Yankee Gas eyes first gas lines installed in the fall
Published 10:08 am, Thursday, April 24, 2014
Yankee Gas expects to lay down the first five miles of natural gas mains in New Canaan in the fall.
Paul Zohorsky, vice president of gas operations at Northeast Utilities, Yankee Gas' parent company, announced the news Monday during a forum on natural gas at the New Canaan Library. The event was co-sponsored by the New Canaan League of Women Voters.
Zohorsky said, however, he needs residents to indicate their interest on the utility's website to move the project forward.
"We need people to sign up because that tells us where we can expand," Zohorsky said. "The more interest we have, the quicker we can move and the more extensive we can make our system in New Canaan."
Zohorsky said at least 800 people, including residents and business owners, already have expressed interest on the website, newcanaan.iwantnaturalgas.com. He explained that by signing up online, a person is not committing to the service. He said the company is plotting the results from the website on a map so it knows where to focus its door-to-door campaign to get people to actually sign contracts.
"We're capturing the interest people have and where they have that interest, we're plotting it on a map ... and we're saying, `wherever there's the most interest, closest to where we have an existing main, that's where we're going to go next,'" Zohorsky said.
In December, town and Yankee Gas officials signed a memorandum of understanding for the implementation of natural gas in New Canaan. The gas would come from a pipe just to the west of town, in North Stamford. The current plan is to use several municipal facilities as "anchors" for the project.
The pipes would come through Frogtown Road, into the center of the town, hook up to the Town Hall and other town buildings, down South Avenue to the schools, the YMCA, and then expand as "tentacles" to secondary roads where there's the most interest.
Though the first mains should be installed within about two and half months, it would take much longer to reach residents on secondary roads, according to Zohorsky.
"This is not going to be a one-year project. Once you get the main in, you'll get people near the main who will be interested," Zohorsky said. "The tentacles will be spread out over time ... I look at this as a multi-year, probably three-to-five-year-, project."
One of the obstacles Yankee Gas has been facing is a new state regulation, part of the Governor's Comprehensive Energy Strategy plan. The plan, which was adopted in 2013, introduces a "portfolio" approach to gas extensions requiring that 60 percent of the customers commit to gas service before construction starts.
"We have to get 60 percent of the revenue associated with the expansion ... before we can dig," Zohorsky said. "That's a challenge."
The goal of the regulation is to allow more customers to cost-effectively connect, since it would reduce up-front costs, according to the state's Public Utilities Regulatory Authority.
Despite slowing down the project, the new requirement makes the conversion more affordable, according to First Selectman Robert Mallozzi, a panelist at the forum.
"That has complicated things," Mallozzi said. "But what's important is that we get the best deal for the town, do it safely and bring it in on time."
Chamber of Commerce Executive Director Tucker Murphy, another panelist, urged Yankee Gas to do a better job of informing the community of the project's status. She said the utility's communication "has been minimal, at best."
"We need more information and we haven't been getting it," Murphy, who also serves on the Town Council, said.
Zohorsky said the response has "been a little slow" because Yankee Gas had to get its "arms around these new regulations," but he said the company would start sending out monthly updates to those who have signed up via the website and would start meeting with Mallozzi on a weekly basis.
"You're going to start seeing a lot more energy in the town," he said. "And I apologize for the delays we've had."
In order to get to the 60 percent revenue threshold, Zohorsky said Yankee Gas is going to have an intensive marketing campaign to promote natural gas in New Canaan.
Members of the audience, who submitted questions through index cards at the forum, were interested in how much it would cost them to convert to natural gas. Zohorsky said customers who live less than 150 feet from the gas main may not have to pay for anything besides converting their own heating unit, which varies by property.
The typical customer converting to natural gas could save up to 50 percent on fuel costs, according to Yankee Gas. Additionally, the closer the property is to a main, the lower it would cost for connecting.
Mallozzi said economics is one of the key reasons the town is interested in switching to natural gas. He said converting the town buildings and schools to natural gas could result in savings for the annual budget. "The ability to fire them up with gas is economically a good decision, in my opinion," he said.
Mallozzi noted that it would be economically viable for "business owners and condo owners to piggy-back on the town buildings."
"While we're doing the town, that's the time to hit these (secondary) streets off of the main lines and get folks in their homes to take advantage of gas," he said.
Mallozzi also said natural gas eventually would bring self-sufficiency and energy independence for New Canaan and would eliminate propane tanks, which often are a hazard, he said.
Mark Robbins, real estate and energy consultant with Clean Energy Finance & Investment Authority and consulting partner with Commercial Property Assessed Clean Energy, said the town is heading in the right direction.
"You have the opportunity for a cleaner, more efficient burn-fuel source," he said. "It's continuous supply versus periodic delivery on call by trucks."
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