Natural gas lines may be coming to Belwood in the next few years.
On June 19, Centre Wellington councillors formally lent their support to a proposal from Union Gas to extend service to Belwood.
The decision followed a presentation by Matt Jackson of Union Gas, who said, “This is something we are quite excited about at Union Gas … and I think there is a bit of excitement in the community as well.”
He thanked the CAO Andy Goldie and Mayor Kelly Linton for their support, adding, “There’s been quite a bit of back and forth to get to this point.” Jackson said.
He explained Union Gas is Ontario’s second largest gas utility, with 1.4 million customers throughout the province.
“It’s a fairly large network of pipelines – over 65,000 kilometres,” said Jackson, adding Union Gas has about 2,400 employees across the province, Jackson said.
He explained the project will get natural gas to more rural areas across Ontario.
“We’ve been at this for five or six years now, and we are excited about where we are today,” said Jackson.
He said it is no surprise to most people that the price of electricity has been creeping up.
“By expanding natural gas to more communities, we believe we can spur economic growth and improve financial realities for families and businesses in those communities,” Jackson stated.
“Natural gas continues to be the low cost energy source in Ontario.”
He also contended that compared to propane or oil, natural gas has the lowest greenhouse gas emissions.
Jackson said the cost of natural gas for the typical home in Ontario is less than $1,000 each year.
Electricity is upwards of $3,500, while the cost for propane or furnace oil is about $2,000 annually, he said.
Ontario’s Natural Gas Grant Program
Jackson said Ontario recently announced funding to help expand access to natural gas across the province.
The intent is to expand access to municipalities, First Nations and unincorporated areas.
Applications are to be submitted by natural gas distributors.
“All we need from you is a resolution of support,” Jackson told council.
He said costs to convert equipment and connect individual properties are not eligible for coverage.
He said current regulations make it clear that existing customers cannot pay the cost of extending the service. As a result, those signing on would have a surcharge to the cost of natural gas.
The surcharge is the equivalent of 23 cents per cubic metre on new customer bills.
“For the average homeowner, it works out to a $500-per-year contribution for the capital costs,” he said.
The surcharge would be in effect for 40 years, but even so, customers would still see overall savings compared to other energy sources, Jackson said.
He suggested overall savings would still be $1,000 to $2,000 per year.
Financial implications
The province requires lower tier municipalities to financially contribute to the applications being made as part of the program.
Goldie said the province is allowing the municipal contribution to be made through a granting back of the incremental increase on the taxes on the Union Gas Belwood gas expansion system for a minimum period of 10 years.
Jackson said Union Gas would pay the yearly taxes and the township would grant back approximately $11,000 per year or $110,000 over ten years.
“Staff support this deferral of incremental tax increase in order to provide natural gas to Belwood,” Goldie said.
“Staff believe this is a significant economic development opportunity of providing new economical utilities to exiting residents and business owners in Belwood.
“We are hopeful the project will come through with funding.”
He said if things go well, construction could begin in 2019 at the earliest.
Gas pipelines would head from Fergus along Wellington Road 19 past Pine Meadows to service both north and south Belwood if approved.
Jackson said if the application is approved, he expects notification this fall.
“Potentially this is really good News for folks in Belwood,” Linton stated.
Councillor Mary Lloyd said, “I’m very happy this is going forward – that we can offer this to our residents and the small businesses which are out there.”
Council unanimously supported making a financial contribution in an amount equivalent to the property tax that would be recovered on the new natural gas infrastructure in Belwood for a period of 20 years, as per the natural gas grant program requirements.
