Enbridge promised the Minnesota Public Utilities Commission (PUC) that the Line 3 Decommissioning Trust Fund would be in place before it started Line 3 operations.
It turns out to be an empty promise, because it’s not enforceable. Enbridge will start Line 3 operations in the coming weeks, and the PUC has yet to open proceedings on the Decommissioning Trust Fund.
It’s one more act in the Kabuki theater that’s Minnesota’s regulatory oversight of Enbridge Line 3: All image, no substance.
In a further slap to the face, Enbridge will start operating Line 3 even though the public just learned that the company willfully violated construction plans, damaging a sensitive wetland. Enbridge kept the problem from the state for months, a violation of trust. The state’s failure to take this violation more seriously sends the wrong message to Enbridge.
It raises questions about whether similar problems exist along the construction route that were kept hidden.
The PUC required Enbridge to have a Line 3 “Decommissioning Trust Fund” in place as a permit condition. The Fund would “cover the costs of decommissioning and removing the new Line 3 at the end of the pipeline’s operation,” estimated at 50 years.
According to a July 16, 2018 compliance filing with the PUC, Enbridge wrote that it was “committed to having the Decommissioning Trust established before L3R [Line 3] is in-service.”
Enbridge reiterated that commitment in a July 30, 2018 letter from Enbridge attorney Christine Brusven to then-PUC Executive Secretary Daniel Wolf. “Enbridge unequivocally stated that it ‘is committed to having the Decommissioning Trust established before L3R is in-service.’ That remains the case.”
That letter was written three years ago and there doesn’t appear to be any movement on negotiations.
According to Will Seuffert, the PUC’s current Executive Secretary: “There is no requirement that the trust fund be established or funded on a specific timeline, and the MPUC plans to open a docket to establish the details of the trust fund later this year.”
At this point, the PUC has no power to stop Enbridge from operating the pipeline even if it wanted to.
Enbridge only has to give the PUC at least three days notice prior to starting operations, Seuffert said in an email. It needs to specify “the date on which the pipeline will be placed into service and the date on which construction was complete.”
There are issues in dispute around the Decommissioning Trust Fund. By not tying the Line 3 start date to final language on the Decommissioning Trust Fund — something Enbridge committed to do — the PUC lost negotiating leverage.
It’s clear Enbridge will do what it can to lower its costs.
Enbridge estimated decommissioning the new Line 3 would cost $983 million. (Compare that to Enbridge’s estimate to decommissioning the existing Line 3. It said it would have cost $1.28 billion. The new Line 3 is nearly 50 miles longer than that the existing one, and should be more expensive to remove.
DOC-DER estimated the cost to decommission the new Line 3 in 50 years at a minimum of $1.5 billion, adjusted for inflation.
The PUC sided with the DOC-DER estimate.
Enbridge also wanted the Trust Fund agreement to be in line with what Canada’s National Energy Board requires. (The Canadian system would appear to financially advantage Enbridge.)
Enbridge said it would require state law changes. DOC-DER opposed state law changes.
On Sept. 7, 2018, Brusven wrote the PUC stating Enbridge would continue to seek ways to have the Decommissioning Trust Fund function more like Canada’s version. However, “those efforts are not an impediment to establishing a fund prior to Line 3 Replacement going into service.”
Its par for the course for the PUC not to hold Enbridge accountable for its promises.
Recall Enbridge promised the PUC that Line 3 would create 4,200 union construction jobs, half expected to be filled locally.
Initial reports from Enbridge showed it was falling well short of the mark on local hiring. Instead of addressing the problem, Enbridge stopped reporting the numbers. (The PUC didn’t require it, or impose sanctions if Enbridge failed to meet its jobs promise.)
Advocates working to end Missing and Murdered Ingenous Women (MMIW) warned that the Line 3 construction and the influx of out-of-state workers would raise the risk of sex trafficking. Enbrdige told the PUC that wasn’t the case.
In less than six months in 2020, four Line 3 workers were arrested in sex trafficking stings. We have no idea how bad the problem was because the PUC required no reporting of known incidents, nor imposed any sanctions against such problems.