April 11, 2012 - Brandon Twp.- Diane Droste is hoping the third time's the charm.
Since she moved to the township in 1990, Consumers Energy has offered to extend gas mains in the township twice before this year. Both times, most recently in 2002, Droste put down her deposit, signifying her interest. But not enough of her neighbors joined her and her deposits were refunded.
On Tuesday night, at a Consumers Energy Customer Attachment Program meeting that packed the Brandon High School Performing Arts Center, Droste handed over a $200 connection fee deposit and hoped for the best— that it will not be returned and her home will be heated with natural gas by December.
"This time they've sweetened the deal," noted Droste. "They're connecting quickly and they're offering financing for the gas main contribution."
Consumers Energy announced in February a proposal to install gas mains in unserviced areas of the township in three phases. Overall, the project would offer service to 2,000 occupied structures.
"Hopefully, we'll saturate the entire township in three years and make natural gas available to every resident," said Consumers Energy Customer Attachment Program Manager Dan Jones at the April 10 meeting.
Letters were sent to 442 households that would be included in the first phase of the project, inviting residents to the meeting. The first phase of the project includes Allen Road, Brandon Lane, Breezewood and Breezewood Court, Burris Road and Burris Court, Cook Trail, Harmony Lane, Ingles Lane, Kathleen Lake Drive, Lakeview Trail, Laughing Wolf Lane, Little Lake Road, Marsh Lane, McNaughton, Oakbrook Drive, Osprey Ridge, Reese Road, Sarah's Way, Sashabaw Lane, Sashabaw Road (south of Granger), Seymour Lake Road (east of Perry Lake Road), Shady Lane, Sherwood Road and Sherwood Court, a portion of Stanton Road, Thornridge Trail, Victorian Lane, and Wooley Road.
A line was out the door of the BHS PAC prior to the meeting, as guests were asked to have one member of each household sign in. A Consumers representative confirmed after the meeting that 300 households were represented, the majority of those from the 442 to be included in the first phase of the project.
Debra Dodd, Consumers Energy spokesperson, said that 79 contracts were signed committing to the first phase of the project at the meeting, a little more than 30 percent of the contracts needed.
"Typically, to get this kind of response is very good," said Dodd. "We are pleased with it. It's our first large scale meeting held in 10 years. We were impressed with very good questions asked by the residents."
Jones said that 221 contracts, or 50 percent participation, is needed in order for Consumers to move forward with the project. However, he said that if the utility falls slightly short of that number, they may still be able to proceed. He also raised the possibility that if the company fell way short, they would identify clusters of residents in the township to whom natural gas may still be offered.
The primary motivation to switch to natural gas from other heat sources including propane is price, said Jones. He had previously said the equivalent cost of natural gas against propane is 89 cents per gallon, but during Tuesday's meeting, the price was down even more— to 84 cents per gallon, including, he stressed, ALL charges from Consumers. He compares that to $2.19 per gallon for the average price of propane and points out that natural gas customers would save $1.35 per gallon.
"You need to get a handle on how much gas you're using to see how much you would save annually," Jones said. "But you eliminate the expense of delivery and buying bulk."
Consumers will provide financing to residents at a rate of 8.06 percent over a 10-year period (for the gas main contribution, not to exceed $4,076.14 per resident); and Consumers will provide 333 feet of service footage at no charge with additional service footage being charged at a rate of $8.84 per foot.
The financing option is new and would equate to a $49.59 monthly payment over 120 months. If a resident chose to finance the $4,076.14 gas main contribution for the full length of the loan, $1,873.96 would be paid in interest at the offered rate. Jones said there would no penalty if a resident paid off their loan early and financing would not begin until six months after construction is completed. He compared it to deals that offer "Six months same as cash."
If a resident were to sell their home while still paying on the gas main contribution, they must disclose the loan to the buyer.
Most appliances can be converted to natural gas, Jones said, with the exceptions being hot water heaters and gas log fireplaces.
At the end of the meeting, Jones took questions from audience members. One man asked why residents were financing Consumers Energy's infrastructure. Jones responded that Consumers Energy is a government-regulated utility and the first phase of the gas main extension in the township is a $6 million construction project if all residents participate.
"Customers pay 10 to 20 percent of the total cost, we pick up 80 percent of the cost," he said. "Certain types of construction are cheaper than others, but we are bound by safety regulations... We've had hundreds of requests in the last five years. This is the fastest way to get everyone natural gas."
He also noted that if some neighbors choose not to join the project now, they can join at a later point and won't have to pay as much on the gas main contribution. He said that like a new car, the new gas main would depreciate after a few years. However, he said that while the neighbors who wait wouldn't pay as much for the gas main contribution as those who connect now, they would also continue paying more, possibly thousands of dollars more, in higher propane costs during the years they waited. Plus, their connection fee could be more later on.
"This is a good thing for the community," said Nick Kovasity, a resident who signed up for natural gas at the meeting. "I've been here since 1972 and in that time, energy costs have risen 300 percent. I pay $4,100 for one year of propane. When I got my bill, I knew I had to do something. Switching to natural gas will save me $2,200 per year."
Jeremy Kratt of Hamilton's Propane, a local propane distributor, declined to comment but said customers who have questions about the conversion from propane to natural gas could call the business.
Consumers Energy will host a second Customer Attachment Program meeting at 7 p.m., April 26, also at the BHS PAC, 1025 S. Ortonville Road.
Susan covers Brandon Township and Ortonville