NYSEG is planning to replace an aging 8-inch-diameter natural gas pipeline stretching from Norwich to Oneonta with a new 10-inch pipeline by 2020, according to documents filed with the state Public Service Commission.
The price tag on the project is $49.5 million.
NYSEG warns in its PSC filing that if the 25-mile segment that is part of the so-called DeRuyter pipeline is not replaced, "then the 3,500 customers in Oneonta will not be adequately served."
NYSEG has a pending application with state utility regulators for rate increases for both its gas and electricity customers.
If the DeRuyter line running from Norwich to Oneonta is replaced by the bigger pipe, it would increase capacity on that run by an estimated 38 percent, provided the Norwich compressor station remains in operation, NYSEG said.
Otsego Now, the economic development umbrella agency that includes the Otsego County Industrial Development Authority, has encouraged NYSEG to get gas from the proposed Constitution Pipeline. That line would carry enough gas to power an estimated 3 million homes a day in the Northeast, and would bring shale gas extracted from northeastern Pennsylvania to two existing pipelines in the Schoharie County town of Wright.
But NYSEG advised the PSC that it is focused on the plan to replace the existing 25-mile stretch of the DeRuyter pipeline bringing gas to Oneonta. The company noted that the segment of pipeline in question faces "threats" of external corrosion as well as "material/weld/joint failure" and is "undersized."
The weld seam and construction practices used when the DeRuyter pipeline was installed in 1953 "do not meet present day API (American Petroleum Institute) welding standards, construction records and documentation were not required or maintained from the time of construction and general construction practices of the period do not meet present-day regulatory requirements," NYSEG said in its submission last May.
The company acknowledged that the gas supply from the DeRuyter line "could be supported by interconnect to the Constitution Pipeline." However, the Constitution project has been held up by "ongoing delays and complications" from regulatory reviews, and alternatives involving the Constitution project have been "eliminated," NYSEG said in its filing.
It added, however: "Should Constitution be approved, the direct replacement of DeRuyter could be modified."
Alexander "Sandy" Mathes said NYSEG could be missing an opportunity to help spark business growth in the Oneonta area by not being aggressive in pushing to tap into the Constitution Pipeline to bring gas to Otsego County's most populous region.
Mathes called NYSEG's focus on the DeRuyter line "a short-term solution to a very serious problem. It doesn't sound like they have any long-term strategy."
"It's the intention of the IDA to pursue discussion with Constitution Pipeline to provide gas through any conduit or structure we can provide — with or without NYSEG," Mathes said.
NYSEG's largest customers in Oneonta, such as the State University College of Oneonta, have so-called "interruptable" service contracts with the utility, allowing NYSEG to tell them to switch to other energy sources on short notice.
Both Mathes and state Sen. Jim Seward, R-Milford, argued last week that the fact the existing NYSEG pipeline to Oneonta is often at capacity has stunted economic growth in the region, and suggested that tapping into Constitution could provide enough natural gas supply to meet the demand and propel growth.
Anne Marie Garti, an environmental lawyer and Stop the Pipeline organizer, challenged those assertions, stating, "You don't need a huge transmission line for local distribution."
Stop the Pipeline and a bevy of other environmental groups have been pressuring the state Department of Environmental Conservation to deny Constitution Pipeline's applications for water permits needed by he $700 million project. The Cuomo administration remains undecided on whether to grant those permits. The state is expected to make a decision by April.
In response to an inquiry from The Daily Star as to whether it has any intention to tap into the Constitution Pipeline to get gas for its Oneonta franchise territory, a NYSEG spokesman provided an email response that did not mention the Constitution project but did discuss the DeRuyter project. (DeRuyter gets its name from the Madison County town where the line originates.)
"Clean, economical natural gas is clearly the fuel of choice wherever it is available and it is a valuable economic development tool," NYSEG spokesman Clay Ellis said in his email reply. "We are well aware of the natural gas supply constraint in the Oneonta area and we are investigating options for relieving that constraint. Among those options is upgrading the DeRuyter line, an 8-inch steel pipeline that serves Norwich and Oneonta. This project is included in our most recent five-year capital plan filed with the New York State Public Service Commission."
NYSEG said its PSC filing that the idea of simply repairing the DeRuyter line was "not considered to be a viable alternative," given not only the condition of the pipeline but also that the the system load and pressure requirements dictate the need for a larger-diameter pipe.
"The replacement with a 10-inch pipeline will significantly reduce pipe material failure risk and need to utilize the compressor situated in Norwich and better accommodate the existing 7,000 and expected future customer load demand, allowing NYSEG to maintain adequate system pressure on the design day," NYSEG said.