General Assembly must set natural gas policy, not PSC | READER COMMENTARY
This letter is in regard to The Baltimore Sun’s recent editorial exploring how the Maryland Public Service Commission should be regulating Baltimore Gas and Electric based on the Abell Foundation report, “The Trouble with STRIDE: Meeting climate goals and addressing natural gas system stranded costs” (“As rate decision looms, a new warning about BGE gas plan,” Dec. 12). Reading the report, I find it incomplete, although very well researched. The report recommends that the PSC hold a broad proceeding on natural gas. I completely agree with that recommendation. But the real issue is not with the PSC, it is with our legislators. The PSC’s job is to regulate the utilities, not to shut them down.
To analyze this properly, you have to look at where this is headed. If climate advocates get their way (and they should), households will start shifting to electricity for heating and hot water and replacing gas appliances with electric ones. The transition will be slow — decades most likely unless the state or federal government devotes tens of billions to the process in Maryland. In addition to homeowners, there are tens of thousands of companies that use natural gas. For some of these companies (such as cement plants), there is no alternative to natural gas that is less polluting, so they will still need to have gas service indefinitely.
The Abell report notes that Maryland’s goal is to reduce gas usage by 90% by 2050. So the biggest flaw is assuming that this will mean that the gas distribution network will also need to decrease. The reality is that, while service connections might be reduced somewhat, the majority of the gas pipeline network will still need to exist. A home that eliminates its gas heating system may still have a gas stove or a gas dryer. A warehouse may replace its gas heating system with an electric one but still could have a gas backup. As we stress the electric grid, there will likely be more demand for backup generating capacity.
There are lots of home backup generators that run on natural gas. So by 2050, the odds are that gas consumption may be reduced by 90%, but gas pipelines will likely still be only slightly less than what they are today.
Meanwhile, the biggest greenhouse gas issue with natural gas is not its carbon emissions but leakage. If Maryland wants to reduce climate change, it needs to ensure that BGE aggressively addresses leakage and replaces older pipes proactively so they don’t start leaking. The STRIDE program provides the funds for the utility to do so. The Abell report concludes that there were few “significant incidents” that were reduced by STRIDE funding. That is entirely predictable. Gas pipelines rarely kill or injure people. Most deaths involving natural gas are the result of problems with the equipment and buildings to which they are connected. The proper measure for effectiveness of the STRIDE funding is leakage. That can be calculated by analyzing the amount of gas billed versus the amount of gas distributed. The difference is not well reported, but I suspect BGE has those figures and that they are not pretty.
The third issue is the result if STRIDE is eliminated. That will revert the utility to replacing pipelines only after they fail. With no way to recover investment in gas pipelines, the utility will have no incentive to invest in preventative replacement. That will result in service disruptions for customers and increased leakage. It will also increase operating costs, which will pass on to customers. So this amounts to a failure to compare the cost of eliminating STRIDE to the increased cost to customers by adopting a repair-when-fail model of operating and the associated increase in leakage and greenhouse gas of this approach.
These three issues are the ones your readers need to understand if they want to contact their legislators or the PSC. Maryland should be focused on reducing the use of natural gas. But rather than reducing STRIDE, make it easier and cheaper to switch to electricity. That means eliminating regulatory delays for transmission lines, installing solar on all government buildings and schools, and copying effective measures from other states that are reducing natural gas usage. For regulation of natural gas, state legislators should consider requiring utilities to report the quantity of gas they purchase, the gas quantities billed and the loss rate so that regulators can require measures to reduce the loss rate. And if we want to reduce the amount of gas pipelines in the state so we are not repairing lines that will be soon abandoned, start looking at measures allowing utilities to refuse services that are uneconomic to customers.
These are not PSC issues, but rather changes to legislation. The PSC can assist by posing recommendations to change its foundational purpose to include gradually reducing the gas pipeline network.
— William Hettchen, Ellicott City
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