A federal judge in Baltimore dealt AES Corp.’s proposed liquefied natural gas (LNG) terminal another blow last Friday, upholding Baltimore County’s zoning amendment that bans the construction of LNG facilities in certain Chesapeake Bay coastal areas.

U.S. District Judge Richard D. Bennett rejected AES’ challenge to the zoning amendment, which the company argued violated the U.S. Constitution and was preempted by the Natural Gas Act (NGA).

The judge had rejected a prior Baltimore County zoning ordinance that barred the siting of LNG facilities within five miles of residential zones and 550 feet of commercial areas. Bennett held that the first ordinance, passed by the county in 2006, was “unenforceable” because it was preempted under the Supremacy Clause of the Constitution by the NGA.

But “the zoning amendment at issue in this case, unlike the first zoning ordinance, only prohibits the construction of LNG facilities in Baltimore County’s environmentally sensitive Chesapeake Bay Critical Areas and has now been incorporated into the state of Maryland’s Coastal Zone Management Act program,” he said.

“This court declares that the zoning amendment…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,” the judge ruled in his 20-page plus decision.

“There is no dispute that the zoning amendment would prevent AES from constructing an LNG facility at the proposed Sparrows Point site, as the site is located within Baltimore County’s Chesapeake Bay Critical Area.”

In mid-June, Maryland’s Critical Areas Commission gave its stamp of approval to Baltimore County’s zoning amendment banning the construction of LNG facilities in certain Chesapeake Bay coastal areas. The commission’s action was needed to formally incorporate the change into the county’s coastal plan (see Daily GPI, June 12).

In January, the Baltimore County Council passed the zoning amendment prohibiting 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 Sparrow 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 Daily GPI, Jan. 9).

If built, Sparrows Point 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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