Subject: fw : el paso had market power
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from : butler , janet
sent : tuesday , august 28 , 2001 4 : 45 pm
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subject : el paso had market power
in a release from natural gas intelligence according to ferc staff counsel , el paso natural gas and el paso merchant energy possessed market power during the summer of 2000 and violated ferc ' s marketing affiliate standards . the article states that el paso had market power after may 2000 for at least two months when pipeline capacity constraints created a separate relevant geographic market in california . the evidence pointed to the now - infamous february 7 and 9 , 2000 telephone conversations showing that the operating employees of el paso merchant , el paso natural gas and mojave pipeline " were not functioning independently , " according to staff counsel .
the phone conversations took place just days before el paso pipeline began its open season for 1 . 22 bcf / d of firm , capacity on its system ( bound for california ) , all awarded to el paso merchant .
before and during the open season , epme gained new information about the restructured long - term tiered discount on mojave to wheeler ridge while potential non - affiliate shippers were not according to counsel . as a result , counsel find that epme ' s group had an undue competitive advantage with the new mojave discount generating a successful bid for the el paso pipeline capacity .
ferc chief alj wagner is expected to issue an initial decision in early october .