AES moves to halt LNG project at Sparrows Point
Wednesday, 02 October 2013 11:53

Sept. 19 filing seeks to vacate FERC approval

by Nicole Rodman

    On Sept. 19, Virginia-based AES Corp. filed a motion with the Federal Energy Regulatory Commission (FERC) to vacate its previous approval of a liquid natural gas (LNG) plant on the Sparrows Point peninsula.
    “AES has decided to no longer pursue constructing the LNG terminal and the associated 88-mile natural gas pipeline authorized by the Commission,” the motion stated. “To date, no construction activities have been undertaken, and thus there are no facilities in service.”
    In the motion, AES requested that FREC’s previous authorization be vacated by Sept. 30.
    AES first announced plans to build a LNG terminal at Sparrows Point in January 2006.
    The plan called for the building of three large storage tanks, a facility to unload LNG tankers and an 88-mile long pipeline that would carry natural gas from Sparrows Point to Eagle, Pa.

Opposition to the plan was immediate, as residents, politicians and the local and state government all rejected the plan.
    In reaction to the AES plan, the Maryland General Assembly formed the Baltimore County LNG Task Force, a 14-member committee assembled to study the plan and offer recommendations.
    In its final report, the task force asserted that such a plant should be built at least two-and-a-half miles from residential areas, noting that an explosion could affect homes up to 2.56 miles away from the plant.
    The facility at Sparrows Point would have been a mile away from residential areas.
    Other concerns raised in reaction to the AES plan revolved around the company’s plan to dredge around the Sparrows Point peninsula in order to make room for LNG tankers.
    Opponents feared that dredging in the area could stir up toxins in the sediment and damage local waterways.
    Residents and political leaders also voiced fears that a LNG terminal would be a target for terrorists and that the highly flammable liquid natural gas would pose a danger to the community.
    At a public meeting in February 2006, AES Sparrows Point managing director Aaron Sampson addressed many of those concerns.
    In response to outcry over potential dredging, Sampson noted that environmental tests were being done and that no decision had been made on dredging.
    Regarding questions about potential terrorism Sampson explained, “When there is no residential area in a one-mile radius of the [proposed plant] terrorists tend to exclude you as a target.”
    Though he downplayed the threat of a terrorist attack, Sampson did note that all LNG ships would be escorted by the Coast Guard.
    Former presidential counterterrorism advisor Richard Clarke was later contracted by AES to evaluate the risk of a terrorist attack at a potential Sparrows Point LNG facility; in a 2007 interview with The Eagle, Clarke characterized the likelihood of an attack at Sparrows Point as “remote.”
    Regardless of opposition, in January 2007 AES filed a motion with FERC requesting a certificate to build a LNG facility at Sparrows Point.
    In February 2007, the Maryland Department of Natural Resources submitted a report to FERC raising safety concerns and asserting that the plant would pose a risk to the surrounding community.
    In addition, Gov. Martin O’Malley also wrote a letter to FERC requesting that the certificate be denied.
    Many other political leaders spoke out against the project, including State Sen. Norman Stone, then-Baltimore County Executive Jim Smith, U.S. Representative Dutch Ruppersberger and U.S. Sen. Barbara Mikulski.
    For their part, local residents organized the LNG Opposition Team in an effort to stop the project from moving forward.
    Despite the outcry against the project, in January 2009, FERC approved AES’s request for a certificate.
    While the AES plan was approved, FERC chairman Jon Wellinghoff himself voted against the project, questioning the need for a LNG facility in the region.
    Despite FERC’s approval for the project, AES was unable to secure the necessary air and water quality permits needed to continue.
    The Maryland Department of the Environment denied AES a water quality certification due to unanwered questions regarding the project’s potential impact on waterways.
    MDE’s decision was later upheld in court.
    The state of Maryland, Baltimore County and the LNG Opposition Team filed appeals to the FERC decision, attempting to block the LNG project from going ahead.
    Since FERC’s decision to issue a certificate to AES in 2009, the company has spent years in court battling efforts to shut the project down.
    On Sept. 19, it was AES itself that halted the project, filing a motion to vacate the authorization and certificate for the LNG project.
    According to Russell Donnelly, leader of the LNG Opposition Team, AES’s decision to abandon the LNG project came as a surprise.
    “It was pretty quick,” Donnelly said, noting that the battle ended “sooner than I would have expected” given the fact that AES is one of the largest power companies in the world.
    “The little guy did win,” Donnelly said.
    Donnelly was quick to note that the victory was a group effort, acknowledging many on the team, including attorney Bart Fisher, who represented the LNG Opposition Team pro bono.
    While AES’s motion has been filed, nothing is official until FERC rules on the motion.
    Repeated attempts to contact AES regarding the Sept. 19 FERC motion were unsuccessful as of press time.