Last Friday the Federal Energy Regulatory Commission (FERC) issued a final approval for Williams’ Northeast Supply Enhancement (NESE) pipeline project by a vote of 3-1 (full copy below). The only remaining regulatory hurdles are for both New York State and New Jersey to issue federal Clean Water Act 401 certificates to allow the project to cross bodies of water in their respective territorial waters. All eyes are now on NY Gov. Andrew Cuomo and what he will do. Will he approve the project, benefiting New York City and Long Island with much-needed gas? Or will he veto the project, harming millions of NY residents, simply to placate a small group of very vocal radical leftists who pretend to care about the environment? He has until May 16 to decide.
The $926 million NESE project will increase Transco pipeline capacity and flows heading into NYC and other northeastern markets. In particular, Williams wants to provide more Marcellus natural gas to utility giant National Grid beginning with the 2019-2020 heating season.
National Grid operates in New York City, Rhode Island and Massachusetts. Without this project, the NY metro area is royally screwed (see National Grid Keeps Promise, No New NYC Gas Customers).
There are a number of components to NESE, but the key component, the heart of the project, is a new 23-mile pipeline from the shore of New Jersey into (on the bottom of) the Raritan Bay–running parallel to the existing Transco pipeline–before connecting to the Transco offshore. Most of the pipeline is under water.
All of the sitting FERC Commissioners, except for Dick Glick (radical Democrat) voted in favor of approving the project. Glick, a political hack sponsored by NY’s Sen. Chuck Schumer, automatically and without fail votes against every single new natgas pipeline project on the basis the commission doesn’t consider mythical man-made global warming when approving such projects. President Trump needs to find a way to get rid of Glick.
Here’s the good news from Williams about the approval:
Williams (NYSE: WMB) today reported that the Federal Energy Regulatory Commission (FERC) has issued a certificate of public convenience and necessity authorizing the Northeast Supply Enhancement project – an expansion of the existing Transco natural gas pipeline designed to serve New York markets in time for the 2020/2021 winter heating season.
The Northeast Supply Enhancement project will provide 400,000 dekatherms per day of additional natural gas supply to National Grid – the largest distributor of natural gas in the northeastern United States. National Grid is converting about 8,000 customers per year from heating oil to natural gas in New York City and Long Island. The Northeast Supply Enhancement Project is critical to make these conversions possible, as well as keep up with new development in the area.
“Natural gas is a critical component of the mix of energy sources necessary to meet the region’s growing energy needs and to help meet its aggressive clean air goals,” said Williams Chief Operating Officer Micheal Dunn. “We appreciate the Commission’s thorough review of this important infrastructure enhancement project, which will help ultimately advance New York City toward meeting the statewide carbon emissions goals outlined in the New York State Energy Plan.”
“NESE will provide access to critical supply to serve our customers in New York City and on Long Island, ensuring there is enough natural gas for them to heat their homes and run their businesses,” said National Grid New York President John Bruckner. “This project aligns with our 80×50 pathway to reduce greenhouse gas emissions and supports City and State clean energy goals, while improving safety, reliability, resiliency and maintaining affordability and customer choice.”
The Order issued by the Commission concludes a nearly three-year regulatory review process, ultimately determining that the Northeast Supply Enhancement project will serve the public interest and that environmental impacts would be minimized with the implementation of mitigation measures proposed by the company and FERC.
Following the receipt of all necessary regulatory approvals, Williams anticipates beginning construction on the Northeast Supply Enhancement project facilities in the fall of 2019.
Transco is the nation’s largest-volume interstate natural gas pipeline system. It delivers natural gas to customers through its approximately 10,000-mile pipeline network whose mainline extends nearly 1,800 miles between South Texas and New York City. The system is a major provider of cost-effective natural gas services that reach U.S. markets in 12 Southeast and Atlantic Seaboard states, including major metropolitan areas in New York, New Jersey and Pennsylvania.
About Northeast Supply Enhancement
The Northeast Supply Enhancement project will expand existing Transco pipeline infrastructure in Pennsylvania, New Jersey and New York primarily by ‘looping’ – placing new pipe alongside of existing pipe parallel to the existing right of way. The project facilities consist of approximately 10 miles of 42-inch pipeline looping facilities, three miles of onshore 26-inch looping facilities, 23 miles of offshore 26-inch looping facilities, the addition of 21,902 horsepower at an existing compressor station, a new 32,000 horsepower compressor station and related appurtenant facilities.
According to researchers at the Edward J. Bloustein School of Planning and Public Policy, the design and construction of the Northeast Supply Enhancement project will generate approximately $327 million in additional economic activity in Pennsylvania, New Jersey and New York. In addition, the project will directly and indirectly generate 3,186 jobs during the construction period, resulting in an estimated $234 million in labor income.
Additional information about the Northeast Supply Enhancement project can be found at www.northeastsupplyenhancement.com. (1)
The news as reported by the Washington Examiner:
The Federal Energy Regulatory Commission managed to allay concerns about greenhouse gas emissions to issue a long-sought permit Friday to build a pipeline to move natural gas from the shale fields of Pennsylvania to utilities in the Northeast.
The regulators issued a 3-1 majority decision with two Republicans and one Democrat voting in favor of Transco’s pipeline project to connect New York and points north, furthering President Trump’s “energy dominance” agenda.
The two Republicans, Chairman Neil Chatterjee and Commissioner Bernard McNamee, voted in favor of the project’s certificate approval, which looked at a range of environmental factors, but didn’t go far enough for Democrats. Yet, despite their differences on the issue of greenhouse gas emissions, they managed to gain the vote of Democratic Commissioner Cheryl LaFleur, who concurred in full with the pipeline’s approval.
“After carefully balancing the need for the project and its environmental impacts, I find the project is in the public interest,” she wrote in her concurring remarks.
LaFleur has been the swing vote on the commission when it comes to the dividing issue of climate change in approving key projects to move much-needed natural gas into the Northeast states and in approving export terminals that are key to the Trump agenda. Her term on the commission comes to an end at the end of June, and the commission is already lacking one member.
Despite concurring with Republicans on the commission, LaFleur said the order still does not address to her satisfaction the downstream effects of greenhouse gas emissions after natural gas in the pipeline is burned. But she agreed with the order because of the sizable other benefits it would entail for the Northeast, such as displacing heating oil, which is far more polluting than natural gas.
LaFleur also conducted her own downstream analysis. She included the results of the analysis in her concurring statement, showing the project would result in a 4.7% increase in emissions for New York, and a 0.13% increase for the nation.
She also notes that the company building the pipeline attempts to account for these emission increases by calculating the amount of emissions reductions that would result from switching from heating oil to natural gas. That convinced her to concur with the commission’s order, although she thinks the commission can easily do its own analysis of downstream emissions.
Fellow Democrat Richard Glick, the only dissenting voice on Friday’s order, could not go along with LaFleur. Although he found some things laudable about the order, the commission’s lack of commitment to calculating downstream emissions was a bridge too far.
“The Commission’s refusal to consider the significance of the reasonably foreseeable indirect effects of downstream emissions is particularly vexing here because the Commission notes — without any verification — the ‘hypothetical scenario’ posited by Transco that would cause the Project to ‘more than offset net GHG emissions,’” Glick wrote in his dissenting comments.
The Trump administration has praised the commission for its ability to find breakthroughs in approving projects, despite disagreements on how it measures the effects of climate change-causing emissions.
In February, the commission approved the Venture Global Calcasieu Pass LNG natural gas export terminal in another 3-1 vote, in which Glick also dissented.
Activist groups and states opposed to fossil fuel development have succeeded in blocking many of the proposed pipeline projects on the commission’s list to approve, of which the Transco pipeline is one.
The administration argues that the pipelines would help displace the use of oil and other dirtier fuels in the Northeast, as the region is one of the nation’s most geographically constrained when it comes to energy. The region resides on the end of the supply chain that feeds the rest of the nation natural gas and other energy commodities.
The president issued an executive order in recent weeks that seeks to override state decisions that use federal clean water permitting decisions to block pipelines. The administration recently proposed a rule to open the door to using rail cars to move natural gas into the region to bypass the pipeline approval process altogether. (2)
May 16, the deadline for NY to decide, is rapidly approaching. However, don’t forget about New Jersey and its relatively new Governor, Phil Murphy (another wacky, liberal Democrat). NJ’s 401 water certificate must be filed by June 22. It’s possible Murphy will deny the project, at the risk of having Trump’s Executive Order overrule him.
We wait for both Cuomo’s and Murphy’s next moves on the pipeline chessboard.
(1) Williams (May 3, 2019) – Williams Receives FERC Certificate Authorizing Northeast Supply Enhancement Project
(2) Washington (DC) Examiner (May 3, 2019) – FERC allays climate change worries to approve pipeline to move natural gas from Pennsylvania to Northeast
Copy of FERC’s approval for NESE, issued last Friday:
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