Citing financial risk, continued delays by FERC and state regulatory agencies, and strong, growing public opposition, multiple shareholders urged New Jersey Resources Corporation (NJR) executives at the company's Annual Meeting of Shareholders to withdraw from its 20% stake in the project, to honour their stated commitment to environmentally responsibility, and to invest in clean energy sources rather than polluting fossil fuels.
NJR shareholders who object to the PennEast pipeline project emphasized the following points at the meeting:
The NJ Division of Rate Counsel opposition to this project raises uncertainty as to whether the NJ Board of Public Utilities will allow New Jersey Natural Gas to build PennEast's gas transportation costs into their rate base. If those costs are not recovered it would affect the financial viability of PennEast and the potential return for investors.
Terese Flory Buchanan, a NJR shareholder opposing the pipeline, said she wants to see NJR make ethically, financially and environmentally sound investments. Regarding the Rate Counsel's letters to PennEast, Buchanan asked NJR executives: "How does that uncertainty affect the financial viability of this project and the potential return for investors if construction costs are not recovered?"
Federal and state agencies that also have jurisdiction over the project, including the NJDEP and the US Fish and Wildlife Service, have raised significant concerns about the project's environmental impacts. This suggests the project will face additional lengthy delays and may ultimately be rejected. FERC delayed the project for a third time earlier this week when they moved the deadline for the final Environmental Impact Statement from 17 February to 7 April of this year.
"I'm concerned about the financial risk and timing associated with the PennEast pipeline," said Susan Meacham, proxy for DiBianca Associates, an NJR shareholder. "The NJ Rate Counsel doesn't see the economics working for the consumer. I'm not confident they the true risks are being disclosed to both the investors and the SEC. I've not read about a contingency plan, including a valid alternative route. That's high risk. It's an old-school investment strategy. I strongly doubt it's a smart financial investment worth pursuing."
Pipelines are outdated investments
Building new pipelines today impedes progress toward the inevitable rise of renewable energy. Market forces are rapidly driving down the cost of renewables. Fossil fuel pipelines will eventually become stranded assets as we transition to cleaner, cheaper energy sources.
Buchanan questioned why the company is continuing to invest in old technology, saying: "I'm afraid NJR is going to be left holding billions of dollars' worth of outdated energy infrastructure."
Rather than lead the way in developing renewable sources of energy, NJR is instead participating in the surplus proliferation of natural gas pipelines in New Jersey. Gas is not clean. Pipelines leak methane that is 84 times more potent than carbon dioxide. Emissions from gas-fired plants increased 30% over the past two years in New Jersey. To meet long term emissions reduction targets under the Global Warming Response Act, New Jersey must reduce reliance on natural gas, making an unneeded pipeline a risky investment.
"I am asking the board to withdraw from PennEast and invest in alternatives that would be so much better for the environment, would create more jobs and permanent jobs, and would be a win-win investment," said Buchanan.
PennEast would threaten drinking water. Buchanan explained to NJR executives and fellow shareholders that the pipeline route cuts through one of the most environmentally sensitive areas of the state. She noted the proposed route crosses roughly forty 'C-1 protected streams and rivers' that provide drinking water for millions of people. PennEast, she said, has not done the research necessary to know what effect the project will have on water supplies.
Researchers from Princeton University and the US Geological Survey have warned that the pipeline could release dangerous amounts of arsenic, a carcinogenic toxin, into water supplies. These environmental threats could cause permitting delays or denials.
Michael Heffler, the proxy for NJR shareholder Dr. Rosina Dixon, also expressed concern about impacts on water. "The pipeline cuts directly through the main water transfer pipe for Lambertville's water supply. Several agencies, including the US EPA, have indicated that PennEast has failed to conduct adequate studies."
Heffler also pointed out that the pipeline would run very near the dam on the Swan Creek Reservoir, Lambertville's source of drinking water. "The NJDEP said that neither PennEast nor its consultants understand the hydrogeology of the route in NJ. They're concerned that blasting near the dam, which is classified as high risk, could cause it to rupture. If the dam ruptures, Lambertville would be flooded, causing significant loss of life and property."
NJR's mission statement says the company is "committed to enhancing our customer's quality of life by meeting their expectations for reliability and value in an environmentally responsible way – every day." The PennEast pipeline in fact would cause harm to preserved land and farmland, the water we drink and the air we breathe and directly contradicts that mission. In supporting PennEast, NJR is saying one thing, but doing another.
NJR shareholder, Jacqueline Evans, said: "When I purchased stock in this company it was because I believed your mission statement demanded that we act as responsible stewards of our environment for the next generation. However, NJR is a partner in the PennEast pipeline project, which has been plagued with negative press as an unneeded and unwanted projected that will undermine consumers' trust."
Buchanan said approximately 70% of the homeowners along the pipeline route in New Jersey have refused to allow PennEast to access their properties. Pipeline officials have made it clear that they intend to take the land via eminent domain.
"I certainly do not want an investment that uses eminent domain to usurp the rights and livelihoods of citizens to increase my dividend for an unneeded project," Buchanan concluded.
Read the article online at: https://www.worldpipelines.com/project-news/31012017/shareholders-oppose-penneast-pipeline-investment-at-njr-annual-meeting/