Transcontinental Gas Pipe Line Company, LLC

Fourth Revised Volume No. 1

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Effective Date: 10/01/2009, Docket: RP09-971-000, Status: Effective

First Revised Sheet No. 478 First Revised Sheet No. 478

Superseding: Original Sheet No. 478






53. NEGOTIATED RATES (Continued)


53.3 Best Bid for Available Firm Capacity. For purposes of Section 49.2 of the General

Terms and Conditions, for negotiated rate bids proposing a reservation rate or other

form of revenue guarantee which exceeds the maximum applicable reservation rate, the

net present value calculated for the bid may not exceed a net present value that is

calculated assuming that the maximum applicable reservation rate shall be in effect

during the full term proposed in the bid, in place of the reservation rate(s) or other

revenue guarantee(s) proposed in the bid. As used in Section 49.2 and in this Section

53.3 "revenue guarantee" shall mean a volumetric or usage rate bid along with a

minimum throughput commitment. In performing a net present value evaluation of a

negotiated rate bid proposing a volumetric or usage rate along with a minimum

throughput commitment, Seller shall consider only the fixed costs proposed to be

recovered through the volumetric or usage rate bid in addition to any reservation rate

included in the bid.


53.4 Capacity Release. A negotiated rate shall not apply as a price cap for capacity

release transactions under Section 42 of the General Terms and Conditions. Capacity

release bids must conform to Section 42.7 (d) of the General Terms and Conditions.


53.5 Rate Treatment. Seller shall have the right to seek in future general rate

proceedings discount-type adjustments in the design of its rates related to negotiated

rate agreements that were converted from pre-existing discount agreements to

negotiated rate agreements, provided that the type of pre-existing service is not

altered as a result of the conversion to a negotiated rate. In those situations,

Seller may seek a discount-type adjustment based upon the greater of: (a) the

negotiated rate revenues received or (b) the discounted rate revenues which otherwise

would have been received.


53.6 Limitations. This Section 53 does not authorize Seller to negotiate terms and

conditions of service.




Subject to the further provisions of this Section 54, Seller shall distribute annually all

penalty revenue collected, net of costs, during each annual period, excluding cash out

penalty revenue, to firm and interruptible transportation and storage Buyers. "Net of costs"

means the costs resulting from the transactions that gave rise to the penalty amounts, which

are defined in Section 6.1 of Rate Schedule EESWS, Section 3.2(d) of Rate Schedule ISS,

Section 7.2 of Rate Schedule PAL, and Section 18.6 of the General Terms and Conditions

respectively. Each annual period shall consist of a twelve (12) month period ending July 31.

For each month during each annual period, Seller shall determine the Buyers that have not

incurred in that month any of the penalties subject to distribution pursuant to this Section

and, therefore, are eligible to share in the penalty revenue collected in that month.

Eligible Buyers will share in all penalty revenue collected during that month based on each

respective eligible Buyer's actual fixed cost contribution as a percentage of the total fixed

cost contribution of all eligible Buyers (exclusive of the fixed cost contribution pertaining

to service purchased by Seller 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, Seller shall post on its EBB the penalty revenue collected and

file a report with the Federal Energy Regulatory Commission and serve on Buyers and

interested State Commissions. If the penalty revenue collected during an annual period does

not exceed $100,000, Seller shall not distribute the penalty revenue to the eligible Buyers,

as determined above, but shall retain the penalty revenue for distribution to the eligible

Buyers following the end of the annual period during which the cumulative undistributed

penalty revenue collected exceeds $100,000. Any penalty revenue collected and retained by

Seller shall accrue interest calculated pursuant to Section 154.501(d) of the Commission's