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'Addison Natural Gas Project' takes new steps forward

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Posted on July 12, 2012 |
By John Flowers



MIDDLEBURY — Vermont Gas has hired an engineering firm to further refine its plans to extend natural gas service from Chittenden County into Middlebury and Vergennes and has begun to contact potentially affected property owners along the project route in anticipation of filing its final application with Vermont Public Service Board (PSB) before the end of the year.

Vermont Gas officials confirmed the hiring of Clough, Harbour & Associates of Albany, N.Y., to do the design, construction management, survey, environmental, archaeological and cultural work on what is now being called the “Addison Natural Gas Project.” The plan calls for an extension of the Vermont Gas pipeline from Colchester into New Haven, then branching out into Middlebury and Vergennes. It is the first phase in the company’s ultimate goal of serving customers in Rutland County within around seven years.

“The clock is running,” Vermont Gas spokesman Stephen J. Wark said of the Addison County plans. “We’ve got a project.”

It’s a project that has drawn interest from businesses and households in Middlebury and Vergennes that have been seeking a cheaper heating fuel alternative than oil. Vermont Gas officials on Monday announced plans for an overall rate reduction of 3.6 percent, to take effect on July 21. This will be the 13th rate decrease Vermont Gas has passed on to its 45,000 customers since 2008, resulting in prices that are 40 percent less than fuel oil and 51 percent lower than propane, according to company officials.

The PSB has already given Vermont Gas permission to use some of its ratepayer revenue to help bankroll its proposed $58 million expansion project in Addison County.

“It is obviously something we are very excited about entering the next phase on,” Wark said. “We have been working on this for year, looking at the different potentials of building out into the region, trying to serve customers.

“The stars have lined up perfectly, we think.”

Demand for natural gas, he said, has been growing in recent years as the price of fuel oil has hovered near $4 per gallon.

“Those kinds of prices allow us to be very competitive; we know we have a market to go into,” Wark said.

He acknowledged natural gas prices might not enjoy such a competitive advantage over other fuel sources in the long haul, but he and his colleagues are optimistic. He noted continued political volatility in the Middle East — the world’s main oil producing region — a pattern he believes is likely to keep fuel oil prices high.

Meanwhile, natural gas is sourced in North America, Wark noted.

“It gives us a greater degree of stability and predictability,” Wark said. “That has allowed us to know that there’s a very good likelihood that if we invest in significant infrastructure that there will be many people here willing to take the service.”

The investment of $58 million is expected to allow the company to reach an additional 3,000 residential and commercial customers in Addison County. Vermont Gas currently serves customers in Chittenden and Franklin counties.

Specific plans call for Vermont Gas to extend a transmission line from Colchester, south along the Circumferential Highway route and then via the Vermont Electric Power Co. (VELCO) corridor through Essex, Williston, St. George, Hinesburg, Monkton, and potentially Ferrisburgh, into New Haven. In all, the buried natural gas pipeline would traverse 10 communities, according to Wark. It is likely that the larger, transmission-size pipe (10-inch-diameter steel) would culminate in Monkton, where it would continue south as a distribution line (still 10-inch diameter, but made of high-density plastic) into New Haven, Wark said.

Officials are still considering options on how to route the pipeline from New Haven into the targeted communities of Middlebury and Vergennes. Vermont Gas is scheduled to hold an informational meeting about its tentative plans on Tuesday, July 31, at 7 p.m. in the New Haven Town Hall cafeteria.

“We will work with community leaders in New Haven to try to find the best route to serve Vergennes and Middlebury,” Wark said.

NEW HAVEN ROUTE

The New Haven Planning Commission has drafted a letter to the selectboard recommending a preferred pipeline route running down Town Hill Road to Route 7. The commission did not see merit in Vermont Gas’s alternative scenario, calling for the line to run down South Street to River Road. Francie Caccavo, acting co-chair of the planning commission, said the panel reasoned that extending the pipeline via Town Hill Road to Route 7 would make it more accessible for natural gas tap-ons to existing commercial lots in that vicinity.

As a utility, Vermont Gas is obliged to provide tap-ons to prospective customers located within 100 feet of the pipeline. Those located in excess of 100 feet must pay for that tap-on.

Kathy Barrett, vice chairwoman of the New Haven selectboard, noted a potential hurdle for local customers. She pointed to local zoning rules requiring a 100-foot setback for development along most of the proposed route. So if the pipeline follows established roadways, it could preclude tap-ons for many consumers, she said.

Barrett also noted a general unease among New Haven residents regarding utility projects. The town recently took on more electricity transmission lines and related towers as part of VELCO’s Northwest Reliability Project.

“There’s a huge amount of trepidation,” Barrett said.

While she acknowledged that the proposed natural gas lines would be buried, Barrett said some townspeople are concerned that ready access to the lower-cost fuel could promote a sharp upswing in development — and possible sprawl — in town.

“After VELCO, people are more aware of the changing landscape,” Barrett said.

Wark said Vermont Gas will work with New Haven and the other affected communities with the goal of submitting an application to the PSB for a certificate of public good by December of this year. If all goes smoothly, Wark said the first Addison County customers could be receiving natural gas in 2014, with full service in 2015.

In the meantime, the company will have to sort out permitting and compensation for landowners through whose property the pipeline would traverse. Using the VELCO right of way should make that process a little easier, but still challenging, Wark acknowledged.

“The vision has been set,” Wark said. “Now comes the hard work.”

Reporter John Flowers is at johnf@addisonindependent.com.

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