TRANSWESTERN PIPELINE COMPANY, LLC 2014 RATE CASE UPDATE / OVERVIEW - - PowerPoint PPT Presentation

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TRANSWESTERN PIPELINE COMPANY, LLC 2014 RATE CASE UPDATE / OVERVIEW - - PowerPoint PPT Presentation

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TRANSWESTERN PIPELINE COMPANY, LLC 2014 RATE CASE UPDATE / OVERVIEW Phoenix, AZ | September 16, 2014 AGENDA Introductions Past Settlements 2014 Rate Case Filing Gas Plant, Cost of Service, & Tariff Rates Tariff Changes

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SLIDE 1

TRANSWESTERN PIPELINE COMPANY, LLC

2014 RATE CASE UPDATE / OVERVIEW

Phoenix, AZ | September 16, 2014

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SLIDE 2

AGENDA

  • Introductions
  • Past Settlements
  • 2014 Rate Case Filing
  • Gas Plant, Cost of Service, & Tariff Rates
  • Tariff Changes

– Rate Schedules – General Terms and Conditions

  • Discussion Points
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SLIDE 3

PAST SETTLEMENTS

  • RP06-614
  • Last Filed Rate Proceeding
  • $193.5M Settlement (Cost of Service)
  • RP11-2576
  • “Pre-Settlement” Filing
  • No Change in Transportation Rates
  • Fuel Reductions
  • Requirement to File a Rate Proceeding on October 1, 2014
  • Fuel Tracker
  • Reservation Charge Crediting
  • Roll-In of Phoenix Expansion
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SLIDE 4

2014 RATE CASE FILING

  • Key Dates
  • File on October 1, 2014 – Per Settlement in RP11-2576-000
  • Anticipate Suspension to April 1, 2015
  • Base Period: June 2013 – May 2014
  • Adjustment Period: June 2014 – February 2015
  • Anticipated FERC Process
  • FERC Order Suspending Rates
  • Administrative Conference
  • Rolling Discovery
  • FERC Staff Top Sheets
  • Settlement or Hearing
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SLIDE 5

BASIS OF RATE CASE FILING

  • Cost of Service
  • Allocation of General / Common Costs Based on Plant,

O&M, Miles of Pipe, and Usage Units

  • Maintain Existing Depreciation Rates
  • Roll-In of Phoenix Expansion and New River

Compression Expansion in Rates

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SLIDE 6

BASIS OF RATE CASE FILING

(CONTINUED)

  • Rate Design
  • Utilizes Adjusted Straight Fixed Variable Cost

Allocation/Rate Design – 5% of Return and Taxes Allocated to Usage Rate

  • Continue West of Thoreau / East of Thoreau / San

Juan / Phoenix Rate Derivation / Boundaries

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SLIDE 7

GAS PLANT

RP06-614-000 RP15-XX-000 As Filed As Filed

$ 1,156.2 $ 2,322.7 Total Gas Plant ($MM):

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SLIDE 8

COST OF SERVICE

Total Operating Expenses $ 58.3 $ 53.3 Depreciation Expense 19.4 32.0 Taxes Other Than Income 12.3 18.2 Return 81.6 178.0 Federal / State Income Taxes 39.3 58.3 Revenue Credits (0.1) 0.0 Total $ 210.8 $ 339.8 Settlement

$ 193.5

RP06-614-000 RP15-XX-000 As Filed ($MM) As Filed ($MM)

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SLIDE 9

RATE COMPARISON

West of Thoreau (California) Reservation - Daily 22.59 ¢ 62.53 ¢ Usage 0.89 ¢ 2.52 ¢ 100% LF 23.48 ¢ 65.05 ¢ West of Thoreau (East of California) Reservation - Daily 19.09 ¢ 52.84 ¢ Usage 0.89 ¢ 2.52 ¢ 100% LF 19.98 ¢ 55.36 ¢ San Juan Reservation - Daily 14.00 ¢ 30.44 ¢ Usage 0.22 ¢ 0.96 ¢ 100% LF 14.22 ¢ 31.40 ¢ East of Thoreau Reservation - Daily 15.00 ¢ 31.11 ¢ Usage 1.18 ¢ 2.16 ¢ 100% LF 16.18 ¢ 33.27 ¢ Phoenix Reservation - Daily 69.73 ¢ 90.85 ¢ Usage 0.00 ¢ 6.76 ¢ 100% LF 69.73 ¢ 97.61 ¢

Current RP15-XX-000 Rate Area Rates As Filed

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SLIDE 10

FTS-1, FTS-4, & LFT Reservation 36.59 ¢ 92.97 ¢ Usage 1.11 ¢ 3.48 ¢ 100% LF 37.70 ¢ 96.45 ¢ FTS-2 Usage 23.82 ¢ 46.81 ¢ FTS-3 Reservation N/A 139.46 ¢ Usage N/A 3.48 ¢ 100% LF N/A 142.94 ¢ FTS-5 (San Juan to Phoenix Path) Reservation 102.82 ¢ 174.13 ¢ Usage 1.11 ¢ 10.24 ¢ 100% LF 103.93 ¢ 184.37 ¢

Firm Current RP15-XX-000 Rate Schedules Rates As Filed

RATE COMPARISON

(SAN JUAN TO CALIFORNIA PATH)

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SLIDE 11

RATE COMPARISON

PNR Usage 39.66 ¢ 98.32 ¢ ITS-1 Usage 37.70 ¢ 96.45 ¢ ITS-2 (San Juan to Phoenix Path) Usage 103.93 ¢ 184.37 ¢ HPS Usage N/A 97.61 ¢

Interruptible Current RP15-XX-000 Rate Schedules Rates As Filed

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SLIDE 12

RATE COMPARISON

SJ – CAL 37.70 ¢ 96.45 ¢ SJ – Phoenix 103.93 ¢ 184.37 ¢ EOT – CAL 39.66 ¢ 98.32 ¢ EOT – Phoenix 105.89 ¢ 186.24 ¢ SJ – EOT 30.40 ¢ 64.67 ¢ EOT – EOT 16.18 ¢ 33.27 ¢

Transportation Rates

Current RP15-XX-000 (100% LF) Rates As Filed

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SLIDE 13

TARIFF CHANGES

  • Existing Rate Schedules
  • Uniform Hourly Flow Clarification in Rate Schedules FTS-1, FTS-2,

FTS-4, LFT and ITS -1

  • FTS-1 Delivery Available Down the Phoenix Lateral
  • FTS-1 Usage Charge and Fuel Not Applicable for Deliveries to a

Logical Point within a Specific Pooling Area

  • Eliminate FTS-4 Rate Schedule Effective May 1, 2015
  • FTS-5 Modifications
  • New Firm FTS-3 Service
  • Provides 150% Hourly Rights of Shippers Scheduled Quantities
  • New Hourly Peaking Service (HPS)
  • Interruptible Service is offered to Delivery Point Operators
  • Hourly Swing Capabilities, subject to Available Capacity
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SLIDE 14

TARIFF CHANGES (CONTINUED)

  • General Terms and Conditions
  • Add Reservation Charge Crediting Provisions per

Settlement and Update Scheduling Priorities

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SLIDE 15

TARIFF CHANGES (CONTINUED)

  • Reservation Charge Crediting
  • Tariff Months Eliminated
  • Non-Force Majeure
  • Seven Day Average
  • Force Majeure
  • Ten Day Grace Period
  • Seven Day Average
  • Credits Based on Primary Firm Physical Receipts /

Deliveries

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SLIDE 16

Scheduling Priorities

TARIFF CHANGES (CONTINUED)

Current Proposed

  • 1. Primary and Alternate paths

at a location within the primary path on a pro rata basis

  • 2. Alternate paths at a

location outside the primary path on a pro rata basis

  • 3. Interruptible and Overrun

gas by price

  • 1. Physical Primary receipt to Primary delivery on a pro rata basis
  • 2. Primary receipt (logical pool) to Primary delivery on a pro rata

basis

  • 3. Inside the Primary path from Alternate receipts to Primary

deliveries by price

  • 4. Inside the Primary path from physical Primary receipts to

Alternate deliveries by price

  • 5. Inside the Primary path from logical Primary receipts to

Alternate deliveries by price

  • 6. Inside the Primary path from Alternate receipts to Alternate

deliveries by price

  • 7. Outside the Primary path from Alternate receipts to Primary

deliveries by price

  • 8. Outside the Primary path from physical Primary receipts to

Alternate deliveries by price

  • 9. Outside the Primary path from logical Primary receipts to

Alternate deliveries by price

  • 10. Outside the Primary path from Alternate receipts to Alternate

deliveries by price

  • 11. Interruptible and Overrun gas by price
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SLIDE 17

TARIFF CHANGES (CONTINUED)

  • General Terms and Conditions
  • Add Fuel Tracker and Balancing Reconciliation Provisions

per Settlement

  • File Fixed Fuel Rates in the Alternative to Fuel Tracker
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SLIDE 18

GENERAL TERMS & CONDITIONS

  • Fuel Tracker
  • Filed biannually effective each April 1st and November 1st
  • Two Components
  • Fuel Reimbursement Percentage
  • Fuel Reimbursement Surcharge
  • Collects Fuel Used, LAUF, Electric Costs & Company Use Fuel
  • Balancing Tools Flow Through
  • Annual Cash Out for the Twelve Months ended September 30th
  • Balancing Tools Included:
  • Operational Purchases/Sales
  • OBA Imbalance Resolutions
  • Unauthorized Gas
  • Penalty Amounts
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SLIDE 19

TARIFF CHANGES (CONTINUED)

  • Alert Day Changes
  • Low Line Pack now Overage Alert Day
  • High Line Pack now Underage Alert Day
  • Next Day Alert Days Called Prior to the Beginning of the

Upcoming Gas Day

  • Same Day Alert Days Effective Immediately
  • Alert Day Penalty Charges Updated to Reflect Market Conditions
  • Line Pack No Longer Posted
  • Enhanced OFO Provisions
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SLIDE 20

TARIFF CHANGES (CONTINUED)

  • Other Minor Tariff Changes
  • Gas Quality
  • Measurement
  • Creditworthiness
  • Contracting
  • Unauthorized Gas
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SLIDE 21

QUESTIONS & DISCUSSION

Thank you for your time.

Contact Information:

Gregg E. Russell (713) 989-2510 Gregg.Russell@energytransfer.com Michael T. Langston (713) 989-7610 Michael.Langston@energytransfer.com