Gillis Hub Pipeline, LLC Submits Tariff Record with Negotiated Rate Schedule for Interruptible Wheeling Service

Strategic Insights -

Gillis Hub Pipeline, LLC has submitted a tariff record to the Federal Energy Regulatory Commission (FERC) for the proposed rate schedule IW, which will provide interruptible wheeling service to 17 shippers. The tariff record includes the negotiated rate agreements between GHP and the shippers, which will be effective as of July 1, 2025. GHP is requesting a waiver of the 30-day prior notice requirement to permit the requested effective date.

Key Takeaways:

  • GHP is submitting a tariff record with the proposed provisions discussed in the letter, including a clean tariff record and a marked tariff record reflecting changes to existing tariff records.
  • The proposed tariff record includes the negotiated rate agreements between GHP and 17 shippers, including ExxonMobil Oil Corporation, BP Energy Company, and Castleton Commodities.
  • GHP is proposing an effective date of July 1, 2025, for the tariff record and is requesting a waiver of the 30-day prior notice requirement to permit the requested effective date.
  • The negotiated rate agreements include the provision of interruptible wheeling service, which is expected to be without the need to consume fuel for compression.
  • GHP will bear the burden of demonstrating in future retainage filings that its negotiated retainage rates do not shift to its recourse rate shippers any unrecovered costs.
  • The Commission's Policy Statement on Alternatives to Traditional Cost-of-Service Ratemaking for Natural Gas Pipelines permits GHP to enter into a negotiated rate with its shippers for service under any rate schedule contained in its Tariff.
  • The tariff record submitted in this filing contains the essential terms of an agreement for interruptible wheeling ("IW") service provided under GHP's Rate Schedule IW.
  • The tariff record on file is GHP's baseline tariff, which was accepted by the Commission in Docket No. RP25-240-000.

Statistics:

  • 17 shippers are participating in the negotiated rate agreements, including ExxonMobil Oil Corporation, BP Energy Company, and Castleton Commodities.
  • GHP is proposing an effective date of July 1, 2025, for the tariff record.
  • The Commission's Policy Statement on Alternatives to Traditional Cost-of-Service Ratemaking for Natural Gas Pipelines permits GHP to enter into a negotiated rate with its shippers for service under any rate schedule contained in its Tariff.
  • GHP's baseline tariff was accepted by the Commission in Docket No. RP25-240-000.

Sources:

1. 15 U.S.C. § 717 et seq. (2018)

2. 18 C.F.R. Part 154 (2020)

3. 74 FERC P 61,076, order denying reh'g and clarification, 75 FERC P 61,024 (1996)

4. 98 FERC P 61,206 (2002)

5. 105 FERC P 61,299 at P 14 (2003)

6. 128 FERC P 61,224 at P 62 (2009)

7. 18 C.F.R. § 154.7(a)(9)