At Pacific Gas and Electric Company's OFO Forum on September 18, 2007, several issues were discussed and a few alternatives/changes in process were presented. Additionally, PG&E's California Gas Transmission has posted an OFO survey 
to gather its customers' feedback until January 10, 2008. Please refer to the issues and implications below as you complete the OFO Survey.
Increases in gas supply during Intraday 1 and Intraday 2 flow day cycles can cause inventory to exceed acceptable limits. There is no provision in gas Rule 14 to call OFOs with noncompliance charges during the gas flow day. The process that PG&E currently uses to control inventory under high inventory situations is to reduce the flow limit (constraint level) at interconnects to the prior cycle scheduled volumes ("Capacity Holding"). For example, if El Paso Evening Cycle scheduled volume was 500 MMcf, then the El Paso flow limit is reduced to 500 MMcf for ID1 processing.
Capacity Holding currently constrains all flow nominations even if they do not increase system inventory, such as deliveries to off-system destinations or to storage facilities. PG&E has explored two alternate ways to address the shortcomings of the current process.
One alternative is to automate the Capacity Holding process in INSIDEtracc so that nominations that are clearly identified with a destination of off-system or storage are exempt from the holding process.
Pros
Cons
Considerations
Pros
Cons
A proposal was made to modify gas Rule 14 so that the exemption basis for an OFO would be changed from $1,000 per OFO event to 1,000 Dth per OFO event, regardless of the $/Dth level of the OFO noncompliance charge for that particular OFO. For most OFOs, this change would have no impact because the noncompliance charge has been $1.00/Dth for 123 of the 159 events (77 percent) from 2005 through 2007 to date.
A review of customer behavior during OFOs indicates occasional and limited use of the current exemption (i.e., a customer increases its imbalance up to the exemption level), which has had negligible impact on overall compliance with OFOs and system operations. While any change to the exemption theoretically impacts the tolerance available to other customers, the current estimate is the proposed change will have no practical effect on operations and/or OFO tolerance bands.
Pros
Cons
Customers have asked PG&E to call OFOs earlier than its current practice of attempting to call them by 7:30 a.m., Pacific time. A key issue for PG&E is whether operational information is available to make the most informed decision about the status of PG&E's system inventory earlier in the day.
PG&E's Plan 5, available at approximately 5:30 a.m., shows the last forecasted operational data for the current gas day (the gas day that will be ending at 7:00 a.m.) At this time, PG&E also has an updated weather forecast but does not have updated information about customer intentions. During the time between when Plan 5 and Plan 1 are generated, PG&E receives updated information on both supply and demand forecasts for the next gas day (the gas day beginning at 7:00 a.m.). Plan 1, available at approximately 7:30 a.m., shows the updated set of data for the next gas day. Calling an OFO for the following gas day before Plan 1 information is available increases the possibility of either calling an OFO that is not necessary, or not calling an OFO that later becomes necessary due to updated operational information.
It is important to note that, with this proposal, PG&E may still find it necessary to call OFOs after the 5:30 a.m. time frame if conditions have changed, and the pipeline inventory levels indicate the need for an OFO.
The following historical data should help clarify the impact of calling an OFO at 5:30 a.m. versus the current practice of calling OFOs by 7:30 a.m.
| Actual Number of OFOs Called - When Did PG&E Plan Data Indicate an OFO? | ||||
| 2004 | 2005 | 2006 | 2007 (Thru 11/30/2007) |
|
| Total OFOs Called | 59 | 44 | 47 | 66 |
| OFOs Indicated at 5:30 a.m. | 39 66% |
33 75% |
21 45% |
32 48% |
| OFOs Indicated at 7:30 a.m. | 10 17% |
7 16% |
13 28% |
25 |
| OFOs Indicated Late Day | 10 17% |
4 9% |
13 28% |
9 14% |
In 2007 year-to-date, PG&E called a total of 66 OFOs. Of those 66 OFOs, 32 of them (48 percent ) were indicated at 5:30 a.m. and, if PG&E's practice were to call OFOs at 5:30 a.m., these OFOs would have been called at 5:30 a.m. rather than at 7:30 a.m. 25 of the 66 OFOs (38%) were first indicated at 7:30 a.m., and called at 7:30 a.m. The remaining 9 OFOs (14%) were first indicated and called later that day (sometime between 7:30 a.m. and 6:00 p.m.).
While history is not necessarily an indicator of future performance, one can make some observations. As shown in Table 1, about half of the OFOs PG&E called since 2004 could have been identified and called as early as 5:30 a.m.
As customers have observed, there are also times when the Operating Plan information at 5:30 a.m. seemed to indicate that PG&E may call an OFO, but later did not because operating conditions had changed to eliminate the need to call an OFO. PG&E reviewed this data, which is referenced in the following table (Table 2).
| Potential Increase in Number of OFOs | ||||
| 2004 | 2005 | 2006 | 2007 (Thru 11/30/07) |
|
| Total OFOs Called | 59 | 44 | 47 | 66 |
| OFOs Indicated at 5:30 a.m. But Were Not Called | 16 | 18 | 11 | 7 |
| Total OFOs Called Plus Additional 5:30 a.m. OFOs |
75 | 62 | 58 | 73 |
| Percent Increase Above Historically Called OFOs |
21% | 29% | 19% | 10% |
In 2007, there were seven days when the Operating Plan at 5:30 a.m. indicated that PG&E should call an OFO but did not for that gas day. If PG&E changed its practice to call OFOs as early as 5:30 a.m., PG&E would have called an additional seven OFOs in 2007 - for a total of 73 OFOs. This translates to a 10 percent increase in the number of OFOs called at 7:30 a.m.
The consideration of whether PG&E should change its practice to call OFOs as early as 5:30 a.m. is not a clear cut decision. In effect, some OFOs would be called earlier as customers have requested, but some would still be called at 7:30 a.m. or later. Additionally, it is likely that more OFOs would be called by adopting the practice of calling OFOs earlier, at 5:30 a.m.
At this OFO Forum, participants requested that PG&E do some additional research on the seven additional OFOs in 2007 (to date) that were indicated at 5:30 a.m. but were not called. Table 3 details this information.
| Instances In 2007 When PG&E Would Have Called An OFO Based On Data at 5:30 a.m., But Did Not Call an OFO For That Gas Day |
||||
| Plan 5 Date | Gas Flow Date | Inventory | Demand Forecast Change | Supply Forecast Change |
| Monday, 1/15/07 | Wednesday, 1/17/07 | Low | X | |
| Monday, 3/12/07 | Wednesday, 3/14/07 | High | X | X |
| Thursday, 6/14/07 | Saturday, 6/16/07 | High | X | |
| Tuesday, 6/19/07 | Thursday, 6/21/07 | High | X | |
| Monday, 7/23/07 | Wednesday, 7/25/07 | Low | X | |
| Tuesday, 9/14/07 | Thursday, 9/16/07 | Low | X | X |
| Wednesday, 10/10/07 | Friday, 10/12/07 | High | X | |
The information in this table tells us that there are both demand-side and supply-side changes that can occur during this 5:30 a.m. to 7:30 a.m. time period. Forecasted operating conditions can change due to a variety of factors that affect both the demand forecast and the supply forecast.