Rochester Gas & Electric Files to Use Alternative Index for Cashouts

Rochester Gas & Electric has filed with the New York PSC to modify its tariff to allow the use of an alternative suitable index for cashouts as set forth in its Gas Transportation Operating Procedures (GTOP) Manual.

RG&E's current tariff provisions require RG&E to use an average of the Niagara index price and the Dominion Transmission Incorporated (DTI) Appalachia South Point to cash out imbalances.

RG&E uses the published Gas Daily Niagara index for the Empire side of the system which is based on reported transactions at the point of interconnection between Tennessee Gas Pipeline (TGP) and TransCanada Pipeline. Natural gas supply into the RG&E distribution system on the Empire Pipeline side of the system is sourced from Chippawa, the point of interconnection between Empire and TransCanada Pipeline, but, historically, there has not been a published index for the Chippawa point, RG&E said.

"Beginning in March, the reporting of the Niagara Index in Gas Daily became sporadic and, on certain days, there was no reported price. Given the changing operational pipeline flows, RG&E expects that the unpredictability of the Niagara Index in Gas Daily may continue," RG&E reported.

"Therefore, RG&E is proposing changes to its tariffs whereby the methodology for determining the applicable index prices for its cashout calculations will be established in the GTOP Manual."

The specific tariff changes would strike the tariff's current reference to the Niagara midpoint and the Dominion Transmission Incorporated Appalachia South Point midpoint in the cashout methodology. In their place, the tariff would refer to "midpoint index prices" as established per the procedures to be included in the GTOP.

The relevant indices and specific calculations to be established in the GTOP were not immediately available.

RG&E sought an effective date of September 1, 2012 for the tariff change.

In accordance with its tariff, RG&E is cashing out customers, on the days when there is no reported price for the Niagara Index in Gas Daily, using the prices reported for Dominion Transmission Incorporated (DTI) Appalachia South Point.