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Northwest Natural outlines options, high costs for extending gas service to Estacada
Summary
Northwest Natural representatives briefed the Estacada City Council on routes, estimated costs and financing options to extend natural gas service roughly 10 miles to the city edge. Company representatives said a 2018 cost estimate of about $20 million likely would now be 1.5–2 times higher and recommended a feasibility study before design.
Northwest Natural officials told the Estacada City Council on Oct. 9 that extending a transmission pipeline roughly 10 miles to serve the city would be technically feasible but expensive and politically complex.
"We are a regulated utility, and we can't bring on new customers that don't pay their way onto the system," said Nina Carlson, government affairs and economic development representative for Northwest Natural. Carlson and Andrea Canal, the company's engineering manager, spoke with councilors about potential pipeline routes, financing options and next steps.
Why it matters: Councilors and staff said bringing natural gas to the city could make Estacada more competitive for industrial users in the city’s industrial park and give residents another heating option amid rising electric rates. Northwest Natural said the typical backbone pipeline route is about 10–12 miles and would require a high-pressure transmission line plus local distribution networks.
What the company said: Canal, the engineering manager, described existing nearby infrastructure (a high-pressure pipe along Oregon Highway 212 serving Sandy and a more recent pipeline down Ritchie and Kelso roads) and said several route options remain under consideration. "All of those routes are about 10 miles just to get kind of to the city center or edge of the city," she said.
Carlson gave council a historical marker: Northwest Natural’s 2018 conceptual estimate for one route was about $20 million; she told councilors that, "costs may be 1.5 times to 2 times more than that" now because of labor, materials and permitting pressures. The company advised funding would likely need to be “stacked” from state and federal grants, bonds and loans and that a third-party feasibility study (estimated $100,000–$200,000) would be required to develop formal costs and permitting needs.
Company limits and process: Carlson said Northwest Natural cannot cross-subsidize current customers to pay for the extension: "We can't bring on new customers that don't pay their way onto the system." The company said it would require contracts or committed customers for the extension to be viable. The presenters recommended focusing initially on industrial customers (process loads such as lumber drying or other heavy users) to make the economics work, then adding residential distribution once a backbone is in place.
Political and permitting considerations: Carlson warned the council to anticipate political opposition in some quarters to building a new large pipeline and said routing through undeveloped areas would carry substantive permitting hurdles. She urged the city to craft a narrative describing the public benefits to support grant and bond applications and recommended working with Business Oregon, the county, and the League of Oregon Cities on funding strategy and advocacy.
Council direction: City Manager Melanie said staff will include the topic in the city’s upcoming goal-setting process; staff and councilors discussed asking the economic-development commission and the city’s major-accounts team to pursue feasibility work and potential customer outreach.
Next steps: Northwest Natural recommended funding and performing a feasibility study and coordinating with an economic-development lead to identify likely anchor customers. Any formal project would require design, permitting and funding commitments before construction.
