LG&E takes Bernheim to trial over proposed natural gas line in Bullitt County
Environmental advocates packed a courtroom in Bullitt County ahead of arguments over Louisville Gas and Electric and Kentucky Utilities’ plan to condemn conservation lands owned by Bernheim Arboretum and Research Forest.
Kentucky’s largest utility has already acquired most of the land necessary to build a 12-mile-long natural gas pipeline to improve capacity and reliability in northern Bullitt County.
To build it, LG&E would need to cross through Bernheim’s Cedar Creek Wildlife Corridor, cut down nearly 40 acres of forest, cross major waterways and impact habitat for threatened and endangered species including the Indiana bat and Kentucky glade cress.
LG&E is still missing critical state and federal permits, but is moving forward with the eminent domain action against Bernheim.
Representatives of the utility, Bernheim and the Kentucky Heritage Land Conservation Fund appeared before Bullitt County Circuit Court Judge Rodney Burress on Tuesday. He will ultimately make the decision of whether to turn over the lands to LG&E for construction of the pipeline.
As LG&E Attorney Monica Braun noted in her opening statements, Burress has already given the utility the right to take land in seven other cases associated with the pipeline. Braun declined an interview for this story.
Following the first day in court, Bernheim Executive Director Mark Wourms said their attorneys laid out good, simple arguments while pointing out the flaws in LG&E’s position.
“My biggest concern is one, if indeed they are successful, we will lose some incredible endangered species’ habitat, we’ll pollute some incredibly clean springs and streams and we will pump hydrocarbons for 70 years, which we just can’t afford to do with the climate crisis,” he said.
Dozens of people filled the courtroom to hear opening arguments. Kat Smith, an organizer at the Kentucky Student Environmental Coalition, said they counted nearly 100 people showing support in the courtroom and outside. Many wore black and yellow shirts saying “Save Bernheim Now, stop the LG&E pipeline and the climate crisis.”
“I think there’s a lot of people that would be directly impacted in this state, but also I think a lot of us really care about a brighter future for our own lives and for future generations,” Smith said.
LG&E’s opening arguments
Regulators at the Kentucky Public Service Commission first approved LG&E's pipeline in 2017 as part of a utility rate case, but the proposed route wasn’t made clear until 2019. That’s because LG&E asked utility regulators to shield the proposed route from public scrutiny arguing it would create a “competitive disadvantage,” according to a filing with utility regulators.
In opening arguments, LG&E attorney Monica Braun said the judge needed only to answer one question: Is there a public use for this pipeline? She argued the answer is a resounding yes.
“We are not able to accept any new customers to our pipeline service in Bullitt County,” LG&E Chief Operating Officer Lonnie Bellar testified.
Bellar said capacity is so tight on the existing gas line that LG&E has a backlog of more than 600 requests for service including from hospitals, fire departments, businesses and residential subdivisions.
Bellar also said the pipeline is needed to improve the reliability for 10,000 customers in northern Bullitt County, though under cross examination he noted that he had not seen an interruption in service there in his three decades at LG&E.
LG&E initially estimated the pipeline would cost $28 million, but the prediction has ballooned to $74 million, Bellar said. If the project goes through, the Public Service Commission would decide who pays for the pipeline.
The commission could choose to recover the costs from LG&E shareholders or ratepayers, though ordinarily it’s ratepayers that foot the bill in these instances.
During the hearing, attorneys for Bernheim focused on when and why LG&E decided to include the pipeline construction in a 2016 rate case.
Jim Beam needed natural gas
As LPM News previously reported, Beam Suntory approached LG&E about an increased need for natural gas in 2015, according to a timeline assembled last June by Kevin Smith, vice president of public affairs for the company, which owns brands like Jim Beam and Maker’s Mark.
At the time, LG&E responded there wasn't enough gas available on the current line. The utility then asked Beam Suntory to pay for a new pipeline at an estimated cost of $20 to $25 million, records show, though the company rejected the proposal.
In court Tuesday, Bellar testified that the utility was aware of the gas needs in the region for years before they decided to move forward with the project.
Bernheim attorney Tom FitzGerald questioned Bellar about the timing of the project in relation to the negotiations with Beam Suntory.
“Obviously, I can't give you a conclusive answer, but concerns about reliability and capacity in the area had been growing for some time,” Bellar said.
Bellar said he was unaware what percentage of the pipeline’s capacity would go to Jim Beam at that time. He also said that Jim Beam does not currently have a service request to use the proposed pipeline if it comes to fruition.
Taking state land
Another issue at stake in the case is LG&E’s use of eminent domain to take land that is, in part, owned by the state.
Bernheim purchased the nearly 500-acre Cedar Creek Wildlife Corridor in 2018 for about $1.4 million to serve as a wildlife corridor and protect natural habitat for endangered species, including Indiana and northern long-eared bats.
The Kentucky Heritage Land Conservation Fund paid about half the cost for the wildlife corridor — $706,500 — in exchange for the conservation easement, which limits land uses to preserve natural areas.
In court Tuesday, Kentucky Heritage Land Conservation Fund Attorney Matthew Myers told LPM News they are legally defending their property interests.
“There is so little land conserved globally, nationwide and especially in Kentucky that any impingement upon conserved land is extremely troubling,” Myers said. “We have so little and they’re trying to take what little we have, some of what little we have.”
The court case continues Wednesday at 8:30 a.m. It’s unclear when the judge could make a decision on the case.