Iroquois Gas Transmission System, L.P.

FIRST REVISED VOLUME NO. 1

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Effective Date: 08/16/2004, Docket: RP98- 18-016, Status: Effective

Substitute Original Sheet No. 6E Substitute Original Sheet No. 6E : Effective

Superseding: Original Sheet No. 6E

7/

Eastchester Credits. To the extent that either through a FERC-

approvedsettlement agreement or through its Gas Tariff, Iroquois'

firm Eastchesterrecourse rate is or would have been effectively

reduced on a 100% load factorbasis to less than $0.59/Dth by

Eastchester Credit(s), then Virginia Powershall receive a refund

or credit to its rate to reflect the same effectivelyreduced rate

on its year-round capacity position of 20,000 Dt/day during

theperiod July 1, 2004 through January 1, 2008 or the period that

the RP04-136rates are effective, whichever is longer. "Eastchester

Credits" shall includeany credits, payments, remittances, refunds,

adjustments or the like relatedto insurance proceeds, litigation

costs, civil judgments and restitutions orsimilar items recovered

by Iroquois from claims and/or legal or regulatoryproceedings

related to the construction of the Eastchester Project,

nettedagainst any litigation costs, civil judgments, and

restitutions renderedagainst Iroquois from claims and/or legal or

regulatory proceedings relatedto the initial construction of the

Eastchester Project [hereinafter "Eastchester Costs"]. In

determining the amount of the Eastchester Credit,Iroquois shall:

(1) calculate an implied initial annual revenue stream basedupon

the RP04-136 recourse rate and the billing determinants of230,000

Dt/day; and (2) on the earlier of December 31, 2011 or the date

the Eastchester Credit can be accurately quantified, Iroquois

shall then deduct10% of the Eastchester Credit from such implied

initial annual revenue stream(in order to spread such Eastchester

Credit over the ten year period of therate) and recalculate a new

implied rate by dividing this new revenue streamby the billing

determinants. Refunds or credits will be provided to Virginia

Power to the extent such resulting implied rate is less than

$0.59/Dth; suchrefunds or credits shall include interest as

calculated at the FERC-approvedinterest rate.8/ In the event that

after June 1, 2004, Iroquois executes with any otherEastchester

Shipper (defined for purposes of this rate sheet as (KeySpan-

Ravenswood, LLC, Consolidated Edison Company of New York,

Inc.,Virginia Power Energy Marketing, Inc., and Reliant Energy

Services, Inc.))or an affiliate of an Eastchester Shipper a

settlement agreement,negotiated rate agreement, or discounted rate

agreement for Eastchester capacity and that settlement, negotiated

rate, or discounted rateagreement (1) resolves rate issues as

between such Eastchester Shipper andIroquois in Docket No. RP04-

136, regardless of whether such Eastchester Shipper was an active

participant in that proceeding; and (2) provides for arate given

to such other Eastchester Shipper or its affiliate for the

remainder of the primary term of its Eastchester service agreement

that isless on a 100% load factor basis than $0.59/Dth exclusive

of surchargesand/or that has discounted or eliminated surcharges,

then Virginia Power willreceive such lower rate and/or

surcharge(s) or will have such surcharge(s)terminated effective as

of the same date(s) as they are received by suchEastchester

Shipper or affiliate pursuant to its year-round capacityposition

of 20,000 Dt/day for the term of its service agreement.9/ This

Letter Agreement resolves any and all issues in Iroquois' Docket

No.RP04-136 related to the Eastchester rates for Rate Schedule

RTS; provided,however, that Virginia Power does not waive any of

its rights to participate inthe proceedings in Docket No. RP04-136

on issues concerning the quality ofVirginia Power's Eastchester

service, the terms and conditions of suchservice, or new services.