www.CTGreenGuide.com SprinG 2015 • Connecticut Green Guide 13
this method of allocating capacity is having the unin-
tended consequence of driving up competitive prices due
to the increased costs of scarce capacity. Between the
scarcity of capacity and the cost allocations for capacity
charged by the utilities, the suppliers have informed PURA
that unless changes are made to the program, the com-
petitive suppliers will no longer be able to cost-effectively
supply gas to their customers and take on the risks of the
market. The suppliers' suggested solution is rather than
having an artificial capacity allocation between competi-
tive suppliers and regulated utilities, the capacity should
serve the customer purchasing the gas, regardless of who
that customer purchased the gas from.
The utilities have countered that allowing such a
capacity-follows-the-customer allocation may cause
unreliability in the gas distribution system, since the
utilities will never be truly certain how the capacity
resource will be allocated at any given time.
This matter is currently before PURA, and it is hoped
that PURA will issue a decision before customers need
to be signed up for the next heating season. Only time
will tell if Connecticut's experiment with competitive
natural gas supplies will be allowed to continue, or
whether the capacity constraints that Connecticut faces
will suffocate the competitive suppliers.
Lee D. Hoffman is chairman of Hartford law firm Pullman & Comley's
Regulatory, Energy, & Telecommunications Department.
Power plants that run on natural gas, like the NRG Energy facility
in Middletown, also draw the fuel from the pipeline, limiting the
capacity for home heating.
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