M t f Vi tM t f Vi tManagement of Vintage Distribution Pipelines WorkshopManagement of Vintage Distribution Pipelines Workshop

Distribution Fitness For Service UpdateDistribution Fitness For Service UpdateDistribution Fitness For Service UpdateDistribution Fitness For Service Update

2011 Fall Committee MeetingsFort Worth, Texas2011 Fall Committee MeetingsFort Worth, Texas

Bruce PaskettVictoria PlotkinFort Worth, Texas

September 12, 2011Fort Worth, TexasSeptember 12, 2011

Victoria Plotkin

Agenda• Trends in Pipeline Safety Performance

• The Perfect Storm

• Congressional/Media Perspectives

• DOT Action Plan and Pipeline Safety Forum

• AGA’s Position on Aging Infrastructureg g

• Fitness For Service Summary

f S• Fitness for Service White paper

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Pipeline Incidents w/Death or Major Injury (1986‐2010)

90

100

(1986 2010)

70

80 Long‐term trend (average10% decline every 3 years)

40

50

60

20

30

40

0

10

1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010Calendar YearData:  DOT/PHMSA Pipeline Incident Data (as of Jan. 19, 2011)

And Then…“The Perfect Storm”

• BP Gulf of Mexico oil spill – 4/20/10• Kalamazoo River MI liquid pipeline failure andKalamazoo River MI, liquid pipeline failure and

oil spill – 7/26/10• San Bruno CA NG transmission – 9/9/10• San Bruno CA, NG transmission – 9/9/10• Wayne MI, NG distribution – 12/29/10

Phil d l hi PA NG di t ib ti (CI) 1/19/11• Philadelphia PA, NG distribution (CI) – 1/19/11• Fairport Harbor OH, NG distribution – 1/24/11• Allentown PA, NG distribution (CI) – 2/9/11• Minneapolis MN, NG transmission – 3/17/11

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Congressional/ Media Perspectives

• Loss of public confidence in PL safety, industry,Loss of public confidence in PL safety, industry, DOT, state oversight

• PL safety questioned by Congress DOT statePL safety questioned by Congress, DOT, state regulators, NTSB, others

• Concerns about the “Aging Infrastructure”- Calls• Concerns about the Aging Infrastructure - Calls for all “old pipe” to be replaced

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DOT PL Safety Action Plan April 4, 2011

• DOT announces Pipeline Safety Action Plan-p yAccelerate the rehabilitation, repair and replacement programs for high risk pipelines

• Call to Action-Engage stakeholders to focus on “3Rs” of highest risk infrastructure

• Aggressive Efforts- Raise the bar on pipeline safetyT P bli i l t / d di t d• Transparency- Public involvement w/ dedicated website

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DOT Pipeline Safety Forum 4/18/11 • “Call to Action” – DOT concerned about rising

number of PL incidents & fatalities• Brought stakeholders together to discuss issues

that affect pipeline safety• Focused on repair, rehabilitation and replacement

of lines no longer “fit for service”Focused on replacement of CI bare steel older• Focused on replacement of CI, bare steel, older plastic

• Developing “Report to America”• Developing Report to America• In conjunction with forum, created Pipeline Safety

Awareness website:Awareness website: http://opsweb.phmsa.dot.gov/pipelineforum/

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AGA’s Position on “Aging Infrastructure”

• AGA agrees that there are some pipelines that h ld b l dshould be replaced

• Should not replace pipelines simply based on age-Age alone is not the determining factorAge alone is not the determining factor

• Other factors need to be considered- Condition and performance material manufacturer coating etcperformance, material, manufacturer, coating, etc.

• Focus on “Smart Modernization”• States need rate treatment mechanisms to promote• States need rate treatment mechanisms to promote

accelerated infrastructure replacement

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States with Infrastructure Cost Recovery Rate Treatment Mechanisms (April 2011)

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Determining “Fitness for Service” • AGA created a Distribution “Fitness for Service”

Task Force” to develop guidance for operators• Developed a two page “Distribution Fitness for

Service” summary in late June, submitted to the docket for the “Report to America”

• Draft Report to America incorporated significant portions of the Distribution FFS summary document

• Distribution FFS Task Force currently creating a more comprehensive Distribution Fitness for Service White Paper

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“Fitness for Service” Summary

• Fitness for Service based on the ability of facilities, groups of facilities or components to satisfactorilygroups of facilities or components to satisfactorily perform their intended function

• Age (vintage) is not the key factor Condition and• Age (vintage) is not the key factor- Condition and performance are key drivers

• Facilities or groups of facilities whose performanceFacilities or groups of facilities whose performance significantly deteriorates may no longer be considered “FFS” and should be considered for “Smart Modernization”

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“Fitness for Service” Summary

• Smart Modernization is “The targeted, risk-based rehabilitation or replacement of specific facilities orrehabilitation or replacement of specific facilities or groups of facilities based on the condition and performance of those facilities”performance of those facilities

• DIMP provides a regulatory structure for operators to evaluate safety performance of “facilities or groups of y p g pfacilities”

• Broad mandates to rehabilitate or replace a vintage or type of distribution material may be counter-productive to PL safety because it is not risk-based

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“Fitness for Service”

Update on the Fitness forUpdate on the Fitness for Service White Paper

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White Paper Overview

• What is Distribution Fitness for Service? What does this mean to operators, regulators and the public?

• What have operators done historically to address Distribution p yFFS?

• What is the current state of the industry with respect to Distribution FFS?

• What key information (or potential threats to pipeline safety) that is taken into account when operators are assessing their distribution systems?

• How does DIMP and the initiatives that operators are implementing as a result of this performance-based rule address Distribution FFS? What are operators planning to do to continue to ensure Distribution FFS?continue to ensure Distribution FFS?

• Intended audience: DOT staff, NTSB staff, Congressional staff

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Companies that contributed

• AGL Resources Inc.• Atmos Energy Corporation• Baltimore Gas and Electric• CenterPoint EnergyCenterPoint Energy• City of Richmond, Department of Public Utilities• Consolidated Edison Company of New York, Inc.• Consumers Energy• Dominion East Ohio • Dominion East Ohio • DTE Energy - MichCon• Duke Energy Corporation• Integrys Energy Group

N ti l G id• National Grid• New Jersey Natural Gas Company• NiSource Corporate Services• NW Natural• Pacific Gas and Electric Company• Public Service Electric and Gas Company• South Jersey Gas Company• Southern California Gas Company

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White Paper Structure

• Executive Summary• Overview of Development of Distribution Systems• Distribution Pipeline Design, Construction and MaintenanceDistribution Pipeline Design, Construction and Maintenance• Performance Metrics• Improving system reliability and pipeline safety• DIMP• DIMP• Conclusion/Summary

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General Concepts Captured

• Distribution piping systems were developed over the past century, and the materials and installation methods used reflect the information and technology available at the time

• Distribution piping systems are comprised of various material types operating at various pressures, reflecting the unique operating conditions each operator is addressing

• Distribution operators continually maintain, monitor and assess system performance to ensure safe pipeline operations

• Operators adhere to Federal and State regulatory requirements th t t f d li bl ti f th i tthat promote safe and reliable operation of their gas systems

• Operators utilize damage prevention programs, extensive leak management processes and “smart modernization” to promote safe and reliable operationssafe and reliable operations

• Incident and leak data from the last 19 years shows industry is driving incident and leak data down

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Significant & Serious Incidents

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Reduced Damages Since 1999

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Reduced Main Leaks

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Reduced Service Leaks

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Closing Comments

• DIMP formalizes data gathering, analysis, risk ranking and mitigation activities associated with fitness for service that operators already have in place

• Effective leak management is key to Distribution FFS• Pipeline material and age are only two of many factors that

must be considered when assessing pipeline safety• Requiring large-scale replacement programs for industry based

on a limited pipeline safety assessment is fiscally impractical and doesn’t necessarily improve pipeline safety and/or

li bilitreliability• Future DIMP goals?• Official review by Operating Section

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Questions?Questions?