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Little money spent on natural gas pipelines

Jeff Tyler Sep 13, 2010


Kai Ryssdal: Investigators are still trying to figure out why a huge natural gas pipeline exploded just south of San Francisco last week. At least four people were killed, more than 50 homes were destroyed. President Obama said last week that he wants to spend $50 billion on infrastructure repairs. None of it’s targeted at gas pipelines.

We asked Marketplace’s Jeff Tyler why not.

Jeff Tyler: The federal government oversees the regulation of gas pipelines, but it doesn’t pay for them.

Martin Edwards with the Interstate Natural Gas Association of America says private companies can reap…

Martin Edwards: …fairly attractive returns on the investment that’s made, and that percent of return on investment is sufficient to attract a pretty significant amount of private capital.

Edwards says that private capital pays for maintaining and repairing gas pipelines. Some watchdogs worry that the explosion in California might skew the debate.

Mindy Spatt: We don’t want concern over the tragedy in San Bruno to become a blank check.

That’s Mindy Spatt with the TURN Utility Reform Network. She says the local utility, PG&E, needs to be held responsible.

Spatt: The aging infrastructure is a concern, and probably does need some attention paid to it. But this particular pipeline, the maintenance of it is something PG&E was responsible for. And if there is one thing PG&E has plenty of, it’s money.

If the federal government decides it wants invest directly in gas pipelines, one component of the president’s new infrastructure stimulus plan could help: A proposed infrastructure bank would allow the government to circumvent political horse-trading and spend money on the country’s most pressing infrastructure needs.

I’m Jeff Tyler for Marketplace.

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