RE: Case No. U-17826, Commission s own motion: Gas safety standards

Transcription

1 Alida D. Sandberg Director, Engineering Services One Energy Plaza, WCB 1850 Detroit, Michigan Executive Secretary Michigan Public Service Commission PO Box Lansing, Michigan RE: Case No. U-17826, Commission s own motion: Gas safety standards Dear Madam or Sir: (DTE Gas) is an intrastate natural gas transmission and distribution pipeline operator and an operating subsidiary of DTE Energy, a Detroit-based diversified energy company involved in the development and management of energy-related businesses and services nationwide. DTE Gas serves over 1.2 million customers in Michigan, and is pleased to have the opportunity to submit the following comments relating to the Order and Notice of Hearing (Order) issued by the Commission on February 22, DTE Gas submits the following comments relating to the proposed revisions in Case Number U-17826: 1. Amendment of R , Pipeline safety standards; adoption by reference. DTE Gas supports the editorial amendment of Rule 201(2) as presented in the Order. 2. Amendment of R , Welding procedures. DTE Gas supports the striking of Rule 304(b) as presented in the Order. 3. Amendment of R , Nondestructive testing. DTE Gas supports the amendment of Rule 306(1) referencing 49 C.F.R (d), and the editorial amendment of Rule 306(2), as presented in the Order.

2 Page 2 of Amendment of R , Customer meters and regulators; location. DTE Gas supports the amendment of Rule 308, subdivisions (a), (c), (e), (f), and (g) as presented in the Order: Rule 308. The requirements contained in 49 C.F.R , which is adopted by reference in R , are superseded by all of the following provisions: (a) An operator shall ensure that a customer's meter and regulator installation is located outside the building, or shall include an outside above grade riser, except for unless any of the following apply: (i) A The distribution system that operates at 10 psig or less if and an outside meter set assembly is not practical. (ii) A commercial building, industrial building, or apartment building if an outside meter set assembly is not practical. (iii) Row-type houses or houses where the proximity of adjoining buildings makes outside meter set assemblies impractical. (b).. (c) If an outside meter set assembly or an outside above grade riser is installed, then the above grade piping shall be designed to prevent an external force that is applied to the service line from being transferred to and damaging the inside piping. (d).. (e) An operator shall ensure that a service regulator installed in inside a building is located as near as practical to the point of service line entrance. (f) An operator shall ensure that a meter installed in inside a building is located in a ventilated place not less than 3 feet from a source of ignition or heat that might damage the meter. (g) An operator shall ensure that the upstream regulator in a series is located outside of the a building unless it is located in a separate metering or regulating building. We find, however, that the language proposed for subdivision (b) of Rule 308 would be improved by the retention of the words shall include and we propose the following: Rule 308 (a).. (b) A service line excluded under subrule subdivision (1a) of this rule shall include shall includes an outside above grade riser, if practical. (c) Adoption of R , Galvanized or aluminum pipe prohibited for direct burial or submerged use. DTE Gas supports the revision of Rule 310 as presented in the Order.

3 Page 3 of Amendment of R , Leak test requirements; service lines. DTE Gas supports the revision of Rule 312 as presented in the Order. We suggest, to more clearly differentiate the requirements of Rule 312 from those of Rule 313 (R ) for plastic pipelines, that the title of Rule 312 be revised to Strength test Test requirements; service lines other than plastic. 7. Amendment of R , Strength test requirements; plastic pipelines. DTE Gas supports amendment of Rule 313 as presented in the Order. 8. Amendment of R , Test records. DTE Gas supports the amendment of Rule 314 as presented in the Order. We do not believe the additional requirement for recording the date the test was performed will impose undue burden on pipeline operators. 9. Amendment of R , Leak survey required in addition to requirements in 49 C.F.R (b)(2) Rescission of R , Provisions of 49 C.F.R (b)(2) superseded by leakage survey and repair requirement. DTE Gas supports the amendment of Rule 316 to effectively combine the requirements of Rules 316 and 317 into a single Rule, and the rescission of Rule 317, as presented in the Order. 10. Amendment of R , Filing of operation and maintenance manual with commission required. DTE Gas supports the amendment of title and content of Rule 319 to include the word staff as presented in the Order.

4 Page 4 of Amendment of R , Transmission lines; permanent field repair of leaks. DTE Gas finds the proposed language in the Order to be less clear and more confusing than the current language in Rule 326. We believe the intent of the proposed Rule was to prohibit the use of a welded patch for any type of repair of a transmission pipeline, regardless of whether the defect resulted in a leak due to a corrosion pit or other nonleaking defect. The difficulty appears to that the language in Rule 326 is an exception to what is already an exception in 49 C.F.R (b)(3). DTE Gas proposes, as an alternative to the amendment of Rule 326 proposed in the Order, that Rule 326 be revised to adopt simple and clear language that prohibits the use of a welded patch to repair transmission lines. Our suggested text, added in bold/italicized/underlined text below to the version of Rule 326 contained in the Order, is as follows. R Transmission lines; permanent field repair of leaks. Rule 326. (1) In accordance with the The requirements contained in 49 C.F.R (b)(3), which is adopted by reference in R , are superseded by the requirement that an operator shall not repair a transmission pipeline leak that is due to a corrosion pit or that occurs in a transmission line that is joined by mechanical couplings and that operates at less than 40% of the specified minimum yield strength of the pipeline by use of a welded patch. through any of the following procedures: (a) The methodology set forth in 49 C.F.R (a). (b) The methodology set forth in 49 C.F.R (b)(1). (c) The methodology set forth in 49 C.F.R (b)(2). (2) The requirements of 49 C.F.R (c) are superseded by the requirement that An an operator shall not repair a leak described in subrule (1) of this rule through the use of a fillet welded patch. If the changes proposed by DTE Gas are adopted in Case No. U-17826, the resulting simplified language would be: R Transmission lines; permanent field repair of leaks. Rule 326. The requirements contained in 49 C.F.R (b)(3), which is adopted by reference in R , are superseded by the requirement that an operator shall not repair a transmission pipeline by use of a welded patch. 12. Amendment of R , Caulked bell and spigot joints. DTE Gas supports amendment of Rule 331 as presented in the Order. 13. Amendment of R , Discontinuation of inactive service lines. DTE Gas supports amendment of Rule 332 as presented in the Order.

5 Page 5 of Adoption of NEW R , Master meter systems. DTE Gas objects to proposed Rule 335 and contend that its adoption would result in unnecessary confusion. Accordingly, the Company recommends that the Commission strike Rule 335 in its entirety from any Final Order in Case No. U DTE Gas notes that the definition for master meter system in 49 C.F.R applies only to 49 C.F.R. Part 191 covering notifications and reports. While the term master meter system is used in 49 C.F.R. Part 192 (see , , and ), it is not defined in DTE Gas points out that 49 C.F.R. Part 192 covers design, construction, inspection, and testing of pipeline systems, not Part 191. DTE Gas takes exception to the requirement to offer full-service operation and maintenance agreements to owners of master meter systems. DTE is not in the position to have knowledge of the materials used, the design criteria applied to the original installation, or previous maintenance performed on master meter systems. Further, DTE Gas would contend that operation and maintenance procedures should not apply to any of these master meter systems, or that that current operators like DTE Gas should be liable in any way for the safe operation of these systems. DTE Gas suggests the Commission designate these master meter systems owners to be operators as defined in the Michigan Rules, and require them to develop and implement an operation and maintenance plan of their own. DTE Gas will be pleased to participate in discussions with the commission Staff to pursue the issues of master meter systems and to help craft a clear, fair, and executable rule in a future Case. 15. Adoption of NEW R , Farm taps. DTE Gas objects to the content of Rule 338 as presented in the Order. We believe the definition for farm tap in subdivision (1) is unclear in describing what is or is not considered a farm tap. We cannot discern whether a farm tap is or is not a distribution line not operated as part of a distribution system, or if a farm tap is or is not a distribution line connected to a transmission pipeline not operated as part of a distribution system, or if a farm tap is not operated as part of a distribution system, something else. DTE Gas notes that neither production pipelines nor gathering pipelines may be operated as part of a distribution system, so the proposed language adds descriptive language that does not apply to these pipelines and serves only to add to confusion.

6 Page 6 of 13 DTE Gas notes a similar albeit lesser confusion occurred in late 2015 in Case No. U In that Case, the commission Staff expressed concerns about gas service lines connected directly to gas storage fields, transmission pipelines, regulated and unregulated gathering lines, oil and gas wells, and gas processing facilities. At that time, DTE Gas requested clarification from Staff about the nature of the concerns and the scope and intent of the data collection. DTE Gas was concerned about the volume of data being ordered, particularly since we operate thousands of miles of transmission pipelines with hundreds of service lines attached to them. Staff clarified that the intent of the data collection was to learn the details of service line connections in gas storage fields, along gathering lines, at gas and oil wells, and in gas processing facilities; Staff expressed to DTE Gas their concern was not with service line connections providing odorized distribution-quality gas through facilities already in compliance with the Michigan Gas Safety Standards. On the basis of this dialog, DTE Gas complied with the Order in Case No. U and provided data on 58 locations that fit the criteria in which Staff had an interest. For the reason of not being able to discern exactly what is to be covered in this new Rule, DTE Gas objects to the requirement for developing and submitting annual reports of the status of farm taps connected to our facilities. We do not agree with commission staff that these and other new reporting requirements in Case U will be de minimus, since we have never been required to develop and submit these new annual reports and have no data ourselves as to the potential costs in labor, computing system requirements, report development and submission for doing so. 16. Amendment of R , Sectionalizing block valves. Amendment of R , Inspection and testing of welds. DTE Gas offers no comment to the amendments of Rules 407 and 409 as presented in the Order, since we do not operate Sour Gas pipelines.

7 Page 7 of Amendment of R , Records. DTE Gas supports the amendment of Rule 501 as presented in the Order. We do not believe these requirements for making and retaining records already required by the Federal and State pipeline safety regulations will impose undue burden on pipeline operators. 18. Amendment of R , Reports. DTE Gas does not support the amendment of Rule 502 as presented in the Order. We object to the onerous and burdensome new requirement in subdivision (1)(c) for notification of commission staff of construction of one or more miles of contiguous new or replacement pipeline, excluding the length associated with service lines. Throughout the existence of Rule 502 it has been known as a notification requirement for transmission-related facilities. There has never been a requirement for an operator to provide notification to the commission staff for routine construction of distribution mains and service lines. The arbitrary selection of a one-mile threshold for reporting of any pipeline construction not covered under a Commission Order (proposed subdivision 4) appears not to be based on any scientific rationale, and none has been offered in the Regulatory Assessment. DTE Gas notes that the arbitrary selection of a one-mile pipeline construction project in proposed subdivision (1)(c) of Rule 502, and a similar requirement for notifications of commission staff of any construction, rehabilitation, replacement, modification, upgrade, uprate, or update of a facility costing $1 million proposed under subdivision (1)(a) of Rule 502, are arbitrarily one-tenth of the requirements in 49 C.F.R , which requires notification of projects costing $10 million or more or involving 10 miles of pipeline. DTE Gas believes that the proposed revision of Rule 504 (R ) to include the submission of any written report required to be filed with any federal agency by 49 C.F.R. Part 191 will give the commission staff plenty of notifications of construction projects, including distribution system projects, without being onerous and burdensome to pipeline operators. In the event these additional, onerous and burdensome notification requirements are adopted by the Commission, DTE Gas suggests that the requirements in Rule 502(1)(a) be based on the estimated cost of facility projects. We suggest the following wording. (a) Construction or any planned rehabilitation, replacement, modification, upgrade, uprate, or update of a facility, other than a section of line pipe, that costs an estimated $1 million or more.

8 Page 8 of 13 Finally, DTE Gas notes a probable error in proposed Rule 502(3): (3) As part of the notification required under subrule (1)(d) of this rule, an operator or other person proposing to construct a gas pipeline shall comply with the requirements in subrule (2) upon request. There is no subrule (1)(d) being proposed for Rule 502. We believe the correct reference should be to subrule (1)(c), as follows. (3) As part of the notification required under subrule (1)(c) of this rule, an operator or other person proposing to construct a gas pipeline shall comply with the requirements in subrule (2) upon request. 19. Amendment of R , Reports of incidents; telephonic notice to the commission. DTE Gas does not object to the revision of Rule 503 as presented in the Order. We suggest, however, that since telephonic notice is not typically made to Michigan Public Service Commission, but instead to the MPSC Gas Operations staff, the title of Rule 503 be editorially revised to Reports of incidents; telephonic notice to the commission staff.

9 Page 9 of Amendment of R , Address for written reports. DTE Gas objects to the revision of Rule 504 as presented in the Order. We believe the revision will be administratively burdensome, costly and onerous. We question the utility to the commission staff of some data submitted under 49 C.F.R for distribution systems and under 49 C.F.R for transmission and gathering systems on a region-by-region basis. For example, under the proposed Rule distribution system operators would be required to report the percentage of unaccounted-for gas on a region-by-region basis. Transmission and gathering system operators would be required to report the volumetric throughput on a region-by-region basis. The commission staff has provided no basis for or any explanation for the utility of each of the data points in the annual reports required under either 49 C.F.R or for every region of every operator. DTE Gas also objects to the proposed requirement that supplemental reports be submitted no later than the dates required in 49 C.F.R and 49 C.F.R (e.g., not later than March 15 for the preceding year). DTE Gas currently submits TWO annual reports, one for distribution systems and one for transmission and gathering systems. Under the new requirements proposed in Rule 504(2), DTE Gas will be preparing and submitting eighteen distribution reports (one Company-level plus seventeen regional reports) plus fourteen transmission and gathering reports (one Company-level plus thirteen regional reports). The commission staff has not demonstrated the practical utility of, for DTE Gas alone, thirtytwo separate reports. This vast amount of new reporting was not addressed in the Regulatory Impact Statement covering this Case, and we seriously doubt that all of these new reports, in addition to the reports already required, can be assembled, verified, and transmitted by March 15 each and every year. DTE Gas urges the adoption of a much more reasonable due date for all of these supplemental reports, and suggests April 15 be included in the final Rule. DTE Gas finds the proposal that commission staff shall identify and communicate these (specific) regions for which reports are required by the end of the calendar year for which the reports are being submitted to be totally unacceptable. This late date creates an onerous and burdensome requirement on each operator with more than one geographical, operational, or functional area in their system to wait until commission staff transmits their desired list of regions, then rush to compile multiple sets of data in a similar format to the reports required in 49 C.F.R and 49 C.F.R In order to meet the aggressive first quarter date for submission of all of these new reports, DTE Gas urges that the commission staff be required to identify and communicate the specific regions for which reports will be required not later than December 31 of the calendar year prior to the reporting year.

10 Page 10 of 13 DTE Gas is also troubled by the proposal in Rule 504(2) for these supplemental reports to be submitted in a similar format to the reports required in 49 C.F.R and 49 C.F.R We believe this will result in any number of different formats, developed and submitted by each individual operator. We suggest the commission staff develop and publish an electronic version of each of the required forms for distribution and for transmission and gathering systems and provide them for use by Michigan operators. 21. Amendment of R , Adoption by reference. DTE Gas supports amendment of Rule 601 as presented in the Order. 22. Amendment of R , Names, addresses, and phone numbers of organizations. DTE Gas supports amendment of Rule 602 as presented in the Order. 23. Amendment of R , American petroleum institute standard; adoption by reference. DTE Gas supports amendment of Rule 603 as presented in the Order. Since the referenced edition of API Standard 1104 is incorporated by reference in 49 C.F.R , this standard is also available to operators of regulated pipelines in read-only format through the website of the American Petroleum Institute. Persons representing a pipeline operator may register with API and view the document free of charge. We suggest adding the following sentence to R : Registered and authorized representatives of regulated pipeline operators may also view this edition of API 1104 without charge on the API website at Amendment of R , American society of mechanical engineers standard; adoption by reference. DTE Gas supports amendment of Rule 604 as presented in the Order. 25. Amendment of R , National association of corrosion engineers international standard; adoption by reference. DTE Gas supports amendment of Rule 605 as presented in the Order. Although not included for consideration in the Order, three Rules covering requirements for Sour Gas pipelines cite the older edition of NACE MR0175/ISO Since the proposal to amend Rule 605 would adopt the 2015 edition of NACE MR0175/ISO 15156, DTE Gas points out that an inadvertent conflict would be formed between Rule 605 and Rules 402 (R ), 405 (R ) and 408 (R ).

11 Page 11 of 13 DTE Gas suggests the following three correcting amendments also be considered in Case No. U-17826: R Materials for pipe and components; requirements. In addition to the requirements in 49 C.F.R , which is adopted by reference in R , metallic materials for pipe and other components used to transport sour gas shall meet the requirements in the national association of corrosion engineers international standard NACE MR0175/ISO 15156, , which are adopted by reference in R R Valves; qualification for sour gas service. An operator shall ensure that valves used for sour gas service are qualified for sour gas service in accordance with the national association of corrosion engineers international standard MR0175/ISO 15156, , which is adopted by reference in R R Qualification of welding procedures. In addition to the requirements 49 C.F.R , which is adopted by reference in R , an operator of pipeline facilities used in the transportation of sour gas shall use welding procedures that conform to the welding provisions of the national association of corrosion engineers international standard NACE MR0175/ISO 15156, , which is adopted by reference in R Amendment of R , Pipeline and hazardous materials safety administration standards; adoption by reference. DTE Gas supports in concept the amendment of Rule 606 as presented in the Order, to adopt more recent editions of 49 C.F.R. parts 40, 191, 192, and 199. We suggest that, since the referenced PHMSA standards were updated on October 1, 2017, and we are now well past that date, the proposed wording...or 2016 edition and all final rule changes through October 1, is not needed in the final versions of these citations. We offer that the statements for adoption by reference of 49 C.F.R. parts 40, 191, 192, and 199 need list only the current October 1, 2017 edition of these standards.

12 Page 12 of Citation of Michigan Administrative Code (MAC) R , Rescission. During our review of the proposed Rule revisions and MAC references in Case No. U-17826, DTE Gas noted a typographic numbering error in the Michigan Administrative Rules section number itself, citing R This citation title should be editorially corrected to R in the MAC and wherever else it may appear. We believe this correcting amendment to the MAC will have no practical effect on regulated industry. 28. DTE Gas Proposed Amendment of R , Valve maintenance. Although not proposed for amendment in Case No. U-18726, DTE Gas suggests revision of Rule 329, which currently states: R Valve maintenance; distribution systems. In addition to the requirements contained in 49 C.F.R , which is adopted by reference in R , an operator shall partially operate a valve that may be necessary for the safe operation of a distribution system at intervals of not more than 15 months, but at least each calendar year. DTE Gas and other Michigan distribution pipeline operators have successfully implemented the use of non-metallic (plastic) valves for buried service as these valves have become available from manufacturers. Rule 329 imposes a requirement to partially operate a valve in addition to the requirements in 49 C.F.R to inspect and service these valves on a regular basis. Since non-metallic (plastic) valves are virtually maintenance-free and require no lubrication, there is no servicing required. Further, continued partial operation of non-metallic (plastic) valves year after year can actually become a detriment to the operational reliability of the valve. While we believe there may be value to visit each valve site to check the condition and environment of non-metallic (plastic) valves in accordance with 49 C.F.R , we also believe that Rule 329 goes further than necessary in requiring unnecessary partial operation of non-metallic (plastic) valves. Accordingly, we propose that Rule 329 be amended as follows: R Valve maintenance; distribution systems. In addition to the requirements contained in 49 C.F.R , which is adopted by reference in R , an operator shall partially operate a valve, except a nonmetallic (plastic) valve, that may be necessary for the safe operation of a distribution system at intervals of not more than 15 months, but at least each calendar year.

13 Page 13 of 13 DTE Gas appreciates the opportunity to participate in the revision of Michigan s pipeline safety rules. Sincerely, Alida D. Sandberg