Somerset County Economic Development Commission
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Somerset County, Maryland
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Natural gas decision expected by year-end
October 10, 2018
Natural gas decision expected by year-end 

By Richard Crumbacker

Crisfield-Somerset County Times

 

PRINCESS ANNE — If a proposal by Chesapeake Utilities to deliver natural gas to ECI and UMES is accepted by Maryland Environmental Service (MES), a new lower- cost energy source could be available to homes and businesses in upper Somerset County within three years. Chesapeake Utilities would be required to have gas line installed by Dec. 2021

 

The Dover-based company answered a request for proposals (RFP) by MES to bring natural gas to the prison so it could discontinue its chip-burning power plant, and to the university to eliminate its reliance on fuel oil. It expects to hear for Chesapeake. “We’ve been trying to get into Somerset for some time,” he said. “We’re very keen not to build a pipeline only for those two users” as “90 percent of our customer base is residential.”

 

The model Chesapeake would like to follow here is one that occurred in Delaware in 2012. A line 13.5 miles long ran from Milton to Lewes and connected Beebe Healthcare, Allen Harim Foods, SBI Pharma and Perdue. Along the way 2,200 residential and small commercial users hooked up.

 

Once in place natural gas attracts new businesses and can lead to business expansion, Mr. Holden said. In Cecil County an extension of 5.7 miles to serve a mushroom grower resulted in a second mushroom grower to open as well as a medicinal marijuana grower. In Princess Anne he would be interested in serving the town’s industrial park if it’s needed.

As for residential customers, compared to propane the savings can be $500 per year, he said, and “ bigger energy users save more money.”

 

To serve the county, however, Chesapeake must show it has customers that will essentially carry the load of the expansion so other ratepayers are not burdened by the system’s growth. Transmission lines that end at Commerce Street in Salisbury would be continued to Eden, and local distribution pipe would run south to Revell’s Neck Road to ECI.

 

“We could do the project with ECI only,” Mr. Holden said, and previous to the RFP the Department of Public Safety and Correctional Services already said by letter if natural gas was available it would seriously consider hooking up.

 

But without ECI, “ we could not make it an economical project.”

 

Although Chesapeake is the only natural gas provider on the shore, it must follow the state’s procurement process. Mr. Holden said, “It will save them notable money.”

 

Somerset County is being asked to approve an exclusive franchise agreement and Mr. Holden along with Director of Energy Services Shane Breakie met with the County Commissioners in August and provided them a draft contract which is still pending.

 

“They’ve asked us to hold until we get the RFP…then come back and talk about it,” Mr. Holden said. He would then request a similar arrangement with the Town Commissioners.

 

“To serve all of Princess Anne is an easy endeavor,” he said.

 

If regulatory hurdles and permitting go smoothly Mr. Holden said the timeline would be “quite a bit” shorter” than 2021, by maybe as much as a year. “We could have gas flowing in 2020….that’s a very viable target.”

 

The county and town would gain franchise fees and taxes on the new infrastructure. Chesapeake last year paid some $2.7 million in taxes company- wide, so “there is some revenue there.”

 

“I don’t want to stir the public up only not to have success,” Mr. Hold en said, “ but I’m optimistic.”

 

Interest in natural gas in recent times goes back to 2007, and four years later Mr. Breakie met with the County Commissioners about a draft franchise agreement but it was never finalized.


A company called Somerset Utilities received from the county a non- exclusive franchise in 2013 but it did not move forward and dissolved following a federal district court order in February 2016. It’s plan was to bring gas from Wicomico County south to the Pocomoke River so it would be available to Sysco.

 

If an arrangement with the town is approved questionnaires to residents would be distributed to gauge household interest in the service.




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