With Mountain Valley Pipeline LLC (MVP) and Atlantic Coast Pipeline LLC (ACP) expected to receive FERC certificates this fall, opponents are ramping up their efforts to challenge the projects through the courts.
A coalition of opposition groups and landowners led by Bold Alliance, Bold Educational Fund and Friends of Nelson County, filed a complaint Tuesday with the U.S. District Court for the District of Columbia seeking to stop the two pipelines from moving forward.
Echoing arguments from previous anti-pipeline lawsuits, the plaintiffs claim that FERC's granting of eminent domain powers to companies operating interstate natural gas pipelines under the Natural Gas Act (NGA) is unconstitutional.
Since the enactment of the NGA, the natural gas industry has moved "from a heavily regulated enterprise subject to strict oversight...to a deregulated market dominated by unregulated players in search of lucrative opportunities," the complaint stated. “The eminent domain provisions of the Natural Gas Act and the Federal Energy Regulatory Commission’s certificate program no longer further a public use and/or satisfy constitutional requirements. A challenge is long overdue."
The complaint argues that "FERC does not require pipeline companies to demonstrate their projects serve a public use" and the Commission's "standard of proof for 'project need' is so low as to be meaningless; indeed, FERC effectively waives it in cases where pipeline companies obtain right-of-way before" gaining a certificate, "thereby incentivizing those companies to wring easements out of landowners by any means necessary."
The lawsuit also accuses the Commission of withholding information from landowners "that they could use to refute project need" and failing to ensure that companies have "sufficient assets before commencing projects, thus creating a risk that those private, for-profit companies will not actually and ultimately pay constitutionally mandated just compensation for the property they take."
The coalition behind the complaint is seeking a declaratory judgment that FERC's implementation of its certificate program violates the NGA and the Constitution. The complaint also asks the court to prevent FERC from awarding certificates to MVP and ACP.
Aaron Ruby, spokesman for ACP backer Dominion Energy Inc., said the company is “reviewing the lawsuit and will vigorously defend” against the claims made, which he said include some “obvious factual errors.”
“The Atlantic Coast Pipeline will serve a critical public need. It will provide cleaner electricity and home heating for millions of Virginians and North Carolinians, and it will power local businesses across the two states. Our region’s existing pipelines are fully tapped and are unable to meet the growing energy needs of public utilities and the economy,” Ruby said. “FERC will thoroughly evaluate public need in its final order.”
Ruby also noted that ACP has “reached mutual easement agreements with more than 70% of the landowners on the route. All of these agreements were signed voluntarily by the landowners, after mutual negotiation and concessions on both sides. We do not have eminent domain authority, and we have not suggested that we do.”
FERC’s review of ACP, which has now taken over three years, “has been a rigorous and transparent process, and it’s left no stone unturned,” Ruby said.
ACP and MVP have each received final environmental impact statements from FERC and are expected to receive certificates later this year. Given that both ACP and MVP are major Marcellus Shale-to-Southeast greenfield pipelines with similar routes through largely undeveloped areas of West Virginia and Virginia, the projects have seen plenty of pushback from landowners and environmentalists.
The latest lawsuit echoes a similar challenge filed by landowners against MVP in July. The July court challenge, filed with a U.S. District Court in Virginia, also argued that FERC's granting of eminent domain powers to pipelines is unconstitutional.
Responding to the earlier lawsuit, lawyers representing MVP wrote that the challengers' "arguments regarding the public interest rely on their meritless objections to the NGA." Were the courts to intervene in FERC's process it "would violate the provisions of the NGA and deny the public the benefits of an agency decision."
They added, "Citizens, companies and government regulatory agencies need to know how their laws will be applied. The public interest is not served by...preventing FERC from doing that which Congress has charged it with doing."
Earlier this year, opponents of the proposed Nexus Gas Transmission pipeline also looked to the courts to try to prevent FERC from issuing a certificate for that project, arguing that the pipeline would not serve a public use and should not have eminent domain powers.
The 304-mile, 42-inch diameter MVP is designed to transport about 2 Bcf/d from the Marcellus and Utica shales to an interconnect with the Transcontinental Gas Pipe Line in Pittsylvania County, VA. The project is fully subscribed under 20-year firm commitments. EQT Midstream Partners LP would operate MVP as part of a joint venture with NextEra US Gas Assets LLC, Con Edison Transmission Inc., WGL Midstream and RGC Midstream LLC.
The $4.5 billion, 600-mile ACP is a 1.5 Bcf/d pipeline that would start in West Virginia and travel through Virginia and North Carolina. The project is designed to deliver Marcellus and Utica shale gas to serve heating and electric generation demand in Mid-Atlantic and Southeast markets.
Dominion Energy Inc. is developing ACP through a joint venture with Duke Energy, Piedmont Natural Gas and Southern Company Gas.
MVP is scheduled to enter service in late 2018, with ACP planned for service in 2019.