Pipe Dreams

A new study, Atlantic Coast Pipeline:  Economics and Manufacturing Jobs, by the Applied Economics Clinic at Tufts University, looks at repeated claims by project proponents that new interstate natural gas pipelines like the Atlantic Coast Pipeline (ACP) or Mountain Valley Pipeline (MVP) will: (1) save consumers money relative to alternative energy sources; and (2) lead to new manufacturing jobs.

Bottom line: The claims are all hype.

The study was commissioned by the Natural Resources Defense Council and, following its December 5, 2017, release, was analyzed on both the NRDC Web page and by Blue Virginia.

The key findings of the independent study demolish all Dominions claims about economic development and new jobs:

  • The ACP will cost rather than save money for customers: “Dominion claims that the ACP will save consumers money by supplying the region’s power producers with shale gas, even accounting for the additional cost to transport the gas from farther away…In fact, testimony using Dominion’s own, more recent cost projections concludes that Dominion’s customers may actually pay $1.61 to $2.36 billion more with the ACP than without the ACP over the next 20 years.”
  • There is no need or demand: “Dominion and its pipeline partner Duke Energy (Duke Energy Carolinas and Duke Energy Progress) have lowered forecasted demand by 15,468 GWh in 2025 since the ICF report was released. This reduction in future energy load reflects a reduced need for new natural gas combined cycle generating capacity, and a corresponding reduction in demand for natural gas…. These lower utility demand forecasts would eliminate the need for a large amount of new natural gas generating capacity and avoid 375 million cubic feet per day of natural gas delivery.”
  • Pipeline-induced job growth is a myth: “Recent evidence from states with new natural gas pipeline capacity shows no support for the conclusion that the addition of new pipelines leads to additional opportunities for new manufacturing jobs in those states. There is no clear support for the claim that the ACP would lead to additional opportunities for new manufacturing in the region, and this is likely the case for other new natural gas pipelines such as the Mountain Valley Pipeline.”
  • It’s even possible we’ll LOSE manufacturing jobs with the ACP. “Seven states with additional pipeline capacity saw both falling electricity prices and losses to manufacturing jobs, including Virginia, one of the states in which the ACP and MVP would deliver natural gas. West Virginia—a major natural gas producer and the origin for a number of new natural gas pipelines including the ACP and MVP—has experienced increased electricity prices coupled with losses in manufacturing jobs in the state.”  [See the recent opinion column by Tom Perriello and Alex Laskey discussing the ways Virginia lags behind our neighbors when it comes to advanced energy, a sector that supports 3.3 million American jobs, while the job growth in energy efficiency and clean energy is projected to outgrow the rest of the economy several times over.