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Kansas Fast-Tracks Plan to Replace Aging NatGas Utility Pipeline

Kansas regulators on Tuesday laid out an accelerated plan for natural gas utilities to replace aging and obsolete pipeline infrastructure.

The final 52-page order issued by the Kansas Corporation Commission (KCC) follows a general investigation begun two years ago, which determined an accelerated replacement program was needed.

Atmos Energy, Black Hills Energy, Kansas Gas Service, which together deliver 90% of the state’s gas supply, participated in the investigation with consumer utility watchdog, the Citizens Utility Ratepayer Board.

The three utilities were ordered to develop a plan within three months to replace all bare steel and cast iron gas distribution lines in populated areas.

To support faster replacement of the obsolete lines, the three-member KCC created an Accelerated Replacement Program (ARP), which allows the utilities to submit a plan to the KCC and to charge up to 40 cents/month per customer to speed the process.

Under the ARP, the utilities are to develop 10-year replacement plans. Utilities would be required to file monthly progress reports with the commission.

Since 2008, the utilities have used a surcharge to recover investments for pipeline safety, but it had limits that would not allow for its use in the ARP program.

"Commissioners attached a number of conditions to the program to ensure utility accountability and reasonable costs to consumers," a KCC spokesperson said. The commission “took a significant step toward ensuring the future safety and reliability of the state’s natural gas pipeline system."

The state's gas pipeline system is "inherently safe," but nearly 5,300 miles of the 21,800 mile-long distribution network in the state were constructed with obsolete, mostly steel materials. Safety risks are expected to increase over time.

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