RCA & FERC Hold Concurrent Hearings on Method
for Compensating Shippers on the Trans Alaska
Pipeline System
Anchorage, AK - The Regulatory Commission of Alaska
(RCA) and Federal Energy Regulatory Commission (FERC)
are holding concurrent hearings pertaining to the
appropriate revised processing cost adjustment to the
Heavy Distillate component of the Trans Alaska Pipeline
System (TAPS) Quality Bank. The TAPS Quality Bank is a
methodology established for making monetary
adjustments among shippers to account for the difference
between the quality of the petroleum shippers tender and
the quality of the commingled petroleum they receive.
The TAPS Quality Bank methodology begins by distilling
each of the relevant petroleum streams into specified
components. Each of the components is then valued. In
the case of the Heavy Distillate component this is done by
use of a reference price less a processing adjustment. In
a previous proceeding the RCA and FERC jointly
determined that the reference price used to value the
Heavy Distillate component on the West Coast is Platts’
West Coast spot quote for Los Angeles Pipeline (EPA)
Diesel.
Los Angeles Pipeline (EPA) Diesel has a specified sulfur
content of 500 parts per million (ppm). An adjustment of
6.4302 cents per gallon is deducted to reduce the sulfur
content from 5,000 ppm to 500 ppm to meet the sulfur
specification for the referenced product.
Effective June 1, 2006, Platts changed the diesel
reference price to an ultra low sulfur diesel with a sulfur
content of only 8 ppm. This product is now listed in Platts
as ULS (EPA) Diesel. The scope of these concurrent
hearings is to resolve issues as to cost elements that
increase or change as a result of the more severe
processing required to meet the sulfur specifications
associated with the new ultra low sulfur diesel price used
to value Heavy Distillate.
The hearing is expected to conclude on Wednesday, July
18.
For further information, visit the RCA’s website
at Regulatory Commission of
Alaska Home Page
to get further information by
looking at RCA docket P-06-10 via the RCA’s data page
search, available through the above link.
Press Release: RCA & FERC Hold Concurrent Hearings on Method for Compensating Shippers on the Trans Alaska Pipeline System
Date Issued: 7/17/2007