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Retail Suppliers Detail "Difficulties" in Maine Market Since Unitil Acquisition of Northern Utilities

June 9, 2015

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Copyright 2010-15 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

In testimony concerning Northern Utilities' proposal to provide capacity planning for 100% of its load with the exception of dual fuel customers (eliminating the capacity exempt status for other transportation customers), Global Montello Group Corp. and Sprague Operating Resources, LLC expressed that they are, "very concerned with the implementation of Northern's retail access program under Unitil's management."

Unitil announced in December 2008 that it completed the purchase of Northern Utilities, Inc.

In their testimony, aside from the concerns with the proposed capacity planning changes, the retail suppliers said that, "since 2009, there have been persistent and increasing difficulties cooperating with Northern in marketing natural gas at the retail level in Northern's Maine Division service territory."

The suppliers alleged the following challenges:

• Increase in peaking commodity rates, example 2011 $9.50, 2015 $31.90

• Increase in price of storage gas; example 2011 $4.45, 2015 $6.05

• Implementing sudden mid-winter monthly or daily tiers to accessing the 100-day Washington 10 storage commodity, but for marketers only – not firm sales service – and critically harming delivery service customers in early 2014;

• Providing the most favorable resources to its asset managers with the most flexible terms;

• Not providing all marketers an equal opportunity to bid for Northern's or Unitil's asset management work;

• Complete elimination of intraday nominations for any of the company-managed assets;

• Restrictions on nominating company-managed resources to 8:15 a.m. Eastern Time on the previous Gas Day, moved back from 10 a.m. the day of Gas flow;

• Inability to use internal billing systems to control distribution of interstate pipeline refunds only to customers or stakeholders who paid them;

• Not ensuring the necessary separation from Granite to protect ratepayers and marketers from affiliate abuse;

• Taking benefits - such as the ability to deliver for Maine from Pleasant Street - for itself, but not permitting marketers the same rights and privileges;

• Ignoring the tariff provision that provides Pleasant Street as a receipt meter option for marketers "for the purposes of administering capacity assignments, nomination, balancing, imbalance trading and aggregation pools;"

• Requiring marketers (only) to deliver for Maine at Westbrook from Granite, via PNGTS or Maritimes, which increases costs for marketers and customers by increasing capacity costs and limiting access to liquid supply points, without any tariff authority to do so;

• Calling OFOs on Northern's distribution system in Maine every time Tennessee Gas Pipeline calls an OFO, subjecting marketers and customers to imbalance penalties, even though Northern prohibits deliveries to Maine off of Tennessee; marketers are potentially at risk of 5 times the Gas Daily Average (“GDA”) even if no upstream delivery pipelines call an OFO.

• Restricting marketers from using managed supplies for meeting weekend swing requirements, forcing citygate purchases for varying weather or production level swings.

• Cashing out marketer over-deliveries that are now required to be made at Westbrook (which marketers now do on peak days to avoid penalties, inuring to the benefit of sales customers) at the much lower Tennessee Zone 6 price

Docket No. 2014-00132

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