As you probably know if you follow the Mariner East news, a few days ago the PUC approved the settlement between the PUC’s Bureau of Investigation and Enforcement (BI&E) and Sunoco, concerning a 2017 leak on the Dragonpipe (ME1 specifically) near Morgantown. The settlement (apart from the trivial $200,000 fine) has received cautiously positive marks from pipeline opponents, but I have to say I’m disappointed. It gives Sunoco far too much wiggle room, and the company has shown it will take advantage of anything it can get.
A little background on the Morgantown leak. Back in April 2017, a landowner near Morgantown noticed something bubbling out of the ground on his property. It turned out this was due to ethane and/or propane leaking from ME1. The PUC launched an investigation. It took a while but in December 2018, investigators from the PUC’s Bureau of Investigation and Enforcement (BI&E, a quasi-independent department) concluded that the leak was due to the pipe having corroded all the way through, and that Sunoco had failed to follow its own maintenance procedures designed to prevent exactly this result. (For details, see “Sunoco sat by while ME1 rusted” and the links in that post.)
The BI&E also raised the concern that, if it happened near Morgantown, it could be happening all across the state. In December 2018, the BI&E filed these conclusions in the form of a formal complaint with the PUC itself.
That was in 2018. ME1 is still carrying highly volatile liquefied gases across Pennsylvania today, and we still don’t know where the other corroded spots are and where else it could leak (or where it is leaking right now).
Note that everything in this post relates only to ME1. The other Dragonpipes are unaffected.
In its complaint, the BI&E had five basic requests. They wanted Sunoco to be required to:
- Conduct a “remaining life study” on ME1 and propose a “retirement date” for it
- Increase the frequency of in-line (“pig”) inspections to a minimum of once a year “on all bare steel and poorly coated pipelines”
- Revise corrosion control procedures to meet federal guidelines
- Develop procedures to “determine the adequacy of cathodic protection” (the technology involving a small electric current that is supposed to keep corrosion from occurring)
- Implement the new and revised procedures within one year. “If the results indicate [possible corrosion, then Sunoco] shall replace the impacted sections” of the pipeline.
The first settlement. By April of 2019, Sunoco and the BI&E had worked out a compromise, which they presented to the PUC as a possible settlement, to avoid going through a formal (and public) hearing process. It was a disappointment. Two of the most important elements in the original list were missing:
Sunoco no longer needed to propose a “retirement date” for the pipeline, and Sunoco could decide on its own whether any “impacted” (corroded) areas of the pipeline would be replaced.
This is also where the ludicrously low $200,000 fine was agreed to. There were, however, specifics about what types of inspections should occur, and how often.
If you want the details, they are here: The BI&E compromise with Sunoco: on balance, it’s not a good deal.
That initial settlement sure looked like a done deal, but it wasn’t.
Surprisingly (and I wish I knew how this came about) in May 2019 the full PUC voted to reject the settlement. It was unanimous, 5-0. Commissioner John Coleman’s motion to reject the settlement mentioned three specific issues that needed addressing:
- Were any state or federal laws violated?
- Why weren’t intervenors given a chance to provide input?
- Why was a formal document (that had been filed opposing the settlement) never given a hearing?
So Administrative Law Judge Elizabeth Barnes was tasked with coming up with a revision, acceptable to both parties, that answered at least those questions. Which brings us to the current settlement, announced on February 27, 2020. You can read it in full here.
Is this better than the previous settlement? I’d have to say that the improvement is negligible. There is still no retirement date, and it is still completely up to Sunoco to determine when a stretch of pipeline needs replacement. Sunoco is required to file annual reports about the results of its pipeline testing, but the public will never see them.
Judge Barnes did review input from the intervening parties (which is one good thing coming out of the process). The intervening parties included West Goshen Township, the Flynn/Safety 7 intervenors, and West Whiteland Township, as well as the “joint petitioners” (Sunoco and BI&E, the parties to the settlement). Their arguments are laid out at the back of her decision. If you are interested in her major findings, I have summarized them at the bottom of this document. On the whole, they did not significantly change the settlement, and it was approved by the five Commissioners.
One of the five, Andrew Place, filed a mild dissent, saying that making only a “summary” of the annual “remaining life study” public was insufficient. Instead, he wanted a redacted version of the full study. He wrote, “I believe that a redacted version of the expert’s full report findings would provide more transparency and additional information about the remaining life of ME1.” I agree with him on that, but his proposal did not make it into the final agreement.
In one respect, this agreement is much weaker than its predecessor. In an Addendum, jointly filed by BI&E and Sunoco in June 2019, both BI&E and Sunoco reserve the right to totally withdraw from the settlement if PUC makes a decision affecting it. A footnote contains the following language: “For instance, if the Administrative Law Judge made a ruling that modified the Settlement, the parties may elect to withdraw then or elect to withdraw within 20 days of the Commission’s final ruling upon review of the A L J’s proposed modification.” As I read it, if Sunoco’s lawyers can find something they don’t like in one of Judge Barnes’ rulings (for example, in the Safety 7 case), or some other PUC ruling, they can claim the ruling violates this settlement in some way, and simply stop complying.
That one sentence renders the whole document fragile, or so it seems to me. I’m not a fan.
Judge Barnes’ major findings
Here is a summary of Barne’s findings and some of her reasoning. Refer to the full text of her decision for full detail.
$200,000 is enough. In spite of strong arguments for raising the fine, Barnes decided that it was sufficient. Her reasons included that there were no serious consequences from the leak, and that Sunoco has made modifications to its procedures to prevent recurrence. She agreed that Sunoco has a history of non-compliance with regulations, but was not persuaded that an increased fine was required as a consequence. So she left the amount intact.
Remaining life study. The intervenors criticized the annual “remaining life study” (RLS) on several fronts. According to the settlement, the RLS is to be confidential, with only a “summary” available to the public. Might that “summary” just amount to a press release? Moreover, the RLS is to be conducted by an “independent expert”, chosen from among three names submitted by Sunoco. How “independent” is a person selected via that process likely to be? Under the settlement, Sunoco doesn’t have to make anything public that is “proprietary” or “confidential security information” (CSI). But in the past, Sunoco has used these as excuses to hold vast portions of documents from the public.
Judge Barnes acknowledged the legitimate need for townships and school districts to have enough information to create emergency plans, while also recognizing the need to keep real CSI away from terrorists and competing companies. But under current regulations, the only way that abuse of the CSI designation can be addressed is by the PUC notifying the “utility” of a challenge alleging misuse of CSI. There is a PUC procedure by which a township or school district could file such a challenge. Will they?
Barnes did suggest that anything that is received by both BI&E and Sunoco from the “independent expert” should be a potential candidate for sharing with people who have a non-disclosure with Sunoco. (That would include Richard Kuprewicz of Accufacts, who is retained as an expert for West Goshen Township.) This type of disclosure is just a recommendation and not an obligation on Sunoco. She also “encourages” Sunoco to share the annual RLS reports in full and under non-disclosure, with townships. How likely is it that Sunoco will do this?
Revision of procedures and pipeline replacement. Judge Barnes found that the changes in procedures made by Sunoco since the initial complaint are sufficient. (I refer you back to the post on that complaint for the details.) To me, the key problem is that Sunoco alone determines what pipeline is corroded enough to need replacement. Can we trust the company to do that prudently? Every time they shut the line down to replace pipe, they lose money. To depend on a company that seems to care only about money to make the right decisions on safety seems to me like asking for trouble.