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PennEast & Pilgrim Pipelines, Fossil Fuel Industry Have Major Presence in NJ Governor Phil Murphy’s Transition Committees

On February 6, 2018, we released a report entitled “Power Behind the Pipelines: PennEast Pipeline” that surveyed the powerful forces – the influential CEOs and directors, revolving door lobbyists, campaign

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On February 6, 2018, we released a report entitled “Power Behind the Pipelines: PennEast Pipeline” that surveyed the powerful forces – the influential CEOs and directors, revolving door lobbyists, campaign donors, and more – behind the PennEast Pipeline, a proposed 120-mile fracked gas pipeline that would cut across parts of Pennsylvania and New Jersey.

The report emphasized PennEast’s attempts to put itself in a position to influence the new administration of New Jersey Governor Phil Murphy. It profiled five registered lobbyists for the pipeline within the Murphy transition and discussed their and other PennEast lobbyists’ extensive revolving door ties.

New Jersey still must approve the pipeline, and Murphy has signaled that he wants to stand up to the fossil fuel industry. However, it’s unclear whether the governor will move forward on his stated vision for the state’s energy and environmental future by rejecting new oil and gas projects like PennEast. Our report showed that, even with his bold rhetoric and initial moves, Murphy is sending mixed messages due to the fossil fuel interests he’s brought into his transition.

Upon further research, the ties between the fossil fuel industry and the Murphy transition go even deeper than we initially reported.

Key Findings

PennEast attorney battling NJ townships is in Murphy transition

Pete Fontaine, the PennEast Pipeline Company’s attorney, was appointed to Murphy’s Environment and Energy transition committee. Fontaine is an attorney at Cozen O’Connor, a Philadelphia-based powerhouse international law firm. He is co-chair of the firm’s Utility, Environmental & Energy Practice Group and its Climate Change Practice. Cozen O’Connor is a member of the pro-fracking Marcellus Shale Coalition, whose members also include a PennEast owner and shipper. A 2013 article, which cites Fontaine and Cozen O’Connor’s ties to the coalition, quotes Fontaine defending a controversial bill that would allow drillers to use polluted water when fracking and which, opponents worried, would give drillers immunity from the hazardous consequences.

Fontaine’s company profile states that he serves as “environmental counsel to two natural gas pipeline projects,” which go unnamed. One of these pipelines is PennEast, while the other appears to be the South Jersey Gas Pinelands Pipeline. Fontaine has been at the forefront of PennEast’s efforts to gain access to the land within New Jersey townships.

For example, Fontaine sent an October 9, 2015 memorandum to New Jersey townships on behalf of PennEast to inform them that “survey crews will be accessing public rights-of-way” to survey “road crossing locations and boundaries for the pipeline project,“ and they had the legal right to do so. He warned that townships “do not have a right to restrict the right of survey crews” doing this and that “[a]ny effort to prohibit rightful access to use the public ROW for survey purposes is a violation of law.”

Some townships did not take kindly to Fontaine’s memo. Less than two weeks later, the Township of Kingwood in Hunterdon County responded to Fontaine that the statute he cited “does not give PennEast the right to use the Township right of way (or private lands) to perform its survey work.” The township told PennEast that it could seek a court order if it disagreed, and that, until then, “PennEast is on notice that the Township of Kingwood will not permit PennEast, its surveyors, employees or agents to enter any municipal property or municipal right of way.”

Delaware Riverkeeper also sent Fontaine a letter on October 29, 2015 that explained why “PennEast does not have the right” under the statute Fontaine cited “to enter into public rights-of-way or adjoining properties for purposes of surveying.” It asked that PennEast “cease and desist all efforts to assert otherwise.” Moreover, the Delaware Township passed a resolution on November 23, 2015, which it sent to Fontaine, that stated it did not approve of PennEast’s surveying activities, and it also requested advance notice of any flights over Townships, since such flights “alarm residents” and “terrify” livestock.

More recently, the NJDEP cc’d Fontaine in its February 1, 2018 letter to PennEast Pipeline Chair Michael Mara that notified PennEast of the Department’s denial of its water permit application. Mara has cc’d Fontaine in this June 21, 2017 letter to the DEP that asked for a 60 day extension on its application.

It also seems that Fontaine has worked for South Jersey Industries on its controversial proposed natural gas pipeline through the Pinelands Area. In a nine-page January 24, 2017 letter to the Pinelands Commission, Fontaine argued against the Commission’s assertion that the “the Pinelands Comprehensive Management Plan prohibits the construction of a natural gas pipeline through the Pinelands Area intended to serve needs outside the Forest Area and outside the state-protected Pinelands Area.” A range of emails from 2013 also shows correspondence between Fontaine – writing on behalf of the South Jersey Gas Pipeline – and the Pinelands Commission.

In short, Fontaine has been on the frontlines of pipeline companies’ attempts to access and build through state lands that oppose it. As battles heat up in New Jersey over PennEast’s resorting to eminent domain, it’s unsettling that Murphy has this pipeline attorney on his team.

Four PennEast executives & managers – including a former NJDEP official – in Murphy transition

Additionally, two top PennEast executives and two other top PennEast employees – a total of three from New Jersey Resources and one from South Jersey Industries – are in Murphy’s transition:

Finally, Ralph Izzo, the CEO of PSEG, has a spot on Murphy’s Environment and Energy committee. PSEG originally was a 10% owner of PennEast before it sold its share to Spectra, but it remains committed to PennEast as a shipper. Izzo also joined Phil Murphy’s delegation during the then Governor-Elect’s trip to Puerto Rico last December.

PennEast owner’s attorney from major fracking industry law firm on Murphy’s Environment and Energy Committee

Steve Genzer, a partner at the powerhouse law firm of Saul Ewing, Arnstein & Lehr, and the managing director of the firm’s Newark office, was appointed to Murphy’s Environment and Energy Committee. Genzer recently represented Southern Company, a 20% PennEast owner, in its acquisition of Elizabethtown Gas.

Genzer’s firm is deeply tied to the fracking industry. It is an associate member of the pro-fracking Marcellus Shale Coalition, whose board members include PennEast owner UGI and a PennEast shipper. The firm has represented gas companies and, in a 2014 article, was reported to have sent threatening eminent domain letters on behalf of the Constitution Pipeline.

Two Pilgrim Pipeline & PennEast owner lobbyists in Murphy transition

Murphy also appointed three lobbyists from the firm DeCotiis, FitzPatrick, Cole & Giblin. As we noted in our May 2017 report, DeCotiis is the main firm lobbying for the Pilgrim Pipeline in New Jersey.

The Pilgrim Pipeline is a proposed 178-mile double pipeline that would deliver fracked Bakken crude oil southward from Albany, New York to Linden, New Jersey, and refined oil products back northward. It’s estimated that it will carry 200,000 barrels per day in both directions – or 73 million barrels annually – and that the cost of pipeline construction will be around $1 billion. The pipeline proposal has sat in limbo for months and has sparked controversy and resistance, particularly from the Ramapough Lenape Nation in New Jersey.

Two of the DeCotiis lobbyists on Murphy’s transition are registered Pilgrim Pipeline lobbyists. Both of these lobbyists also recently registered as lobbyists for Spectra Energy, who is a 20% owner of the PennEast pipeline.

One lobbyist, Arlene Quinones-Perez, is on Murphy’s Budget transition committee. On February 12, 2018, she officially registered as both a Pilgrim Pipeline lobbyist and a Spectra Energy lobbyist.

The other, Joseph M. DeCotiis, is on Murphy’s Transition Counsel. DeCotiis was a Pilgrim lobbyist from November 24, 2014 to December 22, 2016. But DeCotiis just registered on February 15, 2018, to once again lobby for the Pilgrim Pipeline as well as Spectra Energy. DeCotiis is tied to the New Jersey Democratic Party – he was appointed to the Democratic National Committee in 2007 and has previously served as a member of the New Jersey Democratic State Committee.

Murphy BPU Chief of Staff & Environment and Energy committee transition appointee was lobbyist for natural gas company

Grace Strom Power was named to Murphy’s Environment and Energy transition committee and was appointed chief of staff of the Board of Public Utilities under Murphy. Before this, Power worked for the Feller Law Group, which describes itself as a “a full-service law firm serving highly regulated industries.”

Power was a lobbyist for Direct Energy, an electricity and natural gas company, during 2017; her registration to lobby for the company was terminated on February 9, 2018. Strom filed three lobbying reports on July 7 and October 10, 2017 and January 1, 2018 that show she lobbied New Jersey state legislators on behalf of Direct Energy around issues that including BPU regulation and natural gas. Now, just months later, she’s in a position of regulatory influence over the industry she lobbied for.

A 2016 profile of Power stated that “[a] substantial portion of her practice is devoted to representing and advising electric and natural gas suppliers with all facets of policy, regulatory, and compliance issues. She serves as outside counsel to numerous energy retail suppliers, including one of North America’s largest energy and energy-related services providers, advising on all facets of regulatory and compliance issues impacting day-to-day business operations.”

Power also made a single donation of $2,000 to Murphy’s gubernatorial campaign on September 30, 2017.

In total, Murphy appointed at least 16 individuals to his Environment and Energy transition committee who are tied to the fossil fuel industry.

In addition to the six fossil fuel-tied members of Murphy’s Environment and Energy transition committee we’ve identified in this report – Fontaine, Ellis, Sperrazza, Izzo, Genzer, Power – and the PennEast lobbyist David Smith we identified in our prior report, we found nine other individuals who were appointed to this committee who have oil and gas ties, and some with ties to PennEast:

Additionally, Murphy appointed two other individuals with ties to the fossil fuel industry to his transition: