PennEast will serve public for many years ahead

December 4, 2015

Hunterdon Democrat

The $1.2 billion PennEast Pipeline Project has created a robust debate around the need for new energy supplies into New Jersey. As the public evaluates the positives and negatives of pipeline projects, it should at least have factual information upon which to base its decision.

The approval of the PennEast project is important on many levels. Over $375 million per year in projected energy cost savings for New Jersey families and businesses. Cleaner air from a more environmentally beneficial clean-burning fuel.  Thousands of good jobs. Importantly, it fulfills one of the primary goals of the the state’s Energy Master Plan in 2011 to support new natural gas infrastructure into New Jersey.

A reliable, abundant and more affordable energy supply accessible just next door in Pennsylvania means we no longer need to rely on transporting natural gas from the Gulf of Mexico. This will enable us to both increase reliability and reduce costs not just for natural gas service, but electricity as well. That is a key point that is often missed, as natural gas continues to become a broader piece of New Jersey’s electric generation portfolio.

Criticisms from opponents often focus on the alleged lack of need for new natural gas supply in New Jersey and proclaim no justification exists for it to be built.

But that baseless refrain can and should be dismissed by the simple fact that approximately 90 percent of PennEast Pipeline’s capacity is subscribed by local companies and utilities that serve local customers – years before it’s even approved or built. To most independent observers, that market demand is undeniable.

The PennEast Pipeline primarily seeks to alleviate costly natural gas supply constraints, while greatly enhancing energy reliability for the future. During peak demand, as in cold winter months and following severe storms, prices skyrocket as the supply system becomes severely taxed.  

In fact, an independent study by Concentric Energy Advisors found that, had PennEast Pipeline been in service during the winter of 2013-14, New Jersey customers conservatively would have saved over $375 million in that one winter season alone.

Such price spikes are due to delivery bottlenecks in the region that drive up costs on power generators and large energy users, which have direct financial impacts on families, businesses and New Jersey’s overall economic competitiveness.

A report authored by Labyrinth Consulting and oft-cited by PennEast opponents alleges the pipeline would cause a New Jersey gas surplus of 53 percent.  This report was labeled as “problematic” and “incorrect,” and has been completely debunked by true energy experts for its overly simplistic assumptions and omission of key data.

The long and short is, many of the companies contracted to use the natural gas supply from PennEast are planning for growth not just for today, or next year, but for 10, 20, 30 years and beyond. As the largest and most affordable supply of natural gas has shifted from the Gulf Coast to the Appalachian region, and to Pennsylvania in particular, these underground pipelines are the safest and most reliable means available to deliver the fuel needed to meet New Jersey’s future demand.

There will always be voices who say “not in my backyard.” But the PennEast proposal is far too important to the public at large to be summarily dismissed by false data and conspiracy theories. It’s why the project is backed by some of the largest business and labor organizations in New Jersey and Pennsylvania, which understand just how important PennEast is to improving the environment, lowering energy costs, creating jobs and keeping New Jersey and its economy moving forward in the years ahead.

Rich Jackson

The writer is Executive Director of the New Jersey Energy Coalition