Discovery Gas Transmission LLC

Original Volume No. 1

Effective Date: 05/01/2010, Docket: RP10-539-000, Status: Effective

Second Revised Sheet No. 197 Second Revised Sheet No. 197

Superseding: First Revised Sheet No. 197

26. DISCOUNTING

26.1 Transporter may at any time, and in its sole discretion, selectively discount the rate applicable to

any Shipper under the FT-1, FT-2 and IT Rate Schedules set forth in this Tariff. Discounts will be

applied only to the Reservation Rate for FT-1 service and to the Usage Rate for FT-2 and IT service.

Such discounted rate(s) shall not be less than the Minimum Rate for the applicable service as set forth

in the currently effective Statement of Transportation Rates of this Tariff. Such discounts shall not

constitute material deviations from Transporter's pro forma Service Agreement.

Among other methods, a discounted rate may be based on published index prices for specific receipt

and/or delivery points or other agreed upon published pricing reference points (such discount rate may

be based upon the differential between published prices or arrived at by formula).

Any agreement containing such discounted rate shall specify the rate component(s) to be discounted

(i.e., Reservation Rate or Usage Rate or both). To the extent the Reservation Rate is discounted, the

index price differential rate formula shall be calculated to state a rate per MDRQ. Furthermore, such

discount shall not change the underlying rate design or include any minimum bill or minimum take

provisions that has the effect of guaranteeing revenue.

In addition, the discount agreement may include a provision that if one rate component, which was at or

below the applicable maximum rate at the time the discount agreement was executed, subsequently exceeds

the applicable maximum rate or is less than the applicable minimum rate due to a change in

Transporter's maximum (minimum) rates so that such rate component must be adjusted downward (upward) to

equal the new applicable maximum (minimum) rate, then other rate components may be adjusted upward

(downward) to achieve the agreed overall rate, so long as the net of the resulting rate components do

not exceed the maximum rate or are not less than the minimum rate applicable to that rate component.

Such changes to rate components shall be applied prospectively, commencing with the date a Commission

order accepts revised tariff sheets. If Transporter is unable to adjust rate components to achieve the

agreed overall rate or if the Commission determines that a particular discount is unlawful, then

Transporter and Shipper shall agree to a new rate within thirty (30) days of Transporter providing

notice to Shipper that such discounted rate requires renegotiation or the underlying service agreement

shall be terminated upon expiration of the thirty-day (30) renegotiation period. Nothing contained

herein shall be construed to alter a refund obligation under applicable law for any period during which

rates that had been charged under a discount agreement exceeded rates which ultimately are found to be

just and reasonable.

A discount agreement may also include a provision that (i) if the agreed-to rate would otherwise exceed

the applicable maximum rate, the excess will be kept track of by Transporter and charged Shipper at a

later time when the discount rate is below the applicable maximum rate, (ii) if Shipper agrees to pay

more than the discount rate in order not be interrupted, the additional amount paid will be kept track

of by Transporter and deducted from the discounted rate otherwise charged Shipper at a later time when

Shipper would not be interrupted, and (iii) to the extent Transporter makes a payment to Shipper (for

example, but not limited to contributions in aid of construction and refunds of net cash-out revenue),

Transporter may increase the discount rate otherwise charged Shipper at a later time. In all cases,

Shipper will not be charged a rate exceeding the applicable maximum rate or below the applicable

minimum rate.

A discount rate may apply:

(a) only to specified quantities under Shipper's Service Agreement(s);