Northeast Utilities customers are converting from oil to natural gas heating systems at a record pace with company executives suggesting that the extended stretch of low prices on natural gas is a driving factor in making the switch now numbered at 10,000 installations.
Natural gas currently enjoys a significant cost advantage over oil, with analysts expecting the trend to continue for the near future.
“Particularly in Connecticut, we”™re starting to see a lot of new construction starts, homes, condos, small businesses ”¦ (with natural) gas,” said Leon Olivier, chief operating officer of Northeast Utilities, in a conference call with investment analysts. “So we”™re ahead of where we thought we would be for this year and quite frankly, somewhat struggling to keep up with the demand and request from customers to connect them.”
for businesses and homeowners.
With NStar now part of the fold, Northeast Utilities reported a $44.3 million profit, including the impact of $91.5 million in charges related to the April merger with its Massachusetts counterpart.
The combined company produced $1.6 billion in revenue in the second quarter, with Northeast Utilities subsidiary Connecticut Light & Power Co. seeing a 2.4 percent drop in sales from a year ago, after adjustments for differing weather conditions.
Northeast Utilities executives attributed part of the drop to increased energy efficiency initiatives throughout the territories in which it does business.
The Connecticut Department of Energy and Environmental Protection (DEEP) is expected to release a comprehensive energy roadmap later this year. It remains to be seen whether the state will set up any new financial programs to defray the cost of natural gas systems for homeowners or businesses.
Connecticut Light & Power Co. is spending $300 million to make its lines and infrastructure more resilient to storms, following Tropical Storm Irene that hit nearly a year ago followed by the October nor”™easter. The state escaped major damage after conditions spawned a tornado watch in Litchfield County and brief but heavy wind and thunderstorms in Fairfield County.
Northeast Utilities is moving ahead with multiple projects to improve its ability to import electricity and move it within its territory ”“ most notably the proposed Northern Pass transmission lines to bring hydroelectricity from Quebec to southern New Hampshire.
New Hampshire”™s legislature this past spring passed a law stiffening any use of eminent domain. In Quebec, officials have indicated they have rights-of-way sufficiently lined up on the Canadian side of the border, according to Olivier. The company hopes to complete land acquisition in New Hampshire by the end of the third quarter and Olivier said the process is going “quite well.”
“We”™re down to a relatively few properties, but each one is owned by a unique person who has a unique interest around the property and unique needs,” Olivier said. “Obviously, as you move forward to that process, the marketplace changes as people become more aware of things, shall we say. But we think it”™s going very, very positively.
“When you don”™t have to use eminent domain, then obviously that makes it considerably easier,” Olivier said. “I think the bigger issue is that ”¦ we have to demonstrate what”™s in it for New Hampshire. We think ”¦ that there is hundreds of millions of dollars of value (for) New Hampshire.”
