Selective Constraint Days
A Selective Constraint Day applies to only one specific gas transportation customer — not to gas transportation customers as a whole. When a gas transportation customer has a history of using more gas than it delivers to Wisconsin Public Service's system, the utility may declare a Selective Constraint Day for that specific customer.
In order to control costs for all customers, WPS assumes that transportation customers have purchased adequate gas supplies from their marketers or brokers on a daily basis. WPS provides a monthly cashout mechanism for any unavoidable, incidental differences that occur between a transportation customer's nomination and that customer's actual usage.
However, due to price swings in the natural gas spot market, WPS's monthly cashout price for gas may be significantly lower than the price transportation customers would pay their suppliers.
When this happens, some transportation customers may purposely under-nominate the gas supply they are delivering to the utility's system. As a result, these transportation customers use gas that was purchased to serve system sales gas customers. This abuse could force WPS to buy more expensive gas on the spot market and, ultimately, unfairly increase costs for system sales customers. During a Selective Constraint Day, a customer is charged the surcharge for Unauthorized Use of Gas for any usage that exceeds the customer's approved nomination.
Customers may be able to reduce this charge through the use of an intra-day nomination.
Please note that Annual Supply Backup Service is not automatically nominated on a Selective Constraint declaration. The customer (or marketer or broker) must nominate these supplies in advance.
Selective Constraint Days allow WPS to single out customers who consistently under-nominate their gas supplies, without penalizing transportation customers who typically do a good job of nominating their gas supplies.
A Selective Constraint Day can be declared any time of the year if the approved daily nominations for a specific transportation gas customer (or shippers pool) have been either:
- 90% or less of actual usage for any two of the previously completed
seven days
OR
- 1,000 dekatherms less than actual usage for any two of the previously completed seven days
Impacts for Transportation Customers
Notification: Customers are notified at least 2 hours before the gas day begins so they can take actions to control their gas usage within their approved nominations.
Duration: A constraint day lasts for an entire gas day (24 hours). Conditions may require WPS to declare consecutive constraint days.
Restrictions: A customer may use only its approved nomination — the amount of gas ANR Pipeline delivers to WPS's system for that specific customer's use. A customer in a pool should not exceed the volume allocated for that customer by the pool administrator.
Penalty for using too much gas: The surcharge for Unauthorized Use of Gas is applied to each therm of gas burned that exceeds the sum of the customer's approved nomination and any Annual Supply Backup Service. The surcharge is $2 per therm if ANR does not declare a Cease and Desist Order. When ANR declares a Cease and Desist Order, the surcharge is $10 per therm plus any incremental costs.
Charge for using too little gas: Normal daily balancing charges still apply if a customer uses less gas than it delivers to the WPS system.
Optional service: Customers may contract with WPS for Annual Supply Backup Service. This contracted service, which must be nominated in advance, may be used in addition to the approved nomination.
Selective Constraint Days Declared by Wisconsin Public Service
| Dates | # of Days | Customers Affected | Reason |
|---|---|---|---|
| Dec. 12-14, 2000 | 3 | Customers and marketers exceeding tariff limitations | Colder temperatures combined with high spot gas prices. |