*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

**Second Revised Sheet No. 587 **Second Revised Sheet No. 587

Superseding: First Revised Sheet No. 587

GENERAL TERMS AND CONDITIONS

(Continued)

(2) If a Cash-out Party's imbalance is less than or equal to 5%, the monthly

Cash-out bill will be based on the monthly average Spot Index Price. If a

Cash-out Party's imbalance is greater than 5%, the monthly Cash-out bill

will be based on the accumulated sum of the results of the formulas listed

below such that and until the total monthly imbalance is fully accounted

for:

Imbalance

Level Factor Applicable Spot Index by Zone

0% - =<5% 1.00 lowest weekly

>5% - =<10% .90 (lowest weekly x quantity >5%) + level above

>10% - =<15% .80 (lowest weekly x quantity >10%) + levels above

>15% - =<20% .70 (lowest weekly x quantity >15%) + levels above

>20% - =<25% .60 (lowest weekly x quantity >20%) + levels above

>25% .50 (lowest weekly x quantity >25%) + levels above

The amount due Cash-out Party shall be determined by multiplying the

corresponding Imbalance Level Factor for the Month by the applicable Spot

Index Price for the applicable Zone times the actual quantities of excess

receipts or deficiency of deliveries for the Month. For Rate Schedule SCT

Customers, such Imbalance Level shall be determined after Pipeline

subtracts up to 4,828 Dth, from each Rate Schedule SCT Customer's total

monthly imbalance. Such amount subtracted up to 4,828 Dth will be Cashed-

out at the monthly average. When the Total Monthly Imbalance Percentage

is based on the operational imbalance level, actual quantities in excess

of that level will be multiplied by the Imbalance Level Factor

corresponding to the Total Monthly Imbalance Percentage.

(3) For imbalances due Cash-out Party in the Market Area Zone(s) where the

imbalance occurred, such imbalance quantity, if 5% or less, will be

multiplied by the applicable monthly average of the weekly Spot Index Price

for the four Access Area Zones. If such imbalance quantity is greater than

5%, it will be multiplied by the average of the lowest weekly Spot Index

Price for the four Access Area Zones.