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Atlantic Coast Pipeline project abandoned

by Peggy Mackenzie
Citing “ongoing delays and increasing cost uncertainty,” the Atlantic Coast Pipeline (ACP) was declared “shut down” in a joint announcement by Dominion Energy and Duke Energy.

“We regret that we will be unable to complete the Atlantic Coast Pipeline,” Dominion and Duke Energy chairs, presidents, and chief executive officers Thomas F. Farrell, II and Lynn J. Good said in a statement on Sunday, June 5. “For almost six years we have worked diligently and invested billions of dollars to complete the project and deliver the much-needed infrastructure to our customers and communities.”

The utilities’ announcement came a little less than three weeks after the pipeline scored an important legal victory when the Supreme Court ruled that it could pass beneath the Appalachian Trail. But environmental groups at the time pointed out that the project still needed eight other permits.

The legal climate described by Duke and Dominion in their statement reflects the growing vulnerability of all fossil fuel pipeline projects, reports bizjournals.com. The utilities’ executives cited as a major challenge the decision of the United States District Court for the District of Montana cancelling a stream-and wetland-crossing permit used by the Army Corps of Engineers to fast-track infrastructure projects. The ruling was prompted by a legal challenge to the Keystone XL pipeline in particular, but it ended up cancelling the permit for all new oil and gas pipeline projects without further review of their impact on endangered species.

Another factor in the ACP’s demise was that natural gas simply wasn’t very good business anymore, reports the Raleigh News and Observer. Years of public pressure, adding to the structural challenges facing the natural gas industry, including chronic oversupply, natural gas producers’ mountains of debt, and Wall Street investors’ loss of patience after years of unprofitability. Add to that, the worldwide economic slowdown caused by the pandemic which created a fossil fuel glut that effectively rolled back the fracking industry. For Duke and Dominion, all this combined to make the pipeline “a conspicuously bad deal.”

“The well-funded, obstructionist environmental lobby has successfully killed the Atlantic Coast Pipeline,” Energy Secretary Dan Brouillette said in a press statement on Sunday, adding that the project is “no longer economically viable due to the costly legal battles they would continue to face.” Over the past few years, a full-court press of legal challenges and mounting pressure from Indigenous tribes and a wide range of organizers had delayed the project and nearly doubled its projected cost—from $4.5 billion to $8 billion.

“The costly and unneeded Atlantic Coast Pipeline” designed to run from the Ohio Valley to West Virginia, where it would collect natural gas from the Utica and Marcellus shale deposits to coastal Virginia and then south to North Carolina, “threatened waterways and communities across its 600-mile path,” said Natural Resources Defense Council attorney Gillian Giannetti in a statement reported by The New York Times. The pipeline’s opponents insist that pipelines like the ACP are not in fact necessary to meet the country’s energy needs.

“All of the ACP’s problems are entirely self-inflicted,” Greg Buppert, a senior attorney for the Southern Environmental Law Center. “It was never a good idea to build this pipeline through two national forests, a national park, across the Appalachian Trail, and through the steepest mountains in West Virginia.”

The impact of successful fights against fossil fuel infrastructure reverberates beyond the projects they’re fighting, shifting the way other pipeline and fossil infrastructure projects are seen as well, and raising the political if not direct financial cost of natural gas investments.

On the Monday morning following the ACP announcement, a federal judge ordered a temporary shutdown of the Dakota Access Pipeline (DAPL), citing its slapdash environmental review process. In the DAPL decision, U.S. District Judge James Boasberg wrote that, while shutting the project down might seem extreme, the extent of the DAPL environmental review’s flaws, “and the potential harm each day the pipeline operates,” was such that “the Court is forced to conclude that the flow of oil must cease.”

Only time will tell whether DAPL backers think this debacle is worth the continued investment, or whether they—like Dominion and Duke Energy—decide it’s time to cut their losses on a project whose payoff, even without the protests, seems increasingly uncertain, concludes a report by The New Republic.

“Duke and Dominion did not decide to cancel the Atlantic Coast Pipeline — It took ‘a less genteel tool,’ — the people and frontline organizations that led this fight for years to force them into walking away,” stated Sierra Club Executive Director Michael Brune.