Unanimous Takeaway from Hearing on Energy Supply Vulnerabilities: NC’s Reliance on Single Pipeline is a Major Risk

Dominion: “The number one vulnerability we have is that we have service from a single interstate provider and that all of our supply is delivered through that pipeline”

Duke: “Electric generation for natural gas receives all of its gas from this pipeline. There is no other gas supply for electric generation in North Carolina.”

Former Utilities Commission Chair: “There’s Transco for natural gas and there’s Colonial for liquid gasoline. They’re the only two major pipelines for NC.”

Raleigh, N.C. — The Senate Agriculture, Energy, and Environment Committee today heard unanimous feedback that North Carolina’s reliance on a single pipeline, Transco, for natural gas is a major vulnerability, as is the state’s heavy reliance on the Colonial pipeline for liquid fuel.

Committee co-chair Sen. Brent Jackson (R-Duplin) said, “The Colonial Pipeline disruption could have been much worse, and it’s foolish to presume North Carolina will not face a more severe energy supply shock in the future. We should treat the fallout of the Colonial Pipeline attack as a warning, not an aberration, and prepare accordingly.”

Former Utilities Commission Chairman Edward Finley, Duke Energy Senior Vice President Nelson Peeler, and Dominion Energy Vice President Rusty Harris spoke before the committee during the two-hour hearing.

Mr. Harris from Dominion reported to the committee that North Carolina’s “number one vulnerability is that we have service from a single interstate provider and that all of our supply, and most of our storage, is delivered through that pipeline. That pipeline is full. The Transco pipeline is fully subscribed. Every bit of capacity on the Transco pipeline, somebody owns it.”

Mr. Harris suggested that “additional pipelines would make a big difference in this particular vulnerability and limit our exposure if a single pipeline were to have a major disruption.” He said that compared to other states which have large pipeline networks, “we are unique in that we are pretty much dependent upon this single pipeline to bring gas into North Carolina.”

Mr. Finley, who was appointed to chair the Utilities Commission by two different Democratic governors, warned that “Colonial owns and operates a single pipeline through North Carolina” and “Transco, likewise, owns the single major pipeline for natural gas” that serves the state. He told the committee that during his 12 years chairing the Utilities Commission, “the hope was there would be additional interstate pipeline capacity for bringing natural gas into the state” based on “the desire to decrease risk of disruptions from the single Transco pipeline…”

Two projects, the Atlantic Coast Pipeline and the Mountain Valley Pipeline-Southgate, have been proposed to do just that in recent years. The Atlantic Coast Pipeline was scrapped after costly litigation from environmental activists, and the N.C. Department of Environmental Quality recently denied a crucial permit for the Mountain Valley Pipeline-Southgate.

Committee members heard from Mr. Peeler from Duke Energy about the potential impacts of a disruption in the Transco pipeline. Mr. Peeler said that compared to the recent Colonial incident, “a disruption in Transco would have a much more immediate impact. That’s because the fuel from the natural gas pipeline is delivered directly to an electric generator. It’s not stored anywhere. We’d see immediate disruption not just to our electric generation, but also our local distribution companies providing gas for industrial purposes or for homes. It would be an immediate disruption if that pipeline were disrupted.”

Sen. Paul Newton (R-Cabarrus) said, “The message from today’s hearing couldn’t be clearer: North Carolina’s reliance on a single pipeline is a critical vulnerability. We also heard that the Transco pipeline is fully subscribed, meaning there’s no prospect of future supplies to accommodate the state’s growth. This issue is vital to North Carolina’s future, and I expect the Senate will treat it as such.”