State regulators on Thursday questioned whether to postpone review of Vermont Gas’ proposed pipeline extension from Middlebury to New York.
The South Burlington natural gas utility must obtain a federal regulatory waiver before the state has the authority to approve the pipeline project that crosses state lines to the International Paper mill in Ticonderoga, New York.
But first Vermont Gas must submit an application for a section of the project to New York regulators for approval. Steve Wark, the spokesman for Vermont Gas, said Friday the company won’t file an application until September.
Without this application, federal regulators may not decide on the waiver. Until Vermont Gas obtains the waiver, the state does not have full authority to permit the pipeline.
Vermont Gas applied for the state permit last year. The Vermont Public Service Board is now asking parties involved in the permit application if hearings scheduled for October should be changed.
Wark said Vermont Gas wants to keep the hearings scheduled for October.
The Federal Energy Regulatory Commission, or FERC, must issue the company a federal review exemption under the Natural Gas Act in order for Vermont regulators to have jurisdiction over the project.
Vermont Public Interest Research Group, an environmental advocacy group opposing the pipeline, requested in January that Vermont regulators throw out the case because it did not have jurisdiction. VPIRG also asked FERC to deny Vermont Gas’ waiver request.
The board denied VPIRG’s motion to dismiss the case in February based on information Vermont Gas provided indicating it would receive a decision on the waiver from FERC by late spring this year, the board said in Thursday’s ruling.
Vermont Gas on Aug. 1 told the Public Service Board it would have its application to New York regulators completed shortly.
But Wark said the company had to relocate a gate station on the New York side of the project. The other part of the application includes a section of pipeline to connect the gas to the paper mill.
Jim Dumont is a Bristol-based attorney representing pipeline opponents, including VPIRG. He requested state regulators to drop the case because he said it remains unclear whether the state’s Section 248 review process is even the right process. He said the parties are spending time and money on a case that may not exist.
The Conservation Law Foundation, an environmental law firm opposing the pipeline, joined VPIRG in asking the board to dismiss the case.
“The fact that Vermont Gas has not made all the required filings for FERC to rule is very troubling,” Sandra Levine, a senior attorney at the Conservation Law Foundation, said. “Vermont Gas continues to try and steamroll the Vermont project ahead without doing its own homework to make sure all of the pieces are in place.”
Levine said it is premature for Vermont Gas to file for the second phase of its pipeline extension.
“I think the record of Vermont Gas in Phase One has not been good, both in terms of cost estimates and acquiring the easements that they need,” she said. “I think the board seems to want to make sure that all of the appropriate or necessary filings are in place before it moves forward with Phase Two.”
Without the waiver, the Public Service Board’s decision would only represent Vermont positions on the pipeline before the FERC review process, regulators say.
Vermont Gas is optimistic it will reach easement agreements with all landowners. The company says it has settled with 70 percent of the landowners, 20 percent are likely to sign and 10 percent remain opposed to the project.
If a waiver is not granted, FERC would conduct an environmental impact assessment of the project on both sides of Lake Champlain. Dumont said this could take six to 12 months followed by a public comment period.
The cost of the second phase of the project was estimated at $49 million to $64 million earlier this summer and was last estimated at $74 million. The paper mill will pay for nearly the entire cost the pipeline.
Donna Wadsworth, communications manager for International Pater in Ticonderoga, said the pipeline still provides the company with economic and environmental benefits. The company plans to switch from No. 6 fuel oil to natural gas for its power generator, she said.
Wadsworth said the company is confident in Vermont Gas’ latest cost estimates.
The first phase of the company’s project was approved last December. The project connects service in Chittenden and Franklin counties to Middlebury. The company said Friday it started drilling the pipeline.
Correction: An earlier version of this story reported the wrong date for when Vermont Gas would apply for a permit in New York.