ELECTRONICALLY FILED
STATE OF MAINE
Docket No. 2014-00071
PUBLIC UTILITIES COMMISSION
March 20, 2015
MAINE PUBLIC UTILITIES COMMISSION
Investigation of Parameters for Exercising
Authority Pursuant to the Maine Energy Cost
Reduction Act, 35-A M.R.S. § 1901
NORTHEAST ENERGY
SOLUTIONS,INC.'S STATEMENT
IN OPPOSITION TO TENNESSEE
GAS PIPELINE COMPANY, LLC' S
APPEAL OF PROCEDURAL
ORDER DENYING MOTION TO
ESTABLISH SCHEDULE
NOW COMES Northeast Energy Solutions, Inc. ("NEES"), and pursuant to Chapter 110,
§ 5(B) of the Rules of Practice and Procedure (the "Rules") of the Maine Public Utilities
Commission (the "Commission"), submits this Statement in Opposition to Tennessee Gas
Pipeline Company, LLC's ("TGP") motion to appeal the Procedural Order — Ruling on
Scheduling Motions issued by the Commission.
In support of its Statement in Opposition, NESS states as follows:
Background
1.
On February 21, 2015, the Industrial Energy Consumer Group ("IECG") filed a
letter with the Commission, requesting the Commission to expedite this proceeding.
Thereafter, the Commission received additional motions concerning whether the
Commission should continue with the Schedule in Place or establish an amended schedule
with accelerated dates for Phase 2 of this proceeding.
Page 1 of 5
On March 12, 2015, the Commission issued a Procedural Order — Ruling on
2.
Scheduling Motions denying the requests of IECG and TGP to establish an expedited
schedule for decision on the Phase 2 proposals by May or June of 2015.
On March 17, 2015, TGP filed a motion to appeal the Procedural Order, pursuant
to Chapter 110, § 11(D) of the Rules, and requesting the Commission to establish a
prompt schedule for the remainder of this proceeding ("TGP's Appeal"). TGP argues the
Commission is not acting with urgency and is acting against the legislative intent of the
Energy Cost Reduction Act.
Discussion
4.
NEES submits that the Commission continues to act with urgency and with
jurisdictional prudence. The mandate of the Act is quite clear: The Commission must
conduct a cost benefit analysis of the purported benefits of any proposed pipeline
expansion contract. That notwithstanding, TGP's Appeal accuses the Commission of
repeating "all of the aspects of the energy cost crisis the Legislature itself considered in
fashioning the Act..." Nothing could be further from the truth. The Commission is
currently reviewing capacity proposals within the context of the modern economics of the
global energy market. The Legislature did not have a single developer proposal formally
before them during its deliberations in adopting the Act; nor, did the Legislature have the
ability to foresee the current seasonal differentiations from then to now. The Commission
is not re-litigating any elements that were eventually embodied within the Act. The
Commission, quite simply, is implementing the Act.
Page 2 of 5
The TGP Appeal again pleads for the Commission to encourage the State of
Maine to become an economic partner to TGP's proposed Northeast Direct project.
However, the TGP Appeal does not include any legal authority under the Act to
authenticate their plea. In fact, the Act requires the opposite as noted in the Commission's
Procedural Order — Ruling on Scheduling Motions issued by the Hearing Examiners on
March 12, 2015: "...the Act gives authority to the Commission to do so only after it has
determined that the benefits of a pipeline expansion contract will exceed its costs. The
analysis of the costs and benefits of pipeline capacity expansions is a complex
undertaking, for which the Commission has engaged London Economics International
(LEI), an expert consultant. LEI will employ sophisticated econometric and regional
energy modelling to gain a full understanding of the likely effects of each of the project
proposals. The results of this detailed analysis will be critical to the Commission's
decision-making..."
6.
TGP's Appeal also provides some discussion regarding legislative intent by way
of quoting Senator Cleveland: "It is the goal of this legislation to accomplish the
following actions to address these cost increases and grid reliability threats.... Third,
with the newly created natural gas pipeline capacity purchase capability of the Public
Utilities Commission and through the participation in regional energy organizations by
public and utility officials, cause the development by 2017 of at least 2 billion
cubic foot per day additional natural gas pipeline capacity into southern New
England."
Notwithstanding whether two billion cubic feet per day of additional natural gas
pipeline capacity is required in our region to meet current and foreseeable, actual need,
sufficient capacity is being developed by way of other projects, both planned and.
Page 3 of 5
underway, as of March 16, 2015, in the northeast as shown in Exhibit A to this Statement
in Opposition. Moreover, none of the projects listed in Exhibit A —but for Northeast
Direct —are pleading to the State of Maine for financial viability.
7.
TGP's Appeal also discusses purported ECRC "off ramps" being "ignore[d]" by
the Commission. However, TGP's analysis of their proposal's "flexibility" comparative to
Spectra's proposal only serves the Commission as an optimal example of why the
Commission must continue with detailed analysis.
According to TGP's Appeal, Spectra's flexibility is based upon developer
confidence in Spectra's proposed project proceeding solely "based on market support
irrespective of a Maine ECRC." In other words, Spectra will be building its proposed
capacity without the Commission endorsing any particular project as a result of this
proceeding.
Also according to TGP's Appeal, TGP's flexibility is based upon "exit
strategies... entered into at the conclusion of this proceeding." TGP goes onto quote its
own proposal in order to explain that the purported "exit strategies" would only be the
State of Maine's ability to sell the very capacity it had secured from TGP.
There is great need to examine these proposals in detail, and for the Commission
to not rely on any particular developer's unqualified assertions made at any time during
this proceeding.
8.
TGP's Appeal asserts that NESCOE is stalled. Conversely, NESCOE's Annual
Report, dated March 11, 2015, states: "In 2015 and beyond, NESCOE will continue to
advance proposals and support market modifications that recognize the imperative that
regional planning and wholesale market mechanisms find an appropriate balance to
enable the states to execute the requirements of state energy and environmental laws,
Page 4 of 5
reflect consumer investment in local energy resources, and consider wholesale market
concerns. It is critical that federal regulators and the entities they regulate respect state
energy and environmental laws and reflect consumer investment in local energy
resources. These may include but are not limited to state renewable energy requirements,
implementation of microgrids, sustained aggressive investment in energy efficiency and
small local generation resources, and other means to enhance grid reliability and continue
progress to reduce the region's reliance on higher emissions fuel sources."
Further, according to a March 10, 2015 WBUR, a NPR news station, report by
Bruce Gellerman, As Winter Electricity Prices Jump, Mass. Debate Over Natural Gas
Pipelines Heats Up: "In the coming weeks, Massachusetts Gov. Charlie Baker is planning
to host fellow New England governors for an energy summit. Topic one for the Boston
gathering will be the soaring cost of electricity."
NESCOE may be retying up, not stalled.
Conclusion
Wherefore NEES respectfully urges the Commission to deny TGP's Appeal and uphold
the Procedural Order dated March 12, 2015.
Respectfully submitted on this 20t~' day of March, 2015.
i~..~ ~{ V
BY: Northeast Energy Solutions, Inc.
Vincent Devito, Esq.
Bowditch &Dewey LLP
One International Place, 44th Floor
Boston, Massachusetts 02210
(617) 757-6500
vdevito(a,bowditch.com
Page 5 of 5
Exhibit A
{Client Files/REA/308841/0004/B0519295.DOCX;I }.docx;l )
Tennessee Gas Pipeline
Fa112015
Nov. 2015
Nov. 2015
Nov. 2015
15` qtr. 2015
EST.
IN-SERVICE
STATUS
Authorized by FERC, 12-18-14.
Filed with FERC, Feb. 2014. Approved
by FERC, Feb. 2015.
Filed with FERC, March 2014.
Approved by FERC, Feb. 2015.
Jointly filed with FERC, March 2014.
Approved by FERC, March 2015.
Precedent agreements signed June
2009. Filed with FERC, 1-13. FERC
issues final EIS, 2-14. Approved by
FERC, 5-14. Under construction.
Prepared by Northeast Gas Association, March 2015. Based on publicly-available information; details may change.
Columbia Gas
Transmission
Proposed capacity of 158,000 dekatherms per day of
natural gas. Seneca will serve as the foundation shipper
for TGP's Niagara Expansion Project, which is designed
to provide transportation from the prolific Marcellus
Shale in Pennsylvania to TGP's interconnect with
TransCanada Pipeline in Niagara County, N.Y.
The project will involve the installation of two natural
gas pipelines with approximately 9.5 miles of pipeline in
Chester County, PA and 9.5 miles of pipeline in
Gloucester County, NJ. The project will also include
modifications and upgrades to certain station facilities.
National Fuel Gas Supply
Northern Access
2015
Niagara
Expansion
East Side
Expansion
Capacity of 140,000 Dth/day. Capacity lease to TGP
from Ellsbury to East Eden.
National Fuel Gas Supply
&Empire Pipeline
Tuscarora
Lateral
The project involves a proposed 3.2-mile 26-inch lateral,
consisting of approximately 2.9 miles of offshore
pipeline and approximately 03 miles of onshore
pipeline. Designed to provide approx. 647,000 Dth/d of
natural gas delivery capacity to National Grid's gas
distribution system in Brooklyn and Queens, NY.
Planned capacity of 95,000 Dth/d. 17 miles of pipeline
plus storage wells and lines. Market is on-system utilities
DESCRIPTION
Williams /Transco
COMPANY
Rockaway
Lateral
PROJECT
The Northeast Gas Association (NGA) has prepared this summary based on publicly-available information.
NGA will strive to keep the information as updated as possible and notes that
this information may change pending project developments. May not include all projects.
PLANNED ENHANCEMENTS, NORTHEAST NATURAL GAS
PIPELINE SYSTEMS (as of3-76-75)
Cabot/Williams
Iroquois Gas Transmission
National Fuel Gas Supply &
Empire Pipeline
Dominion Pipeline
Algonquin Gas Transmission
/ Spectra Energy
Tennessee Gas Pipeline
Constitution
Pipeline
Wright
Interconnect
Project (WIP)
Northern Access
2016
New Market
Project
AIM
Connecticut
Expansion
Capacity of 72,100 Dth/d. Pipeline looping on TGP
200 and 3001ines. Market is CT natural gas utilities.
Adds 175,000 Dth/day of incremental capacity. 23
miles of 24" pipeline and additional horsepower at
Mercer (TGP Sta. 219).
Approx. 120-mile Constitution Pipeline is being
designed to extend from Susquehanna County, PA, to
the Iroquois Gas Transmission and Tennessee Gas
Pipeline systems in Schoharie County, N.Y.
Proposed capacity of 650 MMCf/d. Cabot and
Southwestern are shippers.
WIP will enable delivery of up to 650,000 Dth/d of
natural gas from the terminus of the proposed
Constitution Pipeline in Schoharie County, NY into
both Iroquois and the Tennessee Gas Pipeline under a
15 year capacity lease agreement with Constitution.
Capacity of 350,000 Dth/day. Deliveries to
Chippawa, with new interconnect at TGP 200 Line.
] 00+miles of 24"/30" pipeline and Empire
compressor station.
Planned for customers in upstate NY (National Grid).
Will include the addition of 2 new compressor
stations along DTI's existing transmission pipeline;
and increased compression at an existing station.
Capacity of 112 MMcf/d.
Providing 342 MMcf/d of additional capacity to move
Marcellus production to Algonquin City Gates.
Shippers are 6 gas utilities in New England.
DESCRIPTION
Nov. 2016
2"a half 2016
Nov. 2016
Nov. 2016
2016
Late 2016
Nov. 2015
EST.
IN-SERVICE
STATUS
Open season held, fall 2012. Filed
with FERC, 2-14. FERC issues draft
EIS, 8-14. FERC issues final E1S, 115. Approved by FERC, 3-15.
Open Season held July 2013. Filed
with FERC, 7-14.
Filed with FERC, June 2014.
In FERC pre-filing process, July 2014.
Announced 1-13. Filed with FERC, 613. FERC issued final EIS, 10-14.
Authorized by FERC, 12-2-14.
Announced spring 2012. Filed with
FERC, 6-13. FERC issued final EIS,
10-14. Authorized by FERC, 12-2-14.
Filed with FERC, Feb. 2014.
Approved by FERC.
Prepared by Northeast Gas Association, March 2015. Based on publicly-available information; details may change.
National Fuel Gas Supply
COMPANY
West Side 2015
Expansion
PROJECT
PLANNED ENHANCEMENTS, NORTHEAST NATURAL GAS
PIPELINE SYSTEMS (as oF3-76-75), page 2
Millennium Pipeline
PNGTS
Iroquois Gas Transmission
Spectra Energy
Corning to
Rockland
Continent to
Coast (C2C)
Expansion
South-to-North
("SoNo") Project
Atlantic Bridge
&
The project has been designed to provide up to 180,000
dekatherms per day of natural gas service in two phases
to a new delivery point with New Jersey Natural Gas in
Burlington County, N.J. The project will include the
installation of a new compressor station, meter and
regulating station on land located in Burlington County,
N.J. It will also require modifications and the addition of
compression at an existing compressor station. No
expansion of the pipeline is required.
Company looks to expand capacity along its natural gas
pipeline that extends from Corning, New York to
Rockland County, New York to meet customer demand.
C2C will access natural gas supplies from key North
American natural gas basins via TransCanada Pipeline.
Atlantic Canada markets can then transport on PNGTS to
an interconnect with Maritimes and Northeast Pipeline at
Westbrook, ME. Shippers interested in moving natural
gas further south into New England can transport on
PNGTS to interconnects with other NE natural gas
pipelines. May raise PNGTS' current capacity of
168,000 Dth/d to approx. 300,000 Dth/d.
Reverse flow on Iroquois offering physical transport to
U.S./Canada border. The Soho project would transport
up to 300,000 Dth/day from Iroquois' existing
interconnects with Dominion Transmission in
Canajoharie, NY and Algonquin Gas Transmission in
Brookfield, CT, as well as the proposed Constitution
Pipeline in Wright, NY.
Incremental expansion on Algonquin and Maritimes
Northeast, to serve New England and Canadian
Maritimes. Capacity of 220,000 Dth/d.
DESCRIPTION
2017
Nov. 2017
Nov. 2017
2017
/
Nov. 2016
Nov. 2017
EST.
IN-SERVICE
STATUS
—
—
Announced, Feb. 2014. Open season
held, Feb.- March, 2014. In pre-filing
with FERC, Feb. 2015.
Open season held, Dec. 2013 —Jan.
2014. Relaunch of open season, Jan.
Feb. 2015.
Open season, April 1 to June 28, 2013.
Open season re-convened, Dec. 2013
Jan. 2014. Relaunch of open season,
Jan. —Feb. 2015.
Open season announced March 2015.
Filed with FERC, Feb. 2015.
Prepared by Northeast Gas Association, March 2015. Based onpublicly-available information; details nzay change.
Williams/Transco
COMPANY
Garden State
Expansion
Project
PROJECT
PLANNED ENHANCEMENTS, NORTHEAST NATURAL GAS
PIPELINE SYSTEMS (as of3-76-75), page 3
Access Northeast
Northeast
Energy Direct
(NED) Project
PennEast
Project
PROJECT
DESCRIPTION
EST.
Nov. 2018
Nov. 2018
2017/2018
IN-SERVICE
STATUS
Announced 9-14. Solicitation of
interest held, fa112014.Open season
announced, 2-18-15 to run till May 1,
2015.
Open season held, Feb.-March, 2014.
In July 2014, Kinder Morgan
announced that 9 gas utilities in region
have committed to project as initial
shippers, at level of approx. 500,000
dekatherms per day (Dth/d). In FERC
pre-filing process as of 9-14. Updated
routes announced, 12-8-14.
Announced Aug. 2014. Open season
held August 2014.
Prepared by Northeast Cas Association, March 2015. Based on publicly-available information; details may change.
AGL Resources, NJR Pipeline 100-mile pipeline intended to bring lower cost natural
Company, South Jersey
gas produced in the Marcellus Shale region to homes
Industries, UGI Energy
and businesses in Pennsylvania and New Jersey.
Services, Spectra Energy and Designed to provide natural gas service. to the
PSE&G Power LLC
equivalent of 4.7 million homes, up to 1 Bcf per day.
PennEast is investing nearly $1 billion to build the
pipeline with the costs split among the four entities.
Construction of the pipeline could begin in 2017
pending regulatory approvals.
Tennessee Gas Pipeline /
This project is a combination of TGP's proposed
Kinder Morgan
Pennsylvania to Wright, NY and Wright, NY to
Dracut, MA projects. Proposes construction of
greenfield pipeline, additional meter stations and
compressor stations, and modifications to existing
facilities in Pennsylvania, New York, Massachusetts,
Connecticut, and New Hampshire. Scalable capacity
from 1.2 (30") to 2.2 (36") Bcf/d. Approximately
90% co-located along existing utility corridors /
adjacent to TGP mainline.
Spectra Energy, Eversource
The gas pipeline expansion project will enhance the
Energy, National Grid
Algonquin and Maritimes pipeline systems and
market area storage assets in New England to deliver
up to one billion cubic feet of natural gas per day for
electric generation markets. Alliance with Iroquois
Gas Transmission announced, 12-14.
COMPANY
PLANNED ENHANCEMENTS, NORTHEAST NATURAL GAS
PIPELINE SYSTEMS (as of3-76-75), page 4