Philadelphia Gas Works Seeks Approval For P3 Project to Unlock LNG Revenue Stream
Proposed Partnership Could Generate More Than Four Million Dollars a
Year of Additional Revenue, Equivalent to Adding Approximately 6,000 New
Residential Customers.
Today, Philadelphia
Gas Works (PGW) submitted details of its proposed Public Private
Partnership (P3) project with Passyunk Energy Center, LLC (PEC) to the Philadelphia
Gas Commission (PGC) for review. The project, if approved, will
facilitate the marketing and sale of Liquefied Natural Gas (LNG) to
regional customers by PEC, with the potential to generate millions of
dollars in PGW revenue each year, through fees and revenue-sharing.
As proposed, PEC will build new liquefaction and truck loading
facilities and will market and sell LNG, while PGW will operate the LNG
facilities and sell related services to PEC. The new facilities will
occupy a limited footprint entirely within PGW’s existing Passyunk Plant.
PASSYUNK P3 PROJECT OVERVIEW
Project Costs
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PEC is responsible for all costs in developing the new facilities at
PGW’s Passyunk Plant.
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As submitted, the P3 is structured with no cost impact on PGW
ratepayers.
Revenue & Value
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This project offers the potential for more than $4 million in
additional revenue for PGW, each year for 25 years.
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The project also represents an improved utilization of PGW’s existing
LNG infrastructure, which will further increase the value of this
city-owned asset.
Environmental Considerations
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No new pipeline is required for this P3 project.
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Air emissions from this project will be minimal and fall significantly
below minimum permitting limits.
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The project will require no new water supplies and no new sewer
connections.
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Even after PEC begins sales, the number of trucks entering and exiting
the Passyunk Plant each day will not increase significantly.
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LNG represents a cleaner fuel option for regional, large-scale
customers that currently rely on fuel oil, coal, or international fuel
imports, to conduct business.
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This P3 project supports Philadelphia’s commitment to a clean,
affordable, and healthy energy future.
PUBLIC-PRIVATE PARTNERSHIP OVERVIEW
PGW’s proposed P3 partner is Passyunk Energy Center LLC a special
purpose entity established by Liberty
Energy Trust GP, LLC (LET) to develop the LNG facilities and then
market and sell LNG to regional customers. LET is a Conshohocken-based
energy infrastructure development and investment company.
PEC will build – and PGW will then lease, at a nominal fee – new
liquefaction and loading facilities. PGW will then operate the new
facilities and sell LNG production services to PEC for a fee.
QUOTES
“This project takes PGW’s decades of LNG experience and expertise and
puts it to new use on behalf of our customers, and the City,” said Craig
E. White, president and CEO of Philadelphia Gas Works. “While working
with LNG isn’t new, we are looking forward to opening up an important
additional revenue stream – which we can reinvest right back into the
business, on behalf of our ratepayers. LNG has saved Philadelphia
customers over $3 billion dollars since we began processing LNG in
Philadelphia. Now, with this P3 project, PGW is moving beyond saving
money to generating millions in additional revenue on behalf of its
customers.”
“Improved utilization of the PGW’s LNG infrastructure unlocks a cleaner
fuel source for utilities, transportation sector and power generations
that are eager to switch from oil and oil-based products” said Charlie
Ryan, founding partner of LET. “We are excited to be a part of this P3
effort that upgrades not only the Philadelphia energy platform through
the most effective energy storage and peak supply solution, but also
leverages Philadelphia’s location as a regional logistics hub and the
energy innovation center.”
ABOUT PGW’S PASSYUNK PLANT
PGW’s Passyunk Plant, located in South Philadelphia, has had an LNG
facility on site since 1979, and currently operates as a natural gas
distribution, liquefied natural gas storage and vaporization facility.
It also houses PGW training facilities, its Chemical Services Department
and its laboratory. The Passyunk Plant operates 24 hours a day, 7 days a
week to support Philadelphia’s energy needs.
ABOUT PGW
Founded in 1836, The Philadelphia Gas Works (PGW) is owned by the City
of Philadelphia and is the largest municipally-owned gas utility in the
country. PGW manages a distribution system of approx. 6,000 miles of gas
mains and services for its almost 500,000 customers. PGW operations are
managed by the non-profit Philadelphia Facilities Management Corporation
(PFMC).
More information about the company is available at pgworks.com.
ABOUT LIBERTY ENERGY TRUST
Liberty Energy Trust GP, LLC is a Pennsylvania-based energy
infrastructure investment firm focused on expanding the use of clean
energy throughout the utility, transportation, and electric generation
markets in the United States. Liberty operates in New England and the
mid-Atlantic energy markets.
More information about the company is available at libertyenergytrust.com
SOCIAL MEDIA TAGS PGW Twitter: @MyPGW
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PGW YouTube: PhillyGasWorks
Nextdoor: nextdoor.com/MyPGW
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