New York Gov. Andrew Cuomo railed against National Grid in a letter to the utility on Tuesday indicating the state intends to revoke its certificate to operate for imposing a moratorium on new natural gas service in New York City.
National Grid was given 14 days to respond to the notice, which came after months of arguments over whether there is a gas supply shortage in the city.
National Grid imposed a moratorium on new gas service earlier this year, indicating at the time that it was unable to process thousands of applications for commercial, residential and multi-family units without additional infrastructure to bring more gas supplies into the region.
“The ‘moratorium’ is either a fabricated device or a lack of competence,” Cuomo wrote in the letter. He accused the utility of failing to plan for supply needs and depending too heavily on the Transcontinental Gas Pipe Line Co. LLC (Transco) Northeast Supply Enhancement (NESE) project, which is fully subscribed by National Grid subsidiaries serving customers in Brooklyn, Queens and Long Island.
Cuomo’s administration has twice denied key permits for NESE. Transco first filed for a water quality certification for the project in 2017, but it refiled after state regulators deemed the application incomplete. Last May, the state rejected the WQC again, saying the project would result in water quality violations and fail to meet state standards.
“Considering all the risks involved in such a pipeline coming to a timely conclusion, it was incumbent upon a competent and professional utility to explore and provide contingency plans and short-term and long-term options,” Cuomo said.
National Grid has warned for most of the year that without additional infrastructure to serve the city, it won’t be able to meet increasing demand. The state has also denied other projects in recent years, such as the Constitution Pipeline, to bring more gas supply into the city. The utility is in the process of connecting service for more than 1,100 customers in Brooklyn, Queens and Long Island after the New York State Public Service Commission (PSC) directed it to do so last month.
“National Grid is in receipt of the letter from Gov. Cuomo and will review and respond accordingly within the timeframe outlined in the letter,” said spokesperson Karen Young. “We continue to work with all parties on these critical natural gas supply issues on behalf of all our customers in downstate New York.”
Cuomo noted that natural gas can be trucked, shipped or barged into the region, while “other infrastructure could be proposed or additional unloading facilities installed.” As his administration has favored alternative energy, however, it also denied the proposed Port Ambrose liquefied natural gas terminal in 2015, indicating then it would be a threat to the environment.
In an implementation plan submitted to the PSC last month, National Grid said it would better manage the supply shortage by expanding demand response and energy efficiency programs. The company has also arranged for truck deliveries of compressed natural gas (CNG), filed details for portable CNG stations and said it intended to use a higher than usual percentage of gas supply from spot commodity markets.
Under state law, Cuomo noted, a utility is granted a certificate of public convenience and necessity only if it can provide “adequate and reliable service” and the utility’s operation is “in the public interest.”
Consolidated Edison Co. (Con Ed) has also imposed a moratorium on new gas service in the suburbs of Westchester County, but it has stopped short of doing so in the city, where it shares infrastructure with National Grid. ConEd has already inked deals to expand the Iroquois and Tennessee interstate gas systems to secure more volumes for the state. Those agreements, however, wouldn't provide additional supply until 2023.