01 April 2013

Old iron gas pipes are leaking across Michigan; replacement is slow, can be deadly

Crisscrossing Michigan are more than 3,100 miles of old wrought- and cast-iron natural-gas pipelines -- the type federal regulators consider the most at risk of corrosion, cracking and catastrophic rupturing. The state's two largest utilities have replaced less than 15% of these pipelines -- 542 miles -- in the past decade.

Only four other states have more old iron gas mains than Michigan. These pipelines don't just increase the chances of a leak -- they're already leaking.

And the process of replacing them can lead to deadly results. On Feb. 27, as a Consumers Energy work crew replaced pipelines dating to 1929 in a Royal Oak neighborhood, a natural-gas explosion occurred, killing a man, leveling his house and damaging 30 other homes nearby. Consumers later fired an unspecified number of employees for "failure to follow established policies and procedures." Investigations by the utility, the Michigan Public Service Commission (PSC) and the Royal Oak Fire Department continue.

Consumers Energy and DTE Gas, formerly known as MichCon, provide natural gas to 88% of Michigan homes and businesses. The PSC, which regulates the state's utilities, has pressed both to accelerate the replacement of aging pipelines.

The utilities cite the massive costs involved and the accompanying rate hikes consumers might face as the reason for the slow pace, but critics say state and federal regulators need to be more aggressive about ensuring public safety after recent deadly explosions involving old pipes nationwide.

"This aging infrastructure needs to come out of the ground as fast as possible," said Carl Weimer, executive director of the Pipeline Safety Trust, a Bellingham, Wash.-based nonprofit promoting fuel-transportation safety. "They need to do the analysis of where the worst of it is and get the stuff out."

* Related: At $1 million a mile, cost and labor often delay replacement of old pipe

* Graphic: Michigan's 3,153 miles of risky pipeline

* Related: State has just 6 inspectors for 56,000 miles of pipe

Story originally appeared on Freep.

DTE Energy, which provides natural gas to 1.2 million customers in Michigan, has more wrought- and cast-iron pipeline in its system than all but one other utility in the U.S.: New Jersey's Public Service Electric & Gas.

In 2010, the PSC expressed "great concern" about DTE's "ability to provide safe and reliable service" because of its significant amount of aging pipelines and lack of action to replace them. A report noted that DTE Gas had 23.8 gas leaks per 100 miles of main in 2008 -- more than 10 times the 2.3 leaks experienced by Consumers Energy, the state's largest gas utility, with 1.7 million customers.

DTE also had more repairs for leaks from corrosion on its pipelines than Consumers did. In 2010, Consumers had 0.47 such repairs per 100 miles of steel or cast-iron mains. DTE had more than 34 times that -- 17.1 repairs per 100 miles of main, the PSC said.

The danger from aging pipelines made from materials now considered substandard has long been known. The National Transportation Safety Board called for replacement of cast-iron gas mains as far back as 1973.

"Local utilities and state regulators just haven't done much to get them out of the ground," Weimer said.

Slow to change

While declining to explain why more wasn't done to replace aging gas pipelines in the past, DTE Gas' senior vice president of gas operations, Bob Richard, said the problem is being rectified now.

"We've hired 100 people to work 100% on pipeline safety in our distribution system over the last two years," he said.

In 2010, the PSC directed DTE to develop a detailed plan for main replacement, including a long-term plan to significantly reduce the amount of cast-iron mains in its system. But the plan commissioners approved in September 2011 called for remediating about 30 miles of risky pipeline each year over 10 years. That's a total of only 300 miles of the utility's nearly 4,000 miles of unprotected pipeline, which is mostly made up of old cast iron but also includes steel lines without protective coatings or treatments.

Richard said DTE replaced 60 miles of old unprotected gas mains last year and plans to replace another 70 miles this year. But even at an average of 60 miles of pipeline replaced per year, it would take the utility more than 42 years to replace all of its cast-iron pipelines, putting most more than a century in the ground.

Consumers has about 626 miles of cast- and wrought-iron pipeline in its gas system, or about 2.4% of the utility's total distribution system. It has replaced 21% of its wrought- and cast-iron mains since 2004. But Consumers has also come under criticism.

In testimony before commissioners in February 2012, David Chislea, the PSC's manager of gas operations, criticized Consumers' declining progress on pipeline replacement. After utility officials touted a new program in 2010 to replace 25 miles of additional cast-iron pipeline each year, the amount of pipeline Consumers actually replaced decreased from 12 miles in 2010 to 10 miles in 2011, Chislea said.

"If Consumers was committed to this accelerated replacement program, staff would have expected to see some increases in cast-iron replacement in 2011 beyond historic levels, but this was not the case," Chislea told commissioners. A similar drop-off was reported in the utility's replacement of unprotected steel pipelines, he said.

Last year, Consumers replaced 12 miles of cast iron and almost 31 miles of uncoated steel pipeline, company officials said.

The utility's vice president of rates and regulation, Ronn Rasmussen, asked the PSC last month to approve a rate increase allowing the utility to invest up to $70 million more each year over 25 years to replace aging infrastructure. The plan would lead to "the elimination of virtually all of the existing cast-iron main" in Consumers' distribution system, he said.

DTE replaced just 1% of its wrought- and cast-iron gas pipelines from 2009 to 2011, compared to Consumers' 3.6% and a national average of replacement over that period of 5.3%, according to data kept by the federal Pipeline and Hazardous Materials Safety Administration, which regulates pipelines nationwide.

PHMSA, a division of the U.S. Department of Transportation, has wrought- and cast-iron pipeline data going back a decade on 34 states. Michigan ranks 25th among those states in its rate of progress in replacing such pipes from 2004 to last year.

Wrought- and cast-iron pipes are particularly high-risk because of their increased likelihood of corroding or cracking after decades in the ground. Unprotected steel pipes are also considered substandard today. Today's gas-distribution pipes are made of advanced plastics or specially coated steel. Steel pipes are now further protected through a cathodic process that runs an electric current through the pipe and reduces the risk of corrosion.

A deadly threat

A large crack in an 83-year-old, cast-iron gas main caused a Feb. 9, 2011, gas explosion in Allentown, Pa., that killed five and damaged nearly 50 homes. A Pennsylvania Public Utility Commission investigation found a work order to replace the pipeline from December 1979 that wasn't acted upon. The commission in January fined operator UGI Utilities $500,000 and ordered it to replace all of its cast-iron mains within 14 years and its bare steel pipelines within 30 years.

A "substandard and poorly welded" section of 30-inch gas transmission pipeline installed in 1956 was blamed by the National Transportation Safety Board for a leak that caused a Sept. 9, 2010, gas explosion in San Bruno, Calif., that killed eight, injured dozens more and destroyed a neighborhood in the resulting fire. The NTSB found that operator Pacific Gas & Electric's pipeline integrity management was inadequate, as were state and federal utility regulators for failure to notice the insufficient pipeline monitoring.

Weimer said the additional scrutiny after those disasters still hasn't led to getting dangerous pipes out of the ground quickly enough.

Too often, Weimer said, utilities and regulators drag out investigations into natural-gas explosions, releasing findings after public attention has waned. The Michigan Public Service Commission still considers as under investigation a natural-gas explosion at a furniture store in Wayne that killed two employees and injured the store's owner in December 2010.

"To most local governments and citizens, pipelines are out of sight, out of mind -- until something happens like in Royal Oak," he said of the explosion there. "We wish that attention could be focused and sustained in a way that led state utility commissions and Congress to change things in a meaningful way."

More Details: Getting tougher on pipelines

In the wake of three major pipeline disasters within two years -- deadly natural gas explosions in San Bruno, Calif., and Allentown, Pa., as well as a large oil spill after a pipeline failure near Battle Creek -- Congress passed toughened pipeline regulations that President Barack Obama signed into law in January 2012.

The provisions include increased civil penalties on oil, natural gas or hazardous liquid pipeline facility operators for failure to comply with regulations and safety standards. Penalties increased from $100,000 to $200,000 for an individual violation, and from up to $1 million to $2?million for a series.

The bill also called for the secretary of the National Transportation Safety Board, the secretary of transportation and other federal government officials to conduct studies related to a variety of pipeline safety issues and report back to Congress within two years.

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