Real estate developers in most of Westchester County are reeling after Consolidated Edison Company of New York, Inc. (Con Ed) announced a temporary suspension of new gas service to customers in the county.
New York State Assembly member Amy Paulin believes the Westchester gas service moratorium is “a potential catastrophe” and a “looming crisis for economic development in Westchester” that will devastate all development in Westchester, including those which aim to provide affordable housing. .
Natural gas meter used to measure gas consumption. Photo: Shutterstock
Con Ed's decision was announced on January 17, 2019, and the moratorium is expected to be implemented no later than March 15. The reason given by Con Ed is supply and demand, stating that it will not have enough gas to meet projected future demand. on the “coldest winter days”.
However, the Wall Street Journal and New York Post report that New York Governor Andrew Cuomo and his unwavering fight against fossil fuel energy are to blame for the situation – because he denied permits for three natural gas pipelines. and banned hydraulic fracturing that would produce new supplies of relatively cheap natural gas.
Con Ed is the main supplier and distributor of natural gas in Westchester, while New York State Electric and Gas (NYSEG) supplies some municipalities in the Northeast.
The New York State Public Service Commission (PSC) has already held public hearings on the Westchester gas service moratorium and is currently investigating the “changes in market conditions” that Con Ed blames for its dramatic decision. A report on the PSC's findings is due by July 1, 2019. It will include an analysis of how utilities across New York State are meeting customer needs in a way that is in line with the New York State's energy goals. State.
In a state of 54,555 square miles, Westchester County occupies just 500 square miles. Situated north of New York City, it is home to nearly a million people.
Possible solutions to Westchester's gas service moratorium
Right now, everyone is looking for possible solutions to Westchester's gas service moratorium. Ultimately, while there is overwhelming support for “green” energy goals, there is an urgent need to implement possible solutions before the moratorium takes effect.
The most obvious solution for many is to expand the existing gas pipeline system, although this cannot be done quickly.
Both Con Ed and National Grid, which supplies natural gas to Long Island and New York City, have previously warned that unless new pipelines were built, they would likely have to turn away new customers who wanted to use natural gas.
The main issue for new gas customers in Westchester is that New York Governor Andrew Cuomo's environmental and economic development priorities have all but put an end to new gas pipelines. Although he wants a carbon-neutral electricity system in the state by 2040 and aims to achieve zero emissions as quickly as possible, he admitted in April 2017 that natural gas would be a bridge to renewable energy. But that's not happening.
The reason given by Conor Brambrick of Environmental Advocates of New York and others is that natural gas has very quickly become the main contributor to greenhouse gas emissions from the electricity sector. Renewable energy is therefore fundamental.
Con Ed itself has been aggressively proposing alternative solutions, specifically innovative “non-pipe” solutions, that could alleviate the demand for new gas supplies.
Although its clean energy alternatives include geothermal and air source heat pumps, and renewable natural gases, and the company supports New York State's renewable and emissions reduction goals, several proposed projects are reportedly still pending approval. The same goes for Con Ed's proposal that the PSC approve gas and electricity rate increases for 2020 and provide $210 million for natural gas and another $485 million for its electrical system so it can increase energy-efficient heating options.
PSC, however, approved Con Ed's Smart Natural Gas Solutions program for natural gas operation, a gas demand response pilot, as well as expanded efficiency programs to evaluate “non-pipeline-related alternatives.” Con-Ed also has state approval for $223 million to increase heat pumps and gas efficiency.
Additionally, PSC said it will monitor the situation to ensure Con Ed provides customers with alternatives.
Officials in New York City, which, along with Long Island, now faces a possible National Grid moratorium, said all of Con Ed's proposals involve very high costs, especially when combined with future pipeline-related costs. For this reason, the city wants the PSC to force Con Ed to “identify and explore synergies whenever possible.”
However, other solutions suggest that third-party companies meet the demand for natural gas that Con Ed cannot satisfy. This would include:
- gas supply via truck
- renewable gas from anaerobic digesters
- incentives for aerothermal and geothermal heat pumps that use ground heat as an energy source
- investments in efficiency
Wind and solar backup systems for electric heating are generally not considered viable options.
The Environmental Defense Fund argues that Con Ed needs to provide more information about gas supply spikes that exceed demand so that alternative solutions can be formulated appropriately. Possibilities may include:
- an increase in the supply of natural gas
- renewable fuels
- new electrical technologies
- parallel strategies that could free up natural gas supplies
- a combination of any of these
Although oil has higher emissions than gas and is more expensive and not as efficient, large commercial developments sometimes select gas services that can be phased out and replaced with oil. Despite enormous opposition, this is a possible solution for some.
Another solution, some say, would be for the federal government to intervene to prevent New York and other states from blocking energy infrastructure needs like new oil pipelines.
How to Get Gas Service in Westchester
The question is whether it is even possible to get gas service in Westchester now that the moratorium has been declared.
Yellow supply lines of natural gas meters. Photo: Shutterstock
Right now, it appears the only way to get gas service in Westchester County is to ensure requests are completed as quickly as possible, before the proposed March 15 deadline. Candidates will then have two years to complete the projects.
But, Con Ed warned that with the huge increase in applications since the gas service moratorium was announced, they could reach capacity sooner than that.
A Con Ed spokesperson said in mid-February that the company had received more than 580 requests for gas connections since the moratorium was announced on Jan. 17, more than double the number received during the same period over the past two years. Peak demand has increased by 30% since 2011 and is expected to increase by a further 20% over the next 20 years.
In addition to new commercial, residential and industrial gas services, the moratorium prevents the expansion of existing services. But one of the stated exceptions to the moratorium are new customers applying for interruptible gas service, so this could be another way to get gas service in Westchester. The question, however, is: what do customers use when service is interrupted? Oil, electricity, emergency generators?
Financial Impacts of Delayed Gas Service
While it is impossible to accurately predict what the financial impacts of a delay in gas service in Westchester will be, estimates were released at PSC public hearings held in Ossining and White Plains, New York, on February 12 and 13. refer to the impact on real estate developments and construction projects.
It's clear that many county officials are angry, saying that at least 2 million square feet of new commercial development and 16,000 new condominiums, apartments and other residential housing would likely be at risk. This, in turn, could, according to George Latimer, a county executive, cost more than $600 million in rental revenue and result in the loss of something like 28,500 jobs in the construction industry.
Testimony from Mike Spano, mayor of Yonkers, stated that many developers would have to halt projects if they were unable to supply. That would halt the real estate boom in his city, the fourth largest in the state. Thomas Roach, mayor of White Plains, had similar concerns.
Whatever the numbers, there is no doubt that a delay in gas service will have a major financial impact.
