Sunday, October 29, 2000
Gas main break costs Cinergy
$400K in sales lost; repairs likely higher
By Terry Flynn
The Cincinnati Enquirer
NEWPORT Cinergy may have lost a total of about $400,000 in natural gas sales as the result of a broken gas main earlier this month, but that figure is expected to pale when compared with other costs relat ed to the outage that affected more than 3,000 customers in the city.
Cinergy spokesman Dave Woodburn said the utility is still tallying a variety of costs directly connected to the gas main break, including:
Overtime for Cinergy crews that worked 16-hour shifts to restore gas service.
Costs of utility crews that came in from Indiana and Ohio.
Costs of all the private contractors who worked on damaged appliances.
Cost of gas control valves and other materials and equipment costs.
Cost of replacement gas meters.
We still don't have all the numbers, Mr. Woodburn said Friday.
He said it was difficult to come up with an accurate figure for how much money in gas sales Cinergy lost, because factors such as vacant structures that don't use gas, multifamily dwellings and what Cinergy pays for the gas before it sells it to customers have to be considered.
We use an average figure of 25,000 cubic feet of gas per month for a household in winter, which would be about $200 a month, he said. For the nonwinter months (which includes October), the average is about $90 a month.
But of that $90, $55.69 is what is known as the gas recovery figure, what Cinergy pays for the gas. We can store gas, so we can't lose what we pay for it, Mr. Woodburn said.
Using the initial number of services without gas Oct. 5, and the services restored each day over the 10-day period, the cost for the amount of gas not sold minus the gas recovery figure is about $400,000.
Cinergy also had 40 to 50 work crews on the job, most working 16-hour shifts, which means lots of overtime pay.
In addition, more than 100 private contractors, some from out of town, responded to Cinergy's call for help with appliance repairs. It is not unusual for an HVAC (heating, ventilation and air conditioning) contractor to bill at $110 an hour for double time on weekends.
Friday was the last day Cinergy supplied private contractors for appliance repair. The utility paid the contractors and plans to recoup its expenses later. Anyone who still has a problem with an appliance that was damaged by water in the gas line must now hire their own HVAC contractor.
The city also has costs related to the gas main break, which apparently happened when an 8-inch water main ruptured in the parking lot of the Newport Shop ping Center and pumped water into the gas main and then into meters and appliances in homes.
We're still working on our numbers, and I hope to have a good estimate for Monday night's city commission meeting, Newport City Manager Phil Ciafardini said Friday. We're hoping to have some figures from Cinergy at that time also.
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