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Is the State Putting the (Energy) Cart before the (Taxpayer) Horse?

November 10, 2009

Keystone-hearing

Looking at photos of damaged farmland

An editorial at the Aberdeen American News asks whether South Dakota law may need to be changed so that state approval processes for projects like the Keystone XL pipeline happen after federal processes. The paper’s concern is that if the state goes first, what happens to that effort and expense if the project dies during the federal process?

Project applicants are supposed to pay fees that cover the state’s expenses, so if South Dakota is losing money on cancelled projects, the problem could have more to do with how much the applicants are being charged rather than the order of approval processes. Given the state’s generosity with tax refunds for new construction projects, it would be good to know whether the cancelled energy projects the editorial mourns were charged the state’s full costs of approving them.

In addition, the editorial raises a point that Plains Justice has repeatedly made during the Keystone XL proceedings at the South Dakota Public Utilities Commission. The Commissioners may approve the Keystone XL pipeline before the federal environmental report is completed.

A new reason why that would be unfortunate: when the PUC approves the Keystone XL pipeline, it will presumably seek to place conditions on it, as the PUC did for the first Keystone pipeline. The federal environmental report will have information in it that could be very helpful to the commissioners as they set those conditions.

Photo: Stephanie Trask and Luke Temple of Dakota Rural Action show photos of farmland and roads damaged by Keystone pipeline construction to TransCanada executive Robert Jones.

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