Report Questions Mountain Valley Pipeline's Financial Viability
Tuesday, March 16, 2021
CHARLESTON, W.Va. -- The proposed Mountain Valley Pipeline may not be needed because natural-gas demand in the Southeast is expected to decline over the next decade, according to a new report from the Institute for Energy Economics and Financial Analysis (IEEFA).
The $6 billion pipeline project, which still is under construction, would bring gas from northern West Virginia to southwestern Virginia.
Jim Kotcon, chair of the conservation committee for the West Virginia chapter of the Sierra Club, opposes the project, citing water and air pollution from natural-gas operations and the need to reduce reliance on fossil fuels in order to fight climate change.
"We should not be planning for increased capacity when investments in energy efficiency and renewable energy can supply our needs with much less environmental cost," Kotcon contended.
The owners of the pipeline say the project is needed to meet regional energy demands.
But the report found current capacity is sufficient and projects less demand from foreign markets than was originally forecast.
Kotcon pointed out the contracts for much of the gas come from companies affiliated with the owner of the pipeline, and he predicts big rate increases down the line to pay for it.
Cathy Kunkel, energy finance analyst for IEEFA and co-author of the report, said the Federal Energy Regulatory Commission (FERC) has very rarely met a pipeline it didn't like.
"To my knowledge, they have only once denied a pipeline by saying it wasn't actually needed," Kunkel remarked. "Meanwhile the industry is overbuilding pipelines left and right."
President Biden recently appointed a new chairman of FERC, Richard Glick, who has said he intends to review the agency's policies on new natural-gas pipelines.
Meanwhile, both the Mountain Valley Pipeline and a proposed extension into North Carolina are tied up in ongoing litigation.
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