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Monday, August 15, 2011


Big, new pipelines on tap for state
Monday, August 15, 2011
HARRISBURG -- Pennsylvania and the Marcellus Shale natural gas reservoir are emerging as a key focus of natural gas pipeline operators, as the increasing gas flow spurs projects to bring it to customers in the northeastern United States and possibly Canada.

More than half of the interstate natural-gas pipeline projects proposed to federal energy regulators since the beginning of 2010 involve Pennsylvania -- at a cost estimated at more than $2 billion.

That means hundreds of new miles of pipeline as part of a larger, traditional cross-country network that already extends through Pennsylvania and its neighboring states, as well as dozens of new or upgraded compression stations to force more gas through the buried pipes.

The projects are already employing thousands of contract workers and bringing work to steel mills, welders, gravel quarries and landscapers. At the same time, they are generating concerns about air and water pollution and eminent domain issues.

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Combined, more than a dozen projects proposed or already under construction would have the capacity to move an additional 4 billion cubic feet of natural gas a day -- one-third of what analysts for Colorado-based Bentek Energy say is the average daily demand in the northeastern United States.
"A lot of those projects are really designed to move the new volumes out of the Marcellus to your more traditional, historic pipelines that have served the Northeast markets for the last 30 or 40 years," said Bentek's manager of energy analysis, Anthony Scott.

For now, Bentek said about 3 billion cubic feet (bcf) per day of gas is flowing from the Marcellus Shale, the nation's largest-known natural gas reservoir. Production is rising quickly as crews busily drill more wells, and the flow should easily reach 7 bcf or 8 bcf per day in the next five years, Scott said.

But the exploration companies need to find takers for the gas, and Bentek analysts say more pipeline capacity is needed if the Marcellus Shale gas is going to ease price spikes at important New York City and Boston-area hubs during the coldest winter stretches.

Where the gas is already flowing into interstate pipelines, largely in southwestern and northeastern Pennsylvania, it is displacing pricier gas from more distant sources including Canada, the Gulf Coast, Rocky Mountains or terminals that accept liquid natural gas shipments from overseas, Bentek analysts said.

Similar pipeline construction followed earlier growth in shale gas production in Texas, Louisiana and Arkansas, said Jeffrey Wright, director of the Office of Energy Projects at the Federal Energy Regulatory Commission.

"You test it, you produce it and you develop it, and when things look promising, you have to have a way to get the gas to market, and that's when the pipeline proposals start coming in," Wright said.

The expansions come amid scrutiny after several high-profile pipeline accidents around the country and the need for Congress to re-authorize the last significant pipeline safety rules, adopted in 2006.

Armed with billions of dollars and a new technique for tapping gas from thick rock -- hydraulic fracturing, or fracking, combined with horizontal drilling deep underground -- major drilling companies began descending on Pennsylvania in earnest in 2008 to exploit the Marcellus Shale.

The formation lies primarily beneath Pennsylvania, New York, West Virginia and Ohio. Pennsylvania is the center of activity, with more than 3,000 wells drilled in the past three years and thousands more planned in coming years.

Cathy Landry, spokeswoman for the Interstate Natural Gas Association of America, said pipeline construction historically has been driven by demand from gas utilities or power plant owners. With the growth in gas production, partly from the Marcellus Shale and other shale regions now being explored, it's the exploration companies that are pressing for pipelines.

"It's the producers who want to get their gas to market," she said.

One of the largest projects, a $700 million expansion of Tennessee Gas Pipeline Co.'s 300 pipeline, is already under construction, employing 2,100 surveyors, inspectors and construction workers, according to the company. It received federal approval last year to lay approximately 127 miles of 30-inch pipeline -- along the existing 300 pipeline where possible -- through northern Pennsylvania and northern New Jersey, as well as the installation of two new compressor stations and upgrades of seven others.

To connect to the larger, interstate pipelines, other companies are moving forward in Pennsylvania on what is expected to be thousands of miles of smaller pipelines to ferry gas from producing well sites. Those gathering pipelines require various federal, state or local permits to cross wetlands, streams and roads, but not federal energy regulators' approval.

The region is already crisscrossed by major interstate pipelines, but it isn't accustomed to such heavy drilling or drilling-related activity. And while the industry is credited with bringing new life to local contractors, the pipeline construction at times is generating worries over how it will affect air, waterways and land.

Jan Jarrett of the Harrisburg-based environmental group PennFuture, said she is concerned about the impact of the pipeline construction on forests, wetlands and the countless high-quality cold water trout streams that spider-web northern Pennsylvania.

Joe Osborne of the Pittsburgh-based Group Against Smog and Pollution, or GASP, said there are concerns about air pollution from the growing number of compressor stations that pump gas through pipelines. He said the stations are sources of carbon monoxide and two other pollutants -- nitrogen oxides and volatile organic compounds -- that contribute to the formation of ground-level ozone. The U.S. Environmental Protection Agency says that can trigger or worsen breathing problems.
"In the Northeast, we already struggle to meet the federal health-based ozone standards," Mr. Osborne said.

In many cases, new pipeline would be buried along existing pipelines in the national network.
At least one new interstate project, the MARC I line proposed by a subsidiary of Kansas City, Mo.-based Inergy LP, is getting pushback from some residents and environmental groups in northern Pennsylvania's rural Endless Mountains region.

The EPA even weighed in, writing the Federal Energy Regulatory Commission to express concerns about the potential environmental impact of the line and question whether it is even necessary.
The line, which would travel into New York, would pose the threat of pollution to 111 sensitive streams and water bodies and split 39 miles of undeveloped forest and farm land in an area that supports a robust ecosystem, high quality of life and recreation, the EPA said.

But federal regulators have found the pipeline would have "no significant impact" on the environment and recommended that it be allowed to go forward. Bill Moler, president of Inergy's midstream division, said in a statement last month the company is confident that any environmental impact has been identified and either avoided or remedied in its plans.

Certification by the Federal Energy Regulatory Commission gives a company the right to seek court approval to take property by eminent domain -- a worry for some property owners in the proposed path of the MARC 1 whose families have owned the land for generations, said state Rep. Rick Mirabito, D-Lycoming. Before that happens, Mr. Mirabito said, those property owners should get the satisfaction of a stronger environmental analysis of the project.
Read more: http://post-gazette.com/pg/11227/1167397-503-0.stm#ixzz1V5uk17Si




Corbett quietly turning off the lights on renewable energy
Sunday, August 14, 2011
The Corbett administration is de-emphasizing renewable energy and energy conservation, eliminating programs created by previous Democratic and Republican administrations as it focuses on natural gas energy from booming Marcellus Shale.

Quietly but systematically, the administration has all but shut down the state Department of Environmental Protection's Office of Energy and Technology Deployment -- the state's primary energy office -- and removed directors and reassigned staff in the Office of Energy Management in the Department of General Services and the Governor's Green Government Council.

It has also forbidden state executive agencies from signing contracts that support clean energy supply.

The administration says merely that any changes are part of a new approach of Gov. Tom Corbett's energy executive, Patrick Henderson, who has been overseeing development of the administration's Marcellus Shale gas policy. But environmental organizations and former DEP officials and staffers say the dismantling of successful programs promoting renewable and sustainable

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The changes will put more than 100,000 "green jobs" in the renewable energy and energy efficiency industries at risk, according to Citizens for Pennsylvania's Future -- PennFuture -- a statewide environmental organization that last week launched a campaign to protect and restore programs and jobs it says are under attack.

"In the past 12 years, Pennsylvania has gone from having virtually no clean energy jobs to employing more than 106,000 Pennsylvanians in the clean energy industry, despite the national recession," said Jan Jarrett, president and chief executive officer of Penn Future. "These program cuts and legislative attacks threaten to kill those good, family-sustaining jobs."

According to PennFuture and DEP sources, the DEP's Office of Energy and Technology Deployment -- which had oversight of the state Energy Savings Law and the Alternative Energy Portfolio Standard, administered several clean energy grant programs, provided technical assistance to renewable energy companies and housed the state's climate change office -- has been downsized and is without a director at the Deputy Secretary level. The climate program has had its staff reduced from four to one.

One former DEP employee, who asked that he not be named because he continues to work on energy issues in Harrisburg, said of the Energy Office, "it's being taken apart piece-by-piece and the pieces are being thrown away."

The Green Government Council, created under Gov. Tom Ridge, a Republican, was established to help state agencies adopt environmentally sustainable operations. Its staff and program responsibilities have been "gutted," the employee said, and it continues to exist primarily to provide federally mandated tracking and performance reports for a number of federal energy programs.

The administration's prohibition against sustainable and alternative energy purchases reverses a policy that by the beginning of this year, had the state buying 50 percent of its electricity from renewable sources, according to PennFuture, and made it "a national leader in the development of the clean energy economy."

The Office of Energy Management has seen its director fired, its staff reassigned and, according to PennFuture, has been moved from the Department of General Services to the Bureau of Public Works. It administered the Guaranteed Energy Savings Act, which helps school districts and local governments invest in energy conservation and efficiency programs and conservation.

State Rep. William Adolph, a Delaware County Republican who authored the Energy Savings Act, is in discussions with the governor's office about how the program will be administered, said Mike Stoll, a spokesman for Mr. Adolph.

"We're still working with the administration to understand its position on the program," Mr. Stoll said. "It's saying this is part of a consolidation of programs but that doesn't change the requirements of the act."
The governor's office referred all questions about energy program and policy changes to Katy Gresh, a DEP spokeswoman, but she didn't directly respond to questions requesting specific information about program, policy and staffing changes. She did issue a general statement saying the department "continues to be the primary commonwealth agency for energy programs, energy emergency response and assurance, as well as alternative transportation fuel programs, and climate change," and that it is working closely with Mr. Henderson.

Ms. Gresh said eliminating the sustainable energy purchase program will save the state nearly $1 million. She cited two programs -- a $1 million grant program for small business energy efficiency and a still-in-development energy efficiency program that would use $1.5 million from the U.S. Department of Energy -- as examples of the state's continued commitment to energy conservation.

Christina Simeone, director of PennFuture's Energy Center and formerly the special assistant for energy and climate at DEP, said the policy changes and staffing reductions are crippling the department.
"I have concerns about whether the remaining staff of every office can handle the required workloads," Ms. Simeone said. "The programs and staff have been marginalized so much."

John Hanger, DEP secretary under former Gov. Ed Rendell, said it would be a mistake for the state to focus exclusively on natural gas.

"The changes we've seen are viewed as downgrading alternative energy programs, and I can understand how people can come to that conclusion," Mr. Hanger said. "I hope that's not the case, but the [administration's] actions could be interpreted as backing away for placing less emphasis on alternative energy."

It's very important that the state welcome all types of energy development, including wind, solar and biofuels and not become exclusively focused on Marcellus Shale gas, Mr. Hanger said Friday, while attending the dedication of 32 wind turbines in Cambria County. The 75-megawatt facility, built by Everpower, a New York City-based company with an office in Pittsburgh, will produce enough power to supply 32,000 homes and increases the amount of wind electricity produced in the state by 10 percent.

"It's important to have government programs that can help move forward alternative energy and it's important that state government be a model for the private sector, especially when doing so can save taxpayers money," Mr. Hanger said, referring to a DEP program promoting energy efficiency in government buildings.

Pennsylvania is not the only state reassessing or reducing sustainable energy, energy conservation and renewables portfolio standards policy. Governors and legislators have voiced similar concerns in Connecticut, Colorado, Florida, Iowa, Kansas, Maine, Maryland, Michigan, Minnesota, Missouri, New Hampshire, New Jersey, New Mexico, North Carolina, Ohio, Oregon, Oklahoma and Wisconsin, according to the Pew Research Center.

Ms. Simeone said changes in policy priorities could be expected because the 2010 election resulted in widespread state government leadership changes, but it doesn't make sense to pull support from renewable and sustainable energy sources when the rest of the world is turning toward them.

"Around the world countries are realizing there needs to be a mix of fossil and sustainable energy and unless we continue to diversify we will be left in the dust," Ms. Simeone said. "We should be doing everything we can to create jobs in those areas and embrace those opportunities. But what we're doing just doesn't make sense."
Read more: http://www.post-gazette.com/pg/11226/1167245-454.stm#ixzz1V5wW5SkJ
Don Hopey: dhopey@post-gazette.com or 412-263-1983.



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