Fresh off a visit to Washington, D.C. and a visit to PHMSA, we’ve got an op-ed this week over at Vice News in which we wonder why pipelines just keep failing:
It has been five years since the Marshall disaster in Michigan — and also five years since the terrible San Bruno, California pipeline explosion that killed eight people — but federal regulators have done almost nothing to improve the safety of the nation’s existing pipelines. Partly in response to these incidents and others like them, in 2011 Congress passed the Pipeline Safety, Regulatory Certainty, and Job Creation Act. Yet in the intervening time, the agency charged with implementing that bill’s provisions, the Pipeline and Hazardous Materials Administration (PHMSA), has failed to finalize and institute any new major regulations.
You can read the full piece here.
And while you’re there, be sure to take the time to watch the excellent video report, “Pipeline Nation,” featuring our friends Carl Weimer and Alexis Bonogofsky telling the truth.
A History Lesson for Brad Shamla
Looks like Enbridge needs another history lesson. To mark last week’s anniversary of the Marshall spill, Enbridge VP Brad Shamla penned an editorial that was published in the Battle Creek Enquirer and the Detroit News. A version of the op-ed also appeared as a “letter” (that is, a paid advertisement) in the Detroit Free Press (and probably elsewhere, we’re not sure).
It’s a fine-sounding letter, carefully crafted, we’re sure, by a whole committee of people in the vast Enbridge public relations department. The trouble is, it’s also disingenuous, starting with its very first sentence. See if you can spot the problem:
July 26, 2010, is a day that no one at Enbridge will ever forget.
Yep, that’s right: in an article whose central point is memory and commemoration, the importance of always remembering what happened in Marshall, Shamla gets the date of the spill wrong. July 26, 2010 is NOT the day the “Line 6B pipeline failed near Marshall.” As everybody knows, the failure occurred on July 25.
So what gives? Is it possible Shamla doesn’t know this? Is it merely a typographical mistake? Or might it be, once again, a willful distortion of the facts on the part of Enbridge? You won’t be surprised to learn that we think it’s the latter. Shamla (and Enbridge) date the spill on July 26, presumably, because it allows them to forget what happened the day before, when Enbridge ignored evidence of a problem with the line, ignored its own safety protocols, turned up the pressure on the line, and gushed oil out of the ruptured seam in Line 6B for 17 hours. Here’s the National Transportation Safety Board’s account of what happened:
On Sunday, July 25, 2010, at 5:58 p.m., eastern daylight time, a segment of a 30-inch-diameter pipeline (Line 6B), owned and operated by Enbridge Incorporated (Enbridge) ruptured in a wetland in Marshall, Michigan. The rupture occurred during the last stages of a planned shutdown and was not discovered or addressed for over 17 hours. During the time lapse, Enbridge twice pumped additional oil (81 percent of the total release) into Line 6B during two startups; the total release was estimated to be 843,444 gallons of crude oil. The oil saturated the surrounding wetlands and flowed into the Talmadge Creek and the Kalamazoo River. Local residents self-evacuated from their houses, and the environment was negatively affected.
So far from remembering the Marshall spill, Shamla and Enbridge are actually re-writing history in order to conveniently erase some key facts from the historical record– facts that point directly to the real causes of the spill and its severity.
This revisionism is part and parcel with all of the new measures Shamla touts as Enbridge’s response to the lessons they learned from the spill. Mainly, those measures consist of throwing a lot of money around. Don’t get us wrong, some of the measures Shamla describes seem like good things. But not one of them gets at the core of the problem. Not one of them addresses or acknowledges the principle reason (according to the NTSB) the Marshall spill was so very bad: Enbridge’s “culture of deviance” from following its own safety protocols. Prior to the Marshall spill, Enbridge had all the tools it needed to prevent the spill: detection equipment that found anomalies, control center rules that could have shut down the pipe right away. But Enbridge disregarded or ignored those things. Spending money on new equipment, putting in place new rules and protocols isn’t going to matter one little bit if Enbridge doesn’t change its culture. The former is easy; the latter is very difficult– even more difficult if you’re unwilling even to acknowledge the problem.
“We will not forget the Marshall incident,” Shamla tells Michiganders, which may be true. Unfortunately, the incident Enbridge has “memorialized,” the incident Enbridge vows not to forget appears to be a fictionalized version of the incident, only loosely based on actual events.
If you “like” us over on Facebook, you might know that on our annual vacation to Minnesota this year– yes, the one that takes us past the Enbridge offices in Superior, Wisconsin— we were lucky enough to speak to an extraordinary group of citizens embroiled in their own battle with Enbridge. The Friends of the Headwaters up in Park Rapids are concerned (and rightfully so) with the route Enbridge has proposed for its “Sandpiper” pipeline, which would transport crude from the Bakken region of North Dakota all the way to Superior. Along the way, it would pass through some of the most pristine, untrammeled, and beautiful areas in Minnesota– no, in the country– including the headwaters of the Mississippi River. Frankly, unless you’re an oil pipeline executive whose only concern is moving product as quickly and cheaply as possible, the route is totally bonkers.
We’ll have much more to say about Sandpiper and its companion project, the Line 3 “replacement” (both of which we’ve mentioned before), in the weeks and months to come; they’re both a part of the current North American crude and tar sands arms race. At present, the Minnesota Public Utilities Commission (the equivalent of our MPSC) is reviewing Enbridge’s approval request for Sandpiper. And the Friends of the Headwaters, because they are both rational and devoted to Minnesota’s stunning natural resources, are trying to persuade the PUC to reject Enbridge’s route and to protect the magnificent headwaters. The vast majority of informed Minnesotans appear to agree with them. As landowners who have lived through the “Enbridge experience” and as frequent visitors and admirers of Minnesota’s wonderful and fragile waterways, we fully support the work of the Friends.
For that reason, we were particularly thrilled to be invited to speak with them about our own experience. An impressive, curious, and thoughtful crowd of about 75 people showed up to the talk. They were full of energy and commitment, much of that we are sure owing to the example of Friends of the Headwaters President Richard Smith, who is one smart, cool dude (here he is all brilliant and sensible on MSNBC’s “The Ed Show.”) Richard is collaborating with a whole bunch of awesome people, including Deanna Johnson and Barry Babcock, who were kind enough to take us on a fun, informative, gorgeous tour of the headwaters at Itasca State Park on a sweltering day. The company and the scenery were so good that the heat didn’t bother us a bit.
Our talk seemed to be well received; we tried not to go on too long. But the best part was the warm hospitality, the great generosity, and the commitment and enthusiasm of the Friends of the Headwaters. As observers of Enbridge expansion projects in the region, we’ve long admired the work the Friends are doing. Getting to know them in person only deepened that admiration, adding to it real fondness. We can’t thank them enough– for the invitation and for their efforts to protect and preserve Minnesota’s natural resources.
Best of all, their cause appears to be gaining steam, so much so that the PUC actually seems to be listening (at least a little) and Enbridge is doing what it does: lots of misleading p.r.
Energy Transfer just can’t seem to make up its mind.
Less than a year ago, ET was telling everyone, including federal regulators, that they had more pipeline capacity than they needed to serve Michigan– so much capacity, in fact, that they sought permission from the Federal Energy Regulatory Commission (FERC) to abandon one of their natural gas pipelines. Now, not even a year later, they are preparing to ask FERC for the power of eminent domain so that they can install an even bigger pipeline into and through Michigan– and perhaps right through your property. Does that make sense to you?
Let us explain. Back in 2012, Energy Transfer applied to FERC for permission to abandon a 770-mile stretch of their Trunkline pipeline, a 30-in gas line that ran from the Gulf of Mexico to Michigan so that it could be converted to carry crude oil. This application did not please energy companies in Michigan, especially Consumers Energy. So those companies protested, as did Michigan’s elected officials, including Senators Stabenow and Levin. Even Governor Snyder and the Michigan Public Service Commission cried foul. Consumers and others worried that abandoning Trunkline– which delivered as much as 60 percent of the gas used by Consumers– would negatively affect the reliability of the state’s natural gas supply and perhaps drive up costs.
Energy Transfer adamantly (and sort of snidely) dismissed all of those concerns, including– get this– “environmental concerns… about having to build another pipeline in the future if this one is abandoned.” In fact, Energy Transfer even went so far as to cast Consumers and Michigan state officials as a bunch of hysterical Chicken Littles. That’s not a joke: they actually told FERC, in response to these protests, that “the sky is not falling.” They said a lot of over things to FERC as well, all to reassure them that abandoning Trunkline would have no effect on natural gas supplies in Michigan. For instance, they said:
• Trunkline’s natural gas delivery capacity into the state of Michigan will remain the same both before and after the proposed abandonment;
• Sufficient capacity will remain post-abandonment for Trunkline to meet all of its firm contracted-for capacity, thus ensuring continuity of service;
• No shippers will experience any change in service or harm in terms of quality of service;
In addition, Energy Transfer specifically rejected (several times) claims that “Trunkline should be required to hold unneeded capacity in the unlikely event that it may be needed at some speculative and undefined future date.”
Unsurprisingly, ET got its way in this matter. FERC approved their application to abandon Trunkline, making possible its conversion from shipping natural gas to shipping crude oil. And here’s the punch line: which oil transportation company do you suppose took over Trunkline to ship that crude oil. We’ll give you one guess….
Yep, you’re right: Enbridge. So ET gets to abandon a natural gas pipeline, making it possible for Enbridge to use the same pipeline to ship more crude (and make more money), at which point ET turns around and proposes to build a NEW, BIGGER natural gas pipeline so that they can ship more fracked natural gas through Michigan to foreign markets (and also make more money). How’s that for salt in your wound?
But the important point here is this: if ET Rover has its way, FERC will approve this new project (FERC always approves these applications) and grant them a Certificate of Public Convenience and Necessity. That Certificate would give ET Rover the power of eminent domain, which will mean that landowners in Michigan (and elsewhere) will not have any choice in whether or not ET Rover crosses their property. However, those same landowners will be entirely justified in wondering how FERC could possibly think that this project serves the “public necessity” not even a year after agreeing with Energy Transfer that there is no public necessity for increased natural gas capacity into Michigan.
Of course, ET is going to say that this project is just a matter of responding to their customer’s demands– and that may be true. But FERC’s charge is not to give in to every demand of natural gas developers; its charge is to determine “public necessity.” They need to be reminded of that crucial distinction. (We should also mention, because ET certainly will, that Rover is not a direct replacement of Trunkline; the routes are different. However, they serve precisely the same markets.)
So here’s what is important to take away from this:
First, this pipeline is NOT, according to ET’s own admission, a “public necessity.” It is nothing more than a land grab to allow natural gas fracked from Pennsylvania and West Virginia to pass through your property while offering you and your fellow Michigan citizens very little, if any, benefit. That gas is destined primarily for Canada. We’re just a freeway. That’s bad enough. But more importantly, the fact that FERC (and ET) already concede that that there is no need for this project should, on its own (and self-evidently; its weird that we even have to say it), preclude any approval saying there is a public need.
Secondly, Michigan elected officials, including Governor Snyder, need to be reminded of the position they took on Trunkline a year ago. That is, they should still be concerned about the environmental concerns of building a new pipeline– and they should join landowners, vocally, and publicly, in opposing ET Rover, which again, is not a project designed or projected to benefit Michigan and its citizens.
Finally, as much as landowners should make their concerns about and objections to this pipeline known to ET Rover and its representatives– at their open houses and elsewhere– the real pressure here needs to be put on FERC. Like so many other regulatory agencies, they appear to be little more than an arm of industry. However, the people need to remind them– loudly, persistently, forcefully, and repeatedly– that they work for us, the public, not for private interests.
As some of you know, we were fortunate enough to participate in a forum about tar sands oil development in the Great Lakes Region a couple of weeks ago. Organized by our friend, fellow Line 6B landowner, and Notre Dame University professor Patricia Maurice and hosted by the John J. Reilly Center for Science, Technology, and Values.
Patricia and I were joined by MSU’s Steve Hamilton, who has been a consultant on the Kalamazoo River cleanup, and Beth Wallace, who you surely know by now. Each of us presented for 15 or so minutes and then we took questions from a wonderful and wonderfully-engaged audience.
We thought the event was a smashing success. The room was full and the audience interested, each of my fellow panelists was smart, passionate, and informative. We were even able to meet some people face to face whom we’ve only interacted with through the magic of the internet. It was wonderful to put some faces to some names. Our only regret (but not a surprise), no one from Enbridge attended. Still, the forum went so well that we are hoping to reprise it elsewhere in the months to come. Stay tuned.
In the meantime, you can watch the whole thing online, thanks to Prof. Greg Madey for filming and to Notre Dame’s engineering pubs/graphics crew for getting it posted online:
Thanks, finally, as well to all who attended and, especially, for Patricia for her warm hospitality and her hard work bringing everything together.
This week, we’re going to relinquish a little bit of content-control of this blog in order to bring you a new, lengthy series: real stories from real Line 6B landowners. We’re going to let landowners tell you their own stories about their experience with Enbridge in their own words, with as little editorial intrusion from us as possible. But first, we’d like to say a few words in advance just by way of introduction to the series.
One of Enbride’s favorite strategies in the face of criticism has been to pretend that those who have been outspoken are really just a handful of disgruntled, hard-to-please complainers. Either that or all the ruckus is just the predictable rumblings of some easily dismissed “special interest groups.” Over the past year, we’ve seen various iterations of this specious point– from Patrick Daniel, from Larry Springer, from Tom Hodge, and, especially, from Jason Manshum. Not long ago, for instance, Manshum stated that, “the vast majority of landowners we’ve worked with are pleased with negotiations.” Like most things that Manshum says, that statement is almost completely unverifiable, unless Enbridge is sitting on some comprehensive survey of landowner satisfaction that they aren’t sharing, a survey that we and every landowner we know was not invited to participate in (in which case it wouldn’t be comprehensive). Larry Springer’s similarly disingenuous version of the same line a few months before was his statement that “In a minority of cases, Enbridge made several attempts to negotiate in good faith but was forced to resort to the court process.” (Seriously, has Springer spent 10 minutes in Michigan the past year? Does he really have the slightest clue as to what any individual negotiations were really like? Has he ever spoken to a single landowner on the Line 6B route, even when he had the chance? Does he have even the faintest idea as to whether the things he says about landowner relations are actually true?). Anyway, for a long time we’ve thought about how useful it would be to have some actual empirical data on this question of landowner (dis)satisfaction. After all, it is theoretically possible that it would actually prove Enbridge’s point and make us look like precisely the aberrant, tiny minority of complainers Enbridge would prefer to make us out to be. On the other hand, perhaps it would demonstrate just the opposite.
We’ve taken up this discussion before. In fact, you might recall that we even wrote to Manshum himself to ask whether he had any actual data to support his claims of overwhelming landowner satisfaction. But he never replied. You see, despite his misleading title of “senior adviser of community relations,” Manshum is not really in the business of forging relations with the community. His job is really just to toss out pleasing-sounding phrases for the press. Confronted with a real member of the community seeking to have a real discussion about real, substantive matters, Manshum (like the rest of Enbridge’s pre-programmed PR soldiers) ducks and dodges and hides.
Unfortunately, we have neither the time, the expertise, nor the resources to conduct the sort of careful study, controlling for all sorts of variables– what constitutes a “vast” as opposed to a simple majority? what counts as “pleased”? what happens if you exclude landowners who live on large farms or don’t occupy their property at all? what percentage of unhappy landowners is acceptable to Enbridge? — that could be empirically useful here. What we have instead are stories, lots and lots of stories. What’s interesting about them, though, is just how similar they are. We’re willing to accept– and forgive– the occasional “honest mistake,” which is how Enbridge reps like to describe certain incidents (we’ve heard this on multiple occasions). But when the same mistake happens not just a handful of times, but repeatedly, dozens of times… well, then we think you’re no longer dealing with mistakes; you’re dealing with patterns of behavior, standard practices, systemic problems.
So here’s what we did (in, we admit, a totally unscientific manner): we contacted as many landowners along Phase One as we possibly could and we asked them to reflect a little on the past year working with Enbridge. We asked them to be honest and to tell us what they thought and how they felt about their experience, bad, good, or otherwise. We asked them to pass along our call for contributions to their neighbors and others along the route whom we might not know.
Now, you could say– and we imagine Enbridge will say– that the responses we received and will share with you come from a self-selecting group. A bunch of complainers who are drawn to a complaining blog. Maybe that’s true. But we can say with certainty that our sample is far less selective (and much larger!), not to mention far less curated and orchestrated than what you get from the Enbridge marketing department when, say, they trot out “Dr. Michael Milan,” gussy him up in some fancy camo hunting gear, and have him pose for print ad photographs. So, while admittedly, it’s hard to say just how representative the stories we’re bringing you really are, there are enough of them to suggest that this is more than an aberration. And we can say with absolute certainty that you’ll be hearing from real landowners, ordinary people, your neighbors (to use a phrase Enbridge is fond of using)– not just a bunch of people who “are never going to be happy,” not “special interest groups,” not “professional opposition,” not even people who “oppose the pipeline,” and definitely not “revolutionaries.”
Our hope is that by gathering together a collection of these stories as a critical mass, Enbridge will, for once, set aside the defensiveness and the posturing, the denial and the carefully-honed messaging and do what it has thus far been either unwilling or unable to do: take a cold, hard, sober, honest look at itself, at the conduct of its land agents and representatives and its treatment of the fine people of the great state of Michigan, then decide for itself whether they have lived up to its own professed values.
Finally, if you are a landowner and haven’t heard from us or haven’t yet contributed, but would like to. Please send your thoughts and reflections here-– as long or as short as you like; a couple of sentences or a handful of paragraphy. We will happily maintain your anonymity if you prefer; just let us know whether you’d like your name to appear. Either way, we only ask that you specify your location (city, town, or township). We’re glad to respond to any questions as well.
As we mentioned earlier today– and discussed earlier this week— Enbridge has suddenly, inexplicably, decided to woo the press with a bit of pipeline construction stagecraft now that phase two of the Line 6B “replacement” is in full swing. Tom Hodge has been cast in the role of charming leading man– not a bad move, we have to admit. We’ve always found Hodge quite personable and certainly much more credible, straightforward, and responsive than Enbridge’s brood of PR hustlers– though we have also seen, to our disappointment, that Hodge is prone to the occasional Manshumism (that’s our new term for disingenuous or misleading statements; what do you think?).
Anyway, it’s not hard to see why Enbridge puts on these little media shows: they appear to work. Just take a look at two of the reports filed following yesterday’s mid-day matinée: one from Lisa Satayut at MLive (why didn’t they send Ursula Zerilli?) and another from Scott Davis at the Lansing State Journal. As far as we know, neither Davis nor Satayut has written about the Enbridge project before– and it shows. In fact, in order to try and be generous and fair, we’re going to assume that this fact accounts for both articles’ deficiencies. In our view, we think it’s best if reporters know as much as possible about whatever subject it is they’re writing about; we think readers are much better served that way– as we pointed out in our discussion of Tom Hillen’s disastrous TV spot this week. But we also know (though we’re not in the business) that that isn’t how things always work in practice. Satayut and Davis are given assignments and tight deadlines and not enough time to do the sort of homework that’s going to produce genuinely informative journalism. Because of this, the only thing they can do is type up an account of what happens right in front of their eyes. The results are unfortunate.
Davis’s piece reads just like an Enbridge press release. With the exception of very brief mentions of “the July 2010 pipeline spill that polluted the Kalamazoo River near Marshall” and recent protests (“In recent weeks,” Davis writes, the project “has been hampered by environmental protesters who have linked arms or climbed trees to temporarily block the work”), there is almost no context for the story whatsoever, not even an acknowledgment that this is the second phase of a project that has been going on for well over a year, rife with controversy and contention. Instead, Davis just seems sort of hypnotized by the impressiveness of the operation, waxing a bit lyrical, and then more than happy to step aside and let Jason Manshum pretend like everything has been going just swell, like this:
In most cases, the company purchased additional easements from the 2,500 landowners between Stockbridge and Griffith, Ind., offered reimbursements for crop losses and pledged to restore damaged property once the work is done, said Jason Manshum, spokesman for Enbridge.
“We try to listen to the neighbors and their concerns,” Hodge said. “We try to accommodate them.”
While Davis’s article isn’t much different than one of Enbridge’s notorious full page ads (perhaps this one in particular), at least Satayut recognizes, however simplistically, that there’s more to the story than just a bunch of guys with big equipment and a long stretch of steel pipe. She devotes six paragraphs (well, very short paragraphs) to controversy over the project and provides a full paragraph on Marshall. And there are hyperlinks to related articles.
Unfortunately, the article suffers from the same deficiencies we pointed out with regard to Ursula Zerilli’s piece a couple of days ago. What Satayut innocuously calls “differing opinions on the project” are once again reduced to a crude, ill-informed, and simplistic binary that pits safety-minded Enbridge against some felonious protestors climbing into or chaining themselves to the pipe. That’s it. Nothing about the fact that Enbridge has used the power of eminent domain to take dozens and dozens of landowners to court. Nothing about the fact that numerous Michigan citizens intervened in the MPSC’s approval proceedings for the project, a process that was prolonged, contentious, and raised an array of serious concerns that were not mere “opposition” to the project. Nothing about the fact that a grassroots citizen-group made up primarily of landowners along the pipeline route sued Enbridge in county, then federal court. Nothing about the long, complicated, fascinating standoff between Enbridge and Brandon Township, which illustrated vividly Enbridge’s contemptuous attitude toward and treatment of local authority and local ordinances. Nothing about similar skirmishes (though shorter and quieter) with a number of other townships along the route. Nothing about the silence and apathy of Michigan’s state and federal legislators who have turned a blind eye to Enbridge’s ongoing activities in this state, despite what we know about Marshall. Nothing about the NTSB report on the 2010 spill, which is where we learned so much of what we know about what happened in Marshall (and it ain’t pretty). And, perhaps worst of all, nothing whatsoever about the many, many, many landowners who have never opposed the project, but who have nevertheless felt abused, mistreated, bullied, disrespected, misinformed, under-compensated, beaten down and worn out by Enbridge and its land agents.
Now, we understand that a single article can’t do everything and certainly can’t take on all of that. We recognize that there’s only so much a reporter can do with a limited word count, a limited amount of space. We don’t expect Scott Davis and Lisa Satayut to know about or write about everything we just mentioned in one short article. However, it doesn’t seem to us too much to expect that they could have some dim awareness of all of this and write an article that in some way reflects that awareness, an article that is not either just an Enbridge press release masquerading as a news article (the Davis piece) or a news article that (once again) reduces a set of very important and very complicated and long-running set of concerns to a single woman climbing up into a tree one day (the Satayut piece).
In fact, if you don’t think that can be done, let us direct your attention to the report filed today by Mark Brush of Michigan Radio. Their team– including Rebecca Williams and Lindsey Smith– has been outstanding in their coverage for more than a year. And Mark’s report manages to accomplish– in fewer words!– what Davis and Satayut each fail to do: providing readers with some of the complex, varied, and serious issues that Enbridge’s little performance tried to hide backstage. And it’s not just that Brush went to Dave Gallagher’s house (though that’s no small thing). Mark also manages to mention the NTSB report. He points out (shrewdly) that technology isn’t everything when it comes to pipeline safety. And he mentions legitimate, reasonable landowner concerns that are not just a matter of “opposition.” Obviously, there’s a lot more meat that could still be put on those bones. But what Brush accomplishes in such a short piece is excellent.
It’s what you get when you give a story to a reporter who knows a thing or two about the story he’s covering.
Phase Two Proceedings, Part 3.1
In part 3 of our current series on the MPSC, we told you a little about the career background of Theresa Sheets, the Administrative Law Judge appointed to oversee Enbridge’s phase two application. While we think that background is notable– after all, it’s not unlikely that one’s professional experiences might, inevitably, condition the way one thinks about certain matters– we never really set out to dwell on that point. We did, however, set out to dwell on the way (in our view) that Judge Sheets has done Enbridge’s bidding. In fact, we left off that post with this statement:
Enbridge attorneys have labored to limit the scope of the MPSC’s authority so severely as to cripple it– and Judge Sheets has helped them succeed.
Let us explain. If you’ve been paying attention to last week’s news about the MPSC’s approval of phase two, you may have noticed the following statement, found in the MPSC press release announcing the decision:
In approving the company’s application, the MPSC said the pipeline will serve a public need, is designed and routed in a reasonable manner, and meets or exceeds current safety and engineering standards.
Now these three simple criteria– presumably the basis upon which the MPSC made its decision– might at first glance appear to be benign and even reasonable. But the scary fact is that they are anything but benign. This framework has been, in the hands of Enbridge attorneys, a cudgel– a cudgel with which Enbridge has beaten the MPSC, Judge Sheets, and Michigan law into submission.
You see, the MPSC’s regulatory authority derives from a 1929 Michigan law known as Act 16 (we discussed this briefly in part one of this series, but regret that we were a little imprecise on this point at the time). This act describes the powers granted to the MPSC:
There is hereby granted to and vested in the Michigan public utilities commission, hereinafter styled the “commission,” the power to control, investigate and regulate every corporation, association or person, now or hereafter exercising or claiming the right to carry or transport crude oil or petroleum, or any of the products thereof, by or through pipe line or lines, for hire, compensation or otherwise, or now or hereafter exercising or claiming the right to engage in the business of piping, transporting or storing crude oil or petroleum, or any of the products thereof, or now or hereafter engaging in the business of buying, selling or dealing in crude oil or petroleum within the limits of this state…
It also grants the MPSC the power to define its own rules:
The commission is hereby authorized and empowered to make all rules, regulations, and orders, necessary to give effect to and enforce the provisions of this act.
Now, you will notice two things about these two sections of the act (for the record, they are sections 483.3 and 483.8): first, the MPSC is given pretty broad authority; they have the power to “control, investigate, and regulate” and can “make all rules, regulations, and orders” necessary to enforce the law. Secondly, you will notice that the three criteria stated in the MPSC press release are nowhere stated in Act 16 itself. Certainly, Act 16 does NOT limit the MPSC’s power to just those three items.
Why does this matter? Well, if you read through the MPSC filings, you will nevertheless see this three-part framework– public need, reasonable routing, and meeting current safety standards– again and again and again. In fact, Enbridge attorneys used this framework, successfully, to prevent all kinds of evidence and arguments from entering into the proceedings. They argued that these three things– and nothing else– are what the MPSC is charged with determining. Everything else, Enbridge argued, is “outside the scope of these proceedings.”
So where did they get this framework? It actually comes from a 2002 MPSC ruling in another pipeline application, the infamous Wolverine Pipe Line case (U-13225), which we’ve discussed before in a different context. This is what the Commission said in their order approving the Wolverine application:
Pursuant to 1929 PA 16, MCL 483.1 et seq., (Act 16) the Commission is granted the authority to control and regulate oil and petroleum pipelines. Act 16 provides the Commission with broad jurisdiction to approve the construction, maintenance, operation, and routing of pipelines delivering liquid petroleum products for public use. Generally, the Commission will grant an application pursuant to Act 16 when it finds that the applicant has demonstrated a public need for the proposed pipeline and that the proposed pipeline is designed and routed in a reasonable manner, which meets or exceeds current safety and engineering standards.
What happened is that Enbridge’s clever attorneys seized upon the last part of this statement (everything following “Generally”) and treated it as if it were clear, prescriptive, restrictive, binding law. They first floated this strategy– we haven’t been able to find such a claim in ANY case before the Commission prior to this– in an initial brief in December of 2011, during the phase one proceedings. There, Enbridge stated that:
In considering an Act 16 application, the Commission examines whether there is a need for the project and if the proposed pipeline is designed and routed in a reasonable manner, which meets or exceeds current safety and engineering standards.
And then, in a clever sleight of hand, they went on to cite the Wolverine language. They did NOT cite, it is crucial to note, anything from Act 16 itself. Rather, they simply presented the statement by the Commission in 2002 as if it were a statement defining and delimiting the Commission’s powers per se (as opposed to a statement that just sketches a rough set of guidelines).
But it is plainly not the case that this statement defines and delimits the Commission’s power or authority. For one thing, the Commission’s 2002 statement says that those three things are “generally” what they will consider. It does not say “exclusively” or “solely” or “only.” For another thing, Enbridge glosses over the earlier part of the statement, which mentions the Commission’s “broad jurisdiction.” And finally (to repeat) Act 16 itself absolutely does NOT limit the Commission to these three areas; there is no legal reason why the 2013 Commission in a completely different case should be bound or constrained by the rough– the GENERAL guidelines– set forth by the commissioners in an order in 2002.
Of course, none of this is particularly surprising or bothersome; it’s just crafty lawyers doing what crafty lawyers do. What’s bothersome is that ALJ Theresa Sheets, in an extraordinary display of credulity, swallowed this argument whole. In a Notice of Proposal for Decision filed in March of 2012 (in phase one), Judge Sheets reiterated Enbridge’s argument, citing the same statement from the Wolverine case. In fact, Sheets did Enbridge one better: first, she stated that in the 2002 case the MPSC “articulated the standard for approval of Act 16 applications.” Secondly, as if that way of putting it still weren’t restrictive enough, she then quotes the same language from the ruling– but leaves out the crucial word “generally.” Frankly, in such a carefully written document, this omission, in our view, can only be deliberate– designed further to give the 2002 MPSC statement binding authority. And indeed, Judge Sheets then goes on to use those three criteria as the test– the ONLY test– for approval of Enbridge’s application.
So, having convinced Judge Sheets of this narrow “standard” in phase one , Enbridge had no trouble returning to it repeatedly– and successfully– in phase two to prevent the intervenors from making their case. The question of local consent? Doesn’t fall under one of those three standards, so it’s outside the scope of the proceedings. The NTSB report? Doesn’t fall under one of those three standards, so it’s outside the scope of the proceedings. And so on. Of course, this narrow three-part standard is betrayed by all sorts of other things that were discussed in the proceedings, such as the matter of environmental impacts. Enbridge even had an expert witness who testified about environmental matters– a fact that just goes to show that the Commission DOES and SHOULD consider things other than standards articulated in the Wolverine case. The standard is really just in place when it serves Enbridge’s interest to invoke it.
More importantly, the insistence on a strict adherence to this standard– an adherence enforced by Judge Sheets– hamstrung everybody and prevented a complete and thorough hearing of the case– precisely what Enbridge wanted. And the worst part is that now that the standard has been invoked and endorsed (by Judge Sheets) and repeated and reiterated (in the MPSC press release, in news articles), it will surely take on even greater weight and authority; it will surely be cited in future cases before the MPSC and treated as settled law (even though it is not).
And in this way, Enbridge– a foreign corporation, mind you– has not only gotten its way in this particular case; it has also effectively rewritten Michigan law.