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Eversource CEO asks Biden to take emergency action on New England natural gas supply

“I am deeply concerned about the potentially severe impact a winter energy shortfall would have on the people and businesses of this region.”

The Everett LNG Facility. Jonathan L. Wiggs/The Boston Globe

The head of Eversource is sounding the alarm to President Biden, urgently requesting that he use emergency powers to ensure New England residents will have enough fuel to stay warm and avoid blackouts this winter. 

The concerns were expressed by Eversource President and CEO Joseph R. Nolan, Jr. in a letter sent to the White House last Thursday. 

“As both an energy company CEO and a lifelong New Englander, I am deeply concerned about the potentially severe impact a winter energy shortfall would have on the people and businesses of this region,” Nolan wrote. 

Despite Eversource and other entities accelerating work on large-scale clean energy projects like offshore wind farms and hydropower facilities, Nolan said that New England remains dependent on natural gas to meet power needs — both this winter and for the foreseeable future. 

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Nolan also cites concerns raised by ISO-New England, the region’s electricity grid operator, and the Federal Energy Regulatory Commission. For months, representatives from those organizations have warned that New England will not have enough natural gas to meet power supply needs if weather conditions bring a period of severe cold to the region. 

During the winter, the natural gas pipelines that serve New England typically operate at maximum capacity, according to information from ISO-New England quoted by Nolan. But if the weather gets very cold for an extended period of time, those pipelines cannot meet the region’s heating demands without “significant injections” of liquefied natural gas, or LNG. Both the gas distribution system and the electric power system in New England rely on imported LNG. 

The Massachusetts Department of Public Utilities said on Monday that natural gas rates would rise this winter between 11% and 27% compared to last year and based on location, WCVB reported.

While industry leaders have raised concerns about reliability in New England before, Russia’s invasion of Ukraine added new wrinkles to the equation. Normally, pipelines are supplemented by shipments of foreign LNG coming into a facility in Everett, according to Nolan. 

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“However, because of the war in Ukraine, imported LNG is not available to the New England region in the volumes necessary to meet this winter’s needs without causing further stress on European markets and the American economy,” he wrote. 

Further, Nolan warned that increasing New England’s reliance on foreign-sourced natural gas could indirectly benefit the Russian war effort. European shortages could be made worse if New England has to increase its reliance on foreign natural gas, according to Nolan. 

“More fundamentally, from a national security perspective, it will put upward pressure on prices in the international market for natural gas. As a major gas supplier, Russia will directly benefit from higher prices, and that in turn threatens to subsidize the Russian military and prolong the war in Ukraine,” he wrote. 

In his letter, Nolan suggested a number of actions for Biden and his administration to take as soon as possible. He pushed for an emergency order that would allow Secretary of Energy Jennifer Granholm to oversee new, temporary connections between energy facilities. Nolan asked Biden to waive the Jones Act, which mandates that goods shipped between U.S. ports must be transported by U.S. flagged vessels. The deliveries made to Everett are done by foreign-flagged vessels. 

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There were no U.S. flagged LNG vessels, as of Feb. 2020, according to Natural Gas Intelligence, meaning that LNG produced in the U.S. cannot be shipped to LNG import facilities in the country.

Nolan also urged Granholm to convene a group of federal officials, electricity regulators, LNG terminal operators, fuel suppliers, and more.  

“The need for action now is compelling,” Nolan wrote. “Many of the solutions require advance planning because they may require actions by regulators, finding new resources, chartering vessels, arranging for additional fuel deliveries, and other yet to be identified extraordinary actions.”

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