Scg Pipeline Inc.

Original Volume No. 1

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Effective Date: 11/01/2003, Docket: RP03-611-000, Status: Effective

Original Sheet No.151 Original Sheet No.151 : Superseded









For each Month during each annual period, Pipeline shall determine the

Shippers that have not incurred in that Month any of the penalties subject to

distribution pursuant to this Section ("Non-Offending Shipper"),and therefore,

are eligible to share in the penalty revenue collected in that Month.

Pipeline shall distribute annually all penalty revenue net of costs collected

during each annual period net of costs to Non-Offending Shippers under firm

and interruptible transportation agreements with Pipeline. Each annual period

shall consist of a twelve (12) Month period ending July 31. Only

out-of-pocket costs incurred as a direct result of an offending Shipper’s

unauthorized overrun, failure to abide by an OFO, other misconduct and from

the transactions that gave rise to the penalty amounts shall be deducted from

the penalty revenue. Non-Offending Shippers will share in all penalty revenue

net of costs collected during that Month based on each respective

Non-Offending Shipper’s actual fixed cost contribution as a percentage of the

total fixed cost contribution of all Non-Offending Shippers (exclusive of the

fixed cost contribution pertaining to service purchased by Pipeline from third

parties) during that Month. The fixed cost contribution for any capacity

release transaction not subject to the maximum rate ceiling shall be capped at

the fixed cost portion of the maximum tariff rate that applies to the original

Shipper’s contract.


Following each annual period, Pipeline shall post on its Internet Web Site the

penalty revenue collected and file a report with the Commission and serve such

report on Shippers. If the penalty revenue collected during an annual period

does not exceed $50,000.00, Pipeline shall not distribute the penalty revenue

to the Non-Offending Shippers as determined above, but shall retain the

penalty revenue for distribution to the Non-Offending Shippers following the

end of the annual period during which the cumulative undistributed penalty

revenue collected exceeds $50,000.00. Any penalty revenue collected and

retained by Pipeline shall accrue interest calculated pursuant to the

regulations of the Commission.