The developers of the proposed Access Northeast pipeline expansion are moving “full-speed ahead” despite a state supreme court ruling last week that invalidated the project’s capacity contracts in Massachusetts.
This week, New England electric distribution companies (EDC) Eversource Energy and National Grid filed motions to withdraw earlier proposals submitted to the Massachusetts Department of Public Utilities (DPU) that would have allowed them to sign up for capacity on Access Northeast and recover the costs through rates. Those proposals, approved by the DPU, were ruled illegal last week by the Supreme Judicial Court (see Daily GPI, Aug. 18).
Eversource and National Grid have signed on to co-develop Access Northeast with Spectra Energy. The project, Spectra’s proposed solution to the winter capacity constraints that have caused price spikes in New England in recent years, would serve electric generation demand by adding roughly 900,000 Dth/d to Spectra-affiliate Algonquin Gas Transmission LLC’s system primarily through brownfield expansion.
The overturned contract proposals would have seen Eversource and National Grid release their firm transportation capacity on Access Northeast directly to electric generators or back into the market. The project’s backers proposed the arrangement as a workaround for adding capacity to serve gas-fired power generation when generators themselves have little incentive to commit to long-term firm transportation.
Spectra spokesman Creighton Welch said via email that the Massachusetts ruling will not prevent Access Northeast from moving forward.
“Without targeted expansion of natural gas pipeline capacity, New England energy consumers will inevitably bear the brunt of ever-increasing energy prices and ever-diminishing supply reliability,” Welch said.
“For this reason, we have put the Court’s decision behind us. We remain firmly committed to our part in solving New England’s energy challenge. There is a sizeable need for natural gas throughout New England that is unabated by the Court’s decision. To date, each participating state jurisdiction is progressing independently with its own process to approve contracts for the Access Northeast Project and these processes are unaffected by the Massachusetts process.
“Therefore, our path forward is clear and our mission to reestablish the Massachusetts contribution is full-speed ahead. We are confident that, ultimately, the interests of New England’s consumers will prevail with desperately needed gas supply made available by Access Northeast.”
Access Northeast’s backers have also been working to get the EDC capacity release proposal approved by FERC in the form of a tariff revision (see Daily GPI, June 29).
Other regional energy players, including Engie Gas & LNG LLC, a plaintiff in the Massachusetts case, have opposed Access Northeast’s plan as anti-competitive, while proponents have said the expansion will improve reliability and save ratepayers money (see Daily GPI, June 13).
Engie, in opposition to the Algonquin tariff revision, filed a motion to lodge the Massachusetts ruling with the Federal Energy Regulatory Commission this week. The court’s ruling “invalidated the approval for the very contracts supporting the asserted need for the tariff changes,” the company wrote.
Access Northeast is not the first New England-directed pipeline project to run into problems recently. Earlier this year, the state of New York denied a water permit to Constitution Pipeline LLC that has stalled the Pennsylvania-to-New York project (see Daily GPI, April 25).
Around the same time, Kinder Morgan Inc. cancelled Tennessee Gas Pipeline Co.’s Northeast Energy Direct project, citing the region’s lack of established regulatory procedures to facilitate binding EDC commitments as a factor (see Daily GPI, April 21).
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