Transcolorado Gas Transmission Company LLC
Second Revised Volume No. 1
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Effective Date: 12/28/2007, Docket: RP08-167-000, Status: Effective
Original Sheet No. 236 Original Sheet No. 236 : Effective
GENERAL TERMS AND CONDITIONS
6. CAPACITY RELEASE BY FIRM SHIPPERS (Continued)
EXAMPLE (5) Assume:
Capacity Release Request = 100,000/day for 5 years.
Maximum Bid Unit Bid Minimum
Volume Term Value Bid Volume
----------- ------- -------- ----------
Bid (a) 60,000/day 5 years $.18 60,000
Bid (b) 60,000/day 5 years $.18 50,000
Bid (c) 70,000/day 5 years $.18 65,000
Bid (d) 50,000/day 5 years $.18 15,000
Bid (e) 30,000/day 5 years $.18 10,000
Bid (f) 40,000/day 5 years $.17 0
Winning Qualified Bids: Bid (c) receives 70,000. Bid (d) receives 30,000.
Explanation: Again, there are many combinations of Bids (a), (b), (c), (d)
and (e) with the same Winning Bid Value. Pro rata allocation won't work,
because each Bid would receive 100/270 of the capacity; only Bids (d) and (e)
have low enough Minimum Bid Volumes for a pro rata allocation, and the sum of
Bid (d)'s and Bid (e)'s Maximum Bid Volumes is less than 100,000. Under
Section 6.10(d)(iii)(1)), we then look to the combinations of Bid(s) (a), (b),
(c), (d) and (e) to identify the Bid with the highest Maximum Bid Volume.
This is Bid (c). We allocate the highest volume to Bid (c) consistent with
creating the Winning Bid Value, so 70,000 is allocated to (c). This leaves
30,000 to be allocated. Bids(a) and (b) have the next highest Maximum Bid
Volume (60,000), but the Minimum Bid Volumes of Bids (a) and (b) are each too
high to receive the remaining capacity. The next highest available Maximum
Bid Volume is in Bid (d), which is allocated the remaining capacity of 30,000.