On the same day last month that North Carolina’s environmental agency issued a crucial water quality permit that allowed the contentious 600-mile Atlantic Coast Pipeline to proceed, Gov. Roy Cooper made another announcement.
Cooper’s office said the state had reached a $57.8 million deal with the pipeline developer, a group that includes Richmond-based Dominion Energy and North Carolina heavyweight Duke Energy, to mitigate the damage that construction of the 42-inch natural gas pipeline may cause to forests, waterways and other natural resources.
Virginia, it turns out, had signed a similar deal about a month earlier for an identical amount in the final weeks of Gov. Terry McAuliffe’s administration, though with none of the fanfare, raising eyebrows among pipeline opponents.
That agreement, and a similar deal that secured $27.5 million in mitigation money from the developers of the shorter Mountain Valley Pipeline that will cross into Southwest Virginia, still do not appear on new Gov. Ralph Northam’s website or that of Virginia’s secretary of natural resources.
“These agreements were signed with the understanding that both MVP and ACP would file them on the (Federal Energy Regulatory Commission) docket as part of their forest mitigation plan,” said Brian Coy, who was McAuliffe’s spokesman and is continuing in the same role under Northam. “That is the typical way in which these documents are made public.”
The agreements have also been filed with General Assembly’s House and Senate finance committees, Coy added.
As of Thursday, however, the ACP agreement had not been filed with FERC, which approves interstate natural gas pipeline projects. And they’re not required to be, said Tamara Young Allen, a FERC spokeswoman.
Aaron Ruby, a Dominion spokesman, said the agreements will be filed with FERC when the company has finished a similar outstanding mitigation agreement with West Virginia. Shawn Day, a spokesman for the Mountain Valley Pipeline, said the Virginia mitigation deal was filed with FERC on Jan. 25.
But the non-announcement — coming near the end of a Virginia environmental review process for the pipeline projects that has been criticized for lacking rigor and clarity — has raised suspicions.
Jonathan Sokolow, a 58-year-old lawyer from Reston and blogger at the progressive website Blue Virginia, dubbed the agreement a “secret immunity deal” that says, “no matter how much damage is done, as far as the state is concerned, Dominion is off the hook.”
“I’m surprised it wasn’t public at the time it was signed,” said Greg Buppert, an attorney with the Southern Environmental Law Center in Charlottesville, which has fought both pipeline projects. “When the public got wind of this agreement, it sounded like another backroom pipeline deal that the public got left out of. That problem can be fixed if there’s more transparency about what’s going on. Whether we like it or not, these mitigation deals are common.”
Both Coy and Michael Kelly, a spokesman for Virginia Attorney General Mark Herring, said the agreement is narrowly focused on mitigating the effects on forested habitat and does not cede any legal authority to pursue damage claims.
“We do not believe that the mitigation agreements limit the ability of the commonwealth to seek damages or enforce natural resource or other laws that might be violated in the development of any pipeline project,” Kelly said.
Coy said other mitigation agreements will cover effects on historic resources and wetlands. The forest mitigation deal, he added, was negotiated pursuant to the final FERC environmental impact statement prepared for the project.
“The mitigation agreement explicitly provides that it is separate and distinct from any other federal and state permitting process,” Coy said.
And the absence of a public announcement isn’t the only objection environmental groups have raised.
The monetary amounts are the same in North Carolina and Virginia, the product of separate negotiations, Ruby says.
“We agreed this was the appropriate amount to address impacts that could not be avoided, specifically those related to forest fragmentation and water quality,” he added. However, the two agreements have key differences.
North Carolina’s agreement says it covers “mitigation for the unavoidable effects of the ACP on the interior forest habitats, open-space lands, water bodies and natural resources of the communities along the ACP’s route,” which includes eight North Carolina counties and about 300 acres of interior forest habitat.
Virginia’s is aimed solely at mitigation for “forest fragmentation effects,” which refers to forest habitat that is degraded beyond the actual acreage cleared by breaking up contiguous areas with roads, utility lines or other development, among other potential detrimental effects.
“The mitigation agreement addresses foreseeable impacts that could not be avoided, specifically those related to forest fragmentation,” said Ruby, the Dominion spokesman. “It does not limit any agency’s ability to enforce the law or the conditions of our permits.”
The North Carolina agreement has specific language staking out that position.
“Nothing in this memorandum shall be construed as precluding or otherwise barring the governor of the state of North Carolina from recovering damages or equitable remedies from Atlantic for spills or leaks stemming from the ACP,” it says.
Virginia’s contains no such provision. Rather, one passage that troubles environmentalists says that about $38.7 million earmarked for forest conservation “fully satisfies any and all mitigation responsibilities related to and otherwise fully offsets the direct or indirect forest-related impacts of the project in Virginia.”
Another, which deals with $19.2 million set aside for water quality, says “such amount fully satisfies any and all mitigation responsibilities related and otherwise fully offsets all water quality impacts caused by forest fragmentation that are not otherwise avoided by Atlantic’s construction methods and environmental protection methods.”
“I would say at a minimum, the waiver provision gives Dominion an enormous opportunity to argue that their damages are capped at $58 million. At a maximum, it’s a clear waiver of future recourse against them,” Sokolow said. “The fundamental point is none of that language was necessary. There’s nothing that would have prevented Virginia from doing precisely what North Carolina did.”
Coy said “no one could reasonably interpret this document as waiving any other rights that bear no relation to this very narrow process.”
Additionally, the Mountain Valley Pipeline mitigation agreement, which also has the “fully satisfies any and all mitigation responsibilities” language, has a section that says the agreement “provides no guaranty, right or entitlement of any kind that the commonwealth ... will grant any or all required permits, certifications, consents, authorizations or other approvals of any kind that may be required.”
The ACP agreement does not.
In December, the State Water Control Board approved water quality certifications for both projects, though it delayed the effective date of the ACP’s certification until the state Department of Environmental Quality has approved outstanding erosion and sediment control plans and presents a report to the board.
Earlier this month, DEQ said it would submit a similar report to the board for the Mountain Valley Pipeline.
“Those were documents that were negotiated between two different companies and two different lawyers on our side. There was nothing nefarious on our part,” Coy said, adding that the MVP language was never included in the ACP agreement. “The way it is stated in the MVP agreement, it is completely gratuitous. It should be self-evident to anybody that these processes bear not at all on permit processes.”
Rick Webb, a retired University of Virginia stream scientist and coordinator with the Dominion Pipeline Monitoring Coalition, a consortium of groups opposed to the project, said the agreement has opened up wiggle room “subject to interpretation” that might not become clear until a problem arises.
“We might not know Dominion’s interpretation until the state holds it liable for damages — if indeed the state does. I have no doubt we will have multiple chances to find out,” Webb said.