PSEG Has $2.5B Plan To Rebuild Its Gas Infrastructure, Pipelines

NEWARK, NJ — PSE&G’s major overhaul of its natural gas infrastructure is moving forward, including a plan to “modernize” nearly 1,000 miles of aging pipeline, the company says.

On Wednesday, PSE&G – which has a headquarters in Newark – filed for a three-year, $2.54 billion extension with the New Jersey Board of Public Utilities for its ongoing gas system modernization program (GSMP).

If it gets the green light, the proposal – the third phase of the project – will improve reliability and reduce carbon dioxide equivalent emissions by more than 145,000 metric tons, according to PSE&G. It will also allow the company to introduce renewable natural gas (RNG) and hydrogen into its distribution system, a move that PSE&G is promoting as a “balanced approach to decarbonization.”

Nearly two million PSE&G customers use natural gas for heat, hot water and cooking. Read More: PSEG Reports 'Strong Financial Results' For The Year

Here’s the gist of the phase three plan:

“PSE&G has about 3,000 miles of the oldest cast iron mains, with an average age of 91 years, in the country – more than any other American gas utility. GSMP III, which is planned to run from 2024 into 2027, expects to modernize about 860 miles of these cast iron pipes and about 200 miles of unprotected steel pipes.”

An estimated 310 miles (roughly 38 percent) of the low-pressure cast iron upgrades would be in towns and cities that have a “significant number of overburdened communities,” PSE&G noted. Read More: NJ Bill Gives Urban Areas A Powerful Tool To Fight Polluters

According to PSE&G, there would also be another benefit for New Jersey residents – their gas bills.

“PSE&G residential gas bills are now approximately 32 percent lower than in 2008, including Feb. 1 and March 1 decreases reflecting lower natural gas supply costs,” the company said. “If implemented as proposed, the program is forecasted to increase a typical residential gas customer bill by about 3 percent, or $3 per month for each year of the three-year program.”

• See Related: NJ Gas Bills Will Drop In February, PSEG Says (Here's How Much)

In addition to upgrading gas pipelines, the proposed project also includes two other components, PSE&G said:

RNG/LANDFILL GAS – “A proposed RNG facility would inject processed landfill gas into PSE&G’s gas distribution system. Compared to the natural gas supply chain, RNG is a less carbon-intense fuel. Our project is estimated to reduce GHG by approximately 27,000 to 36,000 metric tons of CO2e per year. The project would significantly improve regional air quality by reducing air pollutants annually, including tons of nitrogen oxide, carbon monoxide and sulfur dioxide. The inclusion of RNG is an important lower-carbon step in the transition to cleaner fuels.”

HYDROGEN – “PSE&G’s plan also includes a 1 MW-rated electrolyzer to supply 2% hydrogen to a part of the gas distribution system for the majority of the year. The electrolyzer would produce approximately 40 lbs/hr of hydrogen. The project would call for a flexible design in anticipation of increased blending in the future. It would reduce an estimated 1,000 metric tons of CO2e annually.”

NEW JERSEY SHIFTS TO CLEAN ENERGY

The third phase of PSE&G’s plan is being rolled out as Gov. Phil Murphy shifts the target date for the state’s “100 percent clean energy” goal to 2035, moving it up by 15 years. Read More: NJ To Require All-Electric Cars, 100% Clean Energy By 2035

By 2030, PSE&G hopes to reduce its methane gas emissions by 58 percent from 2011 levels, the company said. Through the first two phases of its GSMP program, PSE&G has reduced methane emissions by nearly a quarter of a million metric tons of [carbon dioxide equivalent] from its system, as compared to 2011 levels, the company says.

“PSE&G supports a balanced approach to decarbonization while meeting today’s energy demand – an approach that recognizes natural gas as a fuel to maintain affordability and reliability, as we continue to assess options including lower-carbon fuels and electrification,” president and chief operating officer Kim Hanemann said.

• See Related: PSEG Has 500 Open Jobs In Newark; 'Clean Energy' Fuels Hiring Push
• See Related: PSEG To Sell $2 Billion 'Fossil Generating Portfolio'

PSE&G referenced Gov. Murphy’s recent announcement on clean energy in a statement about its phase three plans:

“As our state and nation transition to clean energy, natural gas is expected to remain an affordable, reliable service energy source for many customers for decades to come. PSE&G’s decarbonization strategy includes aggressively pursuing energy efficiency, exploring alternatives to decarbonize the fuel supply, supporting the electrification of transportation – the state’s number one source of GHG emissions – and longer-term exploration of electrification where it makes sense.”

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