Westchester officials eye impacts of Con Ed’s natural gas moratorium on construction projects

Yonkers officials celebrated in October when it appeared the city finally had a developer ready to build on a 6-acre patch of its downtown called Chicken Island, which has sat vacant for decades. Four months later, they are warning that Con Edison”™s natural gas moratorium could snuff out the plan.

Yonkers Mayor Mike Spano said “as soon as the potential developers of Chicken Island heard of the gas moratorium, they expressed to us that, unequivocally, moving ahead with this moratorium will stop their development. Period.”

Developer AMS Acquisitions LLC, a Manhattan firm, agreed to buy the property from the city last year for $16 million. The company promised a plan featuring shopping, dining, apartment buildings and a luxury hotel for the site behind City Hall.

But Chicken Island is just one of many development opportunities Westchester County elected officials fret could be lost or at least delayed during a natural gas moratorium in Westchester County. Con Edison says demand has outpaced its capacity to get natural gas into its lower county service area, requiring the company to pause all new natural gas connections starting March 15.

The proposed moratorium has flipped perception in Westchester”™s largest cities. Public officials in Yonkers, New Rochelle and White Plains have spent the past couple years touting the large number of apartments planned for their cities. They now list the same numbers to lament what could be lost.

“I”™ve seen what happens on the development side of things,” said White Plains Mayor Thomas Roach. “A window opens and a window closes.”

Both Roach and Spano, through an office representative, testified to the potential costs of the moratorium at a public hearing hosted Feb. 13 in White Plains by the state”™s utility regulator, the Public Service Commission.

Westchester County Executive George Latimer said his office has compiled a list of commercial development projects that could be halted in the moratorium. Without natural gas, 16,000 new apartments and condos and 2 million square feet of new commercial development could be at risk. His office estimates the lost development could cost the county 28,500 construction jobs, 48,000 residents and more than $600 million in rental income.

“Developers that are looking at Westchester County for any type of construction ”“residential, commercial of any sort ”“ will be dealing with one county that has a moratorium and no other area that does,” Latimer said at the public hearing.

The moratorium, he said, gives an advantage to “Long Island, Fairfield County, the Hudson Valley and northern New Jersey, all at the expense of Westchester County.”

Con Edison has told developers and public officials that new gas connections will be approved until the utility decides it has reached capacity, which could happen before the March 15 cut off. That”™s created a race to get in before the gas runs out. A Con Edison spokesperson said the utility has received more than 580 requests for natural gas connections since the announcement, twice the normal rate of incoming requests compared with the same period in the past two years.

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Patrick Lynch, president of OLA Consulting Engineers in Hawthorne, said his firm has worked on about a dozen applications ahead of the moratorium for developers and other commercial builders. His firm has sped up the typical timeline in each case to provide estimates of expected gas load to Con Edison.

“For a developer these are little costs, but they are costs they are incurring earlier in the project than they would have without this March 15 deadline,” Lynch said.

Con Edison has state approval to launch a $223 million effort aimed at boosting the use of heat pumps and gas efficiency measures in the region. OLA Consulting plans to explore gas alternatives such as all electric options and geothermal heating. But Lynch said there can be challenges for each option and the best alternative will vary by project.

“It really limits people”™s options not having gas,” Lynch said. “If you talk about a 15- to 20 story apartment building in New Rochelle and White Plains, you really want to have that gas option.”

There is one type of gas service Con Edison will approve even in the moratorium. The utility will still connect new buildings if they use interruptible service, an option that allows Con Edison to switch the building to oil on peak days. The option is utilized mostly by large commercial or industrial facilities, but isn”™t particularly common. Less than one percent of Con Edison”™s 1.1 million natural gas customers are interruptible, according to the utility.

There has been plenty of finger pointing among elected officials as the March 15 deadline nears. Democratic state Assembly members Amy Paulin and David Buchwald slammed the PSC at the White Plains hearing, arguing the regulatory board did not give the public proper notice of the potential for a moratorium. County Legislator MaryJane Shimsky, a Democrat representing Hastings-on-Hudson, added that Con Edison had “bungled the situation” and placed the economic health of Westchester”™s communities at risk.

Gov. Andrew Cuomo has taken heat as well. The editorial boards of The Wall Street Journal and New York Post described the moratorium as a consequence of his opposition to natural gas pipelines in the state.

Latimer, meanwhile, is calling on the state PSC to work with Con Edison to delay the March 15 deadline.