The 41-mile Vermont Gas Systems pipeline now entering its final stages of construction has been built under an invalid permit, a Bristol attorney representing pipeline opponents has claimed in a recent Natural Resources Board filing.
The pipeline should have undergone review through Vermont’s Act 250 process rather than the state’s Section 248 process, he said — meaning that the Public Service Board that approved the project lacked jurisdiction to do so.
Vermont Gas representatives say that argument has no basis in reality, and said the pipeline conforms to all applicable federal and state regulations.
“The entire project is at this point in violation of Act 250,” said the company’s opponent in the case, attorney Jim Dumont.
The claim, which Dumont advanced while advocating on behalf of several Monkton and Hinesburg residents, hinges on whether Vermont Gas Systems is now building a transmission pipeline or a distribution pipeline.
Dumont argued in a filing to the Natural Resource Board’s District 1 coordinator William Burke that the pipeline meets the definition of a distribution line, and that it therefore must be permitted through the Act 250 set of land-use regulations.
Dumont in that filing asked Burke to therefore issue a jurisdictional opinion finding that the Public Service Board improperly reviewed and approved a project outside its jurisdiction.
The matter was already decided and agreed upon, more than a decade ago, by both the Public Service Board and Vermont Gas, Dumont argued.
The Public Service Board in 2003 deemed the Vermont Gas pipeline system — of which the 41 miles currently under construction is an expansion — a distribution system. Vermont Gas executives in that case actually argued the same: that their then-existing pipeline system serves a distribution and not a transmission function.
It’s the functional characteristics of the pipe system that the Public Service Board relied upon to make their determination in 2003, and Dumont argues those same characteristics define the expansion project as a distribution line as well. Public Service Board members in 2003 stated that future expansion of the Vermont Gas pipeline system should undergo the same test of functionality to determine whether such an expansion should be characterized as either distribution or transmission.
In the 2003 case, Burlington Electric Department tried to convince the Public Service Board that Vermont Gas Systems’ pipelines at least in part meet the definition of a transmission system. Burlington Electric would receive a more favorable rate were its argument successful.
The Public Service Board rejected BED’s contention, saying that the Federal Energy Regulatory Commission has a seven-part test that properly determines whether a pipeline transmits or distributes natural gas.
“Applying FERC’s seven-factor test leads to the conclusion that VGS is a distribution company that provides local distribution services,” the board wrote in 2003.
As examples of those seven criteria Vermont Gas Systems satisfied, the board noted Vermont Gas doesn’t sell wholesale to other distributors, and that gas flows into the Vermont Gas system but not out of it, and that all the gas Vermont Gas sells gets used within a relatively restricted geographical area. Those conditions still hold today, Dumont argued.
The seven-part FERC test should govern future Vermont Gas system expansions, the board said in 2003. That test should apply to the 41 miles of additional pipeline currently under construction, Dumont argued in his request last week to Burke.
Vermont Gas vigorously disputed Dumont’s assertions.
“This is the latest in a number of baseless claims brought forward by a vocal opponent,” said company spokeswoman Beth Parent.
Vermont Gas has operated transmission pipelines in Vermont since the 1960s, she said, and the project underway today is a transmission pipeline as well.
Federal regulations define the current project as a transmission pipeline, Parent said.
According to the relevant statutes, Parent said, a transmission line is one that “transports gas from a gathering line or storage facility to a distribution center, storage facility, or large volume customer that is not down-stream from the distribution center,” or one that “operates at a hoop stress of 20 percent or more SMYS.”
The Vermont Gas pipeline under construction meets both those criteria, Parent said. The company “transports natural gas from its transmission line to a distribution center via our gate stations,” she said, “and also operates [the pipeline] at more than 20 percent of SMYS.”
Dumont said that’s untrue.
The term SMYS is an acronym for “specified minimum yield strength,” and Dumont said it’s a designation that applies only to steel pipes. More than a mile of the Vermont Gas pipeline is made of plastic, he said, which means that it has no SMYS.
The Vermont Gas pipeline doesn’t meet the first criteria, either, Dumont said. The pipeline doesn’t transport gas from either a gathering line (one that collects the fuel from gas fields) or a storage facility, he said.
Further, Dumont said, the definition Parent cites doesn’t apply. It’s incorporated into Vermont law through a section of state statute that deals with pipeline safety, he said. The seven-part FERC definition described above actually governs pipeline construction, Dumont said.
In response to Dumont’s request, Burke gave several interested parties — including Vermont Gas Systems, the Vermont Agency of Natural Resources and the Vermont Department of Public Service — until Sept. 20 to respond. Dumont will have 10 days from that time to attempt to rebut whatever counter-arguments those parties might raise.
