PUC Opens Final Line 3 Debate: State Remains Firm that Pipeline Isn’t Needed; Enbridge Adds More Concessions

People began lining up two hours before the start of the Minnesota Public Utilities Commission Line 3 hearing in order to get a ticket.

The Minnesota Public Utilities Commission (PUC) today began the first day of the final hearings on the Enbridge Line 3 tar sands crude oil pipeline, with a vote expected later this month. Day One went as well as could be expected for pipeline opponents.

The Minnesota Department of Commerce opened with a strong statement — reiterating its position that the state doesn’t need this pipeline. Meanwhile, Enbridge offered a new list of concessions — possibly an indication executives know their proposal is in trouble.

The PUC has scheduled additional hearings for Tuesday, and next week on Tuesday and Wednesday. A final vote could happen on any of those days, or the hearings could be extended. The PUC will vote on both a Certificate of Need and a Route Permit.

The PUC required people wishing to attend to get tickets to get into the main hearing room and overflow rooms. People on both sides of the debate began queuing up two hours before the hearing started in hopes of getting good seats. Some had signs, some had coffee.

Burden of Proof Not Met

The hearing started with opening statements by the intervening parties, with a particularly powerful presentation by Bill Grant, Deputy Commissioner of Division of Energy Resources for the Minnesota Department of Commerce. He renewed the Division’s recommendation, first made last year, that the PUC deny Line 3’s Certificate of Need.

Grant said the Division had reviewed Enbridge’s application and thousands of documents and analyzed Enbridge’s energy forecasts.

Enbridge is asking you, the Commission, to issue a Certificate of Need and a Route Permit which will relinquish through eminent domain 340 miles of northern Minnesota to a private company. Each of these 340 miles represents the livelihoods, homes, rights, clean water, culture, climate change impacts and people of Minnesota. The state of Minnesota is being asked to give up and place trust in this company and safeguard something more valuable than the price of this pipeline.

That is why Enbridge bears the burden to provide the state, and you, proof – data and statistics – not just their word or claims from supporters, that after weighing the evidence, this pipeline is in the public interest and thus is needed.

Nine months have passed since the Division of Energy Resources concluded that Enbridge did not satisfy its burden of proof due to the failings of Enbridge’s forecast and future use of its mainline system and the social and environmental harm that would be caused by the construction of a new pipeline. And those failings remain.

Concessions Upon Concessions

In his opening statement, Enbridge attorney Eric Swanson offered a new round of concessions. An MPR story summarized it well:

Enbridge said it would buy renewable energy credits to offset energy use after a new Line 3 is in service. In addition, Enbridge offered to work with those concerned about the old Line 3 to set up a trust fund to decommission all old pipelines in Minnesota.

Finally, Enbridge would put a guarantee in place by its parent company, Enbridge Inc., to ensure there would be cleanup money available in the event of a spill.

This builds on earlier concessions  offered by Enbridge CEO Al Monaco during a recent Duluth visit. A Duluth News Tribune article reported Enbridge committed to spending “$100 million to hire Native American workers and businesses for the Line 3 project” and “is now offering to remove old Line 3 pipes if the landowner wants them gone.”

Comment: If Enbridge were truly committed to these goals, it would have offered them from the start. This feels desperate.

Energy Reliability, Demand, and Safety

Leili Fatehi, attorney for the Sierra Club, criticized Enbridge’s proposal as “incomplete, non credible, and misleading.” She was particularly critical of Enbridge’s “safety” argument — that it needed to build a new Line 3 because it would be much safer than continuing to run the old one, as if those were the only two options available. In her testimony she said:

Enbridge’s central argument for why a new Line 3 pipeline is needed is that the catastrophic environmental and socioeconomic risks and impacts of building a new Line 3 pipeline are outweighed by the catastrophic environmental and socioeconomic risks and impacts of Enbridge continuing to operate (and ultimately abandoning) the old Line 3 …

Enbridge does not have the unfettered right to pollute today in order to extort a new Certificate of Need tomorrow. The decommissioning of the old Line 3 does not require that the Commission double down on an unnecessary infrastructure project …

After the intervenors opening statements, PUC Commissioners began questioning Enbridge and other parties about Enbridge’s energy forecasts — and whether or not Enbridge had met its burden of proof that the pipeline was needed.

At times, the debate went into the weeds, with jargon such “apportionment” and “nominations,” part of the esoteric world of how shippers buy and sell crude oil. Other times the debate went global, discussing whether or not initiatives by China and India to boost electric vehicles sales would depress global oil demand.

Questions that emerged included whether Minnesota should commit to expanding its fossil fuel infrastructure if the oil market is declining, whether approving the pipeline would run afoul of Minnesota’s energy policies and commitment to reduce fossil fuel use, and whether Enbridge had even done an adequate analysis of future oil demand.

Up Next in the Debate

The PUC likely will continue the discussion of energy demand on Tuesday. The issue of the “future adequacy, reliability, or efficiency of energy supply” is the first of four criteria the PUC needs to weigh in deciding on whether to approve or deny the Certificate of Need.

The current Line 3 is blue, the proposed reroute is in red. Light green shaded area reflects the “ceded lands” where bands retain rights to hunt, fish and gather.

The second Certificate of Need criterion is whether there is “a more reasonable and prudent alternative” to Enbridge’s proposal. This debate most likely will focus on a Friends of the Headwaters proposal to reroute Line 3 to the south, avoiding the pristine waters of northern Minnesota and running the pipeline through farmland that already had degraded waters.

The third Certificate of Need criterion is whether “the consequences to society of granting the certificate of need are more favorable than the consequences of denying the certificate.”

In this part of the debate, the PUC will focus on the threat pipeline spills pose to Minnesota’s environment, the disproportionate harm the pipeline would do to the Anishinaabe people and their treaty rights, and Line 3’s contribution to climate change.

As Commerce’s Grant explained:

If a spill were to occur, there could be significant affects to water resources in a new area where there are currently no pipelines. The environmental impact statement also concluded that there would be disproportionate and adverse impacts to tribal communities if the project were build, no matter which route was used.

Over and over during opening statements, Line 3 opponents reminded the PUC that the environmental impact statement found, and Judge O’Reilly’s report confirmed, that Line 3’s “social costs of carbon” would be $287 billion over 30 years.

This $287 billion cost is not paid by Enbridge, but shifted to other people, governments, and countries. Brent Murcia, one of the Youth Climate Intervenors, put the challenge to Enbridge concisely:

Enbridge completely failed to identify a single benefit of this project that even approaches that number [$287 billion] — even though they have the burden of doing so if they want to build this pipeline.

The last Certificate of Need criterion is whether the project complies with all state and federal rules and laws.

P.S. If you haven’t read it, check out the April 9 New Yorker article: A Saudi Prince’s Quest to Remake the Middle East, a profile of Saudi Arabia’s deputy crown prince Mohammed bin Salman. It talks about Saudi Arabia’s plan to restructure its economy because of flagging oil prices. Here’s a snippet:

At a gathering of prominent venture capitalists at the Fairmont Hotel, in San Francisco, [bin Salman] spoke bluntly about Saudi Arabia’s prospects. According to one attendee, he said, “In twenty years, oil goes to zero, and then renewables take over. I have twenty years to reorient my country and launch it into the future.”