The findings of a PennEast Pipeline economic impact study were presented Monday by a panel of three experts making brief presentations at a breakfast held in DeSales University's university center and hosted by the Greater Lehigh Valley Chamber of Commerce.
The study was commissioned and paid for by PennEast.
It was submitted by Econsult Solutions, Inc., an economics, policy, and strategy firm headquartered in Philadelphia and by the economics school of the Lebow College of Business at Drexel University also in Philadelphia.
The presentations were headed by Peter Terranova, vice president of midstream services at UGI Energy Services, Inc.
"The lack of pipeline infrastructure is real," he stated. With regard to theproposed project, he noted PennEast recent co-locations have been raised from 26 percent to 50 percent of the pipeline with the use of existing right-of-ways.
Terranova said companies comprising the consortium such as UGI, PSE&G, and Spectra Energy Partners, to name a few, have no facilities to export natural gas overseas and no plans to build such facilities.
"You don't have to export gas to support this project, and there's more than enough reason to support this pipeline, " he remarked.
With most of the natural gas supplied by UGI used to heat Lehigh Valley homes coming from the Gulf of Mexico, Terranova pointed out gas from PennEast's pipeline will serve as an alternative supply to the area's service territory and increase the competitiveness to the supply.
Regarding the "Hellertown lateral", a 20-mile westbound branch of the pipeline to be located near the borough, Terranova said: "It will serve a good chunk of the Lehigh Valley and is a main feed to the Lehigh Valley's UGI gas system."
Econsult Solutions President Stephen Mullin said the study finds the PennEast project generates economic activity, employment, and spending in a six-county area between Pennsylvania and New Jersey.
Specifically, he said over the duration of the three-year project, $1.6 billion will be generated in direct, indirect, and induced spending by all affected parties.
Mullin said in total 12,000 jobs will be produced, resulting in paychecks to workers totaling $750 million. He added near 100 permanent positions will remain following the project's completion, resulting in an annual payroll of $23 million.
Additionally, he cited the accrual of federal, state, and local income tax revenues with Pennsylvania and New Jersey's combined personal income tax revenues totaling over $17 million.
"It's a crucial piece of infrastructure for the natural gas business that will last into the future," Mullin commented.
Paul Jensen, associate dean at Drexel University's LeBow College of Business, which employs Mullin as a business instructor, said the study does not attempt to quantify falling energy prices due to an increased supply of natural gas as a result of the pipeline.
Jensen explained the PennEast pipeline will allow utility consumers to save on their bills due to more a stabilized gas supply. He said that will result in increased disposable household income, adding for each $10 million saved by the public, a total of $13.5 million in economic impact could be generated.
With regard to project materials and supplies, Terranova said, "We will source out pipes and materials as close to home as possible. Our goal is to use local vendors as much as possible."
The 114-mile proposed pipeline is expected to be completed and in service by the end of 2017.
The full economic impact study is available online.
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