Written
by:
Brennan
Weintraub - Research Assistant
Jackie
Schweichler - Education Programs Coordinator
The
following information is an update of recent local, state, national, and international
legal developments relevant to shale gas.
Pipelines: Ohio EPA Seeks Feedback on Proposed Pipeline to
Run Through Parts of the Ohio Valley
On May 23, 2018, the Ohio Environmental Protection Agency
extended its public comment period
regarding the creation of Shell’s Falcon Pipeline,
which would carry ethane gas through the eastern part of the state to western
Pennsylvania. In particular, the agency is seeking comment on the potential
impacts that the pipeline might have on the state’s water sources. The project
has received some pushback from environmental groups, especially the Ohio Sierra Club,
and members of the local coal industry, who fear that the expansion of natural gas in the
region could have negative effects on their own business.
Electricity Generation: EIA Reports Electric Power Sector
Uses Lowest Levels of Fossil Fuels since 1994
On May 24, 2018, the U.S. Energy Information Administration (EIA) reported in their Monthly Energy Review that in 2017 the electric power sector utilized the least amount of fossil fuels since 1994. According to EIA, fossil fuel consumption by the power sector has declined due to the decreased use of coal and petroleum, even though consumption of natural gas has increased. Additional factors affecting this trend include changes in fuel composition and improvements in electricity generating technology. As of 2017, more coal was consumed by the power sector than natural gas, however, natural gas power plants produced more electricity. The EIA also reports that changes in consumption and efficiency assisted in producing the lowest levels of carbon dioxide emissions from the electric power sector since 1987.
On May 24, 2018, the U.S. Energy Information Administration (EIA) reported in their Monthly Energy Review that in 2017 the electric power sector utilized the least amount of fossil fuels since 1994. According to EIA, fossil fuel consumption by the power sector has declined due to the decreased use of coal and petroleum, even though consumption of natural gas has increased. Additional factors affecting this trend include changes in fuel composition and improvements in electricity generating technology. As of 2017, more coal was consumed by the power sector than natural gas, however, natural gas power plants produced more electricity. The EIA also reports that changes in consumption and efficiency assisted in producing the lowest levels of carbon dioxide emissions from the electric power sector since 1987.
Pipelines: PUC Judge Orders Sunoco to Shut Down the
Mariner East Pipeline
On May 24, 2018, administrative judge Elizabeth Barnes of
the Pennsylvania Public Utility Commission ordered that Sunoco halt construction on its Mariner East pipeline, which is designed to carry natural gas from western
Pennsylvania to the company’s processing facility in Marcus Hook, near
Philadelphia. The judge ordered that Sunoco provide a public risk analysis of
the pipeline and provide assessments of connected pipelines. The project had
previously been halted due to concern over sinkholes, but the PUC allowed the
project to restart
construction earlier this month.
Pipelines: FERC Extends Comment Period on Revising
Natural Gas Pipeline Process
On May 23, 2018, the Federal Energy Regulatory Commission
(FERC) issued an order extending the
public comment period regarding proposed changes to its policies on interstate
transportation of natural gas to July 25. The agency is considering changes in
how it determines whether proposed pipelines meet the standards of public
convenience and necessity and is soliciting comments from the public to
determine which, if any, additional factors should be considered. FERC’s
current policies date back
to 1999 and, according to the agency, are in need of an update due to
“significant changes in the energy markets, as well as in the production, use
and consumption of natural gas.”
Pipelines: Atlantic Coast Pipeline Begins Construction
On May 22, 2018, Dominion Energy began construction
on the Marts Compression Station for the Atlantic Coast Pipeline. The station
will provide compression to support the pipeline’s transmission of natural gas
between Harrison County and Greensville County, Virginia. While work on the
pipeline has begun, construction on a portion of the pipeline will be avoided
due to a court decision from last week. Specifically, on May 15, 2018, the U.S
Court of Appeals for the Fourth Circuit issued an order vacating the Dominion
Energy’s Incidental Take Statement for the Atlantic Coast Pipeline (Sierra Club, et al. v. Atlantic Coast Pipeline, No. 18-1083). The
court stated that the endangered species take limits were “so indeterminate
that they undermine the Incidental Take Statement’s enforcement and monitoring
function under the Endangered Species Act.” For now, approximately ten miles of
the pipeline will need to be on hold. The court stated that they will provide a
more detailed opinion at a future date.
Sovereign Wealth Funds: North Dakota Oil and Gas Legacy
Fund Has Earned Over $1 Billion
On May 24, 2018, Dave Hunter, the
executive director of the North Dakota Retirement and Investment Office reported to the
state legislature that the
Legacy Fund, which sets aside thirty
percent of all state revenue from oil and gas production as an emergency fund,
has earned over one billion dollars since its inception in 2011. The body
responsible for overseeing the fund, the Legacy and Budget Stabilization Fund
Advisory Board, voted on May 25,
2018, to maintain the fund’s current asset allocation.
Pipelines: New Hampshire Supreme Court Ruling Could Reopen
Debate Around Proposed Hydro Power Transmission Project
On May 22, 2018, the New Hampshire Supreme Court overturned a state
PUC (Public Utilities Commission) ruling against Eversource, which sought to
use electric rates to pay for an expansion to the existing Algonquin Pipeline.
The court overturned the PUC’s decision, that the use of electric rates to pay
for the pipeline would violate state law that requires the separation of
businesses that operate power plants from those that transmit electricity, by
determining that the functional separation of such businesses was not the
legislature’s “overriding purpose.” The court’s reasoning could revive
the controversy around the proposed Northern
Pass hydro power transmission project,
which would bring hydro power down to New Hampshire from Quebec. While the body
responsible for the project’s fate, the Site Evaluation Committee, has decided not to re-hear the application at this time, the ruling could provide new pathways for companies to
finance similar projects in the future.
Follow us on Twitter at PSU Ag & Shale Law (@AgShaleLaw) to receive ShaleLaw HotLinks
"Environmental group: Wolf is ignoring Supreme Court decision, misusing money from gas drilling" - StateImpact
"West Virginia Oil & Natural Gas Association, environmental group argue over study" - News and Sentinel
"Northeast region slated for record natural gas pipeline capacity buildout in 2018" - Hellenic Shipping News
"For Sale: Stalled Pipeline Project, Protesters Included" - Bloomberg Business
"Scotland hedges hydraulic fracturing stance" - OGJ Online
"Atlantic Coast Pipeline sees ruling sidelining only 10 miles of 2018 construction" - SP Global Platts
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Check out this week’s Shale Law in the Spotlight: UPDATE: Current Legal Developments Relating to Bureau of Land Management (BLM) Rules on Methane Waste Prevention and Hydraulic Fracturing
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