October 26 OFO by PG&E

Jeff
I am responding to your question to Ben Campbell regarding the October 26,
OFO. Below is a portion of the explanation I prepared so the Customer
Services folks could respond to others who had questions.

Following is a partial recap of the Plans, Plan versions, and times that
lead to calling the OFO on Monday for the gas day of Tuesday, October 26.
Plan 1 prepared at 06:38 AM on October 25 was used to make the decision to
call for the OFO effective on Tuesday.

The version of the plan printed at 6:38 AM was used to make the OFO decision
but this plan was not posted to the Pipe Ranger. After the OFO decision was
made and announced to the market, the Golden Gate Market Center called to
inform the Sr Transmission Coordinator that non core customers had request
approximately 205 Mdth of total non core withdrawal rights so this request
was included in the planning process even though the gas had not yet been
scheduled. This version of the plan with the tentative (but not scheduled)
non core withdrawal was posted to the Pipe Ranger at approximately 8:08 AM.
The additional withdrawal increased the system inventory to a level above
that which we would call for an OFO. It has been our policy not to recind
OFO announcements once the market has begun to make adjustments and in this
case the additional withdraw had not been nominated or scheduled. If the
OFO had been recinded it is quite possible the the withdrawal may not have
been scheduled.

Our criteria for calling OFOs remains what was outlined in the OFO
Settlement agreement which was met according the Plan produced at 6:38 AM
but not posted to the Pipe Ranger. The later Plan which was posted to Pipe
Ranger incorporated later information and therefore indicated that the OFO
criteria that we are using was not met - hence the confusion.

< To make sure that the market sees the information we use to make OFO
< decisions, we have issued explicit instructions to the Sr. Transmission
< Coordinators to post the plan they use to make the OFO decision.
<
Please call or email if you have additional questions.

<<...<<

Jack Dunlap
223-2039