Bacon's Rebellion

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Virginia’s Very Own Keystone XL

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Peter Galuszka
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acl pipeline map By Peter Galuszka

The rise of natural gas keeps raising more questions about the proper future of Virginia’s and the nation’s energy policies. What just a little while ago seemed a benign source of energy has gushed into a mass of controversy and advantage.

One focus of the conflict – good and bad – is the $5 billion Atlantic Coast Pipeline that Dominion Transmission and three other southern utilities want to build from the booming natural gas fracklands of northern West Virginia, across sensitive Appalachian terrain and on through Virginia and North Carolina.

The pipeline is unusual since it doesn’t follow the usual post World War II path – Gulf States to the industrial northeast — but it shows just how the U.S. energy picture is being turned on its head.

People in West Virginia have faced the raw end of energy issues for a century and a half, but it is a new matter for the bucolic areas of Nelson County and some of Virginia’s most pristine and appealing mountain country.

Here is a story I wrote for Style Weekly on the promises and problems of Virginia’s very own Keystone XL.

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15 responses to “Virginia’s Very Own Keystone XL”

  1. larryg Avatar
    larryg

    Paradox.

    that’s how I would describe this pipeline issue as well as Keystone.

    The paradox in this one is that most of the coal plants are in the western part of Virginia and you’d think the pipelines would be to gradually replace those plants – as well as ones in WV and Ohio.

    and when looking at Peter’s excellent map – kudos! – why does the gas want to go to Fayetteville and why doesn’t it follow Rt 29 south – a more direct route?

    My guess is that they want to export the gas overseas and that’s why that pipeline takes the route it does.

    Keep in mind that Dominion DOES have the power of eminent domain.. because Virginia gave it to them.. that’s their ultimate power over the property owners whether they let them on their land or not.

    the other paradox is with the Keystone – where there are dozens if not hundreds of existing pipelines and pipelines rights-of-ways available for trans- Canada to negotiate with – other companies instead of getting the power of eminent domain for a Canadian company to take land from American property owners.

    Next – the fact that Canada has existing refineries in Edmonton – that more jobs for Canada. And Canadian citizens pay $5.00 a gallon for gasoline. Why are they not the beneficiaries ?

    so what is really going on in both cases? In a word – private company profit – not public benefit.

    is it okay for private businesses to make a profit? You bet your sweet bippy it is. But what gives them the power of eminent domain instead of negotiating with property owners – in a true business arrangement instead of claiming (I think falsely) that they deserve the power of eminent domain because they are serving the public and citizens?

    And what in the world justifies giving 30 million in tax dollars to Dominion which is chump change compared to the billion dollars the tobacco commission has squandered on crony capitalism boondoggles?

    How many health care clinics would a billion dollars have built in SW and South Va for those whom we deny the MedicAid Expansion to? That’s what that tobacco money should be spent on – not the shameful way it is being spent instead.

    I used to think that Don R was too hard on the VA GA.

    No more – they are so in bed with the rent-seekers – to the detriment of ordinary Virginia citizens – it’s truly sickening.

    Oh, and once again – where the H*E*L*L are those folks who say the govt is out of control and they want to rein it in?

    1. NoVaShenandoah Avatar
      NoVaShenandoah

      There is no paradox: The Keystone pipeline is intended to carry Canadian gas, owned by the Koch brothers, to refineries in Houston, owned/controlled by the Koch brothers, for export. If it was for US consumption the pipeline would end at the refineries in the Mid-West.

      This pipeline seems to serve the same purpose: the product is for export, not to replace the aging plants that VA and WV have.

      There might be an advantage to the pipeline, and the extraction in WV, if we at least gave benefit to the people living in the impacted areas. But whereas the Saudis and Kuwaitis ‘waste’ all that money on their people, we generously give it to those who had nothing to do with the resources exploited.

  2. larryg Avatar
    larryg

    If you look at this map of Virginia natural gas pipelines – which also identifies the owners – you’ll better understand why Dominion is asking for a new one and it has little to do ;with a public need but more about corporate needs:

    http://www.energy.vt.edu/vept/naturalgas/NatGas_pipelines.jpg

  3. Acbar Avatar
    Acbar

    Moving large amounts of energy from one place to another is what we’re talking about. Whether it’s electricity in wires, or gas or oil in pipelines, or oil or coal in trucks or trains or barges or even ships, the transportation of energy can be messy and unsightly and detrimental to the area it’s transported through. That transportation is also a task that is undertaken to serve the public, by regulated public service companies, so the public will be heard, here. And, it can be vital to the local as well as national economy. Bucolic inns in Nelson County notwithstanding.

    On the whole, I can’t imagine why we shouldn’t want this gas pipeline project to succeed. A gas pipeline, buried underground, has about the least long-term visual and other environmental impact of any energy transportation scheme. The biggest impact is the construction phase, and the clearing of the right-of-way of trees, and the continuing surface impact in the immediate environs of the occasional compression station. What Virginia would get from this pipeline is direct access to the new gas fields of the Marcellus shale and a bargaining chip for everyone served by it in dealing with energy sellers over the existing energy pathways including the older pipelines and railroads. Don’t be surprised if that’s where the principal opposition to this project comes from. The downward pressure on energy prices in eastern VA and NC should attract lots of desirable business employment, which must be why the Governor likes it; and of course that will increase Dominion’s sales of both gas and electricity, too.

    We will hear horror stories about the local damage this project could do — although compared to an interstate highway, a gas pipeline is benign. And for the sake of Virginia’s economy we need to support this project overall. But like an interstate highway, where it is routed will have a big influence on future development, good and bad. Where do you want all the VA electric plants built that will be supplied with Marcellus gas? Where do you want all the heavy manufacturing built? That’s where the serious environmental impact will come from. I think that’s the real story, and it isn’t even mentioned in Peter’s article.

    1. larryg Avatar
      larryg

      I don’t disagree with much of what Acbar is saying. There are minimal impacts especially compared to Coal – and Nukes.

      but I’m skeptical this serves the public given the other pipelines and the existing rights-of-ways that could be used.

      the only justification for giving the right of Eminent Domain is if it serves the public – which means – if you look it up – it has to accept business from others to also move their gas ….

      so I’d give them the right of eminent domain under the common carrier law but I’d also require that the gas only be sold domestically and not exported.

      there’s a problem here. Eminent Domain is not a “right” of a company. It’s granted when there is genuine and tangible benefit to the public BEYOND the company making a profit on their business operations.

      and just FYI – we’ve had two pipeline blowouts up our way – in the last 20 years and the last one pretty much shut down the City of Fredericksburg’s water plant – and ultimately convinced them to build side-stream reservoirs to protect their water supply – and not a penny of that cost came from the pipeline company.

  4. Malcolm Baldwin Avatar
    Malcolm Baldwin

    Taking off from Acbar’s comments, the environmental impact from getting this energy from the Marcellus shale via this buried pipeline, is indeed more benign than other available alternatives. I assume, but we should know, whether the pipeline dimension is more like 12″ rather than the 48″ Alaska oil pipeline! Coal from mountain top removal is an environmental disaster, electricity via 720 KV lines and towers (like the PATH transmission line that was withdrawn from lack of need) threatened a host of visual and property value assaults. The Keystone pipeline drawing from more tar sands mining has its own problems, although that mining may occur with or without Keystone.

    Stream crossings and habitat destruction look to be the biggest environmental issue, but they can be mitigated , or avoided. Then it all depends on whether there’s sufficient demand for the gas.

  5. Acbar Avatar
    Acbar

    Just one followup point: this proposed pipeline crosses two state lines and would deliver gas to multiple customers probably in all three states. I expect therefore it will be an “interstate pipeline” for purposes of regulatory jurisdiction. That means the Federal Energy Reg Commn or FERC (not Virginia or WV or NC) will call the shots both on permitting and eminent domain and the pipeline will have to operate as a common carrier. FERC is quite willing to listen to a State’s economic and environmental evaluations and objections but won’t automatically give the State a veto.

    1. larryg Avatar
      larryg

      I tend to like pipelines for their lesser impacts and a friend who was the transportation executive for a major chemical company told me that pipelines in general are 1/2 the costs of other means – before we even talk about the impacts of the modes – like transporting by rail or truck.

      but said pipelines are also big business and a competitive business – and in general the energy companies are not vertically integrated – i.e. the pipelines are owned largely by 3rd parties who sell transport service to companies like Exxon and others who move their product in pipelines they don’t wholly own.

      So if more pipeline capacity is needed – why are the energy companies building them instead of the existing non-energy companies who own and operate true common-carrier pipelines that move product for any company needing it?

      So I remain a skeptic that the existing lines and/or the existing lines current rights-of-ways and owners are not an expansion option easier than a brand new path – note than Dominion is not saying there is not enough existing capacity with 3rd party providers.. and maps show existing pipelines along the path they have outlined.

      Is this about a need for more capacity to serve the needs of Virginians or is this a entrepreneurial venture for Dominion to get into the business of retailing natural gas – not clear.

      the power grid – baseload coal tends to be near where the coal is mined and when it is not – You do not use Dominion railroads moving it to the plants.

      so why would Dominion not be building gas plants on the sites of the existing coal plants as “peaker” plants so they can supplement the baseload and gradually supplant the older plants with NatGas?

      I think the public is owed a more complete explanation than what we are getting – and the SCC should be behind increasing that disclosure.. since Dominion operates as a virtual monopoly anyhow.

      and back to Keystone – why would Canada not use the existing refinery capacity in Edmonton – or add to it there and provide jobs for Canadians as well as more gasoline for Canadians who pay about $5.00 a gallon for it?

      again – if a company is asking for eminent domain – they have a higher level of justification to meet – if their venture is to truly serve the public and not just a private company venture to primarily benefit them.

      and don’t get me wrong. I’m all for entrepreneurship and right for any company anywhere to operate by whatever legal means they can to be a competitor and a producer of jobs and economic vitality – as long as they operate – as a business – when dealing with others and negotiate and transact – as a business with others but when they want the power of eminent domain and other government assistance – then a higher standard needs to be met to insure that taxpayers are not turned into de facto investors.

      what does a guy who owns a piece of land – have to turn it over to a private company instead of him becoming a business partner with that company who provides services in exchange for compensation – of which is determined by a private transaction between a willing buyer and a willing seller?

      I think both DOminion and Keystone are doing “business” more than they are providing an unmet need of citizens … and I’m not opposed to it as long as it is disclosed that it’s really primarily private interests more than public benefit. Just because a company sells something the public “needs” does not mean it is serving the public interest. Competition is involved and in this case the taking of private property is involved.

  6. larryg Avatar
    larryg

    Digging into the issue a bit more – and – more clarity:

    ” Transco Joins Marcellus-to-Atlantic/Southeast Race”

    http://www.naturalgasintel.com/articles/99612-transco-joins-marcellus-to-atlanticsoutheast-race

    so basically you have several companies in a competitive race to build pipeline capacity through Virginia.

    Only Dominion appears to be an energy producer now moving into the pipeline business – the rest are pipeline companies – in the business of building and operating pipelines.

    Only a cynical person would ask if Dominion’s current favored status with the SCC and Va GA is a perceived advantage, eh?

    and let’s also point out that places like Norfolk, Hampton, Raleigh, et al – all currently have natural gas service to commercial and residential. There’s not a shortage of infrastructure to provide that need…

    so what is this really about? Who is going to buy the Marcus Shale gas?

    again – I am in favor of business .. I’m not on the side of the enviro-weenies who seem to be unable to choose energy options and oppose all of them in some fashion or other.

    But I do feel that if a private company wants the State to provide it with the right of eminent domain – that it should not be the pipeline equivalent of Kelo – which is little more than crony capitalism and rent-seeking behaviors that the Conservatives love to fly off the ends of their endlessly flapping tongues – and who are – nowhere to be found on this issue other than as rah rah cheerleaders…

    The use of eminent domain – the taking of property from unwilling property owners – requires a higher level of disclosure and justification beyond fatuous claims that the public is being “served”.

    I think this is funny – we go bonkers over something like Tysons Corner, Metro, tax credits for Filming, tax credits for shooting cremated remains into space – and when it comes to private companies taking land for private venture pipelines – no worries.. it’s as if most of us – believe – this is the “right” of these companies…

    Oh.. and the same folks who complain about the govt regulating and restricting private industry with expensive and unnecessary rules -and not protecting property rights – zippo on this issue…

    what am I missing?

    1. TooManyTaxes Avatar
      TooManyTaxes

      I think the issue under state law (to the extent applicable) is: whether the pipeline will be used for an “approved utility service”? The wholesale delivery of natural gas to local distributors would likely satisfy this test. The transport of natural gas for export might not pass muster. I suspect that bona fide mixed used (both utility and non-utility) purposes would permit the exercise of eminent domain. But a sham situation, where utility use was de minimus, should not permit eminent domain use.

      1. larryg Avatar
        larryg

        I think DOminion should have to say who the new customers will be. Will the availability of natural gas in and around Hampton and NC be expanded? Will new power plants use it all? Is any of it intended to be exported?

        Now, some might say, it’s nobody’s business but the company’s and ..I’d AGREE.. as long as they are not going to use eminent domain. But once they want to take someone’s property for the purpose of turning a profit by export – it’s no longer just their business. You don’t take land away from people for private profit.

  7. Jim Loving Avatar
    Jim Loving

    Dominion is moving to export LNG from its’ Maryland Cove Point site. Having a pipeline it controls enables conversion of Domestic NG to LNG for export. https://www.dom.com/corporate/what-we-do/natural-gas/dominion-cove-point

  8. Peter Galuszka Avatar
    Peter Galuszka

    Jim,
    Regarding Cove Point, Dominion can get Gulf Coast gas and also has access to Pennsylvania gas via another pipeline that has been around for years.

    1. TooManyTaxes Avatar
      TooManyTaxes

      Access to multiple sources is critical in this age of terrorism.

      1. larryg Avatar
        larryg

        A smart grid will also provide more protection and resiliency and flexibility.

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