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Top stories of 2015: #1 — Vermont Gas abandons Phase II pipeline; PSB launches Phase I review

Vermont Gas in 2015 received some sobering news in its efforts to expand its natural gas pipeline into Addison County and points further south.
The company in February announced it was withdrawing its application for its proposed “Phase II” Addison Rutland Natural Gas Project that would have extended the pipeline from Middlebury, through Cornwall and Shoreham, then under Lake Champlain to supply natural gas to the International Paper Co. mill in Ticonderoga, N.Y. The company withdrew the application after new estimates placed the project cost at $105 million, up from the $74 million budget Vermont Gas initially filed with regulators.
International Paper — which would have underwritten the project as a means of replacing its fuel oil source with cheaper natural gas — balked at the new price tag, which they said could grow further to $135 million. IP officials also voiced concerns about a new project timetable indicating natural gas might not reach the Ticonderoga mill until 2016, instead of by the end of 2015.
“The costs were what they were, and there was no way to change that without changing the whole project,” IP spokeswoman Donna Wadsworth told the Independent at the time. “We tried to work it out with Vermont Gas, but ultimately the $135 million figure and time schedule made it impractical for us.”
Cancellation of the Phase II project also forced Vermont Gas to take off the drawing board a potential Phase III plan to take the pipeline further south into Rutland County.
While the Cornwall and Shoreham selectboards had approved agreements with Vermont Gas specifying the terms under which those communities could support Phase II, many residents in those towns celebrated the scuttling of Phase II. Scores of residents from those communities had voiced their opposition to the pipeline at hearings held by the Vermont Public Service Board. Opponents argued the pipeline would pose safety hazards, infringe on private property rights, cause environmental headaches for Lake Champlain, and might delay the region’s conversion to renewable energy sources.
Meanwhile, the PSB decided to reevaluate Vermont Gas’ Phase I project in light of surging cost-estimates for the 41.2-mile pipeline from Colchester to Middlebury. The PSB originally OK’d the project in December 2013, when the price tag was $86 million. But the board in March began discussing whether to reopen the permit after cost estimates for the project ballooned to $154 million — a 78 percent increase.
Still, Vermont Gas began work on the pipeline in anticipation that the permit would be affirmed. The company in early October announced a memorandum of understanding with the Vermont Department of Public Service placing a limit of $134 million on the amount it would seek from its ratepayers for expenses related to the Addison Rutland Natural Gas Project. That amount was $20 million less than the $154 million the company had forecasted for the project.
Vermont Gas officials in November confirmed they had reached land easement agreements with 160 of the 164 affected property owners along the Phase I project corridor, and noted that eminent domain proceedings are still pending against the four Monkton landowners who have declined to sign deals.
“I am grateful to the landowners who have worked with the company to reach agreement. This process requires commitment and attention, and I want to thank them for their hard work and effort,” Vermont Gas CEO Don Rendall said in November. “Where possible, we will continue to work with remaining landowners to try to reach agreements. We are hoping for resolution of these (disputes) by June of 2016, and we will have a work schedule that will be consistent with that timeframe.”
Rendall promised Middlebury residents and businesspeople would notice a lot of pipeline-related work in 2016. Protests of the pipeline continued throughout 2015.

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