Central VA counties seek disclosures from elusive pipeline company

Virginia News

A representative of Encompass Energy faced harsh criticism from Louisa County Supervisors.

HENRICO, VA. (WRIC) — Three central Virginia counties have now filed motions with the Virginia State Corporation Commission (SCC) calling on them to regulate a proposed natural gas pipeline.

That puts them in opposition to Chickahominy Pipeline, LLC (CPLLC), which requested that the commission exempt them from state regulatory oversight.

County officials in Louisa and Henrico previously expressed frustration with a lack of transparency from the company, with one Henrico official telling 8News the company’s approach had been “completely out of the norm.”

In two new filings, Henrico and Hanover Counties called on the SCC to begin the discovery process, which could compel CPLLC to disclose records requested by attorney’s representing the counties.

Both counties also called on the commission to reject the company’s argument that they shouldn’t be subject to regulation as a public utility, with Hanover requesting the commission “enter an order declaring that it has the authority… to regulate the safety of the Pipeline to be constructed, owned, and operated by [CPLLC].”

CPLLC will have until October 15 to respond to the counties’ request to enter the discovery process.

The largest portion of the proposed pipeline would lie in Louisa County, with the second-largest section crossing Hanover.

This map, provided to Louisa County by Encompass Energy, shows the full path of the proposed pipeline.

Although Louisa County has yet to file a formal motion, at a board of supervisors meeting on Oct. 4, they had strong words for a representative of Encompass Energy, the firm contracted by CPLLC to survey the proposed pipeline path.

“It’s been real funny how this company has tried to gain the support of us who, our responsibility is to represent our people and protect our land,” said board chair Robert F. Babyok.

He said they were caught off guard by questions from citizens who received survey letters before the company made any contact with the county.

“You must have drawn the short straw to be sent here tonight,” said vice-chair Duane A. Adams. “I’ve been in business for forty years, sat on this board for four, and that’s the worst presentation I’ve ever seen in my life.”

Board members were frustrated with the sparse information given to them, but recognized that Encompass Energy was not ultimately responsible.

Irfan K. Ali, the registered agent of both CPLLC and Balico, the company behind the natural gas plant itself, did not appear before the board as requested.

“Mr. Ali, if you’re watching, where the hell are ya?” Adams asked.

Precedent for Regulation

In a staff opinion filed on Oct. 8, the SCC’s own counsel recommended that the commission reject the company’s argument, saying it was an attempt to “subvert the Utility Facilities Act and escape regulation.”

In their filing, staff say the gas plant and pipeline companies share both a manager and a principle address.

That lead staff to ask whether the law allows “an entity that would otherwise be considered a public utility, to subvert regulatory oversight by simply creating a shell corporation to hold its utility assets.”

And while ultimately the decision will be made by the commissioners, the SCC’s counsel made their position clear: “Staff thinks not.”

Virginia Natural Gas has also given notice that it wishes to participate in the case. The proposed Chickahominy Power plant lies within VNG’s exclusive service territory, which means the company may need to seek a special exemption to build a separate gas infrastructure.

According to CPLLC, that’s necessary because it is “impracticable and unfeasible to procure an adequate supply” from VNG.

In their filing, Henrico disputed that claim, saying, “Nothing in the application indicates any need for new pipeline facilities other than planned improvements or expansions to existing VNG gas infrastructure.”

The staff filing is only an advisory statement, and a representative of the commission told 8News that they would make their final decision based on the filings of all concerned parties.

Read the full SCC staff report below:

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