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Groveland gas line project finally complete



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March 12, 2014 - Groveland Twp.-One buck.

After 15 years, the township-wide natural gas pipeline came to a conclusion on Monday night at the board of trustees meeting when $1 was handed over to Consumers Energy, completing a project that now makes natural gas available on nearly every road.

"It's the end of a long process that brought natural gas to the township," said Bob DePalma, township supervisor. "By the time the project was done about 15 years ago, 600-700 residents were on the gas line."

Due to the low population density in the township, providing services like natural gas or any utility is not cost effective for suppliers like Consumers Energy to make significant investments down every road. However, the lower cost and convenience of natural gas, as compared to other available energy sources, prompted DePalma and other township officials to seek a means to bring the product to the sparsely populated rural areas. In 1998, DePalma, along with others, researched the issue and determined the cost of natural gas hook-ups would be 40 percent lower if the residents of the township signed up in a group.

The natural gas project required that at least 525 of the township's 850 households would have to express interest in hooking on to the pipeline.

"It took a lot of meetings and providing the public information before it really got off the ground," he said. "During a township-wide vote in May of 1999, about 95 percent of the residents supported making Groveland a gas utility company that paved the way for the bond."

DePalma said an obscure 1930 law requires a public vote to create a utility company which allowed the township to get the bond.

Until Monday night, the township residents had owned 49 percent of the 52 mile natural gas pipeline while Consumers retained 51 percent since the project started.

"We covered the township corner to corner with very few exceptions," said Tom Begin, east regional manager for Consumers Energy who attended the township meeting. "Consumers Energy has never done a project like this before where an outside entity owns our facilities, it's unprecedented. The work came in crafting an agreement for the township to retain ownership in capital assets needed to secure a $1.8 million bond, while Consumers could have majority interest, maintain the pipeline and hold the township harmless."

Begin said the project cost was based on the forecasted number of customers.

"What occurred in Groveland Township was Bob (DePalma) made natural gas available in one project and provided the option of hook-up to all," he said. "Typically in rural communities, groups of neighbors would call in and if there's enough to make it cost effective we (Consumers) move forward with a gas line project. What made the Groveland project so unique was the whole township took responsibility for the project. When the project started in August of 1999, Consumers received from the township the check for $1.8 million—on Monday night that bond was paid off."

Participating residents paid the bill for service of $3,100 over 15 years, about $200 per year for each hook-up. It was adjusted to $3,300.

Township residents can still hook on to the natural gas pipeline by calling 989-466-4206. Call now to have gas before next winter.

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