RecoverIR™ Blog

Discussion of Discovery & Recovery of Lost Energy
Impacts of Reported Errors to DOE and EPA
Published by R. G. Lucas in EPA & DOE Reporting Errors • 1/26/2011 3:36:53 PM
If the U.S. DOE and U.S. EPA do not verify or validate the amount of "energy theft", then why should we as a nation continue collecting and presenting inaccurate information which affects our laws and the decisions of Congress?

Should we care if the information collected from the natural gas local distribution companies (LDCs) are off by 35 billion cu.ft. of natural gas per month and as a nation we have not correctly accounted for theft rates of at least 14 billion cu.ft. of natural gas per month?
• Who should care if the EIA’s documented error of 35 billion cu.ft. of natural gas per month is the heating the equivalent of 6 days of oil from Saudi Arabia per month?

• Who should care if our calculations of carbon dioxide (CO2) contributions to global warming are off by 2%-5%, without even considering the full CO2 equivalent impact of excessive natural gas leaks from leaking installations by thieves? (Who should care about the accuracy information collected under the new EPA January 2011 Rule 40 CFR part 98, Mandatory Greenhouse Gas Reporting Rule?)
• Why should the electric utilities care about errors in the natural gas consumption rates, even though RecoverIR found that 94% of the homes in Detroit stealing natural gas were also stealing electricity? (Most modern furnaces require electricity to run the blower motors, so electricity is required to keep most homes warm if the natural gas is stolen.)

Should we attempt to quantify or validate what is really contributing to the 35 billion cu.ft. of natural gas per month error?

The U.S. Department of Energy’s Energy Information Administration (EIA) released a special report on 4 June 2010 which clearly identified a (natural gas) difference of “around 35 billion cubic feet per month”.
Examining the Updated EIA-857 form, you should note (1) there is no provision for reporting the volume of natural gas stolen by residential, commercial or industrial customers bypassing installed natural gas meters and (2) there is no provision for reporting natural gas stolen by thieves who are not customers.

Figure 1 - Updated EIA-857

Additionally, the volume reported on the Updated EIA-857 form requires volumes reported in Mcf at 14.73 psia-60 degrees Farenheit, even though nearly all residential and commercial natural gas meters provide neither temperature nor pressure compensated readings, and nearly all of the installed meters have never been calibrated since they were installed. All of these variances allow significant errors in the reported volumes, which if not verified or validated, will lead to inaccurate summary values.

Let’s dig a little further.

On the EIA website, the EIA described the adoption of new “Corrective Measures” in 2010-2011 in an effort to explain away the (balancing) errors in an article “Seasonality in the Natural Gas Balancing Item: Historical Trends and Corrective Measures” and provided values in a spreadsheet “volume_comparison.xls” (U.S. Natural Gas Residential Comsumption Comparison) comparing the “Residential Volume - Current Method (MMcf)” with the “Residential Volume - Prior Method (MMcf)” for the months of October 2010, September 2010 and August 2010. Extracted highlights from that information are summarized below along with the approximate average temperatures in Michigan in late 2010:

Conclusions from the Table Above:
• As the average ambient temperatures go down, without compensating for energy theft, the error rated associated with the “Prior Computation Method” goes up and the only way the EIA could correct for the errors without considering the actual “energy theft rate” is to use the “New Computation Method.”
• As the ambient temperature goes down with each successive month toward the coldest months of the winter, the natural gas useage will go up and the error rate associated with the “Prior Computation Method” continues to go up. The “New Computation Method” can easily mask, energy theft rates.
So why are the LDCs not reporting the actual theft rates in their service territories?
We believe the true reasons for not aggressively pursuing natural gas and electricity energy theives are hidden among the following excuses given by revenue protection and energy theft department managers we have talked with:
• My department doesn’ t have any budget to pursue energy thieves.
• I need more boots on the ground to investigate all of the energy thieves detected by RecoverIR, and my managers do not want to spend the money.
• We don’t think we have very many unidentified energy thieves in our service territory. No, and we don’t want to look.
• Even though RecoverIR is willing to look for energy thieves on a performance based contract with no money up front, we are afraid of you finding too many energy thieves and we cannot follow-up.
• Our utility is afraid to be perceived as a very bad company which turns off the heat of poor people.
• Because of our unions, we cannot even send out an invesigator with a camera, without an engineer, and take pictures of the violations.
• Even when our own employees find violations, there are so many energy thieves, the reported violations by our employees goes to the bottom of the action list, because we don’t have the people to follow-up. We follow-up first on the tips from police and citizens.
• Since the independent natural gas suppliers are providing a growing amount of the gas and our profitability as an LDC is set by the public utility commission (PUC) for our distribution and bill collecting services, we as the LDC do not have any real financial incentive to go after energy thieves.

Our overall conclusions:
1. Even though the dollar value of energy stolen places the energy theft in the category of “grand theft” in most jurisdictions, the utility companies seem to have little incentive to eliminate the theft.
2. The bill paying customers will remain the losers as long as utilities do not stop energy thieves.
3. Communities and cities have to waste money on unnecessary fires, explosions, and emergency situations because the utilities are allowing most of the unsafe electrical theft and natural gas theft conditions to continue unabated, and growing.

You be the judge. What should be done?