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[Testimony] Rob Wonderling on Energy Development as Regional Economic Driver

Posted Friday, August 19th, 2016

Member News, Economy, Action Teams, Energy

On Tuesday, August 16, Rob Wonderling, President & CEO of The Chamber of Commerce, presented testimony before the Federal Energy Regulatory Commission (FERC) in support of developing the PennEast Pipeline as a key economic driver for the region. The FERC is collecting public comments at six sessions in Pennsylvania and New Jersey on its draft environmental-impact statement concerning the pipeline development.

Read the full testimony below:

Comments of Rob Wonderling
President & CEO, The Chamber of Commerce for Greater Philadelphia
Before the Federal Energy Resource Committee – Draft EIS Public Comment Session

Tuesday, August 16, 2016
Peddler’s Village
Routes 202 & 263
Lahaska, PA

I am Rob Wonderling, President and CEO of The Chamber of Commerce for Greater Philadelphia. The Chamber represents 4,000 member companies who employ more than 175,000 men and women across the Greater Philadelphia region, an 11-county, tri-state region comprised of counties within southeastern Pennsylvania, southern New Jersey and northern Delaware. I am here today to voice my support for the PennEast Pipeline project and share with you key information on how pipeline infrastructure from the Marcellus and Utica shale plays are key economic drivers for the Greater Philadelphia region and the United States.

Two years ago, members of the Chamber, CEO Council for Growth and Select Greater Philadelphia assembled a multi-industry energy consortium of 90+ business, public sector, labor and academic leaders –the Greater Philadelphia Energy Action Team (GPEAT). The group, commonly known as GPEAT, works to establish the Greater Philadelphia region as an energy hub to stimulate manufacturing and economic development by building awareness, influencing policy makers, and facilitating the development of energy assets. Several of the companies active in GPEAT are partners on the Penn East Pipeline, including UGI Energy Services, PSEG Power, South Jersey Industries, and Spectra Energy Partners.

The group is a consortium of leaders working to 1.) Promote pipeline development from the PA shale wells to the Greater Philadelphia region to increase the supply of hydrocarbons used in heating, manufacturing, petrochemical processing and other industries; 2.) Attract more energy-intensive manufacturing companies to the region, and finally 3.) Build a demand center by increasing the consumption of natural gas and natural gas liquids (NGLs) in the region and increase the economic value.

In March of 2016, GPEAT issued a report, “A Pipeline for Growth” outlining GPEAT’s strategy to create a regional energy hub through further development of pipeline capacity into the Greater Philadelphia region from the Marcellus and Utica shale regions. The report addresses the infrastructure, economic and regulatory challenges that exist in bringing natural new natural gas pipeline capacity to the region.

The Greater Philadelphia region currently consumes 3 Bcf/day of natural gas and does so via a strong interstate pipeline system. With the issuance of its report, GPEAT announced a shared goal to double the amount of natural gas flowing into our region—an additional 3Bcf/day of natural gas. The good news is we are headed in the right direction; projects like the Penn East Pipeline are the first of many that will bring large amounts of natural gas into and near the Greater Philadelphia region allowing for communities and businesses to start to see the economic benefit of connectivity to the abundant and affordable Pennsylvania shale gas.

Economic analysis by Econsult Solutions, Inc. and KPMG conducted for “A Pipeline for Growth,” estimates that an additional 3 Bcf/day of gas to establish a regional energy hub will account for:

    • $10 billion investment in manufacturing
    • $550 million/year in energy savings
    • Economic Impact:
      • Direct Output: $321 million
      • Indirect Output: $567 million
    • 10,000 + Jobs Created

Penn East Pipeline, is a key pipeline project that would connect gas markets in eastern and southeastern Pennsylvania and New Jersey with natural gas resources sourced directly from the Pennsylvania shale plays. Infrastructure projects like the Penn East Pipeline are not only key to the Greater Philadelphia region becoming an energy hub, but they are projects that will have a significant positive impact on the Commonwealth of Pennsylvania and the United States.

Design and construction and ongoing operations for the Penn East Pipeline will account for the development of over 12,000 jobs and the pipeline is projected to have an approximately $2 billion economic impact. Most importantly, the Penn East Pipeline will provide a short transportation option for users who are seeking a direct access to Marcellus shale natural gas supplies. With hundred year plus reserves and lower costs, connectivity to this these shale plays provides users the ability to prevent supply constraints during peak season and the potential to lower gas and heating bills. This will provide residents and businesses costs savings benefits.

The winter of 2013/2014 was wrought with severe and prolonged cold temperatures and our region faced a polar vortex resulting in higher demand for electric and natural gas for residential and industrial consumers. In 2015, Concentric Energy Advisor’s Inc. released findings that if the additional 1 Bcf/day of pipeline capacity from the development of the Penn East Pipeline was available it would have provided energy consumers in eastern Pennsylvania and New Jersey a savings of $890 million. This is a tremendous benefit to not only the citizens of the Greater Philadelphia region but provides a strong and competitive advantage to the chemical and petrochemical companies already here – and to those considering locating new facilities here. Reduced natural gas prices and pricing stability plays a substantial role in economic development and our region’s and nation’s ability to continue to develop and attract a downstream market of energy-intensive manufacturing.

Colleagues of mine focused on regional business attraction efforts cite that often the first question asked by prospective energy intensive manufacturing businesses considering our region for an expansion project is whether there is available, uninterruptable and affordable natural gas access located near our industrial land, port and rail infrastructure. Price stability for natural gas in the region is also a strong consideration for potential industrial locates. Pipeline projects, like Penn East, should be encouraged to continue to facilitate greater development of energy intensive manufacturing.

The world markets are focused on the opportunities that can be derived from the abundant shale resources within the Pennsylvania, Ohio and West Virginia shale plays. We as a nation have the opportunity to take homegrown resources and responsibly use them to for the benefit of our citizens and economy. The Greater Philadelphia Energy Action team supports the development of the Penn East Pipeline and believes it is the first of many steps we can take to reach and maintain energy independence and regain our region’s and nation’s position as an energy leader.

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