Natural Gas Pool

About the Gas Pool

Who May Participate?

The ABAG POWER Core and Non-Core Aggregation programs are open to all local governments and special districts in the Pacific Gas and Electric (PG&E) service territory.

What is a Core Aggregation Program?

A Core Aggregation Program allows customers to aggregate their natural gas accounts together with others for the sake of purchasing natural gas in bulk from a third party supplier. In order to participate in a Core Aggregation Program, customers must sign up with a Core Transport Agent. ABAG POWER is the Core Transport Agent for the ABAG POWER Natural Gas Purchasing Program. In this role, ABAG POWER:

  1. purchases natural gas for all participants;
  2. provides PG&E with nominations;
  3. contracts and pays for interstate pipeline charges;
  4. provides gas balancing service;
  5. provides consolidated billing for natural gas, transportation and distribution;
  6. coordinates gas storage requirements; and
  7. brokers excess gas and pipeline capacity.

Larger accounts (over 20,800 therm/month) may join ABAG POWER's non-core program and take advantage of reduced transportation and distribution rates not available to PG&E customers.

Through a Natural Gas Sales and Aggregation Agreement, participants designate ABAG POWER astheir exclusive agent in performing these functions and agree to pay ABAG POWER all natural gas charges, including operational and administrative costs.

ABAG POWER's Natural Gas Rate

ABAG POWER's natural gas rate is set periodically by an Executive Committee made up of members of the purchasing pool. In setting this rate, ABAG POWER strives to balance the goals of members to achieve both price stability and cost savings. This rate may be either fixed or variable (or a combination of the two) depending on the gas purchasing strategy approved by the Committee. Please contact staff to find out the latest rate structure.

ABAG POWER's Fees

Fees to cover the operational expenses of the program are set annually by the Executive Committee. These fees cover expenses such as: gas scheduling and management; billing services; legal services, and administration. Currently these fees represent approximately 3.8% of the program budget.

Reliability and Maintenance

Participation in ABAG POWER's Program assures no change in participant's current priority of service with Pacific Gas and Electric Company (PG&E), quality of natural gas, overall reliability of service and performance of maintenance. PG&E will continue to provide meter reading, "on the ground" repair and maintenance, and emergency response to all participants.

Single Bill System

Participants will receive a single monthly bill for gas service from ABAG POWER, even though the gas and the distribution services will be provided by different companies. In addition, the ABAG POWER bill will consolidate all your accounts into one summary bill.

Other Benefits

In addition to natural gas savings, participation in the Pool has definite longer term benefits. Participants will be represented on ABAG POWER's Executive Committee. This Committee will provide policy guidance and be instrumental in formulating future purchasing recommendations.

ABAG POWER continues to follow the issues and regulatory actions involving energy deregulation in order to keep our members up to date with the latest information. ABAG POWER has also become involved with energy efficiency initiatives that may be of significant benefit to members.

PG&E's Position on the ABAG POWER Natural Gas Program

PG&E's corporate policy is to encourage the formation of programs like ABAG POWER's. PG&E would like to see more of their natural gas customers securing their gas supply from other suppliers. However, this is not always known or understood by PG&E's community representatives who attend Council and Board meetings. With PG&E's assistance, ABAG POWER is taking steps to educate these representatives about our program.


TOP


Frequently-Asked Questions About ABAG POWER's Natural Gas Aggregation Program

  1. In the event ABAG POWER's gas supplier was to fail to supply natural gas to the PG&E system, what physical and financial risks do participants assume?

    Physical risk: Because PG&E's natural gas system is a fully-pressurized pipeline system capable of delivering natural gas at all times to the burner tip, there is no possibility that participants will find themselves without natural gas service due to a default of ABAG POWER's gas supplier.

    Financial risk: In the event, ABAG POWER's gas supplier was to default, ABAG POWER would attempt to obtain a natural gas supply for members at the same price. In the event ABAG POWER was unable to find replacement gas supplies at that price, participants would have the option of either returning to PG&E at their previous rates or securing another third party supplier of their choice.

  2. What liabilities or risks do participants assume if ABAG POWER chooses to issue a short-term financing to either pay for required deposits or to prepay the natural gas supplier (for an additional discount in the price of natural gas)?

    The Agency's Natural Gas Sales and Aggregation Agreement with ABAG POWER may be used as security for a short term financing in ABAG POWER's name. In the event ABAG POWER issues a note and then defaults on its payments, the bank trustee for the note would step into ABAG POWER roles as Core Transport Agent and continue the program. The participant's legal obligation in this event is limited to fulfilling the terms of its Agreement with ABAG POWER (i.e., to pay for all natural gas and transportation charges for natural gas consumed by the entity.)

  3. Will joining ABAG POWER's pool negatively affect the City or County's franchise fees?

    No. When an account becomes a part of the ABAG POWER gas pool it ceases to pay the procurement portion of the franchise fees (local governments are exempt from tariff G-SUR). At the same time PG&E ceases to remit this portion of the fees to the City or County. The City or County therefore remains financially indifferent.

  4. How will ABAG POWER's administrative fees be determined in the future?

    Each participants who joins the ABAG POWER program will appoint a member to the ABAG POWER Board of Directors. The Board of Directors is the ultimate authority for all actions taken by ABAG P OWER. In addition, members will have the opportunity to join the ABAG POWER Executive Committee. The Committee will oversee the operation of the Pool, approve purchasing strategies, and determine appropriate administrative fees.


TOP


Gas Purchasing Pool Participants

City of Alameda
Housing Authority of the City of Alameda
City of Albany
Town of Atherton
City of Benicia
County of Contra Costa
City of Cupertino
City of Fremont
City of Gonzales
City of Half Moon Bay
City of Hercules
City of Los Altos
City of Mill Valley

City of Millbrae
City of Milpitas
City of Monte Sereno
Town of Moraga
County of Napa
City of Oakland
City of Orinda
City of Pacifica
City of Petaluma
City of Pleasanton
City of Richmond
City of Salinas
City of San Carlos
County of San Mateo

City of San Rafael
County of Santa ClaraCity of Santa Rosa
City of Saratoga
City of Union City
City of Vallejo
City of Watsonville
City of Winters
Golden Gate Bridge, Highway & Transportation District
Regional Administration Facility Corporation
Vallejo Sanitation & Flood Control


TOP