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I N N O V AT I O N S • O C T O B E R -
D E C E M B E R 2 0 1 4
9
A Call To Action: Growing Momentum
Much of the recent infrastructure modernization was inspired by a
call to action by former U.S. Secretary of Transportation Ray LaHood,
who in 2011 encouraged U.S. pipeline operators to identify pipeline
sections that needed to be repaired, rehabilitated or replaced. “We
have a responsibility to work together to prevent the loss of life and
environmental damage that can result from poor pipeline conditions,”
LaHood said at the time.
In 2013, the National Association of Regulatory Utility
Commissions (NARUC) passed a resolution calling for more
infrastructure replacement and cost-recovery programs at the state level.
“State commissions and inspectors are best suited to determine how best
to finance system improvements because each state is different and the
needs and financial circumstances of each utility are unique,” it posits.
While some states already had cost-recovery programs in place, a
variety of new programs have come online since then. In Michigan,
the Public Service Commission established a main-replacement
program rider in 2011, enabling a utility company to recover
incremental capital-related costs associated with pipeline replacement.
In April 2013, the commission approved a similar program for
Detroit, Michigan-based DTE Gas Co.
In May 2013, Indiana lawmakers passed legislation allowing
utilities to submit five-year infrastructure improvement plans to
state regulators for approval. If their plans are approved, utilities
can recover their investment through a tracker on customers’ billing
statements. In July 2014, the Massachusetts governor signed a bill
that creates a protocol for pipeline leaks and includes cost-recovery
programs for pipeline replacement. Lawmakers are also considering
a bill that would establish a revolving loan fund for pipeline repairs
and replacements.
Global Innovation For Safety
Safety-enhancement efforts are building momentum worldwide.
Canada’s Jobs, Growth and Long-Term Prosperity Act recently
provided CAD$15.1 million over two years to enable the National
Energy Board to double pipeline inspections and audits to identify
safety issues.
England’s new regulatory model RIIO — Revenue set to deliver
strong Incentives, Innovations and Outputs — rewards companies for
innovation. Its goals include safer infrastructure.
And, in the United States, Traweek is excited about the cooperative
approach to pipeline safety improvements she’s observing among
commissions, lawmakers and operators.
“No pun intended, but natural gas is hot," she says. "It drives
innovation from research organizations and from equipment and
service providers. That’s when we’re at our best … when there are
multiple stakeholders working together to innovate.”
2004-2014
2014
2013
2011
3.2 MILLION KM
of natural gas
distribution mains &
service pipelines in
place across the U.S.
PE lines in the U.S.
updated at a rate of
ONLY 3 PERCENT
of entire U.S. gas
system still utilizes
cast iron mains
Massachusetts governor signs bill
to increase leak detetcion and
pipeline replacement
NARUC calls for more
infrastructure replacement
and cost-recovery programs at
the state level
Former U.S. secretary call
to action to identify pipeline
needing replacement
in serious pipeline
incidents within the
U.S. by 2012
90%
decrease
48,000
km/yr
in the U.S. have a
cost-recovery program
in place as of mid-2014
50
38
states