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New York Natural Gas Services Expansion Eyed

Responding to Gov. Andrew Cuomo's Energy Highway Blueprint, the New York State Public Service Commission (PSC) last week said it would study expanding natural gas delivery to homeowners and businesses in the state. The PSC also acted on items designed to ease transmission congestion to meet power needs by providing downstate New York access to lower-cost power, and to plan for possible major power plant retirements.

The items were highlighted in a plan first outlined in Cuomo's 2012 State of the State address and laid out in more detail last month by the state's Energy Highway Task Force. The plan calls for the addition of up to 3,200 MW of electric generation and transmission capacity and clean power generation through up to $5.7 billion in private investments.

While the plan focuses on electricity generation and renewable energy sources, it also calls for an examination of barriers to the expanded use of natural gas service by residential and business customers and measures to reduce or eliminate potential barriers.

"The commission will review regulations and policies that may unduly constrain the availability of natural gas and/or other factors influencing customer conversions," the PSC said Tuesday. "Given the very substantial price difference between natural gas and oil, many residential, commercial and industrial customers could potentially benefit from conversion from oil to natural gas."

The PSC also began a proceeding to review proposals from utilities and private developers for new transmission lines and upgrades to existing facilities that would address congestion on the transmission system between Utica and New York City. It began another proceeding to develop a contingency plan in the event of a closing of the Indian Point nuclear power facility in Westchester County, approximately 30 miles north of Manhattan.

"In light of the catastrophic devastation caused by Hurricane Sandy [see NGI, Nov. 5], improvements envisioned by the governor's Energy Highway initiative will help create a stronger, more resilient energy infrastructure network that is better able to deal with the possible impact of future storms," the PSC said.

A year-long study of New York City's energy infrastructure recently found that upgrades to natural gas services are critical for the city to prepare for huge supply and demand growth over the next two decades (see NGI, Sept. 3). Close to 57% of the city's energy use today is fueled by natural gas, "either directly through on-site combustion to heat and cool buildings, or indirectly through the use of gas at power plants to generate electricity," according to the study.

In October the Federal Energy Regulatory Commission upheld an order approving the New Jersey-New York Expansion Project, which would provide an additional 800 MMcf/d of transportation capacity into the region (see NGI, Oct. 22; May 28). The $1.2 billion expansion, which would run from New Jersey into Manhattan, had been the target of repeated attacks from top New Jersey officials -- Republican Gov. Chris Christie, Democratic Rep. William Pascrell and Jersey City Mayor Jerramiah T. Healy (see NGI, Jan. 24, 2011), but it has received solid support in New York (see NGI, Nov. 7, 2011).

The effort to bring more natural gas to the New York City area received a boost of sorts last week when President Obama signed a bill that allows for the construction and operation of natural gas pipeline facilities in the New York portion of the Gateway National Recreation Center, a 26,600-acre National Recreation Area in the Port of New York and New Jersey.

HR 2606, which was introduced last year by three congressman representing Brooklyn and Queens -- Republicans Michael Grimm and Robert Turner, and Democrat Gregory Meeks -- was approved by the House and Senate earlier this year. The legislation will allow a new pipeline to be built off of an existing Williams pipeline to replace a 40-60 year old pipe and bring natural gas from New Jersey to Long Island. The pipeline will pass under Jacob Riis Park in the Rockaways portion of Queens and under Jamaica Bay to a new meter and regulator station on Floyd Bennett Field in Brooklyn.

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