Kinder Morgan critics say pipeline downsize proof pipe not needed at all

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Related | Kinder Morgan approves a downsized Tennessee Gas Pipeline project

Several opposition groups contend that Kinder Morgan's just-announced downscale of its proposed Tennessee Gas Co. pipeline through upstate New York and central New England supports their view that the Northeast Energy Direct project is not needed to meet regional supply requirements.

The lower daily volume of the 30-inch pipeline, reduced from the original 36-inch design, "is the bare minimum that Kinder Morgan was contemplating back at the beginning of 2014 when they announced their 'open season' to try to attract more customers," said Kathryn R. Eiseman, president of the Pipe Line Awareness Network for the Northeast, based in Cummington.

"Now they appear to be saying that if they have any chance of going forward with this pipeline, it will be for the minimum amount, with the hope of further expansion," she said. "This would cause the same amount of environmental upheaval and disruption to landowners during construction as a larger pipeline would — except that they are indicating that further disruption should be expected in coming years."

Eiseman cited statements by Kinder Morgan officials indicating potential expansions either in the towns currently targeted for compressor stations, or new ones to be determined.

"We've said all along that if they get their foot in the door, this new pipeline corridor would become the go-to location for additional compressor stations, as well as gas-fired power plants and other infrastructure," she asserted.

The company's decision to downsize the pipeline project was revealed in a second-quarter earnings call to investors on Wednesday, followed by a formal public announcement.

"The Kinder Morgan executives indicated various efforts they are making to attract more customers, which underscores that they aren't in the position they'd like to be to justify the pipeline," Eiseman said.

She added, "with competing projects more directly serving the power sector, the likelihood of Kinder Morgan securing additional customers from that sector is slim."

She also questioned the economics of the pipeline, and whether Kinder Morgan's investors "are going to take on the risk."

The company has announced 12 percent lower second-quarter earnings for 2015, compared to the previous year.

In Dracut, the terminal for the pipeline project, a statement issued by the local Pipeline Awareness Group declared that the downsizing reflects what "we have been saying all along — that a 2.2 billion cubic foot per day pipeline was more than we need and it appears that the Kinder Morgan Board of Directors has agreed."

"Even at 1.3 billion cubic feet a day, it is clear that the gas is intended mostly for export, because there are other expansion projects underway that will be in service much sooner than the Kinder Morgan plan," the Dracut opposition group asserted, adding that Kinder Morgan has "grossly exaggerating the demand for gas and electric power."

The group cited an ISO New England report stating that current wholesale prices for electricity in New England are at a 12-year low, and power demand in the last 12 months is at a 14-year low. ISO New England is an independent, nonprofit corporation that oversees and coordinates the flow of electricity across the six New England states.

Contact Clarence Fanto at 413-637-2551.


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