Baltimore Gas and Electric Co. will be accelerating its replacement program for its aging gas infrastructure over the next half-decade, but not as much as the company originally wanted to, according to a Maryland Public Service Commission order issued May 30.
The Maryland PSC said its decision to approve BGE's spending request helps ensure public safety by expediting the utility's pace for removing "obsolete" gas distribution infrastructure. About a third of BGE's gas mains and services are more than 50 years old.
BGE ultimately wants to replace all of its 1,216 miles of cast iron main, 22 miles of bare steel main, 844 miles of bare steel services, 238 miles of copper service pipes, and 446 miles of pre-1970 three-quarter-inch high-pressure steel service lines.
While these five categories represented about 20% of the company's total distribution system mileage at the end of 2016, they contributed to 70% of all the gas leaks the company reported that year.
The Maryland PSC staff said the pre-1970 lines should be the top priority because 48% of the gas service leaks in recent years have been from this pipe type, even though these pipes represent only 7% of all gas services on BGE's system.
The company wanted to accelerate its infrastructure replacement from the current pace of 48 miles per year to 70 miles per year, but the Maryland PSC said BGE should stick with the 48-mile-per-year rate except for the high-pressure steel service lines. The company should strive to completely replace that category of infrastructure by 2021, the commission said.
Shareholders would benefit more than customers under BGE's proposal to accelerate replacement on other categories of materials, the commission staff said in explaining their recommendation not to allow the company to accelerate all categories of infrastructure replacement. The company and its investors could see up to $75 million in additional revenue from the proposed acceleration, staff wrote.
The recently approved investment represents a second iteration of the company's Strategic Infrastructure Development and Enhancement, or STRIDE, plan, which has experienced some scheduling obstacles and cost overruns.
By the end of the first phase, slated to come to a close at the end of 2018, the company is expected to have spent $523 million — $73.7 million more than planned — on replacing 172 miles of pipe, which would be 80% of the 213 miles proposed to be replaced under the original project proposal.
BGE has 30 days from the order date to notify the PSC whether the company accepts the order on the second phase of the STRIDE program. The commission also asked BGE to provide more detailed information on the cost of replacing services and mains.
