Category Archives: Conflicts of Interest

Dominion’s Ties to Decision-makers

On Eve of Key Atlantic Coast Pipeline Decision, Here’s a Review of Dominion’s Ties to Decision-makers – an article published by DeSmog on December 5, 2017.

Ahead of the key meetings of the Virginia Water Control Board, “DeSmog is taking a look back at the many instances where the federal and state regulatory review processes for this pipeline were either potentially conflicted by Dominion’s involvement or somehow linked to the company.” Their article considers these facts:

  • Regulator Represented Dominion in Past: “The newest member of Virginia’s Water Control Board has past links to Dominion. Board member Timothy Hayes, appointed by Governor Terry McAuliffe this past August, is a retired lobbyist and attorney who previously represented the energy company.”
  • Government Contractors Also Working for Dominion: “In April, DeSmog revealed that a third-party contractor reviewing the Atlantic Coast pipeline on behalf of FERC is tied to Dominion’s main environmental contractor on the project.” Also, “Soon after, DeSmog reported that another third-party contractor, this time hired by the U.S. Forest Service to review a portion of the pipeline running through national forests, was working at the same time for Dominion on the very same project.” And again, “In June DeSmog revealed that a contractor, hired by the Virginia DEQ to independently review the adequacy of Dominion’s stormwater and erosion and sediment control plans, was working at the same time for Dominion on an unrelated project.”
  • Dominion and Politicians: “Multiple reports from the last year have uncovered the ongoing political connections between Dominion, a traditionally powerful corporate player in Virginian politics, and top political players in both major parties.”

The Gas Industry’s Playbook

The December 5, 2017, Huffington Post reports that a Leaked PowerPoint Reveals The Gas Industry’s Playbook For Waging Pipeline Fights. Earlier revelations in the November 29, 2017, Washington Post on Dominion’s ‘Campaign to elect a pipeline:’ Va.’s most powerful company ran multi-front fight, said, “The state’s most powerful corporation, along with partner companies and the American Gas Association, poured resources into online groups called EnergySure and Your Energy Virginia to whip up what it called a grassroots ‘campaign to elect a pipeline.’ Numbers from an industry presentation suggest the scope of the effort: As of early October, Dominion had compiled a ‘supporter database’ of more than 23,000 names, generated 150 letters to the editor, sent more than 9,000 cards and letters to federal regulators and local elected officials, and directed more than 11,000 calls to outgoing Gov. Terry McAuliffe and Virginia’s U.S. senators.”  The Post also posted Dominion Energy’s Power Point to industry insiders detailing its campaign to build support for its controversial pipeline. See Dominion’s 10-slide PowerPoint here.

The new Huffington Post article builds on the Washington Post’s November 29 article about the role of manufactured pro-energy front groups like Energy Sure and Your Energy Virginia, and includes additional examples of their promotional materials. For the gas industry, “it’s like, ‘We have to do something, we have to counter this narrative, or at least we have to muddy the waters and make it seem like there’s protests on both sides,’ said Josh Stanfield, executive director of the progressive group Activate Virginia, which has opposed pipelines.”

Can We Trust the VA State Water Control Board?

In the coming two weeks the Virginia State Water Control Board will hold hearings (agendas here) on both the proposed Atlantic Coast and Mountain Valley Pipelines. A November 29, 2017 article in Blue Virginia says, “One would think that because the SWCB’s function is to make independent decisions on Virginia water quality, the SWCB and Dominion wouldn’t have any connection outside of ‘independent’ decisions made by the SWCB involving Dominion projects. But upon taking a closer look at individual members of the SWCB, a stunning and disconcerting number of ties between board members and Dominion can be found.”

Can we trust the SWCB to make truly independent decisions?

“Campaign to Elect a Pipeline”

On November 28, 2017, the Washington Post reported on Dominion’s “Campaign to elect a pipeline:” Va.’s most powerful company ran multi-front fight.

“Dominion Energy was taking no chances with the fate of its proposed natural gas pipeline during this year’s election season, even though both major candidates for governor supported the $5 billion project. The state’s most powerful corporation, along with partner companies and the American Gas Association, poured resources into online groups called EnergySure and Your Energy Virginia to whip up what it called a grassroots ‘campaign to elect a pipeline.’ Numbers from an industry presentation suggest the scope of the effort: As of early October, Dominion had compiled a ‘supporter database’ of more than 23,000 names, generated 150 letters to the editor, sent more than 9,000 cards and letters to federal regulators and local elected officials, and directed more than 11,000 calls to outgoing Gov. Terry McAuliffe and Virginia’s U.S. senators.”

Poor Dominion. They’ve had to work so hard to overcome the noise created by what they think is a “fragmented group of environmentalists and landowners from some of the most remote parts of the state,” trying  “to get attention for their (anti-pipeline) concerns”. They’ve had to deal with folks like us using “‘outrage and intimidation’ as ‘common tools’ to try to delegitimize the (approval) process.”

Never mind that what Dominion tries to portray as a merely a pesky “fragmented group” from “remote parts of the state” includes many individuals, many local, regional and national groups – as well as duly elected officials.

Dominion is worried about what might happen when citizens express their concerns and beliefs, worried that, “Nowadays [regulators] are being bombarded by general citizenry, by elected officials who have asked to insert themselves into the process, and this debate swirls around.” Funny thing – we thought people being involved with issues of concern to them was a good thing, part of the democratic process.

We always knew that the American Gas Association was involved in the whole Energy Sure blitz; Dominion actually created it. “Dominion established EnergySure in 2015, and uses a mix of internal staff and outside consultants to maintain it. The company would not disclose how much money it puts into the effort.”

Read the Washington post article here.  The Washington Post also has posted Dominion Energy’s Power Point to industry insiders detailing its campaign to build support for its controversial pipeline. See Dominion’s 10-slide PowerPoint here.

Then read Blue Virginia’s 11-28-17 commentary on the Post article, Dominion Spends “Captured” Virginia Ratepayer Money to Push Its Propaganda, Disparage Pipeline Opponents and the Media.

Conservation Groups Argue Dominion Conflict of Interest

On October 12, 2017, attorneys for the Sierra Club and Appalachian Mountain Advocates (Appalmad) filed an appeal to the Virginia Supreme Court to ensure that a deal for fracked gas shipping capacity is reviewed for conflicts of interest. The Atlantic Coast Pipeline (ACP) presents a major conflict of interest because the companies that own the pipeline, including Dominion Energy, also own the utilities that have purchased shipping capacity on the pipeline. These arrangements between corporate affiliates encourage their parent companies to build unnecessary infrastructure – like the ACP – that would likely not be built if those companies had to rely on independent purchasers. As a result of this inter-affiliate agreement, Dominion stands to reap major profits on the ACP, which will be paid for by its customers through increased electricity bills. The Sierra Club and Oil Change International recently released The Art of the Self-Deal, a report detailing how these arrangements work. Virginia’s Affiliates Act requires the State Corporation Commission to review agreements like these.

Sierra Club’s Beyond Dirty Fuels Campaign Director Kelly Martin said, “The fracked gas Atlantic Coast Pipeline is not only dirty and dangerous, it’s also expensive and unnecessary: Dominion is making a deal with itself for pipeline capacity to justify building a project we just don’t need. Fortunately, Virginia passed the Affiliates Act for exactly this type of situation. The State Corporation Commission must, under that law, review Dominion’s inter-affiliate agreement before it can take effect and determine whether or not it is in the public interest. This review process is not optional, so we’re taking this case to the Virginia Supreme Court.”

Broken Regulatory System

In her September 26, 2017, post in Power to the People, Ivy Main writes about the proposed Atlantic Coast Pipeline as part of a widespread, systemic market failure. “Anyone who examines the corporate deals that underlie the Atlantic Coast Pipeline comes away with a strong sense of looking at a broken regulatory system. The Federal Energy Regulatory Commission (FERC) is supposed to approve only those pipelines that can demonstrate they are actually needed. Pipeline companies demonstrate need by showing that customers have contracted for most or all of the pipeline’s capacity. In the case of the ACP, Dominion Energy and its partners manufactured the need by making their own affiliates the customers of the pipeline.”

The article goes on to discuss the new report, Art of the Self-Deal, from Oil Change International that shows “the U.S. is currently building unneeded fracked-gas pipelines as a result of FERC’s regulatory failures, including its failure to police self-dealing. The result will be excess pipeline capacity, paid for by regulated utility customers.”

The article also discusses the Virginia State Corporation Commission (SCC) acceptance of self-dealing. “The Sierra Club petitioned the SCC to require Dominion to comply with the Affiliates Act by disclosing the affiliate relationship and seeking approval of the arrangement that affects captive customers. Without SCC approval, Dominion would seem to be on thin ice telling FERC it has the contracts in place that demonstrate the ‘need’ for the ACP. One would have thought the SCC would jump at the chance to weigh in. The FERC filings show it will cost ratepayers three to four times more to use the ACP than to stick with the competing pipeline that Dominion already has long-tem contracts with. But on September 19, the SCC denied the Sierra Club’s petition. One of the reasons cited was that Dominion will have to get SCC approval before it actually charges ratepayers for any gas carried by the pipeline. Meaning, the SCC says it will consider the merits of the problem only after Dominion has secured FERC approval, and after the ACP has already ripped a 600-mile gash across the countryside, dispossessing landowners, tearing up forests, and endangering streams and water supplies.”