August 13, 2020 Read More →

IEEFA update: Another pipeline tripped up by failure to obtain a Clean Water Act approval

State action thwarts another U.S. federal effort to expand fossil fuel-burning as financial realities and alternative solutions embolden a North Carolina agency

While the debate rages over the Mountain Valley Pipeline, a large proposed extension has just hit a brick wall.  

The main Mountain Valley Pipeline, which would run 303 miles from West Virginia to Pittsylvania County in Virginia, is not yet fully built. Construction was speeding along until a U.S. appeals court ruled that it had not completed a proper environmental review. The Federal Energy Regulatory Commission (FERC) therefore issued a stop-work order in October 2019. 

The U.S. Forest Service and Bureau of Land Management recently issued a public notice of intent to produce a Supplemental Environmental Impact Statement for the project. The environmental review would consider changes to the project and its potential impact on endangered species. The Mountain Valley Pipeline would need to regain approval from the two agencies to traverse the Jefferson National Forest, including passing under the Appalachian National Scenic Trail in southwestern Virginia. 

Efforts are being thwarted to build a related $468 million, 73.7-mile MVP Southgate Project

Meanwhile, developers have been thwarted in their efforts to obtain approval to build a related $468 million, 73.7-mile Mountain Valley Pipeline Southgate Project. The proposed pipeline would extend from the terminus of the main Mountain Valley Pipeline near Chatham, Va., to  Dominion Energy’s gas distribution network near Graham in North Carolina’s Triangle region (Chapel Hill, Raleigh & Durham).

North Carolina’s Department of Environmental Quality has denied certification for the pipeline under Section 401 of the Clean Water Act. This is the same legal approval that the State of New York’s Department of Environmental Conservation denied in May to the owner of the Williams NESE Pipeline, which has since been scrapped in favor of alternatives.

But how the North Carolina agency did this is interesting. It noted that the project applicant had declared that if the permission were granted, it would start construction immediately. The agency observed that the Mountain Valley Pipeline Southgate Project is completely dependent on construction of the main Mountain Valley Pipeline.  It then took a close look at the status of the main pipeline project, including the stop-work order and unresolved permitting issues, and concluded that the Mountain Valley Pipeline’s ultimate construction was far too tenuous to be considered a reliable rationale for launching construction of a pipeline extension project.  

The North Carolina agency could not justify environmental destruction from the pipeline’s construction

The North Carolina agency determined it could not justify the environmental destruction from the Southgate pipeline’s construction when the fundamental purpose of the project might not be accomplished. Its denial, issued on Aug. 11, is therefore both a decision on the Southgate Project and a comment on the viability of the main Mountain Valley Pipeline project. The Southgate pipeline’s developer Mountain Valley Pipeline LLC— a consortium whose members include NextEra Energy, Consolidated Edison Transmission, EQM Midstream Partners, WGL Midstream and RGC Midstream—has 60 days to appeal.  

The agency limited its decision to this issue, and did not reach a decision regarding whether the approval would be granted if the project’s purpose were to be fulfilled. It is notable that the North Carolina agency submitted letters to FERC in 2018 and 2019, challenging the necessity of the Southgate pipeline in light of reasonably and economically viable alternatives and raising concerns about its adverse environmental effects.  

In a separate-but-relevant matter, promoters of the Dakota Access Pipeline have won a federal appeals court ruling vacating the district court order that would have forced the pipeline to shut down. Nevertheless, the appeals court sent the Army Corps of Engineers back to that same district court to report on its plan for addressing the violation caused by the pipeline’s unpermitted passage underneath Lake Oahe, a reservoir on the North Dakota-South Dakota border that serves as a drinking water supply. Also, the appeal of the district court’s ruling that vacated the Army Corps of Engineers’ approval allowing the pipeline to pass under Lake Oahe remains pending in the appeals court. Thus, while the pipeline continues to operate, legal challenges remain. 

On a larger scale, these battles raise public awareness of the financial and environmental costs of oil and gas infrastructure expansion and highlight alternatives that have become increasingly attractive. As a result:

  • Better informed rate-paying consumers may be more reluctant to shoulder the financial costs of pipelines;
  • Utility executives may find themselves increasingly in the spotlight, as they have a key role to play in carrying out state policies on climate and energy, and many are choosing to reject using fossil gas as a “bridge fuel” and instead moving straight to renewable energy; and
  • The notion that the environmental risks of oil and gas infrastructure can just be passed along to the public is meeting with strong opposition.

With the improved competitiveness of renewable energy and energy-efficient technologies and the rapidly evolving laws and local programs responding to concerns about climate impacts, oil and gas infrastructure projects face increasing risks.  

 

Suzanne Mattei ([email protected]) is an IEEFA policy analyst.

 

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