Vermont Gas may pay $25,000 for violations

Ground cleared for the Vermont Gas pipeline, portions of which regulators have found were not properly buried. File photo by Morgan True / VTDigger

[V]ermont Gas, the natural gas utility owned by Canadian fossil fuel giant Énergir, has likely buried an Addison County gas pipeline improperly, regulators said this week in a filing with the Public Utility Commission.

The Department of Public Service has asked the PUC to assess a $25,000 fine against Vermont Gas for failing to bury the pipeline according to the standards set out in the state permit authorizing the pipeline’s construction.

Vermont Gas had agreed, as a condition of its 2013 Addison County gas pipeline construction permit, to bury the pipeline on top of sandbags, or on other support structures, or on at least six inches of approved backfill material. But the Department of Public Service said Wednesday that it had identified about 4,300 feet of pipeline sitting on unsupported earth.

On at least four occasions between 2015 and 2016, Vermont Gas buried pipeline without the supports required in the permit, the Department of Public Service charged in its ‘Notice of Probable Violation’ letter to the Commission.

It is a violation of state law to build a structure that doesn’t comply with approved written standards, DPS representatives said in the letter.

Improperly buried pipe could corrode as a result of the different types of soil above and below the pipeline, they said.

Vermont Gas is also charged in the letter with failing to act to reduce soil erosion around the pipeline by shunting groundwater away from the structure.

The Department of Public Service is, as a result, “concerned that this installation may have an increased susceptibility to soil erosion around the pipe, which may affect the integrity of the pipe.”

The department also claimed that Vermont Gas patched “anomalies” in the pipe’s protective coating with “certain manufactured lots of Canusa sleeves (‘wraps’) that exhibited adhesion failure."

DPS engineers also identified another two locations where the pipe’s protective coating may have been damaged while it was installed using ‘horizontal directional drilling.’ Horizontal directional drilling, or HDD, is a practice Vermont Gas used to bury some portions of the pipeline by tunneling through soil horizontally and stuffing the pipeline into the hole. The rest of the pipeline was laid within a trench workers dug and, in most portions, reinforced with supports along the bottom.

The adhesion failure and the potential pipeline damage didn’t violate the law, but they could nevertheless cause corrosion.

“While the Department is not at this time considering the above two items (patch adhesion failure and HDD damage) to be code violations, the Department is concerned that these two issues could, over time, present a corrosion risk to the pipeline,” the letter states.

Because of the threat of corrosion, the letter recommends increasing the inspection schedule from every seven years to every five years, and for Vermont Gas to identify and repair damage from corrosion on the same schedule.

The $25,000 fine the department has asked the Public Utility Commission to assess against Vermont Gas is intended as a deterrent, the letter said, but it is also intended to reflect any profit the company made as a result of the violations, as well as the company’s past record of violations.

Vermont Gas was fined $25,000 in 2017 for killing a patch of rare flowers, and in 2016 the company was fined $100,000 for violating another set of written standards. The company paid an additional $100,000 for more than doubling the price of the pipeline from what Vermont Gas representatives told the state it would cost when the company sought its original permit.

Although the violations listed in the DPS letter this week could accelerate corrosion of the pipeline, they were not as serious as the violations that resulted in the $100,000 fine in 2016, Jim Porter, the director of DPS’s public advocacy division, said. The 2016 violations endangered workers, Porter said, while the violations described in Wednesday’s letter pose no immediate threat.

“If this were a safety problem it would have been addressed a long time ago,” Porter said.

Porter said he could not estimate how much money Vermont Gas would have saved by violating the terms of its permit.

The $25,000 fine DPS recommended is in line with what the federal Pipeline and Hazardous Material Safety Administration assesses for similar violations, Porter said.

The pipeline safety administration reviewed Vermont’s gas pipeline safety program last year and found the state not “up to date” on identifying all probable pipeline violations, and not following through on compliance actions.

PHMSA spokesman Darius Kirkwood declined to detail the probable violations.

Vermont Gas spokeswoman Beth Parent said the company itself had reported most the problems outlined in the DPS letter. She noted that none of the violations pose a threat to safety. Porter concurred that the pipeline meets federal safety standards.

Jim Dumont, a Bristol attorney representing a number of complainants in a lawsuit against Vermont Gas for failing to follow required construction practices, said he is happy to see the Department of Public Service taking action against the gas company.

Dumont said he is seeking to broaden an investigation by the state into how deep underground the pipeline is buried.

The gas company failed to bury the pipeline at the depth required in the permit, at multiple locations.

“We believe there’s a lot more to this than the Department [of Public Service] has alleged,” Dumont said.

One of Dumont’s clients in the case, Rachel Smolker, said while she is glad the Department of Public Service is acting, the $25,000 fine “is not likely to be terribly much of a deterrent.”