Oklahoma Administrative Code › Title 165 - Corporation Commission › Chapter 45 - Gas Service Utilities › Subchapter 17 - Competitive Bidding and Affiliate Transaction Rules for the Provision of Natural Gas Services of Gas Supply, Gathering, Transmission and Storage of Natural Gas Utilities Upstream of the Citygate › Section 165:45-17-1 - Purpose of this Subchapter

Current through Vol. 41, No. 20, July 1, 2024
(a)
				The purpose of Subchapter 17 is to establish a fair and reasonable process,
				wherein, the natural gas utility service industry can be restructured in such a
				manner that will be in the best public interest of all natural gas consumers,
				and that would complement and improve the state's economic growth by increasing
				its market base for Oklahoma's greatest natural resource, natural gas. To
				accomplish this two-fold objective, Subchapter 17 provides for the unbundling
				of the currently bundled services of gas supply, transmission, storage and
				gathering upstream of the citygate by the utility, and further provides that
				these services be competitively bid by entities desiring to participate in a
				competitive market. Accordingly, the Commission believes that a competitive
				bidding process is among the most effective means to achieve these objectives.
				Therefore, it is the policy determination of the Commission that competitive
				bidding and an unbundling process be utilized by natural gas utilities, and
				further, the Commission expects Oklahoma gas utilities to comply with this
				policy determination of the Commission.
(b) It is not the intent of Subchapter 17 to
				be applicable to downstream unbundling or competition.
(c) Since it is recognized that competitive
				bidding is not the only means to acquire and receive reliable and least cost
				natural gas services, this Subchapter also allows for other processes to be
				proposed by the utility for Commission consideration to acquire and receive
				those services. A utility seeking to propose processes other than competitive
				bidding must notify and obtain Commission approval, after notice and hearing,
				within thirty (30) calendar days prior to implementation of those processes in
				nonemergency situations. In emergency situations, the utility must notify the
				Commission within thirty (30) calendar days following implementation.
(d) Failure to utilize competitive
				bidding to obtain the natural gas services of gas supply, gathering,
				transmission and storage at the least cost, shall subject the utility to a
				prudency review, as defined in OAC
				165:45-1-2, by the Commission.
				Subsequent to this review, after notice and hearing, the Commission shall make
				a determination as it deems necessary and proper, including, but not limited
				to, disallowance of recovery of the difference between the market price and the
				price at which the natural gas services were purchased.
(e) It is the intent of the Commission to
				create a fair and nondiscriminatory competitive market for natural gas
				services. It should not be construed that this Subchapter absolves or relieves
				any utility, competitive bidder, or downstream marketer or provider from any
				duty prescribed by the laws of the State of Oklahoma or the United States
				including, but not limited to, any state or federal law regarding contractual
				rights and obligations, antitrust enforcement or liability, or laws against
				improper restraint on trade or "takings" of property.
(f) This Subchapter also establishes
				reasonable standards of conduct for transactions between the natural gas
				utilities and their affiliates conducting business on the utility-owned
				transmission pipeline within the State of Oklahoma, and for competitive
				bidders.
(g) To ensure that the
				public interest is best served by the restructuring of the natural gas
				industry, the Commission may implement a consumer education program of its own
				design. The Commission may seek assistance of those parties directly or
				indirectly involved in the retail sale of natural gas.
Added at 15 Ok Reg 2177,
				  eff 7-1-98