Mid-Atlantic Natural Gas Contingency Planning Group
Emergency Assistance Plan
TABLE OF CONTENTS
I. INTRODUCTION ………………………………………………….2
II. FORWARD ………………………………………………………4
III. CONTINGENCY PLAN ………………………………………6
IV. PARTICIPATING COMPANIES ……………………………12
V. CONTACTS / ASSETS ………………………………………14
Ø LDC / OTHER
Ø PIPELINES
I. INTRODUCTION ___________________________________________________________
During the last quarter of 1995, Natural Gas Contingency Supply Plans for the states of Maryland and Virginia were formally reviewed, and separately approved, by both the Maryland Gas Operator's Advisory Committee (GOAC) and the Virginia Gas Operation's Association. The Maryland Plan was published in January 1996 while the Virginia Plan was published in December 1995. Both Plans resulted from a collaborative effort involving representatives from local gas distribution companies (LDCs) within each state, and from the gas transmission pipelines which deliver gas supplies to the LDCs, who served on separate, related task groups.
Since two of the LDCs (Washington Gas and Columbia) and three of the pipelines (Columbia Gas Transmission Corporation, CNG Transmission Corporation and Transcontinental Gas Pipeline Corporation) have a presence in both states, it was subsequently determined that a merger of the Maryland and Virginia Contingency Plans/Directories would be practical/sensible and would further enhance the ability for LDCs to find assistance when/if needed. It was also determined that participation in the Plan should not be limited only to LDCs, but should include shippers within the operating areas who hold or manage firm transportation which may be of assistance in a supply emergency.
As a result of the aforementioned merger of the Maryland and Virginia Contingency Supply Plans, and the addition of non-LDC holders of firm pipeline capacity to the merged plan and directory, the two separate planning groups joined together and produced the first Maryland/Virginia Natural Gas Contingency Supply Plan/Directory for use during the 1997-98 winter period. In so doing, the participants resolved that this plan:
"Purposely contains no binding requirements, Encourages participation on a voluntary basis, and Does not relieve any company of the responsibility to maintain sufficient supply deliverability on a day to day basis."
While still primarily concentrating on the Virginia / Maryland geographic area, we were concerned our name could limit participation. Specifically, that some neighboring, strategically located capacity holders may not participate due to our name referencing a specific state. At the Spring 2001 meeting held in Baltimore, MD, a motion carried to change the name of the group to the Mid-Atlantic Natural Gas Contingency Supply Planning Group.
II. FOREWORD ____________________________________________________________
The development of the Mid-Atlantic Natural Gas Contingency Supply Plan was precipitated by a need within the industry for a "Plan" addressing how local distribution companies in the region respond to a supply emergency which prompts a situation threatening a company's ability to serve its firm customer requirements. A workable Plan would:
a) require a collaborative effort from industry representatives most closely involved with supply planning and deliverability, and b) (b) would seek, and be dependent upon, voluntary participation/cooperation.
With these two factors in mind, the planning groups from the respective states recognize the need for a simple, yet specific, Plan which places foremost emphasis upon:
Maintenance of continuous service to high priority, essential human needs customers; Responsible planning, management and operations by all companies; Voluntary cooperation among the companies in the event of a supply emergency; and · Guidance with regard to how participating companies may be remunerated when assistance gas is provided.
The following Plan results from a very extensive and deliberate process involving representatives from Maryland and Virginia gas distribution companies, gas transmission pipelines, municipalities and other holders of firm pipeline capacity. This process began in the summer of 1995 and remains a continual effort. In the process of developing the Plan, the participating companies identified a need to conduct periodic review meetings to assess the need for revisions to the Plan, to discuss summer/winter period operations/experiences, and to develop, conduct and evaluate "mock" supply emergency scenarios (to put the Plan and its participants to test).
To facilitate this effort the participants plan on meeting a minimum of two times each year, typically in the second and fourth quarters. Included with the Plan is a directory containing pertinent information for each company which is intended to facilitate timely and informed communications. This information was updated in the third quarter of 2001.
In the event you should have any questions related to the Mid-Atlantic Plan, please contact the chairperson or vice-chairperson.
III. MID-ATLANTIC NATURAL GAS CONTINGENCY SUPPLY PLAN
Mission
To plan and coordinate those activities that ensure continuous service to firm natural gas customers in the states of Maryland and Virginia consistent with regulations promulgated by the Public Service Commission of Maryland, and by the Virginia State Corporation Commission in Case No. PUE 900053. Foremost emphasis is placed on maintenance of supply to high priority, essential human needs customers.
(In consideration that participation in this plan is voluntary, and that our industry is in continued transition, it is recognized that steps over and above those identified herein may be necessary and that the plan should be subject to periodic review).
Objectives
1. Define industry actions aimed at improving reliability of service and which advocate and coordinate their implementation. 2. Develop a contingency planning process that would respond to any immediate, short-term reduction in natural gas deliverability which would be specifically designed to: a. protect public health, safety, and welfare; b. manage scarce energy supplies equitably in a manner consistent with applicable statutes and regulations; and c. help preserve the image of natural gas as a safe, reliable, economical source of energy. 3. Create operating guidelines which: a. provide the flexibility required to meet a broad range of supply disruptions that may have materially different consequences upon market(s) served, dependent upon geographic location affected, or time of year when disruption occurs; b. rely on voluntary rather than mandatory strategies; c. minimize delays in effectively and efficiently responding to disruptions; d. promote cooperation within the industry during disruptions; and e. provide for routine interaction (meeting/drill) throughout the year among the key industry players whose action would be required during a natural gas disruption.
Goals
Provide a mechanism to assist each participating company in maintaining its firm obligations solely and specifically in the event of an unexpected disruption. This mechanism is not intended to serve as substitute for any company maintaining sufficient capacity and/or supply aggregation capability.
Disruption Definition
Disruption shall be defined as an occurrence, beyond the direct control of the participating company, under which the company experiences a loss of firm supply or firm transportation that prevents the company from completely serving its firm market.
Application
This plan should be followed in the event of a major reduction in firm gas supply or firm transportation capacity including, but not limited to: 1. Facility failure on the system of a local distribution company (LDC) or interstate pipeline(s) delivering to the LDC or other participating company. 2. Short-term loss of firm gas supply. 3. Pipeline curtailment of firm contract services. 4. Shortage of storage inventory or peak shaving feedstock (other than that resulting from insufficient seasonal supply planning) or peak shaving production outages. 5. Extreme temperature conditions that exceed prudent peak day and seasonal supply design criteria.
Operating Procedure
This procedure is divided into three parts. Phase A is largely the responsibility of the company experiencing the disruption. Phases B and C will be initiated only after Phase A has been completed and may involve all other companies participating in the Maryland/Virginia Natural Gas Contingency Supply Plan on a voluntary basis.
Phase A
The company experiencing the disruption is expected to take all of the following steps as applicable prior to requesting voluntary assistance from other companies. The order of procedure of these items may be changed to suit the individual company's tariff provisions. 1. Fully utilize the company's supply portfolio, including operating peak-shaving production facilities, obtain additional supplies and/or capacity from reasonably available sources(a) and, in the case of an LDC, full curtailment of service to interruptible customers consistent with their respective service contracts with the LDC. Assistance or relief should be requested from the applicable intrastate or interstate pipeline pursuant to the pipeline's tariff. 2. Notify applicable customers with dual-fuel capability to switch to alternate fuel use, as respective tariff allows. 3. Reduce company use of natural gas to the extent possible. 4. Solicit voluntary demand reductions. 5. Implement all other tariff provisions that limit or reduce demand. (a) May include pipelines, marketers, holders of firm pipeline capacity, and non-Virginia or Maryland companies.
Phase B
If, after following the procedure in Phase A, the requested company is in need of further assistance it will then: 1. Contact potential assisting Maryland or Virginia companies to request gas supplies and/or transportation capacities that do not require restriction of service to interruptible customers by the assisting company(ies) and can be made available to the requesting company. The requesting company should indicated the quantity of gas and/or transportation capacity requested, an estimate of length of time either will be needed, and make known that the request is being made pursuant to this procedure; 2. The requesting and assisting companies will notify, if applicable, appropriate State Corporation or Public Service Commission personnel of the situation and planned course of action.
Phase C
If further assistance is required to ensure service to the requesting company's firm requirements, the following additional coordinated activity will take place among the company's participating in the Plan. 1. Potential assisting companies will be contacted and are encouraged, but not required, to implement their own load reduction and peak shaving procedures in order to enable them to render assistance. 2. Potential assisting companies are not encouraged to provide assistance if such assistance would threaten service for essential human needs or would cause the breach of any contract or the contravention of any tariff requirement, rule, regulation, or order of an administrative agency or court having jurisdiction over the matter. 3. As in Phase B, the requesting and assisting companies will notify, if applicable, appropriate State Corporation or Public Service Commission personnel of the planned course of action and projected net ending results.
Compensation
The terms and methods of repayment or compensation for the assistance gas or capacity provided to a requesting company by an assisting company shall be as follows when/where applicable: The assisting company shall be reimbursed for (I) actual volumetric gas or alternate fuel costs, volumetric transportation charges, volumetric storage withdrawal charges incurred, (ii) the gross sales margin lost by the assisting company(ies) due to diversion of gas and/or transportation capacity to the requesting company, and (iii) any other legitimate and reasonably incurred direct or indirect expenses as agreed to by the companies involved which may include the cost of purchasing the product that would have otherwise been produced using the quantity of gas made available by the assisting company. To the extent possible, assisting companies should quantify the total estimated cost at the same time available supply/quantities are made known. Repayment shall be tendered by the requesting company to the assisting company(ies) within 30 days of receipt of an invoice from the assisting company(ies) providing an accounting of the repayment. As an alternative in the event an assisting company would prefer to repaid in kind, i.e. a volumetric exchange, such transaction and any associated or extraordinary costs, as noted above, may be negotiated by the two companies at the time any supply quantities are volunteered.
General
1. In Phases B and C, the requesting company will coordinate the efforts of the assisting company(ies) in the most efficient, least disruptive manner possible. 2. If, in Phase B or C, a transfer of supply or capacity requires authorization by a delivering pipeline, the requesting company will coordinate the necessary transaction with the applicable pipeline(s). The assisting company(ies) will also provide appropriate confirmation to the applicable pipeline(s). 3. All plan participants are encouraged to provide assistance when requested. 4. If requested by the assisting company(ies), the requesting company will provide written documentation supporting its request for assistance. 5. An assisting company will not be liable for any damages, liabilities, outages or other related problems on the system of the requesting company associated with the implementation of this plan. 6. In Phases B and C, the requesting company should state an hourly/daily quantity it needs to the assisting company (e.g. 2,000 Dth/Hour for 10 hours or 20,000 Dth for the day). 7. As noted in the Compensation section, the assisting company should provide an approximate cost per Dth to the requesting company. 8. Both the requesting and assisting companies are encouraged to maintain communications throughput the day in recognition that conditions and needs may change. 9. Although changing conditions may prompt a reduction in requested volumes, the requesting company may be required to take the original daily amount order, if arrangements cannot be made to change nominations (by requesting or assisting company) or it is physically impossible to reverse actions taken (e.g. the assisting company ran 20,000 Dth of propane into its system over a 3 hour period). 10. The assisting company has the right to reduce original amounts granted to the requesting company if changing conditions warrant such action and the necessary arrangements can be made with the pipelines involved (e.g. updated temperatures are 10 degrees colder than originally estimated, so the assisting company may take back unused volumes based on prorated basis.)
This plan will be subject to annual review by a committee comprised of personnel from participating companies and the Directory will be updated prior to the commencement of each winter season.
MID-ATLANTIC NATURAL GAS SUPPLY CONTINGENCY PLAN LDC / TRANSPORTER PARTICIPANTS
Company Pipeline Sources
Allied Signal Columbia
Atlanta Gas (VNG) Columbia, Transco, Dominion
Baltimore Gas & Electric Columbia, Transco, Dominion
Bluefield Gas Co. Columbia, Bluefield Pipeline (Intra)
City of Charlottesville Columbia
Chesapeake Utilities Eastern Shore
City of Danville,VA Transco
Columbia Gas/MD Columbia
Columbia Gas/VA Columbia, Transco
Doswell Partners Dominion
Easton Utilities Columbia
PFG Columbia
City of Richmond Columbia, Transco, Dominion
Roanoke Gas Co. Columbia, East Tenn., VA Gas (Intra)
Southwest VA Gas Transco
Washington Gas Light Columbia, Transco, Dominion
MID-ATLANTIC NATURAL GAS SUPPLY CONTINGENCY PLAN PIPELINE AND STORAGE PARTICIPANTS
Company
Columbia Gas Transmission
East Tennessee Natural Gas
Dominion Transmission
Transcontinental Gas Pipeline
Cove Point LNG
Virginia Gas Pipeline