fw : southern trails article on western leg - - - - - original message - - - - -
from : brennan , lorna
sent : wednesday , august 08 , 2001 10 : 11 am
to : mcgowan , mike w .
cc : ratner , michael
subject : southern trails article on western leg
questar can ' t sell from proposed pipeline under new ca rate
although not giving up its search for customers in california , salt lake city - based questar corp . ' s oil - to - natural - gas converted pipeline from the four corners of new mexico remains stymied in operating its portion within california under a newly revised " peaking tariff " for southern california gas co . , according to questar officials who have been analyzing the new rate established aug . 2 by state regulators . questar is looking at alternative uses for the california portion of the approved interstate pipeline .
" we can ' t work with ( the rate ) as it is , " said chad jones , a questar spokesperson . " it definitely doesn ' t go far enough to remove the obstacles in the way of developing new pipelines in southern california . it still doesn ' t level the playing field . although it is better than the current rls ( residual load service ) tariff ; it still punishes customers who want to take partial service from a socalgas competitor .
" customers still have to pay higher interruptible penalties than in other parts of the state , and higher rates for balancing services . we ' re at the point where we ' re not going to stop trying to market capacity on southern trails , but we ' re definitely at the point where we have to consider some alternative uses for the california portion ( of the 700 - miles , 16 - inch - diameter pipeline ) . "
one of the alternatives would be to operate the california part of the line as a petroleum or liquids line carrying product from the long beach harbor area to existing petroleum or liquid products pipelines in and around the california - arizona border . that ' s the alternative , however , jones said , but finding a customer for a major portion of the converted pipeline ' s 120 mmcf / d capacity is still questar ' s preference .
after months of reviewing the issue and weighing alternatives , the california public utilities commission last week established a new " peaking " or standby charge for customers taking partial service from a socalgas competitor , allowing those customers to pay only for the amounts of gas they use at any given time from the local gas transmission and distribution utility , socalgas .
the cpuc tried to balance the need for the local gas utility to be made whole so added fixed costs did not have to be shifted to other customers , while trying to " encourage and promote additional natural gas resources without encouraging cherry - picking or overbuilding , " according to cpuc president loretta lynch .
questar officials said tuesday they have pretty much exhausted their appeal resources , and they are " not about to go head - to - head with the established big boys " in lobbying california ' s governor or state legislature , jones said . " thus , we ' re still looking for a large customer who would be willing to break the gridlock in southern california in the name of promoting competition . "
the east - of - california portion of the southern trails pipeline is already fully subscribed and will start operations mid - year next year , jones said .
fw : southern trails article on western leg
- - - - - original message - - - - -
from : brennan , lorna
sent : wednesday , august 08 , 2001 10 : 11 am
to : mcgowan , mike w .
cc : ratner , michael
subject : southern trails article on western leg
questar can ' t sell from proposed pipeline under new ca rate
although not giving up its search for customers in california , salt lake city - based questar corp . ' s oil - to - natural - gas converted pipeline from the four corners of new mexico remains stymied in operating its portion within california under a newly revised " peaking tariff " for southern california gas co . , according to questar officials who have been analyzing the new rate established aug . 2 by state regulators . questar is looking at alternative uses for the california portion of the approved interstate pipeline .
" we can ' t work with ( the rate ) as it is , " said chad jones , a questar spokesperson . " it definitely doesn ' t go far enough to remove the obstacles in the way of developing new pipelines in southern california . it still doesn ' t level the playing field . although it is better than the current rls ( residual load service ) tariff ; it still punishes customers who want to take partial service from a socalgas competitor .
" customers still have to pay higher interruptible penalties than in other parts of the state , and higher rates for balancing services . we ' re at the point where we ' re not going to stop trying to market capacity on southern trails , but we ' re definitely at the point where we have to consider some alternative uses for the california portion ( of the 700 - miles , 16 - inch - diameter pipeline ) . "
one of the alternatives would be to operate the california part of the line as a petroleum or liquids line carrying product from the long beach harbor area to existing petroleum or liquid products pipelines in and around the california - arizona border . that ' s the alternative , however , jones said , but finding a customer for a major portion of the converted pipeline ' s 120 mmcf / d capacity is still questar ' s preference .
after months of reviewing the issue and weighing alternatives , the california public utilities commission last week established a new " peaking " or standby charge for customers taking partial service from a socalgas competitor , allowing those customers to pay only for the amounts of gas they use at any given time from the local gas transmission and distribution utility , socalgas .
the cpuc tried to balance the need for the local gas utility to be made whole so added fixed costs did not have to be shifted to other customers , while trying to " encourage and promote additional natural gas resources without encouraging cherry - picking or overbuilding , " according to cpuc president loretta lynch .
questar officials said tuesday they have pretty much exhausted their appeal resources , and they are " not about to go head - to - head with the established big boys " in lobbying california ' s governor or state legislature , jones said . " thus , we ' re still looking for a large customer who would be willing to break the gridlock in southern california in the name of promoting competition . "
the east - of - california portion of the southern trails pipeline is already fully subscribed and will start operations mid - year next year , jones said .