NRDC Seeks Rehearing from NY Public Service Commission Order on Unnecessary, Costly NESE Pipeline

ALBANY, NY – NRDC (Natural Resources Defense Council) yesterday petitioned the New York State Public Service Commission for a rehearing of its September order finding the Northeast Supply Enhancement (NESE) gas pipeline is “needed” for National Grid’s downstate system. The Commission reached that conclusion despite National Grid’s 2025 demand forecast showing no demonstrated capacity need within the planning horizon.

The following statement is from Chris Casey, Utility Regulatory Director, New York, at NRDC (Natural Resources Defense Council):

“The NESE pipeline would lock us into decades more fossil fuel use amid a deepening climate crisis. Nothing in the record justifies locking New York City and Long Island families and businesses into billions of dollars in higher energy bills, more air pollution, and increased risks to water quality and marine ecosystems. This project is a giveaway to the gas industry that forces New Yorkers to shoulder the unaffordable costs. The Commission’s finding contradicts state law and the public interest, which is why we’re seeking a rehearing.”

Background

The proposed NESE project is an extension of an existing interstate gas pipeline intended to increase downstate supply capacity by 13 percent. National Grid has agreed to take 100 percent of that capacity under a 15‑year contract. The record in this proceeding demonstrated that National Grid's current gas demand forecast identified no need for additional capacity within the 20-year planning horizon. 

The record also showed that NESE would trigger a major rate increase of more than 3.5% increase to the average residential gas bill, and that the projected cost savings are speculative and insufficient to offset the pipeline’s fixed costs, resulting in a material net bill increase for households and businesses across New York City and Long Island.

The Public Service Commission’s order acknowledged the expected rate impact but indicated costs would be passed through to customers via an internal staff audit process—without a full evidentiary hearing, without public transparency into the true cost implications, and before a robust alternatives analysis is completed. 

NRDC’s rehearing petition asks the Commission to rescind its approval of National Grid’s contracting for NESE’s capacity, clarify that no prudence or cost‑recovery presumption attaches to this planning docket, and defer any determination on National Grid’s contracting for NESE capacity to an evidentiary hearing as required for all major rate changes under state law.

Comments filed by NRDC supported Synapse Energy Economics’ analysis showing that there is no evidence that NESE is necessary for system reliability—raising concerns about imposing unnecessary costs on customers.

NRDC (Natural Resources Defense Council) is an international nonprofit environmental organization with more than 3 million members and online activists. Established in 1970, NRDC uses science, policy, law, and people power to confront the climate crisis, protect public health, and safeguard nature. NRDC has offices in New York City, Washington, D.C., Los Angeles, San Francisco, Chicago, Bozeman, MT, Beijing and Delhi (an office of NRDC India Pvt. Ltd). Visit us at www.nrdc.org and follow us on Twitter @NRDC.