AGA: Natural Gas Utilities Are Delivering Answers to Our Nation’s Energy Challenges

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New York, NY – American Gas Association (AGA) Chairman Terry McCallister told an audience at the New York Society of Security Analysts today that natural gas should be the preferred energy source for the United States for decades to come because of our nation’s domestic abundance and the economic, environmental and energy security benefits that this clean energy source provides. Calling natural gas “America’s New Energy Foundation,” he described how natural gas utilities are helping their customers contribute to our nation’s clean and secure energy future.

McCallister recounted the top energy and environmental issues in our nation and outlined how natural gas utilities deliver energy solutions that are affordable and efficient.

“As the country continues to push for even cleaner energy and a more distributed energy model, natural gas utilities are delivering answers to these energy challenges,” McCallister said. “Our companies are built to meet the demands of the 21st century—and beyond—for our employees, our customers, our communities and the nation.”

The direct use of natural gas in America’s homes and businesses for heating, cooling, water heating, cooking and clothes drying achieves 92 percent energy efficiency. When discussing the efficiency of an energy source, you must take into account the full fuel cycle or journey from production to customer. Converting natural gas or any other fossil fuel into electricity to power comparable electric end-use products only maintains 32 percent of usable energy.

Households with natural gas versus all-electric appliances save an average of $693 per year and produce 37 percent lower greenhouse gas emissions.

McCallister continued, “It’s a tremendous time to be in the energy business and in the natural gas business in particular. In my 36-plus years in the industry we’ve never had opportunities like we see now. Natural gas utilities provide an essential service and have a unique ability to improve the world we live in.”

Terry McCallister is chairman and CEO of WGL and Washington Gas, its leading subsidiary, which has provided safe, reliable natural gas service to customers in the Washington, D.C. area for over 165 years. Today, Washington Gas serves more than one million customers in D.C., Maryland and Virginia.

EAO hosts open houses for Eagle Mountain – Woodfibre pipeline

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SURREY, BC – ​Representatives from the BC Environmental Assessment Office (EAO) and FortisBC were in Coquitlam and Squamish last week, meeting with community members and answering questions as part of the EAO’s review of FortisBC’s proposed Eagle Mountain – Woodfibre Gas Pipeline Project.

In Coquitlam, 36 people attended an open house at the Westwood Plateau Golf & Country Club on Feb. 12 to learn about the proposed project and speak with representatives from the EAO. Another 88 people attended the Squamish open house a day earlier.

“This was our chance to present the results of nearly two years of public consultation, and our exhaustive environmental and engineering studies,” said Cynthia Des Brisay, FortisBC’s vice president of energy supply & resource development. “Our goal is to ensure that the project will meet the needs of our new customer while providing benefits to the local communities.”

If the EGP project is approved, FortisBC will invest about $520 million to expand a portion of its existing Vancouver Island gas transmission system to provide transportation service to a proposed LNG facility southwest of Squamish. As part of the project, FortisBC is planning to build about 47 kilometers of new natural gas pipeline and a new compressor station in Squamish, as well as upgrade its existing Eagle Mountain and Port Mellon compressor stations.

In Coquitlam, residents were interested in the planned upgrades to the Eagle Mountain compressor station, including how FortisBC will reduce noise and emissions by installing electric-driven compressors.

Questions from Squamish residents mainly focused on the proposed pipeline route, the new Squamish compressor station, FortisBC’s safety record, and emergency preparedness.

Attendees at both sessions asked questions about how natural gas is sourced in B.C., including hydraulic fracturing, or “fracking”. The provincial government’s focus on developing a market for B.C. liquefied natural gas (LNG) has created an opportunity for British Columbians to better understand the province’s commitment to responsible resource development, including gas production.

In addition to construction-related job benefits, FortisBC says the project will benefit existing FortisBC natural gas customers in the long term.

“Our gas customers will benefit from the increased transportation of natural gas via the pipeline in the form of lower delivery rates,” said Des Brisay.

FortisBC’s full environmental assessment application is available for download atfortisbc.com/egp. EAO is accepting comments from community members until March 12.

What’s Going on with Natural Gas Transportation? Plenty!

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Conventional wisdom seems to index interest in natural gas as a vehicle fuel against the price of gasoline and diesel. With this in mind, we opened 2015 with our eye on the surprising crash in the price of oil, wondering whether enthusiasm for natural gas in either its compressed (CNG) or liquefied (LNG) form would wane with lower prices at the pump.

Turns out there’s still plenty of enthusiasm out there. Much of last week at the NWGA was spent engaging in conversations around the opportunity natural gas offers to help reduce transportation sector emissions, promote energy independence, and potentially save operators money in the long term.

Here are three interesting developments in the natural gas transportation sector from recent weeks:

 

1. Legislators are recognizing the benefits of natural gas for transportation:

Last Wednesday, we were in Olympia testifying before the Washington House and Senate transportation committees in support of House Bill 1396 and Senate Bill 5325. These bills aim to speed the adoption of natural gas, and other alternative fuels, in commercial fleets via incentives, rather than the punitive effects of a low-carbon fuel mandate.

Our testimony focused on the health benefits of conversion to natural gas. Transportation is the largest emissions producing sector in Washington. Natural gas vehicles can reduce CO2 by up to 30%, NOX by up to 88%, and particulate matter by as much as 30%.  Both NOX and particulate emissions aggravate breathing conditions, especially in the young and elderly.

Both bills enjoy bipartisan support and we’re looking forward to seeing how they progress.

 

2. More opportunities for natural gas fueling infrastructure are on the way:

Avista was granted the authority to sell compressed natural gas to individual customers in Oregon by the Oregon Public Utility Commission. What does this mean? Natural gas fleet operators will not have to build, own, operate and maintain the equipment required to compress natural gas for vehicle refueling. Instead, they can pay Avista to provide compression services as well as delivering natural gas to their location:

The service offering allows Avista to construct, own and operate dedicated CNG infrastructure that would be located on an individual customer’s premises for the purpose of refueling a commercial fleet of natural gas-powered vehicles. The costs related to the service offering would be borne by the CNG customer and will not impact the rates of Avista’s regular residential, commercial and industrial natural gas customers.

This agreement mirrors an arrangement the OPUC approved for NW Natural in January of 2014; Puget Sound Energy has similar approval in Washington. These agreements help remove one more hurdle as we work toward greater regional natural gas transportation adoption.

 

3. Fred Meyer’s LNG fleet has been a success:

Fred Meyer, a Pacific Northwest grocery chain, received plenty of positive press last year for their decision to convert a number of their Oregon based trucks to LNG. Last Thursday we had a chance to hear an update on their experience first-hand at a fleet management conference hosted by the Oregon Department of Energy and North American Fleet Association.

Ashley White, of Fred Meyer parent company Kroger, detailed some of the highlights from their first six months operating the LNG trucks:

  • Drivers love the quieter LNG engines and no more coming home smelling like diesel.
  • In terms of payload and operating range, LNG required little to no tradeoffs when compared to diesel, aside from the higher upfront vehicle purchase cost.
  • Until late in 2014 Fred Meyer was enjoying a significant LNG cost-benefit over diesel; however, the crash in oil prices and the expiration of the federal fuel excise tax credit for CNG and LNG have tilted things back in favor of diesel. Despite the recent price shifts, Fred Meyer is still beating the initial fuel cost projections made when the fleet deployed last year.

 

Stay tuned for more developments on natural gas transportation, especially as our region’s legislative sessions continue.

AGA: Latest Data Shows Increased Natural Gas Savings and Emissions Reductions

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Washington, D.C. – Americans continue to save money and improve their environmental footprint by using natural gas, according to the 2015 American Gas Association (AGA) Playbook, released today. The freshly updated guide for natural gas information shows that natural gas customers saved an average of $693 per year from 2012-2013 while reducing their carbon dioxide emissions by half a million metric tons. In addition, emissions from distribution pipelines dropped an additional six percent in 2014 as utilities continued to upgrade and modernize infrastructure to enhance safety.

“The discussion about our nation’s energy future must be fact-based, and the 2015 AGA Playbook shows that our nation’s abundance of natural gas continues to deliver environmental and energy efficiency solutions while providing reliable, affordable energy,” said AGA President and CEO Dave McCurdy. “With more than a century of expertise, natural gas utilities are a trusted resource for customers, policymakers, regulators and the media, as we all seek meaningful energy solutions.”

The AGA Playbook is the essential handbook for understanding natural gas and how local natural gas utilities are delivering America’s energy to help achieve our nation’s economic, environmental and energy security goals. The 2015 edition contains the latest facts and data surrounding natural gas and its role in American life, including information about pipeline safety, natural gas supply, and usage, responsible resource development, economic benefits, key facts regarding emissions, energy efficiency, cybersecurity and more.

Current national trends highlighted in the updated Playbook show that:

Natural gas customers are saving more money, more energy and emitting less carbon than ever before.

Average yearly savings for households using natural gas appliances increased $40 between 2012 and 2013. In 2013, households using natural gas appliances saved an average of $693 per year compared to households using other energy choices. Utilities helped customers save 136 trillion Btu of energy and offset 7.1 million metric tons of carbon dioxide emissions in 2012, an increase of 11 trillion and 0.6 million from 2011 respectively.

Safety remains a core value for natural gas utilities.

Pipeline incidents have declined approximately 40 percent over the past three decades as natural gas utilities continue to work to enhance safety. Natural gas utilities spend $19 billion annually and take a number of voluntary actions to help enhance the safety of natural gas distribution and transmission systems

Emissions from natural gas distribution systems continue to decline.

Emissions from natural gas systems dropped another 6 percent from 2014. In total, emissions from natural gas distribution systems have dropped 22 percent since 1990, even as the industry has added more than 600,000 miles of pipeline to serve over 17 million more customers.

Natural gas utilities continue to increase investments in energy efficiency programs.

Utilities invested $1.1 billion in energy efficiency programs in 2012 and 2013, an increase of $100 million from 2011.

More states are pursuing strategies to expand and enhance natural gas infrastructure.

Eight additional states are pursuing natural gas growth through innovative expansion proposals, growing the number from 17 states in 2014 to a total of 25 today. Meanwhile, 38 states have adopted specific rate mechanisms that foster accelerated replacement of pipelines no longer fit for service, supporting enhanced safety, reliability and performance of natural gas delivery systems.

The 2015 AGA Playbook also details the record performance of natural gas utilities during the winter of 2013-2014 and includes information on the latest natural gas utility initiatives to enhance safety, cyber and physical security and further reduce emissions, including the AGA Peer Review Program, the Downstream Natural Gas Information Sharing and Analysis Center and Voluntary Emissions Reductions Guidelines.

Avista Names Kevin Christie Vice President for Customer Solutions

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SPOKANE, WA–Avista Corp. today announced that Kevin Christie has been named as vice president for customer solutions. He will retain his current responsibilities in the areas of external communications, community outreach and philanthropy, as well as customer energy efficiency and conservation activities, and new products and services.

Christie has been with Avista for nearly 10 years, holding leadership positions in natural gas planning, natural gas supply, finance, and most recently as senior director of customer solutions. Christie also played a key role during Avista’s 2013-2014 acquisition of Alaska Energy and Resources Company and its subsidiary, Alaska Electric Light and Power Company.

“Kevin’s strong leadership, business acumen and work ethic will greatly benefit Avista and its customers. His depth of experience at the company will serve him well as he continues to lead our customer solutions group,” said Avista Corp. Senior Vice President and Avista Utilities President Dennis Vermillion. “He will be a valuable addition to our executive team.”

Christie holds a Bachelor of Arts degree with an accounting emphasis from Washington State University. In addition, he completed the Utility Executive Course at the University of Idaho and the Finance for Senior Executives program at Harvard Business School.

Christie serves on the board of directors for the Northwest Gas Association, the Northwest Energy Efficiency Alliance, the Providence Health Care Foundation of Eastern Washington and the Avista Foundation.

Prior to joining Avista, he worked for Gas Transmission Northwest (GTN), where he served as the director of Pipeline Marketing and Development, and as the director of Pricing and Business Analysis.

In addition, Christie has held positions in finance, business analysis, regulatory affairs and revenue accounting for PG&E Corporation, Pacific Gas Transmission Company and Chevron USA.

FortisBC finalizes LNG supply agreement with BC Ferries to fuel new vessels

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SURREY, B.C. – ​FortisBC announced today that it will provide up to 300,000 gigajoules of liquefied natural gas (LNG) per year, the energy equivalent of 7.8 million litres of diesel fuel, for the next 10 years to help fuel BC Ferries’ three new intermediate class ferries.

The LNG will be supplied from FortisBC’s Tilbury facility located in Delta, which recently broke ground on a $400-million expansion and the Mt. Hayes facility, located on Vancouver Island. The Tilbury expansion will add 1.1 million gigajoules of LNG storage and approximately 34,000 gigajoules of liquefaction capacity per day. The existing Tilbury LNG facility has been operating safely since 1971, and the Mt. Hayes facility has been in operation since 2011. The ships will be fuelled in the traditional manner that BC Ferries takes on diesel fuel, with trucks making deliveries to the vessels during non-operational periods.

The use of LNG by BC Ferries will result in the reduction of an estimated 9,000 metric tonnes of carbon dioxide equivalent per year, the same as taking 1,900 passenger vehicles off the road annually, because natural gas is cleaner burning than traditional marine diesel fuel.

“BC Ferries has taken the lead as one of the first passenger ferry services in the country to use LNG,” said Doug Stout, FortisBC Vice-President of Market Development and External Relations. “This abundant, made-in-B.C. energy source can reduce greenhouse gas emissions between 15 to 25 per cent, providing cleaner air for British Columbians.”

Announced by BC Ferries in 2014, the vessels are being built with dual fuel capability (liquefied natural gas and marine diesel), and will be replacing the Queen of Burnaby (Comox-Powell River) and Queen of Nanaimo (Tsawwassen-Southern Gulf Islands).  The third vessel will augment peak and shoulder season service on the Southern Gulf Islands route, plus provide refit relief around the fleet.

“We are pleased to collaborate with FortisBC, a safety leader in gas supply, for our new LNG vessels,” said Mark Wilson, BC Ferries’ Vice President of Engineering. “The use of LNG has both financial and environmental benefits and this contract will ensure we have a long-term, secure supply to power the new intermediate class vessels.”

FortisBC also provided $6 million in incentive funding toward the three new vessels, which was made possible following the creation of the Government of B.C.’s Greenhouse Gas Reduction regulation in 2012. Following those changes, FortisBC announced the $62-million program for fleet operators to offset part of the cost for a natural gas engine over a diesel engine.

“We’re working with FortisBC to establish the LNG transportation fuel market as part of our strategy to build and expand the province’s LNG industry,” said Bill Bennett, Minister of Energy and Mines. “Running ferries on LNG will reduce transportation costs, reduce greenhouse gas emissions, and grow the market for our abundant natural gas reserves.”

To date, the incentive program has resulted in commitments for almost 400 natural gas vehicles on the road or vessels in the water, potentially eliminating 38,000 metric tonnes of carbon emissions annually, the equivalent of taking 8,000 passenger vehicles off the road each year. To date, including this new commitment by BC Ferries, FortisBC has signed agreements for $28 million in incentive funding for land vehicles and marine vessels. With the current LNG price at Tilbury and Mt. Hayes the equivalent of $0.37 per diesel litre equivalent, FortisBC LNG for transportation customers are expected to significantly reduce their fuel costs.

The additional volumes of natural gas for transportation moving through FortisBC’s pipeline system benefit all natural gas customers. Better year-round utilization of FortisBC’s infrastructure, especially during the summer months when heating requirements are reduced, helps to keep natural gas delivery rates stable.

Oregon PUC grants approval for Avista compressed natural gas services

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SPOKANE, Wash.– Avista recently received approval from the Public Utility Commission of Oregon to offer business customers within its Oregon service territory compressed natural gas (CNG) services. The service offering allows Avista to construct, own and operate dedicated CNG infrastructure that would be located on an individual customer’s premises for the purpose of refueling a commercial fleet of natural gas-powered vehicles. The costs related to the service offering would be borne by the CNG customer and will not impact the rates of Avista’s regular residential, commercial and industrial natural gas customers.

“We’re pleased to have this service offering approved by the commission. It’s the next step in our plan to investigate the best uses of CNG, which is a cleaner, more efficient fuel for fleet vehicles,” said Dennis Vermillion, president of Avista Utilities. “We’re in the process of converting our own fleet of trucks to CNG. Over the past 24 months, we’ve built three high-capacity CNG refueling stations to service our own vehicles. Avista is committed to continuing to find ways of doing business that is environmentally responsible and cost-effective.”

Offering CNG services to businesses with a fleet of vehicles helps to advance Oregon Governor Kitzhaber’s energy plan, which calls for a 30 percent reduction of greenhouse gases by 2020. The increased availability of CNG in Oregon responsibly supports the state’s interest in improving air quality and lower greenhouse gas emissions. At the same time, it provides customers with the economic and operating advantages of using this alternative fuel.