Federal Energy Regulatory Commission Approves the Atlantic Coast and Mountain Valley Pipelines

By John McFerrin

In two decisions issued together (two pipelines, two decisions) The Federal Energy Regulatory Commission (FERC) has approved both the Atlantic Coast and Mountain Valley Pipelines.  The pipelines still need other approvals by state officials but, so far as FERC is concerned, the pipelines are approved.

While not articulating it this way, the decisions are based upon two principles.  The first is that nobody wants a pipeline close to them but we’ve got to put them somewhere and this is as good a place as any.

The second is that the developers have looked at the environmental harms of the pipelines.  There will be some environmental damage but (if the developers do what they said they will do and comply with the conditions FERC has set) the damage will be tolerable.

Throughout the review of the proposed projects many people had challenged the premise that we had to put them somewhere.  Many groups had submitted studies indicating that the pipelines were not needed.  They pointed to such things as the rise of renewable energy and projections of demand for electricity that were lower than the developers had projected.

People had also pointed to the pipelines that already exist. There is already a pipeline—called Transco—that goes through the region and can meet much of the need.  There are also improvements currently underway on the WB Xpress project, an expansion of the existing Columbia Gas Pipeline serving West Virginia and Virginia and connecting to Transco. Requiring just 3 miles of new pipeline, an additional compressor station and other modifications, this limited construction will add capacity nearly equal to the ACP.  There are also plans in the works to reverse the direction of Transco’s flow of gas, making it able to supply more gas to the region that would be served by the proposed Atlantic Coast Pipeline.

FERC rejected this approach in determining need.  Instead, it relies upon there being customers who say they wish to buy the gas that the pipelines will transmit.  If there are customers, then FERC assumes that the pipeline (or two pipelines) is needed.  The developers of the Atlantic Coast Pipeline and the Mountain Valley Pipeline have submitted agreements with potential customers.  The customers are subsidiaries or affiliates of the developers.  FERC considered these agreements as the best evidence of need.

The FERC decision is also notable for what it does not contain.  In comments upon the proposed pipelines, many had suggested that FERC take a more cumulative approach, looking at both existing pipelines and the need and impact for both new pipelines.  FERC would have none of that.  In the decision it declined to do what it called “regional planning.”  Instead, it takes what applications for new pipelines that come before it and decides on each application.  If the developers say they have customers, then the pipeline must be needed and that’s that.

Having satisfied what it sees as its primary duty and determined that the pipelines are needed, FERC moved on to determine that the collateral damage of the pipelines was tolerable.  It described the environmental damage this way:

As discussed in more detail below, Commission staff considered specified impacts to be short-term to permanent, and forest fragmentation impacts to be significant.  Commission staff concludes that constructing the pipelines in steep terrain or high landslide incidence areas could increase landslide potential, and, where waterbodies are adjacent to steep terrain, slope instability could have long-term and adverse impacts on water quality and stream channel geometry, and, therefore, downstream aquatic biota. Additionally, constructing the ACP Project facilities could significantly impact cave invertebrates and other subterranean species that occur in only a few known locations, and result in population-level effects on these species. For most other resources, impacts would be reduced to less than significant levels with the implementation of mitigation measures proposed by the applicants and other mitigation measures recommended by Commission staff and included as environmental conditions in the appendix to this order.

FERC addresses these concerns in two ways.  First, it considers the information and reaches the conclusion that the project is “environmentally acceptable.”  Second, it conditions this finding upon an assumption that the developers will build the pipelines according to a long lists of conditions that are appended to the decisions.

Doing things this way presents a difficulty.  Many have long wondered just how developers intended to cross streams, lay pipe up and over steep terrain, operate in karst geology, etc.  The approval doesn’t say; neither have the developers.  Instead, the approval decisions require that the developers file what is called an Implementation Plan which will explain how the developers plan to address these problems.  The Implementation Plan will have to be filed with FERC before construction begins.

Doing it this way sidesteps the public.  The Implementation Plans, which address many of the questions that concern the public the most, will be submitted to FERC and reviewed without any opportunity for the public to review or comment upon them.

The dissent

Unlike most FERC decisions, this one was not unanimous.  Commissioner Cheryl A. LaFleur voted against the approvals and filed a dissenting opinion.  Much of her dissent was based upon what is for her, and many people, an unanswered question:  These pipelines start in the same place and end up in pretty much the same place; do we really need two?

In the dissent she elaborated on her concern:

Deciding whether a project is in the public interest requires a careful balancing of the need for the project and its environmental impacts.  In the case of the ACP and MVP projects, my balancing determination was heavily influenced by similarities in their respective routes, impact, and timing.  ACP and MVP are proposed to be built in the same region with certain segments located in close geographic proximity.  Collectively, they represent approximately 900 miles of new gas pipeline infrastructure through West Virginia, Virginia and North Carolina, and will deliver 3.44 Bcf/d of natural gas to the Southeast.  The record demonstrates that these two large projects will have similar, and significant, environmental impacts on the region.  Both the ACP and MVP cross hundreds of miles of karst terrain, thousands of waterbodies, and many agricultural, residential, and commercial areas.  Furthermore, the projects traverse many important cultural, historic, and natural resources, including the Appalachian National Scenic Trail and the Blue Ridge Parkway.  Both projects appear to be receiving gas from the same location, and both deliver gas that can reach some common destination markets.  Moreover, these projects are being developed under similar development schedules, as further evidenced by the Commission acting on them concurrently today.

The dissent identifies two alternatives that the FERC staff actually evaluated which would have eliminated this duplication.  One would have been what was called the MVP Merged Systems Alternative.  It “would be 173 miles shorter than the cumulative mileage of both projects individually.  This alternative would also increase collocation with existing utility rights-of-way, avoid the Monongahela National Forest and the George Washington National Forest, reduce the number of crossings of the Appalachian National Scenic Trail and Blue Ridge Parkway, and reduce the amount of construction in karst topography.”

The FERC staff rejected this alternative because, essentially, the two separate pipelines were already planned.  Starting over with a merged route would have resulted in delays.

The FERC staff also considered a single pipeline alternative that would have used a single pipeline along the ACP route to deliver both the MVP gas and the ACP gas.  This alternative would have eliminated all impacts along the proposed MVP route.

The dissent also questions FERC policy on evaluating the need for the pipelines.  Although its written policy would allow it to consider more things, FERC has traditionally decided upon the need for the pipeline by looking at what it calls “precedent agreements.”  These are essentially contracts in which customers agree to buy the gas that is delivered.

In this case, the pipelines have precedent agreements which show that there are customers for the gas. The precedent agreements by ACP largely involve selling gas to subsidiaries and related companies so that they are selling gas to themselves.  The dissent suggests that the Commission should look beyond these agreements and consider more information before deciding whether there is a need for new pipelines.

The future

Although FERC is finished, at least for now, with the Atlantic Coast Pipeline and the Mountain Valley Pipeline, that does not mean that they will be built.  This decision will almost certainly be appealed.

There are also other battles.  Environmental regulatory agencies in the three states that one or both pipelines will pass through must still certify that the pipeline will not degrade the waters of that state or cause a violation of state water quality standards.  There are proceedings going on in West Virginia, Virginia, and North Carolina.  There was a long story about this in the October, 2017, issue of The Highlands Voice if you still have that lying around or want to look at it on line at wvhighlands.org.

There is also the permission from the United States Forest Service to cross the Monongahela and the George Washington National Forests.  The Forest Service has issued a preliminary approval.  When that approval becomes final, there will almost certainly be an appeal.

Finally, there are rights of way disputes.  A lot of landowners along both routes are fired up and will not surrender rights of way willingly or easily.  Both pipelines face a series of battles.  The FERC decision gives the developers the right to use eminent domain to acquire rights of way.  This is a powerful tool which makes the battles easier for the developer but does not eliminate them.

In short, developers of both pipelines are doing their happy dances at the FERC approval and they have a right to feel encouraged.  At the same time, it’s not over till it’s over and it’s not over yet.