Columbia Gas proposes charging customers $300 million for gas pipeline program

Columbia Gas is proposing spending $85 million on gas pipeline work over the next 5 years through the STRIDE program.

The Maryland Office of the People’s Counsel, an independent state agency representing consumers, argued in a filing this week that the Public Service Commission should reject a request from Columbia Gas to launch a new 5 year STRIDE program.

Columbia Gas serves much of Western Maryland, with about 34,000 customers in Washington, Allegany and Garret County. According to OPC,  Columbia’s proposed $85 million plan would cost customers about $300 million over the next 40 years, driven largely by utility profits from the work.

This is the 3rd five-year STRIDE plan being proposed by Columbia Gas. Since their first plan was approved in 2014 Columbia customers’ gas bills have seen a 121% increase on average.

The STRIDE law of 2013 allows gas utilities to add a monthly surcharge to customers’ bills for certain gas pipeline expenses, serving as an incentive for the utility to replace old pipes. That spending is then paid back to the utility, with interest, for decades.

The more utilities spend on capital infrastructure like pipes and equipment, the more they profit. This creates a powerful incentive for wasteful spending. 

Unfortunately, the law did not specify that the money should be spent cost effectively nor prioritize safety, so the gas utilities have been spending big to replace instead of repair pipes.

Without modifications, gas customers from Columbia Gas, Washington Gas, and BGE are expected to be charged $40 billion over the next two decades for gas pipeline replacement work, much towards utility profits. For example, in 2023 alone, BGE spent about $160 million on its STRIDE plan. After accounting for BGE’s profits and interest, that $160 million will cost customers about $576 million.

The Maryland Public Service Commission has authority to reject or refine STRIDE proposals, and the state legislature is expected to consider modifying the STRIDE law during the 2025 session of the General Assembly to require spending to prioritize safety and be cost effective.