Dane County Drops Effort To Have Enbridge Insure Against Oil Spills

An energy firm will be able to increase the amount of oil being sent across the state through one of its pipelines, after a Dane County committee decided to not revoke a permit granted to the firm for its expansion there.

Enbridge Energy received a permit to build a pump station in April as part of plans to send up to 1.2 million barrels per day through its Line 61 pipeline. That permit required Enbridge to obtain special environmental insurance to pay for cleanup of potential spills. However, the recently passed state budget included a provision that prevented the county from requiring the insurance.

Dane County Zoning Committee Chair Patrick Miles said they’re not moving forward with an environmental group’s proposal to revoke the permit and reissue a new one that would instead require Enbridge to have a trust fund.

“I think I can safely speak for the whole committee: We all wish we could have done more, but the state Legislature stepped in and usurped what authority we did have,” saud Miles.

The committee came to the decision at Tuesday’s meeting after hearing from the county’s corporation counsel David Gault. In a letter outlining his opinion, Gault argued that case law would support the assertion that Enbridge has vested rights in the conditional use permit, and that therefore, it couldn’t be revoked by the committee.

Peter Anderson with the environmental group 350 Madison — the organization that petitioned the county to consider rescinding the permit and pursue the trust fund option — disagreed with Gault’s opinion. Anderson contended Enbridge wouldn’t be able to argue vested rights in this circumstance.

“It’s not a building permit where rights and entitlements arise. This is a conditional use permit in an area they’re not supposed to be in, and they can only be in it if conditions are imposed sufficient to offset the damage they will create,” said Anderson.

In his opinion to the committee, Dane County’s corporation counsel also cited a consultant’s findings that Enbridge had sufficient financial resources to pay for any potential spill at this time. Anderson said Gault failed to highlight the consultant’s recommendation that the county obtain financial assurance from Enbridge should the company’s financial standing change over time.

Enbridge Stakeholder Relations Manager Jennifer Smith said they’re moving forward with construction, which is already underway at the station.

“In terms of the call for a trust fund, it just isn’t necessary for the same reason that the environmental insurance wasn’t necessary,” said Smith.

Smith noted that Enbridge carries $860 million in general liability insurance. However, critics have argued that Enbridge has been involved in ongoing litigation about its coverage for unrecovered costs related to the Kalamazoo River Spill in 2010. Smith said they’ve invested billions of dollars to upgrade technology to ensure safety of their pipelines since then.

“If anything were to occur with our system in Dane County, Wisconsin or anywhere else across our system, we’ll take responsibility,” she said. “We’ll respond, and we’ll bear the cost.”

Meanwhile, Miles said he’ll continue to explore any policy changes the committee could make to address risks with pipelines within the confines of federal and state law.