PUC backs contested Portsmouth LNG facility license. For now.

State utility regulators concur: Keeping, and expanding, a Portsmouth liquified natural gas (LNG) facility as a back-up heating source for Aquidneck Island is a good idea.

For now.

The immediate need may diminish as the state moves away from gas-powered heating. As such, the Rhode Island Public Utilities Commission (PUC) voted Wednesday to recommend that the facility’s license be up for review every five years, starting in 2028.

The commission is among a host of local and state agencies that have been asked to offer opinions on the controversial proposal to make permanent what has been a temporary LNG storage tank and vaporization equipment facility. The application by state utility operator Rhode Island Energy has drawn mounting criticism by residents and environmental watchdogs, who cite noise and safety concerns as well as state decarbonization mandates, as reasons for their opposition. 

The Rhode Island Energy Facility Siting Board, which has the final say over proposals to create or significantly change state energy facilities including this one, has been considering arguments both for and against the license application through a slew of preliminary public hearings and written testimony over the last two years. The siting board is expected to resume hearings this summer, after advisory opinions from agencies including the PUC have been submitted.

The PUC was specifically asked to review the need for and cost of the project ($15 million to build plus a $1.5 million annual maintenance cost, according to Rhode Island Energy).

That need is clear in the short-term, utility commission members agreed.

A single, 6-inch transmission line provides gas to Aquidneck Island. Coupled with a contractual limit on the hourly amount flowing through that transmission line, there is a clear shortfall between the available supply and what might be needed during peak hours in extreme cold weather.

Indeed, the temporary LNG site off Old Mill Lane was resurrected in late 2019 in response to the Aquidneck Island gas outage at the beginning of that year, which left about 7,000 customers without heat for a frigid January week.

The 70,000 gallons of LNG the company hopes to store at a permanent facility would be enough to provide gas to the island for 37 continuous hours, or three days of up to six hours per day when considering capacity constraints, according to the application. The permanent facility plans also call for relocating equipment away from the road and adding fencing and noise walls to minimize impacts to neighboring residents. 

“There is an immediate need and probably a short-term need,” Commissioner Abigail Anthony said. “That was clear in the record.”

But that record also hints that the future of natural gas on Aquidneck Island and across Rhode Island is dubious, at best. State decarbonization mandates under the Act on Climate law, combined with new sources of electricity including the upcoming Revolution Wind Farm, are expected to decrease reliance on and demand for natural gas. 

“That gives us reason to believe that circumstances may materially change in the not-too-distant future,” Anthony said. 

Attorney General Peter Neronha shared similar sentiments in prior, written testimony.

How much, and how quickly that happens remains unclear, though it is being explored  in a separate review by the commission. 

License review every five years

Without that clarity, commissioners didn’t want to give Rhode Island Energy carte blanche to operate an LNG storage facility forever. In a separate, unanimous vote, the commission agreed that a license application, if approved, should be subject to five-year reviews beginning in 2028 to determine whether the operations are still needed.

Periodic reviews of the license were also recommended by the Conservation Law Foundation through testimony submitted by its consultant, Earnest White.

The commission also backed Rhode Island Energy’s claim that the LNG storage facility was the lowest-cost, most effective solution, versus adding a second natural gas pipeline (as preferred by at least one member of the Portsmouth Town Council) or building weatherization and electric heat pumps (as recommended by a consultant hired by the town of Middletown.)

Commission Chairman Ronald Gerwatowski recused himself from the discussion and votes, as Gerwatowski also chairs the Rhode Island Energy Facility Siting Board. All advisory groups have until June 5 to issue their recommendations to the siting board. The board will resume final hearings on the licensing application 45 days after that, according to Emma Rodvien, the board’s coordinator. The board in its final decision must consider the project’s need, cost and environmental and socioeconomic effects, according to state law. 

Ted Kresse, a spokesman for Rhode Island Energy, said in an emailed response on Wednesday  afternoon that the company welcomed the commission’s opinion.

“We agree, the current seasonal use of this equipment is needed to ensure the safety and reliability of gas distribution service to our Aquidneck Island customers on the coldest winter days,” Kresse said.  “The facility plays a critical role in ensuring the reliable delivery of natural gas to our customers on Aquidneck Island, who depend on it to heat their homes and businesses.  As the EFSB process moves forward, we look forward to working with stakeholders to answer additional questions about the facility.”