors. This analysis determined
the availability of natural gas through 1980 to 415 electric utility power plants,
the alternate fuel burning capability of these plants and the impact of gas cur-
tailments on the need for alternate fuels such as fuel oil and coal. The study
results are presented in a two volume report: the first contains the narrative
with pertinent findings and conclusions; the second contains the schedules or data
summaries.
7.
KEY WORDS AND DOCUMENT ANALYSIS
DESCRIPTORS
Fuels
Natural gas curtailments
Steam plants
United States
Government
Regulations
Air pollution
b.lDENTIFIERS/OPEN ENDED TERMS
c. COS AT I Field/Group
Natural gas
Electric power
generation
Air pollution control
18. DISTRIBUTION STATEMENT
Unlimited
19. SECURITY CLASS (ThisReport)
Unclassified
21. NO. OF PAGES
148
20. SECURITY CLASS (Thispage)
Unclassified
22. PRICE
EPA Form 2220-1 (9-73)
140
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