Natural gas pipeline distribution company AGL Resources wants to replace more than 3,320 miles of decades-old plastic pipe because it is starting to wear out prematurely, according to company and industry data.
Georgians could be paying an additional $1.35 a month for the next several years, if the project is approved by the Georgia Public Service Commission. The approximate 1 percent increase would be included in “AGL pass-through” surcharges on a monthly natural gas bill. The GPSC is not expected to rule on the project until early next year.
That surcharge would cover replacing about 756 miles of the older pipe, installed before 1974, to start the project, the company said. The so-called “vintage” pipe has a tendency to crack more frequently compared with other types of newer plastic, according to findings from the gas industry and federal regulators.
“We’ve identified the worst-performing pipe that needs to come out on an accelerated basis,” said David Weaver, AGL’s vice president of regulatory affairs.
AGL said it would cost $275 million to replace the oldest plastic pipe over the next for years. The company has not said how much it could cost to replace the rest of the vintage plastic pipe, which was installed between 1974 and 1983.
“What I would hope would be appropriate is that the commission consider the most pressing [700] miles of this pipe first,” said PSC Commissioner Stan Wise.
Atlanta-based AGL is the nation’s largest natural gas distributor. About 64 percent of its pipelines are plastic and about 11 percent of those pipes were installed in the early 1980s, the company said. About 2 percent of those were installed before 1974.
Customers have been paying AGL $3.13 a month to replace old cast iron and bare steel pipe. The company started replacing the pipe in 1998 after a PSC investigation documented more than 20,000 leaks in Atlanta and the northern suburbs over a two-year period. AGL said all of the cast iron and bare steel pipe will be replaced with new plastic pipe by the end of 2013.
Federal pipeline safety regulators from the Pipeline and Hazardous Materials Safety Administration have been studying the vintage plastic pipe since the late 1990s when some natural gas companies reported a higher rate of leaks.
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