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Regulation as Hand-to-Hand Combat

By Shane Sweet

I have often described the process of working legislation, engaging the regulatory community for a necessary change in rule/regulation or permitting a new facility as “hand-to-hand combat.” It is often a long, drawn out, messy, unpleasant, metaphorically bloody, unpredictable and frustrating process. It is also said that the “first causality of war is the battle plan,” which is to say nothing ever goes as planned.   If you have ever permitted a new bulk plant and struggled to get it done, you know of what I speak.

A couple of months ago in this space I touched on the issue of energy infrastructure. At the time, I was talking about the utilities. Clearly, they have their problems trying to build out infrastructure, but enough of them.

Storage: whether end-user storage at the point of use, secondary storage in your “yard” or at your local plant, or so-called primary storage serving local, state and regional supply they share one thing—storage is critical to us and our customers.

The good news is that we non-utility folk continue to pursue storage necessary to an efficient and responsive supply of our critical fuels. We have not given up, nor can we afford to.

The bad news is, as we seek to build that new plant or expand our storage capacity under the pretense that it is the right and responsible thing to do, it seems there is often someone or something that will fight us tooth and nail.

“The industry continues to pursue the need for sufficient infrastructure to meet the needs of its end-users,” said Jody Pratt of Ameden Energy Consulting. “However, sincere and responsible intentions on the part of the industry are often met with opposition,” she added.

Reasons for opposition are diverse. Maybe they don’t like our fuels; maybe they don’t want us in their backyard, or town, county, state, region or country; maybe they don’t want change in any way; maybe they are driven by some other agenda; maybe they work for someone averse to our interests.   Motives aside, delay and sometimes defeat of infrastructure development is real, costs time, costs money and directly impacts our industry and our customers. Immeasurable are how many projects never get off the drawing board, because we see what our brethren sometimes endure and say to ourselves: “Hell no, it’s not worth it.”

When I think of our attempts to develop prudent infrastructure a few come to mind, including the Sea-3 expansion in New Hampshire, Crestwood’s “Finger Lakes Project” in New York State and others.

Sea-3, a propane storage and supply facility, went through the approval process in Newington, N.H., to add 3 rail towers allowing them to offload 12 railcars per day, as well as to add four 90,000 gallon tanks where gas can be stored and then chilled by new compressors for storage in the large refrigerated tanks, according to Joe Rose, president and CEO of the Propane Gas Association of New England.

The City of Portsmouth immediately took legal action by appealing the Newington, N.H., Planning Board’s approval of the Sea-3 expansion plan. Rose noted that Sea-3 is offloading 6 rail cars daily now into the existing day tank, and moving the product into transports. It’s not over, yet.

“The Finger Lakes [propane] project is a critical, necessary, and natural component of the positive expansion of the shale gas movement,” said Rick Cummings, president of propane marketer Mulhern Gas of Hudson, N.Y., and president of the New York Propane Gas Association1. “The project moves us further into an era of low cost, clean energy,” Cummings added.

The proposal to use an underground salt mine for storage of nearly 90,000,000 gallons of propane continues to generate opposition by landowners, described environmental advocates and others.   The project’s proposed capacity is the equivalent of over 20% of the annual propane use for the entire state; arguably a critical contribution to propane industry in New York, if not the region. The project’s owners have had to contend with protests, the arrest of trespassers at the site and an on-going offensive of provocative declarations about the company, the industry and the project’s impact.

A public forum is set for February 2015; which is to say the project will not be online for this winter, but again, it’s not over yet.

Elsewhere, a company in Connecticut wanting to build a facility is now in its second town and third location as they attempt to gain permitting. Another, trying to permit a rail facility, also in Connecticut, was denied.

If your permit process feels like hand-to-hand combat, our respect, admiration and gratitude is with you.   Keep up the good fight.

1Full Disclosure: Shane Sweet holds the position of new executive/technical director for the New York Propane Gas Association effective Nov. 1, 2014

Bio:

Shane Sweet is an energy and management consultant with clients in the heating oil, propane and motor fuel sectors, a Partner with the firm of Lake Rudd & Company. As of November 1, 2014 he is the new Executive/Technical Director for the New York Propane Gas Association. He served the industry as President & CEO of the New England Fuel Institute “NEFI” from 2007 to 2011, and as Executive VP/Director and Lobbyist for the Vermont Fuel Dealers Association “VFDA” from 1993 to 2007 

CONTACT:

He lives in Shaftsbury, Vermont and may be reached at shanemsweet@gmail.com or 802-558-6101 cell/text. Suggestions by readers for future column content, as well as general comments, are welcome.

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