Propane industry seeks fair treatment7/3/2012
The province should allow propane companies into the pipeline business if it decides to open up the natural gas distribution market, a propane industry lobby group says.
The Canadian Propane Association recently wrote the provincial Energy Department to express its concerns about a proposal to start trucking compressed natural gas in Nova Scotia.
“We want to highlight the need for . . . a level playing field," association president Jim Facette said last week from Calgary.
Compressed natural gas, or CNG, became an issue this spring whenHeritage Gas asked the provincial regulator to allow it to build and operate a gas delivery system using trucks.
Heritage plans to spend $14 million setting up facilities to truck natural gas to two Hantsport companies,Minas Basin Pulp and Power Co. Ltd. and paper- plate makerCKF Inc .
Other companies, including J.D. Irving Ltd ., Irving Oil and Halifax- based Floating Pipeline Co ., have also told the province they’re interested in trucking natural gas around the province.
While Heritage has the exclusive right to deliver natural gas by pipeline to certain parts of Nova Scotia, including Halifax Regional Municipality and the Amherst area, the province says it’s not clear whether trucking compressed natural gas is included in regulations governing the industry.
Heritage Gas says it will fight any such move to open the natural gas market to others.
The province hired Bill Lahey, a Dalhousie University professor, to review the matter this spring.
The Energy Department says it recently received Leahy’s report and will soon respond to its recommendations.
“We don’t have a date yet," Murray Coolican, the department’s deputy minister, said Thursday.
One possible outcome is moving regulation of the industry away from province’s Utility and Review Board and opening it up to non-franchise compressed natural gas trucking.
If that happens, Facette said the province should treat the propane industry the same as it does the compressed natural gas sector.
“We think it’s cost competitive," he said. “The propane is already coming in. It’s already being trucked."
The Ottawa-based association has 365 members across Canada, including about 25 in the Atlantic region. Gary Highfield, general manager ofWilsons Home Heating , is among those who would like to see propane distribution rules changed.
He said the company has tried to get propane pipeline projects off the ground a couple of times but has had no luck getting Heritage or the review board to agree. “It’s been a bit of a frustration," he said. “We can pipe up a community with propane as cheaply as CNG. We’re quite confident."
In one instance, Wilsons wanted to build a distribution system in Truro’s industrial park, where it has a propane plant, Highfield said. The company was also approached by a Truro-area developer about hooking up a rural subdivision to propane but that proposal went nowhere.
“This is not new technology. This is stuff that’s been around since the ’60s," Highfield said.
Propane grids are common in housing or commercial developments in the United States, he said. There are some piped systems in Canada, including five in British Columbia, the national association says.
The propane industry also said the compressed natural gas sector should be subject to the same safety and transport rules that it is.
Coolican said those same rules would apply if trucking of compressed natural gas were allowed in Nova Scotia.
But when asked whether propane pipelines might become possible, the deputy minister said: “We looked at CNG."
(The Chronicle Herald)