----- Original Message -----

From: "Lacey, Pam" [PLacey@aga.org]

Sent: 06/04/2010 02:35 PM AST

To: Roger Fernandez

Cc: Akachi Imegwu; "Plotkin, Victoria" <vplotkin@aga.org> Subject: RE: Subpart W - Additional Cost Impact Data - for Distribution M&R Annual Leak Surveys Docket EPA-HQ-OAR-2009-0923 Roger - I am sorry about the misunderstanding. I am also working on getting an answer to your question about state and federal leak detection requirements. - Pam

-----Original Message----- From: Fernandez.Roger@epamail.epa.gov [mailto:Fernandez.Roger@epamail.epa.gov] Sent: Friday, June 04, 2010 2:09 PM

To: Lacey, Pam Cc: Imegwu.Akachi@epamail.epa.gov; Plotkin, Victoria Subject: Re: Subpart W - Additional Cost Impact Data - for Distribution M&R Annual Leak Surveys Docket EPA-HQ-OAR-2009-0923

Pam

While we appreciate this information and we will consider it in our analysis, for the record, this is not the information that I requested in the email I sent yesterday of which I also placed in the docket.

If there is any confusion, I suggest we speak on Monday.

Thanks

Roger

----- Original Message ----- From: "Lacey, Pam" [PLacey@aga.org] Sent: 06/04/2010 01:32 PM AST
To: Roger Fernandez Cc: Akachi Imegwu; "Plotkin, Victoria" <vplotkin@aga.org> Subject: Subpart W - Additional Cost Impact Data - for Distribution M&R Annual Leak Surveys Docket EPA-HQ-OAR-2009-0923

Roger -- In response to your request for additional cost data showing our estimated costs for leak detection under the proposed Subpart W broken out by type of metering and regulating (M&R) station and meter, I am providing the attached spreadsheet provided by one of our larger member companies (with company-identifying information removed). This is a rough estimate, but is more likely to underestimate than

overestimate costs. Please forward this email and attachment to the rulemaking docket number EPA-HQ-OAR-2009-0923.

AGA is gathering additional cost data from members through a survey that should provide a broader view of costs. The survey data will also be broken out by type of M&R station (city gates, custody transfer stations, district regulating stations, industrial customer M&R,
commercial customer M&R, and residential customer meters). I will also forward the summary of survey results as soon as possible, in addition to including it in AGA’s comments to be filed June 11, 2010.Note: The member that provided the attached spreadsheet data explained they estimated that the incremental cost for conducting the annual leak detection called for in Subpart W would be $40.51 per inspection per city gate station or district regulator station or per industrial or commercial customer meter if infrared cameras are not required – roughly one hour of technician time. In contrast, they estimate it would cost about $16,125 per city gate to conduct the annual inspection using an infrared camera. The costs of using infrared cameras at other M&R locations varies by type –

· $16,125 per city gate

· $860 per district M&R station from transmission (custody transfer other than at city gate)

· $244 per district M&R station (stepping down pressure within distribution system)

· $377 per industrial meter

· $30 per commercial meter

· No figure given for residential – but likely to be roughly the same as for commercial – i.e. $30 per meter

You can multiply the per location estimates by the total number of city gates, custody transfer stations, industrial meters, commercial meters

and residential meters in the U.S. (based on the DOE EIA numbers of meters) to determine total cost for requiring infrared cameras at each type of metering and regulating location. Similarly, you can multiply $40.51 times the number of each type of M&R station or meter to determine the cost of requiring annual leak surveys under Subpart W, without requiring infrared cameras.

There are more than 70 million residential, commercial and industrial customers in the U.S. If leak surveys were required at each meter, but not infrared cameras, the cost would be $2,835,700,000 – nearly $3 billion per year, and that is without requiring infrared cameras. AGA requests that EPA clarify that the term M&R station excludes industrial,

commercial and residential customer meters.

Thank you for the opportunity to provide comments and data regarding the Subpart W proposal.

Respectfully,

Pamela

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Pamela A. Lacey| Sr. Managing Counsel, EnvironmentAmerican Gas Association

400 N. Capitol St., NW | Washington DC 20001 202.824.7340 | placey@aga.org | Fax 202.824.7082 | www.aga.org

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[attachment "AGA Member GHG Reporting Subpart W Potential Impacts June 2010.xlsx" deleted by Roger Fernandez/DC/USEPA/US]