Dive Brief:
- Spectra Energy informed federal regulators it is delaying the proposed $3 billion Northeast Access pipeline, reiterating the demand for new gas capacity while also indicating it would need to "solidify the commercial foundation" of the project.
- In August, the Massachusetts Supreme Judicial Court blocked regulators from approving contracts that would fund the line through a charge on electric bills.
- The project, an expansion of the existing Algonquin Gas Transmission system, would help boost gas capacity in the region by up to 925,000 dekatherms per day. The company may now look to changes in Massachusetts law to push the project ahead, according to a report in the New Hampshire Union Leader.
Dive Insight:
New England still needs natural gas, but Spectra last month told the Federal Energy Regulatory Commission (FERC) that it must rethink how to pay for new capacity into the region.
"Algonquin believes it is prudent to take additional time to solidify the commercial foundation for critically needed infrastructure and to complete its analysis of the Access Northeast facilities," the company told FERC in a December filing. The company said it anticipates filing draft resource reports in the middle of this year, followed by a full application.
Eversource Energy and National Grid both pulled support for the proposed expansion in the aftermath of the Massachusetts high court's decision. And four other utilities—NSTAR, Western Massachusetts Electric, Massachusetts Electric and Nantucket Electric—dropped petitions to acquire capacity on the line.
According to a report from the Boston Herald, the delay likely pushes back the expansion inservice to 2019, and means Spectra will have to approach state lawmakers for a possible funding fix.
Not everyone is convinced that the region requires additional gas supply, however. Massachusetts Attorney General Maura Healey argued that requiring electric ratepayers to pay for new natural gas pipeline capacity "effectively shifts the risks associated with building these projects," following the court ruling. Healey has said in the past she believes the region's energy needs should be met with efficiency and demand response instead.
