Senate Approves Bill To Accelerate Critical Utility Infrastructure Improvements

The state Senate today unanimously approved legislation that will provide a critical tool to accelerate the replacement of aging natural gas, electric and wastewater systems in the Commonwealth, create new jobs and increase public safety, according to Senator Tommy Tomlinson (R-Bucks).

Tomlinson, who chairs the Senate Consumer Protection and Professional Licensure Committee, said House Bill 1294 will establish a new financing method — known as a distribution system improvement charge process (DSIC) — to expedite utility infrastructure projects.

This change would enable natural gas distribution companies, electric distribution companies and wastewater companies to accelerate the replacement of existing corroded, brittle or other at-risk lines, funded by a small surcharge. Currently, these utilities must wait for the completion of a rate case to begin receiving a return on their investment — a time-consuming process that delays projects and leads to higher costs for consumers.

“The Legislature provided a similar financing mechanism to water companies in 1996 and it has been extremely effective — increasing the rate of replacement of aging infrastructure by more than 200 percent,” Tomlinson said. “By moving to this more efficient infrastructure funding plan, customers will avoid costly rate cases and receive better, more reliable service. Our utilities will save money and avoid expensive delays, expediting critical projects and saving consumers money.”

He added that the bulk of Pennsylvania’s current utility infrastructure was originally built in the 1940s. Today, many systems are simply unsafe and must be replaced.

Tomlinson said the bill was amended in the Senate to include important safeguards for consumers. Utilities would be required to file a long-term infrastructure plan with the Public Utility Commission, be subject to additional audits and face penalties for overcharging consumers under the DSIC.

“All consumers will benefit from a utility infrastructure that is safer, modern and more efficient. This isn’t something we should do, it’s something we must do for the sake of public safety,” Tomlinson said. “It will also allow us to create good family-sustaining jobs to improve our economy.”

House Bill 1294 now returns to the House for concurrence in Senate amendments. Governor Corbett has indicated his support for the legislation.

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