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Latest PUC Ruling Keeps Pipeline on Track As Opponents Lose Steam

A case that began with demands for the Mariner East pipeline to be shut down has ended with a $2,000 fine, and a growing realization that the $6.1 billion energy project is now all but certain to be completed.

A unanimous vote by the Pennsylvania Utility Commission (PUC) Thursday upheld an administrative law judge’s settlement in the “Safety Seven” case, brought by a group of Chester and Delaware County residents and the Andover Homeowners Association. During testimony in the 2019 hearing, opponents of the pipeline called it an imminent danger to their community and asked the PUC to end the entire project. “Shut down Mariner East before it kills us, pipeline foes implore,” read the headline in the Inquirer.

Instead, the state’s utility regulator ordered Energy Transfer, the company constructing the nearly-completed pipeline, to pay a modest fine, re-work some of its public communications and conduct a “depth of cover” and “distance between other underground pipelines/structures” survey regarding Mariner East 1 and the 12-inch workaround pipelines “as long as they are purposed for carrying highly volatile liquids.”

“We are pleased with the Commission’s action today which affirmed the Administrative Law Judge’s initial decision to deny the majority of the relief requested, but did confirm additional public awareness measures to which the company remains committed,” ET spokesperson Lisa Coleman said in a statement.

The resolution of the “Safety Seven” case sends yet another signal that green activists hoping to shut down the Mariner East pipeline are running out of options.

The 350-mile-long project began in early 2017 and parts of the pipeline are already in use. The pipeline carried natural gas liquids from the Marcellus shale fields in western Pennsylvania to the Marcus Hook Industrial Complex. Pennsylvania is the second-largest natural gas producer in the nation, and demand for the product is surging as Americans shift more energy production from coal and oil to the lower-carbon-emissions alternative.

Opponents of the pipeline have waged a non-stop war to block it, particularly in southeast Pennsylvania. They’ve seized on drilling-related problems along the line, including sinkholes and the inadvertent return of drilling mud that made its way into Marsh Creek Lake. While the company has paid around $16 million in fines, efforts by political opponents of the pipeline to stop the project have been fruitless.

In April, ET entered a consent decree with the Chester County district attorney’s office to resolve lingering issues after a high-profile announcement of a criminal investigation by then-D.A. Thomas P. Hogan. When the consent decree was announced, Seth Weber, a special prosecutor with the Chester County DAO, told Delaware Valley Journal, “We are not stopping the pipeline, nor do we want to.”

Last month, on the eve of announcing his bid for governor, Pennsylvania Attorney General Josh Shapiro announced 48 criminal charges against Energy Transfer over pipeline issues, including one alleged felony. Shapiro acknowledged most of the incidents in the grand jury presentment have already been addressed by the Department of Environmental Protection through civil actions, for which the company has already paid fines and made restitution.

“I’m here to tell you, that’s not enough,” Shapiro said at the time, though he also conceded his efforts would not lead to ending the pipeline’s construction.

That remains the goal of some progressive Democrats like Rep. Danielle Friel Otten, who was on hand at Shapiro’s announcement. “It is time for an immediate halt of the Mariner East pipeline project. I am once again calling on Gov. Wolf, the DEP, and the PUC to revoke Energy Transfer’s permits to operate in Pennsylvania,” she said.

And state Sen. Katie Muth told DVJournal, “A win for the environmental movement would be for this company to be kicked out of Pennsylvania for good.”

After Thursday’s ruling, it appears that is very unlikely to happen.

The full text of the PUC’s ruling can be found here.

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Green Activists Want Pols to Shut Mariner East Down. What Happens Then?

While Republicans say Attorney General Josh Shapiro’s announcement of criminal charges against Energy Transfer is really about politics and not the pipeline, Pennsylvania’s green activists are transparent about what they want.

Kill the Mariner East 2. And do it now.

Which raises the question, what happens if they succeed?

“Now that the attorney general and the grand jury have done their job, there should be no question: It is time for an immediate halt of the Mariner East pipeline project,” green activist Rep. Danielle Friel Otten (D-Upper Uwchlan) said after Shapiro’s press conference. “I am once again calling on Gov. Wolf, the DEP, and the PUC to revoke Energy Transfer’s permits to operate in Pennsylvania.”

State Sen. Katie Muth (D-Chester/Montgomery/Berks) joined Friel Otten and a handful of Pennsylvania progressives to make the same demand in a letter to the Wolf administration.

“We urge you to take immediate action to halt the Mariner East Pipeline project, revoke the company’s permits to operate in Pennsylvania, issue a moratorium on all future permits, and ensure all impacted residents have clean drinking water in their homes through a public water provider,” they wrote.

It’s an extreme stance, particularly given the $2.5 billion, 350-mile project transporting natural gas liquids from western Pennsylvania to the Marcus Hook facility is nearly completed, and thousands of energy sector jobs are at stake.

“Mariner East 2 is critical because the natural gas in southwestern Pennsylvania comes out of the ground with all kinds of other chemicals,” says David N. Taylor, president and CEO of Pennsylvania Manufacturers’ Association. “The natural gas itself is methane, but the methane comes along with ethane, butane, propane, pentane, and natural gasoline, so these are feedstocks that manufacturers can use to make things.”

That is why Taylor says it is so important to get those petrochemical feedstocks from where they are harvested to where they can be processed and then used as a manufacturing input.

“That’s the purpose of Mariner East 2,” says Taylor. “It’s to deliver those inputs from southwestern Pennsylvania to southeastern Pennsylvania.”

Energy Transfer projects the Mariner East and Marcus Hook projects will generate more than $100 million a year for Pennsylvania’s economy. Critics dismiss those numbers, but they concede the energy sector is a key part of the state’s finances.

Speaking about natural gas at an October 4 meeting of the Pennsylvania Senate Environmental Resources & Energy Committee, David Callahan, president of Marcellus Shale Coalition, said Pennsylvania has benefited greatly.

“Thanks to our abundant natural gas resources, along with our embrace of competitive energy markets, Pennsylvania has benefited from tens of billions of dollars in investment and several hundred thousand direct and indirect jobs, including those in the building trades,” said Callahan. “Nearly $14 billion has been invested to date in new natural gas-powered electric generation, not to mention the billions of dollars of investment and thousands of jobs associated with downstream utilization of natural gas and natural gas liquids such as the petrochemical facility in Beaver County that will open up considerable downstream opportunities.”

Callahan went on to add that these natural gas-related investments across the state have brought “billions of dollars to our communities and helped support thousands of more Pennsylvanians with family-sustaining wages.”

If activists succeed in shutting down the pipeline, it would leave manufacturers struggling to get natural gas-related raw materials they need.

“There are many manufacturing processes that require a temperature point that can only be met with natural gas,” says Taylor. “You may have heard about the Shell investment to turn ethane into polyethylene, and polyethylene is at the top of the top of the value chain that — depending on how you process it — can yield every kind of plastic, rubber, paint, glaze, sealant, adhesive, and solvent, all  consumer products people handle and use every day.”

And then there’s the looming national shortage of natural gas. The EU is already suffering through an energy crisis so severe that some nations are considering a return to coal. Lack of access to fuels, natural gas in particular, is driving electricity prices to all-time highs in Europe.

Now come warnings the U.S. may face supply issues as well. Ernie Thrasher, chief executive officer of Xcoal Energy & Resources LLC, told Bloomberg utility companies fear fuel shortages this winter could trigger blackouts.

“These utilities are worried the assets they have can’t get enough fuel,” Thrasher said. “There are people of high authority at large utilities who are deeply concerned.”

Pipeline politics aren’t helping. There has been a spate of pipeline closings due to political pressures since President Joe Biden took office in January. He issued an executive order canceling the Keystone XL pipeline on his first day on the job. In July, Dominion Energy and Duke Energy announced they were canceling the Atlantic Coast pipeline due to “legal uncertainty” in the face of repeated challenges from pipeline opponents. And the plug was pulled on the PennEast pipeline just months after winning a major victory before the Supreme Court for similar reasons.

If convicted, Shapiro’s office says Energy Transfer will be sentenced to fines and restitution.