Equitable Proposes Amounts for Bypassable Gas Procurement Charge, Merchant Function Charge

Equitable Gas Company, LLC has filed at the sPennsylvania PUC the proposed level for the bypassable Gas Procurement Charge, reflecting certain supply-related procurement costs unbundled from base rates, and the bypassable Merchant Function Charge, reflecting supply-related uncollectibles unbundled from base rates.

Equitable proposes a bypassable Gas Procurement Charge of $0.015/Mcf that will be part of the Price to Compare and applicable to Rate Schedules RS, GSS, and GSL.

Regarding supply procurement costs included in the Gas Procurement Charge, Equitable said that, at this time, it is not able to remove working capital from distribution rates as a gas procurement cost. Equitable defines working capital as the pre-tax return amount of the current gas storage inventory. In Equitable's most recent base rate proceeding at Docket No. R-2008-2029325, a "black-box" settlement was reached amongst all of the parties and approved. As such, a defined pre-tax return rate was not established in the proceeding, Equitable said.

For the Merchant Function Charge, Equitable proposes a bypassable MFC equal to 1.7633% of the current Purchased Gas Cost for residential customers served under Rate Schedule RS, and 0.4499% for commercial and industrial customers served under Rate Schedules GSS and GSL.

Based on the PGCs included in a filed tariff, the MFC would equal $0.101/Mcf for residential customers served under Rate Schedule RS and $0.026/Mcf for commercial and industrial customers served under Rate Schedules GSS and GSL.

Docket R-2012-2333983