Atlantic Coast Pipeline Canceled Amid Legal Challenges, Ballooning Costs

BERKELEY, CALIFORNIA—JULY 6, 2020—Duke Energy and Dominion Energy, two of the nation’s largest utility companies, announced Sunday the cancelation of the Atlantic Coast Pipeline, a 600-mile natural gas pipeline that would have crossed West Virginia, Virginia, and North Carolina, and under the Appalachian Trail. The companies cite “ongoing delays and increasing cost uncertainty which threaten the economic viability of the project.” Dominion Energy also announced the sale of most of its gas transmission and storage assets to Berkshire Hathaway Inc.

The announcement comes amid investors’ rising concerns about the viability of natural gas businesses in the face of the climate crisis. Earlier this year, Dominion evaded a shareholder resolution filed by shareholder representative As You Sow calling on the company to address the growing risk of stranded natural gas assets. The company blocked the resolution through the U.S. Securities and Exchange Commission, claiming it had already done enough to mitigate stranded asset risk for its planned gas investments, including the Atlantic Coast Pipeline. While Dominion and Duke have set net-zero emissions targets in the past year, both had failed to address the significant climate impacts of their reliance on natural gas.

Lila Holzman, energy program manager of As You Sow, made the following statement:

“We are pleased to see that Dominion and Duke have decided to end the pursuit of this problematic project. This announcement puts the companies in a better position to confront the challenges and opportunities of the clean energy transition.

“Investors have increasingly raised concerns about the costs and risks of natural gas assets like the planned Atlantic Coast Pipeline. To avoid the worst impacts of the climate crisis, our companies must transition away from the use of fossil fuels. Building more gas infrastructure now without a clear justification is a recipe for stranded assets.”

Daniel Stewart, energy program fellow of As You Sow, made the following statement:

“The cancellation of the Atlantic Coast Pipeline is a clear example of the changing environment in which utilities operate. Policy, economic, and technological drivers combined with investor pressure and concern for the climate are raising increasing questions about how gas-reliant businesses will brace for disruption.”