29102 Federal Register / Vol. 66, No. 103 / Tuesday, May 29, 2001 / Notices

1Section 284.8(i) of the Commission’s

regulations, as implemented by Order No. 637,

states that, ‘‘[u]ntil September 30, 2002, the

maximum rate ceiling does not apply to capacity

release transactions of less than one year. With

respect to releases of 31 days or less under

paragraph (h), the requirements of paragraph (h)(2)

will apply to all such releases regardless of the rate

charged.’’

2On May 18, 2001, in Docket No. RM01–9–000,

the Commission issued an order proposing to

impose certain reporting requirements on natural

gas sellers and transporters serving the California

market. The proposed reporting requirements are

intended to provide the Commission with the

necessary information to determine what action, if

any, it should take within its jurisdiction. Our order

today coupled with our May 18 order continues to

focus on issues related to natural gas prices in

California and actions we may take to address

capacity release transactions and bundled sales (i.e.,

the ‘‘gray market’’).

3Energy Information Administration 1999 Report

on California Interstate Natural Gas Pipeline

Capacity Levels. The Commission has also recently

approved an additional 485,000 Mcf/day of capacity

into California. See, Questar Southern Trails

Pipeline Company, Docket No. CP99–163–001, et

al., 92 FERC ¶ 61,110 (2000); Kern River Gas

Transmission Company, Docket No. CP01–106–000,

95 FERC ¶ 61,022 (2001); and E1 Paso Natural Gas

Company, Docket No. CP00–422–000, et al., 95

FERC ¶ 61, 176 (2001). 4See, www.cpuc.ca.gov/static/industry/gas/

gas+workshop.htm. April 17, 2001 presentation of

the California Energy Commission at CPUC Natural

Gas Infrastructure Workshop. An analysis done by

Economists Incorporated for the Interstate Natural

Gas Association of America shows that the

interstate takeaway capacity is 5,853,000 Mcf per

day. See, ‘‘Calif. Utilities Spurned Pipeline

Projects’’ in The Electricity Daily (May 18, 2001).

final Commission order approving or

denying a certificate will be issued.

David P. Boergers,

Secretary.

[FR Doc. 01–13359 Filed 5–25–01; 8:45 am]

BILLING CODE 6717–01–M

DEPARTMENT OF ENERGY

Federal Energy Regulatory

Commission

[Docket No. RP01–180–000; Docket No.

RP01–222–000]

Before Commissioners: Curt He ́bert,

Jr., Chairman; William L. Massey, and

Linda Breathitt San Diego Gas and

Electric Company and The Los

Angeles Department of Water and

Power; Order Requesting Comments

Issued May 22, 2001.

In response to petitions for relief

concerning high natural gas prices in

California, this order requests comments

on whether the Commission should

reimpose the maximum rate ceiling on

short-term capacity release transactions

into California, and the effects of such

action on the California gas market.

Background

1. On December 7, 2000, in Docket

No. RP01–180–000, San Diego Gas and

Electric Company (SDG&E) filed a

petition for emergency relief requesting

that the Commission immediately order

(1) that price-caps for short-term

releases of capacity for service to the

California border and to points of

interconnection between interstate

pipelines and California local

distribution companies (LDCs) be reimposed effective immediately and kept

in effect until March 31, 2001,1 and (2)

that sellers be required to state

separately the transportation and

commodity components of the bundled

rate for sales at these points so that the

cap can be enforced on these

transactions.2 Alternatively, SDG&E

asserted that the cap could be enforced

on such bundled sales through a

mechanism that caps bundled sales at

these points at 150 percent of the sum

of a reported average commodity sales

price plus the as billed rate for interstate

transportation.

2. On February 1, 2001, the Los

Angeles Department of Water and Power

(LADWP) filed a petition that requests

that the Commission immediately

rescind the portion of Order No. 637

that removed the price cap for shortterm capacity release and pipeline

capacity transactions for service to the

California border and to points of

interconnection between interstate

pipelines and California LCDs until

March 31, 2001. LADWP further

requests that the Commission initiate a

proceeding that will allow the

Commission to determine by March 31,

2001, whether the removal of the price

cap on short-term transactions

associated with California is warranted.

Public Notice and Interventions

Public notice of SDG&E’s filing was

issued on December 8, 2000.

Interventions and protests were due by

December 13, 2000. Public notice of

LADWP’s filing was issued on February

26, 2001. Interventions and protests

were due by March 2, 2001. Pursuant to

Rule 214 (18 CFR 385.214 (2000)), all

timely filed motions to intervene and

any motions to intervene out-of-time

filed before the issuance date of this

order are granted. Granting late

intervention at this stage of the

proceeding will not disrupt the

proceeding or place additional burdens

on existing parties.

With respect to SDG&E’s petition, a

number of California entities, including

the Public Utilities Commission of the

State of California (CPUC), California

local distribution companies (LDCs),

municipalities, and various business

concerns, filed comments in support of

granting the requested relief. Comments

in opposition to SDG&E’s petition were

filed by various parties, mainly by gas

marketers. Certain other commenters

such as the Indicated Shippers and the

Natural Gas Supply Association (NGSA)

supported reimposition of the price cap

on short-term capacity release

transactions but opposed any price cap

on bundled sales of gas or the gas

commodity. Since LADWP’s request for

relief is the same as SDG&E’s fewer

comments were filed in response to

LADWP’s petition. As with the SDG&E

petition, California entities support the

request for relief.

Discussion

SDG&E and LADWP request that the

Commission re-impose the price cap for

short-term releases of capacity for

service to the California border and to

points of interconnection between

interstate pipelines and California LCDs.

Their request for relief is based on the

assumption that high prices of gas

delivered at the California border are

due, in part, to the ability of persons

selling to the California market to charge

above the interstate pipeline’s

maximum tariff rate for the release of

pipeline capacity. SDG&E points to the

spot price at the California border of $50

per MMBtu for November and December

2000 as evidence of significant market

distortions requiring Commission

action.

In response to the requests filed by

SDG&E and LADWP, the Commission

Staff has been analyzing the capacity

release information pipelines are

required to maintain pursuant to section

284.13 of the Commissions’s

regulations. The Commission Staff has

examined capacity release information

for pipelines serving California for the

period from November 2000 through

April 2001. The Commission Staff’s

analysis in the attached Appendix

shows that there were very few capacity

transactions release transactions into

California that were above the pipelines’

maximum rates. For the period

November 2000 through April 2001, the

pipelines’ capacity release information

shows that releases above the pipelines’

maximum rates ranged from a high of

91,236 MMBtu/day for April 2001 to a

low of 7,000 MMBtu/day in December

2000. The interstate capacity into

California is approximately 7,435,000

Mcf/day 3 (an Mcf is roughly equal to an

MMBtu) and the intrastate receipt

capacity (takeaway capacity) is

approximately 6,675,000 Mcf/day.4

Therefore, the volume of capacity

Federal Register / Vol. 66, No. 103 / Tuesday, May 29, 2001 / Notices 29103

releases above the maximum tariff rate

as compared to the interstate capacity

into California ranges from a low of .09

percent for December 2000 to a high of

1.2 percent for April 2001.

In light of this information, the

Commission requests comment on

whether section 284.8(i), which states

‘‘[u]ntil September 30, 2002, the

maximum rate ceiling does not apply to

capacity release transactions of less than

one year,’’ should not apply to capacity

release transactions into California, that

is, the maximum rate ceiling would be

reimposed on short term capacity

release transactions into California prior

to September 30, 2002.

As part of this inquiry, the

Commission requests comment on the

following questions: (1) Would

reimposition of the maximum rate

ceiling on short-term capacity release

transactions into California have any

significant effect on the price of gas at

the California border; (2) Should the

reimposition of the maximum rate

ceiling on short-term capacity release

transactions be limited to California or

extended to pipelines delivering into

the Western Systems Coordinating

Council (WSCC) region; (3) What effect

do capacity release transactions have on

wholesale electric prices; (4) What

would be the effect of reimposing the

maximum rate ceiling on short-term

capacity release transactions into

California given firm shippers’ ability to

make bundled sales at the California

border; and (5) How will reimposing the

maximum rate ceiling for short-term

capacity release transactions into

California impact shippers’ ability to

obtain short-term firm capacity.

Any person interested in responding

to the questions discussed above should

file comments with the Commission

within 20 days of the date of this order.

The comments will be used in

determining what further actions should

be taken by the Commission in response

to the petitions filed in this proceeding.

The Commission Orders

Interested persons are directed to file

comments in response to the questions

posed above within 20 days of the date

of this order.

By the Commission.

David P. Boergers,

Secretary.

BILLING CODE 6717–01–M

29104 Federal Register / Vol. 66, No. 103 / Tuesday, May 29, 2001 / Notices

Federal Register / Vol. 66, No. 103 / Tuesday, May 29, 2001 / Notices 29105

29106 Federal Register / Vol. 66, No. 103 / Tuesday, May 29, 2001 / Notices

Federal Register / Vol. 66, No. 103 / Tuesday, May 29, 2001 / Notices 29107

29108 Federal Register / Vol. 66, No. 103 / Tuesday, May 29, 2001 / Notices

Federal Register / Vol. 66, No. 103 / Tuesday, May 29, 2001 / Notices 29109

[FR Doc. 01–13351 Filed 5–25–01; 8:45 am]

BILLING CODE 6717–01–C