Last month, right before FERC was to hold its first scoping hearing on the PennEast pipeline, the PennEast Pipeline Corporation released an 
economic impact report. The media picked up and dutifully transcribed the press release, and headlines touted 12,000 job figure, and gazillion of dollars that would flow into Pennsylvania and New Jersey.
PennEast contracted with Drexel University and Econsult to produce the report. The report is being widely criticized for wild claims of job and economic benefits. Of particular interest is the claim of 12,000 jobs.
A closer look reveals that the number refers to every job that could be related in any way during the seven-month construction period, making the job total much less once construction ends, environmentalists claim. This would include a food truck worker selling a Taco to an out of state pipeline construction worker as being counted a “job”.
“No respectable economic analysis would give a result this large and the best recent work suggests there would be little if any net employment gains beyond the direct hires, most of who would be recruited from outside the area,” Jeffrey R. Shafer, former undersecretary of the U.S. Department of Treasury, stated in the release.
DREXEL UNIVERSITY
When asked about the report, Niki Gianakaris, a spokeswoman for Drexel University stated “”Drexel professor Vibhas Madan and Econsult Solution’s Steve Mullin conducted a simple standard input-output analysis based on data provided by PennEast. This was neither a cost-benefit analysis of the project nor an endorsement of it. This was a straight analysis of employment, fiscal and potential price effects of the project.” (emphasis added)
There you have it; the report is based on a SIMPLE INPUT-OUTPUT analysis based on DATA PROVIDED BY PENNEAST. As anyone who has designed or used a database, modeling or similar program knows, if Garbage goes IN then Garbage comes OUT.
The PennEast report is also being questioned by connections with Drexel University and raises the issue of conflict of interest. Lon Greenberg, former CEO and current non-executive chairman of the board for the UGI Corp serves on Drexel’s LeBow School of Business Corporate Governance Center.
Of course Drexel denies that a conflict of interest exists.
Really?
Drexel’s Center for Corporate Governance enjoys support of generous investors such as….surprise…surprise – UGI.
PENNEAST REBUTTS
PennEast was quick to attempt a rebuttal.
Patricia Kornick, spokeswoman said “Simply because the results of the economic analysis do not align with the numerous misconceptions perpetuated about this project does not mean they aren’t the facts.” Unfortunately, when the economic analysis is based on data provided by PennEast, the resulting “facts” may not really be “facts”.
Kornick went on to say Drexel University’s analysis is the first of two studies that PennEast has commissioned with “credible, third-party entities.” Within the next several weeks, PennEast expects to have the results of the second study on consumer-specific benefits of the proposed project, she said.
Does a credible third party entity mean there are no PennEast members on the board, or are generous investors or other connections?
Is this 2nd report also based on PennEast supplied data?
It may be several weeks from release, but we predict the “consumer-specific benefits” report will not contain any downside to the pipeline, but will say:
- Everyone along the route will have a ceee-ment pond in their backyard
- Children will get ponies and puppies for Christmas
- Food Truck operators will make millions selling Tacos in the 7 month construction period
- Unicorns will be prancing and dancing on rainbows over the pipeline
No Exports?
PennEast’s proposed route is also uniquely capable of providing an interconnection with Spectra’s Algonquin Gas Transmission, LLC. The Algonquin connects to Texas Eastern Transmission and Maritimes & Northeast. The Maritimes extends from Nova Scotia into New Brunswick, Maine, New Hampshire, and Massachusetts where it connects with Algonquin Gas Transmission’s Hub Line near Beverly, Massachusetts. There it provides a seamless link for Spectra Energy systems from offshore Nova Scotia to south Texas and the Gulf Coast.
© 2015 by Dory Hippauf
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