Interpretation Response #PI-10-0004 ([South Carolina Office of Regulatory Staff] [Mr. Vernon Gainey])

Below is the interpretation response detail and a list of regulations sections applicable to this response.

Interpretation Response Details

Response Publish Date: 09/17/2010

Company Name: South Carolina Office of Regulatory Staff

Individual Name: Mr. Vernon Gainey

Country: US

View the Interpretation Document

Response text:

Sep. 17, 2010

Mr. Vernon Gainey

South Carolina Office of Regulatory Staff

Supervisor, Pipeline Safety

1401 Main Street, Suite 900

Columbia, SC 29201

Dear Mr. Gainey:

In a letter to the Pipeline and Hazardous Materials Safety Administration (PHMSA) dated May 11, 2010, the South Carolina Office of Regulatory Staff (ORS) requested an interpretation of 49 CFR § 192.1 in response to a letter ORS received from the Easley Housing Authority (EHA) asserting that it is not subject to the pipeline safety regulations in 49 CFR Parts 191 & 192 as adopted by South Carolina pursuant to section 58-5-970 of the South Carolina Code of Laws.

ORS described the operation as follows: (1) EHA is a public housing authority that receives natural gas from a metering station; (2) downstream from the metering station EHA owns and operates the natural gas pipeline system; (3) a gas meter was installed previously at each tenant house in the housing authority, but that metering system has been removed by the operator; (4) the cost of the natural gas EHA provides to each tenants is covered by the rent charged to each tenant. EHA contended that its natural gas pipeline system is not subject to the pipeline safety regulations because it does not meter and sell gas to its tenants. ORS believes that EHA is subject to the pipeline safety regulations because it transports gas in its pipeline system from the distribution company's meter to the individual consumers which makes EHA a natural gas pipeline operator.

ORS is correct that the natural gas pipeline system operated by EHA is subject to the pipeline safety laws and regulations. Generally speaking, when gas is purchased at a master meter and then is distributed through underground or exterior piping to others who consume the gas, the system is considered to be a gas distribution system. Operators of gas distribution systems, including master meter systems, must comply with both the reporting requirements in Part 191 and the operating, maintenance and other requirements in Part 192.

Pursuant to 49 U.S.C. 60105, South Carolina is authorized to regulate the gas distribution systems in the state. In the absence of an exemption for master meter systems in state law, this includes master meter systems. Whether EHA meters and sells gas to individual customers is irrelevant. The piping through which gas is being transported is owned and operated by EHA. This makes EHA a gas pipeline operator under the pipeline safety laws and regulations. Accordingly, as the operator, EHA is responsible for compliance with the pipeline safety regulations in 49 CFR Parts 191 and 192 as adopted by South Carolina.

I hope that this information is helpful to you. If I can be of further assistance, please contact me at 202-366-4046.

Sincerely,

John A. Gale

Director, Office of Regulations

Regulation Sections