Learn individually about gas conversion

By Larry Slone
Editor’s note: This is the edited version of Larry Slone’s piece that updated numbers. The Homer Tribune apologizes that this is not the version that made it into the print version.
Regarding natural-gas home-conversion costs, in last week’s letter Borough Assemblyman Bill Smith said: “To assess the cost of converting to natural gas, we must each do our own research to see what fits our own building.” And I say: “Please do.”
Let’s start with a quick review: The city of Homer and Enstar are negotiating a contract for Enstar to bring natural gas piplines into Homer and thence to 3,855 city lots, 90 percent of the total. The contract has yet to be reviewed and approved by the city council; it ain’t yet a done deal. If approved by the council, however, it then has to be approved by we, the people (actually, the affected lot-owners). That vote won’t occur until late January. Strangely, that voting procedure – established by city ordinance – is contrary. If you don’t actually mark “No, I don’t want Enstar’s gasline,” or you neglect to return the form, it will be counted as a “Yes, I do indeed want Enstar to bring the gas-line up my street, to my lot-line, and I am willing to pay the $3,300 assessment by the city for each and every lot I own, vacant or otherwise, that can potentially be served by this gas-line, even if I don’t hook-up to it.” Fortunately, you won’t have to pay this $3,300/lot up front; the city will borrow money to pay this cost ($12.2 million city-wide). Of course you have to pay it back, at about 4 percent interest, by making $34 or so monthly payments to the city. Kinda like making city water/sewer bills except cheaper. Plus this obligation will expire in about 10 years.
OK, assuming Enstar natural gas is voted in as proposed, here’s how it might play-out: Next summer the “trunk line,” costing an estimated $10.65 million in total, will enter town from the west, proceed in a stately manner eastbound along Fairview Avenue, and eventually terminate in Kachemak City. It’ll be paid for from two sources: One, the $8.15 million grant from the legislature; Two, the remaining $2.5 million will be provided via the $1/mcf ($1 per 1000/cu.ft) tariff, which means a very slight increase on the price of gas that you consume. In 10 years the $2.5 million will be paid off. There’s also something called a “free main allowance” which is techno for, “We at Enstar may refund the city an additional significant amount over the next 10 years ‘cuz your saving us money by having just one, efficient, city-wide SAD (Special Assessment District).
So, from the trunk line will sprout the “main extension” lines, put-in by the lowest-bidder who qualifies. Each main extension will snake up a different street, ultimately passing by the various 3,855 lots at the aforementioned $3,300 per lot. Eventually one will pass by your lot. If you really do want gas, for about $1,500 Enstar will gladly hook up your personal “service-line” and bring it that last 100 feet or so to their meter, placed alongside your house. Then they’ll walk away; you’re be on your own; just you and your plumber. But for $100 he’ll tell you how to actually get that “blue-flame” heat coming off your cook stove’s burner or warm-air from your furnace.
Before paying that $100, though, you might want to get a rough estimate. Bill Smith has provided on the city’s website, the natural gas section, examples of conversion costs. Not online, though, is his assessment of conversion costs for public buildings, because, as he says in a letter to me, ” they are mostly in line for such huge savings that the conversion costs are simply not an issue. This holds true for our larger commercial buildings as well.” Anyway, for some home-owners conversion from propane will be simple. For others with more involved or older systems, well, it can quickly get confusing and spendy, so just go ahead and engage that $100 plumber.
Finally, please understand that any debt incurred for cost-conversions of your home-system is in addition to that $34/lot monthly payment. These costs would generally be paid for by the money saved from that conversion because natural gas is currently so much cheaper than the alternatives. According to my calculations, per btu’s produced, natural gas is less than one-third that of heating oil, one-sixth that of propane, and one-eighth that of electricity. Wonderful. But one downside is that you are incurring another debt that might take years to pay-off; no help to those of us, such as myself, who wish to soon sell our house.
Larry Slone
Larry Slone is a Homer resident who frequently attends Homer CIty Council meetings.

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Posted by on Oct 31st, 2012 and filed under Point of View. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

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