First ‘Energy Hub’ Hearing Stacked with Business Interests; Environmental Experts Not Invited

By Dustin Slaughter

City Council’s Special Committee on Energy Opportunities launched the first in what will possibly be a series of public hearings on the matter of turning Philadelphia into a major east coast location for energy production and exports due in no small part to the Marcellus Shale.

Testimony from the heads of Philadelphia Gas Works (PGW), Philadelphia Energy Solutions (PES), and other private interests dominated the session. Noticeably absent from any input – at least during this phase – were grassroots organizations and residents, particularly from Philly neighborhoods in the vicinity of oil refineries.

EPA data from 2012 indicated that Philadelphia Energy Solution’s South Philadelphia refinery released 762,392 lbs. of toxins into the air – 11% of which are considered carcinogenic – a slight decrease from over 800,000 lbs in 2011.

PGW CEO Craig White spoke before Councilman Bobby Henon, Councilwoman Marian B. Tasco (both co-chairs), Councilman Kenyatta Johnson, Councilman Ed Neilson, and Councilman David Oh, of the city and PGW as being “in a prime position” to benefit from the Marcellus Shale’s natural gas resources, but only if “the opportunity is seized.”

At issue during today’s hearing was whether the city and PGW could find the money needed to build, as well as strengthen and expand existing infrastructure, in order to increase the flow of natural gas from the Marcellus shale to the Philadelphia region.

“Building gas lines is crucial to making Philadelphia an energy hub. There has to be a gas line connection to Philly,” White stressed to the committee.

White also emphasized the “enormous potential” Philly has, due to the region’s refinery capacity and “untapped” blue collar workforce. He estimated that the region stands to gain upwards of $100 million in revenue if the transformation is successful.

Councilman Ed Neilson asked White about the current safety level of PGW’s gas line infrastructure.

“Safety really isn’t an issue,” White reassured Neilson. White claimed the utility company has been in the process of upgrading over 3,000 miles of pipeline to the tune of $20 million.

An annual report from the Pennsylvania Utility Commission in 2014 reported 25 investigations launched by its prosecutory staff; 156 gas safety violations issued; and 131 violations “handled by non-compliance letters”. The PUC is tasked by the U.S. Department of Transportation’s Office of Pipeline and Hazardous Materials Safety Administration with investigating and ensuring pipeline safety throughout the state.

One committee member asked White if there existed a major metropolitan energy hub Philadelphia could look to for an example of how to achieve a successful transformation.

White could not point to any.

Part of the committee’s focus for funding increased pipeline capacity for the Philadelphia region centered on exploring the use of a funding model known as Public Private Partnership (P3). Details on what a P3 model for Philadelphia might look like, and how it could be achieved, were scant, however – and not just from PGW’s White.

Philip Rinaldi, CEO of Philadelphia Energy Solutions, when asked about his knowledge of the P3 model, was unable to provide any meaningful detail about how one could be successfully implemented for Philadelphia’s energy ambitions.

Sam Bernhardt of Food & Water Watch, a national advocacy nonprofit, who despite registering to testify, was not invited to do so at today’s hearing, had prepared a statement nonetheless, and provided it to The Declaration. The group is “extremely concerned” about the prospect of a P3 model and what it could cost Philadelphia’s fiscal health, calling the plan “intrinsically risky for municipalities, as they disproportionately expose the public side of these deals to risk.”

The prepared testimony went on to state: “It is important to remember that these advocates from the oil and gas industry [are] motivated by one thing, and it’s not the city’s financial health, but their own corporate bottom lines. Phil Rinaldi is the CEO of PES, not Philadelphia.”

Rinaldi, in addition to being the CEO of Philadelphia Energy Solutions (an LLC just two years into operation), currently chairs the Greater Philadelphia Energy Action Team (GPEAT), comprised of business interests seeking to “influence the future of the energy economy in Philadelphia,” according to its description on the Greater Philadelphia Chamber of Commerce website.

In prepared remarks before council today, he touted the “transformational” economic benefits that could come to Philadelphia in the form of a revitalized manufacturing base. He said turning the region into an energy hub “is a matter of urgency.”

A press spokesperson for Councilman Bobby Henon’s office did not respond to Declaration inquries about whether or not environmental experts and sustainability advocates would be invited to testify, as well as how many more public hearings the Special Committee intended to convene.

A joint press release from Food & Water Watch and Clean Air Council went out after today’s hearing, stating:

“…councilmembers heard and discussed ideas for scaling up fossil fuel infrastructure in the city that would endanger public safety, harm public health, and expose the city’s finances to a high degree of risk.”

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