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PECO Can Pass Some Pipe Upgrade Costs to Customers

By: Jamison Cocklin |

The Pennsylvania Public Utility Commission (PUC) has approved Philadelphia-based PECO Energy Co.’s plan to implement a distribution system improvement charge (DSIC) so that it can pass some of the cost to upgrade its outdated and at-risk natural gas pipelines on to its customers.

PECO’s long-term infrastructure improvement plan (LTIIP) was approved by the PUC in May (see Daily GPI, May 18). Under the plan, PECO plans to spend $534.4 million by 2022 to replace some of its aging distribution system. The company has said that about 12% of its system is considered at-risk, but most of those pipes account for the company’s leaks.

PECO first filed its LTIIP in 2013, but it was updated earlier this year to accelerate replacement of its at-risk pipelines and to help provide for a faster relocation of indoor meters to outdoor structures. PECO provides electric delivery service to about 1.6 million people and natural gas delivery service to about 503,000 customers in Southeast Pennsylvania.

The PUC’s approval allows PECO to file a tariff to implement its DSIC by Oct. 1. The PUC, however, referred two issues to hearings before the PUC’s Office of Administrative Law Judge to discuss the DSIC calculation.

PECO’s LTIIP calls for replacing at-risk cast iron and bare steel mains by 2035 and relocating indoor meters by 2034.