AmeraTex Energy - Consumers could pay to clean up old natural-gas plants

Natural-gas utilities want to change the law to make clear that consumers rather than shareholders can be charged cleanup costs for about 90 abandoned natural-gas plants in the state, according to an amendment that might get tucked into the state budget. Some of the gas plants date to the 1800s, when communities used coal and other fuels to manufacture natural gas for use in lighting. The plants have all shut down, leaving polluted sites that have largely been absorbed by the states major utilities. Some of those utilities, led by Duke Energy, are asking lawmakers to approve an amendment that would expand the companies ability to charge customers for cleaning up the sites. The proposal is one of more than a thousand items that groups are hoping to add to the budget, often with little discussion of the implications. What this amendment does is encourage companies to remediate sites sooner rather than later to the benefit of human health and the environment, and do so in the (least-costly) manner, said Blair Schroeder, a spokesman for Duke, the electricity and gas utility that serves the Cincinnati area. It also aligns state policy with existing environmental and regulatory policy, and will close any gaps between the two.

The legislation covers an issue that Duke is now arguing before the Public Utilities Commission of Ohio. The utility has asked for permission to charge consumers $65.3 million to clean up two gas-plant sites in its territory. The PUCO staff and consumer advocates are saying that Duke should cover nearly all costs with insurance and shareholder money. The issue is part of a larger case that has been pending for nearly a year. Schroeder said the amendment will have no effect on the PUCO case. Columbia Gas of Ohio also supports the amendment, a spokesman for that company said. The Office of the Ohio Consumers Counsel, the states consumer advocate on utility issues, is very concerned about the amendment, said spokesman Marty Berkowitz. The measure would weaken the decades-old law that protects Ohio consumers from higher rates, he said. According to testimony in the PUCO case, there are about 90 abandoned gas plants across the state, including in Columbus, Delaware, Newark, Lancaster and London. The testimony included no information about the addresses, ownership or estimated cleanup costs for locations other than the two owned by Duke. The U.S. Environmental Protection Agency commissioned a report about the plants that was released in 1985. It traces the history of this once-common industry, which had 989 plants across the country in 1890 and still had 194 operating in 1950. In Ohio, there were large plants in Cleveland and Cincinnati and smaller ones in the other cities. The plants left behind waste that might include tar, ammonia, coke and lime, according to the EPA report. The proposed amendment deals with the section of Ohio law that sets the PUCOs ratemaking authority. It says nothing in that code section shall preclude the recovery of environmental remediation costs by a natural gas company or gas company where such costs are prudently incurred prior to January 1, 2025, as long as the property is still being used to provide utility service. As written, the amendment affects only gas utilities, even though other entities, including electric utilities and local governments, might own some of the gas-plant sites.