nui corp thanks for the reply on the other memo . i thought you might want to see this information as well - - it ' s regarding the likelihood of under - collection on the part of nui . if you have any questions , please ask .
ed
- - - - - - - - - - - - - - - - - - - - - - forwarded by ed mcmichael / hou / ect on 03 / 30 / 2001 01 : 01 pm - - - - - - - - - - - - - - - - - - - - - - - - - - -
ed mcmichael
03 / 30 / 2001 10 : 30 am
to : tanya rohauer / enron @ enronxgate , rudwell johnson / enron @ enronxgate , bradford larson / enron @ enronxgate , david gorte / enron @ enronxgate , william s bradford / enron @ enronxgate
cc : mark breese / hou / ect @ ect , steve montovano / na / enron @ enron , frank w vickers / na / enron @ enron , john craig taylor / hou / ect @ ect
subject : nui corp
the attached information is from steve montovano , enron corp . vp governmental . / regulatory affairs . this information applies to all gas utilities in new jersey , including elizabethtown gas company , the largest gas utility in the nui corp . group of companies . i hope this information will help expedite your evaluation process . thanks for your help with this deal . if you have any questions , please ask .
regards ,
ed
- - - - - - - - - - - - - - - - - - - - - - forwarded by ed mcmichael / hou / ect on 03 / 30 / 2001 10 : 18 am - - - - - - - - - - - - - - - - - - - - - - - - - - -
steve montovano @ enron
03 / 30 / 2001 09 : 47 am
to : ed mcmichael / hou / ect @ ect , mark breese / hou / ect @ ect
cc : frank w vickers / na / enron @ enron , richard shapiro / na / enron @ enron
subject : nui corp
confidential information
ed / mark - in follow - up to our telephone conversation this am regarding nui ' s ability to pay for gas purchases that they will make this summer and pay for next winter i offer you the following information regarding nui ' s most recent levelized gas cost adjustment ( lgac ) proceeding just concluded at the board of public utilities ( bpu ) :
the nj bpu ordered on march 15 , 2001 the following :
the lgac is nui ' s regulatory mechanism in which they recover all of their natural gas costs ;
nui will increase its current gas costs from roughly $ 6 . 70 dth to $ 7 . 20 between april 01 and july 01 ;
they will be allowed to continue to defer any underrecovered gas costs until 10 / 31 / 01 , at which time they will file a " compliance " filing with the bpu no later than 11 / 15 / 01 ;
the compliance filing will set out a three year amortization schedule to recover the underrecovered gas cost balance as of 10 / 31 / 01 and will include interest at 5 . 5 % ;
nui will also at that time ( 11 / 01 ) file a new new levelized gas cost adjustment ( lgac ) , if the $ 7 . 20 is not sufficient to avoid future gas cost underrecoveries ;
although that additional increase , if needed , is not officially granted at this time it does not concern your deal because your deal is inside the test period which was approved . secondly , the precedence has been set for recovery with interest , with this current order ;
the 1999 nj deregulation act helped nui get the carrying costs on the underrecovered balance in that it called for " full and timely " recovery of gas costs for all nj ldc ' s ;
unfortunately , the bpu has not yet issued the order , so i cannot send it to you , however that is typical of this board and may not be issued for some time , at which point i will forward it to you ;
it is important to note for precedence arguments that this order is a bpu order of a contested case , not a settlement and applies to all nj ldc ' s ;
should you wish to discuss this matter further please call me . note that i will be out of the office for two weeks beginning monday and can reached through chauncey .
steve