Study Finds PennEast Pipeline Inflated Claims of Job Creation

The Controversial PennEast Pipeline that would cut across farmlands and preserved open space doesn’t even have federal approval yet. What it does have is a battalion of powerful supporters, and a long line of detractors which includes the New Jersey Conservation Foundation. It hired the same company that analyzed the contested Keystone XL Pipeline to analyze PennEast’s claims of economic benefits. Tom Gilbert is with the New Jersey Conservation Foundation.

The Goodman Group which did the study found the economic benefits they claimed were inaccurate. “What the study found was that PennEast claims of jobs that would be created through creation of the pipeline are inflated by a factor of three or more,” Gilbert said. “Furthermore the report noted a number of real inconsistencies. The main difference is that PennEast assumed a jobs multiplier that is much higher than, and out of line with the multiplier from similar gas pipeline projects in the northeast.”

Other key findings were that the jobs created would be very short term in nature; about five months in duration. “50 percent or more of the jobs would actually be outside of New Jersey and Pennsylvania because a lot of these jobs require special skills and there are workers that come in from all over the country,” he said.

Gilbert says the Goodman Group’s analysis varied so drastically from PennEast’s analysis because of flaws in their methodology. “They assume a jobs multiplier of over 10 jobs per million dollars of investment which other similar studies have used multipliers that are only eight to 36 percent of that number. So it really calls into question the validity,” he said.

He said PennEast “significantly overstated” the economic benefits of the pipeline construction on New Jersey by two-thirds or more. “We think this study shows and discredits one of the main justifications that they’ve provided for this project, and it doesn’t warrant the environmental impacts,” he said. “There’s over 4,000 acres of tax payer supported open space, 31 of the cleanest streams in the state and there would also be significant taking of private property from homeowners.”

PennEast argues the pipeline will lower heating costs for New Jersey residents. While the study didn’t include analysis on that aspect of the pipeline, he says there’s lot of other evidence to suggest that it will not make any difference. “New Jersey already enjoys very low gas prices. There’s a surplus of gas,” Gilbert said. “Another study found that the PennEast Pipeline would be 53 percent more gas than is needed in the region, so we really don’t need more gas. Gas prices are already low.”

Is this report enough to halt the construction of the PennEast Pipeline? Gilbert says it’s just one more piece of evidence in opposition. “I think it’s another piece of compelling evidence in combination with the really overwhelming public opposition. There are over 1,400 interveners in the Penn East application before the FERC [Federal Energy Regulatory Commission]. Every community along the path of the pipeline is opposed. There’s bipartisan opposition from our state and federal elected representatives,” he said.