MVP impacts to mountains, rivers and streams are excessive

From a Summary by Lewis Freeman, Allegheny Blue Ridge Alliance, March 8, 2021

A report released March 8 by the Institute for Energy Economics and Financial Analysis (IEEFA) concludes that the Mountain Valley Pipeline (MVP), a 300-mile pipeline that would move natural gas from the Appalachian Basin to markets in the eastern and southern U.S., is in financial jeopardy because of reduced demand projections and legal challenges.

The IEEFA report found four primary reasons to be skeptical of the pipeline’s financial viability:

● Revised forecasts now predict lower natural gas demand than when the project was first proposed. The U.S. Energy Information Administration predicts gas demand will fall at least through 2030 in the Southeast and mid-Atlantic.

● The likely cancellation of the Southgate Extension, a spur meant to funnel gas from the Mountain Valley project to North Carolina, weakens the financial case for the pipeline. Public Service Company of North Carolina has signed up for 12.5 percent of the Mountain Valley capacity. But if a North Carolina permit denial is upheld in federal court, the extension can’t be built—and the utility can’t use the gas.

● Gas produced in the Appalachian Basin and shipped through the Mountain Valley Pipeline to an interstate connection known as the Transco Pipeline must now compete with cheaper sources of natural gas. Prospects for saving money with gas shipped through the Mountain Valley Pipeline are already on shaky ground; the construction costs of the project have soared 60 percent beyond original estimates, to roughly $6 billion.

● Liquified natural gas (LNG) exports to Asia and the Pacific may not offset declining domestic demand. Asian LNG demand is predicted to be lower than originally anticipated; lower-cost producers such as Qatar could undercut Appalachian gas; new U.S. LNG export terminals face financing challenges; and any new terminals also are likely to look for less-expensive alternatives to Appalachian Basin gas.

The report notes that the MVP was approved under a 21-year-old Federal Energy Regulatory Commission (FERC) policy that bases decisions entirely on the existence of commercial contracts to purchase gas, rather than the actual need for new sources of gas.

A copy of the full report is available for your reading.

>>> ​Lewis Freeman, Executive Director, Allegheny-Blue Ridge Alliance
https://www.abralliance.org/