May 9, 2019 / 7:57 PM / a month ago

Con Edison in deal to boost natgas flows to New York on Iroquois pipe

May 9 (Reuters) - Consolidated Edison Inc said Thursday it reached an agreement with an existing pipeline to increase the amount of natural gas the pipe can deliver to Con Edison’s service area in New York City’s Bronx, Manhattan and Queens boroughs:

* Con Edison said demand for gas in its New York City territory has grown significantly in recent years as it converts heating systems from oil to gas, among other things.

* But New York state has not allowed construction of enough new pipelines to meet that growing demand, utilities have said, forcing companies like Con Edison to seek other ways to keep gas flowing to new and existing customers.

* Under the agreement announced on Thursday, Con Edison said Iroquois Gas Transmission System LP will deliver more gas to New York City by upgrading its compression facilities by November 2023.

* That is similar to a deal Con Edison announced in April with Kinder Morgan Inc, in which Kinder Morgan’s Tennessee pipeline will deliver more gas to Con Edison’s Westchester County service area by boosting compression. Westchester is located north of New York City.

* In March, Con Edison said it was forced to impose a moratorium on new gas customers in parts of Westchester to ensure reliable supplies for existing customers due to a lack of new pipelines in the state.

* Con Edison said it should be able to lift the Westchester moratorium around November 2023 when the new pipeline capacity is expected to be available.

* In April, Con Edison warned it may be forced to impose a moratorium in its New York City territory if Williams Cos Inc is not allowed to build its proposed $1 billion Northeast Supply Enhancement (NESE) project from Pennsylvania to New York.

* Even though NESE is designed to provide gas to another New York City-area utility, National Grid Plc, Con Edison said the two companies share some gas infrastructure.

* Con Edison said it has been concerned about the growth of gas pipeline infrastructure in New York since the state rejected Williams’ Constitution project from Pennsylvania to New York in 2016.

* Williams is still fighting that denial in regulatory and legal cases.

* U.S. President Donald Trump, meanwhile, issued an executive order in April designed to block states like New York from using federal law to slow construction of new pipelines like Constitution.

Reporting by Scott DiSavino

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