DelayLine3, Enbridge, Friends of the Headwaters, Honor The Earth, Line 3, Minnesota Public Utilities Commission, MN Department of Commerce, MN PUC, MNDOC, Red Lake Band of the Chippewa, Scott Strand, Sierra Club, White Earth Band of the Ojibwe
Line 3 project has Enbridge lackeys currently eating through our forests here in Northern Minnesota. If you want to witness the destruction, you can review Facebook pages for RISE Coalition, Shanai Matteson, Ellen Hadley and many others. Lots to see as these Warriors hold the line until we can resolve the legal battles around the project. The Court we hope will rule quickly on filings made. Today I will focus on the various legal filings to the Minnesota Court of Appeals, specifically on their arguments regarding the Certificate of Need – or more precisely, the lack thereof, for this project.
BIG Thanks to all the Legal Folks making this work happen…
from Friends of the Headwaters to Tribal Bands to Minnesota’s own Department of Commerce.
[Update: Fuck that last one as they never did get on board for a Stay?]
It is clear from MN Statute 7853.0130 that when the PUC grants a Certificate of Need for an oil pipeline, the applicant must provide evidence of a demand forecast.
The Department of Commerce filing notes the PUC’s illegal approval and improper resulting action:
The Commission granted a certificate of need, holding that, although Enbridge did not submit an energy demand forecast, Enbridge’s forecasts on other topics and other evidence provided a sufficient substitute. …
The Department of Commerce consistently challenged Enbridge’s proposed forecasts for failing to account for demand, raising the issue in testimony, in briefing, in exceptions to the administrative law judge’s recommendation, and during Commission hearings. … The Department preserved the issue for review, as required by statute, in reconsideration petitions to the Commission’s orders granting a certificate of need. …
The Commission held that forecasts based on supply were sufficient to show demand for oil and that other parties failed to introduce sufficient evidence to show demand would be reduced in the future. …
The Department initially raised this issue in its exceptions to the administrative law judge’s report. Because the Commission adopted the administrative law judge’s legal position on this issue and reiterated it in its order, the Department raised the issue in reconsideration petitions to the Commission’s three orders granting the certificate of need.”~ DOC Filing to MN Court of Appeals on their Illegal approval of a Certificate of Need for Line 3 (page 1)
The DOC filing notes: “In 2016, a federal court in Michigan issued a consent decree that required Enbridge to seek all necessary approvals to replace the existing Line 3.” What this means is that they were ordered by the federal government to try to get a new pipeline for safety concerns on their current line. What it DOES NOT MEAN is that Enbridge gets a free pass to securing permits for a new pipeline.
The PUC appears to admit, in their testimony from 12/4, that they ASSUMED this consent decree meant they MUST approve the new pipeline because of safety. They have not READ THE LAW correctly on that assumption. And as the saying says about assuming… they do look like four stupid asses. [Cause, you know, Commissioner Schuerger has READ THE LAW and APPLIED IT and READ THE RECORD and decided that there is NO NEED for a new tar sands pipeline through Minnesota. The Demand forecast is just ONE of his many reasons for denying the project.]
The DOC lays it out pretty plainly. They explain that the statutes require “a ‘long-range energy demand forecast on which the necessity for the facility is based.’ Minn. Stat. § 216B.243, subd. 3.” More simply put: “To approve the construction of a crude oil pipeline, the Commission must determine that crude oil is needed.” However, Enbridge provided the Muse Stancil Report which projected utilization – NOT DEMAND. This report also noted that oil not used in the US could be exported… So… NOT for the 5-state region Enbridge claims to be supporting? For GLOBAL export?!? And they report that the author of the report “acknowledged that he ignored demand for refined product”!
The PUC failed: “By relying only on a single supply forecast based on oil producers’ expectations, the report ignored external factors affecting pipeline utilization, such as the expansion of other pipelines or the demand for refined products.” The PUC failed to consider either demand or global gluts of refined products (Thanks, Coronavirus!) that we are now seeing as our reality. So, they were WRONG. And in their errors, they violated the law and FAILED to protect Minnesotans from a Canadian corporation running roughshod over us here in the North Country.
the Commission granted the certificate of need, despite the Department’s objections that Enbridge failed to introduce an energy demand forecast.”~ DOC filing (page 7)
They add: “The Commission cited the Muse Stancil Report and evidence of apportionment on Enbridge’s mainline as sufficient bases to substitute for an energy demand forecast. The Commission reached this conclusion despite recognizing that a “key” input into the Muse Stancil Report was a crude oil supply forecast, rather than a demand forecast.” The PUC error seems pretty clear. The DOC filing goes on to reiterate the continued failings of the PUC throughout the process, relying “on the supply forecasts in the record to conclude that the oil supply will continue to increase and future demand will be equal to or exceed that supply”, which is so obviously NOT the case as 2020 has made QUITE clear. The PUC refused to be swayed by science or reason. Again and again. [We could have avoided YEARS of wasted taxpayer dollars if they’d just applied the law and said, Nope.]
Regarding the law, the DOC provides multiple cases that conclude the Court of Appeals is not bound by PUC decisions or required to defer to the PUC’s expertise (or lack thereof in this case). In fact, the DOC notes that the PUC’s shift to burden the opposition parties is another blunder for them to consider. They go on to do just that after explaining – in a way even a 2nd grader can understand it – why the PUC violated the law when not requiring Enbridge to provide a DEMAND forecast for their transportation of tar sands and approving the project anyway. They get pretty detailed… providing an entire paragraph on how various dictionaries define “energy” to confirm the statute details (page 13-14). They do point out the many idiotic ways some Commissioners tried to define the “need” for a new Line 3.
This fun section (starting mid-page 17) explains how Enbridge duped most of the Commissioners [but not us Water Protectors!]. “Even though his report’s model assumed crude oil demand would automatically absorb supply, the Muse report’s author puzzlingly agreed that future demand for crude oil would ultimately drive use of Line 3. … Rather than assisting the Commission in determining whether the crude oil supplied by the proposed project will be needed, the Muse Stancil Report’s assumption of continuous high demand assumes the project is needed.”
If it wasn’t so fun to read of the PUC failings over and over again, you might get sick of how many ways and how thoroughly the DOC explains the Commissioners’ repetitive reliance on the supply forecast – in error. Here’s one more…
Because the Commission committed legal error by failing to evaluate a forecast of demand for the type of energy to be supplied by the proposed facility, and instead relied on the pipeline utilization forecast based on crude oil supply in the Muse Stancil Report, the Court should reverse.”~ DOC Filing (page 20)
OK, OK. Thanks for indulging me. The DOC goes on to write about how neither Apportionment nor the Desires of Enbridge’s Customers is a Demand Forecast. [DUH… unless you are one of our four erroneous (idiot/bought?) PUC Commissioners] Then they close with a review of the PUC’s SHIFT, placing the burden on opposition parties to prove the pipeline WASN’T needed, noting this too gives one pause. For Fucks Sake. Statutes require the Applicant to prove a need for their requested relief. [This ain’t Rocket Science! Though this sure reminds of the PUC! Had to stick some recent fun in…]
This says it pretty clearly:
Despite Enbridge’s legal obligation to provide an energy demand forecast to prove need, an erroneous legal standard pervaded the proceeding—that parties other than Enbridge must show that demand for crude oil would be reduced in the future, and therefore the pipeline would not be needed. This shift of the burden of producing a demand forecast and the burden of persuading the decision-maker to show the project would not be needed began with the ALJ. Relying on the Muse Stancil Report’s assumptions that refineries would operate at capacity, the ALJ required intervening parties to quantify how demand for oil would be reduced. …
While the ALJ recognized that global forces reducing demand for oil are ‘very real,’ she nevertheless stated that ‘no party has presented any data actually quantifying this possibility.’ The ALJ went on to find that ‘raw claims alone do not negate [Enbridge’s expert’s] assumption that (at least through 2035) surplus oil can be exported outside the U.S.’ …
In other words, the ALJ required the other parties to prove that crude-oil demand would decrease, instead of requiring Enbridge to forecast the demand for crude oil from Line 3.
The Commission carried through this burden shift to its orders, concluding that intervenors failed to introduce into the record “sufficient evidence of the extent to which … forces could reduce demand during the forecast period.”~ DOC filing (page 26-27)
The DOC goes on to really hammer the point home… a couple more times. For the real legal/word nerds, the last full paragraph on page 28 is a favorite. 😀
The filing submitted by Red Lake Band, White Earth Band, Honor the Earth and Sierra Club (The Parties) presented on the issue of Need, along with two other considerations that ask the court to reverse the PUC’s decisions. With regard to Need, there is a great explanation of Enbridge’s erroneous reliance on the Canadian Association of Petroleum Producers (CAPP) forecast of “supply” as their proof of “demand” for their product, a new pipeline. (pages 4-6) There follows a rational explanation of why neither Enbridge nor its customers are who drive demand. Don’t we all understand that demand is decided by all of us in how we choose to use the final products? This is driven home by quotes from the Administrative Law Judge who heard the testimony:
It is commonsense that reduced demand for refined products would impact the price, supply, and profitability of crude oil. By ignoring the demand for refined products –and focusing only on the supply of Canadian crude –Mr. Earnest’s analysis ignores an important factor in forecasting the need for additional transportation of crude.”~ The Parties Filing (page 8)
They further note: “In the Muse Stancil model, “demand for crude oil” is a modelling assumption, not a model output.” & “This forecast assumes that if U.S. demand is not sufficient to consume all supplied Canadian crude oil, then overseas demand would be sufficient in all future years to demand this supply.” (page 9) Which is none of their business really, as the PUC is only authorized to consider the energy needs for citizens in our region, not the whole fucking planet. [my emphasis]
Following the plain language of the law, the Court will reverse this capricious PUC decision. (pages 14-15)
The Arguments made by The Parties are strong and clear, and similar to the DOC filing, include definitions, this time for “demand”, “forecast”, and “accuracy”. They claim:
… the legislature, when it enacted Minn. Stat. § 216B.243, intended for determinations of “need” for energy transportation infrastructure to be based on a forecast of consumer (public) demand for energy, because it is society that demands energy, not the companies that supply it.”~ The Parties filing (page 18)
There follows an edifying explanation of energy demand and consumers. And… some additional piling on of how asinine the approving Commissioners have been to obediently lap up Enbridge’s “proof” of “demand” without giving consideration to either A) facts or B) Enbridge’s obvious self-aggrandizement. Personally loved this line: “The CAPP production and supply forecasts should be seen for what they are: the Canadian oil industry’s black box estimates of its own future crude oil production and exports.” [aka Wishful Thinking, Thanks, Paul!]
Bottom line: The Parties ask the court to “remand this matter to the Commission for hearings to allow presentation of a forecast of consumer demand for petroleum supported by adequate disclosure of its underlying data, assumptions, calculations, and methodology”. So mote it be.
And… since I cannot seem to stop myself from reading all these legal documents that give me such hope, and more importantly because I am a HUGE FAN, I’m gonna go on to also read the filing from Friends of the Headwaters’ Scott Strand. Yep. And you know what? I can summarize it in a couple shots of the Table of Contents!! Here we go…
What the PUC did:
Why they were Wrong:
How they were Criminal Assholes about it all:
As you can see from the descriptive titles on each section, Scott eats their fucking lunch legally. But this seems to be where the brashness ends as he cuts to facts and serious arguments for the narrative. I’ve enjoyed watching this guy argue in front of the PUC for YEARS and I gotta give BIG kudos to FOH for paying him to keep doing it. Support them if you can. They’re literally a bunch of old folks down in Park Rapids spending their own time, green, and energy trying to stop a pipeline. And begging for more money to keep doing that. And they’re old now because they been doing this shit for too many fucking years. Seriously, give them some money. Do it today. It’s all I want for Christmas. Really. [OMFG… am I channelling Helen? Did Margaret’s BFF die? Please tell me no because I LOVE that mouthy bitch!]
While the longer narrative is a bit drier, it’s still a joy to read for this nerd. Now go give some money to Friends so we can WIN this Legal Battle once and for all!!
And what can Minnesota expect should the Court fail to adhere to the law and grant a Stay? The results we saw in Pembina County, North Dakota for Enbridge’s short 13-mile stretch there may tell the tale. At 26 times the length they had, our 337-mile project could lead to thousands of deaths, exponentials being what they are…