CPUC Both Approves and Holds SoCal Gas Market Rules

The California Public Utilities Commission on April 1 narrowly adopted rules to implement a complex settlement that changed policy regulating the transportation and storage of natural gas on Southern California Gas?s system?then put the rules on ice. The rationale for this move was that the gas market has changed significantly since the deal was approved in 2001 and a current proceeding is looking at statewide gas policies and strategies. Known as the ?comprehensive settlement agreement,? the deal established customer access to firm tradable rights to move gas on the SoCal Gas system. The provision is meant to provide assurance that gas will be delivered where customers will need it. A secondary market was also established, meaning that customers could sublease capacity on the utility?s pipeline. While commissioner Geoffrey Brown said the delay in approving the agreement and changes in the market require reexamination of the deal, ?strong elements of the agreement could be imported into the framework of the current gas market,? such as firm tradable rights and a secondary market for those rights. Over objections by SoCal Gas, one of the rules adopted would require the company to post information on price, quantity, and terms of gas storage contracts. The utility had asserted it was not required to post such information. Commissioner Loretta Lynch?s unadopted alternate plan would have scrapped the settlement on grounds that the gas market has changed so much since its approval that the findings are no longer accurate. She also said the rules could create opportunities to manipulate the market. Along with commissioner Carl Wood, Lynch voted in the minority against the approved rules, which will be put into place pending a decision from the current gas rulemaking.

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CPUC Both Approves and Holds SoCal Gas Market Rules

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