Hurlock meeting raises gas issue again

Susan M. Bautz
Posted 11/18/14

Dorchester Banner/Susan M. Bautz At a Nov. 12 public forum in Hurlock, Chesapeake Utilities representatives Darrell Wilson (l), marketing and communications director for the local area, presented …

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Hurlock meeting raises gas issue again


MD-hurlock 3x no1-111714 Dorchester Banner/Susan M. Bautz At a Nov. 12 public forum in Hurlock, Chesapeake Utilities representatives Darrell Wilson (l), marketing and communications director for the local area, presented information and answered questions about natural gas as an inexpensive alternative energy source.

HURLOCK — The availability of natural gas as a cheaper energy option raised questions in Hurlock that were addressed at a Nov. 12 public forum. The town’s Main Street business community and some residents asked questions and got answers from Chesapeake Utilities representatives. Founded in Dover, Del. in 1859 as the Dover Gas Light Company, Chesapeake Utilities and its subdivisions now operate in six states.

Darrell Wilson, marketing and communications director for the local area, and Greg Denston, regional sales marketing coordinator, presented information and answered questions for 35 attendees.

Mayor Joyce Spratt opened the forum and said she and Town Administrator John Avery have “been working with Chesapeake Utilities for the better part of a year. We’re not against natural gas but there are a lot of questions . . . It’s got to be reasonable for them to come in. They won’t run a line for just one person on one street.”

Mr. Wilson said, “Our goal is to go over and above the norm to deliver exceptional customer service.” From 2007-2013 growth was 16 percent which he said “is pretty good in the natural gas industry.” Safety is first and foremost. He noted that natural gas is the cleanest fossil fuel, is a 99 percent domestic product, and offers potential energy cost savings of 15-35 percent.

In 2011 Hurlock granted a franchise to the Utility that permits access to rights-of-way for construction and operation of a gas distribution system. For that, the town receives a franchise fee. Amick and B&G joined the franchise in 2011 and Hurlock Elementary School was later included.  Mr. Wilson added, “We also met with some members of the business park to do a financial analysis” but there was not enough interest to proceed.

He thanked Frank Bittner, spokesman for the Hurlock Citizens and Seniors group, for the work he has done to energize the interest level of consumers. Interested residents can complete questionnaires. Based on the number of returned questionnaires the company will gauge interest in committing to proceed to the next step. To construct a significant extension, natural gas companies determine both the safest and most economical way to “get there.” A franchise with Lewes, Del. was signed based on two anchor customers: Beebe Medical Center and SPI Pharma. Volume was the incentive.

Questions centered on: Feasibility, cost savings, and conversion costs. Two 500psi high pressure gas lines run underground in Hurlock. According to Mr. Wilson, a major challenge is tapping those gas lines and installing pipe under existing streets, trees, sidewalks, water, and sewer.

Mr. Denston and Mr. Wilson said a major consideration is economic. If the main service line is under a street the cost to connect 75’-100’ to a home or business is about $2,400-$2,500. With a minimum of 80-90 percent of committed residents in each block, the company pays for the connection cost including labor, contractor, traffic control, and material. The cost of connecting from the meter to an appliance and the cost of converting existing appliances to natural gas is borne by the consumer.

According to Councilman Jerry Rhue the high pressure line was “probably” laid in the early 1960s.  Resident and business owner J.C. Collins said “some of us have wanted this for 10 years.” He is not alone. Several interested members of the town’s business community, including Food Rite, Pizza Palace, and Stop Shop also attended the meeting.

The costs of conversions vary depending on the age and type of equipment; propane, electricity, or oil. Mr. Wilson estimated that an oil furnace conversion could run from $3,000-6,000; an oil water heater could cost from $1,000-$2,000. “If you save $300 a year and your conversion cost is $1,200, over 4 years you’ve broken even,” he said.

Pizza Palace owner Michele Seretis’ asked for the cost of propane conversions. Greg Denston responded that it depends on the particular units and their age. The easiest is a cooking range.   For a dryer or heating system, it depends on “orifice units or some changes on the controls.”  Conversions are performed by a heating or plumbing professionals and paid for by the customer.

Town Administrator John Avery said the engineering design is almost complete for replacing the water main and laterals from the Main St. blinking light to Mapleton off Academy Street. Several attendees asked if Chesapeake Utilities could bury service lines when the town tears up the streets so business owners could tap off the high pressure line.

Mr. Denston replied that high pressure transmission lines cannot be tapped. To bring service in for distribution gas must go through a “gate station” series of regulators and meters that reduce high pressure to workable pressure. A second service line from a gate station near Perdue distributes gas to the elementary school. It cannot be extended to Main Street unless several hundred customers commit to use natural gas.

Mayor Spratt added that the company needs a certain percentage of interest and “that’s where we’re having the problem.” Mr. Wilson said the first step is completing and returning the questionnaires. If enough are received a feasibility study can be done. He will communicate the analysis to the Mayor and Council and arrange another meeting.

The town will mail questionnaires to residents and businesses. In the meantime, Mayor Spratt agreed to re-canvass the industrial park. Councilman Rhue asked if there is 80-90 percent interest on Main Street will it be evaluated. Mr. Denston said “yes.” Mr. Rhue encouraged the businesses to “group together so these guys can go back and do their homework.”

Councilman Charles Cephas and Mr. Collins each suggested that the matter be brought to referendum to help determine the level of consumer interest.

The problem is not that service line transmissions are impossible to achieve, but the number of participants must be economically attractive for Chesapeake Utilities to pay for constructing step down gates to tap the high pressure lines for natural gas distribution to customers. And because it is more difficult to install service lines under streets in older communities, the company would probably find it more economical to offer service in new developments or as an initial part of the infrastructure for a new business.

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