Spire Predicts Devastating Consequence if the Feds Shut Down Pipeline

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Known as the largest natural gas utility in the state of Missouri, Spire STL Pipeline claims its patrons could incur “potentially fatal consequences” if its pipeline operation in St. Louis is canceled due to federal reconsideration. The company, a Spire Missouri affiliate, petitioned energy regulators seeking a temporary emergency certificate to continue natural gas transport.

Spanning 65-miles from Illinois to Missouri, the Spire STL Pipeline came into operation in 2019. Its operation recently received scrutiny by a federal court panel charging regulators improperly granted the pipeline’s approval. The company’s pipeline’s birth originated for reliability purposes. Spire estimates that nearly 133,000 customers could have succumbed to February’s cold and inclement weather with a loss of gas service. Record shortage and outages wreaked havoc in Kansas City and across the state of Texas.

“Due in large part to the STL Pipeline, St. Louis avoided those impacts,” Spire STL Pipeline said in its filing. “The (Federal Energy Regulatory) Commission must assure that customers who depend on this important gas infrastructure are not suddenly left without it – particularly as another winter season approaches.”

Resulting from Spire’s warnings, the Missouri Public Service Commission opened an investigation to review the validity of Spire’s petition. As cold weather months linger on the horizon, considerations will need to be reviewed and permanent decisions made.

“Loss of the STL pipeline will have a detrimental impact on the health and safety, the prosperity and the property of the St. Louis community, particularly the communities that are most vulnerable,” said Sean Jamieson, General Counsel for STL Pipeline.

Jamieson indicated that upwards of 175,000 Spire customers could lose service when temperatures plummet below 9℉ without the STL pipeline. The utility would be forced to draw from reserves if that were to happen. If those reserves deplete, Jamieson revealed that approximately 400,000 customers would be plagued with unreliable service at temperatures as warm as 38℉.

“So the gravity of the circumstances is severe,” said Jamieson.

Jamieson furthered that before the pipeline, Spire Missouri found itself highly dependent upon purchases of natural gas from Oklahoma and Texas. To date, they have become more competitive. 

After the Spire pipeline went operational, the capacity from other states no longer brought necessity. Returning to previous practices proves unavailable, and the company does not have access to that capacity.

The Spire Pipeline won FERC approval in 2018. An initial Environmental Defense Fund request for a rehearing received denial. The nonprofit appealed the 2020 FERC approval stating the agency had not studied the pipeline’s needs thoroughly.

Natalie Karas of the Environmental Defense Fund serves as the Senior Director and Lead Counsel on energy markets and utility regulation. She stated the court ruled that the FERC “failed to consider evidence of self-dealing and failed to demonstrate the pipeline was necessary.”

“This is a problem of Spire STL’s own making,” said Karas. “No one has suggested that service to St. Louis customers should be compromised. At the same time, customers must be protected from costs and risks associated with unnecessary infrastructure.”

Pipeline Specifics

2016 brought Spire’s desire to construct the pipeline, and it solicited contracts for the gas to be transported, but none committed. The Natural Gas Act stipulates that the FERC can issue a build certificate to gas companies if it finds that the pipeline “is or will be required by the presence of future public convenience and necessity.”

With no outside companies to contract with, Spire engaged in a precedent agreement with its own affiliate for 87.5% of the pipeline’s capacity. The FERC approved a certificate in 2018 for the pipeline, and the Environmental Defense Fund requested a hearing, which the FERC denied. As a result, the Environmental Defense Fund appealed their decision.

Jamieson indicated the pipeline’s future remains uncertain, but Spire will pursue all regulatory and legal outlets to provide energy reliability for St. Louis and its customers. Failure to invoke a rehearing could fluctuate the pipeline’s shutdown date.

 

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