As the chairman of the Greater Philadelphia Energy Action Team (GPEAT), Philip Rinaldi is striving to establish the region as an energy hub.
GPEAT is a coalition of about 80 executives, government officials and leaders from higher education who are pushing for expansion of the energy, petrochemical and manufacturing sectors in the region.
Rinaldi addressed the economic impact and importance of establishing an energy hub in Philadelphia during a Tribune editorial board meeting this week. The energy action team seeks to attract businesses to the area and create a hub by highlighting the region’s six refineries, strong manufacturing history and transportation infrastructure, including the highway system, rail access, seaport and close proximity to Marcellus Shale gas.
“The whole idea behind the energy action team is to create a demand,” said Rinaldi, who is the CEO of Philadelphia Energy Solutions, which he said is the largest oil refinery on the eastern seaboard.
Philadelphia Energy Solutions recently filed for a $300 million initial public offering with the Securities Exchange Commission.
Rinaldi said GPEAT is pushing for the creation of a new pipeline that would bring natural gas from the Marcellus Shale to the Philadelphia region, which would be used by energy, chemical and manufacturing companies.
Rinaldi said he planned to speak to City Council during hearings on how to establish an energy hub in Philadelphia. He said he has a good relationship with Council President Darrell Clarke.
“If you have industrial businesses that consume a lot of natural gas, you need to have that steady supply at a low cost,” Rinaldi said.
He noted businesses could use the gas for heat content, metals processing, production of electricity or to convert molecules from the gas into chemicals.
“This energy hub is one whose idea says that if you create a pipeline or a series of pipelines, you effectively take the pricing point away from the Marcellus and move it here,” he said.
Rinaldi said the construction of a pipeline that would bring natural gas from the Marcellus Shale to the Philadelphia region, would cost more than $1 billion. He believes the construction costs would be supported by the industry.
He said the establishment of an energy hub would have a significant economic impact on the region by attracting new energy, manufacturing and petrochemical businesses and more middle-class jobs to the area. Rinaldi said construction of new facilities, which would cost between $500 million to $1 billion to build, would mean more jobs for the construction industry.
While there are some people who support the concept of establishing a pipeline, Rinaldi acknowledged the project is facing opposition.
“We have to put a lot of ducks together because, make no mistake about it, as soon as you announce the intention of the project, opposition will be enormous and opposition is starting to form right now,” he said. “People in that Marcellus region, they probably get it, that it’s a good thing to have increased level of activity — more wells, more production, more jobs [and] more dollars flowing out of the ground.
“People in Philadelphia, I hope kind of get it because it’s more resources flowing through here, new enterprises [and] new jobs. The economic impact is enormous. But what about in between, where the pipelines have to run? There hasn’t been a good job done yet in figuring out [how] to convince people not to be blocking these pipelines.”
To that end, Rinaldi said the action team is trying to convince that population and eliminate some of the opposition.
Last December, the Greater Philadelphia Energy Action Team and the Greater Philadelphia Chamber of Commerce hosted a summit that brought together more than 200 energy and manufacturing executives interested in attracting energy-intensive businesses to the region.