Oct 14 (Reuters) - National Grid Plc said on Monday it was taking steps to reconnect about 1,000 natural gas customers in New York City and Long Island following a state order after the utility previously refused to reinstate service, citing short supply.
On Friday, New York Governor Andrew Cuomo said National Grid is facing millions of dollars in penalties for failing to connect existing gas customers as required by law. National Grid said in May it would not process new applications for gas service in downstate New York until Williams Cos Inc's $1 billion Northeast Supply Enhancement pipeline from Pennsylvania to New York receives the permits it needs to get built. The customers National Grid will now connect were existing customers that had their service turned off for things like renovation or construction, according to local media reports.
The governor said the Public Service Commision (PSC) ordered the company to immediately connect gas service to 1,157 residential and business customers.
"Our objective is to contact all customers outlined in the order by the end of this week ... Our goal is to re-connect the majority of these customers within the mid-November timeframe," John Bruckner, president of National Grid New York, said in a statement.
He said the company would expand existing conservation and energy efficiency programs to reduce energy use, which will help create additional capacity to serve these customers.
"But let's remember, while securing contingency supply solutions will help our customers in the short-term, we still need additional, long-term and firm supplies of natural gas," Bruckner said.
Environmental regulators in New York and New Jersey have denied to issue the pipeline permits in part because the pipe could harm the environment.
The PSC said it will review National Grid's reliability planning protocols since this is the start of the cold-weather period, and the pipeline the company has depended on would not have been available this winter even if it had already been approved.
"We know how frustrating this situation has been for customers ... waiting to be approved for gas service," Bruckner said. "Unfortunately, that's not possible given the current constraints on gas supply."
National Grid is not the only gas company worried about a lack of fuel supplies in New York. Consolidated Edison Inc imposed a moratorium on new gas customers in Westchester County in March due to a lack of new pipeline infrastructure. Westchester is located north of New York City.
(Reporting by Scott DiSavino; Editing by Cynthia Osterman)