Florida Gas Utility
4619 NW 53rd Avenue , Gainesville, Florida, United States

Mission

To provide comprehensive and reliable natural gas services to its members at a competitive price.

Vision

 To be the preferred provider of natural gas services for its members.

Values

Integrity, Commitment to Service, Fiscal Responsibility

Services

FGU’s dedicated staff provides a wide range of services to its members, all designed to reduce the complexity and workload to meet their natural gas needs. FGU works to achieve substantial savings through administrative efficiencies and reduced natural gas costs for its members.

GAS SUPPLY ACQUISITION

Natural gas is typically purchased from producers and marketers in four (4) ways. First, long term purchases (Project gas) are made through specific projects, such as pre-paid transactions which require the issuance of bonds, for extended periods of time, usually for ten (10) years or longer. Second, term gas purchases, typically for a couple of years or less, are also done to “lock in” favorable prices. Third, baseload gas is purchased for a calendar month at negotiated monthly prices to meet a portion of the monthly needs of each member. Finally, swing gas is purchased, usually on a daily basis, to specifically match the expected usage of each member with the total supply acquired through the four methods described herein. FGU secures a combination of long-term, monthly, and daily purchases with numerous natural gas suppliers and analyzes a variety of member-specific requirements.

GAS SUPPLY MANAGEMENT

Numerous producers and marketers have supply and are willing to sell it at specific locations along the interstate pipeline systems. These locations are called “receipt points” on the interstate pipelines. Florida Gas Transmission (FGT) currently has about 70 operationally available receipt points in its production area. The gas trader has to constantly evaluate what gas purchases (project, term, baseload and swing) have been made, at which specific receipt points the gas is being received at and which capacity contracts are being utilized to transport the gas to the appropriate delivery point. Hence, the gas trader has to navigate a complex set of variables to determine the quantity of gas to purchase at any given time. These variables include who to purchase from, how much to purchase and at what price, at what receipt points, what length of time (long-term or a single day), type of capacity being used (primary or secondary firm) for transportation, quantity needed by the member, monthly imbalance position and other important information. Establishing and maintaining relationships with potential suppliers is very important and being “in the market” on a daily basis increases the chances that competitive and reliable gas supply is consistently achieved for members. Traders also have to be aware of, and factor into this function, conditions that limit access to the interstate pipelines, such as maintenance activity, operational orders, force majeure events and other similar situations.

Financial Services Group

The Financial Services Group directs all the accounting and financial management activities of Florida Gas Utility (FGU). Responsibilities include administering, budgeting, managing, and coordinating the functions of finance, accounting, treasury and debt management, credit/risk management, and contract administration. Responsible for ensuring FGU’s assets, including all funds, are effectively managed and that accounting systems are properly maintained and in compliance with GAAP and other regulatory authorities. Other responsibilities include the formulation of FGU’s financial policies and development of capital projects. These responsibilities are generally referred to as “Back Office Support Functions”. The Financial Services Group also provides other member specific services such as, rate studies, financial analyses and various financial consulting services.

DELIVERY POINT OPERATOR SERVICES (DPO)

The primary function of the Delivery Point Operator (DPO) is to effectively manage and mitigate the potential negative effects of Operational Orders issued by the pipelines (Alert Days, Operational Flow Order’s, etc.) and month end imbalance positions. In general, the more members that belong to the same DPO account and the higher the scheduled quantities, the more likely it is to mitigate any negative impacts. Operational Orders, in its simplest definition, means daily balancing. Scheduled quantities must be within defined tolerances (over or under) when compared to measurement data from each and every delivery point (the “aggregated delivery points”) that the DPO administers for each day that an Operational Order is in effect. Failure to be within defined tolerances during an Operational Order will result in significant penalties. Similarly, month end imbalances, the difference between the amount of gas scheduled for the entire month and the amount of gas measured at the aggregated delivery points must be within established tolerances (less than 5%) in order to obtain the best cash-out prices. Of course, booking out imbalances with other Shippers is allowed and can be done to reduce the monthly imbalances below the 5% tolerances.