(November 2008)Economic uncertainties are raising doubts over utility returns. Will regulators feel the need to consider broader economic effects when engaging in ratemaking? While...
Messing With Texas
Armed with calls for gas price transparency, FERC takes aim at intrastate pipelines—the long-forgotten and largely private preserve of the Lone Star State.
flow measurement) devices, or the metering, telemetry, communications, and Internet infrastructure necessary to comply with FERC’s proposal.
The Texas Pipeline Association estimates that the ordinary cost of installing EFM meters to measure gas flow accurately on a 24-inch diameter pipe would run at least $2 million per measurement point:
“Thus, for a pipeline with 20 measurement points, the cost would be at least $40 million.”
Consider, then, that Enbridge reports it has well over 4,000 receipt meters in Texas alone, and estimates that full compliance with FERC’s proposal would cost it more then $32 million on major systems alone. That includes $6 million (at $4,000 per unit) for EFM, plus $18.7 million ($10,000 per unit) for communications devices. (See, Initial Comments, July 11, 2007, p. 11, and Attach. “C”, p. 29.)
Atmos Energy estimates new capital expenses of some $13.2 million, plus a recurring incremental operating cost of $60,000 for all the new equipment.
Copano Energy, intrastate pipeline, says it has approximately 2,150 receipt meters and 125 delivery meters on its pipelines, but that only about half have EFM devises, and only 17 percent have SCADA equipment. And even where it does have EFM and SCADA devices, Copano says, it typically “does not have on-line gas chromatographs due to their cost, which can run from $50,000 to $100,000 per meter site.”