Our FERC submission

The FERC.gov site has been down for quite awhile today so I haven’t been able to file our submission yet. I’ve linked to it here:

Our submission – original PDF

Apologies for the length, I’m a pretty wordy individual.


The FERC website stayed up long enough for our submission to take ūüôā Our official comments (same as the document above are available below):

Our FERC comments – FERC Generated PDF

Our FERC comments – FERC Generated PDF Alternate Site

My FERC comments at the scoping meeting

The pipeline will carry 1 billion cubic feet of natural gas through it per day. PennEast says that’s “enough gas to serve more than 4.7 million homes”. In their FERC filing under “Purpose and Need” they state that “…the Project is designed to bring lower cost natural gas to homes and businesses in Pennsylvania and New Jersey”. They repeatedly state that this pipeline is for the benefit of New Jersey and Pennsylvania.

Here’s some facts taken from the U.S. Energy Information Adminstration (http://www.eia.gov/).

The entire state of NJ has approximately 2.6 million natural gas residential consumers. All of Pennsylvania also has about 2.6 million natural gas residential consumers. ¬†Combined that’s 5.2 million residential consumers.

PennEast is delivering enough gas for “4.7 million homes”. ¬†Wait, what? ¬†This pipeline carries enough gas to supply 90% of all consumers in both states? ¬†Why do we need this pipeline? ¬†We already have sufficient supplies for both states. ¬†In fact this is a smokescreen, this pipeline is vast over kill for NJ/PA residential use. ¬†Unless PennEast thinks NJ and PA will double the number of natural gas consuming homes, which seems a bit ridiculous on its face.

Maybe we should factor in all uses of natural gas in both states, both residential and commercial. ¬†eia.gov has those numbers too. ¬†In total NJ averages 1.8 billion cubic feet of natural gas consumption per day across all consumers, and 3.0 billion in PA. ¬†So that’s 4.8 billion cubic feet used by both states per day. ¬†These numbers still don’t add up – this one pipeline¬†represents 20% of our total commercial and residential consumption in the two states combined.

Worse Рsince 2011 PA has been a net-exporter of natural gas, thanks to the Marcellus Shale fracking operations going on there.  This means they already have an EXCESS of natural gas and certainly do not need more locally.

In fact the backdoor PennEast is trying to sneak in through is price volatility.  In January 2014  there was a sharp price spike in natural gas prices for a couple of days, peaking out near $120 when it is normally $4-$8.  From January 2009 to October 2013 there were 8 other short spikes of much smaller magnitude.

This is PennEast’s true justification. ¬†Because natural gas spikes a few days a year, we should get this 108 mile long, 3′ wide, high pressure natural gas pipeline. ¬†This will indeed reduce or eliminate those spikes.

Do you really think PennEast is spending a billion dollars to eliminate 10 days worth of price spikes over a 5 year period?

Of course not. ¬†Their justification is those 10 days in a 5 year span. ¬†Their real motivation is that they’ve already sunk a ton of money into Marcellus Shale production, and they want to ship that gas somewhere. ¬†We sure as heck don’t need it in NJ and PA, and they know that. ¬†Look at the eia.gov web site graph for total consumption in NJ and it’s been effectively flat since 1998. ¬†FLAT.

Their FERC submission highlights NJ and PA companies that will be using the gas provided. ¬†There are indeed some. ¬†But it doesn’t mention the non-NJ/PA companies.

You see companies like Spectra Energy, a part-owner in PennEast. ¬†Spectra has a grid of pipelines across the entire eastern sea board of the U.S. ¬†They show in their presentations that PennEast gas could go anywhere they want in that grid – including to LNG (Liquid Natural Gas) sites. ¬†Once in LNG form it’s shippable over seas.

It’s for companies like Crestwood. ¬†It’s proposing a new pipeline to connect to PennEast called the¬†MARC II Pipeline Project. ¬†Pipelines begetting yet more pipelines.

It’s for companies like New Jersey Natural Gas and their Southern Reliability Link project. ¬†The Southern Reliability Link is yet another pipeline they’re connecting to PennEast. ¬†More pipelines!

Take a look at what energy analysts in the market place think. ¬†Here’s an article from research firm Sterne Agee. ¬†It states:

Things are already ugly in U.S. natural gas markets, and its only going to get worse, according to research firm Sterne Agee. SA analysts Tim Rezvan and Truman Hobbs argue that the double whammy of continued supply growth amid weak demand mean that natural gas prices are still not done dropping, and slash 2015/2016 estimates across the board for the natural gas firms in their coverage universe.

Rezvan and Hobbs lower their 2015/2016 Henry Hub natural gas forecast ‚Äúto $2.70/$3.20 per mcf from $3.40/$3.70. We also trim our 2015/2016 WTI forecast to $58/$65 from $63/$70. The glut of oil and gas in the U.S. will require a lengthy, at times painful, healing process for coverage companies and E&P investors. Investors should remain bottoms-up focused, commodity agnostic, and prepared to look beyond 2015 gas price woes.‚ÄĚNatural gas prices likely to stay depressed well into 2016

Why do we need this pipeline again?

Objections to Tetra Tech

Many, many, many (many!) people have written to the FERC objecting to the appointment of Tetra Tech to run the environmental impact study of the PennEast Pipeline. Teresa from Pennington, NJ is one of them:

I request that FERC rescind the appointment of Tetra Tech to perform the
Environmental Impact Study for the proposed PennEast pipeline. It is
absolutely necessary for an unbiased company to undertake this most
important endeavor. Tetra Tech belongs to the Marcellus Shale Coalition.

This is a clear bias.

The health of our community depends on clean water. This pipeline will
cross a multitude of streams and waterways and disturb pristine lands
that serve as a filtration source for our drinking water. The
environmental impact statement must be unbiased and accurate. Public
Health is at stake here. FERC let’s get this environmental impact
evaluation done right. Please appoint a company whose true aim is to
determine the real impact that the PennEast will have on our environment.
Please rescind Tetra Tech’s appointment. If Tetra Tech is permitted to
submit a biased environmental evaluation this will reinforce the belief
that FERC doesn’t work and the pipeline application process is a sham
rather a meaningful process.

The basis of most of the objections is that Tetra Tech is an associate member of the Marcellus Shale Coalition (http://marcelluscoalition.org/). From what I can tell this organization exists primarily to promote Marcellus Shale exploitation. I’m not sure if being an associate member of this coalation is a smoking gun or not but it does seem to be a cause of concern.

Teresa’s submission is available below:

Teresa’s submission – FERC Generated PDF

Teresa’s submission – FERC Generated PDF Alternate Site

Delaware Township Citizens Against the Pipeline

There are a number of “CAP” organizations (Citizens Against the Pipeline) that have risen up against the PennEast Pipeline since it’s been proposed. One of them is DT-CAP – the Delaware Township chapter. Their submission states:

The Delaware Township Citizens Against the Pipeline, Inc. (DT-CAP) is a New Jersey not-for-profit furthering the following mission:

“To preserve and protect an irreplaceable community rich in farming and historic culture; to prevent the destruction of endangered species‚Äô habitats and fragile watershed ecosystems; to defend our thriving agricultural and recreational economies; to safeguard our citizens‚Äô proactive investment in conserved and preserved farms and woodlands; and to oppose PennEast pipeline as it will irrevocably impact the safety and integrity of our human environment.”

Our constituents include numerous property owners located within the path of the proposed pipeline route identified in PennEast’s January 13, 2015 Notice of Intent to Prepare an Environmental Impact Statement for the Planned PennEast Pipeline Project, Request for Comments on Environmental Issues, and Notice of Public Scoping Meetings (NOI). Additionally, our constituents include numerous property owners located within the path of the preferred alternative route, submitted to FERC on January 16, 2015. Members of DT-CAP participated in the open meetings conducted by PennEast in Delaware Township on September 29, 2014 and at South Hunterdon High School on November 13, 2014, and have attended additional public meetings and requested further information directly from PennEast regarding this application. Accordingly, DT-CAP is an interested party in this matter and direct notification to DT-CAP is required.

First, please be advised that DT-CAP does not support either the ‚Äúpreferred alternative route‚ÄĚ or the proposed original route due to the detrimental impacts both routes will cause to the environment, watershed, local economies, homeowner property rights, and taxpayer investments in the preserved and conserved lands of Delaware Township. DT-CAP opposes any additional natural gas pipelines in Delaware Township.

PennEast has not identified how the pipeline would be located with respect to the existing utility easement within Delaware Township. It is DT-CAP‚Äôs understanding that ‚Äúco-location‚ÄĚ is misleading in that the existing electrical utility easement must be widened, and in some locations, the pipeline may be near and not within the existing easement for power lines. Additionally, the existing above-ground utility within this easement is maintained in a different manner than is required for underground pipelines, and does not currently have the subsurface impacts which would occur when locating a pipeline. Therefore, co-location is inadequate to reduce negative environmental impacts. Additionally, the widening or nearby location of the pipeline as well as temporary constructions areas will impact lands currently not utilized for utility easements, and will have negative impacts on groundwater quality, farmland, and numerous additional resource values within Delaware Township. Additionally, the proposed alternative route requires the taking of property rights from property owners not in support of this project.

Second, the location, timing, and number of scoping meetings are inadequate and inconsistent with FERC regulations for the EIS scoping process.

The proposed alternative route has been submitted to FERC on January 15, 2015, only 12 days prior to the one and only scoping meeting to be held in New Jersey and only 28 days prior to the deadline for written comment as stated in the NOI. The January 27, 2015 New Jersey scoping meeting is not situated within the project area. And the announcement for the scoping meeting identifies the original route, with no reference to the proposed alternative route. Landowners and interested parties have not been provided adequate time to evaluate the proposed alternative route. The NOI must be re-issued to identify the proposed route and to provide further opportunity for public input. The coping period must be significantly extended with additional meetings scheduled, including meetings within the project area, and including at least one meeting scheduled in Hunterdon County, New Jersey.

DT-CAP and its members are prejudiced by PennEast’s failure to engage in a meaningful opportunity for discussion. PennEast submitted the proposed alternative route after announcing its intent to conduct scoping. PennEast provided inadequate time for scoping and inadequate advance notice of scoping meetings. And PennEast is engaging in scoping without identifying whether there are known safety and engineering constraints which would necessitate a widening of the existing utility easement, which is narrower in Delaware Township than it is in other affected municipalities. These errors cause material prejudice to those interested parties seeking to provide meaningful input during the scoping process.

Their submission is below:

DT-CAP Submission – FERC Generated PDF

DT-CAP Submission – FERC Generated PDF Alternate Site

Who benefits again exactly?

Michael in Pennington has a very in-depth submission to the ferc.gov.  What he (and everyone else) is wondering about is: who will this benefit again exactly?  Not vague assurances and statistics, but actual quantifiable results?

Ill perceived benefits

As I write, the the Penn East Pipeline Company is seeking approval from FERC to place a pipeline through our community. I have attended meetings and listened to presentations by their representatives who continue to tow the party line that the pipeline will be beneficial to the community because of the savings for the cost of gas and for the creation of new jobs.

Meanwhile, there are neighborhoods in the community through which the proposed pipeline would traverse that does not even have gas service. The gas distribution company in the area- PSE&G- which is also a member of the Penn East Pipeline Company conglomerate admittedly has no plans for service upgrades to serve the residents of those communities. Additionally, there is no specificity and no commitment for a set reduction in or delivery price for gas. The savings are neither quantifiable nor do they appear to be better than the rates that will be offered to communities that will not be impacted by the pipeline. In other types of government subsidized or enabled projects there are incentives to businesses and concessions made by those businesses that provide direct, quantified benefit to the citizens. One such example would be tax credits that are given to real estate developers for providing low or middle income housing. In these models there is a precise quantifiable benefit to private corporations and also a quantifiable benefit or value to citizens. The FERC model of review and grant of eminent domain to private entities does not even come close to quantifying a benefit to citizens. This is extremely problematic and disconcerting considering there is a taking of resources from ordinary citizens and licensing them to private businesses.

I have the same trouble with the PennEast assertions that this is good for our area.¬† There are assertions that the pipeline will have enough capacity to service “4.7 million homes” in the area. ¬† This is a nonsense statistic. ¬†According to the U.S. census bureau there are only¬†3,186,418 households in the entire state of NJ and¬†4,958,427 in all of PA. ¬†Does PennEast really expect us to believe this one pipeline is going to power the equivalent of 57% of all the households in the two states?

Of course not all households are served by natural gas, and households aren’t the only consumers.

So let’s go to the U.S. Energy Information Administration’s page and see what actual energy use in PA and NJ is:

NJ Monthly natural gas usage

PA Monthly natural gas usage

These graphs show the monthly usage breakdown for each in millions of cubic feet. Unfortunately they only do states, not regions, so we can only get the entire state breakdown. For reference the PennEast pipeline will deliver one billion cubic feet a day, so divide the table’s numbers by 30 (avg days in a month) to see how they compare to PennEast’s production.

NJ’s peak usage across all categories was 1.6 billion cubic feet a day.
PA’s peak usage across all categories was 2.9 billion cubic feet a day.

For a total of 4.5 billion cubic feet a day.

This mean’s the PennEast pipeline has enough natural gas flowing through it to supply more than 20% of both states natural gas needs combined.

Now shrink those numbers down to “Eastern PA and central NJ”, as PenNEast claims they’ll be helping, and this number climbs in excess of 100% of the total natural gas usage in the region.

Do you still believe PennEast is going to be using this natural gas in just our region? Or do you suspect Рas I and many people do Рthat PennEast is going to send this to a Liquid conversion plant for shipping overseas (where gas is much more expensive)?

Michael’s full comments are available here

Michael’s full comments – Alternate Site