Balancing Service

Balancing Service

A. Daily Balancing and Maximum Hourly Flows
The Customer shall use its best efforts to achieve a balance between its gas deliveries and requirements on a daily basis. On any given Gas Day in the month, should the Company be in a penalty situation with its upstream pipelines, the Company shall assign imbalance penalties assessed to the Company by upstream pipelines to sales and transportation customers, based on the extent that each group caused such penalties. The portion of any such penalties assigned to transportation customers shall be further assigned to individual transportation customers based on the extent to which each transportation Customer caused such penalties. The penalties, if any, assigned to each transportation Customer, shall be assessed on the Customer’s monthly bill with appropriate supporting documentation.


Notices posted on the electronic bulletin board of Customer’s Transporting Pipeline that requires Customer to adhere to a maximum hourly flow rate, shall also be deemed notification to Customer that Maximum Hourly Flows will be in effect on Company’s distribution facilities for the same period as specified by the Customer s Transporting Pipeline. Customer’s Maximum Hourly Flow will be established by Company personnel based on an allocation of even hourly flows of daily receipts of gas scheduled in the relevant period in accordance with the applicable pipeline’s transportation tariff. All gas usage in excess of Customer’s Maximum Hourly Flow rate will be subject to an unauthorized overrun penalty of $2.00 per Ccf. Company will make a best efforts attempt to notify Customer of its Maximum Hourly Flow; however, it is Customer’s responsibility to contact Company personnel to obtain its Maximum Hourly Flow; however.

B. Monthly Cash Out of Imbalances
The Customer shall use its best efforts to achieve a balance between its gas deliveries and requirements on a monthly basis. Imbalances between the volumes of gas delivered for the Customer net of the applicable fuel reimbursement and the volumes of gas used by the Customer will be cashed-out each month so that no imbalances will be carried forward to subsequent months. Monthly imbalance penalties associated with the cash-out mechanism are based on the relative magnitude of the imbalance compared to Customer’s actual usage. Imbalances of less than the monthly tolerance of 5% are not subject to a monthly imbalance penalty.

The Company shall purchase all positive Period Imbalance quantities at the prices listed below:

Imbalance Levels Prices for Period Imbalances
0% to <5% 100% Period Index Price
>5% to <10% 90% Period Index Price
>10% to <15% 80% Period Index Price
>15% to < 20% 70% Period Index Price
>20% to <25% 60% Period Index Price
>25% 50% Period Index Price






The Customer shall purchase all negative Period Imbalance quantities at the prices listed below:

Imbalance Levels Prices for Period Imbalances
0% to <5% 100% Period Index Price
>5% to <10% 110% Period Index Price
>10% to <15% 120% Period Index Price
>15% to < 20% 130% Period Index Price
>20% to <25% 140% Period Index Price
>25% 150% Period Index Price






If at anytime during the month, Customer’s total imbalance level exceeds 30% of the total amount used in the prior month, the Customer will be required, upon 48 hours prior notice from the Company, to initiate corrective actions to balance its account within the following 10-day period.

C. Exchange of Imbalances
Customers may enter into agreements to trade offsetting imbalances up until two days after the close of the billing period during which the imbalances occurred. Upon Customer’s request, Company will provide Customer with data on the imbalances of other Customers that have previously authorized such disclosure. All imbalance exchange transactions must be confirmed to the Company in writing by both parties on or before the third day after the close of the billing period. Any Customer trading an imbalance may trade up to, but not beyond, a zero balance.  The Company has the right to reject any proposed trade arrangements if the marginal cost of the overtake quantity is significantly different from the avoided cost of the undertake quantity. By approving the proposed trade arrangement, the Company assumes no responsibilities for enforcing any of the terms of the arrangement between the parties to any such agreement.

D. Limitations of Balancing Service:
If the Company determines, at its sole discretion, that a transportation Customer is intentionally acting so as to financially gain from the provisions for Monthly Imbalance Charges or Credits as provided for in the Company’s Transportation Terms and Conditions, the Company shall, upon such a determination, first provide an Initial Notification of Balancing Limitations by telephone or telephone facsimile. The Initial Notification shall include a description of corrective actions that the Customer must take, and shall have a deadline of not less than twenty-four (24) hours for initiating the corrective actions. If the transportation Customer does not satisfy the requirements set forth in the Initial Notification, the Company shall issue a Second Notification of Balancing Limitations. Starting with the first full month following the issuance of the Second Notification, the Period Index Prices for positive imbalance quantities provided for in Section 5.B shall be increased by a Balancing Surcharge of $0.10 per Ccf and the Period Index Prices for  negative imbalance quantities provided for in Section 5.B shall be decreased by a Balancing Surcharge of $0.10 per Ccf. The Balancing Surcharge shall remain in effect until the transportation Customer satisfies the provisions of the Initial Notification of Balancing Limitations. The Company may charge the Balancing Surcharge of $0.10 per Ccf starting with the first full month after issuing a Notification of Balancing Limitations - Repeat Offender to any Customer that has been issued an Initial Notification according to the provisions of this section one (1) time previously in the last thirty (30) days or two (2) times previously in the last ninety (90) days. The Balancing Surcharge shall remain in effect until the transportation Customer satisfies the provisions of the Notification of Balancing Limitations -Repeat Offender.

The Company’s determination as to restrictions on Balancing Services pursuant to this section may be appealed to the Commission.