ENERGY AND ENVIRONMENT CABINET
Public Service Commission
807 KAR 5:026. Gas service; gathering systems.
RELATES TO: KRS Chapter 278
STATUTORY AUTHORITY: KRS 278.040(3), 278.485
NECESSITY, FUNCTION, AND CONFORMITY: KRS 278.040(3) provides that the commission may adopt, in keeping with KRS Chapter 13A, reasonable administrative regulations to implement the provisions of KRS Chapter 278. KRS 278.485(1) provides that gas service shall be furnished at rates and charges determined by the commission. KRS 278.485(3) provides that safety standards for installation of service lines may be prescribed by the commission. This administrative regulation applies to service from natural gas gathering pipeline systems.
Section 1. Definitions. For purposes of this administrative regulation:
(1) "Average volumetric rate" means the rate of a local gas distribution utility subject to rate regulation by the commission which is an average of the utility's volumetric retail gas sales rates for residential customers as authorized by the commission.
(2) "Customer line" means all equipment and material required to transfer natural gas from the tap on the gathering line to the customer's premises and includes the saddle or tapping tee, the first service shutoff valve, the meter, and the service regulator, if one is required.
(3) "Customer meter" means the device that measures the transfer of gas from the pipeline company to the consumer.
(4) "Gas company" means the owner of any producing gas well or gathering line.
(5) "Gathering line" means any pipe which carries uncompressed gas and which is used to gather gas from a producing gas well.
(6) "Interior line" means pipe used to transfer natural gas from the point of entry into a building to the point or points of use.
(7) "Price index" means the average of the producer price index-utility natural gas (PPI 05-5) for the most recent twelve (12) month period as published monthly by the United States Department of Labor, Bureau of Labor Statistics.
Section 2. Construction Standards. Construction not specifically addressed by this administrative regulation shall meet applicable requirements of the "American National Standard Code for Pressure Piping, Gas Transmission and Distribution Piping Systems (ASME B31.8)" 1992 edition as published by the American Society of Mechanical Engineers, United Engineering Center, 345 East 47th Street, New York, N. Y. 10017, which is incorporated by this reference. Copies are available for public inspection and copying, subject to copyright law, Monday through Friday, holidays excepted, from 8 a.m. to 4:30 p.m., at the commission office, 211 Sower Boulevard, P.O. Box 615, Frankfort, Kentucky 40602.
Section 3. Requirements for Service. (1) Persons desiring gas service under KRS 278.485 shall apply at the local gas company office. Applications shall contain:
(a) The name and address of the applicant.
(b) The purpose for which gas is requested.
(c) The name and address of the contractor who will install the customer line.
(d) The name and address of the gas company from which service is requested.
(2) The gas company shall furnish the applicant with construction drawings specifying the installation methods and the materials approved by the commission for service installation.
(3) Prior to providing service, the gas company shall furnish a copy of the application to the commission.
(4) Upon receipt of a copy of the application, the commission shall cause the customer line to be inspected for compliance with commission specifications. Service shall not commence until commission specifications have been met.
(5) The commission shall notify the applicant by mail if the customer line does not comply with commission specifications. If subsequent inspection reveals that defects have not been corrected, the commission shall notify the gas company, and the gas company shall take no further action on the application until the defects have been corrected.
(6) The gas company shall furnish, install, and maintain the meter and the service tap, including saddle and first service shutoff valve, which shall remain its property. The gas company shall ensure that its name appears on each of its meters.
(7) All other approved equipment and material required for the service shall be furnished, installed, and maintained by the customer at his expense and shall remain his property.
(8) If leaks or other hazardous conditions are detected in the customer line, the gas company shall discontinue service until the hazardous conditions have been remedied.
Section 4. Connections to High Pressure Gathering Lines. (1) Connections shall be smaller than the diameter of the gathering line.
(2) Connections shall be on the upper one-half (1/2) of the gathering line surface, and at a forty-five (45) degree angle where practicable.
(3) Connections shall be at right angles to the center line of the gathering line.
(4) A service shutoff valve shall immediately follow the connection to the gathering line.
(5) A drip tank shall be installed preceding regulating equipment, but may be omitted upon prior approval of the commission.
Section 5. Control and Limitation of Gas
Pressure. (1) If maximum gas pressure on the gathering line may exceed sixty
(60) psig, a service regulator shall be installed between the service shutoff
valve and the customer meter, and a secondary regulator shall be installed
between the service regulator and the customer meter. Regulators shall be
spring type, and the service[
secondary] regulator shall not be
set to maintain pressure higher than sixty (60) psig. A spring type relief
valve shall be installed to limit pressure on the inlet of the service
regulator to sixty (60) psig or less.
(2) Every customer line shall be equipped with an adequate spring type relief valve. The valve may be part of the final stage regulator.
(3) Regulators shall not be bypassed.
(4) Each relief valve shall be vented into outside air, and all vents shall be covered to prevent water and insects from entering.
(5) All metering and regulating equipment shall be as near to the gathering line as practicable, in accordance with safe and accepted operating practices.
(6) Regulating equipment shall be properly protected by the customer.
Section 6. Customer Lines and Metering Facilities. (1) The customer shall furnish and install the customer line from the tap to the point of use. The customer shall secure all rights-of-way and railroad, highway, and other crossing permits. The customer line shall be laid on undisturbed or well compacted soil in a separate trench, avoiding all structures and hazardous locations. No structure shall be erected over the line.
(2) No branch tee or other connection shall be installed on the line to serve any user other than the customer without prior written consent of the gas company and the customer. If consent is given, service to each user shall have an automatic shutoff valve with manual reset located on the riser in a horizontal position. The shutoff valve shall have maximum operating pressure of eight (8) ounces PSIG with a shutoff pressure setting of not less than two (2) ounces.
(3) Customer lines shall not be constructed nearer than thirty-six (36) inches to any subsurface structure.
(4) Customer lines, including the connection to the main, where feasible, shall be checked for leaks by the gas company prior to first use. If it is not feasible to test the connection to the main before first use, it shall be tested for leaks at the operating pressure when placed into service. Customer lines shall be tested by the gas company with air, natural gas, or inert gas at fifty (50) psig for at least thirty (30) continuous minutes.
(5) Customer lines shall be purged after testing to remove any accumulated air.
(6) Metering pressure shall not exceed eight (8) ounces or .5 psig, unless otherwise approved in advance by the commission.
(7) Steel customer lines shall be
constructed of black finish steel pipe, shall have a diameter determined by
the maximum hourly load for the gas service,[
at least one and one
quarter (1 1/4) inches in diameter or larger, that] and shall conform[ conforms]
to standards in the Standard Specification for Pipe, Steel, Black, and
Hot-dipped, Zinc Coated, Welded and Seamless (A53-95a) 1995, as published by
the American Society for Testing and Materials, 100 Barr Harbor Drive, West Conshohocken,
Pennsylvania 19428 which is incorporated by reference. Copies are available for
public inspection and copying, subject to copyright law, Monday through Friday,
holidays excepted, from 8:30 a.m. to 4:30 p.m., at the commission's offices,
211 Sower Boulevard, P.O. Box 615, Frankfort, Kentucky 40602. All joints and
fittings shall be coated or taped, in accordance with manufacturer's
recommendations, from the gas meter to the outlet side of the stopcock located
on the riser entering the building. Steel customer lines shall be installed
with at least twelve (12) inches of cover on private property and at least
eighteen (18) inches of cover on streets and roads. If the steel customer line
passes through tillable land, the trench shall be of sufficient depth to permit
twenty-four (24) inches of backfill above the service line.
(8) Each steel customer line shall have two (2) insulating joints, one (1) between the secondary regulator and the customer meter, and one (1) at the point of entry into the building.
(9) Plastic customer lines shall have
a diameter determined by the maximum hourly load for the gas service[
of one and one-quarter (1 1/4) pipe that] and shall meet[ meets]
the Standard Specification for Thermoplastic Gas Pressure Pipe, Tubing and
Fittings (D 2513-94a), 1994 edition, as published by the American Society for
Testing and Materials, 1916 Race Street, Philadelphia, Pennsylvania, 19103,
which is incorporated by this reference. Copies are available for public
inspection and copying, subject to copyright law, Monday through Friday,
holidays excepted, from 8:30 a.m. to 4:30 p.m., at the commission's offices,
211 Sower Boulevard, P.O. Box 615, Frankfort, Kentucky 40602. Plastic customer
lines shall be installed with at least twelve (12) inches of cover on private
property and at least eighteen (18) inches of cover on streets and roads. When
passing through tillable land, the plastic customer line shall be installed
with at least twenty-four (24) inches of cover. Plastic customer lines shall be
buried with an electrically conductive wire to enable inspectors to locate the
plastic line. All joints in plastic lines shall be made by persons operator-qualified
in accordance with 49 C.F.R. Part 192[ under 807 KAR 5:022, Section
6(8),] to make[ join] plastic pipe joints. No plastic
line shall be installed above ground.
(10) Customer lines shall enter the building above ground level, and a stopcock valve shall be located on the riser.
(11) Each customer's service shall have an automatic shutoff valve with manual reset to stop gas flow if gas pressure fails. The valve may be part of the final stage regulator and shall have operating pressure of eight (8) ounces with shutoff pressure setting of not less than two (2) ounces.
Section 7. Failure to Pay Bills or Other Default. (1) Customers shall be required to pay the installation charge and to pay for all gas delivered at rates approved by the commission. The gas company shall render statements to the customer at regular monthly or bimonthly intervals. Statements shall be rendered within ten (10) days following each billing period. Service shall not be discontinued to any customer for nonpayment of charges unless the gas company has first made a reasonable effort to obtain payment from the customer. The customer shall be given at least forty-eight (48) hours' written notice of termination, but no termination of service shall be made until at least fifteen (15) days after the original bill has been mailed. Service shall not be reestablished until the customer has paid the gas company all amounts due for gas delivered plus a turn-on charge of twenty-five (25) dollars, and has complied fully with applicable service administrative regulations. If the customer has not paid amounts owed, or if the customer has not complied with commission administrative regulations within thirty (30) days from the date the gas is turned off, the gas company may disconnect the customer line from its gathering line. Service shall not be reestablished until the customer has complied with provisions of this administrative regulation pertaining to initial service.
(2) The gas company may require a cash deposit or other guaranty from the customer to secure payment of bills.
Section 8. General Provisions. The gas company shall have reasonable access to the customer's premises, and may shut off gas and remove its property from the premises upon reasonable notice for any of the following reasons:
(1) Need for repairs;
(3) Failure to make a cash deposit, if required;
(4) Any violation of this administrative regulation;
(5) Customer's removal from premises;
(6) Tampering with the meter, regulators, or connections;
(7) Shortage of gas or reasons of safety;
(8) Theft of gas;
(9) Any action by a customer to secure gas through his meter for purposes other than those for which it was requested, or for any other party without written consent of the gas company; or
(10) False representation with respect to ownership of property to which service is furnished.
Section 9. Rates and Charges. (1) Rates. Each gas company shall charge rates filed with and approved by, the commission. A gas company may request an adjustment in its rates to reflect changes in its costs to provide service pursuant to KRS 278.485.
(a) A gas company which provides service pursuant to KRS 278.485 may request an adjustment in rates through a proposed tariff submitted at least sixty (60) days prior to its proposed effective date if:
1. The percentage change in rates does not exceed the percentage change in the price index during the most recent twelve (12) month period immediately preceding the date the proposed tariff is filed; and
2. The proposed rate does not exceed the highest average volumetric rate of a local gas distribution utility approved by the commission and in effect on the date the proposed tariff is filed. The commission shall provide the current percentage change in the price index and the highest prevailing rate upon written request.
(b) If the proposed percentage increase in rates exceeds the percentage change in the price index but the proposed rate remains below the highest prevailing gas rate approved by the commission, the gas company shall submit, with its proposed tariff, cost data which support the proposed increase. The data shall include the gas company's costs to provide the service during each of the previous two (2) years and shall be current within ninety (90) days of the date the proposed tariff is filed.
(c) A proposed tariff increasing rates shall not be filed with a proposed effective date less than one (1) year later than the last commission approved increase. Once the commission has determined that sufficient information has been filed with the proposed tariff, the commission shall either approve or deny the proposed adjustment within sixty (60) days. The commission may suspend the proposed tariff beyond the sixty (60) day review period.
(d) A gas company which files a proposed tariff to increase rates shall mail notice to its customers no later than twenty (20) days prior to the filing date of the proposed tariff. The notice shall be dated, shall state the proposed rate and the estimated amount of monthly increase per customer, and shall state that any customer may file comments or a request to intervene by mail to the Public Service Commission, 211 Sower Boulevard, P.O. Box 615, Frankfort, Kentucky 40602.
(e) In lieu of a rate adjustment through a proposed tariff, a gas company may file an application with the commission for authority to adjust rates pursuant to 807 KAR 5:001, Section 10. If eligible, the gas company may file under the alternative rate adjustment procedure, 807 KAR 5:076.
(a) Any nonrecurring, customer-specific charge, such as those listed in 807 KAR 5:006, Section 8, that is assessed by the gas company shall be listed in its tariff. These charges may be adjusted by filing a proposed tariff with the commission at least thirty (30) days prior to the effective date of the adjustment.
(b) Each gas company may charge $150 for each service tap, including saddle and first shutoff valve which, under this administrative regulation, it must furnish and install.
(3) Provisions contained in this administrative regulation shall apply only to connections made and services provided pursuant to KRS 278.485 after the effective date of this administrative regulation.
(4) In providing notice as required by Section 9(1)(d) of this administrative regulation, the gas company shall use the following form:
NOTICE OF PROPOSED RATE CHANGE
(Name of gas company) has filed a request with the Public Service Commission to increase its rates. The rates contained in this notice are the rates proposed by (name of gas company). However, the Public Service Commission may order rates to be charged that differ from the rates in this notice. Any corporation, association, body politic, or person may file written comments or a written request for intervention within thirty (30) days of the date of this notice with the Public Service Commission, 211 Sower Boulevard, P.O. Box 615, Frankfort, Kentucky 40602. Copies of the request for an increase in rates may be obtained by contacting the gas company at (address of gas company). A copy of the request for an increase in rates is available for public inspection at this address.
Estimated Monthly Increase Per Customer
Section 10. Deviation from Rules. In special cases for good cause shown the commission may permit deviations from these rules.
This is to certify that the Public Service Commission Chairman has reviewed and recommended this administrative regulation prior to its adoption, as required by KRS 278.040(3).
GWEN PINSON, Executive Director
MICHAEL J. SCHMITT, Chairman
APPROVED BY AGENCY: November 28, 2017
FILED WITH LRC: November 29, 2017 at 11 a.m.
PUBLIC HEARING AND PUBLIC COMMENT PERIOD: A public hearing on this administrative regulation shall be held on January 24, 2018, at 2:00 p.m. Eastern Standard Time at the Kentucky Public Service Commission, 211 Sower Boulevard, Frankfort, Kentucky 40601. Individuals interested in being heard at this hearing shall notify this agency in writing by five workdays prior to the hearing, of their intent to attend. If no notification of intent to attend the hearing is received by that date, the hearing may be canceled. This hearing is open to the public. Any person who wishes to be heard will be given an opportunity to comment on the proposed administrative regulation. A transcript of the public hearing will not be made unless a written request for a transcript is made. If you do not wish to be heard at the public hearing, you may submit written comments on the proposed administrative regulation. Written comments shall be accepted through January 31, 2018. Send written notification of intent to be heard at the public hearing or written comments on the proposed administrative regulation to the contact person.
CONTACT PERSON: John Park, Staff Attorney, Kentucky Public Service Commission, 211 Sower Boulevard, Frankfort, Kentucky 40601, phone (502) 564-3940, fax (502) 564-7279, email firstname.lastname@example.org.
REGULATORY IMPACT ANALYSIS AND TIERING STATEMENT
Contact Persons: Jason Whisman, phone 502-564-3940, email Jason.Whisman@ky.gov
(1) Provide a brief summary of:
(a) What this administrative regulation does: Sets service and safety standards for natural gas gathering systems.
(b) The necessity of this administrative regulation: To ensure safe, reliable natural gas services are delivered from gathering systems to consumers and/or transmission points.
(c) How this administrative regulation conforms to the content of the authorizing statutes: 807 KAR 5:026 conforms to KRS 278.040 which requires the Public Service Commission to set regulations for safe and reliable gathering and transmission of natural gas.
(d) How this administrative regulation currently assists or will assist in the effective administration of the statutes: Sets service and safety standards for natural gas gathering systems.
(2) If this is an amendment to an existing administrative regulation, provide a brief summary of:
(a) How the amendment will change this existing administrative regulation: Changes the engineering specifications of piping to conform with current industry standards.
(b) The necessity of the amendment to this administrative regulation: Changes the engineering specifications of piping to conform with current industry standards.
(c) How the amendment conforms to the content of the authorizing statutes: It sets practical and updated safety standards in the construction of gas lines.
(d) How the amendment will assist in the effective administration of the statutes: Changes the engineering specifications of piping to conform with current industry standards.
(3) List the type and number of individuals, businesses, organizations, or state and local governments affected by this administrative regulation: 15-20 regulated natural gas gathering operators within Kentucky.
(4) Provide an analysis of how the entities identified in question (3) will be impacted by either the implementation of this administrative regulation, if new, or by the change, if it is an amendment, including:
(a) List the actions that each of the regulated entities identified in question (3) will have to take to comply with this administrative regulation or amendment: None. Already in practice within the industry.
(b) In complying with this administrative regulation or amendment, how much will it cost each of the entities identified in question (3): Zero Dollars; no fiscal impact.
(c) As a result of compliance, what benefits will accrue to the entities identified in question (3): It modifies state regulation to eliminate outdated standards; therefore, providing clarity for the regulated entities.
(5) Provide an estimate of how much it will cost the administrative body to implement this administrative regulation:
(a) Initially: Zero dollars; no fiscal impact.
(b) On a continuing basis: Zero dollars; no fiscal impact.
(6) What is the source of the funding to be used for the implementation and enforcement of this administrative regulation: Annual assessments paid by regulated utilities, pursuant to KRS 278.130, which are deposited into a special fund within the General Fund per KRS 278.150(3) for the purposes of maintaining the commission.
(7) Provide an assessment of whether an increase in fees or funding will be necessary to implement this administrative regulation, if new, or by the change if it is an amendment: No fiscal impact.
(8) State whether or not this administrative regulation established any fees or directly or indirectly increased any fees: No new fees are established and existing fees will not be affected.
(9) TIERING: Is tiering applied? Tiering is not applied as all utilities must conform with uniform standards of fair, safe, reasonable, and reliable utility services.
FISCAL NOTE ON STATE OR LOCAL GOVERNMENT
(1) What units, parts or divisions of state or local government (including cities, counties, fire departments, or school districts) will be impacted by this administrative regulation? No impact other than reducing the managerial audit findings of regulated gas utility companies by the Kentucky Public Service Commission.
(2) Identify each state or federal statute or federal regulation that requires or authorizes the action taken by the administrative regulation. KRS 278.040
(3) Estimate the effect of this administrative regulation on the expenditures and revenues of a state or local government agency (including cities, counties, fire departments, or school districts) for the first full year the administrative regulation is to be in effect. Zero dollars; no fiscal impact.
(a) How much revenue will this administrative regulation generate for the state or local government (including cities, counties, fire departments, or school districts) for the first year? Zero dollars; no fiscal impact.
(b) How much revenue will this administrative regulation generate for the state or local government (including cities, counties, fire departments, or school districts) for subsequent years? Zero Dollars; no fiscal impact.
(c) How much will it cost to administer this program for the first year? Zero dollars; no fiscal impact.
(d) How much will it cost to administer this program for subsequent years? Zero dollars; no fiscal impact.
Note: If specific dollar estimates cannot be determined, provide a brief narrative to explain the fiscal impact of the administrative regulation.
FEDERAL MANDATE ANALYSIS COMPARISON
(1) Federal statute or regulation constituting the federal mandate. 49 C.F.R. Part 192
(2) State compliance standards. Reduce state standards to mirror federal standards.
(3) Minimum or uniform standards contained in the federal mandate. Uniform standards
(4) Will this administrative regulation impose stricter requirements, or additional or different responsibilities or requirements, than those required by the federal mandate? It will reduce stricter standards and become aligned with the federal requirements.
(5) Justification for the imposition of the stricter standard, or additional or different responsibilities or requirements. Not applicable