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Frequently Asked Questions: Balancing Cashouts

For imbalance cashouts, does the weighted system supply include California production?

Only deliveries via Malin and Topock to on-system end-use customers are considered in the commodity cashout price. Transmission cashouts, however, include all paths used for gas received (Redwood, Baja, Mission and Silverado) in the weighted system supply calculations.

Are cashout prices for Operating Imbalances based on prices for the supply month or on prices for the cashout month?

There is no cashout directly associated with Operating Imbalances. Any Operating Imbalance remaining after the Trade Period is transferred to the Operating Imbalance Carryover Account. A portion of this account (the Clearance Amount) becomes part of the supply for the next month's cumulative imbalance. Your status at the end of that supply month's cumulative imbalance Trade Period determines the cashout, if any.

For example, the operating imbalance for March can be traded in June. Any remaining imbalance will roll over into the Operating Imbalance Carryover Account. Of this account's balance, the Clearance Amount that rolls over into July's supply and will contribute to, or offset, the cumulative imbalance for that month. July's cumulative imbalance may be traded in August; any imbalance over the 5% Tolerance band will be subject to cashout based on July's prices.

The Clearance Amount is normally defined as 1/12 of the Operating Imbalance Carryover Account balance. However, if this account balance is between -5000 and 5000 Dth, a Core Transport Agent (CTA) may request to have the entire balance rolled into the following month's Cumulative Imbalance.

If you overdeliver, are you subject to transmission cashout charges?

Any overdelivery within the 5% tolerance band is considered the first gas through the meter the following month: there are no charges associated with that portion of the overdelivery. Any volumes remaining outside the 5% tolerance band after the Trade Period will be cashed out and the transmission credits would apply to those cashed out volumes.

How does Pacific Gas and Electric Company use the money collected as a result of cashout charges?

The revenues and costs associated with balancing service are recorded in the Balancing Charge Account. The balance in this account will be incorporated into core and noncore transportation rates as determined in Pacific Gas and Electric Company's next Cost Allocation Proceeding.