On appeal from Final Order of the Board of Public Utilities.
King, Deighan and Muir. The opinion of the court was delivered by Muir, J.A.D.
Petitioner Village of Pine Run appeals from a Board of Public Utility's decision which adopted an Administrative Law Judge's determination that Respondent South Jersey Gas Company properly refrained from undertaking individual gas service metering at petitioner's apartment complex in Gloucester Township. Petitioner contended before the ALJ that respondent violated (1) N.J.S.A. 48:3-2 by adopting unreasonable regulations, (2) N.J.S.A. 48:3-3 by withholding reasonably demanded service, and (3) N.J.S.A. 48:3-4 by subjecting petitioner to undue prejudice or disadvantage.
The BPU, in adopting the ALJ's decision, stated:
The Board concurs with the Administrative Law Judge's findings that South Jersey properly refrained from undertaking individual gas service metering at the Pine Run apartment complex because of the numerous safety questions which remain unresolved. The Board agrees with the company's contention that the issues of safety are a permanent concern and in this case transcend conservation savings which normally follow the conversion from master to individual metering.
The controversy between the parties centered on the transmission lines used to provide natural gas to petitioner's apartment. Service lines, those lines before the customer's meter, are the responsibility of the utility. Fuel lines, those lines downstream or after the meter, are the responsibility of the customer. Conversion to individual metering, by the fact that it moved the meters to points downstream from the prior master meter location, converted fuel lines to service lines.
Petitioner, being responsible for the cost of any conversion, sought to have the respondent take over the existing fuel lines
which became service lines by virtue of the conversion. Respondent refused to do so unless the petitioner upgraded the fuel lines to meet respondent's safety standards, which are higher or more restrictive than existing federal or state requirements.
On appeal, petitioner abandons the challenge raised before the ALJ. It concedes the ALJ's findings and conclusions adopted by the BPU. Instead, petitioner now argues the respondent may not set higher safety standards than the minimum federal pipeline safety standards set by regulations of the U.S. Department of Transportation adopted pursuant to the Natural Gas Pipeline Safety Act of 1968, 49 U.S.C.A. § 1671 et seq. (West 1976).
It argues that the minimum standards are binding on respondent, that only the BPU can enact more stringent standards and that in allowing respondent to utilize more stringent standards the BPU delegated its rule-making power to the respondent in violation of the Administrative Procedures Act. N.J.S.A. 52:14B-1 et seq.
Petitioner, a cartel of four limited partnerships with one man as a general partner of each, owns a 699-apartment complex. The complex has 177 townhouse-styled apartments that are individually metered. It also has 522 traditionally styled apartments that are currently master metered. Petitioner seeks to convert these units to individual metering.
All 522 units and buildings in which they are located are provided natural gas in the same manner. A service line runs from the street to the master meter. Fuel lines then leave the meter, go into the ground and go through the foundation wall of the apartment building into a laundry room where there are hot water heaters and clothes dryers. The fuel lines then run through a crawl space (except for a dozen buildings which have no crawl space with lines apparently running under the floor) and branch off to apartment gas ranges. From there, the fuel lines extend through another crawl space to the rear of the
building where they branch off to heating units in the apartments.
The ALJ made the following findings with respect to the fuel lines:
*fn1 14. The respondent has a policy not to accept fuel lines as service lines.
15. The respondent has a policy requiring welded joints on service lines.
16. The respondent has a policy to encase lines running ...