Unbundled Service
Greater savings may be realized by customers who choose to reduce their services under an unbundled transportation rate. There are, however, risks that customers assume by reducing their purchase of backup service. Customers need to understand a few parameters:
Critical Day
Nicor Gas will declare a Critical Day when it is necessary to maintain the operational integrity of the company's system. A Critical Day will occur only between November 1 and April 30. On these days, storage withdrawals will be limited and use of company supplies will depend on a customer's service selections.
Operational Flow Order (OFO)
The company may impose an Operational Flow Order in order to adequately maintain its system. The company shall first request customers and suppliers to voluntarily take actions to alleviate the supply situation that is threatening operational integrity, to the extent possible. If such voluntary actions do not alleviate the situation, the company will implement an OFO.
Firm Backup Service (FBS)
With this service, customers can contract for an amount of company-supplied gas on a Critical Day or an OFO Shortage Day in addition to 2.3 percent (1.7 percent after June 1, 2006) of the customer's SBS capacity times any applicable Storage Withdrawal Factor (SWF).
Storage Banking Service (SBS)
Transporters can select their level of storage capacity. A selection of at least one MDCQ-day is required and a bank of 26 MDCQ-days (28 MDCQ-days after June 1, 2006) is available to all customers. SBS customers will be allowed Critical Day or an OFO Shortage Day withdrawal rights of 2.3 percent (1.7 percent after June 1, 2006) of their SBS capacity times their Storage Withdrawal Factor (SWF).
Storage Withdrawal Factor
Cycling gas in and out of our storage fields insures the continual efficient operation of the Nicor Gas storage system. Therefore, unbundled rate transportation customers have an incentive to fill to at least 90 percent of their selected storage capacity by November 1 of each year. If a transporter does not reach this goal, Nicor Gas will proportionally reduce the transporter’s storage withdrawal rights on a Critical Day or OFO Shortage Day. In other words, customers will have less than 2.3 percent (1.7 percent effective June 1, 2006) of their storage capacity available on a Critical Day or OFO Shortage Day if they do not have 90 percent of their capacity filled by November 1.
Recording Devices
Customers selecting unbundled transportation service will have their use and nominations balanced daily through the use of a recording device installed by Nicor Gas. The recording device requires a telephone line that must be provided by the customer.
About Our Gas Accounting Procedures
Gas is accounted for in the following order:
- Requested Authorized Use
- Deliveries of customer-owned gas
- Customer-owned gas withdrawn from storage
- Company-supplied gas under FBS
- Authorized Use
- Unauthorized Use or OFO non-performance
Important Note
On a non-critical day, if customer use is greater than deliveries, the remainder of gas requirements are met first from customer gas withdrawn from storage. Next, supplies are provided by Nicor Gas under Firm Backup Service (FBS) and charged at the Commodity Gas Cost (CGC). Finally, supplies are accounted for as Authorized Use and charged at the higher of either the Gas Cost (GC) or the market price.
On a Critical Day, requirements are met in the same order, but with some limits. Customers can only withdraw 2.3 percent (1.7 percent effective June 1, 2006) of their SBS capacity times any applicable SWF from storage. Additionally, Authorized Use – charged at the GC – is limited to company supplies up to the remainder of unused SBS withdrawal rights. The balance of any company supplies will be charged as Unauthorized Use at $6 per therm plus the higher of the GC or the market price on that day.
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