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    New York Utility Limiting New Gas Connections

Summary

Lack of new pipeline capacity seen as the problem

by: Dale Lunan

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New York Utility Limiting New Gas Connections

The reluctance on the part of New York state regulators to issue permits required for new pipeline projects came home to roost in March for Consolidated Edison, New York City’s largest gas utility, as it implemented a moratorium on new natural gas connections in much of Westchester County, the US Energy Information Administration (EIA) said May 22.

Con Edison currently serves some 3.5 customers, but it won’t be attaching any new meters because it can’t guarantee uninterrupted service given the lack of new pipeline capacity into New York state, the EIA said.

“Despite an increase in natural gas production in the Northeast, regional demand for natural gas – driven both by population growth and switching from heating oil – has grown even faster, causing concern about the ability to provide service to new customers,” the EIA said. “During recent winters, natural gas utilities in the Northeast have been using most, if not all, available pipeline capacity to transport natural gas to demand centers.”

Interstate pipelines serving the US Eastern Seaboard – largely with gas from the prolific Marcellus shale gas regions in Pennsylvania and Ohio – have long complained about New York state regulators dragging their heels in issuing water quality certifications for new pipeline projects. To alleviate some of those concerns, Con Edison has been actively pursuing compression expansions to existing capacity – projects that don’t require state water permits.

In April, the EIA said, the utility reached a deal with Kinder Morgan’s Tennessee Gas Pipeline to bring additional capacity to Westchester County.

“Under the agreement, Tennessee Gas Pipeline would provide the increased natural gas capacity to Con Edison’s distribution system in Westchester by upgrading compression facilities on its system outside of New York state,” the utility said in an April 24 statement. “Once completed, this reasonable, low-impact solution will provide Con Edison with the natural gas capacity needed to lift the current moratorium on new gas hookups in Westchester County.”

And earlier this month, the utility reached a similar agreement with Iroquois Gas Transmission that would see new compression added to the Iroquois system to help move more gas to Con Edison’s customers. Neither project, however, will be completed until late 2023.