APGA Weekly Update February 11, 2016

02-11-2016 12:50

President Obama Releases 2017 LIHEAP Budget Proposal

On February 9, President Obama released his proposed fiscal year 2017 federal budget. With large numbers of low-income families seeking assistance this year, the Obama administration has recommended reducing spending on the Low Income Home Energy Assistance Program (LIHEAP) from the fiscal year 2016 level of $3.39 billion to $3 billion in fiscal year 2017, a $390 million decrease.

This budget also establishes a $560 million mandatory contingency fund to address increases in energy prices, extreme weather and changes in the numbers of eligible households. This contingency fund has been proposed by the administration before but has been eliminated due to congressional objections. Additionally, the administration proposes that Congress allow states to spend up to 40 percent of LIHEAP funds for weatherization without needing federal approval.

President Obama’s budget will now be submitted to Congress and sends a message on the priorities that the President would like to pursue. After Congress receives the budget, it will be dispersed to various committees where it will be reviewed and reprioritized. It is during this time in committee that Senators and House members have the opportunity to add or remove additional program funds. It is important to note that the President’s budget is largely symbolic and faces many obstacles including a Republican majority in Congress and election year politics.
APGA has recently signed on to an open letter from the National Energy and Utility Affordability Coalition (NEUAC), to congressional appropriations committees asking for an increase in the amount of LIHEAP funding for fiscal year 2017 to $4.7 billion. At the same time, APGA continues to push for full funding at the authorized $5.1 billion level.

For questions about this article, please contact Todd Brady of APGA staff by phone at 202-370-6211 or by email tbrady@apga.org.

PHMSA Issues Advisory on Snow and Ice Impact on Distribution Systems

On February 11, the Pipeline and Hazardous Materials Safety Administration (PHMSA) issued an advisory bulletin advising owners and operators of petroleum gas and natural gas facilities of the need to take the appropriate steps to prevent damage to pipeline facilities from accumulated snow or ice. Past events on natural gas distribution system facilities appear to have been related to either the stress of snow and ice or the malfunction of pressure control equipment due to ice blockage of pressure control equipment vents. This advisory reminds owners and operators of the need to take precautionary actions to prevent adverse events.
PHMSA is advising operators of petroleum gas and natural gas pipeline facilities, regardless of whether those facilities are regulated by PHMSA or state agencies, to consider the following steps to address the safety risks from accumulated snow and ice on pipeline facilities:
a. Notify customers and other entities of the need for caution associated with excessive accumulation and removal of snow and ice. Notice should include the need to clear snow and ice from exhaust and combustion air vents for gas appliances to prevent accumulation of carbon monoxide in buildings, or prevent operational problems for the combustion equipment.

2. Pay attention to snow and ice related situations that may cause operational problems for pressure control and other equipment.

3. Monitor the accumulation of moisture in equipment and snow or ice blocking regulator or relief valve vents which could prevent regulators and relief valves from functioning properly.

4. The piping on service regulator sets is susceptible to damage that could result in failure if caution is not exercised in cleaning snow from around the equipment. Where possible, use a broom instead of a shovel to clear snow off regulators, meters, associated piping, propane tanks, tubing, gauges or other propane system appurtenances.

5. Remind the public to contact the gas company or designated emergency response officials if there is an odor of gas present or if gas appliances are not functioning properly. Also, remind the public that they should leave their residences immediately if they detect a gas or propane odor and report the odor to their gas company, propane operator or designated emergency response officials.

A copy of the advisory can be found here. For questions on this article, please contact John Erickson of APGA staff by phone at 202-464-0834 or by email at jerickson@apga.org.

Senate Energy Bill’s Progress Stalls on Floor

As a result of a previous agreement to work on North Korea trade sanctions legislation, on February 9, the Senate energy bill was pulled from the floor. Progress on the bill stalled when an agreement could not be reached on an aid package to help Flint, Mich., address their lead-contaminated drinking water problem. The bill had enjoyed broad bipartisan support until the impasse on assistance for Flint stymied progress. Both parties worked over the weekend in an attempt to reach a compromise but were unable to do so. Senate Majority Leader McConnell (R-Ky.) filed a petition for cloture to bring debate on the bill to a close and move it towards final passage. Unfortunately, with the Flint assistance issue unresolved, the vote pretty much fell along party lines (43-54) and as a result was far short of the 60 vote threshold needed to invoke cloture. In pulling the bill from the floor yesterday, Majority Leader McConnell communicated he was not giving up on the energy bill. He further stated that the bill has “too much support on a bipartisan basis for us to walk away from it."

The legislation contains several provisions supported by APGA including language that delays the Department of Energy’s (DOE) implementation of the furnace rule to allow stakeholders the opportunity to negotiate and reach agreement on a rule that makes sense. Specifically, the furnace language in the bill would prohibit DOE from prescribing a final natural gas furnace rule until:

1. DOE convenes a representative advisory group of interested stakeholders, including, among others, manufacturers, distributors, contractors, home builders, energy efficiency advocates, natural gas utilities, electric utilities, and consumer groups;

2. That advisory group completes an analysis of a nationwide requirement of a condensing furnace efficiency standard within one year including a complete analysis of current market trends regarding the transition of sales from non-condensing furnaces to condensing furnaces, the projected net loss in the industry of the present value of original equipment manufactured after adoption of the standard, the projected consumer payback period and lifecycle cost savings, a determination of whether the standard is economically justified, and other common economic principles; and,

3. The advisory group makes a determination as to whether a nationwide requirement of a condensing furnace efficiency standard is technically feasible and economically justified and that determination would be published in the Federal Register.
Should the advisory group determine that a nationwide requirement of a condensing furnace efficiency standard is not technically feasible and economically justified, DOE is required to, within 180 days from the date the determination is published in the Federal Register, establish amended standards through a negotiated rulemaking process. By contrast, the furnace language in the House-passed energy bill delays DOE’s furnace rule until July 2016 to allow stakeholders the opportunity to continue negotiations.

With the bill being pulled from the floor, its fate remains unclear. The bill could be brought to the floor at some point in the future and if an agreement on an assistance package for Flint can be reached, whether it is part of the Senate energy bill or moves through Congress in another form, it is anticipated that the bill could move towards passage fairly quickly. However, if and once the Senate passes a bill, a conference committee will need to be formed to resolve differences between the Senate energy bill and the energy bill passed by the House. The final bill will need to be brought back to the House and Senate floor again for a vote and then will be sent to the President in a form, meaning the bill has strong support from Democrats, where he will agree to sign it into law. There is still a fair amount of work that would need to be done towards getting an energy bill signed into law. For questions on this article, please contact Dave Schryver of APGA staff by phone at 202-464-2742 or by email at dschryver@apga.org.

Celebrate Natural Gas Utility Workers' Day

March 18 is now national Natural Gas Utility Workers' Day! In 2015, the APGA Marketing & Sales Committee began discussing how they believed natural gas utility workers deserved a day to be recognized for their hard work and accomplishments. After several months of planning, the committee named March 18 the day in which natural gas utility workers around the country will be honored each year. The decision to hold this day on March 18 was made by a poll on the APGA community. March 18 is the date of the New London, Texas school explosion in 1937 that led to the widespread odorization of natural gas and an increased emphasis on safety. Safety is a vital aspect to natural gas distribution and the employees of distribution companies endeavor to make natural gas delivery as safe as possible. Please honor the natural gas utility workers in your community and at your system by celebrating on March 18! APGA will provide materials to use in the coming weeks. In the meantime, we encourage you to plan events, communication, social media posts, etc., to celebrate this new and very important day! For questions on Natural Gas Utility Workers' Day, please contact Audrey Anderson at aanderson@apga.org.

EIA Reports Storage Decrease of 70 Bcf to Put Working Gas Storage at 2,864 Bcf

Here is the weekly EIA Summary Report issued on Thursday, February 11, 2016, which reports the week’s storage report highlights for Friday, February 5, 2016. A 152 Bcf decrease has been reported. Working gas in storage was 2,864 Bcf as of Friday, February 5, 2016, according to EIA estimates. This represents a net decline of 70 Bcf from the previous week. Stocks were 573 Bcf higher than last year at this time and 543 Bcf above the five-year average of 2,321 Bcf. At 2,864 Bcf, total working gas is above the five-year historical range.

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