November 14, 2016 Read More →

On the Blogs: Pipeline Glut in Southeast U.S.

Gillian Neimark for Southeast Energy News:

While the shale boom has seen a proliferation of new natural gas pipelines throughout the Southeast, critics say many of the projects are not needed and are simply a way for developers and utilities to reap profits on the backs of ratepayers.

The Marcellus shale—which lies beneath much of Ohio, West Virginia, Pennsylvania and New York—is now “sprouting pipelines like an octopus,” according to Greg Buppert, senior attorney at the Southern Environmental Law Center (SELC). “Several of those pipelines put ratepayers throughout the Southeast region at risk.”

The notion that companies would deliberately overbuild infrastructure for profit is not necessarily a controversial one.

“The pipeline business will overbuild until the end of time,” announced Kelcy Warren, CEO of Energy Transfer Partners (ETP), a Dallas, Texas, natural gas and propane company, at an August 2015 earnings call.

At least four large proposed pipelines will traverse the southeast, and are the focus of overbuilding concerns on the part of the Sierra Club, the Southern Environmental Law Center, Atlanta-based GreenLaw, and other organizations—all of whom cite evidence that the proposed pipelines may not actually be needed to meet projected demand.

Two of the planned pipelines—the 550-mile Atlantic Coast Pipeline and the 300-mile Mountain Valley Pipeline—will cost $9 billion to complete and will run into Virginia and North Carolina from the Marcellus and Utica shale region of West Virginia. The third, the 516-mile Sabal Trail Transmission Pipeline, is part of the larger Southeast Market Pipeline project, which traverses 685.5 miles to the southeastern United States and Florida.

Sabal Trail will cost $3 billion to complete and will pick up Marcellus-sourced gas piped “backwards” down the existing 10,200 mile Transco pipeline to Alabama, before it continues on through south Georgia and into Florida.

The fourth, Atlantic Sunrise, is a $3 billion project to expand Transco’s mainline by two hundred miles, connect to Sabal, and supply Florida.

In August, The Gulf Restoration Network, the Sierra Club and Flint Riverkeeper filed a lawsuit against Sabal Trail, alleging that the pipeline will move gas over environmentally sensitive wetlands in three states, as well as traverse an area that provides drinking water to approximately 10 million people. In October, SELC filed a motion to reject the current proposed route of the Atlantic Coast Pipeline, noting that it runs through protected private lands and easements that border national forest (a previous route through the public forest itself was rejected by the U.S. Forest Service in January of 2016).

ENVIRONMENTAL CONCERNS ASIDE, THE THREE PIPELINES MAY NOT BE NECESSARY, according to new research as well as data-mining of publicly available utility company filings.

“The Federal Energy Regulatory Commission (FERC) oversees interstate gas pipelines, and they invented the rubber stamp,” says Buppert. “It’s fair to say they don’t turn down pipeline requests, and it’s also fair to say they do not look under the hood on the question of public necessity.”

But SELC, in conjunction with Appalachian Mountain Advocates and Synapse Energy Economics, a Cambridge, Massachusetts environmental consulting firm, did look under that hood, producing a detailed study of the proposed Atlantic Coast and Mountain Valley Pipelines in September of 2016. That study suggests that existing pipelines can supply more than enough fuel to power the region through 2030.

“Despite what we have heard from the utilities, we will have plenty of power and heat without these pipelines,” says Buppert.

Pipeline developers generally rely on the expectation that there will be significant growth in population and regional natural gas use for electric power generation over the next 20 years, but the Energy Information Administration (EIA) has revised its forecasts of electricity consumption in the region steadily downward over the last 15 years.

In addition, according to an April 2016 report by the Institute for Energy Economics and Financial Analysis (IEEFA), existing pipelines in West Virginia, Virginia and North Carolina are very underutilized: “Average capacity utilization in 2014 for pipelines flowing out of West Virginia was 33%. Utilization of pipelines flowing into Virginia was 23% and into North Carolina, 37%.”

Full article: Advocates: Ratepayers will be on the hook for unnecessary pipelines

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