Minnesota utility regulators pass measures to reapprove the proposed $2.6 billion Enbridge pipeline

State utility regulators Monday reapproved a controversial pipeline Enbridge wants to build across northern Minnesota, putting the Canadian company closer to starting the long-delayed project.

First, the Minnesota Public Utilities Commission (PUC) voted 3-1 to approve a revised environmental review for the pipeline, saying it adequately assessed the effects of an oil spill in the Lake Superior watershed. Then by the same vote, the PUC reapproved the certificate of need and route permit for the proposed 340-mile pipeline, which would replace Enbridge's aging Line 3.

"We are very happy with the outcome today," said Barry Simonson, the new Line 3 project director for Enbridge. "This has been a five-year process for the Line 3 replacement project."

Simonson declined to speculate on when Enbridge expects to begin construction on what would be one of the largest construction projects in recent Minnesota history.

But the publicly traded company — whose investors are clamoring for the added profits from a new pipeline — would likely begin construction in the spring if it secures the rest of its permits.

The PUC's Line 3 approval Monday doesn't go into immediate effect. Opponents have a few weeks to file "reconsideration" petitions with the PUC, which are likely to be denied. The PUC then must write a formal order.

Enbridge also must still receive project permits from the Minnesota Pollution Control Agency, the state Department of Natural Resources and the U.S. Army Corps of Engineers.

Supporters have pointed to the thousands of construction jobs the $2.6 billion project would create, as well as the improved safety the pipeline would provide. Opponents said the pipeline would worsen climate change and threaten a new region of Minnesota lakes and rivers with a crude-oil spill.

The three main environmental groups opposing Line 3 — Friends of the Headwaters, Honor the Earth and the Sierra Club — are all expected to appeal the PUC's Monday approvals.

Winona LaDuke — head of Honor the Earth, a Minnesota-based indigenous environmental group — said construction crews on the new pipeline project would be met with "water protectors," a term opponents use for pipeline protesters.

"We will not let them go through with this," said Raymond Auginaush Sr., a member of the White Earth Nation tribal council.

The White Earth, Red Lake and Mille Lacs bands of Ojibwe all have opposed the Line 3 project. The Leech Lake Band of Ojibwe supports the project because it wants the current Line 3 taken off its land; the new pipeline will not go through its reservation. The Fond du Lac Band of Lake Superior Chippewa has opposed the project, but faced with what it called two bad choices, it made a settlement with Enbridge to allow the company to put the pipeline through its reservation.

The new pipeline would replace Enbridge's 1960s-vintage Line 3, which is corroding and operating at only 51% capacity because of safety issues. The new Line 3, an artery to Alberta's oil fields, would follow Enbridge's existing corridor of pipelines across northern Minnesota to Clearbrook. But from there, it would forge a mostly new path to Enbridge's terminal in Superior, Wis.

The issue was back in front of the PUC because the Minnesota Court of Appeals in June shot down the panel's approval of the first environmental impact statement (EIS), saying the Minnesota Department of Commerce — which conducted the EIS — didn't properly review the effects of a potential spill on the St. Louis River estuary and ultimately Lake Superior.

After further review, Commerce concluded a potential spill in the watershed would be unlikely to reach the lake itself. Environmental groups contest that finding, saying the department also should have assessed some rivers in Wisconsin that are closer to Lake Superior.

Monday's decisions came from a slightly different PUC board than the one that voted to approve the project in 2018. The term of one commissioner, Dan Lipschultz, expired in January, and Gov. Tim Walz has yet to appoint a replacement. Lipschultz had approved the initial EIS and the pipeline itself in 2018.

The vote was the first chance Commissioner Valerie Means, who was appointed over the past year, to express her views on the project. She voted to approve Line 3 and the revised environmental review.

"This pipeline poses significant integrity issues and poses a safety risk," Means said. "I think replacing an old pipeline with a new pipeline is the most rational option."

PUC Chairwoman Katie Sieben and Commissioner John Tuma both also voted in favor of the project.

Matt Schuerger, who originally approved Line 3 in 2018, voted against a certificate of need and also against the revised EIS, saying it did not properly assess potential spills in the Lake Superior watershed.

As for the certificate of need, Schuerger said there have been significant changes since June 2018, particularly around climate change. Minnesota's greatest climate-change threat has become transportation, he said, citing state climate-change data showing that electric utilities are no longer the greatest source of carbon emissions in Minnesota. Petroleum-powered vehicles are. The state, policywise, has moved further toward electric vehicles in the last 18 months.

"We have significant evidence the transportation is going to move — and move quickly — to electrification," Schuerger said.

Sieben told Schuerger: "I don't fundamentally disagree with any of your conclusions, especially around climate change. … But this decision is not just about climate. The reality in northern Minnesota is a deteriorating, decrepit old pipe."

Schuerger also questioned the long-term oil demand forecasts for the new Line 3 given expectations of electric vehicle adoption over the coming decades. "The absence of a clear, transparent forecast of demand is a significant flaw, and I believe it is now a fatal flaw."

The Minnesota Commerce Department has long maintained that Enbridge's forecasts are inadequate, and an attorney representing the department said that on Monday.

Means disagreed. "I believe the record provided a robust analysis of demand," she said.

The Commerce Department did its watershed spill modeling to revise the EIS on a pipeline crossing at Little Otter Creek in Carlton County, where a spill in Minnesota would be most likely to enter the St. Louis River and reach the lake. In a "full-bore" rupture at Little Otter Creek, oil would likely accumulate on the river's shores "but without reaching the entrance to Lake Superior," according to the revised EIS.

Mike Hughlett • 612-673-7003