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New York State Sets LNG Regulations

With the advent of more transportation use of natural gas, albeit without any added supplies from shale gas development, the state of New York on Wednesday rolled out some proposed new rules for the use and storage of liquefied natural gas (LNG). The new rules are effective Feb. 26.

New permitting requirements are to cover the siting, construction and operation of LNG facilities throughout the state. The applicable facilities include those that store or convert LNG into natural gas through vaporization, along with covering transportation of LNG, including intrastate transport requirements.

As in other states, New York recognizes that LNG can be used as a lower cost, cleaner fuel for trucking fleets (see Daily GPI, Aug. 29, 2012). The new rules would allow LNG storage facilities to be built in New York City for the first time since 1973.

The state imposed a moratorium on LNG facilities following the 1973 explosion that killed 40 workers during the cleaning of an empty LNG storage tank on Staten Island, and waited four decades to consider new rules. The state Department of Environmental Conservation (DEC) then began a public process for developing regulations for LNG facilities, a task made more challenging after receiving thousands of public comments, including many from those groups whose work has led to the state's ban on hydraulic fracturing (see Daily GPI, Dec. 6, 2013).

State officials said that the proposed rules would make New York the only state thus far to require a permit for LNG storage, which increasingly is being used as fuel for various fleets., particularly long-haul trucking fleets (see Daily GPI, March 6, 2014).

DEC officials predicted that in the first five years of the new rules applications likely would be concentrated on LNG truck refueling facilities. Increasingly, long-haul tractor-trailers and large capacity fleet trucks are using LNG as a substitute for diesel fuel.

The rules specifically exempt LNG fuel tanks used in trucks and other vehicles from the need for permitting as "intrastate" transport of LNG. It also exempts the "delivery of LNG to alleviate an emergency."

DEC used public comments it began collecting in September- December of 2013 in the final rules, which also include requirements for inspections, record keeping and training for local fire department personnel for the handling of LNG.

Intrastate shipments of LNG are not allowed, but interstate shipping of the fuel remains. Pre-existing facilities, including two operated by National Grid and a third one that Consolidated Edison has, are required to meet the new rules and regulations.

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