Cuomo Gives National Grid 2 Weeks To End Gas Moratorium

ALBANY, NY — Gov. Andrew Cuomo is threatening to revoke National Grid's operating license as the utility giant refuses to activate new gas hookups in a standoff over a denied pipeline proposal. In a letter Tuesday to utility CEO John Pettigrew and President John Bruckner, Cuomo gave the utility two weeks notice of his plans to have state regulators move to revoke National Grid's operating certificate.

Cuomo said the utility failed to provide "adequate and reliable service," by not addressing supply issues, neglecting customer needs, stalling private development and diminishing associated tax revenues to local governments. National Grid mishandled the gas supply system on Long Island and New York City, Cuomo said, citing the moratorium.

"Your recent admission to the Public Service Commission that 'more could have been done to communicate with customers' effectively concedes that National Grid improperly denied service to over 1,100 households and is demonstrable evidence of both your inability to provide adequate service and take advantage of the public you serve," Cuomo wrote.

Cuomo said it's the utility's job to manage supply and demand.

"The very lack of supply you now point to as the reason for your denial of service to thousands of customers exhibits your failure to plan for supply needs," Cuomo wrote. "Your fundamental legal obligation as mandated by your certificate of operation was to plan and provide for future needs. You failed by your own admission."

National Grid implemented the moratorium on new accounts in March after state regulators denied plans to build a nearly $1 billion pipeline that would transport natural gas from Pennsylvania's shale gas fields to New York. Utilities have said the pipeline is necessary to meet demand. As such, National Grid and Con Edison implemented moratoriums on new hookups.

National Grid told Patch in a statement Tuesday it received Cuomo's letter and will review and respond to it accordingly within the governor's time frame.

"We continue to work with all parties on these critical natural gas supply issues on behalf of all our customers in downstate New York," the statement said.

The moratorium has left many homes and businesses floundering, including a Port Washington restaurant where the owner told Patch all he needed to open was a gas hookup.

Last month, Cuomo, a Democrat, ordered National Grid to provide gas hookups to more than 1,100 customers who were previously denied. At the time, he said the utility faced "millions of dollars in penalties" for failing to connect existing residential customers as required by law.

National Grid previously told Patch the State Public Service Commission's order to re-connect customers was limited. It applied to natural gas customers in downstate New York who had inactive accounts, had applied for gas service and were denied during the moratorium policy, which went into effect in May.

The utility noted it would be impossible to approve more accounts given the current constraints on gas supply.

On Tuesday, Cuomo appeared to reject that argument, saying the onus is on utilities to come up with solutions other than a gas pipeline to address supply and demand issues.

"In considering all the risks involved in such a pipeline coming to a timely conclusion, it was incumbent upon a competent and professional utility to explore and provide contingency plans and short-term and long-term options," he wrote.

He said the moratorium is either a phony device or outright incompetence.

"There is no legitimate need for it in the first place," Cuomo said. "There are existing short-term options to contract for non-piped gas from other sources, which National Grid either deliberately, negligently or incompetently did not secure."

National Grid should have looked into alternatives, including shipping gas via trucks, ships or barges, or proposing other infrastructure means or building more unloading facilities.

"Electric service and demand response measures could be proposed," he said. "Heat pumps and renewable sources could be proposed."

National Grid's actions violated state utility policy, Cuomo added. He also said the utility was either grossly negligent in relying on "speculative"construction of a pipeline to meet gas demand or deliberately defrauding New Yorkers by failing to develop or pursue existing supply options in efforts to strong-arm approval and reliance on a new pipeline.