Dive Brief:
- FERC is nearing a decision on whether or not to allow utilities to sign contracts with the Access Northeast pipeline proposal, with opponents arguing the additional gas supplies are unnecessary and will skew markets, SNL Energy reports.
- A decision is due out by the end of August. The project is designed to expand natural gas access in New England by up to 1 Bcf/d.
- Officials with Spectra, the pipeline's developer, talked with SNL Energy about the upcoming decision and what it means for the region's energy mix.
Dive Insight:
As the deadline approaches for FERC to make a decision on utility backing of the Access Northeast pipeline, the project's developer is framing it less as a tariff question and more as an existential query into the region's energy future.
"We have been talking about New England's need for gas infrastructure for electric generation since 2004 — over a decade. If this model is not something you [FERC] are willing to approve, then what do we do?" said Richard Kruse, Spectra's vice president for regulatory affairs. "Either this concept works or it doesn't."
According to Spectra, the pipeline will help save electric customers an average of $1 billion a year during normal weather conditions.
Last year, Massachusetts authorized National Grid and Eversource Energy to enter long-term contracts for gas supply, in order to support the Access Northeast proposal. But NextEra Energy and Public Service Enterprise Group told FERC that the utilities would have no need for the gas capacity and would wind up releasing the gas at below-market rates, in turn driving down energy prices.
Their challenge, Spectra's Kruse told SNL, goes directly to whether or not EDCs should sign contracts for pipeline capacity. "If they should not be signing up for it, then quite frankly I don't know who will," he said.
