OPC proposes comprehensive rules for implementing Next Generation Energy Act’s gas pipeline investment requirements
BALTIMORE – State regulators should implement comprehensive rules identifying how gas companies must demonstrate they have considered alternatives to pipeline projects before charging ratepayers for them, regardless of whether the companies seek payment through regular utility rates or accelerated payment through customer bill surcharges, the Office of People’s Counsel said in comments filed last week.
OPC’s proposed regulations filed with the Public Service Commission would implement the Next Generation Energy Act (NGEA), which took effect June 1, 2025, in a manner that ensures consistent requirements across gas companies, its comments explained. Under the NGEA, to recover costs for pipeline projects, gas utilities must show that their projects benefit customers and that the utilities analyzed alternatives. OPC’s proposed rules would apply both when the companies file Strategic Infrastructure Development and Enhancement (STRIDE) plans to obtain accelerated cost recovery through customer bill surcharges—and when companies seek cost recovery in a rate case.
“Our proposed rules will benefit customers by making gas utility plans more transparent and consistent in their consideration of alternatives to pipeline projects while enhancing the safety of the gas system,” said Maryland People’s Counsel David S. Lapp. “We believe the proposed rules will reduce gas utility rate increases that are inevitable if business continues as usual.”
OPC’s proposed rules would require gas companies to:
- assess all alternatives to pipe replacement, producing both a regularly updated long-term gas system assessment—looking at least 20 years ahead—to identify segments, branches, and neighborhoods that are good candidates for alternatives that may take longer to implement, such as targeted electrification, as well as shorter-term “project-level” analyses;
- identify all alternatives to a proposed pipe replacement as “available” or “unavailable” and the technical feasibility of each available alternative, then analyze cost effectiveness of each available and technically feasible option;
- adhere to consistent and transparent requirements for assessing risk, costs, customer benefits, cost-effectiveness, and pipeline alternatives; and
- document their analyses, maintain records, and provide those records during Commission STRIDE and rate case proceedings.
OPC’s proposed rules also would identify and manage safety risks in keeping with federal requirements without misstating those requirements as mandating pipe replacement. Instead, OPC’s proposed regulations would require gas utilities to analyze alternatives to pipe replacement and then modify their federally filed distribution integrity management plans—rather than permitting gas companies to use their existing plans to justify business-as-usual pipe replacement.
OPC’s comments filed with its proposed regulations highlighted that other states—including New York, Massachusetts, and Illinois—have already been developing similar comprehensive approaches to gas pipeline alternatives planning.
Commission Staff also proposed regulations, which Staff filed Friday, July 31 together with proposals from OPC and others in Commission Rulemaking Docket 95. The Commission will accept additional comments on proposed regulations through August 26, 2026, and hold a rulemaking session on September 2.
The Maryland Office of People’s Counsel is an independent state agency that represents Maryland’s residential consumers in electric, natural gas, telecommunications, private water and certain transportation matters before the Public Service Commission, federal regulatory agencies, and the courts.
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