Q&A with Nick Stavropoulos of KeySpan Energy Delivery
KeySpan, the largest distributor of natural gas in the Northeast, has installed more than 220 miles of pipeline across Cape Cod over the last five years. It is now proposing to construct 13.1 miles of natural gas pipeline to reinforce its existing Sagamore line. The proposed line crosses sections of Sandwich, Barnstable, South Yarmouth, Dennis and Harwich.
This latest proposal, approved by both the Massachusetts Energy Facilities Siting Board and the Executive Office of Environmental Affairs, would spread construction over 10 years and meets environmental requirements and regulations.
However, the Cape Cod Commission opposes the measure and is seeking a change in route that would be more costly for customers. Some Yarmouth officials also oppose it.
“The fire chief and public works director opposed the KeySpan proposed route because of significant concerns for safety whenever road or utility work requires digging along these roads. The alternative route is through an unpopulated area that would not require future digging,” said Yarmouth Selectwoman Susan McAuliffe.
Cape Business recently interviewed KeySpan Energy Delivery President Nick Stavropoulos for his view of the project.
Why is this upgrade necessary? Who benefits from it?
KeySpan has experienced an increased demand for natural gas on Cape Cod. The project will help maintain system reliability, eliminate any pressure problems and enhance delivery capability. Currently, there is the potential that our customers on the Lower Cape might experience some problems on extremely cold days, but the reinforcement would eliminate that probability. The reinforcement will reduce identified bottlenecks that impede the efficient and reliable flow of gas.
Is there a deadline for its construction?
The problems with the current system need to be rectified as soon as possible. The proposed system upgrade will ensure that we proactively meet our customers’ demands while delivering our product in the safe and reliable manner each customer expects of us. Any reactive measures, such as additional trucking of LNG, that we undertake during delays are less reliable and will have more impact on the Cape. The project has already been severely delayed by the opposition of the Cape Cod Commission. Had we proceeded under our original timeframe, the project would already have been completed.
What is the alternative route, and what makes it so much more expensive?
The 4.6-mile alternative route would run from our LNG facility in South Yarmouth, easterly on the old Bay Colony Railroad right-of-way approximately 2.6 miles (including crossing the Bass River into Dennis), 1.3 miles easterly on the Cape Cod Rail Trail to the intersection of Depot Street in Harwich, and proceeding north on Depot Street to the Main Street intersection.
The Cape Cod Commission and the towns have advocated for that route as the preferred alternative even though it was previously reviewed and rejected by the EFSB. It involves substantial construction in order to cross the Bass River into Dennis to Great Western Road to the intersection of Depot Street and again tying in at Main Street. The estimated $2 million additional cost would include more than $1 million for an easement (present value) from the Executive Office of Transportation for locating the pipeline along the railroad right of way. In addition, the Bass River crossing would cost between approximately $1.5 million (for a new utility bridge) and $2.2 million (for directional drilling under the river) more than the route already approved by MEPA and the EFSB.
Other offsetting costs between the approved route and the alternative are dwarfed by these two additional cost items. We also cannot forgo the far greater environmental costs associated with the alternative route. The alternative route would disturb substantially more linear feet of rare and endangered plant and animal species habitat. Beyond the river crossing, there are also additional impacts on wetlands that will need to be mitigated.
Why should the Cape’s business community care where the pipeline is built?
Locating the pipeline along the route already approved by the state is the lowest cost, most reliable and environmentally friendly option. Natural gas is the fuel of choice for the growing Cape business community and other businesses across the Northeast. Having a safe and reliable natural gas delivery system is critical to supporting continued economic growth for the region. With natural gas, businesses don’t have to worry about leaking underground storage tanks and the potential for polluting the Cape’s fragile sole source aquifer. Also, we are increasingly seeing companies become more proactive when it comes to managing their greenhouse gas emissions. Switching to natural gas is a great way to reduce carbon emissions and help prevent global warming. Smart companies are also looking down the road and saying: “If we are going to face the possibility of a carbon tax or other regulation, I want to be ahead of the curve and lower my emissions as much as possible.”
How much more would it cost businesses for their natural gas if you were forced to build an alternative route?
Assigning specific recovery costs that customers would bear would be the job of the Department of Public Utilities, however, the expense would be shared by our 89,000 residential and 8,300 commercial customers in our Cape Cod service area. I think we can all agree that $2 million in additional costs is a significant number to be absorbed.
Critics claim KeySpan saves the $2 million by building the pipeline under current roadways instead of an alternative, less populated route. But your savings will mean the town of Yarmouth is left with patched-up streets. If you spent more to repave the roads, you would not save the $2 million. Is that a fair argument?
KeySpan adheres to strict pavement restoration standards on each job undertaken. Our work is regularly inspected to assure that quality is maintained. Utilities are routinely located within the traveled way or the soft shoulder of the road. The street restoration costs are already included in the overall project proposal, and the repaving demanded by Yarmouth would further inconvenience traffic and businesses in the area.
Beyond the economic issue, critics argue that building the pipeline in a populated area poses a safety issue that would not be the case in the less populated alternative route. Fair or unfair?
This is absolutely unfair and untrue. KeySpan safely maintains 12,000 miles of pipeline in 116 towns in Massachusetts, including Cape Cod. That infrastructure is parallel to, above and below other utilities in rural, suburban and urban streets. We adhere to and implement stringent safety policies in each street we utilize and routinely inspecting all pipelines. This pipeline will exceed state and federal codes.
If you can’t build under your preferred route, will KeySpan proceed with the alternative one?
KeySpan will look for ways to make the project operate as smoothly as possible. KeySpan has and continues to meet with local community and elected officials to review the construction plans and to seek ways to minimize the impact on Cape communities. The preferred route has met strict criteria of appropriate regulatory entities. We believe we have provided the best route in terms of service, cost and environmental benefit. It is the best route for all involved.
Published in Cape Business May/June 2007
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