Natural gas pipe­line for Perth East, but Union Gas says sim­i­lar project not yet fea­si­ble for Welles­ley

The Woolwich Observer - - NEWS - FAISAL ALI

NEW GROUND WAS BRO­KEN in Perth East last week with the start of a $5-mil­lion pipe­line project that prom­ises to bring af­ford­able natural gas to that neigh­bour­ing town­ship.

The Union Gas pipe­line project will give the res­i­dents and busi­ness own­ers of Mil­ver­ton, Ro­s­tock and Wat­burg ac­cess to natural gas in the next year or two. Cus­tomers will have the op­tion to switch to natural gas, which the com­pany says can save them up to $1,500 a year on av­er­age on their heat­ing bills com­pared to us­ing elec­tric­ity, oil or propane.

“The avail­abil­ity of af­ford­able natural gas presents an op­por­tu­nity to sig­nif­i­cantly re­duce en­ergy costs for lo­cal cit­i­zens and busi­nesses and drive eco­nomic de­vel­op­ment and job cre­ation,” Perth East Mayor Bob McMil­lan said in a state­ment an­nounc­ing the project.

Suc­cess­ful ap­proval of Perth East’s pipe­line project may have fu­ture im­pli­ca­tions for the Town­ship of Welles­ley, which has sim­i­larly been pin­ing for a natural gas sup­ply for some time.

Ac­cord­ing to An­drea Stass, a spokesper­son for Union Gas, the pipe­line in Perth East was made pos­si­ble thanks to re­vi­sions to provin­cial reg­u­la­tions.

“What we know is the cost of ex­pand­ing gas ser­vice to some ru­ral and indige­nous com­mu­ni­ties – if they’re lo­cated a long way from an ex­ist­ing pipe­line, that cost can be more than cus­tomers, in our ex­pe­ri­ence, would be will­ing to bear, un­der the old reg­u­la­tory frame­work. So es­sen­tially it costs more to build the pipe­line than you can re­cover from cus­tomer,” ex­plained Stass.

Un­der the new reg­u­la­tions, Union Gas was able to levy an ad­di­tional charge on cus­tomers’ gas bills in Perth East to pay for the pipe­line. The going rate for natural gas in south­ern On­tario is 19 cents per cu­bic me­tre; but with these new reg­u­la­tions, Union Gas will charge Perth East cus­tomers an ad­di­tional 23 cents per cu­bic me­tre over the next 15 years to re­cover the costs of the pipe­line project. Even with this ex­tra charge, Union Gas says con­sumers can ex­pect a re­duc­tion in their heat­ing bills.

Be­sides that, un­der the new reg­u­la­tions, Perth East Town­ship will also be con­tribut­ing some of the prop­erty taxes paid by Union Gas it­self back into the project it­self. The end re­sult is that the com­pany is able to re­cover their ex­penses on the new pipe­line.

There is still no plan for a sim­i­lar project in Welles­ley, how­ever.

In­di­vid­u­als and groups of prop­erty own­ers in the town­ship have suc­cess­fully pe­ti­tioned for their own gas sup­plies, but there is noth­ing on a larger scale in the works.

The town­ship, for its part, is very sup­port­ive of in­di­vid­u­als in­ter­ested in ne­go­ti­at­ing their own natural gas sup­plies with Union Gas, said Kevin Beggs, di­rec­tor of pub­lic works, and is will­ing to ap­prove those

projects. Res­i­dents and busi­nesses in Welles­ley have to con­tact Union Gas, how­ever, and fund these projects on an in­di­vid­ual ba­sis.

A small pop­u­la­tion spread over a large area is one of the fac­tors po­ten­tially bar­ring Welles­ley from an af­ford­able, large-scale pipe­line project, said Stass. The costs of pay­ing for the pipe­line in­fra­struc­ture that would ul­ti­mately be passed on to the con­sumer would still out­weigh any sav­ings town­ship res­i­dents would hope to see.

More­over, the op­por­tu­nity to ap­ply to the prov­ince’s $100-mil­lion natural gas grant program, which the town­ship hoped could help fund a Welles­ley pipe­line, has lapsed.

The Perth East Town­ship pipe­line will take a few years yet to be com­pleted, and even longer to be­gin en­ter­ing peo­ple’s homes and places of busi­ness. By the 10th year of the project, Union Gas es­ti­mates the pipe­line will be at­tached to 625 res­i­den­tial build­ings, 41 multi-fam­ily res­i­den­tial, 66 medium and small com­mer­cial, and six large com­mer­cial build­ings.

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