AES Corp. has appealed a federal judge’s recent decision upholding Baltimore County’s zoning ordinance that bans the construction of liquefied natural gas (LNG) facilities in certain Chesapeake Bay coastal areas.

Arlington, VA-based AES is challenging the ruling in the Fourth Circuit Court of Appeals in Richmond, VA. The decision by U.S. District Judge Richard Bennett last month dealt a blow to the energy company’s plans to build its Sparrows Point LNG terminal in Baltimore, MD (see NGI, July 2). AES contends that Baltimore County’s zoning ordinance violates the Energy Policy Act of 2005’s (EPAct) amendments to the Natural Gas Act (NGA), which gave the Federal Energy Regulatory Commission sole jurisdiction over the siting of LNG facilities.

The NGA, as amended by EPAct, supersedes any local zoning ordinances, an AES spokesman told NGI. But Bennett ruled that Baltimore County’s ordinance “is not preempted by the Natural Gas Act and is within the delegated authority of the state of Maryland and Baltimore County under the Coastal Zone Management Act.” AES expects the Fourth Circuit to hear its appeal later this year.

In January, the Baltimore County Council passed the zoning ordinance barring the “establishment or expansion” of LNG facilities in all Chesapeake Bay critical areas. The county council’s measure was introduced and voted on within days of AES filing its application at FERC to build the Sparrows Point LNG project on the site of a former steel mill on a peninsula that juts out into Chesapeake Bay in the city of Baltimore (see NGI, Jan. 15).

Maryland’s Critical Areas Commission, which oversees development in the state’s coastal areas, last month approved the county’s zoning ordinance prohibiting LNG facilities in certain Chesapeake Bay coastal areas. The commission’s action was needed to formally incorporate the new law into the county’s coastal plan (see NGI, June 18).

The Sparrows Point project would have about 1.5 Bcf/d of regasification capacity with a potential for expansion to 2.25 Bcf/d. Regasified LNG would be delivered to regional markets via the Mid-Atlantic Express pipeline, an 87-mile, 30-inch diameter pipeline that would extend from the terminal to connections with interstate pipelines at Eagle, PA. The pipeline also would include connections with local distribution company Baltimore Gas & Electric.

The project, including three LNG storage tanks, would be located on 80 acres within the existing Sparrows Point Industrial Complex in Baltimore County. The site was previously owned by Bethlehem Steel and housed a steel manufacturing and shipbuilding facility.

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