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New York Utility To Include Reconciliation Refund Of 7¢/Ccf In Default Service Rate

Numerous LDCs File For Reconciliation Refunds of 1-2¢/therm

Two Utilities To Add Reconciliation Surcharge Of About 1¢/Ccf To Default Service Rate


October 16, 2019

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Copyright 2010-19 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

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The New York natural gas utilities have filed their annual reconciliations of their default service gas supply costs for the twelve-month period ended August 31, 2019.

National Fuel Gas Distribution Corporation filed a report showing a GAC reconciliation surcharge factor of $0.0889/Mcf, or $0.00889/Ccf

National Fuel Gas Distribution Corporation reported an undercollection of $5.0M in its annual gas cost filing, which is approximately 2.1% of total gas cost. This compares to an undercollection of $2.3M last year.

National Fuel Gas Distribution Corporation said in its filing, "Under and over collections can be impacted by weather, estimates of commodity purchase volume and cost, estimates of demand recovery and the year-end LIFO storage adjustment. The undercollection was partially due to lower actual retail volumes compared to forecasted volumes. Forecasted volumes are used in the calculation of Natural Gas Supply Charge rates in the monthly GAC filing."

In its annual filing, Orange and Rockland Utilities, Inc. reported that, for the twelve-month period ended August 31, 2019, the company experienced a GSC over-collection of $9,108,833 including interest. At O&R, this results in a GSC refund rate of $0.7060 per Mcf, or $0.07060 per Ccf, to be refunded over the twelve-month period commencing January 1, 2020

In its annual filing, Consolidated Edison Company of New York, Inc. reported a calculation of a credit to firm gas sales customers of approximately $13.92 million including interest, "based on currently available data that is still undergoing review." This consists of a $12.98 million net Gas Cost Factor (GCF) over-collection for the twelve months ended August 2019; a $0.61 million credit related to an over-collection of a GCF reconciliation for the twelve months ended August 31, 2017; and an estimated interest credit of approximately $0.33 million.

ConEd reported that the unit amount for such refund is $0.015156 per therm for firm gas customers through the GCF

New York State Electric & Gas Corporation (NYSEG) filed a report showing a GSC refund rate of $0.018396 per therm for default service customers, beginning with the first billing cycle of January 1, 2020 and continuing through December 31, 2020

Rochester Gas and Electric Corporation (RG&E) filed a report showing a GSC refund rate of $0.016674 per therm for default service customers, beginning with the first billing cycle of January 2020 and continuing through December 2020

Central Hudson Gas & Electric filed a report showing a firm GSC refund rate of $0.00704 per Ccf

KeySpan NY

Gas Cost Reconciliation

In its annual filing, The Brooklyn Union Gas Company d/b/a National Grid NY (KeySpan NY) said that the Company under-collected approximately $12.18 million of gas purchase costs for the twelve months ended August 31, 2019. This under collection results from the netting of: 1) $16.90 million gas expense under recoveries; 2) $0.05 million residual under recovery of the 2017 annual reconciliation; and 3) a $4.77 million credit adjustment under the Company’s 'Lost And Unaccounted For' (LAUF) gas incentive mechanism. The LAUF adjustment results from the fact that the Company’s actual LAUF rate for the period was 2.658%, which is greater than the allowed LAUF rate of 1.654%. The company said that the LAUF target for the Gas Adjustment Clause (GAC) year ended August 31, 2019 is a blended rate of the previous LAUF target of 1.902% and the new LAUF target of 1.530% that went into effect January 1, 2019.

Accordingly, KeySpan NY will surcharge the $12.33 million, including interest, under collection to firm sales customers provided service under Service Classification (SC) 1A, 1AR, 1B, 1BI, 1BR, 1BDG, 2, 3, 4A, 4A-CNG, 4B, 7 and 21 (Firm Sales Customers).

KeySpan NY said that application of the gas cost reconciliation provisions in the Company tariff, PSC No. 12 (Leaf 79.7), would result in an annual cost of gas imbalance surcharge of $0.01205 per therm for the period January 1, 2020 through December 31, 2020.

Other KeySpan NY Reconciliations

KeySpan NY reconciled MFC expenses and recoveries for the twelve months ended August 31, 2019 related to: 1) Gas Procurement and Commodity Related Sales Promotion Expenses; 2) Commodity Related Credit and Collection Expenses (“Credit and Collection Expenses”); 3) Uncollectible Expenses Associated with Gas Costs; 4) Return Requirement on Gas Purchase Related Working Capital; and 5) Return Requirement on Gas in Storage (“Storage Return”).

KeySpan NY over-collected a de minimis amount of MFC expenses from firm, TC and IT sales customers. Because the amount was de minimis, the rate for the over collection to firm sales customers is a $0.00000 per therm annual MFC imbalance surcharge, as set forth on the Statement of Gas and Pipeline Costs and Adjustments (GAC Statement), for the period from January 1, 2020 through December 31, 2020. The Company will recover the under collection from TC and IT customers through a $0.00027 per therm annual MFC imbalance surcharge, which will be included in the rates set forth on the Statement of Temperature Controlled Sales Service Rates and the Statement of Standard Offer Price for the period from January 1, 2020 through December 31, 2020.

KeySpan NY under-collected Storage Return from firm transportation customers provided service under SC 17 (Firm Transportation Customers). This under collection will be recovered from Firm Transportation Customers through a $0.00012 per therm annual Storage Return surcharge, which includes interest and will be set forth on the Statement of Transportation Adjustment Charges (TAC Statement) for the period from January 1, 2020 through December 31, 2020.

KeySpan NY under collected Credit and Collection Expenses from sellers and direct customers provided service under SC 19 that participate in the Company’s purchase of receivables program. This under collection will be surcharged to the sellers and direct customers through a $0.00042 per therm Credit and Collection Expenses annual imbalance surcharge, which includes interest and will be set forth on the Statement of Seller Charges and Adjustments (Seller Statement) for the period from January 1, 2020 through December 31, 2020.

KeySpan Long Island

Gas Cost Reconciliation

Concerning gas costs, KeySpan Gas East Corporation d/b/a National Grid (KeySpan Long Island) over-collected approximately $1.56 million for the twelve months ended August 31, 2019. This over collection results from the netting of: 1) $2.27 million gas expense under recovery; 2) the $0.106 million residual under-recovery of the 2017 annual reconciliation; and 3) a $3.94 million credit adjustment under the Company’s Lost And Unaccounted For (LAUF) gas incentive mechanism. The LAUF adjustment results from the fact that the actual LAUF rate for the period totaled 2.367%, which is greater than the allowed LAUF rate of 1.156%. The LAUF target for the Gas Adjustment Clause (GAC) year ended August 31, 2019 is a blended rate of the previous LAUF target of 1.284% and the new LAUF target of 1.092% that went into effect January 1, 2019.

Accordingly, KeySpan Long Island will credit the $1.56 million over collection, plus interest, to firm sales customers provided service under Service Classification (SC) 1, 2, 3, 9, 15, 16, and 17 (Firm Sales Customers) through a $0.00201 per therm annual cost of gas imbalance credit, which includes interest and is set forth on the Statement of Gas and Pipeline Costs and Adjustments (GAC Statement) for the period from January 1, 2020 through December 31, 2020.

KeySpan Long Island's SPA, which is calculated as the difference between the LAUF upper dead-band limit of 1.963% and the LAUF target of 1.156%, is a charge of $2.62 million. Accordingly, the Company will surcharge Firm Sales Customers and firm transportation customers provided under SC 1, 2, 3, 9, 15, 16 and 17 a $0.00261 per therm charge, which includes interest and will be set forth on the GAC Statement for the period January 1, 2020 through December 31, 2020.

KeySpan Long Island

Other Reconciliations

KeySpan Long Island reconciled MFC expenses and recoveries for the twelve months ended August 31, 2019 related to: 1) Gas Procurement and Commodity Related Sales Promotion Expenses; 2) Commodity Related Credit and Collection Expenses (Credit and Collection Expenses); and 3) Return Requirement on Gas in Storage (Storage Return).

KeySpan Long Island under-collected MFC expenses from firm, TC, and IT sales customers. The Company will surcharge this under collection from firm sales customers through a $0.00006 per therm annual MFC imbalance surcharge, which includes interest and is set forth on the GAC Statement for the period from January 1, 2020 through December 31, 2020. The Company will surcharge the under-collection from TC and IT customers through a $0.00006 per therm annual MFC imbalance surcharge, which will be included in the rates set forth on the Statement of Rates and Charges for Temperature Controlled Service and the Statement of Rates and Charges for Interruptible Service for the period from January 1, 2020 through December 31, 2020.

KeySpan Long Island under-collected Storage Return related to transportation service from firm transportation customers provided service under SC 5 (Firm Transportation Customers). This under collection will be surcharged to Firm Transportation Customers through a $0.00001 per therm annual Storage Return surcharge, which includes interest and will be set forth on the Statement of Transportation Adjustment Charges (TAC Statement) for the period from January 1, 2020 through December 31, 2020.

KeySpan Long Island under-collected Credit and Collection Expenses related to transportation service from sellers and direct customers provided service under SC 8 that participate in the Company’s purchase of receivables program. This under collection will be recovered from sellers and direct customers through a $0.00026 per therm Credit and Collection Expenses annual imbalance surcharge that includes interest and will be set forth on the Statement of Seller Charges and Adjustments (Seller Statement) for the period from January 1, 2020 through December 31, 2020.

KeySpan Long Island will credit approximately $0.585 million of pipeline refunds, marketer penalty credits, and Brooklyn Navy Yard credits received as of August 31, 2019 to Firm Transportation Customers. An Annual Transportation Adjustment Charge Imbalance Refund of $0.0024 per therm that includes interest will be set forth on the TAC Statement for the period from January 1, 2020 through December 31, 2020.

Niagara Mohawk

Gas Cost Reconciliation

For gas costs, Niagara Mohawk (National Grid) over-collected approximately $19.9 million for the twelve months ended August 31, 2019. This over-collection results from the netting of: 1) $15.7 million of GAC revenue exceeding gas expenses; 2) a $180K residual under-recovery from the prior reconciliation; and 3) a $4.3 million credit under the Company’s lost and unaccounted for (LAUF) gas incentive mechanism.

Accordingly, NiMo will credit the $20.3 million over-collection ($19.9 million plus interest) to firm sales customers provided service under Service Classification (“SC”) 1, 2, 3, 12, and 13 (Firm Sale Customers) through a $0.03426 per therm unit refund set forth on the Monthly Cost of Gas (MCG) Statement for the period from January 1, 2020 through December 31, 2020.

NiMo's SPA, which is calculated as the difference between the LAUF upper dead-band limit of 2.516% and the LAUF target of 1.516%, is a charge of $3,059,843. Accordingly, the Company will surcharge Firm Sales Customers and firm transportation customers provided under SC 1, 2, 3, 5, 7, 8, 12 and 13, $0.002814 per therm, which also includes a prior period SPA balance of $0.086 million and interest as set forth on the SPA Statement for the period January 1, 2020 through December 31, 2020.

Niagara Mohawk

Other Reconciliations

Niagara Mohawk has a net under-collection of $143,115 that will be surcharged to firm transportation customers provided monthly balancing service under SC 1MB, 2MB, 5MB, 7MB, 12MB, and 13MB. Accordingly, the Company will implement a $0.00054 per therm Annual Transportation Imbalance Surcharge, including interest, which will be set forth on the Gas Transportation Rate (TRA) Statement for the period from January 1, 2020 through December 31, 2020.

Niagara Mohawk reconciled MFC expenses and recoveries for the twelve months ended August 31, 2019 related to: 1) Commodity Related Credit and Collection Expense; 2) Gas Supply Procurement Expenses; and 3) Return Requirement on Gas Storage Inventory.

For the credit and collection expenses, Niagara Mohawk over-collected from residential customers. The Company will credit the over-collection to residential customers with a ($0.00006) per therm annual MFC imbalance surcharge that includes interest and will be included on the MFC statement for the period from January 1, 2020 through December 31, 2020. The Company under collected from non-residential customers and will surcharge non-residential customers with a $0.00004 per therm annual MFC imbalance surcharge that includes interest and will be included on the MFC statement for the period from January 1, 2020 through December 31, 2020.

For the gas supply procurement expenses, Niagara Mohawk over-collected from firm sales customers. The over-collection will be credited to firm sales customers with a ($0.00014) per therm annual MFC imbalance that includes interest and will be included on the MFC statement for the period from January 1, 2020 through December 31, 2020.

For the Return Requirement on Gas Storage Inventory Charge, Niagara Mohawk over-collected from firm sales customers. The over collection will be credited to firm sales customers with a ($0.00017) per therm annual MFC imbalance that includes interest and will be included on the MFC statement for the period from January 1, 2020 through December 31, 2020.

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