On Monday, Vicinity Energy filed an anti-competitive pricing complaint with the Pennsylvania Public Utility Commission against Philadelphia Gas Works over PGW’s proposed gas price hikes.
PGW presented Vicinity with an offer in February that would increase the price of gas supplied to Vicinity’s Grays Ferry plant by over 1,000% beginning in 2023, when PGW and Vicinity’s current contract expires.
Vicinity’s complaint argues that the pricing is “anti-competitive and designed to make district energy steam, an alternative to natural gas service provided by Philadelphia Gas Works, significantly more expensive for customers.”
Per the current contract, PGW supplies gas transportation services to Vicinity’s Grays Ferry plant while Vicinity purchases gas from third-party natural gas suppliers. The gas is then consumed to help generate both electricity and a by-product thermal heat in the form of steam that is used to heat and cool buildings, serving as a clean, low-carbon alternative to directly consuming gas.
In a press release, Vicinity said the increase in the cost to transport gas through PGW’s pipeline is “unreasonable and an attempt to impose significant anti-competitive pressure on Vicinity’s mission-critical energy services business.”
Vicinity also alleges that the new offer migrates the company from firm gas delivery to interruptible supply, which provides PGW the ability to suspend the supply of gas to Vicinity at any time. It’s a shift Vicinity calls “unacceptable.”
Vicinity has estimated that its combined heat and power operations avoid over 300,000 tons of CO2 emissions annually compared to on-site gas boilers and electric consumption from the electric grid.
The company also said that it remains committed to further investing in the city’s green energy infrastructure and reaching zero net carbon emissions by 2050.