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EIGHT MILLION CONSUMERS IN 13 STATES MIGHT PAY HIGHER GAS RATES UNLESS FERC DELAYS IMPLEMENTATION OF ORDER 636 FOR COLUMBIA GAS

 BALTIMORE, March 2 /PRNewswire/ -- Natural gas customers in 13 states and the District of Columbia may be required to pay significantly higher gas rates unless the Federal Energy Regulatory Commission delays the implementation of Order 636 on Columbia Gas Transmission Corporation, a coalition of utilities and municipalities said today.
 According to the coalition, Columbia, which is under Chapter 11 Bankruptcy protection, is attempting to use Order 636 as a means of passing off more than $1 billion in rejected producer contracts as legitimate Order 636 restructuring costs. If the FERC applies Order 636 to Columbia while the bankruptcy is in progress, there is an increased chance that consumers in West Virginia, Virginia, Maryland, New York, Ohio, Pennsylvania, New Jersey, Kentucky, Tennessee, North Carolina, South Carolina, Delaware, Rhode Island and D.C. may end up footing the bill.
 "The bottom line is, unless the FERC changes its approach, 8 million natural gas consumers may end up paying significantly more for their gas service," a spokesperson for the coalition of utilities and municipalities said. "We are urging President Clinton and members of Congress to protect consumers by urging the FERC to delay implementation and allow the Federal Court to work."
 FERC Order 636 essentially takes pipeline companies out of the business of buying and selling gas. The costs of restructuring under the order are to be borne by the pipelines' customers. Included in these costs is an allowance for terminating or restructuring producer contracts. However, Columbia is trying to use Order 636 to pass along bankruptcy charges resulting from contracts it rejected when it went into Chapter 11 bankruptcy in 1991, nine months before Order 636 became effective. These charges are not Order 636 restructuring costs.
 "The application of Order 636 to Columbia at this time is highly inappropriate," the coalition spokesperson said. "It is imperative for the FERC to delay implementation of Order 636 on Columbia until after federal bankruptcy court proceedings have been completed. That way, consumers will only pay for true restructuring costs."
 So far, the FERC has rejected twice the utilities' request to delay implementation. Order 636 calls for all pipelines, including Columbia, to be in compliance by this November.
 "FERC appears to be against anything standing in the way of the complete implementation of Order 636 on all pipelines," the coalition spokesperson said. "Columbia's situation is unique since it is the only pipeline company in bankruptcy. The sensible course of action would be to delay implementation until Columbia takes care of its bankruptcy claims."
 -0- 3/2/93
 /CONTACT: Art Slusark of Baltimore Gas & Electric, 410-234-7433, Roberta Kline of Washington Gas, 202-624-6042, Rick Grant of Mountaineer Gas, 304-347-0543, Gail Kolb of UGI Utilities, 215-796-3506, Steve Brash of Cincinnati Gas & Electric, 513-287-2226, Stan Balis of Charlottesville and Richmond, 202-789-1450, or Dave Kearney of the City of Richmond, Va., 804-780-7952/
 (CG BGE)


CO: Federal Energy Regulatory Commission; Columbia Gas Transmission
 Corporation ST: Maryland IN: UTI SU:


MK -- PH014 -- 2043 03/02/93 14:45 EST
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Publication:PR Newswire
Date:Mar 2, 1993
Words:496
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