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Sen. Hoffman’s bill would raise certificate-of-need threshold for LNG storage
Summary
A bill from Sen. John Hoffman would increase the liquefied natural gas (LNG) storage threshold that triggers a certificate-of-need (CN) review, a change CenterPoint Energy says would make small-scale storage projects more feasible without altering safety or permitting requirements.
Sen. John Hoffman introduced Senate File 1455 on March 12, 2025, asking the Energy, Utilities, Environment, and Climate Committee to raise the storage-size threshold that triggers a certificate-of-need review for liquefied natural gas (LNG).
The bill would change the statutory threshold that now dates to 1974 and requires a CN when LNG storage reaches 100,000 gallons. Supporters told the committee the existing threshold and the time and expense of the CN process discourage utilities from considering smaller, distributed LNG storage options that they say can reduce customer costs and increase system resilience on very cold days.
Jamie Fitsky, director of government affairs for CenterPoint Energy, told the committee the proposal is a procedural change rather than a relaxation of permitting or safety requirements. Fitsky said the bill would allow storage systems “up to a million gallons” to be evaluated without the CN trigger while leaving state, local and federal permitting, and safety codes unchanged. Fitsky said the Public Utilities Commission had been consulted and “has no concerns.”
John Heer, director of storage and supply planning at CenterPoint Energy, described LNG tanks and use cases for Minnesota, saying the existing 100,000-gallon threshold does not reflect current industry practice. Heer, a professional engineer with decades of energy experience, told the committee that utilities use LNG as a form of hedging: purchasing gas when prices are low, storing it chilled as a liquid, then deploying it on high-cost days or to support pressure in rural pipeline extensions.
Heer and Fitsky said typical projects contemplated under the new threshold would be smaller than large electric generation CN projects. Fitsky estimated a full, up-to-one-million-gallon installation could cost roughly $15 million while CenterPoint expects to pursue modular systems of multiple tanks (Fitsky estimated three to five roughly 70,000-gallon tanks) with costs in the $5–$10 million range. Both witnesses emphasized the change would not alter safety or siting code obligations; it would only change the point at which a CN process applies.
Committee Chair Frentz thanked the testifiers. No members of the public requested to testify. The committee laid the bill over for possible inclusion in the omnibus bill; no final vote on the bill was taken in the committee.
The bill as presented affects state CN procedure and, if advanced, would be subject to any PUC review and to existing local, state and federal permits that apply to LNG facilities.
