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Ohio Regulators Approve Columbia Infrastructure Program

The Public Utilities Commission of Ohio (PUCO) last week adopted a stipulation implementing Columbia Gas of Ohio's infrastructure replacement program. Among other things, it addresses ongoing safety and maintenance concerns related to natural gas line risers, which connect distribution pipelines to customer meters.

"This infrastructure replacement program will directly benefit Columbia's customers as public safety will be enhanced by allowing the company to take responsibility for the repair of prone-to-failure risers and customer service lines that have hazardous leaks," PUCO Chairman Alan R. Schriber said. "Customers will have freedom from the risk of major repair bills and the need to choose and hire repairmen for service work. Further, the program will provide customers with systemwide safety and a single point of contact in the event a leak occurs."

The program allows Columbia to assume responsibility for the immediate repair and replacement of hazardous customer service lines and for the replacement of prone-to-failure risers over a three-year period. The PUCO ordered Columbia to work with PUCO staff on expeditious scheduling of riser replacement work as well as repairs of hazardous leaks on customer service lines.

The agreement addresses concerns the Ohio Consumers' Counsel (OCC) had about safety as well as the cost to residential consumers for fixing risers prone to leaks.

"This agreement will result is a fair solution that will put customers' safety first while controlling the costs all customers will pay," said Consumers Counsel Janine Migden-Ostrander. "When the OCC found that another utility was able to solve the same problem in a more cost-effective manner than Columbia had originally proposed, we helped ensure that Columbia Gas customers would benefit from the same type of savings."

The OCC found that Duke Energy, another Ohio natural gas utility addressing gas riser concerns, was able to resolve safety problems without replacing as much equipment and using as much labor as was originally proposed by Columbia. The OCC was able to negotiate a requirement that Columbia review less costly options than it had originally proposed. Columbia agreed to use the more cost-effective process where circumstances permit. Based on revised cost estimates and the more cost-effective solution, the OCC estimates that $10-15 million or more could be saved.

In November 2006 the PUCO staff issued a report on a statewide investigation into the installation, use and performance of gas service risers. The report showed that upon review of a sampling of risers throughout major natural gas utilities' service territories, there is some risk with some field-assembled risers.

Customers who have already contracted with a Department of Transportation operator-qualified plumber to repair or replace a prone-to-failure riser will be eligible for reimbursement up to $500 for work done under the infrastructure replacement program. Those who do not wish to wait for Columbia to repair or replace a prone-to-failure riser will also be reimbursed by Columbia. Reimbursements are capped at $385 for full riser replacements and $330 for riser repairs that are made to the riser after last week's order. Customers are advised to contact Columbia before making repairs and to save receipts that show work done and amounts paid.Upon reimbursement, the customer service line or riser will become a capital asset of Columbia.

As outlined in the stipulation, individual customers will remain responsible for the initial installation of curb-to-meter service.

Last month the PUCO approved the recommendations of its staff outlining a natural gas riser safety policy. All Ohio gas distribution companies were to begin implementing the guidelines immediately (see NGI, March 17). That order did not address issues related to the ownership and repair of customer-owned service lines or financial issues, including the reimbursement of customers who have undertaken repairs of their risers or service lines. These issues are to be addressed on a company-by-company basis, the PUCO said, and several LDCs, including Columbia Gas of Ohio, had initiated related cases before the PUCO (see NGI, March 26, 2007).

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