April 29, 2016

Will natural gas pipelines be overbuilt?

Overestimating the need for natural gas and the subsequent overbuilding of pipelines is a possibility, according to some experts in the field. NOT Dominion Power of course. That fear of not having sufficient natural gas for their power plants that are being converted from coal is what they are selling to regulatory entities. And to elected officials in Tidewater Virginia.

What most folks do not realize is that natural gas pipelines are regulated by the Federal Energy Regulatory Commission (FERC) and that agency does not have the same level of oversight as state regulatory commissions. The main factor that FERC looks at is whether a pipeline developer has been able to recruit enough companies to contract for capacity on that pipeline, not whether it is truly needed. If the pipeline is fully subscribed, it's a go. And who ultimately pays for that pipeline? You got it: the public.

Look for more on this topic from your local media. It will most likely not be on the front page.