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Home My WebLink About0238.094i ·,·~~~~:2;i:~~;X~;'~'> ._\~ ~~ , t < !. ~. ~ • ~ • ~ ,. t ~ , " ::; " " lI,l@ft:, j ~.-:~::"-,,,.;~>.~ , . ,.;'C-;'<.<" ,_ "~-~'~< .' ;(:;;:{:!~ r- ···.·.::i~~i.{",;~"~:.:_C~,,;\;=~~;,.A="~"~'''''',.;.;~~.-:-,, '\ \ ~" ~1) 3UOii'U 94-95 : ,Ita . ,. ·('·'~1IJ01 t __ . _______ -, April 28, 1994 TH8 HONORAB~E CITY COUNCIL PGlo Alto, Califoruia Attention: Finance Committee rropos&~etion of a Na~~ansportation~Only~~~ I!M.s! Members of the Council: This report recommends Council adoption of the attached resolution which establishes a new Gas Rate Schedule 0-3 appl icable to gas transportation-only service. In addition, st.aff l'ecommends Council approval of a standard contl'act which addresses t.he respollsibilities of the Palo Alto Gas Utility and the transportation-only customer. Under the staff proposal, Beven large non-residential customers could qualify to elect transportation"only gas service. The cost and revenue impact of this proposal is not expected to be significant on the Utility or its ratepayet"s. Over the past decade I the gas industry has undergone fundamental regulatory changes which have introduced competition into an environment traditionally viewed as a rr.onopoly. In order to offer gas rates and servic,~s in Palo Alto comparable with those available in surrounding areas and across the countrYI staff proposes to unbundle its gas rates and introduce Gas Rate Schedule 0-3. Rate Schedule G-3 will allow non-core C'ustomers to put"chase their gas from a competing supplier in conjunction with transportation-only CMR:23B:94 .';,>~, . "".; + .. ··;;.'i;: I ,: "., ~"~~,," ' . -, .. ~ ". .-- . ·;m-,,:;,~~J&~~1.;'I,~~. \ . service from the Palo Alto Gas Utility, or to continue to purchase the gas and transportation from the City. The City's competitors are gas prOOuc'era and marketers in Canada and the United States. Non-core' customers are defined as large non-reaidentia] cust.omers whose e.nnua,l 'Jsage exceeds 250~ 000 thernls at a single address. Seven Palo Alto induetrial cuetcmerB with 14 accounts (meters) meet this crit(:!ria. Core customers are defined as residential dnd non t'eaidential customers using less t.han 250,000 thermo. Such d"lfinitiohs are consistent with the industry. Transportation 80rvlces in California are not available to residential and other core cuatrn~cr8 because their usage levels are generally too emall to rr.ake it ""'orthwhile to "bypass" the local utility. A CtlstomCl.· who chooses to "bypass" the Palo Alto Gas Utility must contract .,lith the City to transport its gas from the State border to the City's receiving station and then through Palo Alto's distl"ibution B}"otem to the customer's facility. Rate Schedule G-3 separatcs the coat of gas transportation from the cost of gas prOCUI'C!TIent. Some of Palo Alto' 8 l«rge customers have been approached by competing ga.9 suppliers with proposals to lower their gas bills. The Veterans Administration (VA) Hospital has requested that the Gaa Utility establish a natural gas transportation-only service. 1\ltllOUgh Palo Alto's Gas Utility is not rcgulated by the Federal Et~~rgy Regulatory Commission or the California Public Utilities Commission, it ie the Gas Util ity' s policy to provide its customers with services and rates similar to those available from Jnvestor owned utilities. Consequently, it is appropriate for Palo Alto to establish a gas transportation-only service. Such services and related rates are becoming common in the industTY. A consultant cost-of-service study has been conducted to calculate an appropriate gas transportation rate. The resulting rate for transportation-only service is 17 cents per therm as stated on Hate Schedule o· 3. Off~ring gas transportation-only service at:. thi~ rate wi 11 not have a significant k"eVenUe imp,act on the Gas Utility or its ratepayers. Among the policy issues raised by this proposal are: CNR, 238,94 2 .. \ \ 1. Should the City :lllow customerG to Becure utility services from other competitors 01' should such customers be denied access to potential sources at lower coat to them? Staff proposes to allow Palo Alto' B large cOfnfr:erci.ll and industrial cuBtomeru the opportunity to shop for competitive 9~D prices. Thereby. Palo Alto~ 8 large businesses ar~ afforded the same oppot'"tunitiea they 'Would ha.VR if they ",'ere located in lJurrounding areas. The Utilities Advi80ry Corr .. ."iasion (U1\C) supports this staff proposal to provide p .... anepol·t4tion servicos and rates as an o})tion to large l>al.o Alto b~18inelJS~8. 2 .. Should an electric generation facility, using less than 250,000 tncrf.'!-9 annually, be provJded the option to transport gas? Staff proposes to broadtm the ~pplicabil ity of Rate Schedule G-3 for such a cuetorner. In thia nvmner; the efficient use of natural resources is encoul:aged. 3. Should Palo Alto l fJ tralHIp-'..>rtation-only service rate be set belo· .... coot-ot-Bel-yice to· achieve closer rate parity ""ith PG&8's correopond\ng rate? At this time, staff proposes to continue to b.:1se ito gas tarif.fs on c0st-of-sel"vice principles to pn>rnote equity. Ho~'evcn:, if such a policy p;coduces unfa\torable results in the long-term. a-taff may recorr.!]1elld a shift in raterilaking policy closer to market-based pricing. Choosing t~an~portatioJl-only ael':'vice means the customer is fully rC_Gponsible for the acquiait ion of its gas supply and all the intor8t~te tx'anRportatlon serviceB necessary to deliver it to the State boxder. When a qualifying tran6portation~only customer (TOC) elects thle service, tho TOe mus.t sign a tl"ansportation contract with the Palo Alto Ga. Utility, Th~ terms an~ conditionG addruPD the responsibilities of the Gas Utility and, t;:he roc. Service fo:r nOll-core customers may be curtailed at the Utility's discretion if an emergency core demand arises, In the event i'I customer fails to curtail, the cuotomer will pay a penalty as-set forth in the contract. Also, the choice of transportation-only service by majol.' cUBtome:n~ will be limited to specified "open seaDons ll in order to plan for the timely acquisition of gae supplies by staff, CMR:238:94 3 \ \ o In providing it transportation-only service to ita non-core cU8tomers, Palo Alto's 0"0 Utility takes on .\n adminiutrat1vc burden, :,~onitorin9 each TOe' B purchases and actual ue-e on a daily basis will be required by staff. Expclwive ~terin9 and -,telemetering equipment will be in9talled on TOes premises. The 'required devices will be installed by tl1e staff but paid {Ol' by TOes. The TOC will 'also be reapont;ible for any adminieu:ative costs the Gas Utility, may incur in pl"o· .. iding Uds service. In this manner, the GaR Utility will l"ecoV'.ct' any addit.ional coats to serve TOes. In developing the new t:ates~ the follow-ing obj.~cti\'e9 WtHC "'ppiied: 1. The rates should reflect th~ cost·of-uervice. 2. The rates should be easy to cxpl'''in to the Cit)" s customers and administrativel}' feasihlc, J. Customer class subsidies should be minimized. Palo Alto's cOBt-baaed transpol"t(\tion :r:ate for nOJl-con~ cua::orr.ers is calculated to he 17 cents per ther~, This r.lte incitlder. the PG&E intrAstate transportation cost to the City. The. rate is highet· than PG&F.'s industrial transportation rate of 10 .'} cents per therm, One reason accounting for this cost <Ii t fe':!:'ent ial is tile fact that PG&E serves a large IlU~:r of customers in theh: nOIl·core class with more favorable load characteristics. ConseqtJently, PG&E's alloc<lted cost in serving these customers is rt'latively lower, under the proposed rate ochedule, seven la:t.'ge non".resident ial customers will have the choice of purchasing their gas from other suppliers in conjunction with transpoJ.·tation-only set'vice, or purchasing the gas and transportation fxom the Gas Utility. The non-core classification will result in some customerB becoming eligible to receive gas service at a lower )."ate' than under their current rate schedule. For these customet'S (appl'ox:imately 5 accounts), their gas bills will decl'ease by approximately 2"1 percent. The potential revenue shift, if the seven eligibl~ customers elect non-core service I is approximately $282,OO{) (1.5 percent of annual sales) which is allocated to the core custOi'nel.·s. St.aff does not CMR:238:94 4 view this as a signtficant impact. With the introduction of Gas Ra.te Schedule G-3, Rate Schedule G-5.0 is necessarily diacontinlleu. Fin'ally, one unique customer~ the Palo Alto Landfill Gas project. has been served under the G-50 Gas Rate Schedule since July 1992. However, this customer's annual gas consumption does not meet the qualifying critcl"ion of 250,000 therme. Due to the fact that this customer has been using gas to generate electricity from refuse, and because the City's philosophy is to encourage the efficient use of re-sourcee, staff recommends that the applicability of Rate Schedule 0-3 be expanded to include customer facilities Hhicil born natural gas to produce electricity. Reco:rm!.andatiQn Staff recommends Council approval of the attached r.eaolution establishing gas transportation-only service undel.-Rate Schedule G-3, and approval of a standard contract for trallspol:tation-only service customers to become effective July 1, 1994" Respectfully Submitted, L~~ LUCIE HIRMINA ul:/~;at.e 7 1YBt EJ)W;&~~~K '. ector :;B..ties £~ING~ Manager Attachments! Renolut ion Rate Schedule 0-3 CflR:238 :94 5 \ , .. follows: / (\ \,:.---.y RESOLUTION NO. RESOLUTION OF THE COUNCIL OF TliE CITY OF PALO ALTO RHPEALWG UTILITY RATI1 SCHEDUI,g G-50 AND ADOPTWG NEW UTILITY RATE SCHEDULE G-] OF THE CITY OF PALO ALTO UTILITIES RATES AND CHARGES PERTAINING TO NATURAL GAS TRANSPORTATION·ONLY SERVICE The Council of the City of Palo Alto does heJ':'eby RESOLVE as SECTION 1. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, schedule G-SO is hereby repealed and reincorporated in new Utility Rate Schedule G-3 of the Palo Alto Utilities Rates and Charges to read as shown on Sheet G-3-1, attached hereto and incorporated herein by reference. The foregOing Utility Rate Schedule, as adopted, shall become effective July 1, 1994. ~.cr .. !ill:L2., The Council finds that the revenue derived from the authorized adjustrnE>:nt of the natural gas transporation-only service rate shall be used only for the purposes set forth in Article VII. Section 2, of the Cha~ter of the City of Palo Alto. SECTION 3. 'rhe Council finds that the adoption of this resolution does not constitute a pt·oject under the Cal ifornia Knvit"onmental Quality Act. California Public Resources Code section 21080, subdivision (b) (8) . INTRODUCED AND PASSED: AYllS: NOES: ABSBNT: ABSTENTIONS: ATTEST: APPROVED: :-:-c----------------.. -l-1ayor AP PROVED JlS '1'0 FORM: ~271)'() 001OlS8 . , . -.,' o NON·CORE NATURAL GAS SERVICE UT!! ITY RATE SCHEDULE G-3 A. APPI.ICABILITY: Thls scIledul& applies to non·core serviOe for custorr,ers who use atle8st 250,000 tIlerms per yeat per service address. In add~ion, ihls rate scl1edule applies to customers who use natural gas to generals electricity. B .• n:RRtTORY: W,thin the servi<:G 0'<)8 of tile City of Palo Mo and on land owned or leased by tile City. C. RATES: Per Meter Per Month 1. Commodity ChaIge Pel n,erm ............................... 23.3¢ 2. Transportation ChaIge Per Iherm ....................... 17.()¢ D. SPECIAL CONDITIONS: 1. Sewice under thiS sci1cdule is subject to discontinuance in whole or In part in case of 8'1ual or an!Jc;pated shortage 01 na!~ral gas resuhing from an insufficient supply, inadequate transmission or delivery capacity of facilities, o. shortage requirements. tloW6ver, the City will ONemptlo minimize disfUplion by providing adequate notice prior to cunsHmenl. 1116 City will no! bo liable for damages OC"--lIsioned by interruption or diSrontinuance of serviOe supplied underlhis scl1edule. 2. SpecifiC terms and conditions shall bo covored by separate agreement between the City and customers served under this 18te scl1edule. -----_ ... -... __ ... _------------------ CITY OF PALO ALTO U'l'ILITIES Issued by the City Council Effective 7·1·94 Original Sheet No. G·3·1 " . ",", AGREIO<IXIlT 110. FOR N0I1·COlUl NA'l'\TAAL GAS-RATE SEIWICRS 81m<J!BlI TlIl! CITY OP PALO ALTO AND --.. -.. -~-- THIS, AGRRR.t.iIUrr NO. -. ___ , ___ ._ .. _ ("'Agreement-) is entered , 19 .. by and bet .. een the City of Palo Alto. a cIt)1 an(f munic1pal cOl'"poratlon of the State of Califol-nia and located at into on chartered {IiCity") , Palo Alto~ County-of San i-a Clara. cal~fornia (iCiiSl-cinor..,-:---'----' IIITNBS81M'l1, WHER RAS , tho City in its propl'ietaq capacity operates a natural 9as ~ltility which supplies natl,lral gao and provides natural gas transportation services to both rcsidcllt:ial and non~1-e9idential customers located wlthln the limits of the City of Palo .Alto; and WHSRHAS, the City intends to suppl)' a1 igible 11011- residential custorr.~ra. with eithel.· natttt:al gas .c;;nd natural gas transportation {h.~rvicee or only oatural gas transportation services. on terms and conditions siroilt'll' to those oftel'cd by local pxivate and public utilities, and WlI8RRAS. the City has adopted utiliq' rate schedules tor the supply of natural gas and th.e rendering of IHH.ural gas transportation services to conownet'$ of natural gas; and WHBRBAS. the Customer is eligible to receive Non·Core Rate Selvicea at one or more of its sel:vlce addresseR; NOW. THRREPQRR. in consideration of the following covenants, terms, and conditions, the parties agree: 1.0 IDil:ltUTlQ.NS. The terms used 1n this Ac..:rcement shall have the meanings set forth below, unless the context c.J.early indicates otherwise. 1.1 ·Bundl.d Rate-means that portion of the Schedule G- 3 Rate which applies to the supply of n~tural gas and the rendering of natural gas transportation services to a Supply and Transportation CUstomer. the the 1.2' -City Gate-means allY point of connection between natural gas transportation facilities of. the Transporter and natural gas distribution system of the City, 1,3 "Delival·ic9-means tha quanti Lies of natur31 gas ordered by the Non·Coloe CUstomer and del iven~d by the 'I'ransportel' to the City Gate. 1 r""~' I, ,"'" ." ... " .... _ ••.•• '.' \. , I I I 1.4 -Mojave-means Mojave Pipeline Company, a Texas generp;l partnership. 1.5 -Nou·Core CUstomer-means a non~r-csir1ential natural gas customer who consumes or uses at any Service Address 250.000 Ol" more therrns of natural gas per year and who elects, ill w,dting, during an Open Season to receive and pay for Non·Core Rate ServieNt under the Schedule G<3 Rate, as amended from time to tIme, or aoy successor rate which applies to Non·Core Rate Services. 1.6 -Non-Core Rate Services-means either the supply of natural gas and the rendering of natural gaa tl"anaportation services or only natural gaB transportation services under tho Schedule G·3 Rate. 1.? "Open SelUJOU-means that period of time eHtahl iahe-.i by the City in which a non~residential natural gils cHRtorr.er n\.'\y elect to be treated as a Non·Core Customer. 1. 8 "Peraon-means an individual. partnership, a joint venture, a b\.winees truat~ of business association. a cOl"poration, a and any. otheT form 1.9 IIPG'13" me~nB Pacific G(l8 and Electric COf'tpany. a Ca.l.i.t'ornia corporation. 1.10 "Rules" means. without limitation, those laws l statutes, ordinances, resolutions, policies. schedules, rules and regulations governing Non-Core Rate Services provided by the City. including any provision of this Agreement r to which a Non-Core CUstomer may be subject or bound. 1.11 -Schedule G-2 Rate" meanFJ the rate chaTged for the supply of natural gas and t.he rendering of natuX'"tl;l 9aa . transportation servicea to residential and non-);(!sidE>ntial' customers under Schedule G·2 of the Palo Alto Utility Rate Schedules; as amended from time to time. 1.1Z "Schedule 0-3 Rate-means the rate charged for Non Core RatP' Services to a Non-Core Customer under Schedule G· 3 of the Palo Alto Utility Rate Scheduies l as amended from time to time. 1.13 -Service Addrel!ls" means a business locatioll of a Non-Core CUBtomer identified in Appendix 1\ at whiCh one or mote natural gas outlets are maintainEd. 1.14 -Supply and Transportation Customer" means a Non Core Customer who elects to receiv~ the supply of natural gas and the rendering of natural gas transportation services from the City, 1.15 "Supply Noeds" means that metered qU<'lnti ty 'Of natural gas which is consumed or used by the: Transportation Customer, including all quantities of natur.c:!ol gas shrinkage or equivalent, as such shrinkage shall be determined in accordance \. "_"0'<:. , i r 1 , ! ,',> "'i with the provisions of the natural gas transportCltion agreement between the City and the Tranaporcer. 1.16 ·~xaDsportation Custo~er~ means a Non-Core Customer who elects t·o !:"eceive only natural gas trdnsportation services from the City. 1.17 "TX'&D.sportation Rote" meanu that portion of the Schedule G~3 Rate which applies only t.o natural gas transportation se:.vices provided to a Transportation CUstomer. 1.18 -Transporter-means any Person who is under contract to the City to transport natural gas within the State of California from the california bordet' to the City Gate. 2. 0 T.~F AGREBMBNT. The term of this Ag:ceement shall commence on the date on which the Schedule G-3 Rate applies to the initiation of Non-Core Rate Services at the Setvice Address and shall continue, unless and until one of the following occut"s: a) The Non-Core Customer elect.s tc be subject to the Schedule G-? Rate or any other Palo .Alto Utility Rate Schedule other than the BuncHed Rate or the Transportation Rate during an Open Season; or b) The Schedule G-3 Rate is repealed permanently; or c) d) The Customer failf:i to comply '"lith the provisions of this Agreement or fails to qualify for the Bundled Rate or the Transportation Rate~ as appropriatej or The City exercises its right to teminate this Agreement, without cause, upon sixty (60) days' prior written notice to the Non-Core Customer. 2.1 The City, in the exercise of its sole and complete . discretion. may determine the duration of the Open Season, determine whether the Schedule G-3 Rate, or an amendment thereto, should be re:pealed, .or permanently or temporarily deny the Non-Core CUstomer the privileg~ of receiving Non-Core Rate Services under either the Bundled Rate or the Transportation Rata. 3. 0 ~!ldule G-3 Rate ..!Ui9.U>.ili~~- 3.1 A non-residential natural gaB cust0l11er "Whose annual natural gas· consumption or usage is equal to or exceeds 250,000 therms shall be eligible to qualify as a Non-Core Customer and pay for any Non-Core Rate Services, provided that the City first approves of the application of the non-reRidential natural gas customer. The consumption or use of natural gas by the Non-Core Ct:stomer as measured by the gas meter or meter.'3 at". the Service Address shall be aggt"egated for the purposes of determining the SCh<edule G-.3 Rate eligibility of a non-residential natural gas customer. 3 \ \ .. I i , . ,. e "t·' .. r············-· , . 3.2 The right of a Non-Core Customer to ..receive on-going Non·Core Rate Services shall be suspended for a period of not less than one (1) year-aft~r the date on which the Buspenaion takes effect, if the Non-Core Customer is in default of any obligation under this Agreement. Upon the receipt of evidence by the City that. the Non-Core CUstomer can fully discharge its obLi.gations under this Agreement or otherwise will be re-cligible for Non-Core Rate 'Services, the Non-Core o'H:t;tomer shall be pennitted to reapply for Non-Core Rate Services. The renewal of Non-Core Rate services shall be exerci8~d by the Non-Core CUstomer during the Open Season immediately following the reinstatement of the eligibility of the Non-Core Customer, or the right to Non-Core Rate Services shall irrcnf;!diately terminate upon tlle expiration of the Open Season. 4.0 l.nitiation of Non-CorLJ@U Seryi~. A non- residential natural gas customer shall be entitled to receive any NOrl-Core Rate Sel.vicea r provided that the following occur: a) The non-residential natural gas customer completes in all respects an Application for Non-Core Rate Se.rvices, pays any reqaired fee, and is. determined by the City to be eligible to receive Non-Core Rate Services; and b) During the Open SeaBon, the non-t'esidential natural gas customer elects, in writing, to receive Non Core Rate Services; and c} All necessary upgrades to the Non-Core Customer' 9 gas I'l"lBtero facilities ar~ made; and d) Full payment of the actual costs of upgrading the Non-Core CUstomer's gas meter facilities by the City is made by the Non-Core CUstomer, 5.0 ~ Matera. The Non-Core CUstomer agrees to pay the City within thirty (lO) days of receipt of a written invoice for the actual costs of the City in necessarily upgrading the gas meter facilities at the Service Addrees. 6.0 Curtailment of Non-Core Rat~ Services. 6.1 The City, acting in its sole and complete discretion, may req-o.lire the Non-Core Customer to temporarily curtail and interrupt any or all portions of its natul'al gas supply np.eds. Upon the receipt of written notice by the City to curtail and interrupt any por,tion of its natural gas supply needs~ the Non Core CUstomer shall promptly r.educe its consumption or usage of natural gas to that quantity which is equal to the lesser of: a) The cumulative amount of natural cras nominations of the Non-Core Customer made duri-ng the period of curtail-ment. or ,. , 4 .. ', 0. , bJ The cumulative amount of natural gas permitted to be consumed or used by the Non·Core CUstomer during the pa-riod of curtailment as authorized by the City. For the purposes of this Section 6.1, the term -nominations'" shall apply to the daily aJ'I1Ount of natur~l gas ordered by the Non-Core Cuotomar. 6.2 At\}' noti'cQ( including. without: limitation .. a notice concerning curtailments, shall be, sent to the addl.'essee at the addLeas set forth balow, or to any other address subsequently noted, in 'ltriting, by facsimile t:t'anemission and followed by a wl.·itten copy or such transmission to tile addressee, ae follows: CI1'Y FI\X: ( C(JW1'OMllR PAX"--)--_-___________ _ 6,3 A failure by the Non-Core CUBtomer to cm:tail ita cOll6UlY1ption or \lsage of natural gan ,at any Service Address ahall cOllstitute a default-uuder this "greement. Upon the occurrence of such default I tha City may declare that the Non~Col .. e Customer is in ma.terial breach of this Agreement. In addition to the rights a'ild remedies made available to the C!t}o· 'by applicable law, the City shall be entitled t.o charge and collect from the Non·Core CUstomer: aJ The cost of the vol~ of natural gas taken by the Non·Core CustClft\El'r during the period of curtailment which is ill excess of the reduced a!l1Ount; and b) An amount equal to five dollars ($5.00) per therm of nat\.1ral gas taken by the NOil-Core Cl.lstomer during the curtailment. period which is in excess of the reduced amount; and c) In-vnediately Busp(lnd the rights of the Non-Core Customer to receive Non-Core Rate Services. 7.1 The Non-Co}.''C Customer vohmtarily assumes the risk of any economic 01," non· economic loss or darr.age accruing as a result of the following: a) 'rhe loss of any quantity of natural gas, whether such natural gaa is located in the distribution syst.em of the natural gas supplier, the interstate 5 '\ ''-':-;:\:~-~:'--,:~:-,: ~, ~~tj:~i:~~wv~l~~~-", , b) -." natural gas transporter, City; the Transporter I or the The lose occurs as a :n~all).t of a decision by the City to curtail the consumption or usage of Ilatural gas by the Non-CQre CustQ~r; or c) The' lOBS occurs a9 a rosult of a decision by the City to change its supplier of nat,ural gas or its natural gas tranapo~ter. 6 • 0 HAI-i'I!E. 8.1 The waive1' by " pa.l'"ty Qf' any breach of any provision of this Agreement shall not be deemed to be a waiver or cont inuing waiver of any subsequent. bre(lch of the sarr~ 01' an~' other provision of this Agt·eement. 9.2 Thp. Non-Core CUstO!l"ler waives ~ny and all cla:lms 0):" causes of action against the City, ito cO\lncil fl.E'!f'bersj officerl3~ agents, and employees, 'IIIhic11 it m.:ty now or hCl'cafte1-ha.ve at a.ny time for any economic or non-econOO'lic dau-age suffered by the Non Core Cust.omer as a :r:esult of a curtailment. of its 811pply of natUl;'c11 gas, except as such claim or cause of action !My arise frO!"n. the active negligence or the willful misconduct of the City, its council members. off icers, employees, ,,:,or agents. 9.1 The provir.ionSi of this Section 9.0 shall apply only to a Transportation Customer. 9.2 The City represents that it has an existing contract with PG&g for natur,al gas transporta-tion aervices. that it i9 currently negotiating with ,...ojave for natural gAS transportation services, that a contract "With Mojave for Buel"! transportation eervieee may take effect in January I 1996, and that ~·'ojave may become the only means by which natural gaR can be brollght to the Cit.y Gate (or delivery to the C\lstomer. The City "Will provide written. notice of any schedule adj'.lstments to the Transportation Customer as such information may become known by or Cl'I<,de av.::111able to the City. 9.3 The City shall not lx! 1 iable for any damages or losses incur.rp..d by the Transportation C\I $ tOIl"'..e l' as a H~E1Ult of the te~~ination of the contract between the City and PG&E and execution of a contract b~cween the City and Mojave for natural gas transportation services, Such losses may include, without limitation, 10s8 of beneficial use of natural gas supplies or: natural gas transportation service agl'cementa occasioned by a decision by the City to change its natul'al gas supplier or natural gaa trAnsporter. To the extent it i(~ teaf.Jible to do so, the City will assist the Tt'ansportation Customer in ilny attempt by the Transportation Customer to mitigate such losses, provided, however, t,he Transportation Customer shall compensate the City for actual 6 .' \ r i I , (, costs incurred by' the City in furnishing assistance to the Transportation Customer. 9.4 The City will publish natur.al gas nomination and scheduling procedures in a document entitled "Palo Alto City Gas Scheduling Procedures. II This document, which shall be part of the Rules. may be revised from time to time. 9.5 The Transportation CuHtomer agrees to assume full responsibility for: a) the acquisition costs of its Supply Needs and any interfltate natural gas transportation servicE!s needs necessary to effect Deliveries; and bl compliance with the natural gas no .. nination and scheduling procedures to effect Deliveries. At the City' B option~ the Non-COl"e Rate Services provided to the Transpm.'tat.ion Customer rnay be te.rminated, if the Transportatiorl CUstomer fails to comply with the natural gas nomi.nation and scheduling procedures. 9.6 The Customer shall he solely responsible for balancing its Deliveries into the City l 8 natuL<al gas distrib~ltion facilities with its Supply Needs on a monthly basis. hny imbalances of more than ten percent (lO') between its DeliveL"iea and its Supply Needs will be traded by the City on a monthly basis in the following manner: al b) The Supply Needs shortages will be sold by the City to the Transportat.ion CUstomer at. one and one-half n. S) times the PG&:E Core-Subscription Rate ior replacement schedule) for the month; and The Supply Needs overages will be bought. at one· half CO. 5) times the PG&& Core-SUbSCL'iptioll Rate {Ot' replacement «Jchedulel tor t.he month. 9.? The needs of all residential and non-residentic-.I nat.ural gas' customers shall be given preference over the needs of any Non~Core CustQ~er during any period of curtailment declared by the City, ~ihenever the quantity of natural gas acquired by the City is insufficient to meet the needs of all natural gas customers other than Non-Core Customers. the City shall have the right to appropriate the Deliveries to the Transportation O..lstomer during the period of curtailment. In such event, the City will augment its natural gas supply by drawing upon all Deliveries to 'l'ransportation CUst.omers. The City shall draw against the Deliveries of all Transportation Customers on a p:ro-rated basis during a period of curtailment. In the event that Deliveries are appropriated, the City agrees t.o compensat.e each Transportation Customer for: ? ! !.>., I ~ I l t \' 1. a) The interstate transportation volumetric charges, if any, for the appropriated Delive~ies; plus bl cl Tpe natural gas supply volumetric chargee, if any, fvL· the appropriated Deliverics; pluB The per diem reservation chargee. if any, for the interotate transportation for the number of days during the period of curtailment when Deliveries are appropriated. 9.8 If the City is required to per.form additional administrative services in providing natural 9as traneportation only servic.es to t,he Transportation CUstomer. the Transportation CUstomer shall be charged a fee of $200 pet' month for such additional administrative services 01' a fee as established under the Pa.lo Alto Utility Rate Schedules or the Municipal Fee Schedule of the City. The Transportation CUstomer agrees to pay for such charge within thirty DO} days of receipt of a bill for the same. 10.0 ~lLI.J\NEQrJS , 10.1 The Customer shall comply with all federal, stater and local laws, rules. regulations, ordinance, and resolutions governing the Non-Cox:e Rate applicable statutes, Services. 10.2 This Agreemet.i.t shall be governed and construed in accordance with the laws of the State of California. 10.3 Neither party shall be deemed in default on account of any delay or failure toO perfonn its obligations under this Agreement which directly results from an Act of God. 10.4 The headings are not a part of this Agreerr.ent and shall have no effect upon the C:Ol"lf:ltruction or interpretation of any part of this Agreement. 10.5 All exhibits, addenda, appendixes, or other attachments to this Agreement which may from time to time be referred to in any duly executed arr:.endment to thifJ Agreement are by such reference incorporated in this Agreement and made a part hereof. 10.6 This Agreement constitutes the entire agreement between the pat·ties concerning its subject matter, and there are no other oral or written agreements between the par~ies which are not incorporated herein. 10.? This Agreement shall not be rnodif.ted, unlesB the parties fi"X'st agree to and approve of such modification in writing. 10.8 If a court of comp~tent jurisdiction finds Ol' rules that any provision of this Agreement is void or unenforceable, the other provisions of this Agreement shall remain in full force and effect. 8 ,:, • I I I , ' I I 10.9 The provisions of this Agreement shall apply to and bind the successors and assigns of the parties. 10.10 In the event that,suit is brought by a party, the parties agree that tri-al of such action shall be vested exclusively in the state courts 6f California in the City of San Jose, County of Santa Clara, or in the United States District. Court in the Northern District of California in the City of Sar, Jose. RXBCUTBO BY THE PARTIES on the date first above stated. A'rTBST: city Clerk~-------~~-~---- APPROVBD AS. TO FORM: APPROVED: DIrector of Pi"nance-------- b i rector of"'u""tTI"Ur.t"iC::.:::.:----<-< CITY 01' PALO AL'IO Mayor By: ______ ~ ____ _ Title: ____ _ 9 '\ STAT& OF COUNTY OP I' ....... ; CBRTIPICATB OF ACmOWURDGHENT (Civil Code S 1199) 011 I before me, ."_ ... _______ ._~~" -----re<i----' a notary publIc in and for Baid County, personally appear __ t IXH.'Bon8IIy---kno;.n-iQ-~-"'-fot-~p-rove{f to me on the baSiB of eat'1eiactory evidonc.a} to be the person(s} whose nama(s) La/are subscribed to th~ within instrument, _____ . _________________________ _ arjdackiiowfedge-d-to l!\e that--he7B-h~Ithey'·-e-xccute-d the orur,e ill hisi her/theh" authol-ized C'apacityUes), and that. by his/her/their signature(s) on the ir.otnlmp.nt the pe.:son(s) ~ or the entity upon behalf of which the person (a) acted, ex~cuted the instrument, WI'INBSS my hand and official seal. -----------------. 10 . ',; \ Appentli>c A to Rate AQRgBMRNT NO. Customer __________ __ Addt'ess Dat,e Meter No.1 Location Description 1. Mete~ Locationj and Number: -----.--_._-- ------------- Annual gas flow: Facilities Upgrade Cost: _________________ .. _____ _ 2. Meter Location/ and Number: -------------- Annual gas flow: ____ _ Facilities Upgrade Cost :.'"_~ __ ~ ___________ _ 3. Metel:.' Location/ and Number: ----. __ ._---------_ .... _. __ .. - _._--_._-- ---~-.--.. --- Annual gas flow: Facilities Upgrade Coat: 4. Meter Locationl and NUmber: ----_._--_._---------_._--_._---_._---.-----, ---.-._--- Annual gas flow: Facilities Upgrade Cost:. _____ .. _______ _ Total Annual Gas Flow _____ ~ Total Facilities Upgrade Charges $ 11