LANSING — State Representative Jeff Irwin (D-Ann Arbor) introduced House Bill 5913 today to make sure customers aren’t paying for unrepaired gas leaks. This comes after a recent economic analysis found that allowing utilities to charge customers for wasted gas gives them less incentive to fix their systems.
“The public should not be subsidizing gas leaks,” Rep. Irwin said. “Charging customers for gas that they never get picks their pockets and pollutes the environment.”
The Michigan Public Service Commission (MPSC) regulates utility prices and, in turn, companies report their costs back to the MPSC to justify their rate hikes. Currently, gas companies can claim “lost and unaccounted for” gas, including known leaks and materials vented during maintenance. This means that not only are customers bearing the cost of leaked natural gas, but the public at large is then exposed to the negative environmental effects of pollution and climate change.
A recent study found that gas companies don’t spend as much money repairing leaks as the lost gas is worth. The authors of this study attribute this failure to minimize costs to the fact that consumers, not gas companies, bear much of the costs for leaked gas. Under Rep. Irwin’s bill, utilities would still be able to pass on to customers the costs of repairing and preventing leaks, but not the cost of the leaked gas itself.
“Instead of charging gas customers for polluting our air, we should put Michiganders to work fixing our infrastructure,” Rep. Irwin said.