Spectra Energy expanding its Northeast natural gas capacity
Houston-based Spectra Energy Corp., the primary owner of the Maritimes & Northeast natural gas pipeline between Nova Scotia and Boston, plans to spend $500 million to $1 billion to expand existing pipelines in New England with the Atlantic Bridge project, which will bring on up to 0.6 billion cubic feet per day of gas or more by November 2017.
In a Reuters news agency report published in the Bangor Daily News today, Spectra Energy CEO Greg Ebel said the additional natural gas pipeline capacity is needed to help New England power generators avoid the supply shortfalls and record prices experience last winter.
In the Reuters’ interview, Ebel also expressed his view that power generators, particularly those in New England, will need to “own some amount of capacity” by signing up for full-year contracts with natural gas providers to ensure they can meet peak winter demand.
“We increasingly see that power generators hold very small, in fact less than 15%, of the capacity to deliver on their obligations. That is not an acceptable situation, I think, for regulators and consumers,” Ebel told Reuters. “It’s important that power regulators and generators make sure that they do hold enough capacity to meet their peak obligation, which they are being paid to deliver.”
In Spectra’s second quarter earnings report, which was released on Wednesday, Ebel noted the company is pursuing $35 billion worth of projects nationwide that it expects to put into service by 2020, including $6 billion committed last year.
The Atlantic Bridge project — an expansion of the Algonquin Gas Transmission and Maritimes & Northeast Pipeline systems to connect abundant natural gas supplies in Pennsylvania and New York with markets in the New England states and the Maritime provinces — is among the projects with committed funding and an anchor distributor in Unitil.
“The company has committed anchor shippers and continues to pursue additional shippers for the project which will be an investment of at least $500 million with the possibility of that increasing up to $1 billion,” the company stated in its second quarter report.
The company also announced plans to further expand the Algonquin and Maritimes & Northeast systems — on their existing footprint. The project would provide improved electric reliability in New England by directly supplying approximately 60% of the region’s most efficient gas-fired power generation, according to Wednesday’s earnings report.
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