American Gas - August/September 2013 - (Page 19)
pass their higher natural gas costs on to
consumers.
“Our preference would be for the
private sector to come forward and enter
into these contracts, but because of the
nature of the marketplace, that just hasn’t
happened,” Cleveland said.
While natural gas utilities buy “firm,”
non-interruptible pipeline capacity
months ahead of time, electricity generators in the region’s highly competitive
wholesale market buy mostly lower-cost
interruptible capacity. When gas demand
peaks, the electricity generators are forced
to buy expensive gas on secondary markets. New capacity would help to solve the
problem, but pipeline builders require an
upfront capital investment that electricity
generators cannot provide.
A new pipeline would save Maine
consumers $200 million a year on electricity costs, according to a legislative study.
The contracts, which would be capped at
$75 million annually, would be funded
through an assessment on ratepayers and
would require the governor’s approval. The
PUC would sell the capacity to electric
utilities at rates that would reduce consumers’ electricity costs.
While that $75 million wouldn’t
be enough to fund construction of the
pipeline, it would be a catalyst for private
investment, Cleveland said.
The new authority for the PUC was
the centerpiece of the Omnibus Energy
bill, which was initially vetoed by Gov.
Paul LePage, who said he wanted wind
power to be part of the plan. When
legislators passed a separate bill giving
support to a University of Maine offshore
wind power project a week later, LePage
withdrew his objections to the Omnibus
Energy bill, and the Senate unanimously
overrode the veto.
The Omnibus Energy bill also expands
funding for electricity conservation programs to $44 million from $28 million
a year, and provides an additional $6.6
million to help homeowners switch from
heating oil to more efficient natural gas,
wood pellet, or propane systems.
Patrick Woodcock, director of the
governor’s energy office, said it remains to
be seen if the legislature’s plan is the answer
to natural gas supply problems in New
England. “We certainly hope this fosters a
dialogue on how to resolve this regional issue without exposing our citizens to unnecessary risk,” he told American Gas.—J.P.T.
s tat e h o u s e
Pennsylvania’s “Game
Changer”
Gas production fees help to
revitalize communities
harrisburg, pa —In 2012, Pennsyl-
vania enacted a law—called Act 13—that
required gas companies to pay “impact
fees” based on their unconventional gas
august/september 2013 AmericAn GAs
19
Table of Contents for the Digital Edition of American Gas - August/September 2013
American Gas - August/September 2013
Contents
President’s Message
Subject Index
Dual-Fuel CNG Beauties
Digest
Issues
Issues
Issues
Need to Know
By the Numbers
Places
In Las Vegas, Another Man-Made Wonder
State House
State House
Elm Street
Main Street
A Matter of Trust
Profile
Here Comes the Grid
Marketing
Jobs
Vendor News
Marketplace
Headway
American Gas - August/September 2013
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