Local Study Disputes Benefits of Palmetto Pipeline

Assessment of economic impact analyses of the Palmetto Pipeline_030816

Read more about studies commissioned by Kinder Morgan here.

There are no real savings to the consumer,” says Richard McGrath, Economics Professor at Armstrong State University.

He’s talking about a new study done on the benefits of the Palmetto Pipeline done by himself and Michael Toma who is also a professor at Armstrong.   McGrath says he and Toma were asked to critique studies released about two months ago that were commissioned by Kinder Morgan.  “And to consider whether or not the very large numbers used in those reports were reasonable and we found a number of different things that bothered us,” McGrath said.

The new study says economic benefits outlined in the Kinder Morgan studies are unrealistically optimistic in all areas from the number of actual local jobs to the number of jobs that might actually be lost. “The other reports didn’t  make any mention of jobs lost that if you’re going to replace trucking jobs with pipeline jobs you’re going to lose trucking jobs,” he told us.

the report says at least 120 trucking jobs in Georgia would be lost. And that cost savings at the pump would not be that great.  “A lot of their claims were predicated on this big decrease in price that when you look at the prices Kinder Morgan is going to charge to use the pipeline won’t move on to consumers – that just money Kinder Morgan will capture,” said McGrath.

McGrath says the study also indicates that two major suppliers would have the cost savings from the pipeline and that that would not create competition locally.

“So this looks very much to me as an economist like they’re trying to justify to us having a pipeline that runs through here with no promise they will ever actually open the Richmond Hill terminal, but that the pipeline will go all the way to Jacksonville, Florida and it’s my professional opinion that’s where the fuel’s going as well,” he said.

 

 

 

 

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