Utilities Are Threatening to Deny Service If Pro-Gas Measures Aren't Adopted

National Grid sent many New York customers an email encouraging them to contact state officials in support of pipeline construction or risk shortages.
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A gas field in Lost Hills, California, where fracking occurs.

A gas field in Lost Hills, California, where fracking occurs. 

Last month, many New York customers of the utility company National Grid received an urgent email, not about overdue bills or a rate increase, but rather calling them to action. "Natural gas supplies are at risk in downstate New York," the utility warned, because of the current impasse on a new fracked gas pipeline stretching from Pennsylvania, through New Jersey, to the Rockaways. The energy company, which essentially holds a monopoly on gas service in the area, urged its customers to contact their government representatives to support the construction of the Northeast Supply Enhancement (NESE) project. Without the project's approval, National Grid said, it would be unable to meet any requests for new gas hook-ups in Brooklyn, Queens, and Long Island.

The proposed new pipeline would allow National Grid to pump an extra 400 million cubic feet per day of natural gas—an additional 14 percent beyond its current capacity. In May, state regulators denied National Grid permits for the $1 billion expansion of the New York pipeline sections—called the Williams pipeline—over water quality concerns, after a chorus of opposition from Democratic officials. The Williams Companies, an Oklahoma-based energy company that would manage the project, has adjusted their proposal and re-applied, via a subsidiary, for permits. The National Grid email, sent on July 8th, encouraged customers to fill out a contact form to reach local, state, and federal officials by July 13th, the end of the comment period on the new proposal.

Public utility advocates say that the attempt to turn customers into lobbyists is unprecedented for utility companies. "People allow the company to send them electronic bills, but to send them lobbying communications is something very different from what they believe they agreed to," says Richard Berkley, executive director of the Public Utility Law Project of New York, of the email blast.

The emails may be a new tactic, but denying service appears to be becoming a standard tactic in utility companies' toolbox to push against moves toward alternative energy sources. In western Massachusetts, at least a dozen towns have been subjected to moratoriums by the local utilities, who cite a lack of pipeline capacity. In March in Westchester County, just north of New York City, Con Edison, the region's main utility company, imposed a moratorium on new gas hook-ups, claiming that it could not meet increasing demands for fuel without increased pipeline capacity. The announcement caused a panic, leading some developers to put residential and commercial projects on hold, and, at the time, the county projected that the construction of 16,000 homes could be suspended.

A similar panic is now rising in New York City over the National Grid moratorium. Thomas Grech, the president and chief executive officer of the Queens Chamber of Commerce, says that his office has been getting three to five phone calls a week from concerned residents and business owners, including one non-profit housing developer who is struggling to figure out how to heat a new 70-unit building in Jamaica, Queens, without gas hook-ups. Two deli owners who were about to open a restaurant in Brooklyn when they were denied gas say that that the moratorium has cost them $400,000 in business loans. Calls have been coming in for weeks to the offices of state assembly members and city council members. According to the Wall Street Journal, National Grid has refused more than 2,000 requests since May.

The veracity of the New York gas shortage has been called repeatedly into question. In an email to the president of National Grid on July 31st, 17 city council members, including the speaker, wrote that "it is very clear that the decision to deny new applications for gas meters was made after the Williams Pipeline Project ... failed to pass its approval process." The letter went on: "It is unconscionable to attempt to lobby customers by denying them heat and the ability to cook food, as part of a corporate campaign for fossil fuel extraction."

At the state level, elected officials are calling on the state's Public Service Commission to investigate National Grid's actions. "It seems that they are trying to force our hand and scare folks so that they can build out future infrastructure projects," says state assembly member Robert Carroll, who is opposed to the pipeline. It's a clear effort, he says, to compel the state to "stay addicted" to fossil fuels.

A representative from PSC says that the issue is being examined. The PSC has spent months evaluating the conditions that Con Edison blamed for the moratorium in Westchester, but their findings are not yet public, despite a July 1st due date for a report.

When asked about the charges that the company does not, in fact, face a gas shortage, National Grid spokesperson Karen Young reiterated that its supply "has now reached full capacity. ... Our ability to provide additional gas supply to new or existing customers depends on New York State and New Jersey's approval of NESE. Without approval of all permits, requests for additional load simply can't be processed. To add additional service without NESE would pose a risk to the integrity of our system and compromise natural gas use for our existing firm customers."

There's good reason for skepticism about the shortage. As City Limits reported back in May, National Grid has repeatedly overestimated gas usage in its filings to the PSC: In 2016, its projection for 2017 was 35 percent higher than what the company actually provided. The company also reduced its 2016 projections for 2018 and 2019.

A March report by 350.org, a renewable energy organization, found that, while National Grid claims that the pipeline is necessary to carry out the locally mandated elimination of certain types of fuel oil from residential boilers, very few boilers continue to use these types of oil. Overall, demand for gas is going down, the report found, not up. The report's author, Suzanne Mattei, a public interest lawyer with Lookout Hill Public Policy Associates, says that the conduct of National Grid and Con Edison in imposing these moratoriums is in keeping with the gas industry in general. "It's an industry that's out of control," Mattei says. "They're becoming irrational as they hunt for new markets and seek big investments in infrastructure when it's an industry that has to change."

Indeed, opponents of pipeline expansion say that imposed moratoriums are usually a fabrication by utility companies. "The big corporate utilities are using these moratoriums to try to scare business," says Lee Ziesche, an organizer with Sane Energy Project, a renewable energy advocacy group that has led efforts to oppose the Williams pipeline. "They're saying that the economy is going to collapse, but what they really want is just to lock us into decades more of fracked gas use and keep their business model alive. If we all have solar panels and geothermal, they don't have a product to deliver."

Environmental groups and elected officials opposing the Williams pipeline argue that it is not compatible with the state's ambitious plans to shift to renewable energy and reduce emissions in the coming years. Public opinion appears to reflect the same: The New York Department of Environmental Conservation has received approximately 38,000 public comments opposing the project so far, and a poll released this week by the independent firm Anzalone Liszt Grove Research found that New Yorkers oppose the Williams pipeline by a 20-point margin.

Meanwhile, on the other side of the country, a very different type of gas moratorium is on the horizon. The city of Berkeley, California, voted unanimously last month to ban the installation of natural gas lines in new low-rise residential buildings starting January 1st, instead requiring electric infrastructure. A similar ban in New York City, where the electric grid is already so strained that 50,000 New Yorkers were left without power during the July heat wave, will require deep investments in renewable infrastructure. Assembly member Carroll is hopeful the state is moving in this direction. "[National Grid] think[s] that they've got us cornered and what they underestimate is the fact that New York State is very, very serious about building a truly renewable energy sector that will heat and cool our homes, power our cars, power our businesses. That's a 30-year project, but it's starting now."

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