Concerns With Prefiled Bill That Would Broaden NGL Pipeline Condemnation Power Posted: September 16, 2013
Dear Representative Tilley:
Two press contacts have asked for my thoughts on your bill request (BR 168), and I wanted to first touch base with you before speaking to the press.
I appreciate your interest in extending some degree of public oversight over these hazardous material pipelines, yet, for a number of reasons, cannot support the bill as drafted. These are my concerns:
a. The Public Service Commission jurisdiction extends to regulated public utilities, and these interstate pipelines are not regulated utilities. The Commission is being asked to grant or withhold the power of condemnation, which is a legislative and constitutional function and should not be delegated to the Executive Branch.
b. The criteria and process for PSC review are much less robust than would be accorded to a natural gas pipeline by the Federal Energy Regulatory Commission, and do not appear to require a full quasi-adjudicative hearing as would be provided in a Certificate of Need and Public Convenience case, including the right of formal intervention, cross-examination of witnesses, and discovery.
c. The review criteria are unrelated to the decision to allow or disallow condemnation powers. The Commission is being tasked with balancing the promotion of infrastructure against public safety and environmental protection in deciding not whether to allow the project at all (as would be the case in a siting board or Certificate of Need process), but whether to grant the power of condemnation to a private, non-utility for a pipeline project. The bill in effect "trades" some level of review (but no authority to prevent the project even if it isn't found to be in the public interest) for a broad grant of condemnation powers to interstate pipelines carrying natural gas liquids, that they currently do not have under state law. I don't believe that the extension of condemnation powers to non-utility, private companies, whether they are common carriers or not, is in the best interests of Kentucky landowners.
I would encourage you to de-couple these issues, so that the question of whether to expand the power of condemnation to these non-utility parties can be debated on its merits. Nothing in current law prevents the construction of such a pipeline on a willing seller basis. Landowners should not have to trade the right to say "no" for a modicum of oversight of pipeline routing.
Thanks for your consideration of these concerns.