By Keith Brown | For NJ.com • Posted Nov 04, 2015 | Updated Jan 17, 2019
PennEast has overestimated by two-thirds the number of jobs it would create to build its proposed 118-mile natural gas pipeline, according to a new study commissioned by pipeline opponents.
The New Jersey Conservation Foundation, a vocal opponent of the proposed $1.2 billion pipeline, held an afternoon conference call to announce the study, which analyzed PennEast’s economic benefit analysis released in February.
The proposed pipeline, under consideration by a federal agency, would support around 4,000 jobs for the project, not 12,160 jobs that PennEast has said it would support, according the study.
“The PennEast jobs claims are heavily inflated and based on faulty assumptions,” Tom Gilbert, of the New Jersey Conservation Foundation, said. “The bottom line is the information can’t be trusted.”
The PennEast jobs number is based on an assumption that 10.7 jobs would be created for each $1 million of the total project cost, according to Ian Goodman, founder of The Goodman Group, which conducted the study.
Similar pipelines estimate between 8-36 percent of the PennEast jobs estimate, Goodman said.
“PennEast significantly overstates these jobs by about 2/3 or more,” Goodman said.
Patricia Kornick, spokeswoman for PennEast, stood by the PennEast numbers Wednesday.
“Our study was done by a reputable company and it is well-documented that pipelines are strong job creators,” Kornick said. “We will be supporting more than 12,000 jobs.”
PennEast, a consortium of natural gas companies that includes all four New Jersey gas providers, in September filed its formal application to the Federal Energy Regulatory Commission, which regulates pipelines that cross state lines. The PennEast proposal calls for a 36-inch pipeline from the Marcellus Shale region of Northeast Pennsylvania to Hopewell Township. PennEast has said the pipeline would deliver enough natural gas to heat 4.7 million homes and would reduce natural gas costs to consumers in Pennsylvania and New Jersey.
No timeline was immediately available for the FERC approval process, but PennEast has said the company expects to start construction, if approved, in 2017.
PennEast in February touted a study co-authored by Drexel University’s business school that said the pipeline would support 12,160 jobs during construction, with $740 million in wages. The pipeline would also support 98 jobs – 10 in New Jersey and 88 in Pennsylvania — and generate $23 million in economic activity annually. The bulk of the economic windfall would be felt in the four Pennsylvania and two New Jersey counties where the pipeline is proposed, according to the study.
Kornick later said 9,960 jobs cited in the Drexel study are ancillary positions created by the $1.6 billion in economic activity generated by the construction.
For instance, if the operator of a taco truck pulled up to a construction area to feed hungry workers at lunchtime, that operator would be counted as one of the 12,160 jobs “supported” by the a pipeline, under the formula employed by the Drexel study.
Municipal opposition to the PennEast proposal has been widespread in New Jersey. Every town through which it is proposed to travel has adopted resolutions against it, including Mercer County government.
The 71-page study released Wednesday was conducted from August to October, at a cost to the foundation of about $40,000, Gilbert said.