On December 4, 2015, FERC granted a petition for declaratory order filed by Central New York Oil and Gas Company, L.L.C. (“CNYOG”) to provide interruptible park and loan storage service at market-based rates. CNYOG previously obtained Commission authorization to charge market-based rates for the storage and interruptible wheeling services it currently provides.
In its petition, CNYOG explained that it owns and operates the Stagecoach Storage Field, a depleted natural gas reservoir that has been converted to an underground natural gas storage facility and interconnected gas pipeline facilities. CNYOG further added that customers have previously expressed their interest in purchasing park and loan services from CNYOG. By proposing to add a park and loan rate schedule to its current FERC gas tariff, CNYOG explained that it would help complement the existing services it offers to customers, and provide them with parking and lending opportunities to help balance their natural gas supply positions.
In approving CNYOG’s request, the Commission followed the methodology provided in its Alternative Rate Policy Statement regarding whether a pipeline should be granted market-based rates. CNYOG submitted with its request for a declaratory order a comprehensive market power analysis, which the Commission determined satisfied the three prongs under its Alternative Rate Policy Statement—namely, CNYOG specifically and fully defined the relevant markets, passed the Commission’s market share and market concentration tests, and satisfied the ease of entering the market requirements. As a result, the Commission accepted CNYOG’s pro forma tariff records and directed CNYOG to file actual tariff records reflecting the approved language at least 30 days prior to the date the interruptible park and loan service commences.
A copy of the Commission’s order can be found here.