Kansas utility regulators on Tuesday laid out expectations for increased accountability from three natural gas companies to make plans to replace antiquated, obsolete pipelines in their systems.
In a final 52-page order filed Tuesday, the commission said that Atmos Energy, Black Hills Energy and Kansas Gas Services should develop a plan within three months to replace all bare steel and cast iron gas lines in their systems that are in populated areas.
To support the accelerated replacement of outdated gas lines — which Atmos Energy testified at previous hearings would take 187 years at its current rate of replacement — the three-member Kansas Corporation Commission created an Accelerated Replacement Program.
An ARP would allow the companies to submit a replacement plan to the KCC and to charge up to 40 cents per month per customer to speed replacement.
KCC Chairman Pat Apple said concerns about whether corroded pipelines posed a danger for Kansans was one of the things “that make commissioners stay up at night.” He listed a series of tragic gas explosions nationwide, including the San Bruno pipeline explosion in California, where the state’s regulatory agency was held partly responsible for lack of oversight.
“Going back to what keeps me up at night sometimes, is that I’m sure in every one of these instances, people were told all of these systems are safe,” Apple said. “So we’re dealing with obsolete infrastructure. What is the plan to replace that? Can we wait until it’s 100 years old, 150 years old? Are we safer, are we better off to take a measured approach and start replacing those obsolete pipeline materials? Or do we wait until there’s a tragedy and then we say, ‘Oh, we have a problem that we have to do something about.’ ”
The systems themselves may be the responsibility of the utility companies, he said, but, “the commission does have responsibility to make sure that these things are safe and if there’s an opportunity to make them safer, that that is done.”
KGS, Atmos Energy and Black Hills all said staff was reviewing the final order in depth.
Dawn Tripp, KGS spokeswoman, said the company already has a plan in place to replace its bare steel service lines and cast iron mains by the end of 2024.
Atmos Energy was singled out by KCC in the order for its past lack of focus on replacing obsolete pipe.
“The Commission is unable to reconcile Atmos’ claimed commitment to public safety with the dearth of action taken to remedy its expansive inventory of increasingly leak-prone, obsolete pipe,” the order said.
Such inaction — replacing just 400 service lines per year between 2004 and 2013 — was “especially troubling,” the commission said, given that Atmos testified in previous hearings that nonstandard and obsolete pipes pose long-term threats to the safety and reliability of the distribution system and increase the chance of a catastrophic failure.
Atmos spokesman Aaron Bishop said the company had “maxed out” the funding mechanism in place to replace aging pipeline.
“As of right now, our system is safe. We’re looking to replace a lot of these vintage lines, and it’s our hopes that we’ll be able to do that in a timely manner, which is the reason for the docket,” he said. “We’re confident in the safety of our system.”
The final order Tuesday also ordered the companies to prepare a plan for increased leak detection of the obsolete plastic pipeline in their systems, and to develop an annual lost and unaccounted for gas report.
Although commissioner Shari Feist Albrecht agreed with the necessity of accelerating obsolete pipeline replacement, she disagreed with how the funding mechanism was structured. She wrote an opinion attached to the order dissenting in part.