UIL Holdings, the Connecticut company that last year attempted to buy PGW from the city, has itself been sold to a Spanish firm.
UIL officials said the $3 billion deal with Iberdrola materialized only after the PGW sale fell through. But the timing of the deal raised questions at City Council, and Council President Darrell Clarke suggested the move vindicated Council’s concerns about selling to PGW. Council let the proposed sale of PGW to UIL collapse last year without ever holding a hearing — or vote — before a deadline for the deal’s completion. Read more »
In the wake of the collapse of the sale of Philadelphia Gas Works to a private bidder, the Pennsylvania Public Utility Commission is pressuring the city to replace leaky gas pipes more quickly than planned.
It’s a long-range plan: Replacing century-old cast-iron pipes under the city’s streets is currently estimated to take another 88 years at the current pace. UIL Holdings, the private bidder, had promised to speed the pace. Now PUC is weighing in.
The PUC’s review will focus on analyzing PGW’s current plan and removing barriers to accelerate replacement of cast iron and bare steel pipes with tougher plastic ones.
(PUC Chair Rob) Powelson said the commission, which has had regulatory oversight over the utility since 2000, will also consider whether to force the city of Philadelphia to give up its $18 million annual fee from PGW and put that money back into the main replacement program.
“Having a system that is going to be replaced in 88 years, I think if you ask the average citizen, it’s not a question of if, it’s a question of when something’s going to happen,” Powelson said.
It’s not just Philadelphia, of course, but Philly is an obvious example of a place where the problem is worst: An old, large city. Philadelphia has some of the leakiest pipes in the nation. It’s a long, interesting piece.
In Philadelphia, the city gates feed natural gas into 6,000 miles of pipe that run beneath city streets. The “mains” are the pipelines that run along streets, while the “service lines” connect to houses and businesses. About 1,500 miles of main – a quarter of the total – are made of cast iron, some of it dating back to the 1890’s. Cast iron is problematic. It’s strong but inflexible. Joints leak. Countless freeze-thaw cycles cause the cast iron to crack. Heavy trucks rumbling on top can make a pipe give way.
Doug Oliver, Mayor’s Press Secretary. Copyright City of Philadelphia. Photograph by Mitchell Leff.
Mayoral aspirant Doug Oliver got knocked around a bit a few weeks ago after launching his exploratory committee on account of lacking any discernible agenda or priorities. Well, today Oliver is staking out a clear, detailed position on one of the most controversial political debates of the moment: the fate of PGW.
No, the City Council doesn’t show much sign of budging. And yes, UIL Holdings — the Connecticut company that has spent most of 2014 trying to buy Philadelphia Gas Works from the city, said last week it’ll walk away from the deal when its contract expires at the end of December.
But the PGW sale isn’t dead yet. Close, but not quite.
Philadelphia Business Journal reports that UIL officials are continuing to meet with and lobby city officials, hoping that the sale can be put on the City Council agenda for one of the year’s two remaining scheduled meetings — or that an additional meeting can be scheduled for just that purpose. The Journal talked to UIL spokesman Michael West: Read more »
The proposed sale of Philadelphia Gas Works to a private Connecticut company — a sale long considered on life support, at best — is one step closer to outright death.
UIL Holdings said Thursday that it is ending its pursuit of the Philadelphia utility; it will not renew its option to buy when that agreement ends at the end of December. The announcement came after Thursday’s City Council meeting, considered the last chance to jump-start the process to result in a sale by year’s end.
At this point, UIL Holdings — the Connecticut company that wants so badly to buy and privatize Philadelphia Gas Works — resembles the old guy from Monty Python and the Holy Grail. Yes, he’s in bad health. Yes, the future is dim. But he’s hanging on. “I’M NOT DEAD YET!” he screams.
So City Council has just released a rebuttal to a rebuttal to a letter summarily rejecting the sale of PGW. At least, I think that’s where things stand. It seems like everyone has a lot to say. Maybe — and I’m just spitballing here — a hearing on the proposed sale would have been a good place to air some of these issues out?
There will be no hearing on the sale, of course, which is at the root of this dysfunctional display. After two years, $21.3 million spent by the leading bidder, and two expensive reports from different analysts, Mayor Nutter figured he would at least get a Council hearing on the potential sale. Council President Darrell L. Clarke and the rest of council leadership — in what increasingly looks like a big political misstep — figured if council didn’t want the deal, why waste time with hearings?
You’ll find Council’s latest salvo below, as well as the Nutter administration’s effective, if dense, six pages of spin on the sale, which was first published last week by the Philadelphia Business Journal.
In an opinion piece published in the Inquirer today, Mayor Michael Nutter ripped City Council over its rejection of the deal to sell PGW to UIL Holdings Corporation, a gas company based in Connecticut.
It’s headlined, “Council, do your job on PGW.”
Nutter is particularly incensed that City Council did not even call for a hearing on the sale of PGW. (“What makes far less political sense was Council’s decision to never give the UIL deal a hearing,” our own Patrick Kerkstra wrote yesterday. “It just looks awful.”)