BCW Urges Public Service Commission to Expand Existing Supply Pipelines in Light of Con Ed Natural Gas Crisis

As Westchester County’s only business membership organization whose focus is on economic development and advocacy in Westchester County, The Business Council of Westchester continues to take action on the Consolidated Edison natural gas crisis, this week speaking up at the NYS Public Service Commission (PSC) public hearing.

With hundreds of millions of dollars in new development and thousands of residential housing units in jeopardy, the BCW is deeply concerned by Con Edison’s announced moratorium on adding new natural gas customers in Westchester effective March 15. Upon receiving the announcement, the BCW immediately convened a high­ level briefing with Con Edison that was attended by more than 50 leading developers, all of whom have important proposed development projects pending in Westchester County.

“The developers in attendance, and dozens more who have contacted us since, expressed a combination of frustration and anger that the situation has been allowed to reach a full-blown crisis, one that poses a serious threat to the future development and the economic health not just of Westchester, but across the entire metropolitan area,” John Ravitz, chief operating officer of the BCW presented at the hearing. “Without question, the root cause of the problem is the lack of gas transmission pipeline capacity necessary to supply Con Ed with enough gas to meet increased demand. This situation has been years in the making. The state’s unwillingness to approve any new pipelines as a way of encouraging creation of new alternative energy sources has backfired. We now have the worst of both worlds: no available new gas supplies and no viable alternatives!”

Ravitz continued: “The Business Council of Westchester urges in the strongest terms that the PSC review the current situation and offer realistic, quickly achievable solutions starting with exploring ways and a willingness to expand the existing supply pipelines.”

Local and state officials also had harsh words at the public hearing, which was held Wednesday in White Plains.

According to The Journal News, Westchester County Legislator MaryJane Shimsky said: “Consolidated Edison has horribly bungled this whole situation and risks dire economic consequences to communities in this county. The dreams of homeowners, and the future economic health of many of our communities, hang in the balance.”

Assemblyman David Buchwald also leveled criticism at the process, particularly the Public Service Commission, saying: “To the extent that the commission is supposed to be the eyes and ears of the people of the state of New York, some recognition should occur that you failed in that mission… And I think the right remedy is for the citizens of Westchester to receive full transparency as to what in retrospect the commission could have done to alert the public and its representatives as to the gas supply situation in our county.”

ConEd vice president Ivan Kimball said the moratorium was needed to address surging demands for natural gas in Westchester County, as more and more customers move away from oil heat. Kimball added that natural gas supplies have failed to keep pace amid regulatory challenges to new pipelines. The last time a new interstate pipeline connecting to the ConEd system was added was 2013 in lower Manhattan, Kimball said.

“While the demand for natural gas continues to grow, the pipeline supply has not increased for a number of years,” Kimball said.

Ravitz explains that this is because the pipeline companies “have given up trying.”

“Over the years they have spent countless millions seeking environmental approvals for new or expanded lines, only to be rejected in the end. At the same time, alternative energy sources such as wind turbines and solar installations have lagged far behind and face their own environmental obstacles,” Ravitz said.

The $3.5 million Smart Solutions program, which the BCW has always supported and which was approved last week by the PSC, falls well short of the urgent action that is needed to provide sufficient energy to supply future demand, Ravitz continued.

“Two of the key elements of the program – creating up to five natural gas ·storage sites and three facilities for the conversion of organic waste to renewable energy – will undoubtedly face significant local opposition and require lengthy environmental review processes with no certain outcomes. And, even if some of these measures are ultimately adopted, the impact on the overall energy supply would be too little too late.”

An example of what lies ahead can be found in the upstate Village of Lansing near Ithaca, where a natural gas hookup moratorium was imposed, Ravitz said. This led directly to the abandonment of a planned new medical facility that would have created 100 new jobs. It should also be noted that since the gas moratorium was put in place in Lansing not a single new restaurant has opened, and the community is facing an economic crisis.

That scenario would be magnified ten-fold in Westchester which is experiencing a major renaissance in its urban centers including Yonkers, White Plains and New Rochelle. In Yonkers alone, there are 8,000 new units of residential housing and more than 2.2 million square feet of commercial space on the drawing boards, development that is projected to create some 5,400 construction jobs, Ravitz explained.

Westchester County’s Industrial Development Agency has approved inducements for $881 million in development, including 1,800 units of rental housing estimated to create 2,900 construction and permanent jobs, largely in White Plains. In New Rochelle, the state recently approved more than $100 million in funding for waterfront development.

“The moratorium on natural gas puts all these projects at risk. That is not a viable option. The moratorium is a wake-up call that can’t be ignored. We’re confident that working together we can and will find viable solutions,” Ravitz concluded. “Tough decisions must be made in the very near future, and some options will face strong opposition.  However, without new gas pipeline capacity to Westchester and the region, we face a huge disruption in economic development and affordable housing projects, particularly in areas that need it most.”