UGI upgrades will cost, but likely not until after I sell my house
My wife and I are still trying to sell our house in the Scranton area.
As a result, we’ve had to drive a lot up Interstate 81 between my in-laws’ house in Chambersburg to our lovely split-level in the Abington Heights School District.
And, because Jen and I like a change of scenery, we’ve taken a few alternate routes back from the Electric City. Namely, we’ve taken Route 443 from Pine Grove to where it ends at Front Street near Fort Hunter north of Harrisburg.
During that ride, we pass Fort Indiantown Gap and Hollywood Casino. But not far from Swatara State Park, we’ve encountered a lot of large plastic pipe and disturbed earth.
I wasn’t totally sure what it was until Joe Swope, utilities communication manager with UGI Utilities Inc., stopped by our Harrisburg office.
UGI is spending $1.2 billion — $85 million a year — to replace all of its cast iron pipes in 14 years and most of its cast steel pipes within 30 years (the company is going with coated steel pipes in downtown Harrisburg because of nearby steam pipes).
But he also passed along a tidbit that I wasn’t aware of: The new system will increase the amount of pressure the pipes can handle. The old system was about a quarter pound; the new is about 60 pounds.
“We’ll be better able to accommodate growth with a medium-pressure system,” he said.
And there’s another little-known fact: As natural-gas-burning heaters become more efficient, they require a certain constant pressure to maintain that efficiency, Swope said. As the company learned in the recent harsh winters, the quarter-pound lines can’t meet the pressure requirements.
“So, you’d have equipment that kept running and not producing any heat,” he said. “This new system solves those pressure problems.”
So, that’s the happy, fun stuff. What about the cost? You know that’s going to be picked up by the customers.
Yes, that’s the case. It will come. But it could not be here until at least after the middle of next year, and likely it will be later than that, Swope said.
He said the reason is tied to state rules and a settlement with the state Public Utility Commission regarding an explosion in Allentown in 2011.
First, under the settlement, the company is forbidden from requesting what is known as a Distribution System Improvement Charge (a temporary fee state law allows for utilities to recoup major system improvement costs) until April 2015.
Second, under the state law, a utility can’t request a Distribution System Improvement Charge unless it has requested a base rate increase from the PUC within the past five years, Swope said.
The last time UGI asked for a base rate increase was the mid-1990s, he said.
“The utility will file,” Swope said. “But there’s no time frame. And I can tell you it takes a year’s worth of work before you can file something like that. And I can say that we’re not working on it now.”
Plan your budgets accordingly, but you likely won’t have to worry about it until 2016.
In the meantime, are you or someone you know looking to buy a house in northeastern Pennsylvania?