Centerpoint Energy Gas Transmission Company

Sixth Revised Volume No. 1

Effective Date: 01/01/2010, Docket: RP10-206-000, Status: Effective

First Revised Sheet No. 445B First Revised Sheet No. 445B

Superseding: Original Sheet No. 445B

GENERAL TERMS AND CONDITIONS

(continued)

10. ASSIGNMENT AND CURTAILMENT OF CAPACITY (continued)

(d) Transporter will evaluate the terms of the Pre-arranged

Service Agreement and all valid bids received during the

bidding period to determine which offers the highest total

net present value ("NPV") (discounted cash flow of

incremental revenues to Transporter). Incremental revenues

are those above and beyond any revenues to be received under

reservation/demand components (or other permissible

guaranteed revenue mechanisms) under pre-existing or

currently effective contracts or arrangements. Transporter

will use nondiscriminatory and objective posting, bidding

and evaluation criteria, which evaluation criteria

(including, but not limited to, the method of calculating

NPV, weighting of criteria to be used, etc.) Transporter

will specify in the open season posting, along with details

for method for breaking ties, submission of bids, and

announcement of award of capacity. Once an open season

commences, all requests for service using capacity subject

to these procedures must be submitted and evaluated under

the open season process. For purposes of NPV evaluation,

the aggregate NPVs of two or more bids for contiguous

service may be considered provided that the combined

capacity under those bids does not exceed the maximum

capacity available for bid. For Shippers willing to pay a

reservation rate or other form of revenue guarantee (e.g.,

advance reservation payment, exit fee, etc.) which exceeds

the maximum Tariff rate during all or part of the term, the

NPV calculated for the bid may not exceed an NPV that is

calculated assuming that the maximum applicable recourse

rate shall be in effect for the full term proposed;

guaranteed throughput volume service will be considered only

if permissible under the Tariff and applicable regulations.

Transporter may exclude from evaluation and deem ineligible

bids for service (i) that may detrimentally impact the

operational integrity of Transporter's system; (ii) that do

not satisfy all the terms of the specified posting; (iii)

that contain terms and conditions other than those set forth

in the Tariff; or (iv) by prospective Shippers which have

not demonstrated creditworthiness.