Winter Reliability Program

The much-discussed shortfall in natural gas pipeline capacity into New England has been largely mitigated this winter because generators—encouraged by low oil prices and incentives to lock in backup supplies of oil and LNG—are ready, willing and able to switch their dual-fuel power plants away from pipeline natural gas and onto oil and LNG-sourced gas if market conditions warrant. But now that prices for those fuels are more attractive, could switching to oil and imported LNG during winter’s coldest days and nights actually be a longer term solution to New England’s pipeline capacity problem instead of just a stopgap until new pipelines are built? Today, we begin a look at the changing economics of burning oil and LNG-sourced gas to help power New England when the region turns arctic, and what they may mean for proposed pipeline expansion projects.

The polar vortex events this past winter provided a jolting reminder to New England’s electricity sector that natural gas transmission infrastructure in the increasingly gas-dependent region needs further expansion. A comprehensive plan to ensure reliable electric supplies to Red Sox Nation for years to come is not yet in place, but more near-term fixes are being implemented and the elements of a long-term plan—new gas pipelines and new hydroelectric imports chief among them--are taking shape. Today we provide an update on gas-electric issues in New England.