Tale of 2 LI energy projects: Gas pipeline advances, power line lacks key fed OK

Two years ago, a $1 billion natural-gas expansion project known as Northeast Supply Enhancement appeared to have as much chance of being built as a wind turbine on the White House lawn. 

Among projects on the front burner for Long Island was 90-mile high-voltage transmission project called Propel NY Energy that would snake from Western Suffolk and Nassau to the Bronx and Westchester to move renewable power around the state. Propel was scheduled to start construction this summer.

But in a twist that has become emblematic of the Trump administration, work on the NESE gas pipeline, developed by The Williams Cos., broke ground last month after years of rejection by New York State. A ceremony to mark the event featured, among others, U.S. Interior Secretary Doug Burgum, who declared the federal government was "putting energy reality over climate fantasy." The pipeline will bring fracked natural gas from Pennsylvania through New Jersey, and under Raritan Bay to a National Grid connecting point in the Rockaway peninsula.

Meanwhile, the Propel power line project is still awaiting a critical approval from the Trump administration’s U.S. Army Corps of Engineers. Earlier this month, three town supervisors from Nassau County criticized the project over its potential impacts on rates, health and disrupted business. The state Public Service Commission is expected to vote on its final approval this summer, but the project still needs federal sign-off.

Proponents say Propel has wide benefits beyond its early wind-power goals, reducing system bottlenecks and easing movement of energy between upstate and down. Some North Shore residents in Nassau are staunchly opposed.

The juxtaposition of these energy project fortunes in just the past year reflects not only a drastic shifting of priorities by the federal government, but a series of nearly real-time responses by the state to address reliability and affordability concerns amid headwinds for offshore wind and solar energy.

Natural gas prices spiked to record highs this winter, impacting not only those who use gas to heat their homes, but electric customers who saw a spike in their power supply charges of as much as 30%. The Long Island Power Authority was forced to burn dirtier fuel oil as a result, and its oldest power plants have run at record levels over the past year.

Faced with a potential power crunch, Gov. Kathy Hochul last year ordered the state to pursue 1,000 megawatts of new nuclear power and put a hold on old power-plant retirements, while her administration this spring canceled a previously awarded bid for thousands of megawatts of wind power in the deep waters off Long Island and New Jersey.

"Everything you thought you knew has turned out to be wrong," said John Howard, a former PSC commissioner and chairman who closely follows energy trends. He now projects a new generation of gas-fired power plants to dot the state landscape, including on Long Island.

"For sure, those power plants on Long Island will get built," Howard predicted, noting National Grid’s stated ambition to repower its oldest Long Island plants. "Upstate, those nukes, yes, we’re going to build them. I think we’ll also get the Constitution pipeline," another Williams project that could ease gas supply constraints across New York and New England.

"I think the last two years of the Trump administration they’ve been doing everything they can to kill green and build as much national gas infrastructure as possible," Howard said.

Those who oppose carbon-emitting fossil fuels are quick to note that the last three years have been the hottest on record for the planet.

"We should be weaning ourselves from natural gas and we should be doing everything we can to avoid making new long-term investments in fossil-gas infrastructure," said Christopher Casey, a senior attorney for the environmental group, Natural Resources Defense Council, where he's also the New York area utility regulatory director. The NRDC has filed court challenges to water-quality permits for the project in New York and New Jersey. 

The NRDC's position, he said, is that NESE is an "affordability boondoggle that New Yorkers shouldn’t have to bear," because "existing [gas] capacity is sufficient to meet peak demand until the 2040s." 

At the Brooklyn ceremony last month to announce the start of work for NESE, officials said the gas-pipeline enhancement would bring in cheaper and plentiful natural gas and ease regional shortages that have caused prices to spike.

The $1 billion project will cost National Grid ratepayers an average of $7.50 a month to pay for the line, though commodity portions of bills are projected to decline once the cheaper gas is flowing. 

Pointing to recent winter price spikes in New York where gas costs were three times higher than the rest of the country, Chad Zamarin, chief executive of NESE-developer Williams, said an "affordability crisis in New York stands alongside the global race for artificial intelligence, and the solution to both challenges is only possible by unleashing domestic energy through infrastructure like our Northeast Supply Enhancement Project."

He declared natural gas "truly our country’s affordability superpower."

Opponents see it differently. 

"We will pay the price [in higher energy bills] and in all the climate damage that burning fossil fuels is going to create," said Kim Fraczek, director of the climate activist group, Sane Energy Project. She called it "very alarming at this point in history where we really need climate leadership" that the federal and state governments have "adopted a drill-baby-drill mantra," when they could be solving energy needs with energy efficiency and renewables. 

Less than a month after the NESE groundbreaking, LIPA last week announced the start of an updated review of Long Island power sources with an eye toward recent changes in state energy policy and market realities. The review, which will incorporate only existing energy technologies, will assume for now that only Empire Wind and Sunrise Wind offshore wind farms will get built in the next two years, and it will study the portfolio of large and small gas-powered plants to determine how best to provide affordable and reliable power for the coming decades.

The plan will include a review of replacing older gas plants with new more modern gas-fueled plants, said Gary Stephenson, senior vice president for power supply for LIPA.

"It might be that the least expensive, most no-regrets pathway is to build a less expensive peaker plants," said Stephenson, referring to smaller, efficient gas turbines that would be placed strategically around the Island. Existing peaker plants are "really old," he added. "We’ve got engines from DC-9s airplanes that are still critical to reliability. That would be where I would focus, on trying to upgrade some of those facilities."

The PSEG and LIPA teams working on the project are awaiting word from the state budget planners about expected changes in the 2019 Climate Act, including potential easing of mandates for retiring fossil-fuel plants.

The NESE project, aimed at bolstering existing gas lines to increase the downstate region’s supply of gas by 13%, was rejected by the administration of former Gov. Andrew M. Cuomo as unneeded and potentially tying the region to a future reliance on greenhouse gas-emitting fossil fuel. Instead, under Cuomo and Hochul later, all the focus, investment and planning went into the green-energy projects, with wind farms as the replacements for big gas-burning power plants and a network of new high-voltage transmission lines to move that power where it was needed.

In an interview Thursday, Larry Larsen, executive vice president and chief operating officer at Williams, said the addition of NESE will not only address price spikes, but allow for the environmental benefit of switching more heating customers off fuel oil, while allowing power plants to burn less oil. And he stressed that the bridge to green energy need not cease.

"Even if you are bridging toward other energy solutions with wind and solar, [natural gas] is still the bedrock that helps on the reliability piece as those things swing through the time when the sun’s out and the wind’s not blowing," he said. "You’re still going to need backup sources."

But the region also needs more power-transmission infrastructure. Stephenson said. The LIPA power review will assume that the Propel cable project is in service by 2030, he added.

"It’s definitely very helpful, and a good thing for Long Islanders to be contributing our share to get that thing built," he said. "It’s projected to reduce our on-island capacity needs, because we can actually import from upstate a little bit more, and so we’re less reliant on on-island capacity, so it’s helpful from that perspective." LIPA is projecting something over 100 megawatts of capacity to be addressed by the cable.

But it still must meet all the state and federal requirements for approval. Susan Craig, a spokeswoman for Propel’s co-developer, the New York Power Authority, said the agency is in the process of filing six separate environmental management and construction plans for the project. The PSC must approve the joint proposal before a final certificate of environmental compatibility and public need is voted on for the project to move forward.

The U.S. Army Corps permit is "not a prerequisite, but it is a condition" for the PSC approval, Craig noted. The PSC "can grant the certificate, pending all applicable approvals." But the project would need both the PSC and Army Corps greenlights to break ground. The permit remains under review, and Craig said, "We anticipate approvals later this year."

She said the hope is that the PSC will approve Propel’s certificate for the project this summer.

Howard said he expects Propel to move forward. "It frees up a bunch of congestion," he said, and he called it a "good deal for Long Islanders," who will pay 13% of the $3.26 billion cost and get most of the benefit, while other state utilities customers will pay the balance under a state cost-sharing mechanism.

But those who oppose the cable, primarily North Shore residents and business owners, worry about road disruptions and health effects of multiple high-voltage lines, 

"Digging up ... miles of Long Island roads is expensive, extremely disruptive and dangerous to our communities and children," Gary Bochner, of East Hills Cleaners, wrote to the state in January. "This [$3.26] billion dollar project will not lower energy rates. They will increase." 

By Mark Harrington

mark.harrington@newsday.comMHarringtonNews

Mark Harrington, a Newsday reporter since 1999, covers energy, wineries, Indian affairs and fisheries.