Hearings on future as ‘energy hub’ underway in Philadelphia City Council

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 Philadelphia Energy Solutions CEO Phil Rinaldi, PGW CEO Craig White and City Council President Darrell Clarke share a moment before today’s hearings on the future of Philadelphia as an energy hub. (Katie Colaneri/WHYY)

Philadelphia Energy Solutions CEO Phil Rinaldi, PGW CEO Craig White and City Council President Darrell Clarke share a moment before today’s hearings on the future of Philadelphia as an energy hub. (Katie Colaneri/WHYY)

Hearings on the city of Philadelphia’s future as an energy hub are underway in City Council. They began with a councilwoman’s tirade.

Councilwoman Marian Tasco began the hearings picking up where she left off during an interview on WHYY’s Radio Times last week. She says the Nutter administration gave the council no room to modify the sale agreement for the Philadelphia Gas Works.

“My council colleagues will remember, we asked repeatedly for all of the sale documents,” Tasco said, “not just the city and UIL’s asset purchase agreement. The administration refused to provide them. What did they tell us. They are confidential and you can’t see them.”

As to the future, council’s own consultant Andrew McBride of Concentric Energy Advisors says instead of getting most of its natural gas supply from the Gulf Coast as it does now, PGW should tap into Pennsylvania’s Marcellus Shale. 

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“It is expected and the markets are currently showing that Marcellus gas prices will remain among the least expensive in all of North America for the foreseeable future,” he said.

McBride says the city should also take advantage of the city’s liquified natural gas facility to help sell shale gas to other markets.

Another Concentric consultant Bob Yardley said if the city invests about $50 million in PGW they could improve the LNG facility to supply transportation fuel for the region.

“We believe the market is certainly showing signs of strengths and appears to be growing, we do believe that it’s an opportunity that should be seriously considered by the city no question about it,” he said.

However, Philadelphia Energy Solutions CEO Phil Rinaldi warned the council they could hold the city back from becoming an East Coast energy hub if they don’t act fast on PGW.

“There is a famous window of opportunity to make that location Philadelphia, but make no mistake – competition is closing that window,” he said. “The first region that gets in manages to get the gold.”

While several council members say they would consider forming a partnership between the city and a private company, Rinaldi believes that would be a difficult and lengthy process. But he agreed that selling PGW to UIL Holdings Corp. is not the only way to maximize the utility’s potential.

“The development of Philadelphia’s energy future does not depend on whether PGW’s regulated residential gas business becomes privately owned or remains municipally owned,” he said. “The important issue here is how to best get the developable assets of PGW into constructive ownership.”

But Council President Darrell Clarke told Rinaldi he’s not eager to rush into a deal that he fears could ultimately cost city workers their jobs.

“You can’t make a bad decision because you believe the clock is ticking and the window is closing because I’ve been there, done that,” Clarke said.

The City Council’s hearings continue Friday. Mayor Michael Nutter is expected to testify at another hearing called by the state Public Utility Commission.

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