Reservation of Capacity for the Core Customers

Under PG&E's open season process PG&E is withholding a total of 1305 Mdth/d⁶ of capacity, 100 Mdth more than the current holdings under the current Gas Accord I, from the open season. The Commission is concerned, however, that if PG&E awards capacity on 15-year terms, there may not be sufficient withholding to meet the needs of core customers. Assuming an average rate of growth for core customers of 2% per year; even applying simple escalation, without any compounding, to a 15-year term, core demand will increase 30%. PG&E might need to withhold at least an amount equal to 30% of the core holdings under the Gas Accord, or at least an additional 360 Mdth/d.

Parties did not focus on the amount PG&E was withholding for the core customers, but instead objected to the lack of data, and time to review the data, to determine if the current holdings under the Gas Accord are sufficient, too low, or even perhaps too high. Before the Commission can make an assessment as to the future growth of the core customers, the Commission and the other interested stakeholders need to know if 105Mdth/d is reasonable.