July 26, 2023

Merkley, Wyden Urge FERC to Reject Fossil Gas Pipeline Expansion

Senators: “GTN Xpress is simply incompatible with the laws of the states of Oregon and Washington.”

Washington, D.C. – Today, Oregon’s U.S. Senators Jeff Merkley and Ron Wyden sent a letter to the Federal Energy Regulatory Commission (FERC) following up on previous requests to deny permits for TC Energy’s Gas Transmission Northwest (GTN) Xpress project. With FERC’s decision expected this week, the Senators warn that the expansion of this pipeline is not necessary or prudent and would only increase costs for Oregon consumers and undermine laws in both Oregon and Washington State.

“There is no clear justification for, or benefit from, GTN Xpress. TC Energy has entered into a precedent agreement with Tourmaline, a Canadian fossil gas producer that is not seeking to serve ratepayers,” wrote the Senators. “[Further,] if Tourmaline’s uses for the fossil gas are too uncertain to assess their environmental impact, it strains credulity that they could serve as the justification for a pipeline expansion.”

The Senators highlight the lack of justification and benefit from the GTN Xpress, and their letter points to the fact that FERC itself has said that it is unable to assess how or where Tourmaline’s gas would be used to show that TC Energy has failed to demonstrate the need for this pipeline project.

“GTN Xpress is a significant fossil fuel expansion at a time when Oregon and Washington are moving away from fossil fuels. GTN Xpress is simply incompatible with the laws of the states of Oregon and Washington. At the same time, TC Energy has failed to show that there is adequate need for the GTN Xpress. We urge you to find that GTN Xpress is not in the public interest, and to deny the application,” the Senators’ letter concludes.

Full text of the letter can be found here and follows below:

Dear Chairman Phillips and Commissioners Christie, Clements and Danly:

 

We write to urge the Commission to reject the request from TC Energy for a certificate of public convenience and necessity (CPCN) at your July 27^th meeting. TC Energy’s precedent agreements fail to demonstrate that the proposed GTN Express pipeline expansion meets section 7(e) of the Natural Gas Act’s requirement that a project “is or will be required by the present or future public convenience and necessity.”[1] . In fact, the record shows just the opposite: GTN Xpress is neither necessary nor beneficial because it will either increase costs for Oregon and Washington consumers or undermine the laws of Oregon and Washington.

 

On February 18^th, 2022, the Commission released an Updated Policy Statement on Certification of New Interstate Natural Gas Facilities that recognizes that “the existence of precedent agreements may not be sufficient in and of themselves to establish need for the project.” On March 24th, 2022, the Commission designated this Policy Statement on Certification of New Interstate Natural Gas Facilities as Draft.[2] This return to the 1999 standard continues to impede the Commission’s ability to address the disparate impact of natural gas projects on Black, Brown, Indigenous and other frontline communities, and the Commission should act quickly to update its Policy Statement.

 

The Updated Policy Statement on Certification of New Interstate Natural Gas Facilities is a more accurate reflection of the language and intent of the Natural Gas Act the DC Circuit ruled in Spire that circumstances required the Commission to look behind the precedent agreement when determining whether there was a market need for the pipeline. We believe the facts here require the Commission to undertake a similar analysis of GTN XPress.[3]  When one looks behind the precedent agreements it is clear that TC Energy has failed to demonstrate that there is adequate need for the 150,000 Dth/d of fossil gas that GTN Xpress would carry, let alone that project benefits outweigh adverse impacts on economic interests. 

 

There is no clear justification for, or benefit from, GTN Xpress. TC Energy has entered into a precedent agreement with Tourmaline, a Canadian fossil gas producer that is not seeking to serve ratepayers. The Commission’s own Final Environmental Impact Statement for GTN Xpress said it was unclear where Tourmaline’s gas would be delivered or for what purpose, concluding that “downstream emissions from Tourmaline’s subscribed capacity are not reasonably foreseeable.”[4] If Tourmaline’s uses for the fossil gas are too uncertain to assess their environmental impact, it strains credulity that they could serve as the justification for a pipeline expansion.

 

In fact, TC Energy has failed to demonstrate that fossil gas is needed in Oregon and Washington at all. Its sole named customer in Oregon and Washington, Cascade Natural Gas, entered a precedent agreement for 20,000 Dth/d of gas from GTN Xpress, yet the Washington and Utilities Transportation Commission (WUTC) staff questioned Cascade Natural Gas’s need for the project.[5] GTN Xpress will likely increase natural gas prices for Oregonians and Washingtonians, and state utility regulators have found that GTN’s proposal is inconsistent with state laws limiting gas use and emissions.[6]

 

GTN Xpress is a significant fossil fuel expansion at a time when Oregon and Washington are moving away from fossil fuels. GTN Xpress is simply incompatible with the laws of the states of Oregon and Washington. At the same time, TC Energy has failed to show that there is adequate need for the GTN Xpress. We urge you to find that GTN Xpress is not in the public interest, and to deny the application.

 

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