S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________

                                         2060

                              2009-2010 Regular Sessions

                                 I N  A S S E M B L Y

                                   January 15, 2009
                                      ___________

       Introduced  by M. of A. PARMENT -- read once and referred to the Commit-
         tee on Energy

       AN ACT to amend the public service law, in relation to the purchase  and
         procurement of natural gas at lowest available price at the city gate

         THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
       BLY, DO ENACT AS FOLLOWS:

    1    Section 1. Section 66-f of the public service law, as added by chapter
    2  519 of the laws of 1984, is amended to read as follows:
    3    S 66-f. Purchase and procurement of natural gas  at  lowest  available
    4  price  AT  THE  CITY GATE. 1. The commission shall have the authority to
    5  direct any gas corporation subject to the jurisdiction of the commission
    6  to purchase or procure natural gas at the lowest available price AT  THE
    7  CITY GATE as determined by the commission.
    8    2. A gas corporation shall be required to purchase supplies of natural
    9  gas whenever:
   10    (A)  a natural gas producer provides the gas corporation with at least
   11  six months prior notice of the availability of such gas, and
   12    (B) the delivered cost of such gas AT THE CITY GATE  is  equal  to  or
   13  less  than  the  highest  delivered cost of natural gas AT THE CITY GATE
   14  produced outside the state which the  gas  corporation  would  otherwise
   15  purchase  or  acquire[,  adjusted to reflect substantive differences, if
   16  any, in the terms and conditions applicable to the sale of such gas over
   17  the period of availability of the natural gas]; provided, however,  that
   18  no  gas  corporation  shall  be  required  to  purchase natural gas FROM
   19  INSTATE OR OUT-OF-STATE SOURCES, where it can  [demonstrate]  BE  DEMON-
   20  STRATED  THAT  such purchase would have an adverse impact upon its rate-
   21  payers, which cannot be reasonably mitigated.
   22    3. (A) A gas corporation shall respond to a notice of availability  of
   23  supplies  of  natural gas at a specified delivered cost AT THE CITY GATE
   24  provided by a producer of such gas within one month of  the  receipt  of

        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD04732-01-9
       A. 2060                             2

    1  such  notice,  and,  if  it  indicates  its  intent not to purchase such
    2  supplies, shall provide in detail its reasons therefor.
    3    (B)  A  natural gas producer may petition the [public service] commis-
    4  sion, within  fifteen  days  of  the  receipt  of  a  gas  corporation's
    5  response,  to  order such gas corporation to comply with subdivision one
    6  of this section. Such petition shall contain sufficient  information  to
    7  demonstrate  the petitioner's ability to provide the supplies of natural
    8  gas offered for sale to the gas corporation.   A copy of  such  petition
    9  shall also be served upon such gas corporation.
   10    (C)  Within  twenty-one  days of the receipt of such a petition, a gas
   11  corporation shall file such information as is necessary  to  demonstrate
   12  [that] WHETHER AND HOW the purchase  of natural gas during the period of
   13  availability  at  the  specified  delivered cost of such gas AT THE CITY
   14  GATE would have A BENEFICIAL OR an adverse impact upon  its  ratepayers,
   15  AS  COMPARED  TO  THE  HIGHEST DELIVERED COST OF GAS AT THE CITY GATE OF
   16  OTHER AVAILABLE  SOURCES  WHICH  THE  GAS  CORPORATION  WOULD  OTHERWISE
   17  PURCHASE  OR ACQUIRE.  The petitioner and others shall have the opportu-
   18  nity to comment upon the filing by the gas corporation within twenty-one
   19  days of such filing.
   20    (D) The commission shall take final action on any such petition within
   21  [forty] NINETY days after the date upon which the petitioner's  comments
   22  are due.
   23    (E)  The commission may require a gas corporation to purchase all or a
   24  portion of the supplies of natural gas offered by the petitioner  during
   25  the  period  of availability at the specified delivered cost AT THE CITY
   26  GATE, or at such other [cost] LOWEST AVAILABLE PRICE as will not  result
   27  in an adverse impact upon such gas corporation's ratepayers.
   28    (F) Nothing in this section shall require a producer of natural gas to
   29  sell  such  gas to a gas corporation at a cost other than that specified
   30  in its notice of availability.
   31    4. (A) FOR THE PURPOSES OF THIS SECTION, "CITY GATE"  SHALL  MEAN  THE
   32  POINT  OR  MEASURING  STATION WITHIN THE BOUNDARIES OF NEW YORK STATE AT
   33  WHICH A DISTRIBUTING GAS UTILITY RECEIVES GAS FROM A NATURAL  GAS  PIPE-
   34  LINE COMPANY.
   35    (B)  FOR  THE PURPOSES OF THIS SECTION, "DELIVERED COST" SHALL INCLUDE
   36  PIPELINE DEMAND CHARGES (CAPACITY CREDIT) INCURRED TO TRANSPORT  GAS  TO
   37  THE CITY GATE.
   38    S 2. This act shall take effect immediately.