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New York threatens fines over National Grid gas moratorium, orders gas hookups

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New York threatens fines over National Grid gas moratorium, orders gas hookups

New York regulators threatened millions of dollars in fines against National Grid USA and ordered the company to immediately restore service to more than 1,000 downstate customers impacted by an ongoing moratorium on gas hookups.

The order stems from the New York Department of Public Service's investigation into reports that National Grid refused to reconnect existing customers who had suspended service prior to the start of the moratorium. The DPS probe found deficiencies in National Grid's process for denying service and evidence that the company violated state law, Public Service Commissioner John Rhodes said in an Oct. 11 order.

"The law requires utilities to provide gas service without unreasonable qualifications or lengthy delay when sufficient gas supply exists, which the order alleges is the case for these previously existing customers of National Grid who found themselves suddenly cut off from gas without adequate warning and preparation," Rhodes said in a press release.

Rhodes gave National Grid seven days to provide gas service to 1,157 customers in New York City and Long Island or show cause why it cannot. He also ordered the company to submit a plan for taking additional energy efficiency and demand response measures, as well as a contingency plan identifying alternative supply and demand solutions to accommodate all disconnected customers. National Grid has 10 days to file the plan or show cause why it cannot.

National Grid also must show cause why the utility should not be fined within 30 days, Rhodes said. He ordered the DPS to expand an ongoing investigation into National Grid to "include potential negligence in not preparing for the months ahead."

National Grid noted that it would continue to work with the PSC but that it was "disappointed" by the order. "We stand by our analysis and there are very real gas supply constraints in the Northeast. In the meantime, we have been working to identify unprecedented temporary solutions to help mitigate this situation and will immediately begin connecting the more than 1,100 applicants who have been identified in the order," National Grid spokesperson Karen Young said in an emailed statement.

The company announced in May that it would not hook up any new customers in Long Island or New York City because the state refused to grant a critical water permit to the Transcontinental Gas Pipe Line Co. LLC system to increase supplies into the region.

"With the current regional natural gas capacity constraints, long-term guaranteed supplies are still needed to connect customers and to maintain the safety and reliability of the gas system for all customers," Young said.

New York Gov. Andrew Cuomo directed the DPS on Aug. 27 to look into the service denials to existing customers. He also told the DPS to consider alternatives to National Grid should the state decide to strip the company of its franchise to provide gas service in its New York territories.

"It is the fundamental responsibility of our utilities to provide reliable service," Cuomo said in the Oct. 11 press release. "National Grid has acted in bad faith throughout this process — first by denying over 1,100 eligible customers with service and now by failing to fulfill its core responsibility."