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In a surprise move Tuesday morning, the Philadelphia Gas Commission tabled a vote on Philadelphia Gas Works’ proposal to replace its natural gas liquifier in Port Richmond, which would increase its capacity to liquify and store natural gas.
The commission’s staff had reviewed the proposal as part of the utility’s 2027 capital budget and recommended the five commissioners reject the $182 million project. The Public Advocate agreed.
“PGW’s proposal, which is capable of producing 1.1 [billion cubic feet] more [liquified natural gas] annually than its existing plant is oversized and could overburden PGW customers with unnecessary debt service expense,” Rob Ballenger, a Community Legal Services attorney who serves as the Public Advocate in budget proceedings, told the commissioners.
Ballenger said the utility does not need more capacity to liquify natural gas to serve its customers. He said he agreed with the commission staff that PGW’s plant and project designs are incomplete.
PGW has two liquifiers: the Richmond Plant in Port Richmond and the Passyunk Energy Center in South Philadelphia. The utility uses the facilities to liquify and store gas that it purchases during the offseason when it is cheaper for use during cold winters when demand is high.
Currently, the Richmond Plant has a capacity to produce 2.2 billion cubic feet and the newly proposed plant would be capable of producing 3.2 billion cubic feet. PGW is also negotiating a public-private partnership to fund the new plant, which, if successful, would negate the need for the $182 million in capital funds.
Andre Desant, an attorney for PGW, urged the commissioners to approve the utility’s entire proposed capital budget request of about $390.6 million and reject the staff’s recommendation not to approve the $182 million for the liquified natural gas, or LNG, plant. Desant told commissioners that approval for the plant was urgent, as the utility needed to have the liquefier operating by 2030 for safety and affordability.
“Without it, we not only risk exposing customers during the coldest winters to a possible harm, but we also have a situation where we use the LNG liquefier to avert problems with system failure,” Desant said.
He said the project proposal is the right size to avoid trucking needed LNG through the neighborhood.
“It doesn’t produce excess capacity,” Desant said. “It produces enough capacity. If you truck in the LNG, you’re basically dealing with the issue on an ad hoc basis, and we’re suggesting that you deal with it … as a plan.”
PGW and the Public Advocate disagreed over how much money, if any, the LNG plants saved customers.