LDCs Continue To Upgrade Gas Network

Local distribution companies (LDC) remain the backbone of the nation’s natural gas distribution network. Natural gas utilities serve more than 71 million residential, commercial and industrial customers across the nation. Gas is delivered through a 2.4-million mile underground delivery system with an outstanding safety record.

The distribution network also includes measurement and pressure regulators, corrosion control equipment and valves and meters, all of which must be operated, maintained and upgraded by the local natural gas utility.

The more than 1,200 local natural gas utilities in the United States spend billions of dollars per year on safety programs to ensure the safety and reliability of the many miles of mains and service pipelines that are made up of steel, cast iron or copper, which are subject to corrosion.

Cast iron pipe, which exhibits brittle characteristics and is subject to cracking and breakage, sometimes as a result of ground movement in proximity to buried pipe, has been on the decline since the mid-1980s.

According to a recent American Gas Association (AGA) study, there has been a 46 percent decrease in the amount of cast iron main since 1985 and today, only 3 percent of the entire national gas distribution system is composed of cast iron mains. That figure that is continuously being reduced as pipeline operators implement accelerated pipeline replacement programs.

Also, the study stated that serious incidents involving cast iron mains have also declined – dropping by a difference of 86 percent between 1985 and 2012.

The LDC employs many techniques to reduce steel corrosion, including various pipe coatings and the replacement of leak-prone mains and service lines with medium- and high-density polyethylene (PE) plastic pipe that is the current industry standard for most distribution pipe sizes.

In the past decade, natural gas utilities have installed updated plastic lines at a rate of 30,000 miles per year, connecting new customers or replacing older pipeline infrastructure. Today, there are nearly 1.3 million miles of plastic pipe in the natural gas system, along with more than 1.1 million miles of cathodically-protected steel pipeline.

Moreover, while LDCs have made significant advances in modernizing pipeline infrastructure over the last two decades, industry estimates indicate it may easily take another three decades of effort to finish the job at the current pace of replacement.

The National Association of Corrosion Engineers (NACE) estimates the direct cost of corrosion for the natural gas distribution industry to be $5 billion annually.

Pipe replacement, upgrades

Natural gas utilities spend $7 billion annually on their gas pipeline pipeline systems. Atmos Energy Corporation, one of the nation’s largest natural gas distributors, has invested more than $1.2 billion over the past three years to safeguard the communities it serves. In addition, the company was expected to spend more than $500 million on safety and reliability by the end of fiscal 2013.

In addition to modernizing its pipeline system, Atmos Energy maintains and monitors more than 72,000 miles of pipeline in eight states. For both its distribution and transmission pipelines, it has detailed integrity management programs that require periodic inspections and testing of its lines and equipment. Atmos Energy technicians monitor the company’s pipelines through aerial surveys, foot patrols and by using specially equipped vehicles to detect natural gas. Atmos has pipeline control centers in Dallas, TX, and Franklin, TN, that rely on advanced telecommunications technology, flow sensors and remote-control valves to control the system and protect the public.

Xcel Energy announced pipeline construction replacement projects earlier this year. The company’s work in Fort Collins and Loveland, CO, involved the replacement of approximately 16 miles of natural gas pipeline to improve service reliability and help Xcel continue to safely maintain its natural gas systems in Northern Colorado. The project is part of a multi-year program, with total investment of $140 million, in which Xcel Energy is installing or replacing approximately 77 miles of natural gas transmission pipeline in Larimer, Weld and Boulder counties. The project will include some distribution pipeline work and is expected to be completed by the end of 2016.

Moreover, while LDCs have made significant advances in modernizing and upgrading pipeline infrastructure over the last two decades, industry estimates indicate it may easily take another three decades of effort to finish the job at the current pace of replacement.

Gas Prices, consumption

The federal Energy Information Administration’s (EIA) expects the Henry Hub price for natural gas will increase from an average of $2.75 per MMBtu in 2012 to $3.68 per MMBtu in 2013 and $3.84 per MMBtu in 2014.

As to consumption, the EIA expects that natural gas consumption, which averaged 69.7 Bcf/d in 2012, will average 70.0 Bcf/d and 69.4 Bcf/d in 2013 and 2014, respectively. Colder winter temperatures in 2013 and 2014 (compared with the record-warm temperatures in 2012) are expected to increase the amount of natural gas used for residential and commercial space heating. However, the projected year-over-year increases in natural gas prices contribute to declines in natural gas used for electric power generation from 25.0 Bcf/d in 2012 to 22.1 Bcf/d in 2013 and 21.6 Bcf/d in 2014.

LDCs rely on a host of safety systems, including supervisory control and data acquisition (SCADA) systems, to ensure efficient and effective service at all times. These systems can integrate gas flow control and measurement with other accounting, billing and contract systems to provide a comprehensive measurement and control system for the local gas utility. This allows accurate, timely information on the status of the distribution network to be used by the utility, to ensure efficient and effective service at all times.

The LDC also relies on sophisticated leak detection equipment and odorants to make it easier to detect a leak.

Certainly the nationwide “call-before-you-dig” phone number of “811” (adopted in 2008) has proved to be an essential tool by providing customers, contractors and excavators with a single phone number to call before beginning excavation or construction, to ensure that pipelines and other buried facilities are not damaged.

These are but a few of the safety measures maintained by local distribution companies.

Continued efforts to upgrade and modernize the natural gas pipeline network show a declining trend for natural gas emissions. According to EPA data, less than 1.5 percent of natural gas is emitted as it travels from where it is produced to homes and businesses. Of that, only 0.3 percent is emitted from systems operated by local natural gas utilities. Distribution system emissions have reportedly dropped 16 percent since 1990, even as the industry added nearly 300,000 miles of distribution mains to serve 17 million more customers – an increase of 30 percent in both cases.

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