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Facts, Not Drama, Should Drive Utilities Board Pipeline Decision

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By Ed Wiederstein, 
Chairman of the Midwest Alliance for Infrastructure Now Coalition

There’s a good reason that Iowa has established an Iowa Utilities Board. It is an organization designed to look at the facts, letting professionals and not politicians decide on important matters for our state.

The issue of a proposed pipeline is vitally important to our state. We can’t let interest groups try to take over the process assigned to the Iowa Utilities Board. But that isn’t stopping the Iowa Citizens for Community Improvement (ICCI), a left-leaning anti-energy development group, from efforts to keep the board from an impartial review based on the facts.

In mid August Utilities Board staff traveled to the ICCI office to hear the special interest group “hammer home two critical demands,” according to ICCI’s Facebook page. Those demands? The first was for a delayed public hearing. The second was simply to deny the pipeline permit.

In other words, the ICCI believes that board should ignore input from the public or any other group and just go ahead and say “no,” regardless of the facts. That’s not the way things should work in this state.

In question is the Dakota Access Pipeline Project. It would carry up to 570,000 barrels of light sweet crude oil a day from North Dakota to Illinois, where the oil would be distributed to U.S. markets in the Midwest, East Coast and the Gulf. Thousands of jobs will be created and billions will be invested. Millions in new tax revenue will be generated across the state.

Farmers and other landowners will benefit from easement payments as well as extensive coordination on land use and protection. Not to mention the influx of crude oil onto the market, upon which our entire economy depends.

Despite these facts, the ICCI continues to spread misinformation about this project. It claims that shutting down the proposed pipeline would stop the passage of oil through Iowa. But the reality is that without the pipeline, we would see the continued use of a tremendous number of trucks and rail cars passing through Iowa with loads of oil. It is clearly true that pipelines are the safest way to transport oil. Rails and trucks can be put to better use for transporting agricultural products rather than in competition with farmers.

The ICCI has told the Iowa Utilities Board that its view is “in the best interest of Iowans.” That’s pretty cheeky. We don’t believe it’s in the best interest of the farmers who would lose revenue from their land use. It’s not in the best interest of those like farmers who rely on rail transportation. It’s not in the best interest of any Iowans traveling on roads and highways filled with unnecessary tanker trucks.

Let’s stop the drama from special interests. We believe that when the Iowa Utilities Board looks at the facts, it will support the pipeline. Regardless, it is critical that the board’s decision be unbiased and fact-based.

Ed Wiederstien is an active farmer in Audubon County in rural Iowa, and is a past president of the Iowa Farm Bureau Federation. 


Bloomberg: Pipelines Help Keep U.S. Oil Competitive

 

Consumers around the world are currently being subject to what has been called an “oil price war”, with certain countries artificially keeping petroleum prices low in order to force American energy off the market, going so far as to lose money themselves. This shows how seriously America is being taken as an energy player and the lengths that other producers will go to maintain the status quo. The goal that is American energy independence will truly be a transformative event, and nowhere will that be more apparent than in the Midwest.

Despite the slump in prices, the Bakken oil patch has done well. While production is down slightly, the boom and bust cycle of the past is unlikely to repeat itself and the situation has been described by one observer as changing from “white hot to merely red hot.” However, there are many actions we can take to make that outlook even better.

Bloomberg recently published an article looking at the Permian shale region in Texas, observing that it is currently the only oil producing region in the country that has increased its output. The answer as to why that is happening is quite simple. According to John Auers, a vice president at an energy consulting firm, the region’s well-developed pipeline infrastructure has kept transportation costs low, and has made Permian shale oil more competitive, even in a low-price environment. According to Auers:

Putting in those pipelines and connecting the Permian to the Gulf directly allowed that premium to develop. When you talk about these price levels, $5 to $10 is the difference between putting rigs back to work or shutting down.

North Dakota and the surrounding areas are currently dependent on crude by rail shipments (CBR) for between 50 to 70% of its monthly output, which can tack on extra charges for transportation and can cost billions of dollars every year (and hurting our farmers as well). In times when other countries are gaming the markets, the difference between pipelines and CBR can mean everything. North Dakota and the region have benefited enormously from the energy revolution which has created well-paying jobs, and new sources of revenue to invest into cities and communities. A state of the art energy infrastructure is needed in our region to keep the Midwest competitive and ensure that the boom and bust cycles that have defined the past are not repeated again.


American Farm Bureau Federation Study: Pipeline Infrastructure Key to Unloading Freight Rail Backlog

The American Farm Bureau Federation has released a paper examining the link between oil rail shipments and the backlog faced by agricultural producers in the Upper Midwest. According to AFBF Chief Economist Bob Young:

American farmers depend upon rail freight to move their products to market. The surge in rail transportation of crude oil has affected that ability and timing in recent years. Construction of new pipelines would certainly be a more effective way to move that product to market. It would take crude oil off the rails and, in doing so, improve the overall efficiency of the transportation system. Improved pipeline infrastructure will also help enhance American energy security for everyone.

The author of the study, ag expert Elaine Kub highlighted the unique challenges that farmers face when attempting to move their product:

Due to the nature of grain production and use, the industry is fairly inflexible about which freight methods it can use, so any time one of those methods is unavailable, crops are lost or cost more to transport. This leads to more expensive food for families and less profitable incomes for farmers. Crude oil, however, can be more efficiently and affordably shipped through pipelines, and can be done without crowding already overstressed railways.

Far from identifying problems with our infrastructure, the study also took a proactive look at what could be possible:

The AFBF study also featured mathematically simulated scenarios showing how expansion of any freight method – truck, rail, barge, or pipeline – can reduce overall congestion and, in certain scenarios, could increase the annual volume of grain moved by as much as 14 percent.

To read the entire study, click here.


Iowa Train Derailment a Strong Argument for Continued Infrastructure Investment

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Fruitland, Iowa, was the site of an unfortunate accident last Friday, with six freight cars overturning just east of the city. No one was hurt in the incident, and the overturned cars were filled with automobiles.

The incident elicited a reaction from locals and jump- started a debate over the future of our infrastructure growth. Writing to the Muscatine Journal, one resident stated:

We need to take a serious look at infrastructure upgrades in this country, which includes energy infrastructure. I would feel much more comfortable shipping these resources through modern pipelines, and safer alternatives, instead of running it through our communities on trains.

America’s freight rail system is the envy of the world and a prime example of a private investment for public good. The Economist has described it as the “unsung transport successes of the past 30 years.” However, the Bakken oil boom has put this system to the test, straining it to the limits. The percentage of oil carried by rail in the United States has increased by over 4,000% since 2008. Iowa has 30 of these trains crossing the state every week, each carrying a million gallons of crude oil.

We believe that the time has come to let our rail system focus on transporting things that make the most sense, such as grain, manufactured items, and other goods. Petroleum products belong in pipelines, where they can be routed away from major population centers and monitored around the clock. Projects such as the Dakota Access Pipeline can help make that happen.


Chairman Wiederstein Appears on the Radio, Explains Benefits of Dakota Access Pipeline

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MAIN Coalition Chairman Ed Wiederstein appeared on the radio in South Dakota to talk about the benefits of the Dakota Access project. Ed touched upon benefits the measurable benefits that the project would bring, such as the creation of thousands of construction jobs, and windfall in payroll and property taxes for the various states.

MAIN believes that the concern for safety should underpin all infrastructure development projects in our region, and the topic was discussed at length. Government statistics have shown pipelines to be the safest way of transporting oil and Wiederstein touched upon these points in the interview, and mentioned some of the new technology that will be built into the pipeline project.

While only a long term concerted effort will alleviate all the challenges that the Midwest faces with transporting the energy resources we have, to the consumers who need them, the Dakota Access Pipeline is a step in the right direction.

To hear excerpts from the radio interview, follow the link below:

http://wnax.com/news/180081-pipeline-debate-continues/


MAIN Chairman Ed Wiederstein: The public benefits of the Dakota Access Pipeline are numerous and important

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MAIN Chairman Ed Wiederstein

Ed Wiederstein, our coalition chairman, wrote an op-ed for the Cedar Rapids Gazette, in which he outlined the various benefits new pipeline infrastructure would bring to Iowa and the Midwest.

One of the common points of misinformation deployed in the debate over energy infrastructure investment is the erroneous idea that a privately operated network does not constitute, or contribute to, a public good. Ed writes that Iowa has a long, almost two centuries long tradition of privately-financed and operated infrastructure, which has served for the benefit of all Iowans. Chairman Wiederstein points out:

To facilitate travel and commerce throughout rural Iowa, the second General Assembly in the late 1840s authorized private companies to build plank roads. The public benefit was so obvious that the General Assembly passed legislation aimed at allowing construction to proceed smoothly (…) Even from the earliest days of our statehood, infrastructure was viewed as a public imperative.

Likewise, around the country and throughout history, one can see examples of privately-funded projects benefiting the public. From railroads, to the electrical grid, and pipeline networks, the public has long been the beneficiaries of these undertakings.

While these benefits are obvious and important, it is sometimes difficult to quantify the impact brought about by projects such as the Dakota Access Pipeline. However, as Ed Wiederstein writes, there are very tangible and immediate benefits in terms of job opportunities for Iowans across the state:

Construction jobs up to 4,000 in Iowa will see small towns all along the path benefit from added business. Construction means building something and eventually it gets built and then laborers hopefully move to another construction job. This is a great job for many construction workers that pays very well and utilizes their skills.

Iowa and the Midwest can benefit, both immediately, and over time, from projects such as the Dakota Access Pipeline. The public has a need for a steady and predictable supply of fuel to facilitate a growing and dynamic economy. The highly skilled workers living in our state rely on projects such as the Dakota Access Pipeline to support their families. As Ed Wiederstein says, the benefits of the project are “numerous and important” and we wholeheartedly support the approval, construction, and operation of the Dakota Access Pipeline.     


MAIN Coalition Members and Public Come out to Support Dakota Access Project in North Dakota Hearings

Members of LiUNA preparing food for participants at the Williston hearing.
Members of LiUNA preparing food for participants at the Williston hearing.

North Dakota’s Public Service Commission recently concluded its state wide listening session on the merits of the Dakota Access Pipeline, holding public hearings in Mandan, Killdeer, and Williston. Members of the MAIN Coalition as well as the general public were present at each of these hearings, providing statements in support of the project.

The Dakota Access project is projected to create 8,000 to 12,000 jobs along the route, is expected to generate over $50 million in tax revenues each of the states along its path, and is anticipated to be a $1 billion contribution in direct spending to the U.S. economy.

Our Coalition’s presence was noted by reporters at the meetings, especially in Williston, where Amy Dalrymple wrote:

The Midwest Alliance of Infrastructure Now, a coalition that includes labor unions, the Greater North Dakota Chamber and others, also voiced support for the pipeline.

The support of the labor members of our coalition was noted by an article in The Bismarck Tribune, which quoted of the Laborers District of North Dakota and Minnesota saying:

Our members are ready to work. We respect the process but we are excited to get our boots dirty and build this pipeline right.

Andy Peterson of the North Dakota Chamber of Commerce, representing the state’s business community, was present at multiple hearings, highlighting the benefits of the project to the state’s economy and national energy security. In a statement to the MAIN Coalition before the first PSC hearing, Peterson explained his support of the project by saying, “Pipelines like Dakota Access provide a safe, reliable, and efficient way to transport the crude oil that has fueled our state’s economic surge from the ground to American consumers, spurring billions in private investment and relieving pressure on rail and truck transport in the process.”

Several members of the public also spoke in support of the project, including landowners who described their positive interactions with land agents and the flexibility displayed by the company in modifying the route where possible.

The MAIN Coalition is confident that the Dakota Access project will be a benefit to the state of North Dakota and the Midwest, and is urging the PSC to review the project on its merits in a timely matter. We are confident that the project will help keep our economy growing and ensure long term growth and prosperity.


North Dakota Senator: Energy Infrastructure Development a “No-Brainer”

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The Energy Information Agency (EIA), the agency responsible for compiling information on the energy industry, held its annual Energy Conference in Washington DC this past week. Prominent thought leaders from both the private sector and government shared their views on numerous energy related topics. We were pleased to see the presence of North Dakota Senator John Hoeven among the prominent group of speakers, who touched upon the issues that the MAIN Coalition has consistently advocated for. The article reads:

“We need roads, we need rail, we need pipelines, we need transmission—and without them we cannot move energy safely, cost-effectively, dependably from where it’s produced to where it’s consumed,” Hoeven told the 2015 EIA Energy Conference, sponsored by the U.S. Energy Information Administration. “It’s just a no-brainer.”

North Dakota has taken advantage of the energy resources hidden beneath its soil and remained one of the few economic bright spots throughout the recent recession. The state boasts a 3.1% unemployment rate and is leading the nation in population growth. While these development have presented challenges, the state, and indeed the region, has benefitted overall from the energy revolution, raising living standards and providing opportunity.

We are encouraged to hear Sen. Hoeven’s stance on energy infrastructure development. This is an issue that has garnered bipartisan support, with Energy Secretary Ernest Moniz recently stressing the need for infrastructure to keep up with demand. There are many energy infrastructure projects currently under review by respective utility boards and agencies throughout the Midwest. We urge that they be reviewed in a timely manner.


SD Landowner and Legislator: “Dakota Access delivers confidence”

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Arch Beal, a South Dakota state representative from Sioux Falls and landowner, recently penned an LTE in the Argus Leader endorsing the Dakota Access Pipeline. After carefully reviewing the project, Mr. Beal concluded that the project would benefit the state by employing fellow South Dakotans (estimated between two and four thousand) during the construction of the project, generate tax revenue for counties along the route once completed (estimated at $13.5 million a year) , and help the state’s grain growers gain access critical rail shipment space.

Rep. Beal became acquainted with the project on a more personal level as well.  He owns land on the proposed route of the project and had the chance to interact with the company representatives while discussing land easements. Beal wrote:    

In my firsthand dealing with Dakota Access, I have seen them deliver on their stated policy of maximum protection for agricultural land and maximum accommodation of land owners. Specifically, Dakota Access professionals worked with me to create an individualized plan for my property. They amiably altered their original proposed path for the pipeline through my property to accommodate my plans for future development. Dakota Access paid attention to the agricultural needs with a mitigation plan to guarantee that future crop production would not be hindered.

MAIN is encouraged to see that Dakota Access representatives are taking care to ensure that landowners are being treated fairly and their concerns are being heard. The statements made by Rep. Beal were echoed by landowners In North Dakota at the recent Public Service Commission hearing in Mandan. Our region’s farmland is and will continue to be a valuable resource. It is vital that the extraction of our vast energy reserves complement this valuable asset.

We encourage the South Dakota Public Utilities Commission to review the application of Dakota Access in a timely manner. We believe that the many benefits of this project are tangible and will contribute to the continued economic success of our region.


Iowa Needs Budget Deal, Not Activist’s Pipeline Political Theater

Ed Fallon, a former Iowa state legislator and former candidate for governor, hosted an event today in support of a “poison pill” eminent domain bill currently under review by the Iowa state legislature. The event was largely a political distraction from lawmakers hard at work at competing the state’s budget.

The bill will inadvertently create barriers that will make any large scale energy infrastructure projects prohibitively expensive and virtually impossible in the state, preventing Iowa from getting access to billions in potential investments. This is an extremely troubling development for both the region and our nation as a whole. The U.S. Department of Energy’s recently released Quadrennial Energy Review (QER) has praised precisely these kinds of infrastructure projects, stating that they have:

“…improved U.S. energy security. Without it, the United States could not have reduced its reliance on imports of liquid fuels to the extent that it has.”

The Des Moines Register has recently voiced its dissent to the bill in a recent edition of their “Roses and Thistles” section. The staff opined:

“Bills backed by key Republicans and Democrats in both houses would require companies to have voluntary easements from 75 percent of property owners before receiving eminent domain authority from the state. Pipeline and power line companies say setting the bar so high could force them to risk costly investments in projects that may never happen. That would be fine with some proponents of these bills, however, because their aim is to block both projects. In the process, however, they could prevent all future pipelines and powerlines, even ones that environmentalists might support. Until scientists figure out a way to magically deliver power without wires or underground pipes, they will be necessary.”

 MAIN has expressed its support for the Dakota Access Pipeline project. As a coalition of stakeholders representing business, labor, and agricultural communities, we recognize the public benefit that such a project brings to our region. Our coalition chairman and former president of the Iowa Farm Bureau, Ed Wiederstein has said that:

“New pipelines – especially those that service the Northern Plains and the Bakken region in particular – are urgently needed. Dakota Access would take four to seven unit trains of crude oil off of the region’s rails, helping the region’s farmers and other commodities shippers to gain greater access to the affordable railcars needed to transport their products. Infrastructure improvements of this nature carry benefits that reach far beyond the energy sector, and deserve our support.”

 The Dakota Access Pipeline will help create well-paying construction jobs, reduce oil rail traffic, increase access of Iowa and Midwest farmers to trains transporting agricultural products, and generate tens of millions of dollars to state coffers in property taxes to use on whatever projects are of most benefit to the residents in each state.

Mr. Fallon’s statements are big on rhetoric and short on any concrete ideas. Whether he likes it or not, oil and natural gas will remain a major component of the national energy mix for decades to come.  Oil from the Bakken will continue to be transported through our region, whether it is through oil pipelines or oil trains, as they do so right now.

We urge Iowa lawmakers to complete the vital work at hand, approving the state budget, and to refrain from letting politics and empty rhetoric infringe on the review process for the Dakota Access Pipeline currently underway at the Iowa Utilities Board. Allowing external influence to infringe on an impartial review of the project would set a very dangerous precedent. Poison pill legislation is not the way to attract investment and promote the growth that Iowa and our region needs.