National Grid Secures Gas Rate Hike Attached to Controversial Brooklyn Pipeline

The decision was the first rate hike the state considered since passage of the Climate Leadership and Community Protection Act, setting a precedent for how New York might enforce the use of natural gas by corporations as it strives to reduce emissions.

On Thursday, the New York Department of Public Service voted unanimously to approve a rate increase for 1.9 million National Grid customers in the service area of a fracked-gas pipeline that has activists and environmental groups in a fury. 

The Public Service Commission approved a joint proposal allowing National Grid’s two gas companies, Brooklyn Union Gas Company and KeySpan Gas East Corporation, to increase their monthly rates by $5.56 and $4.89, respectively, from April 1, 2021 to March 31, 2022. The rates will increase again, by $5.35 for Brooklyn Union Gas Company customers and $5.45 for KeySpan customers, the following year.  

“In short, the joint proposal protects the company’s customers, maintains the company’s ability to obtain capital at reasonable rates, and enables companies to continue to provide safe and reliable service to customers,” said Judge James Costello to the commissioners at the meeting.  “The joint proposal does so, while remaining consistent with the environmental, social and economic policies of the commission and state.”

The decision was the first rate hike that the department considered since the passage of the Climate Leadership and Community Protection Act, a representative at DPS confirmed, setting a precedent for how the state might enforce the use of natural gas by corporations as the state strives to reduce its emissions.

The CLCPA, which was signed into law in July 2019 by Governor Andrew Cuomo, set aggressive climate benchmarks for the state, including 100 percent zero-emission electricity by 2040. Some legislators and city officials have suggested that National Grid’s pipeline, which the rate hikes fund, are in direct defiance of the CLCPA.

In 2019, the company started construction of a five-phase, seven-mile fracked-gas pipeline that runs from Brownsville to Greenpoint in Brooklyn. The pipeline has been a point of contention for environmental justice groups, who successfully lobbied for a halt on construction in December 2019 before the fifth phase of construction could begin. But by that time, the four other phases had been completed and were already transporting gas.

Last week, U.S Sen. Chuck Schumer joined protestors outside the National Grid facility in Greenpoint to publicly oppose the pipeline and rate hike. He accused the company of attempting to “thumb its nose” at the CLCPA.

In March 2020, City Comptroller Scott Stringer sent a letter to the company’s president, John Bruckner, saying that, “National Grid’s actions deeply threaten our progress towards a more sustainable future for our City.”

“Rather than committing to costly gas infrastructure, I urge National Grid to instead face the inescapable conclusion that meeting our climate requires a prohibition on the construction of new major natural gas infrastructure,” Stringer wrote.

The commission, though, said the joint agreement as approved is in line with the CLCPA. The 991-page document says that the company is required to prioritize the removal of leak-prone pipes, halt marketing of natural gas and provide education about alternative heating. But when questioned on the specifics of how DPS would enforce that, a spokesperson said simply, “We monitor the activities and books of utilities on a regular basis.”

National Grid will also have to conduct a study on how it will support emission reduction goals set forth by the CLCPA.

The adopted joint agreement notably discontinues construction of the last phase of the pipeline, but does leave an opening for it to be finished if the company first completes a review by an independent consultant and gets additional approvals from the state.

“If the consultant finds there is a need and would reduce emissions, the company can submit a petition seeking approval,” said the spokesperson for the Department of Public Service. That petition will be subject to public comment and reviewed by the [Public Service Committee].”

When asked if the company will seek approval for phase five development as outlined in the agreement, Wendy Ladd, a spokesperson for National Grid, sent City Limits a statement that did not directly address the future of the project.

“The Public Service Commission’s approval of the joint settlement on National Grid’s three-year investment plan will allow us to prioritize energy affordability while investing in programs necessary to maintain the safety and reliability of our natural gas networks and implement new programs to accelerate the transition to a cleaner energy future,” the spokesperson said.

“The company has not been actively marketing gas for a number of years due to continued strong organic demand for gas service,” she added. “We are, however, very actively engaged in marketing and sales efforts for our energy efficiency and gas demand response programs.”

Thursday’s decision was a blow to environmental groups who have long expressed concern that the CLCPA was not explicit or aggressive enough in limiting emissions produced by fossil fuel companies. They’ve called for lawmakers to pass the Climate and Community Investment Act, which was still sitting in committee when the state legislative session ended in June, and would impose a fine on corporations for emissions. A portion of those funds would be invested in environmental justice communities.

“I think it’s worth acknowledging that the idea that the legislature might ban the construction of any natural gas infrastructure, not just pipelines, is within the realm of imagination in the foreseeable future,” DPS Commissioner John Maggiore said Thursday.

The committee also announced in a press release that the rate hike they approved was significantly lower than what the company had initially requested.

Sane Energy, an environmental group that’s been protesting the project, released a statement in response to the approval.

“The decision of the Public Service Commission today is a continuation of environmental racism,” said Gabriel Jamison, member of Brownsville Residents Green Committee, in the group’s press release. “Since the state proved today that they do not believe Black lives matter, the people have to take actions, organize and mobilize and shut this pipeline down.”

The group announced it would hold a virtual town hall on Aug. 23 and echoed its previous call for customers to participate in a gas bill strike by withholding from their gas bill $66 — the total amount of the increase in the next year.

“The level of denial today was just really hard for a lot of us,” said organizer Lee Ziesche of Sane Energy in the hours following the vote Thursday. “To just have them ignore the massive community opposition to this, it’s been hard.”

Liz Donovan is a Report for America corps member.