Utilities balk at proposed rule to require outdoor meters [The Philadelphia Inquirer]

Oct. 30--Pennsylvania gas utilities are raising a stink about a proposed rule that would require most indoor gas meters to be relocated outside, which they say would cost ratepayers $1.6 billion to achieve a "minimal" improvement in safety.

In a filing submitted this week to state regulators, the Energy Association of Pennsylvania says requiring utilities to relocate more than 850,000 gas meters over 10 years "is not based on recognized principles of risk management and gas safety, is not cost-effective, and is not in the public interest."

Philadelphia Gas Works, the city-owned utility that is being shopped to potential private buyers, would be hardest hit. Most of its meters are indoors.

Gregory J. Stunder, a senior PGW lawyer, said the new regulation would be "overwhelming." It would require relocation of 322,000 meters over 10 years at a cost of $826 million, consuming virtually all of PGW's annual capital budget now devoted to replacing aging gas mains.

The average PGW residential heating customer would pay $138 more a year over 10 years, the utility says.

The utilities made their arguments in filings due Monday with the Pennsylvania Public Utility Commission, whose staff is the final stages of drafting the proposed rule.

The commission two years ago issued an initial draft that raised objections from preservationists, who feared a proliferation of meters on urban streets. The proposed rule would allow indoor meters in houses in approved historic districts or neighborhoods at high risk of vandalism.

Utilities prefer outdoor meters, which are easier to get to and reduce their liability for indoor accidents. Their objection is that the new rule would require compliance in 10 years, which they say would divert money from more pressing safety needs.

"There's only so much money to go around for capital improvements," said Terrance J. Fitzpatrick, president of the Energy Association, the industry trade group.

The association suggested that utilities be allowed to replace indoor meters at a slower pace, coordinating the work with neighborhood gas-main replacements to lower the cost.

The PUC says the new rule is needed to bring the state's regulations into compliance with federal pipeline-safety rules.

The PUC is concerned that excavators can inadvertently snag a steel service line near a house, yanking an indoor gas meter loose. The PUC staff said there were 65 major incidents in Pennsylvania involving indoor meters.

PGW says it faces an "extremely low risk" of catastrophic meter accidents, since it operates on low pressure.

"PGW has not experienced an incident in which an explosion occurred because a steel service line was struck and pulled from an inside meter set," it said.

Peco estimated it would pay $110 million to relocate 80,000 indoor meters, and UGI Utilities estimated it would pay $209 million to bring its system into compliance.

After further review, the PUC staff will submit the final proposed rule to the five-member commission, which can accept, reject, or modify it.

BY THE NUMBERS

27%

Pa. homes with indoor gas meters

4,000

Gas leaks in Pa. indoor meters

in last five years

$1.6B

Cost to move

indoor meters outside

$138

Cost/year over 10 years to all PGW customers for meter moves

amaykuth@phillynews.com

215-854-2947 @maykuth

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