In filings submitted to the Department of Public Utilities (DPU) on April 16, the Massachusetts Attorney General’s Office (AGO) and Department of Energy Resources (DOER) expressed concern about the climate effects of proposed utility supply contracts to keep the Everett Marine Terminal (EMT) LNG import facility operating until 2030. 

Despite their concerns, the AGO and DOER did not recommend the DPU reject the utilities’ petitions, noting that the contracts may be needed to support the short-term reliability of the state’s gas distribution network. Instead, the AGO and DOER called on the DPU to make any approvals contingent on additional transparency and long-term planning requirements (DPU 24-25, 24-26, 24-27 and 24-28). 

The contracts between four Massachusetts gas utilities and EMT owner Constellation are intended to keep the facility open through the winter of 2030. Everett’s main customer, Constellation’s Mystic Generating Station, is set to retire at the end of May of this year. (See Constellation Reaches Agreements to Keep Everett LNG Terminal Open.) 

With Mystic’s impending closure, Constellation can void the contracts if the utilities do not gain final approval from the DPU by May 1. This has led to expedited regulatory proceedings, in which state agencies and environmental groups have voiced concerns about the agreements’ projected $946 million price tag, as well as their alignment with the state’s decarbonization mandates. (See Everett LNG Contracts Face Skepticism in DPU Proceedings.)  

In initial briefs filed April 16, the AGO and DOER expanded on their cost and emissions concerns and recommended additional guardrails to ensure the agreements do not hinder the state’s emissions reduction efforts.  

“While the companies claim that the agreements are GWSA [Global Warmings Solutions Act] compliant, they have not provided any specific analysis to support these claims,” wrote the DOER. 

National Grid, one of the state’s two major gas utilities, projects its gas demand to increase by about 11% by 2030, and its agreement with Constellation would allow the company to buy increasing amounts of LNG over the course of the contract.  

The company argued in its initial brief that its agreement is needed to address “a deficit in the company’s available peak day and peak season resources.” 

“The proposed agreement will not trigger any additional demand for gas,” National Grid wrote. “Any changes in demand in the commonwealth are independent of this proposed agreement, and customers will have the same demand for energy regardless of whether this proposed agreement is completed.” 

Given the potential for gas demand to increase by the end of the agreements, the AGO stressed the need for the utilities to plan to develop an “exit strategy” from their reliance on Everett.  

“Since 2015, [National Grid subsidiary] Boston Gas has taken no overt actions to address its readily apparent dependence on EMT,” the AGO wrote. “The company’s appetite for EMT LNG is only forecasted to burgeon four-fold over the next six years.” 

Similarly, the DOER argued that “if the department approves the agreements, it should only be a short-term bridge to ensure reliability and must include a pathway to obviate each company’s need for EMT by the end of the contract terms in 2030.” 

Throughout the proceedings, climate advocates have voiced concerns that the timing of the agreements lines up with the in-service date of a major pipeline expansion proposal for the Northeast. (See Enbridge Announces Project to Increase Northeast Pipeline Capacity.) 

The DOER recommended the DPU require the gas utilities to detail plans to “eliminate their reliance on EMT” in their Climate Compliance Plans due in the spring of 2025. The DOER also urged the DPU to mandate annual reports on gas costs, volumes, and third-party sales associated with the agreements. 

These provisions are “essential in safeguarding consumers against the possibility that the companies would continue to be dependent on EMT in six-years or petition the department for approval of gas infrastructure alternatives that run counter to the Future of Gas principles or GHG emissions reduction mandates,” the DOER wrote. 

Meanwhile, the AGO recommended annual reports from the utilities on their efforts to eliminate reliance on Everett, as well as on whether the agreements have aligned with the state’s decarbonization laws and the DPU’s recent “Future of Gas” orders, which discourage additional investments in gas infrastructure. (See Massachusetts Moves to Limit New Gas Infrastructure.) 

Without such requirements, “ratepayers will again helplessly succumb to petitions by these LDCs [local distribution companies] for ongoing LNG supply from Constellation because, currently, these LDCs have no plan, obligation or intention [to] end their dependence on EMT,” the AGO wrote.