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Editorial: Greening PGW

A small price to pay

Philadelphia Gas Works' ambitious conservation proposal would have the same impact as taking 200,000 cars off the city streets each year. What's not to like about that?

Plus, it would boost Philadelphia's emerging green economy with immediate jobs and spin-off spending.

But the conservation plan calls for patience from most PGW customers. They'll have to wait to see much difference in their monthly bills.

The goal is worthy: to help the city's poorest households and others waste less energy through various weatherization efforts and upgrading to high-efficiency appliances.

Eventually, the resulting cost savings could ease the burden for the thousands of other PGW customers, whose bills are padded by nearly 20 percent - or $277 a year - to subsidize low-income gas users.

In the short run, though, the program as proposed to the state Public Utility Commission (PUC) will raise all customers' bills slightly.

PGW seeks permission for an annual surcharge of nearly $6 for the average residential customer to help cover the $54 million, five-year initiative aimed at helping more than 85,000 customers use less gas.

That's not much of a bite, but consumer advocates who applaud the conservation effort say they'll have to chew over the surcharge.

Irwin A. "Sonny" Popowsky, Pennsylvania's consumer advocate, says, "You want PGW doing whatever it can to help its customers reduce their bills and save gas." But Popowsky wants to make sure any rate hikes are fair - and that's reasonable.

One twist to the surcharge is that it's meant to compensate the utility for some expected losses in revenue due to selling less gas once the conservation measures are taken.

Why shouldn't customers reap all of the conservation savings? Because the perennially cash-strapped utility needs to be assured of enough revenue to cover critical maintenance. It's in the customers' interest - and the safety of everyone in Philadelphia - that PGW is left with the money it needs to keep its gas lines safe.

Well-regarded management, under PGW chief Thomas E. Knudsen, is in a good position to operate the utility, but efforts must continue to run it as leanly as possible.

At six bucks a year, the cost to customers of the conservation program hardly seems like a deal breaker. PGW could cushion the impact by winning a share of federal stimulus spending. The city is in line for a hefty $14 million in energy and weatherization grants from the feds, the Obama administration announced last week. As a city-owned utility, PGW ought to be first in line.

A PUC-mandated conservation program being rolled out by PECO Energy Co. this summer also could help PGW customers, inasmuch as PECO will be offering some of the same weatherization assistance.

Many PGW customers live in such badly insulated houses that, as one utility executive said, they "could turn the thermostat to 55 degrees and still use more than the average . . . because the heat goes through the roof and the windows."

Getting to work on sealing up the homes of PGW's poorest customers - who use almost 50 percent more gas, on average - is something that consumer advocates have sought for years. Now is their chance.