RICHMOND, Va. — A spate of proposed gas pipeline projects have drawn sharp criticism from advocates who say the federal permitting agency has a built-in bias toward the industry.

Last week, nearly 70 people from almost a dozen states testified at what organizers called a People's Hearing, aimed at documenting bias and problems at the Federal Energy Regulatory Commission.

Delaware Riverkeeper Maya van Rossum said FERC almost always sides with the industry over citizens and the environment - in part, she argued, because more and larger pipelines add to the fees that fund the agency's budget.

“[Fees] increased the more pipeline projects that are approved and the greater the volume of gas that's approved to pass through them,” van Rossum said. "Throughout the 30 years that FERC has been funded in this way, it only rejected one pipeline project."

The industry and agency claim many of the proposed pipelines are being driven by pressure to get the large volume of new Marcellus and Utica gas to market. But Van Rossum said Congress should investigate.

By law, FERC permits pipelines that can demonstrate a public need. And it allows those companies to make a 14 percent guaranteed profit.

Like other agencies of its kind, FERC often relies on the specialized expertise of individuals from the industry. Van Rossum said over time, staff, consultants and even FERC commissioners move back and forth though what she called "a revolving door" between the regulators and the regulated. She said the situation results in a clear conflict of interest.

"In the case of one commissioner, he was reviewing and approving a pipeline project for the company where his wife worked,” van Rossum said.

Half a dozen separate pipeline projects are currently seeking approval to carry Marcellus and Utica gas to Virginia and the Carolinas - in spite of one study that found gas supplies are adequate through 2030.

One problem, Van Rossum said, is that companies will sometimes justify the need for the pipeline by showing contracts to sell gas from one branch of the corporation to another.

"The customer for the pipeline company delivering the gas is actually - in total or in part - the pipeline company itself,” she said.

Van Rossum argued that FERC has become a "rogue agency" that has been "captured" by industry - an especially problematic relationship in light of the agency’s power to grant eminent domain. She believes Congress should rein it in.



get more stories like this via email

As state budget negotiations continue, groups fighting climate change are asking California lawmakers to cut subsidies for oil and gas companies rather than slash programs designed to slow global warming.

Gov. Gavin Newsom's current proposal would cut oil and gas tax breaks by $22 million this year and $17 million the following year.

Barry Vesser, COO for The Climate Center, a nonprofit advocacy group, would like to see all subsidies eliminated.

"Oil and gas companies are one of the drivers of climate change, so we should not be making their profit margins bigger by providing public subsidies, and making it harder for renewables to compete against them," Vesser argued.

Gov. Newsom has also proposed to cut funding for climate-friendly programs helping lower-income families buy an electric vehicle or switch from gas to electric appliances.

Kevin Slagle, vice president of strategic communications for the Western States Petroleum Association, said in a statement, "California's already tough business climate is pushing companies to the brink. Removing incentives will drive California straight into the arms of more expensive foreign oil, ramping up costs for everyday Californians who can least afford it."

Vesser countered the threat of higher gas prices is a red herring.

"There's a lot that goes into calculating how much the cost of gas is, and this is not even pennies on the dollar," Vesser contended.

The state Senate's early action proposal estimated the budget deficit will be between $38 billion and $53 billion. The governor is expected to release new details on his budget priorities in mid-May. The Legislature must pass a balanced budget by June 15.

The New York HEAT Act might not make the final budget.

The bill reduces the state's reliance on natural gas and cuts ratepayer costs by eliminating certain rules. It was in both legislative chambers' one-house budgets, but last-minute scrambling could remove it.

New York League of Conservation Voters Policy Director Patrick McClellan said, aside from people's preference for natural gas, other challenges have made the bill hard to pass.

"I think that there has also been some irresponsible fear-mongering against this bill from some people who oppose it," said McClellan, "basically telling people this means that their natural gas service is going to be taken away from them tomorrow, or it's going to happen without warning, and that's just not the case."

The bill would not mean gas companies could walk away from providing service to new customers, since its effects occur over a longer period.

Rural lawmakers have been skeptical about relying solely on electricity, since people could lose power in bad storms.

If the bill isn't part of the budget, McClellan said the Public Service Commission can do more to require gas utilities factor climate change into their long-term plans.

It will take more than one bill for New York State to reach its climate goals.

McClellan said developing thermal energy networks is one way to build on what the HEAT Act would do, and provide good ways to decarbonize on a larger scale instead of going house by house.

"You're able to get a larger number of buildings and people all at once," McClellan explained. "The other exciting thing about thermal energy networks is, because you are talking fundamentally about piping systems that are underground, it's an extremely similar skill set for people who already work in the fossil fuel industry."

The bill would also eliminate the Hundred Foot Rule. This requires utilities to connect new customers to a gas line for free based on their distance to an existing main gas line, typically 100 feet.

This rule allowed utilities to shift around $1 billion in costs onto about 170,000 ratepayers.

Virginia's General Assembly will consider budget amendments to reenter the Regional Greenhouse Gas Initiative, known as RGGI.

Gov. Glenn Youngkin pulled the state out of RGGI at the end of 2023, and now experts said the holes in the budget left by RGGI funding going away are not being filled. Money from the program was used to fund climate mitigation work.

Jay Ford, Virginia policy manager for the Chesapeake Bay Foundation, said the state saw many benefits when it was part of RGGI.

"We were reducing fossil fuel emissions that were being created here in Virginia," Ford pointed out. "There were some clear reductions as a result of our participation. So, we're improving air quality and we are helping expedite that transition to a clean economy."

Virginia residents mostly favored staying in RGGI, but Youngkin has said the reason for pulling out was in his view, it was a "hidden tax" for ratepayers. Ford estimated homeowners paid around $2 a month from their electric bills for RGGI and argued the trade-offs were worth it.

Between 2021 and 2023, RGGI revenue generated around $828 million for Virginia. Ford thinks not rejoining the initiative could slow down Virginia's ability to reach the Clean Economy Act's climate goals, and warned other effects could be costly to communities.

"On the ground in communities around the state, if we don't get back into RGGI, there's a real potential that the work to prepare the Commonwealth, and prepare our communities for climate impacts, could grind to a halt," Ford contended.

Virginia used RGGI money to help towns and cities fund their climate resilience plans. The state used 25-million RGGI dollars to establish a Climate Resilience Fund. There have been 107 "billion-dollar disasters" since 1980 in Virginia, with long-term costs totaling between $20 billion and $50 billion.