December 2021, Vol. 248, No. 12

Editor's Notebook

A True Chilling Effect

By Michael Reed, Editor-in-Chief

When the U.S. Supreme Court refused to stay a lower court decision that vacated a federal permit allowing Spire’s STL pipeline to operate, it opened a door that could threaten natural gas supplies to residents during St. Louis’ notoriously bitter winter.  

Spire had warned that the specter of a shutdown of the 65-mile (105-km) pipeline might result in gas outages for as many as 400,000 in the city. Although, as of press deadline, the pipeline continued to operate through an emergency certificate issued by the Federal Energy Regulatory Commission (FERC) under the Natural Gas Act.  

The pipeline, which transports natural gas from Scott County, Illinois, north of the city, to the storage facility in north St. Louis County, began operating in November 2019. It is designed to deliver as much as 400 MMcf/d (11.3 MMcm/d) of gas.   

While the decision by the U.S. Court of Appeals for the D.C. Circuit had been predicted by many analysts, and its effect has been delayed at least temporarily, the potential effect of such retroactive actions concerning pipeline permitting remains, not only for Spire customers but elsewhere.   

“The reality is if the STL Pipeline is not in service this upcoming winter, Spire Missouri may not be able to meet customer demand, and customers could unexpectedly see their heat and hot water unavailable when they need it most,” said Scott Carter, president of Spire Missouri.  

As any of our many Texas readers know from their firsthand experiences of last winter, such a situation can spell disaster, particularly among senior citizens and those with existing health issues. The burden would also fall disproportionately on people with limited incomes and other resources.  

In fact, while both Texas and Oklahoma dealt with dangerous winter outages during Winter Storm Uri, the St. Louis area avoided this hardship and the related cost increases for supplies, in large part because of the STL Pipeline.   

“At a time when millions of Americans are still struggling to make ends meet because of the pandemic, many in our community simply cannot afford another shock to their budgets,” Michael P. McMillan, president and CEO of the St. Louis Urban League, wrote recently of the higher court’s inaction.   

The permanent – or so it was thought to be at the time – certificate to operate the STL Pipeline was issued in 2018. In its decision to vacate the certificate, the court chose to look beyond the benefit the pipeline had provided to the community it serves, instead concentrating on the fact that only one gas supplier was committed to using it – in this case, an affiliate of the line’s operator.   

While Spire STL and Spire Missouri, which are affiliates, did enter into a contract for 87.5% of the pipeline’s capacity, raising suspicions that the pipeline was built to give Spire an unfair competitive advantage rather than diversifying the  St. Louis market, the rationale here seems flawed.  

One would think that the ongoing safety of the community would come first on this or any other list of priorities.  

The temporary permit will keep the pipeline in operation through mid-December, while FERC further reviews the court order. It is important to note that St. Louis could face a good two months or more of potential freezing weather beyond that point.   

In its request to FERC, the Missouri Public Service Commission, which studied the possibility of outages and sided with Spire, sought expedited action on the case.   

“Spire Missouri’s customers include individuals and businesses that depend on continuous natural gas service for heat, cooking and commercial activity,” the commission said in filings. “Caught in a situation not of their own making, these captive retail customers may have no viable alternative to the natural gas provided by Spire Missouri.”  

Hopefully, the commission’s point will be heeded. 

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