Could feds pave way for new Mass. gas project?

Buzz builds on FERC priorities under Trump

Bruce Mohl Sep 21, 2017

 Environmental activists who oppose the construction of new natural gas pipeline capacity in New England are watching what’s going on at the Federal Energy Regulatory Commission in Washington with growing concern. 

 

The federal agency last week overruled a decision by the New York Department of Environmental Conservation denying a water quality permit for the construction of a connection between an existing pipeline and a natural gas plant currently in development. 


FERC’s decision was based on a technicality – that the New York agency had failed to act within an allotted one-year time frame and thus had waived its authority. Two other pipeline companies have indicated they will go to FERC seeking similar rulings for their projects. 

While the FERC decision seems fairly narrow in scope, industry officials and environmental activists both say the ruling is a strong signal that the federal agency under President Trump is willing to take a more activist role in state pipeline battles. That could become important in New England as the region debates whether more pipeline capacity is needed to keep the lights on during the winter months. 

New England’s dependence on natural gas is growing. A report released last week by the regional grid operator, ISO-New England, said natural gas-fired power plants represented 44.5 percent of the region’s electricity-generating capacity in 2016, a percentage expected to grow to 56 percent over the next decade. The report also said inadequate pipeline capacity in the region raises reliability concerns that are “particularly critical” during peak winter demand conditions when prices rise and some natural gas plants find it difficult to obtain fuel. 
 
For several years now, the region has been debating what to do about the pipeline situation, which has been subsumed to some degree within the broader debate about climate change. Nowhere has the debate been more intense than in Massachusetts, the largest consumer of electricity in the six-state region. 


Last August, the Massachusetts Supreme Judicial Court rejected a Baker administration initiative to tap electric ratepayers for the money to finance additional gas pipeline capacity. The court held that existing state law didn’t allow such a financing arrangement, and gaining legislative approval for the approach is considered unlikely, largely because the state Senate during the last session voted unanimously to oppose such a move. 

The pipeline debate has faded from the headlines, but it hasn’t disappeared. ISO-New England is working on a “fuel security study” due out next month that will assess whether the region can keep the lights on without new pipeline capacity. Given the ISO’s past pronouncements, the betting is that the grid operator will say the region needs another natural gas pipeline. 

Still, the politics haven’t changed. Many of the New England states favor adding more pipeline capacity, but Massachusetts remains a holdout.  

Environmental advocates say they are worried that ISO-New England may use its fuel security study to push for a region-wide tariff on electric ratepayers to pay for the additional pipeline capacity. Just as the ISO makes the case for transmission projects needed to keep the grid operating smoothly, it could argue that more pipeline capacity is needed to keep natural gas-fired power plants running during the winter months. 

FERC under former president Obama would have been reluctant to bless what is basically a way to sidestep Massachusetts opposition, but Trump’s new appointees to the agency, as they demonstrated last week, may feel the region’s energy needs are a higher priority. 
 
Kathryn Eiseman, director of the Massachusetts Pipeline Awareness Network and an opponent of new pipelines, said she is monitoring the agency’s actions closely. “FERC often breaks the law and allows pipelines to be built before anyone can get into court to prove that the agency has abused its power,” she said.