UGI Utilities has received regulatory approval from the Pennsylvania Public Utility Commission (“PA PUC”) to purchase renewable natural gas as part of a five-year pilot program. The pilot, the first of its kind in Pennsylvania, is intended to explore how UGI Utilities can integrate renewable natural gas (RNG) into its supply portfolio to produce economic and environmental benefits for its Purchased Gas Cost (PGC) customers. The pilot allows UGI Utilities to test adding RNG to its supply portfolio while leveraging certain available economic incentives for renewables to lessen the cost impact of purchasing RNG for customers. UGI Utilities, a subsidiary of UGI Corporation (UGI), is the second largest regulated gas utility in Pennsylvania.
The PA PUC Commissioners voted unanimously to approve the pilot program, with all three commissioners issuing statements in support of the program. In a joint statement, Commissioners Ralph V. Yanora and John F. Coleman, Jr. commended UGI Utilities for the pilot program, stating that it “represents an innovative economic model that balances environmental, customer, and gas supply requirements consistent with the Commonwealth’s least-cost gas supply requirements.”
“The approval of this pilot program is a significant step forward as we continue to develop sustainable, environmentally responsible energy solutions for our customers,” said Robert F. Beard, Executive Vice President - Natural Gas, Global Engineering & Construction and Procurement. “UGI remains committed to developing renewable energy sources for the communities we serve.”
Earlier this year, UGI Utilities signed an interconnect agreement with Archaea Energy to accept delivery of RNG into its high-pressure natural gas pipeline that serves its distribution system. When fully operational, the system will be designed to take up to 16,000 mcf (thousand cubic feet) per day of RNG supply, making this the largest RNG supply point in the United States to-date.
RNG is a low or negative carbon energy solution that is derived from organic waste including farm, municipal, landfill and industrial waste. It is a sustainable and reliable energy source that is highly compatible with existing infrastructure when blended with natural gas. RNG can also be used directly in a manner consistent with natural gas for residential, commercial, industrial and transportation.