Tennessee Gas Pipeline Company

FIFTH REVISED VOLUME NO. 1

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Effective Date: 12/04/2009, Docket: RP91-203-077, Status: Effective

First Revised Sheet No. 409 First Revised Sheet No. 409

Superseding: Original Sheet No. 409

 

GENERAL TERMS AND CONDITIONS (continued)

 

 

Section 6. The cumulative difference shall reflect monthly carrying

charges for each month during the period February 1992 through June 1995

based on the applicable annual interest rate and methodology specified in

Section 5.1(c). All amounts shall be adjusted pursuant to Section 5.2.

 

5.1(b) Each month commencing July 1995, the balance in the Recoverable

Cost/Revenue Account shall be (i) increased by the amount of Recoverable

Eligible Costs paid by Transporter in that month, (ii) reduced by an

amount equal to the amount collected by the PCB Adjustments for that

month, as adjusted for discounting consistent with Sections 5.3 and 5.4,

(iii) reduced by any third party recoveries for that month as specified in

Section 6 and (iv) debited (in the event of a debit balance) or credited

(in the event of a credit balance) with carrying charges, calculated in

accordance with this Section 5.1.

 

5.1(c) All carrying charges shall be computed by using the greater of (i) an

annual interest rate of 10% for the period ending on June 30, 2009 and 8%

thereafter; or (ii) the then-applicable FERC-prescribed interest rate for

pipeline refunds pursuant to Section 154.67(c)(2)(iii)(A), or successor

provision, of the Commission's regulations. Carrying charges shall be

compounded quarterly and shall reflect adjustments for tax normalization

as set forth in Section 5.1(d).

 

5.1(d) The applicable annual carrying charge rate specified in Section 5.1 (c)

shall be converted to a monthly carrying charge rate and such monthly rate

shall be multiplied by the prior month's ending balance of the Recoverable

Cost/Revenue Account adjusted for any applicable deferred income taxes.

All income tax timing differences which are the result of differences

between the period in which expense or revenue enters into the

determination of taxable income and the period in which the expense or

revenue enters into the determination of pre-tax book income shall be

normalized.

 

5.2 The balances in the Recoverable Cost/Revenue Account shall be computed

after first adjusting all cost amounts and revenue (including TPR pursuant

to Section 6) amounts (exclusive of carrying charges) to 1992 dollars in

the following manner:

 

 

C1992 = Ci (I1992 / Ii), where

 

C1992 = Costs adjusted to 1992 dollars