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New England Governors Announce Plan To Expand Natural Gas Use

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(Jean-Christophe/AFP/Getty Images)

(Jean-Christophe/AFP/Getty Images)

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By STEPHEN SINGER,  AP Business Writer

HARTFORD, Conn. (AP) _ New England governors announced Thursday a plan to expand natural gas use as power plants worked to shore up supplies to meet rising demand in another Arctic blast.

The governors of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont asked the region’s grid operator for technical help to seek proposals to build transmission equipment and public works to deliver enough electricity to serve 1.2 million to 3.6 million homes. The states also asked the system operator, ISO-New England, to devise a way to finance the project.

“New England’s electricity costs are not competitive,” Maine Gov. Paul LePage said. “Our high energy prices drain family budgets and are a significant barrier to attracting business investment, especially in energy-intensive industries such as manufacturing.”

As the price of heating oil has climbed, consumers and state policymakers are looking to natural gas as an alternative. Connecticut, for example, has launched a 10-year project to connect 280,000 customers.

ISO-New England praised the governors’ initiative. Pipeline bottlenecks are “limiting the supply of natural gas to power generators, which can pose a threat to power system reliability,” the grid operator said.

As temperatures plunge to between the single digits and below zero, power plants have turned to alternative sources of fuel in response to tight natural gas supplies and a spike in prices. An unusual request in New Hampshire prompted a utility to fire up costly jet fuel-powered turbines.

Plant operators at the Merrimack Station coal plant in Bow, N.H., were told Wednesday by ISO-New England to be ready to bring the giant turbines online on Thursday because the grid operator anticipated only about 25 percent of the natural gas capacity would be available. ISO-NE said many turbines were prepared to go online Thursday for the same reason.

The turbines are typically used for 10 to 20 hours in the course of a year, mostly when demand peaks on very hot or very cold days, said Martin Murray, a spokesman for Public Service Co. of New Hampshire, which operates the plant. The turbines, which have already been run more than twice that time in January, are more expensive than natural gas but made economic sense when the cost per megawatt spiked tenfold on Wednesday.

That, Murray said, points out the fragility of the energy market in New England, which has grown increasingly dependent on natural gas.

The Conservation Law Foundation, a Boston environmental group, warned that the governors’ proposal threatens an over-reliance on natural gas, a carbon-based fuel that could “potentially leave the public holding the bag for a bad bet.”

It also called on state officials to seek public comment, “rather than continuing the politically expedient closed-door meetings that have been taking place.”

The governors, who agreed in December to jointly develop a regional energy strategy, asked ISO-New England to collect money from utilities, retail suppliers and others who would then bill electricity ratepayers. The proposal must be approved by federal regulators.

ISO called it a novel approach to spurring investment in natural gas pipeline promising to “break the logjam that has stymied the level of natural gas pipeline expansion needed to meet the region’s needs.”
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Associated Press writer Rik Stevens in Concord, N.H., contributed to this report.

(© Copyright 2013 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)

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