CenterPoint Energy 2013 Annual Report Download - page 35

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13
Midstream Investments - Safety and Health Regulation
Certain of Enable’s facilities are subject to pipeline safety regulations. PHMSA regulates safety requirements in the design,
construction, operation and maintenance of jurisdictional natural gas and hazardous liquid pipeline facilities. All natural gas
transmission facilities, such as Enable’s interstate natural gas pipelines, are subject to PHMSA’s pipeline safety regulations, but
natural gas gathering pipelines are subject to the pipeline safety regulations only to the extent they are classified as regulated
gathering pipelines. In addition, several NGL pipeline facilities and crude oil pipeline facilities are regulated as hazardous liquids
pipelines. Pursuant to various federal statutes, including the Natural Gas Pipeline Safety Act of 1968 (NGPSA) the DOT, through
PHMSA, regulates pipeline safety and integrity. NGL and crude oil pipelines are subject to regulation by PHMSA under the HLPSA
which requires PHMSA to develop, prescribe, and enforce minimum federal safety standards for the transportation of hazardous
liquids by pipeline, and comparable state statutes with respect to design, installation, testing, construction, operation, replacement
and management of pipeline facilities. PHMSA has developed regulations that require natural gas pipeline operators to implement
integrity management programs, including more frequent inspections and other measures to ensure pipeline safety in high
consequence areas (HCAs). Although many of Enable’s pipeline facilities fall within a class that is currently not subject to these
integrity management requirements, Enable may incur significant costs and liabilities associated with repair, remediation,
preventive or mitigating measures associated with its non-exempt pipelines. Additionally, should Enable fail to comply with DOT
or comparable state regulations, it could be subject to penalties and fines. If future DOT pipeline integrity management regulations
were to require that Enable expand its integrity managements program to currently unregulated pipelines, including gathering
lines, its costs associated with compliance may have a material effect on its operations.
ENVIRONMENTAL MATTERS
Our operations and the operations of Enable are subject to stringent and complex laws and regulations pertaining to health,
safety and the environment. As an owner or operator of natural gas distribution systems, and electric transmission and distribution
systems, we must comply with these laws and regulations at the federal, state and local levels. These laws and regulations can
restrict or impact our business activities in many ways, such as:
• restricting the way we can handle or dispose of wastes;
• limiting or prohibiting construction activities in sensitive areas such as wetlands, coastal regions or areas inhabited by
endangered species;
• requiring remedial action to mitigate environmental conditions caused by our operations or attributable to former
operations;
• enjoining the operations of facilities deemed in non-compliance with permits issued pursuant to such environmental laws
and regulations; and
• impacting the demand for our services by directly or indirectly affecting the use or price of natural gas.
In order to comply with these requirements, we may need to spend substantial amounts and devote other resources from time
to time to, among other activities:
• construct or acquire new equipment;
• acquire permits for facility operations;
• modify, upgrade or replace existing and proposed equipment; and
• clean up or decommission waste disposal areas, fuel storage and management facilities and other locations and facilities.
Failure to comply with these laws and regulations may trigger a variety of administrative, civil and criminal enforcement
measures, including the assessment of monetary penalties, the imposition of remedial actions and the issuance of orders enjoining
future operations. Certain environmental statutes impose strict, joint and several liability for costs required to clean up and restore
sites where hazardous substances have been disposed or otherwise released. Moreover, it is not uncommon for neighboring
landowners and other third parties to file claims for personal injury and property damage allegedly caused by the release of
hazardous substances or other waste products into the environment.