Eighth Annual DCA & AGA Workshop Held in Kansas City

DCA and the American Gas Association (AGA) held the eighth annual DCA & AGA Workshop at the InterContinental Kansas City, Kansas City, Missouri, on March 18-20, 2024. 

The joint workshop was established to bolster communication and cooperation between local distribution companies (LDCs) and the contractors who build gas distribution infrastructure for them. At a time when America is in the midst of the largest infrastructure buildout in history and recognizing that the vast majority of construction work is contracted out, ensuring strong relationships between LDCs, other facility owners, and contractors is more important than ever.

The 2024 workshop brought some 140 industry representatives to Kansas City for a day and a half of presentations and panel discussions on a range of industry issues, including:
• Underground damage prevention
• State-of-the-art facility mapping
• Operator qualification
• Pipeline safety management systems (SMS)
• Cyber and physical security
• Workforce development efforts in the gas distribution industry.
• Legislative and regulatory activities facing the industry at the state and federal level

PHMSA Kicks Off Workshop with Strong Messages of Partnership, Safety Culture
Following introductory remarks and a “safety moment” by industry representatives from the utility sector and the contracting community, Massoud Tahamtani, Deputy Associate Administrator for Policy and Programs of the U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA) provided an overview of the nation’s pipeline safety program. PHMSA is responsible for regulating more than 2.3 million miles of natural gas and hazardous liquid pipelines through development of safety regulations, research and development, strong enforcement, and working with several industry organizations on a range of safety initiatives.

PHMSA’s presentation focused on excavation damage prevention, which continues to be one of the leading causes of pipeline failures. PHMSA works with its state partners and other organizations such as the Common Ground Alliance (CGA) to advance damage prevention effectiveness at both the federal and state level. According to PHMSA, “taking this responsibility seriously is particularly important now that, through the Bipartisan Infrastructure Law, thousands of infrastructure projects are underway in every state and territory that will serve to bolster our economic security and prosperity for decades to come.”

Public utility commissions and other entities that oversee state damage prevention programs can apply for several sources of federal grant dollars intended to help improve state efforts to reduce damages, such as PHMSA damage prevention grants, technical assistance grants, and base grants. Because of the importance of protecting underground facilities, PHMSA encourages states to take advantage of these resources to implement several elements deemed necessary to maintain an effective state damage prevention program.

Although the “blame” for excavation damage is often unfairly assigned to the excavator, PHMSA’s presentation noted the responsibilities of the facility operators and the contract locators who work for them. Compliance with damage prevention responsibilities is fundamental to complying with Distribution Integrity Management Program (DIMP) requirements, but PHMSA described another problem in the damage prevention process – the overburdening of contact locators with unrealistic numbers of 811 tickets to clear in a short timeframe.

Assigning unworkable numbers of tickets to already overworked locators results in mismarked facilities, late marking, or even no marking of some facilities at all. This leads to contractors calling in too many tickets for one simple reason: they don’t know what is going to be located and located on time. More effective ticket scheduling is needed, and increased communication between operators and contractors will be key to solving the problem. It was suggested that bringing contract locators into these initial discussions should be considered.

PHMSA also believes that instilling and maintaining a culture of safety is critical. Operators should consider communicating their expectations regarding safety management systems (SMS) with their contractors sooner rather than later. PHMSA also recognizes the need for effective damage prevention as federal dollars from the bipartisan infrastructure law continue to flood into several underground infrastructure markets.

OQ Integrity Coalition Advancing Pilot Programs
The Operator Qualification Integrity Process (OQIP) is an industry effort spearheaded by DCA and AGA with the goal of standardizing OQ processes while raising the bar on pipeline integrity. The process has been integrated and tested in three initial pilot programs in New Mexico, Michigan, and Washington state. A panel of gas utility operators running these pilots provided an update on the progress and challenges they’ve experienced while working to continuously improve their OQ programs.

Following background on the OQIP and the progress made since the coalition was established 10 years ago, the panel discussed what the coalition refers to as ‘phase 2.’ This will consist of an evaluation of lessons learned during the pilots and how to expand participation in OQIP pilot programs or encourage implementation of OQIP approaches in existing OQ programs.

Panelists focused on several common themes: 
• The need to standardize OQ factors to the extent possible while understanding the “80/20” ratio of common covered tasks versus operator-specific OQ activities.
• The importance of both internal and third-party audits.
• The increasing importance of implementing SMS approaches related to operator qualification.
• The strong interest in maintaining OQIP practices long term.
White papers on each of the current pilots are provided on the OQIP website (oqip.org. The OQ Coalition looks forward to advancing the OQIP as the coalition confirms its governance and plans for next steps. Interested parties are encouraged to contact DCA or AGA for more information.

Significant Progress Related to Pipeline SMS 
Since the release of API Recommended Practice 1173, Pipeline Safety Management Systems, in 2015, the pipeline industry has done a lot of great work to voluntarily transition toward the top-to-bottom, cyclical process of ensuring continuous improvement in the safety of pipeline operations. In 2020, the Pipeline SMS Industry Team invited contractors to the table, and progress has been made on several fronts. DCA’s SMS “template” was distributed to several industry groups, and the association helped develop the Industry Team’s contractor guidance document. DCA is now participating in multiple assessments of their own SMS programs and approaches. 

Contractor Assessment Programs
A panel of contractors and operators discussed the contractor role in Pipeline SMS and the Industry Team’s recent release of its “Contractor Assessment Tool,” as well as the best ways contractors can learn more about implementing an SMS program. The chief operating officer of a leading utility contractor enthusiastically described how contractors now have a real voice in the SMS discussion and how the contracting community appreciates the Industry Team inviting a DCA member to serve as vice chair of the Industry Team. Implementation of SMS is now happening in a collaborative way.

The panel discussed efforts to revise and release the next edition of API RP 1173, especially regarding if and how to provide more content related to contractor SMS. Operators on the team understand that API 1173 is directed at pipeline operators, and that some of elements related to quality management systems (QMS) might be appropriate when considering contractor SMS.

With the help of gas distribution contractors, the team was able to take 56 key “shall statements” from the 234 included in API RP 1173. Depending on a contractor’s scope of work, operators can focus on these 56 “shall statements” while ensuring alignment with their SMS program. Following release of the contractor guide, the Industry Team produced a tool aimed at helping contractors gauge their own implementation of SMS approaches.

The Industry Team’s contractor assessment program is providing contractors the opportunity to work with operators to evaluate where they are in terms of the maturity of their SMS program. Establishing a culture of safety throughout the company is fundamental, and contractors were encouraged to “start now – don’t wait” when it comes to looking at SMS and to ask customers about their expectations regarding SMS approaches in pipeline construction.

The Industry Team looks forward to reviewing the pending investigation and report expected from the National Transportation Safety Board (NTSB), and will develop a response to NTSB, depending on the board’s findings and possible safety recommendations. A report on implementation of SMS in the industry is also expected from PHMSA. In the meantime, there are resources on the Pipeline SMS website (pipelinesms.org) to provide contractors more information on the Industry Team’s work and all resources available to both contractors and operators.

Perspective from an LDC
Later in the workshop program, a project manager from a leading gas utility described his company’s  journey toward effective pipeline safety management. SMS has a proven track record in other industries such as aviation, nuclear power, and chemical manufacturing, and is being effectively implemented in the pipeline industry. This operator integrated SMS approaches in the company’s Operational Excellence Program, and now has the company’s entire SMS team working on implementation, including utilization with contract personnel.

An original gap analysis set the stage for this operator, which led to setting up an SMS framework and process to assess the maturity of their SMS in the future. While human error is inevitable, operational excellence should strive to exceed expectations of customers, regulators, and other stakeholders. SMS can and should be a big part of that.

Priorities for this operator included: ensuring for fully trained and qualified personnel; use of ‘train-the-trainer’ and on-the-job training; centralized oversight of key procedures, continuous communication with all relevant workers, and elaborate performance reviews; updated inspection manuals and reliable equipment; and robust reporting and opportunities to provide feedback. Monitoring the company’s safety culture and developing a work risk matrix were also described by this operator.

To say the least, sentiments about the need to instill and maintain a strong safety culture and to continue the transition to SMS in the industry were shared by operators and contractor panelists alike.

Leadership Development Helps Address Workforce Capacity Challenges
The gas distribution construction industry continues to face serious workforce capacity challenges and there doesn’t seem to be any light at the end of the tunnel. If quality candidates interested in working in the energy sector are not able to secure a job based on their existing qualifications, they will go elsewhere and our industry will miss opportunities of adding quality workers to a struggling workforce. A panel of DCA’s Workforce Development Committee provided a lively discussion of how the industry can come together to increase opportunities to bring talent into the workforce through the “sharing” of candidates.

The energy and construction industries continue to face an aging workforce, a mismatch of needed skills, and a general decline of interest in some quality careers. Supply chain challenges that were more than disruptive following the pandemic, uncertainty over available child care, lack of flexible work schedules, anxiety over available transportation, and other concerns have led to certain positions remaining open for prolonged periods of time.

This panel asked the question: can and would employers share information regarding potential workers through “talent sharing?” Specifically, sharing of information about job candidates in a collaborative way among competing companies and even the associations that represent them. Can associations serve as repositories of this shared information through creation of a joint website and/or other venues?

The concept of talent sharing was well received, although full transparency will be needed in the process. In addition, possible benefits and challenges will need to be fully discussed. At the very least, this panel on workforce development provoked significant discussion on an enduring problem.

Legislative and Regulatory Challenges 
This year, Congress and the Biden regulatory agencies are considering several legislative and regulatory actions impacting the gas distribution industry. A leading industry lobbyist representing gas utilities provided the lay of the land for the energy industry on Capitol Hill at essentially “halftime” in what is shaping up to be an undoubtedly consequential election year.

Workshop attendees were not likely surprised to hear that not much in terms of legislative productivity is expected this year, when a historic rematch of two unpopular presidential candidates and an unquestionably toxic environment in Congress will exacerbate the already slim chances of anything substantial passing in the remaining months of the 118th Congress. For our industry, the ongoing attack on the natural gas industry is expected to continue. At the same time, tens of thousands of new gas distribution lines are being built, the industry has reduced emissions by some 70%, and demand, production, and storage of natural gas continue to increase.

The fight over “fuel choice” versus banning or restricting access to natural gas and other fuel sources continues. States are talking about gas bans, but demand is still rising in “problem” states such as New York. Gas and electric coordination is a factor, and the Biden Administration’s regulatory agenda continues to threaten the future of natural gas, despite steady or increasing demand. Permitting processes are not getting any easier, and the president’s shortsighted ban on liquified natural gas exports is adding insult to injury.

Pipeline safety legislation is currently being considered in the House, but different approaches are being employed. One House bill is bipartisan and would likely pass while another is considered much more partisan. The Senate has yet to introduce its version of pipeline safety reauthorization legislation.
The key takeaway: This industry faces multiple challenges, but a strong gas distribution market will be needed for the foreseeable future.

CGA/DPI Presentation
Damage prevention is a common topic at these workshops, and both DCA and AGA are strong supporters of the Common Ground Alliance (CGA). In recent years, CGA’s Damage Prevention Institute (DPI) created an innovative opportunity for the industry to address systemic inefficiencies in the damage prevention process through a metrics-focused, peer-reviewed model of shared accountability that serves all stakeholders.

The creation of the DPI was announced in April 2022, and was formally launched in January 2023. DPI’s mission builds on the industry-leading insights of CGA’s Next Practices Initiative. Its mission also uses a stakeholder-centered approach to develop performance metrics that reflect commitment to CGA best practices and dedication to improving damage prevention.

CGA has more than 1,500 members and 16 stakeholder groups and promotes shared responsibility in damage prevention. Priorities include excavation data collection, promoting innovative technologies, and identifying and promoting existing damage prevention best practices. CGA also launched its “Next Practices” initiative, where future issues, practices, and technologies are evaluated.

Seventy-six percent of all damages are caused by six root causes: no notification to 811 by the excavator; facilities not marked due to locator error; failure to verify and/or maintain facility marks; mismarked facilities; improper excavation; and problems associated with potholing. While CGA is embarking on an effort to reduce damages by 50% in five years, damages are currently increasing. The industry is in dire need of better mapping of underground facilities.

CGA provided specifics regarding DPI. Excavators represent the largest stakeholder group in CGA, and most are now participating in DPI activities. Eligible participants must agree to adhere to multiple requirements, including: 
• Comprehensive accreditation 
• Monthly reporting into CGA’s Damage Information Reporting Tool (DIRT)
• Participation in DPI peer reviews.

Cybersecurity and On-Site Security in the Gas Distribution Industry
Since the Colonial Pipeline cyberattack, the issue has been front and center at industry conferences. AGA provided a thorough description of cybersecurity challenges and what industry is doing to address physical threats to pipeline infrastructure. 

The old adage of “the adversary only needs to be right once, but defenders must be right all the time,” is  relevant here, and no contractor or utility is too small to be targeted. Bad actors continue to take advantage of lax cyber and physical security measures in all sized companies to gain access to critical energy system infrastructure and information. (Occasionally, though, impacted facilities may not have been the intended target.)  Although it’s not realistic to be fully physical and cyber secure 100% of the time, actions can be taken to minimize the impact of an attack and make a measurable difference for utilities and their customers.

It’s important to remember that the main prize of cyberattacks is no longer intellectual property; it is causing service disruption. Cyber ‘adversaries’ are looking to engage systems under the guise of being an employee, and they want to attack when least expected. Cyber physical attacks are on the rise, and regulation is widely expected. In other sectors subject to federal cybersecurity requirements, contractors and subcontractors are having to move toward cyber certification. This could be burdensome, but understanding the increased threats to the security of critical infrastructure, it is an issue industry should be mindful of.

GIS in the Pipeline Industry
As discussed in several of the sessions on damage prevention, underground facility mapping is in dire need of improvement. Use of technologies like geographic information systems (GIS) is gaining attention in multiple industries, including the gas distribution sector.

Barb Cederberg of Gopher State One-Call gave a presentation about a promising pilot program established to improve the 811 process through digital visualizations of underground facilities using GIS mapping. The Minnesota Utilities Mapping Project (MN UMP) was developed by Gopher State One-Call (GSOC) and the Minnesota Geospatial Advisory Council. The goal was to create a revolutionary process that would allow damage prevention stakeholders to access underground utility maps by leveraging widely accessible technology while also protecting sensitive information about a given pipeline’s specific location. 

The MN UMP began in 2019 and has been a case study monitored by CGA since 2020. GSOC worked with the advisory council to generate high-quality GIS imaging, providing real time viewing of subsurface utility systems. All viewing access and time periods allowing access are at the operator’s discretion. The pilot was completed in 2022 and GSOC is now advancing the program in Minnesota.

Impacts and Considerations: Artificial Intelligence
Continuum Capitol closed out the workshop with an insightful market overview regarding gas distribution and other sectors. According to Continuum, we stand on the precipice of the largest wave of underground utility construction activity across all utility markets over the next three to seven years. In addition, the potential for the integration of hydrogen and renewable natural gas along with CO2 capture, transport, and storage activity presents new opportunities. Of course, there are challenges and change that come with them, the most interesting of which is artificial intelligence (AI).

According to Continuum, we’re now heading toward times of “volatility, uncertainty, complexity, and ambiguity” (VUCA), and industry should be prepared for it. Geopolitical conflicts in several “hot spots” around the globe, the ongoing partisan fights over America’s energy future, and the general political landscape certainly make the case for industry stakeholders to take a hard look at VUCA considerations.
Continuum provided an entertaining video demonstrating Hollywood examples of AI from the 1960s through the 2020s, and then real-life examples of how AI, machine learning, and robotics are changing the game in terms of augmenting our existing (and struggling) workforce. While there are benefits offered by AI, from maximizing operational effectiveness to addressing workforce capacity issues, there are serious factors to consider.

All proprietary information applied in AI and machine learning will become “part of the answer.” This and other concerns related to cybersecurity, dissemination of false information, and other new ‘issues of the day’ are now key considerations. Our industry needs to pay full attention.

The DCA/AGA workshop is a unique event in the utility construction industry, and the need for strong and reliable relationships between utilities and their contractors has never been more essential. The fact that most construction operations are contracted out and that the industry faces serious workforce issues is enough to warrant these discussions. Recognizing that hundreds of billions of dollars are on the way to virtually all utility markets, we need a lot more of them.