Natural gas pipeline extension could cut energy costs for state, Rockland businesses

Posted April 05, 2012, at 7:30 p.m.
Last modified April 05, 2012, at 8:15 p.m.

ROCKLAND, Maine — A major step in extending a natural gas pipeline to the Rockland area was reached Wednesday when the state signaled its intent to have a Scarborough company provide the fuel to the state prison facilities in Warren.

The state signed a letter of agreement with Self-Gen for that firm to provide natural gas. As part of the agreement, the company has agreed to extend the natural gas pipeline from Windsor to Rockland and Warren.

“This is good news, really good news for big industries in the Rockland area,” Rockland Mayor Brian Harden said.

David Emery, the deputy commissioner of the Maine Department of Administrative and Financial Services, said the details of the agreement are being negotiated but he expects an agreement to be reached in the next few weeks. The benefit to the state will be significant energy savings, he said.

And the potential for major energy savings for local businesses is what prompted a Dec. 19 meeting at Rockland City Hall when state officials and Self-Gen unveiled the company’s intent to provide natural gas to the Rockland area. At that time, however, Self-Gen had no customers for which to make the extension of the pipeline financially feasible.

The Maine Bureau of General Services issued a request for proposal in January for someone to provide natural gas to state facilities in the Rockland/Warren area, state facilities in Augusta, or both the Rockland and Augusta area, noted Alan Henry, the acting director of the general services bureau. He said there is no agreement yet on the Augusta area but the state signed the letter of agreement Wednesday for the state facilities in the Rockland/Warren area.

The state prison in Warren uses 400,000 gallons of heating oil each year at a cost of about $1.3 million. Another $850,000 is spent on electricity, Henry said.

The agreement calls for Self-Gen to initially truck natural gas to the prison but once the pipeline is completed, it would be received in that method. Self-Gen would also construct a small energy plant in which natural gas would generate electricity for the prison.

Emery said the savings would be significant, noting that natural gas costs are about one third of oil to provide the same amount of energy.

Once the pipeline is completed, private businesses can connect to the service if they want, he said. Emery said, however, the state will have no role in that since that would be discussions between private businesses.

At the Dec. 19 meeting in Rockland, Paul Aubrey, president of Self-Gen, said plans for the extension of natural gas could also mean the construction of a 25-megawatt natural gas generation plant that would be built near the Dragon Products cement plant in Thomaston that could then provide electricity for industries in Rockland and Thomaston.

Small generation plants could also be built at sites where there are large users such as Pen Bay Medical Center in Rockport; Walmart, which plans to build in Thomaston; schools; city and county buildings; Fisher Engineering; Hannaford; Lyman Morse; and downtown, according to the proposal unveiled in December.

Pen Bay Medical Center, however, has submitted an application to the town of Rockport to build a boiler that would burn wood chips. The Rockport Planning Board will hear that plan at its Wednesday, April 11 meeting.

In 2008, the superintendent of the Rockland wastewater plant, Terry Pinto, had encouraged the extension of a natural gas pipeline to Rockland to lower energy costs for the city. He attended the December meeting and voiced support for the plan.

Emery said his best guess on when the pipeline would be completed would be about two years. The state prison facilities, however, would expect to be using natural gas trucked to the Warren site in six to eight months.

Henry said the length of the agreement with Self-Gen will be negotiated.

In December, Aubrey said the most likely path for the pipeline would along Central Maine Power rights of ways or along Route 17.

The estimated investment by Self-Gen would be $150 million.

At the Dec. 19 meeting, Ken Fletcher, the director of the Maine office of energy independence and security, said there was no one silver bullet to solve the high costs of energy in Maine but that the natural gas proposal was one part. He said that lowering energy costs will make Maine businesses more competitive in the global market.

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