By John Downey
Environmental groups cheered, some public officials expressed regret while others appear ready to simply move on as Duke Energy Corp. announced it and Dominion Energy Inc. have given up on the $8 billion Atlantic Coast Pipeline.
“This is a good move today and I appreciate Duke and Dominion for making it,” says Jim Warren, executive director of the watchdog group NC WARN. “I am hopeful that this is happening in conjunction with a major turn by Duke Energy and Dominion away from gas and toward the climate protecting future.”
Duke and Dominion, in explaining their decision, cite delays caused by regulatory and court challenges by environmental groups that drove up the costs of the project and the possibility of still more such challenges in the future.
The Southern Environmental Law Center has been involved in most of those challenges one way or another. But SELC attorney Greg Buppert says the ultimate success came not from legal strategy, but from unforced errors made by Duke and Dominion. “From the very beginning, the route they chose was a bad idea,” he says.
The 600-mile path from West Virginia to southeastern North Carolina went through protected federal lands, some of the steepest mountain terrain in the Appalachians and affected a number of vulnerable, often minority, communities.
Buppert says the companies were advised early on by agencies to look at alternate routes but refused to do so. Instead, he says, they doubled down. “In our view, these were self-inflicted wounds,” he says.
“To the extent we prevailed in these cases, we’ve made sure they had to comply with the law just like everybody else does,” Buppert says. “And when the companies ran into problems with their route, their strategy was to skirt legal requirements and that backfired.”
Buppert says the abandonment of the ACP, and an important Western U.S. court case that contributed to the decision, will likely have an impact on other pipeline projects, which SELC and its clients see as unnecessary. Among those likely to be affected, he says, is the Mountain Valley Pipeline in Virginia and its Southgate Extension into North Carolina’s northwestern Piedmont.
Sen. Joe Manchin, D-West Virginia, is among those lamenting the end of the project.
“I’m disappointed to learn plans to build the Atlantic Coast Pipeline have been canceled,” he says. “The pipeline would have created good-paying construction and manufacturing jobs for hard-working West Virginians, reinvested in our energy markets increasing our domestic energy supply, and strengthened national security with reliable energy to key military installations.”
He argues the project was carefully designed to protect the resources like the Appalachian Trail. “Today’s announcement is yet another reminder of why it is critically important we work together to find a responsible balance between the environment and economy.”
North Carolina’s Gov. Roy Cooper, who has had a difficult relationship with the pipeline that he ultimately supported, is one of those who simply wants to move on. “This decision and the changing energy landscape should lead to cleaner and more reliable energy generation in North Carolina,” he says. He is using the occasion to tout his own environmental efforts. “Our Clean Energy Plan provides an excellent framework and stakeholder process for renewable energy moving forward.”
Duke and public officials long promoted the project as an economic boon for the state. The ACP, originally pegged at $4.5 billion to $5 billion, was touted as a source for an $82 million increase in North Carolina’s gross state product, 925 direct and indirect jobs and $134 million in savings for utility customers over 20 years. The roughly 200 miles planned to run through North Carolina was expected to contribute more than $97 million to property tax collections in the state from 2020 to 2030.
But the project was widely opposed by environmental groups, conservation groups and landowner associations along its entire route.
It won its biggest court victory just three weeks ago, when the U.S. Supreme Court shot down a ruling from the 4th Circuit Court of Appeals that would have forced the pipeline to reroute around the Appalachian Trail.
But a ruling on the Keystone XL Pipeline, which struck down an accelerated Army Corps of Engineers process for granting pipelines permits to cross water bodies and wetlands, appeared certain to delay the ACP at least a year and raised the possibility it would ultimately be rejected. Faced with that, along with Dominion’s independent decision to get out of the gas pipeline transmission business, Duke and Dominion bailed.
The full impact of that decision is not yet clear. In 2014, Duke made it clear it intended to make gas transmission an important part of its business going forward. Its purchase of Piedmont Natural Gas Co. Inc. in 2016 was meant to advance that effort as well as expand the company’s footprint in the gas utility business.
But in the last year it has been forced to abandon its $270 million partnership in the $1 billion Constitution Pipeline in Pennsylvania and New York as well as the Atlantic Coast Pipeline.
It is still a partner in the completed Sabal Trail Pipeline from Alabama to Florida. But it is not clear Duke still has much appetite for the pipeline business.
“Our natural gas business remains central to our long-term strategy,” says Duke spokeswoman Tammie McGee. She talks in terms of existing infrastructure and alternative gas supplies with the ACP’s demise but will not comment on gas transmission’s role for now.
“The ACP was an ideal solution to meet the energy needs of our customers and the growth goals of our state,” she says. “Clean, reliable and affordable energy is the foundation for growth and we will continue to work for ways to meet that need, while investing in both our electric power and natural gas distribution businesses.”
Warren at NC WARN says he is looking to Duke’s 15-year Integrated Resource Plan filings, due with North Carolina regulators in September, for an indication of where the company may be heading.
“I don’t know what’s going to happen,” he says. “Just maybe this year we will see something real different in the IRP.”