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Chapter 4901:1-14 | Uniform Purchased Gas Adjustment Clause

 
 
 
Rule
Rule 4901:1-14-01 | Definitions.
 

For purposes of this chapter:

(A) "Ccf" means a unit of gas equal to one hundred cubic feet.

(B) "Commission" means the public utilities commission of Ohio.

(C) "Commodity rate" means the portion of gas costs billed by a gas or natural gas company's suppliers (expressed in dollars and cents per Mcf, dekatherm, or BTU), which relates volumetrically to the cost of the units of gas obtained by the company for sale to its customers. For purposes of the calculations required under rule 4901:1-14-05 of the Administrative Code, "commodity rate" means the average of the commodity rates expected to be in effect during the period the new gas cost recovery rate will be in effect.

(D) "Customer" means each billing account of a gas or natural gas company.

(E) "Current direct cost of production" means the production and gathering expenses associated with utility production volumes from old wells which are included in accounts 750 through 769 of the "Uniform System of Accounts for Class A and B Gas Utilities," and accounts 710, 711, 713, 714, 715, 716, 717, and 719 of the "Uniform System of Accounts for Class C and D Gas Utilities."

(F) "Demand and service charges" means the portion of gas costs billed by a gas or natural gas company's suppliers or other service providers (expressed in dollars and cents per Mcf, dekatherm, or BTU), which relates to the cost of demand, capacity reservation or use, transportation, storage, balancing, gathering and other related services which are costs to the company of obtaining the gas that it sells prior to and including the physical delivery of the gas to the company's own system to the extent such charges are not included in the "commodity rate" as defined in paragraph (C) of this rule. For purposes of the calculations required under rule 4901:1-14-05 of the Administrative Code, "demand and service charges" mean the average of the demand charges expected to be in effect during the period the new gas cost recovery rate will be in effect.

(G) "Expected gas cost (EGC)" means the weighted average cost of primary gas supplies, utility production from old wells, and includable propane expressed in dollars and cents per Mcf and determined in accordance with the appendix to rule 4901:1-14-05 of the Administrative Code.

(H) "Gas" means any vaporized fuel transported or supplied to consumers by a gas or natural gas company, including, but not limited to, natural gas, synthetic gas, liquefied natural gas, and propane.

(I) "Gas company" and "natural gas company" have the meanings set forth in section 4905.03 of the Revised Code.

(J) "Gas costs" or "cost of gas" means the cost to a gas or natural gas company of obtaining the gas which it sells to its customers. The cost of gas includes demand, capacity reservation or use, transportation, storage, balancing, gathering, and other related costs to the company for services rendered or supplies provided by others prior to and including the physical delivery of the gas to the company. The cost of gas does not include the cost of utility storage otherwise recovered in base rates.

(K) "Gas cost recovery rate (GCR)" means the quarterly update, or other periodic update as approved by the commission, of the gas cost adjustment determined in accordance with the appendix to rule 4901:1-14-05 of the Administrative Code.

(L) "Includable gas supplies" means primary gas supplies, includable propane, and utility production volumes.

(M) "Includable propane" means propane used for peak shaving purposes, and propane used for volumetric purposes at the end of a supply period to avoid monetary penalties.

(N) "Jurisdictional sales" means total historic, forecasted, and/or weather-normalized historic sales, less sales to customers under municipal ordinance rates, except sales under municipal ordinances which have adopted, by reference or otherwise, rates established by the commission.

(O) "Mcf" means a unit of gas equal to one thousand cubic feet.

(P) "New well" is either a well where drilling commenced after December 4, 1982, or an old well which is completed to a different pool after December 4, 1982.

(Q) "Old well" is a well where drilling commenced before December 4, 1982.

(R) "Pool" has the meaning set forth in paragraph (A)(39) of rule 1501:9-1-01 of the Administrative Code.

(S) "Primary gas supplies" means historic, forecasted, and/or weather-normalized historic:

(1) Supplies of natural gas or liquefied natural gas obtained from producers, interstate pipelines, brokers/marketers, or other suppliers;

(2) Supplies of synthetic gas purchased under agreements approved by the commission under section 4905.303 of the Revised Code, and other supplies of synthetic gas, except short-term supplies, purchased under contracts approved by the commission;

(3) Supplies of gas obtained from other gas or natural gas companies;

(4) Supplies of gas, other than utility production volumes from old wells, obtained from Ohio producers;

(5) Supplies of gas made available to a gas or natural gas company under self-help arrangements;

(6) Special purchases of natural gas not included in short-term supplies; and

(7) Utility production volumes from new wells provided that such volumes are priced no higher than the price currently being paid by the utility to independent Ohio producers for gas from like wells.

(T) "Production unit cost" means the current direct cost of production expressed in dollars and cents per Mcf.

(U) "Purchased gas adjustment clause" has the meaning set forth in section 4905.302 of the Revised Code.

(V) "Reconciliation adjustment" means a positive or negative adjustment to future gas cost recovery rates ordered by the commission pursuant to this chapter.

(W) "Supplier refund" means a refund from an interstate pipeline company ordered by the federal energy regulatory commission, or from any other supplier or service provider, including interest where appropriate, where such refund is received as one lump-sum payment or credit.

(X) "Self-help arrangement" means an arrangement between a gas or natural gas company and a customer providing for the transportation of gas owned by the customer from the point of production to the point of consumption.

(Y) "Short-term supplies" means all special purchases of gas, to the extent that those purchases decrease the level of curtailment to any customer or class of customers, except special purchases approved by the commission under section 4905.303 of the Revised Code. For purposes of this chapter, a special purchase decreases curtailment to a class of customers if curtailment of that class is reduced, maintained at the same level, or increased to a lesser degree as a result of the special purchase.

(Z) "Special purchase" has the meaning set forth in section 4905.302 of the Revised Code.

(AA) "Synthetic gas" means gas formed from feedstocks other than natural gas, including, but not limited to, coal, oil, or naphtha.

(BB) "Total sales" means all historic, forecasted, and/or weather-normalized historic sales of includable gas supplies to retail customers. "Total sales" does not include volumes transported to consumers under self-help arrangements. For purposes of recovery of the balance adjustment, actual adjustment, and reconciliation adjustment, "total sales" does not include sales to customers for which the reverse migration rider applies.

(CC) "Unaccounted-for gas" means the difference between the measured volume of total gas supply, which includes gas purchased, gas produced by the company, and gas received by the company on behalf of specific customers for redelivery; and the measured volume of gas disposition, which includes gas billed or redelivered to customers and gas for company use. For the purpose of this rule, unaccounted-for gas should be calculated on an annual basis for the twelve months ended August thirty-first of each year, or such other date as the company may show to be more appropriate for its system. The percentage of unaccounted-for gas should be calculated by taking the volumes of unaccounted-for gas as specified above, divided by the volume of total gas supply.

(DD) "Unit book cost" means the cost of total sales expressed in dollars and cents per Mcf as calculated using standard accounting methods acceptable to the commission and the gas or natural gas company's independent auditors.

(EE) "Utility production volumes" means all volumes of gas, other than synthetic gas, produced by a gas or natural gas company, or by a subsidiary or affiliate of a gas or natural gas company, unless the rates or charges for such production are subject to the jurisdiction of the federal energy regulatory commission.

(FF) "Utility storage" means storage facilities operated and maintained by a gas or natural gas company, or by a subsidiary or affiliate of a gas or natural gas company, unless the charges for such facilities are incorporated in commodity rates or monthly demand charges filed with or approved by the federal energy regulatory commission or by the commission, provided, however, that no gas or natural gas company reflects charges for its own storing facilities or service in its own gas cost recovery rate.

Last updated October 15, 2024 at 11:20 AM

Supplemental Information

Authorized By: 4905.302
Amplifies: 4905.302
Five Year Review Date: 9/30/2029
Prior Effective Dates: 1/1/1980, 5/15/1984, 10/7/2005, 4/17/2014
Rule 4901:1-14-02 | Purpose and scope.
 

(A) The purpose of this chapter is to establish a uniform purchased gas adjustment clause to be included in the schedules of gas and natural gas companies subject to the jurisdiction of the commission. The provisions of this chapter establish a gas cost recovery process, which is designed to separate the cost of gas from all other costs incurred by gas or natural gas companies, to provide for each company's recovery of the cost of its includable gas supplies from its customers by means of the quarterly update (or other periodic update as approved by the commission) of the gas cost recovery rate and other provisions of this chapter and to balance the interest of retail sales customers with those of transportation customers. The provisions of this chapter also establish investigative procedures and proceedings, including periodic reports, audits, and hearings, to examine the arithmetic and accounting accuracy of the gas costs reflected in each company's gas cost recovery rate, and to review each company's gas production and purchasing policies to the extent that those policies affect the gas cost recovery rate.

(B) The commission may, upon an application or a motion filed by a party, waive any requirement of this chapter, other than a requirement mandated by statute, for good cause shown.

(C) The rules of this chapter supersede any inconsistent provisions, terms, and conditions of the gas or natural gas company's tariffs.

Last updated October 7, 2024 at 12:58 PM

Supplemental Information

Authorized By: 4905.04, 4905.05, 4905.06
Amplifies: 4905.302, 4905.303
Five Year Review Date: 9/30/2029
Prior Effective Dates: 10/21/1978
Rule 4901:1-14-03 | Applicability.
 

The provisions of this chapter apply to all gas and natural gas companies subject to the jurisdiction of the commission except as provided in divisions (C)(4) and (D) of section 4905.302 of the Revised Code, with respect to all schedules of rates established or approved by the commission, including, but not limited to, rate schedules approved or established under sections 4905.31, 4909.19, and 4909.39 of the Revised Code. The provisions of this chapter do not apply to municipal ordinance rates established under section 743.26 or 4909.34 of the Revised Code or Article XVIII, Section 4 of the Ohio Constitution, except in instances where a municipal ordinance adopts, by reference or otherwise, rates established by the commission.

Last updated October 7, 2024 at 12:58 PM

Supplemental Information

Authorized By: 4905.04, 4905.05, and 4905.06
Amplifies: 4905.302 and 4905.303
Five Year Review Date: 9/30/2029
Prior Effective Dates: 10/21/1978, 10/11/1991
Rule 4901:1-14-04 | Reports.
 

Each gas or natural gas company subject to the provisions of this chapter shall file with the commission's docketing division quarterly gas cost recovery reports. With commission approval, the gas or natural gas company may revise the expected gas cost component of the gas cost recovery report on a monthly basis. Unless otherwise determined by the commission, the expected gas cost component may be revised, as market conditions warrant, and filed with the commission's docketing division no later than fourteen days prior to the effective date of the gas cost recovery rate. Each gas cost recovery report shall contain:

(A) An updated gas cost recovery rate, determined in accordance with rule 4901:1-14-05 of the Administrative Code and its appendix;

(B) The data and calculations used to determine the updated gas cost recovery rate;

(C) Where appropriate, notations indicating the use of weather-normalized or forecasted sales volumes in the gas cost recovery report and/or updates; and

(D) The frequency of revisions to the expected gas cost component, the effective dates, and the dates such revisions will be filed with the commission.

Last updated October 7, 2024 at 12:59 PM

Supplemental Information

Authorized By: 4905.04, 4905.05, and 4905.06
Amplifies: 4905.302 and 4905.303
Five Year Review Date: 9/30/2029
Prior Effective Dates: 4/17/2014
Rule 4901:1-14-05 | Gas cost recovery rate.
 

(A) The gas cost recovery rate equals:

(1) The gas or natural gas company's expected gas cost for the upcoming quarter, or other period as approved by the commission, pursuant to paragraph (K) of rule 4901:1-14-01 of the Administrative Code, plus or minus;

(2) The supplier refund and reconciliation adjustment, which reflects:

(a) Refunds received from the gas or natural gas company's interstate pipeline suppliers or other suppliers or service providers plus ten per cent annual interest; and

(b) Adjustments ordered by the commission following hearings held pursuant to rule 4901:1-14-08 of the Administrative Code, plus ten per cent annual interest, plus or minus;

(3) The actual adjustment, which compensates for differences between the previous quarter's, or other commission-approved period's, expected gas cost and the actual cost of gas during that period, plus or minus; and

(4) The balance adjustment, which compensates for any under- or overcollections which have occurred as a result of prior adjustments, plus or minus.

(B) The gas cost recovery rate shall be calculated on a companywide basis, except as provided in paragraph (C) of this rule, in accordance with the appendix to this rule.

(C) The commission may, upon the request of any party or upon its own initiative, permit the company to calculate different gas cost recovery rates for different geographical areas. In determining whether to do so, the commission may consider:

(1) Whether the geographical areas involved are contiguous;

(2) Whether the cost of obtaining gas for each of the geographical areas involved can be separately identified;

(3) The manner in which the geographical areas involved have been treated in the past; and

(4) Such other factors as the commission considers appropriate.

View Appendix

Last updated October 7, 2024 at 12:59 PM

Supplemental Information

Authorized By: 4905.302
Amplifies: 4905.302
Five Year Review Date: 9/30/2029
Prior Effective Dates: 7/2/1980, 7/24/1982, 10/11/1991
Rule 4901:1-14-06 | Customer billing.
 

(A) Unless otherwise ordered by the commission, the quarterly updated gas cost recovery rate filed in accordance with rule 4901:1-14-04 of the Administrative Code is effective on or after the thirtieth day following the filing date or as otherwise established by the commission. Revisions made to the expected gas cost component pursuant to rule 4901:1-14-04 of the Administrative Code do not affect the effective date of the gas cost recovery rate. The new gas cost recovery rates may be applied to customer accounts on a service-rendered or bills-rendered basis, at the option of the gas or natural gas company. The commission may at any time order a reconciliation adjustment as a result of errors or erroneous reporting.

(B) Except as provided in paragraph (C) of this rule, if the gas cost recovery rate changes during a customer's billing cycle and the gas or natural gas company elects to bill on a service-rendered basis, the gas or natural gas company shall apply a weighted average gas cost recovery (WGCR) rate to its customer bills. The WGCR rate shall be determined in accordance with the following:

(1) GCR1 equals the gas cost recovery rate in effect during the first part of the billing cycle.

(2) GCR2 equals the gas cost recovery rate in effect during the latter part of the billing cycle.

(3) V34 equals a variable representing the total number of days in the billing cycle.

(4) V34.1 equals a variable representing the total number of days in the billing cycle when GCR1 was in effect.

(5) V34.2 equals a variable representing the total number of days in the billing cycle when GCR2 was in effect.

(6) WGCR = [GCR1 x (V34.1 V34)] + [GCR2 x (V34.2 V34)].

(C) If the gas cost recovery rate changes during a customer's billing cycle, and the gas or natural gas company elects to bill on a service-rendered basis, and if the customer's actual daily consumption is known by the gas or natural gas company, the company may, instead of applying a weighted average gas cost recovery rate, apply each gas cost recovery rate which was effective during the billing cycle to the volumes actually consumed when that rate was in effect.

(D) Each gas or natural gas company shall indicate on each customer bill:

(1) The gas cost recovery rate expressed in dollars and cents per Mcf or Ccf; and

(2) The total charge attributable to the gas cost recovery rate expressed in dollars and cents.

Last updated October 7, 2024 at 12:59 PM

Supplemental Information

Authorized By: 4905.04, 4905.05, 4905.06
Amplifies: 4905.302 and 4905.303
Five Year Review Date: 9/30/2029
Prior Effective Dates: 1/1/1980
Rule 4901:1-14-07 | Audits.
 

(A) The commission shall conduct, or cause to be conducted, periodic financial or management/performance audits of each gas or natural gas company subject to the provisions of this chapter and division (C)(4) of section 4905.302 of the Revised Code. Except as provided in paragraph (B) of this rule and division (C) of section 4905.302 of the Revised Code, and unless otherwise ordered by the commission, each audit shall be conducted by a qualified independent auditing firm.

(B) The commission may, upon the request of any party or upon its own initiative, conduct the audits required under this rule. In determining whether to do so, the commission may consider:

(1) The number of customers served by the company;

(2) The cost of employing an independent auditor;

(3) The availability of the commission staff to conduct the required audits; and

(4) Such other factors as the commission considers appropriate.

Last updated October 15, 2024 at 11:20 AM

Supplemental Information

Authorized By: 4905.04, 4905.05, 4905.06
Amplifies: 4905.302, 4905.303
Five Year Review Date: 9/30/2029
Prior Effective Dates: 4/4/2009
Rule 4901:1-14-08 | Hearings.
 

(A) At least sixty days after the filing of each audit report required under rule 4901:1-14-07 of the Administrative Code, the commission shall hold a public hearing to review:

(1) The audit findings, conclusions, and recommendations; and

(2) Such other matters relating to the gas or natural gas company's gas cost recovery rates as the commission considers appropriate.

(B) The gas or natural gas company shall demonstrate at its purchased gas adjustment hearing that its gas cost recovery rates were fair, just, and reasonable and that its gas purchasing practices and policies promote minimum prices consistent with an adequate supply of gas. The commission may consider, to the extent applicable:

(1) The results of the management/performance audit;

(2) The results of the financial audit;

(3) Compliance by the gas or natural gas company with previous commission performance recommendations;

(4) The efficiency of the gas or natural gas company's gas production policies and practices; and

(5) Such other practices, policies, or factors as the commission considers appropriate.

(C) The gas or natural gas company shall publish notice of the hearing required under paragraph (A) of this rule throughout its service area at least fifteen and not more than thirty days prior to the scheduled date of hearing by:

(1) Display ad in a newspaper or newspapers of general circulation;

(2) Bill message on or bill insert included with the customer bills; or

(3) Separate direct mailing to customers.

(D) Following the conclusion of the hearing, the commission shall issue an appropriate order containing:

(1) A summary of the audit findings, conclusions, and recommendations; and

(2) Such other information or directives as the commission considers appropriate.

(E) The commission may adjust the company's future gas cost recovery rates by means of a reconciliation adjustment as a result of:

(1) Errors or erroneous reporting;

(2) Unreasonable or imprudent gas production or purchasing policies or practices;

(3) Unaccounted-for gas above a reasonable level. Unaccounted-for gas above five per cent, calculated pursuant to paragraph (CC) of rule 4901:1-14-01 of the Administrative Code, is presumed to be unreasonable, and it is the company's burden to prove otherwise; or

(4) Such other factors, policies, or practices as the commission considers appropriate.

Last updated October 7, 2024 at 1:04 PM

Supplemental Information

Authorized By: 4905.302
Amplifies: 4905.302
Five Year Review Date: 9/30/2029
Prior Effective Dates: 10/21/1978, 11/14/1985, 8/29/2004, 6/7/2019
Rule 4901:1-14-09 | Tariffs.
 

Each gas or natural gas company subject to the provisions of this chapter shall file tariffs with the commission which incorporate this chapter in its entirety.

Last updated October 7, 2024 at 1:04 PM

Supplemental Information

Authorized By:
Amplifies:
Five Year Review Date: