5.0 FUEL SUPPLY AND DELIVERY
5.1 Fuel Supply Setting
5.1.1 Project Combustion Needs
For the Project, the proposed primary fuel is natural gas. It is anticipated that the Project will use approximately 200,000 dekatherms (DTh) of natural gas per day. The natural gas will be compressed to approximately 500 pounds per square inch gauge (psig) prior to being supplied to the combustion turbines. Because the KeySpan system delivers gas at pressures between 125 and 250 psig, an on-site compressor will be necessary.
5.1.2 Gas Delivery
The Project site is near a 20-inch KeySpan natural gas line. It is expected that on-site compression will be needed. After metering, the gas will pass through moisture separators, gas compressors, fine mesh filters, and finally the combustion turbines. System reinforcements of the local distribution network are anticipated to assure deliverability of required volumes.
The local gas distribution system is currently owned by KeySpan. The system is linked to the KeySpan Long Island system and to the Con Edison gas system. Facilities in New York and western Long Island are jointly owned by KeySpan and Con Edison as the "New York Facilities System." The system is served by four pipelines, and KeySpan holds long-term firm transportation contracts on all of them. The four pipelines are Williams-Transco, Iroquois, Texas Eastern Transmission Corporation (TETCO) and Tennessee Gas Pipeline (Tennessee). KeySpan also contracts for underground storage and owns peaking supplies (LNG facilities) to meet gas demand. KeySpan's delivery capability is outlined in Table 5?1.
Table 5-1: KeySpan Local Distribution Capacity Pipeline Capacity(MDth/day) Underground Storage Peaking Supplies Total Firm Capacity 750 779 504 2,033 Note: Securities and Exchange Commission 10-K filing for 12/31/99.
With its capacity contracts on interstate pipelines, KeySpan is able to purchase natural gas from both Canadian and domestic sources. KeySpan purchases gas on both a long?term basis and on a daily basis in the spot market. Also, it purchases gas at various pricing points along the systems, anywhere between the supply basins and the New York City gate station.
Peak demand on the KeySpan West system is typically between 300 and 400 MDth/day - approximately half of total firm capacity. The record demand day on the system was January 17, 2000, with a demand of 1,079 MDth.
TGE has requested that KeySpan commence studies in order to determine what incremental system upgrades the demand caused by the Project would require, while protecting the local distribution network.
5.1.3 Oil Storage and Delivery
One of the primary advantages of the Project site is existing oil infrastructure. With on-site storage dedicated to Project use, the Project will be able to provide reliable energy even during cold-weather curtailment conditions. Delivery options to the site include the Buckeye oil pipeline thereby avoiding routine truck deliveries. The nominal delivery rate of the Buckeye Pipeline is 168,000 gallons per hour. Under short-duration peak conditions, the pipeline can increase this flow to 189,000 gallons per hour. The Application will present an analysis of the available capacity in the pipeline and on-site. The Application will also assess the Project's compliance with the Public Service Commission's Interruptible Gas Service Order, which is intended to protect "firm" natural gas customers - those for whom a steady supply is essential, such as residences, schools, and hospitals. The facility also has barge loading capabilities which could be repaired and reinforced to receive bulk oil deliveries.
In addition, the Application will provide details as to the necessary licenses, permits, and bulk petroleum storage handling protocols necessary for the Project.
5.2 Information Requirements and Methodology
TGE and KeySpan have begun discussions, and TGE has requested an interconnection study (flow, capacity, and other types of system impact studies), based on serving gas to the Project under KeySpan's service classification No. 20, Non-Core Transportation Service for Electric Generation. TGE will report the results of KeySpan studies in the Article X process. At this time, TGE anticipates the studies will evaluate both firm and interruptible transportation arrangements.
TGE proposes to include in the gas interconnection study for the Application the following: (a) meter and regulating facilities, on-site compression facilities, proposed pipeline route, pipeline diameter and range of operating pressures; (b) an identification of who will construct, own and operate the proposed gas interconnect; (c) range of estimates for gas consumption (peak hour, peak day, seasonal and annual); (d) whether the Project's natural gas transportation service will be firm, interruptible, or both; (e) an analysis of whether there is sufficient capacity to support the Project's requirements; and (f) a description of any necessary facility reinforcement.
On the basis of the above-described gas interconnection and capacity study, TGE will also identify its estimated annual number of days of fuel oil use and associated oil requirements of the Project. The study will include an estimate of oil truck traffic displaced from the neighborhood due to the closing of the Bayside oil terminal.
5.3 Initial Impact Assessment and Mitigation
TGE does not anticipate any potentially significant adverse impacts to the natural gas system because reinforcement of the distribution system will be designed to accommodate the Project as well as future system growth. TGE also anticipates no adverse impacts to oil distribution even during periods of high demand because of available storage facilities on-site.
Natural gas customers will not pay for Project-related reinforcements through their rates. KeySpan will define the incremental reinforcements required for the Project separately from other upgrades or maintenance in order to ensure that the capital cost of Project-related reinforcements is supported by TGE exclusively.