MN Dept. of Commerce Reaffirms Line 3 Tar Sands Pipeline is not Needed

Enbridge has not made a case that its proposed expansion and reroute of the Line 3 tar sands crude oil pipeline is needed, the Minnesota Department of Commerce reconfirmed in testimony filed Monday. The state’s refineries are operating at high levels and couldn’t handle an increase in volume. The regional  demand for gas is not projected to increase.

Ipso facto: No need for an expanded Line 3.

Kate O’Connell, Manager of the Energy Regulation and Planning Unit of the Minnesota Department of Commerce, Division of Energy Resources, said : “I conclude that Enbridge did not meet its burden of proof to show that its Proposed Project is needed.”

Quick reminder: As drawn up, the new Line 3 would run more than 1,000 miles from Alberta, through Minnesota, into Superior, Wisconsin. It would cross 337 miles of northern Minnesota, including the Mississippi headwaters and by many wild rice and recreations areas.

The Line 3 is a critically important decision with a complicated process to follow. The Minnesota Public Utilities Commission (PUC) will make the final decision in April, but for now the debate is happening on two tracks.

In one track, an administrative law judge is reviewing the adequacy of the Department of Commerce’s environmental impact statement (EIS). That judge will make one set of recommendations to the PUC. On the second track, a different administrative law judge is reviewing Enbridge’s request for a “Certificate of Need” and a “Route Permit.” That judge will make a separate set of recommendations to the PUC.

Both sides have been in a back-and-forth of testimony and rebuttal. O’Connell’s rebuttal testimony reaffirms the Department of Commerce’s earlier comments on the Certificate of Need. While her testimony can get technical, let’s look at a few pieces.

O’Connell’s comments relied on expert advice and testimony provided by Dr. Marie Fagan, Managing Consultant and Lead Economist at London Economics International, LLC.

According to O’Connell’s testimony:

Local refineries already near capacity: Refineries in Minnesota, North Dakota, South Dakota, and Wisconsin, as a group, have been operating at high levels. That indicates that they are not short on crude oil. In fact, if crude oil supply is increased, they have little room to increase processing.

We don’t anticipate increased regional demand: “Minnesota demand for refined products appears unlikely to increase in the long term, based on outlooks … Minnesota and its neighbors are generally not short of physical supplies of refined products.”

Enbridge Made Unrealistic Assumptions in its analysis for the Certificate of Need: Dr. Fagan concluded in her Sept. 11 testimony that Enbridge’s demand forecast did not consider “more than one potential future for oil supply, demand, or infrastructure.” Enbridge’s analysis about future oil needs assumed that Canada would not have any pipeline expansions for 14 years (from 2021 to 2035). Fagan said that is “inconsistent with historical records of expansions.”

During testimony, O’Connell was asked what conditions she would recommend if the PUC decided to approve the project. She listed several, including requiring Enbridge to:

• install no more than a 34-inch pipeline to replace the existing 34-inch pipeline;
• add two pipeline maintenance shops if any new pipeline, on any route, extends beyond Clearbrook;
• remove all exposed segments of existing Line 3 in Minnesota;
• establish a decommissioning trust; and
• implement the recommendations regarding insurance.

Placing those restrictions on the project would not be a victory we need, but they still would be a huge setback for Enbridge. It already has started to stage 36-inch pipelines around the state, expecting approval.

The news was well received in the environmental community. Margaret Levin, State Director for the Sierra Club North Star Chapter, issued the following statement:

“We are pleased to see the Department of Commerce confirm that Enbridge’s Line 3 expansion project would be all cost and no benefit for Minnesotans. If built, this pipeline would threaten Minnesota’s lands, water, wildlife, and Indigenous treaty-protected rights. At a time when there is no market demand for more tar sands, and Minnesota’s oil consumption rates are declining, there’s simply no good reason to allow Enbridge to build a dangerous new tar sands pipeline across our state.”