Demand debated for natural gas that would be delivered by Tennessee Gas pipeline

Last modified: Saturday, April 11, 2015

The public statement by the Tennessee Gas Pipeline Co. about demand “appears to be seriously overstated,” area opponents of the Northeast Energy Direct project told the Federal Energy Regulatory Commission last week.

Massachusetts Pipeline Action Network President Kathryn Eiseman, in a letter sent Wednesday to the Federal Energy Regulatory Commission, referred to a March 5 press release by Kinder Morgan, parent company of Tennessee Gas, announcing its contract with its three largest potential pipeline customers, for a total of 416,263 dekatherms of gas per day. They are National Grid, 186,963 dekatherms per day; Liberty Utilities, 115,000; and Columbia Gas of Massachusetts, 114,300.

But National Grid, in its March 31 filing with the Massachusetts Department of Public Utilities, seeks approval of a contract for only 151,962 dekatherms of gas per day, 35,000 less than the figure given by Kinder Morgan.

“It appears that either Kinder Morgan’s press release was inaccurate, or, in the course of less than a month, National Grid has renegotiated for less capacity on the pipeline than originally planned,” Eiseman wrote, so that the total of the three executed binding precedent agreements is 381,262 dekatherms per day.

Kinder Morgan spokeswoman Sara Loffelholtz told The Recorder, however, that National Grid is seeking approval for 151,962 dekatherms per day in Massachusetts only, with the remaining 35,000 destined for Rhode Island.

Tennessee Gas proposes to build a 36-inch-diameter pipeline from Pennsylvania to Dracut that would pass through Plainfield in Hampshire County, and eight Franklin County towns, including Deerfield.

Eiseman said the customers also differentiate between replacing previously contracted-for capacity on other pipelines, and additional firm capacity, and all three propose to use “a substantial portion” of their contracted Tennessee Pipeline capacity to replace contracts on existing pipelines, rather than for new capacity needs.

That would mean that only 235,462 dekatherms per day — “ barely half of the amount of incremental capacity” claimed by Kinder Morgan – is for pipeline capacity that does not simply replace contracts on existing pipelines, Eiseman said. She quotes the Federal Energy Regulatory Commission’s own goals of “considering enhancement of competitive transportation alternatives, the possibility of overbuilding, the avoidance of unnecessary disruption of the environment, and the unneeded exercise of eminent domain.”

“NED fails on all counts,” Eiseman said. “Kinder Morgan and the anchor shippers’ case for the ‘need’ for this pipeline is built upon abandoning pipeline contracts that are already in place, creating unused capacity elsewhere. The disruption to the environment this project would cause, with over 400 miles of pipeline and nine new compressor stations totaling over 373,000 horsepower in four states, is vastly out of proportion with any need the project might serve.”

In a written statement Thursday, Loffelholtz said, “The information that was released in our March 5, 2015 press release accurately represents current binding precedent agreements with anchor shippers. ... We strongly believe that these binding contractual commitments demonstrate the clear need for an expansion of TGP to provide a solution to reduce energy costs and enhance gas and electric reliability in New England. These shipper agreements provide an important foundation for the successful development of the NED project.”


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