Texas Eastern Transmission, L P
Seventh Revised Volume No. 1
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Effective Date: 11/16/2009, Docket: RP10-53-000, Status: Effective
Fifth Revised Sheet No. 528 Fifth Revised Sheet No. 528
Superseding: Fourth Revised Sheet No. 528
GENERAL TERMS AND CONDITIONS
(Continued)
Pipeline may reject all bids which would require Pipeline to discount below a rate and for
discount period agreeable to Pipeline. In the event Pipeline agrees to accept a rate that
is less than the applicable maximum tariff rate, Customer must submit a discount request
online via the LINK® System and Pipeline must approve such request pursuant to the
provisions of Section 28 of these General Terms and Conditions in order for such rate to
become effective.
(6) Pipeline shall review all bids from Replacement Customers received pursuant to Section
3.13(B)(4), which have not been rejected by Pipeline, to determine which bid is the "best
bid(s)". For purposes of this Section 3.13, the "best bid(s)" shall be the bid(s) which
yields to Pipeline the highest net present value. Net present value shall be calculated on
the basis of the present value of the Reservation Charge per unit to Pipeline except that
under a Negotiated Rate agreement with a minimum quantity, the net present value evaluation
shall also include the fixed cost component of the usage revenue at the minimum quantity.
In making the determination of net present value Pipeline shall apply the rate, as of the
date of the review, stated in accordance with Section 154.501(d) of the Commission's
regulations, to all bids.
(7) Upon receipt from Pipeline of the "best bid(s)", Customer shall have the right for a thirty
(30) day period in which to notify Pipeline in writing whether the Customer is willing to
match the "best bid(s)" for the capacity in whole or in part, made available by (i) the
termination of such service agreement, (ii) expiration of the contract term by its own
terms, or (iii) partial reduction pursuant to contractual right or the reduction of service
level pursuant to a right of first refusal. Commencing January 1, 2006, such notification
must be submitted online via the LINK® System. Failure to notify Pipeline within said
thirty (30) day period constitutes a non-revocable waiver of Customer's right to match the
"best bid(s)" and termination of the right of first refusal for the capacity. In order to
match the "best bid(s)", Customer must agree to a rate up to the maximum rate and contract
term that provide Pipeline with at least the same net present value, for an equivalent
amount of capacity, as the valid "best bid(s)" submitted by the Replacement Customer(s);
provided, however, the maximum rate a Customer must match is the maximum rate the Pipeline
can charge for delivery to the Customer's Point of Delivery under the Agreement which is
subject to the Customer's right to match the "best bid".
(8) In the event Pipeline does not receive any bids pursuant to Section 3.13(B)(4) or Pipeline
rejects all bids received due to the fact that such bids were premised on rate discount
levels or rate discount periods unacceptable to Pipeline, Pipeline and Customer may mutually
agree upon the terms and conditions under which Customer shall be entitled to retain its
capacity and continue to receive service. In no event shall Pipeline and Customer agree
upon terms which yield to Pipeline a net present value less than any bid received pursuant
to Section 3.13(B)(4) and rejected by Pipeline and in no event shall Pipeline be obligated
to sell capacity at less than the maximum lawful price for such capacity. In the event
Pipeline and Customer have not reached agreement on the terms and conditions under which
service will be extended, at Customer's election, such election to be exercised prior to the
date which is five Months before the termination date, Pipeline shall tender and Customer
shall execute within 20 days of receipt, a new service agreement reflecting service for all
or part of the contractual quantity, so long as such Customer agrees to pay the maximum
rate; provided, however, if Pipeline and Customer mutually agree to a lower rate which
yields to Pipeline a net present value equal to or greater than any bid received pursuant to
Section 3.13(C) and rejected by Pipeline, the Customer does not have to pay the maximum rate
to retain the capacity.
(9) In the event Pipeline and Customer do not execute a new service agreement pursuant to the
provisions of this Section 3.13(B), Pipeline shall have all necessary pregranted abandonment
authorization as to any part of the contractual quantity which is not covered by a new
service agreement. The new service agreement must meet all the requirements of the
definition of ROFR Agreement for Customer to continue to have the right of first refusal
pursuant to Section 3.13(B).