Transcontinental Gas Pipe Line Company, LLC 2800 Post Oak Boulevard (77056) P.O. Box 1396 Houston, Texas 77251-1396 (713) 215-2000 May 19, 2011 Federal Energy Regulatory Commission 888 First Street, N.E. Washington, D.C. 20426 Attention: Kimberly D. Bose, Secretary Reference: Transcontinental Gas Pipe Line Company, LLC Staten Island Heater Facility Surcharge Docket No. RP11- Ladies and Gentlemen: Transcontinental Gas Pipe Line Company, LLC ( Transco ) submits herewith for filing with the Federal Energy Regulatory Commission ( Commission ) copies of two executed service agreement amendments that contain a negotiated facilities surcharge under Transco s Rate Schedule FT: amendment dated May 19, 2011 between Transco and The Brooklyn Union Gas Company d/b/a National Grid NY ( BUG/National Grid NY ) 1 and amendment dated May 19, 2011 between Transco and Keyspan Gas East Corporation d/b/a National Grid ( LILCO/National Grid ). 2 The facilities surcharge is for the reimbursement of costs to construct the Staten Island Heater Facility and appurtenant facilities. The effective date of the surcharge is May 20, 2011, the anticipated in-service date of the Staten Island Heater Facility. Transco submits the amendments for inclusion in Original Volume No. 1A of Transco s FERC Gas Tariff. Statement of Nature, Reasons and Basis BUG/National Grid NY and Transco are parties to a service agreement dated February 1, 1992, as amended, for firm transportation under Transco s Rate Schedule FT (Transco contract no. 1003682). LILCO/National Grid and Transco are parties to a service agreement dated February 1, 1992, as amended, for firm transportation under Transco s Rate Schedule FT (Transco contract no. 1003687). BUG/National Grid NY, LILCO/National Grid, and 1 2 Formerly The Brooklyn Union Gas Company. Formerly Long Island Lighting Company.
Federal Energy Regulatory Commission May 19, 2011 Page 2 Transco are parties to a Construction, Operation and Facilities Reimbursement Agreement dated March 23, 2010 ( Facilities Agreement ) for the construction of the Staten Island Heater Facility in Staten Island Borough, New York City, New York. Pursuant to the Facilities Agreement, Transco and BUG/National Grid NY and Transco and LILCO/National Grid have executed amendments to the respective service agreements to incorporate an Exhibit C to the service agreements to set forth a separately stated negotiated facility surcharge for the Staten Island Heater Facility s construction cost reimbursement. As stated on Exhibit C, the negotiated facility surcharge will be charged in addition to the rates, charges, surcharges and fuel payable by BUG/National Grid NY and LILCO/National Grid in accordance with Transco s Rate Schedule FT for a term of five years commencing on the ready for service date of the Staten Island Heater Facility. Exhibit C also includes provisions for adjustment to the facility surcharge based on the actual final cost of the Staten Island Heater Facility. In addition, the amendments provide for an extension of the terms of the service agreements until June 1, 2016. Accordingly, pursuant to the Commission s Alternative Rate Policy Statement, for which the Commission has approved tariff sheets under Transco's Rate Schedule FT that permit Transco to negotiate rates, 3 and Section 20.7 of the General Terms and Conditions of Transco s FERC Gas Tariff, 4 Transco submits herewith for filing with the Commission the amendments to service agreements setting forth the negotiated facilities surcharge for the Staten Island Heater Facility. 5 The amendments include the exact legal name of the customer, the applicable charge, and the applicable rate schedule for the service. The receipt and delivery points and the quantity of gas to be transported under the service agreements remain unchanged. Transco affirms that the service agreements, as amended, do not deviate in any material aspect from the Rate Schedule FT form of service agreement in Transco s FERC Gas Tariff. Effective Date As noted above, the effective date of the negotiated rate is May 20, 2011, the anticipated inservice date of the Staten Island Heater Facility. Transco respectfully requests that the Commission grant any waivers that it may deem necessary to accept this filing as requested herein. 3 Alternatives to Traditional Cost-of-Service Ratemaking for Natural Gas Pipelines and Regulation of Negotiated Transportation Services of Natural Gas Pipelines (Alternative Rate Policy Statement), 74 FERC 61,076 (1996), reh'g and clarification denied, 74 FERC 61,194 (1996), reh'g denied, 75 FERC 61,024 (1996). Transcontinental Gas Pipe Line Corp., 76 FERC 61,318 (1996) (see Section 3.5 of Transco s Rate Schedule FT). 4 The facility surcharge has been negotiated pursuant to the provisions of Section 20.7(b), and provides for a reimbursement of capital costs, including carrying charges, over a 5 year period. 5 The Commission approved similar negotiated facilities reimbursement charges in Northern Natural Gas Co., 94 FERC 61,067 (2001), and in Transcontinental Gas Pipe Line Corp., Docket No. RP96-359-016 (by Letter Order Pursuant to Section 375.307(f)(1) and f(3) issued on June 20, 2003).
Federal Energy Regulatory Commission May 19, 2011 Page 3 Materials Submitted Herewith In accordance with Section 154.7(a)(1) of the Commission s regulations, the following material is submitted herewith: An etariff XML filing package, filed as a zip (compressed) file, containing: 1. Copies of the executed May 19, 2011 amendments submitted as whole documents in PDF format; 2. A transmittal letter in PDF format; and 3. A copy of the complete filing in PDF format for publishing in elibrary. Posting and Certification of Service In accordance with the provisions of Section 154.2(d) of the Commission s Regulations, copies of this filing are available for public inspection, during regular business hours, in a convenient form and place at Transco s main office at 2800 Post Oak Boulevard in Houston, Texas. In addition, Transco is serving copies of the instant filing to its affected customers and interested state commissions. Any communications in regard to this filing should be sent to: Stephen A. Hatridge Senior Counsel Transcontinental Gas Pipe Line Company, LLC P.O. Box 1396 Houston, Texas 77251 (713) 215-2312 stephen.a.hatridge@williams.com Respectfully submitted, TRANSCONTINENTAL GAS PIPE LINE COMPANY, LLC By Marg Camardello Manager, Certificates & Tariffs 713-215-3380 marg.r.camardello@williams.com
Transcontinental Gas Pipe Line Company, LLC FERC NGA Gas Tariff Original Volume No. 1A Effective Date: May 20, 2011 Contract No. 1003682 The Brooklyn Union Gas Company d/b/a National Grid NY, Amendment dated 5/19/2011 Option Code: A
SECOND AMENDMENT TO SERVICE AGREEMENT THIS SECOND AMENDMENT TO SERVICE AGREEMENT ("Amendment") is entered into as of AlIA y t9'", '2rl>f (, by and between TRANSCONTINENTAL GAS PIPE LINE COMPANY, LLC (formerly Transcontinental Gas Pipe Line Corporation), a Delaware limited liability company, hereinafter referred to as "Seller." first party, and THE BROOKLYN UNION GAS COMPANY D/B/A NATIONAL GRID NY (formerly The Brooklyn Union Gas Company), hereinafter referred to as "Buyer," second party. WITNESSETH WHEREAS, Seller and Buyer are parties to that certain Service Agreement, dated February 1, 1992, as amended June 6, 1996, under Seller's Rate Schedule FT (Seller's Contract #1003682, hereinafter COllectively referred to as "the Service Agreement") pursuant to which Seller provides firm transportation service for Buyer up to the dekatherm equivalent of 237,638 Met of natural gas per day (which equates to 245,955 dt per day based on a conversion factor of 1.035 dt per Mcf); and WHEREAS, Seller and Buyer now desire to amend the Service Agreement to include a negotiated facilities surcharge for the costs incurred by Seller to construct the Staten Island Heater Facility and associated valve setting facilities and appurtenances; and WHEREAS, Seller and Buyer also desire to amend the Service Agreement to extend the primary term thereof. NOW THEREFORE, in consideration of the premises and mutual covenants and agreements set forth herein and in the Service Agreement, the receipt and sufficiency of which are hereby acknowledged, Seller and Buyer hereby agree to amend the Service Agreement as follows: 1. Article IV of the Service Agreement is hereby deleted in its entirety and replaced by the following: "ARTICLE IV TERM OF AGREEMENT This agreement shall be effective as of February 1, 1992 and shall remain in force and effect until 9:00 a.m. Central Clock Time June 1, 2016 and thereafter until terminated by Seller or Buyer upon at least three (3) years written notice; provided, however, this agreement shall terminate immediately and, subject to the receipt of necessary authorizations, if any, Seller may discontinue service hereunder if (a) Buyer, in Seller's reasonable judgment fails to demonstrate creditworthiness, and (b) Buyer fails to provide adequate security in accordance with Section 32 of the General Terms and Conditions of Seller's Volume No.1 Tariff. As set forth in Section 8 of Article II of Seller's August 7, 1989 revised Stipulation and Agreement in Docket Nos. RP88-68 et.al., (a) pregranted abandonment under Section 284.221(d) of the Commission's regulations shall not apply to any long term conversions from firm sales service to transportation service under Seller's Rate Schedule FT and (b) Seller shall not exercise its right to terminate this service agreement as it applies to transportation service resulting from conversions from firm sales service so long as Buyer is willing to pay rates no less favorable than Seller is otherwise able to collect from third parties for such service,li
2. The attached Exhibit C is hereby incorporated into and made a part of the Service Agreement. 3. This Amendment shall be effective as of the date first above written. 4. Except as herein amended, the Service Agreement shall remain in full force and effect pursuant to the terms thereof. IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be signed by their respective officers or representative thereunto duly authorized. TRANSCONTINENTAL GAS PIPE LINE COMPANY, LLC By THE BROOKLYN UNION GAS COMPANY D/B/A NATIONAL GRID NY ~ BY ~~~~~~ ~~~ Print Name +-=li1-'~~,,*ffi--- Title --+--I-.AlJIt/)fWi6~-Si ma-!efv-- 2
Exhibit C Specification of Negotiated Rate and Term Staten Island Heater Facility Surcharge. In addition to the rates, charges, surcharges and fuel payable by Buyer to Seller in accordance with Article V of this service agreement, Buyer, subject to the terms of this service agreement and receipt and acceptance of any necessary regulatory approvals by Seller, agrees to pay Seller a negotiated daily reservation rate surcharge ("Surcharge") of $0.02503 per dt for a term of five (5) years commencing on the ready.for service date of the Staten Island Heater Facility and associated valve setting facilities and appurtenances (collectively, the "Project Facilities"). The initial Surcharge stated above is based on the most current estimated cost of the Project Facilities (and corresponding tax reimbursement). Promptly following the date that Transco has determined the final costs of the Project Facilities ("Final Costs"), the Parties shall amend this Exhibit C to set forth a revised Surcharge derived from the unrecovered portion of the Final Costs, the tax reimbursement amount determined based on such unrecovered portion of the Final Costs, the applicable billing determinants, and the carrying cost rate used to determine the initial Surcharge. Thereafter during the five-year term of the Surcharge, such revised Surcharge shall apply. The Surcharge will be billed by Seller and paid by Buyer under this service agreement in accordance with the billing and payment provisions of the General Terms and Conditions of Seller's FERC Gas Tariff.
Transcontinental Gas Pipe Line Company, LLC FERC NGA Gas Tariff Original Volume No. 1A Effective Date: May 20, 2011 Contract No. 1003687 Keyspan Gas East Corporation d/b/a National Grid, Amendment dated 5/19/2011 Option Code: A
SECOND AMENDMENT TO SERVICE AGREEMENT THIS SECOND AMENDMENT TO SERVICE AGREEMENT ("Amendment") is entered into as of <?1,4 y I'I~, '20 II, by and between TRANSCONTINENTAL GAS PIPE LINE COMPANY, LLC (formerly Transcontinental Gas Pipe Line Corporation), a Delaware limited liability company, hereinafter referred to as "Seller," first party, and KEYSPAN GAS EAST CORPORATION D/B/A NATIONAL GRID (formerly Long Island Lighting Company), hereinafter referred to as "Buyer," second party. WiTNESSETH WHEREAS, Seller and Buyer are parties to that certain Service Agreement, dated February 1, 1992, as amended March 10, 2005, under Seller's Rate Schedule FT (Seller's Contract #1003687, hereinafter collectively referred to as "the Service Agreement") pursuant to which Seller provides firm transportation service for Buyer up to the dekatherm equivalent of 149,070 Met of natural gas per day (which equates to 154,287 dt per day based on a conversion factor of 1.035 dt per Met); and WHEREAS, Seller and Buyer now desire to amend the Service Agreement to include a negotiated facilities surcharge for the costs incurred by Seller to construct the Staten Island Heater Facility and associated valve setting facilities and appurtenances; and WHEREAS, Seller and Buyer also desire to amend the Service Agreement to extend the primary term thereof. NOW THEREFORE, in consideration of the premises and mutual covenants and agreements set forth herein and in the Service Agreement, the receipt and sufficiency of which are hereby acknowledged, Seller and Buyer hereby agree to amend the Service Agreement as follows: 1. Article IV of the Service Agreement is hereby deleted in its entirety and replaced by the following: "ARTICLE IV TERM OF AGREEMENT This agreement shall be effective as of February 1, 1992 and shall remain in force and effect until 9:00 a.m. Central Clock Time June 1, 2016 and thereafter until terminated by Seller or Buyer upon at least three (3) years written notice; provided, however, this agreement shall terminate immediately and, subject to the receipt of necessary authorizations, if any, Seller may discontinue service hereunder if (a) Buyer, in Seller's reasonable judgment fails to demonstrate creditworthiness, and (b) Buyer fails to provide adequate security in accordance with Section 32 of the General Terms and Conditions of Seller's Volume No.1 Tariff. As set forth in Section 8 of Article II of Seller's August 7, 1989 revised Stipulation and Agreement in Docket Nos. RP88-68 et.al., (a) pregranted abandonment under Section 284.221(d) of the Commission's regulations shall not apply to any long term conversions from firm sales service to transportation service under Seller's Rate Schedule FT and (b) Seller shall not exercise its right to terminate this service agreement as it applies to transportation service resulting from conversions from firm sales service so long as Buyer is willing to pay rates no less favorable than Seller is otherwise able to collect from third parties for such service. 11
2. The attached Exhibit C is hereby incorporated into and made a part of the Service Agreement. 3. This Amendment shall be effective as of the date first above written. 4. Except as herein amended, the Service Agreement shall remain in full force and effect pursuant to the terms thereof. IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be signed by their respective officers or representative thereunto duly authorized. TRANSCONTINENTAL GAS PIPE LINE COMPANY, LLC KEYSPAN GAS EAST CORPORATION D/B/A NATIONAL GRID By Director, Customer Servic s ~ By --~~~g=-- 'A... Pri nt N a me +--II;r:,;;---,----;-fl-'-'-..,--- \l Title ~I-'''-''':':'':::=.=c=",,- 2
Exhibit C Specification of Negotiated Rate and Term Staten Island Heater Facility Surcharge. In addition to the rates, charges, surcharges and fuel payable by Buyer to Seller in accordance with Article V of this service agreement, Buyer, subject to the terms of this service agreement and receipt and acceptance of any necessary regulatory approvals by Seller, agrees to pay Seller a negotiated daily reservation rate surcharge ("Surcharge") of $0.02704 per dt for a term of five (5) years commencing on the ready for service date of the Staten Island Heater Facility and associated valve setting facilities and appurtenances (collectively, the "Project Facilities"). The initial Surcharge stated above is based on the most current estimated cost of the Project Facilities (and corresponding tax reimbursement). Promptly following the date that Transco has determined the final costs of the Project Facilities ("Final Costs")' the Parties shall amend this Exhibit C to set forth a revised Surcharge derived from the unrecovered portion of the Final Costs, the tax reimbursement amount determined based on such unrecovered portion of the Final Costs, the applicable billing determinants, and the carrying cost rate used to determine the initial Surcharge. Thereafter during the five-year term of the Surcharge, such revised Surcharge shall apply. The Surcharge will be billed by Seller and paid by Buyer under this service agreement in accordance with the billing and payment provisions of the General Terms and Conditions of Seller's FERC Gas Tariff.