Tennessee Gas Pipeline Company

FIFTH REVISED VOLUME NO. 1

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Effective Date: 08/01/2004, Docket: RP04-355-000, Status: Effective

First Revised Sheet No. 382 First Revised Sheet No. 382 : Effective

Superseding: Original Sheet No. 382

GENERAL TERMS AND CONDITIONS (continued)

XXI. RESEARCH, DEVELOPMENT AND DEMONSTRATION RATE ADJUSTMENT

The rates for Transporter's jurisdictional services shall be adjusted from time

to time to reflect changes in Transporter's expenditures for Research,

Development and Demonstration (RD&D), in accord with the procedures herein

specified.

1. Filing of RD&D Rate Adjustment

1.1 Effective Rate after RD&D Rate Adjustment: The effective rates

under Transporter's Rate Schedules as reflected in the Summary of

Rates and Charges in Volume No. 1 of Transporter's FERC Gas Tariff

shall be the Rates After Current Adjustment for each applicable

rate schedule reflecting the Current RD&D Rate Adjustment under

this Article XXI.

1.2 Effective Date of Adjustment: The Effective Date of Adjustment

for each Current RD&D Rate Adjustment filed pursuant to Section 2

hereof shall be the date specified in Transporter's filing and

shall be the first day of a month; provided, however, that Current

RD&D Rate Adjustments shall be made effective no more frequently

than semiannually. The Current RD&D Rate Adjustment shall become

effective on the Effective Date of Adjustment without suspension;

provided, however, that such Current RD&D Rate Adjustment shall be

subject to reduction and refund of any portion found after hearing

to be unjustified by a final and nonappealable Commission order.

Any refunds under this Article shall include simple interest at

the interest rate specified in Section 154.67 of the Commission's

Regulations under the Natural Gas Act.

1.3 Filing Procedure: At least thirty days prior to the Effective

Date of Adjustment, Transporter shall file with the Federal Energy

Regulatory Commission and post, as defined by Section 154.16 of

the Commission's Regulations, revised Tariff Sheets showing for

each of Transporter's applicable Rate Schedules, the Base Tariff

Rates and the Rates After Current Adjustment reflecting the

Current RD&D Rate Adjustment determined in accord with this

Article. Such filing shall include (1) detailed computations

showing clearly the derivation of such current RD&D Rate

Adjustment and (2) a statement as to the anticipated scope and

objective of the RD&D and the relationship of such objective to

the service for which the RD&D adjustment is to apply. Such

supporting data shall be in lieu of any other data or supporting

materials required by the Commission's Regulations under the

Natural Gas Act. The filing by Transporter, or the making

effective, of rate changes under procedures other than this

Article shall have no effect upon the right and duty of

Transporter to make changes under this Article.