PennEast seeks to build pipeline in two phases
Planners behind a pipeline slated to run from northeastern Pennsylvania to central New Jersey are now hoping to split the project into two phases.
PennEast Pipeline Company announced Thursday it would file an amendment to the Federal Energy Regulatory Commission, seeking to build phase one, including 68 miles of pipe and the portion running through Carbon and Monroe counties, entirely within Pennsylvania and ready to deliver natural gas by November 2021.
The second phase would include the remaining route in Pennsylvania and New Jersey, with a targeted completion of 2023.
“In the years since the initial announcement of the project, demand for natural gas has continued to grow, yet the benefits of new job creation, economic development, air quality and lower energy bills have been denied to all customers by shortsighted political interests,” said Anthony Cox, chair of the PennEast Pipeline Company Board of Managers.
“Building the project in phases allows PennEast to meet the clear public need in the short term in Pennsylvania, and in the long term in New Jersey by affording sufficient time for permit and legal issues to be resolved.”
Under the phased approach, PennEast will have within Pennsylvania three delivery points: UGI Utilities Inc. (to serve the Blue Mountain Ski Resort) and new interconnections with Columbia Gas and Adelphia Gateway to serve the growing demand in the southeast region.
“PennEast has always been vital to fulfilling our plans of a new hotel and water park, which have been delayed for years without the natural gas necessary to fuel the expansion,” said Barb Green, president of Blue Mountain Resort.
“The announcement today to complete the project in phases is a major boost for our local tourism, economic development and job creation.”
According to PennEast, no new private property owners will be impacted by the first phase of the project, which would terminate in Bethlehem Township, Northampton County. The new interconnections, which would be located south of Route 22 and west of Route 33, would be constructed on property already owned by PennEast.
“Today’s action again proves the PennEast partners are fully committed to the entire project and meeting the needs of its customers for safe, clean, reliable and affordable energy,” Cox said.
Linda Christman, spokeswoman for Save Carbon County, said, "Pa doesn’t need this pipeline—Pennsylvania has a glut of natural gas. This so called “phased” construction is an attempt to improve their chances before the courts. If New Jersey doesn’t approve the pipeline, Pennsylvania will be left with unnecessary surface damage and a pipeline in the ground that is not needed. I reference the Constitution Pipeline which was never completed and never approved by New York but 28 miles of Pennsylvania was clear-cut and farms were taken for nothing. Once again Pennsylvania gets a bad deal."
She added, " Pennyslvania gas customers will pay for this pipeline. UGI is already asking for a 10% increase —wait until they add the cost of this pipeline to our bills."
Trouble in New Jersey
FERC issued the PennEast Pipeline Company its certificate of public convenience and necessity in 2018, but the project was stymied in New Jersey when a federal appeals court ruled the company couldn’t use eminent domain to acquire 42 properties that are owned by the state and preserved for farmland or open space. The judges wrote that while the federal Natural Gas Act allows private gas companies to exercise the federal government’s power to take property by eminent domain, that doesn’t extend to state-owned properties.
The properties fall under the 11th Amendment, which protects states from lawsuits by private parties in federal court, the panel concluded.
“We won’t hesitate to stand up to private companies when their actions violate the law — in this case the U.S. Constitution,” New Jersey Attorney General Gurbir Grewal said in a statement on the court’s rejection of a rehearing.
PennEast said it would soon be petitioning the Supreme Court of the United States to review the three-judge panel’s decision.
“It overturned nearly 80 years of industry practice and clear congressional intent in the Natural Gas Act,” PennEast said in a press release.
The petition is due March 4.
FERC, on Thursday, backed up PennEast on its quest to get the decision overturned.
“We confirm our strong belief that Natural Gas Act section 7(h) empowers natural gas companies to exercise eminent domain and that this authority applies to lands in which states hold interest,” FERC wrote in its decision. “A contrary finding would be flatly inconsistent with Congressional intent.”
Rich Glick, FERC commissioner, issued a dissenting opinion.
“The only reason FERC issued this order today is because the majority doesn’t like the Third Circuit Court’s decision that pipeline companies can’t sue a state to acquire land via eminent domain,” Glick said in a statement. “FERC should not be pushing out an order just to bolster a private parties’ litigation position.”
Pipeline opposition group Save Carbon County said FERC’s decision came as no surprise.
One question FERC did not answer in its Thursday decision was whether the Natural Gas Act also delegates to certificate holders the federal government’s exemption from claims of state sovereign immunity.
“FERC has a long and consistent history of accommodating pipeline companies,” said Christman. “We are relieved that they chose not to respond the to the third and, in our view, the most important question and we are hopeful that the Supreme Court will decide to deny the upcoming PennEast petition.”
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