Organization of PJM States, Inc.Gas/Electric Panel

Stan ChapmanSVP, Marketing & Customer Services Oct 8, 2013

Columbia Pipeline Group (CPG)Pipeline• More than 15,000 Miles

– Columbia Gas: 12,000 Miles– Columbia Gulf: 3,400 Miles– Millennium: 180 Miles– Crossroads: 200 Miles

• Delivers Approximately 1.3 Tcf per Year– 5% of U.S. Market– Serves Customers in 16 States

Compression • 1.1 Million Horsepower• 104 Stations

– Gulf: 77 Units– TCO: 316 Units– Millennium: 2 Units

Storage• 280 MMDth

– 4.7 Bcf/Deliverability– 37 Storage Fields in Four States

Power Generation• 27 Power Plants on System

– 19 on Columbia Gas in PJM– 7 on Columbia Gulf are bound for MISO– 1 on Millennium in NYISO– 19.8 GW Capacity (12.7 GW in PJM)

Columbia Gas Transmission

Columbia Gulf Transmission

Crossroads Pipeline

Hardy Storage Company

Millennium Pipeline

Storage

2

Collaboration

3

Columbia Gas Transmission & PJM Collaboration Non Disclosure Agreement Joint Gas/Electric Harmonization Interests

3

Power Generation along TCO System

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US Generation Demand by Fuel

5

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2020 2025 20300%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Coal Oil Gas Hydro Other Renewable Nuclear

SOURCE: Pira 2012

PJM Interconnection

6

2009 2010 2011 2012 2013 2014 2015 2016 2020 2025 20300.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

CoalGasBi

llion

Kw

hNet Generation Demand

Gas vs Coal

Gas fired generation continues to gain market share over coal in PJM.

PJM Reserve Margins

7

PJM Projected Generation Surplus / Deficit

High CaseBase CaseLow Case

SOURCE: SNL Jan 2013

Power Load Challenges

• Gas vs. Power day disconnect

• Limited communications between participants

• Pressure guarantees

• Penalties may not incentivize desired behavior

• Daily vs. hourly contracting

• Lack of firm transport held by power generators

• Primary firm, secondary firm & Interruptible

• Not nominating proper quantities

• Does not provide for proper hourly flows

• Does not cover required transport quantity

• Swings on pipeline line pack

• Not nominating primary receipt points

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Gas

Electric FERC

Power Gen Transportation

Plants 19 Forecasted Peak Load Useage (Dth) 2,113,696 Firm Contract Quantity (Dth) 727,350

Plant Summary

9

10

Power Gen Transportation

BANGO

R/MET E

D

BIG S

ANDY

CALP

CHESTERFIE

LD

CALPINE/A

LLENTOW

N

COR B

ELLMEADE

DARBY

GELP

GIL

BERT

GRAVELNECK

HO

PEWELL C

OG

EN

HUNTERSTO

WN/M

ET ED

LAKE L

YNN

PEDRICK

TOW

N

RED HIL

L

ROCK

SPRIN

GS

12 PO

LE/CEREDO

WEST D

EPTFORD

WEST L

ORAIN

0

50000

100000

150000

200000

250000

300000

Firm Transport Peak Dth/Day

Dth

TCO Power Plants in PJM Footprint

The Puzzle

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FERC

MARKETERS ISO/RTO PIPELINES

POWER GENERATORS

?

PRODUCERS

Things to Consider• Encourage use of adequate transportation agreements:

o PJM to hold transport and release to generators?

o Flow through mechanism for transportation charges?

• Ask gas supply questions when dispatching:

o What type of transport (FT or IT)?

o What Priority (in the path or out of path)?

o Do you have supply for your transport?

• Develop new services if needed – customer driven effort.

• Encourage new and needed infrastructure

• Address disconnects between Gas & Electric communications & and energy days.

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