Conservation Groups Argue Conflict of Interest in Fracked Gas Pipeline

RICHMOND, VA — Today, 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.

The proposed ACP would run over 600 miles through West Virginia, Virginia, and North Carolina, though leaked audio recently revealed Dominion plans to run it through South Carolina, as well. The pipeline would pose major threats to water quality, public lands, and communities. It would also incentivize dangerous fracking and encourage the use of dirty fuels, rather than clean energy sources like wind and solar.

In response, Sierra Club Beyond Dirty Fuels Campaign Director Kelly Martin released the following statement:

“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.”

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