A look back at the Cooper administration’s Atlantic Coast Pipeline controversy

Independent report found Cooper manipulated the permit process; $57.8 million never materialized

FILE - This Feb. 8, 2018, file photo shows signs that mark the route of the Atlantic Coast Pipeline in Deerfield, Va. The developers of the now-canceled Atlantic Coast Pipeline have laid out plans for how they want to go about unwinding the work that was done for the multistate natural gas project and restoring disturbed land. In a filing with federal regulators made public Tuesday, Jan. 5, 2021, the pipeline company proposed an approximately 24-month timeline for efforts across West Virginia, Virginia and North Carolina. (AP Photo/Steve Helber, File)

RALEIGH — Earlier this month, Dominion Energy and Duke Energy announced the cancelation of the Atlantic Coast Pipeline (ACP) project, which had generated years of controversy in North Carolina. The ACP cited court decisions and possible delays as key reasons for ending the project.

Over the last two years, a number of legal challenges to the project’s permits, both state and federal, have increased project costs from $4.5 billion to $5 billion to $8 billion. In addition, the project’s estimate of commercial in-service had been pushed to 2022, which is almost a three-and-a-half-year delay.

The ACP was supposed to bring an estimated 17,000 jobs and $2.7 billion of construction economic activity. Around 2,200 long term jobs were expected to come out of the ACP along with annual local property tax revenue of $28 million.

Construction on the ACP voluntarily halted in December 2018. Counties that would have seen activity in North Carolina included Cumberland, Halifax, Johnston, Nash, Northampton, Robeson, Sampson and Wilson. Cooper and his family members own properties in an area of Nash County where the pipeline would have run through. The governor owns two properties totaling 44 acres, while his brother, Pell, owns 13 properties totaling approximately 375 acres.

The ACP has caused controversy within the state after the revelation of a $57.8 million dollar “mitigation fund” that would be placed in an escrow account chosen and controlled by Cooper. The mitigation fund, which was detailed in a Memorandum of Understanding (MOU), would come to be characterized by some as a political slush fund. The Cooper administration referred to it a “voluntary contribution,” however, Rep. Pricey Harrison (D-Guilford) stated that the MOU was “a condition of getting the permit granted.”

Donald van der Vaart, a former secretary of the N.C. Dept. of Environmental Quality who now serves on the state’s environmental rulemaking commission, proposed a rule this month that would make situations where money is exchanged for permits illegal.


The history of the ACP starts in 2014, with AGL Resources, Dominion Energy, Duke Energy and Piedmont Natural Gas forming the Atlantic Coast Pipeline, LLC. In mid-September 2015, the ACP filed an application with the Federal Energy Regulatory Commission to build the pipeline. The FERC approvals did not come through until October 2017.

The project moved along over the next few years and on May 9, 2017, ACP filed for the required Water Quality Permit with DEQ.  The following month, in June, Cooper hired Jeremy Tarr as a policy adviser on energy, the environment and natural resources. Tarr previously worked at the U.S. Environmental Protection Agency. Cooper tasked Tarr to get an updated timeline from DEQ for the ACP’s permit on Aug. 17, which he does, with a copy reaching Cooper’s senior adviser Ken Eudy on Aug. 21. The memo is also shared with Cooper’s campaign adviser, Morgan Jackson of Nexus Strategies.

At the end of August 2017, Tarr emails Cooper’s chief of staff, Kristi Jones with permit information and details about a company called Strata Solar and its CEO, Markus Wilhelm. Cooper and Wilhelm have a conversation sometime thereafter about Duke Energy and solar power deal possibilities. Several months later, on Nov. 28, a memo from DEQ was received by Jones that discussed “ACP mitigation options.” Among the suggestions was an increase in the amount of solar energy purchased by Duke.

On Nov. 30, 2017, Cooper meets alone with Lynn Good, the CEO of Duke Energy. This meeting could be seen as an opportunity for a quid pro quo. Eagle Intel Services, the independent investigators later hired by the General Assembly, would report that Good told her staff to find a way to resolve the solar issues with Duke and create a mitigation fund for Cooper the day after she met alone with him. According to the report, Cooper had tied the ACP permit, the mitigation fund, and resolution of the Duke dispute with solar companies together in his meeting with Good.

As reported by Carolina Journal, Cooper had personal dealings with Strata Solar for a number of years. As of April 2019, Cooper’s sister-in-law Meredith Cooper has been listed as manager of the company that owns the Cooper family’s Nash County solar farm property. Carolina Journal’s Don Carrington wrote that, “This is the fourth ownership arrangement since 2012 of a 40-acre site in Nash County where a 5-megawatt solar farm leased to Durham-based Strata Solar LLC resides.”

Emails included in the ACP investigation from early December 2017 show National Governors Association staffer Sue Gander advising Tarr about the ACP and warning him that stipulating a fund tied to permits could be seen as extortion and raise “due process issues” and “ethical” concerns.

The final version of the MOU is sent on Dec. 13 by Duke Energy lobbyist Kathy Hawkins, and on Dec. 29, Cooper’s legal counsel William McKinney sends a text to Eudy saying Duke wants to sign the MOU on Jan. 2, 2018. However, early on the morning of Jan. 1, McKinney and Eudy text back and forth about delaying signing the MOU in order to leverage a “solar deal,” which is a reference back to the meetings involving Good and Wilhelm.

McKinney texted to Cooper and Eudy he was set to sign and Cooper asked, “It’s what we discussed earlier right?” McKinney said yes and Cooper then texted, “Where are the solar boys on their deal?” In the same series of texts, Eudy said, “Not sure we should sign ACP agreement unless solar deal works.”

Media coordination and messaging were addressed in a Jan. 22, 2018, text message between Eudy and Sadie Weiner, Cooper’s senior communications director. Eudy asked about the possibility of a “selected pre-announcement media background briefing.” Weiner replied that she loved the idea, “but I’m not sure our press corps understands or appreciates those. But assuming solar comes together we will need to pick a reporter to share that with and bring him or her in to sit down with you to understand wtf it’s all about.”


On Jan. 25, the ACP MOU, including the $57.8 million mitigation fund, is privately signed by McKinney acting as an authorized agent for the governor. The next day, on Jan. 26, the ACP’s Water Quality permit approval is announced by DEQ and Cooper announces the MOU.

Three days later, lawmakers begin questioning the MOU and the legality of Cooper controlling the mitigation fund. The same day, on Jan. 29, Cooper announces that Duke Energy and solar companies in the state have resolved their issues and have reached a new agreement for working on future projects.

In February, the General Assembly quickly passes a bill redirecting the $57.8 million fund to school districts that would be impacted by the pipeline. Lawmakers also begin inquiries into the MOU and send questions to the governor.

A subcommittee, co-chaired by Sen. Harry Brown (R-Onslow) and Rep. Dean Arp (R-Union), is created on Sept. 6 to investigate the MOU and ACP permit process. In mid-December, after months of stonewalling from Cooper and Jones, private investigators are hired to conduct interviews and obtain documents. Just before Christmas, Cooper’s office dumped around 40,000 pages of ACP-related materials, including emails.

In 2019, lawmakers sent several letters requesting Cooper’s office cooperate with investigators, turn over materials and allow staff to be interviewed. It was not until October that Cooper, through Jones, responded by rejecting investigators access to employees involved with the fund or ACP process. Brown and Arp sent a response directly to Cooper, slammed him for obstructing the investigation and gave him three options: let employees speak, designate certain staff including the governor himself to testify or the legislature will subpoena the individuals needed to close the investigation. A few days later, Cooper changed course and would allow certain staff members to testify before the subcommittee.

Hearings were held throughout October 2019, but it would not be until November 2019, that lawmakers would wrap up interviews related to the ACP investigation. In a letter dated Oct. 21, the ACP co-chairs requested testimony from the governor and three high-level members of his staff. Cooper’s senior adviser, Ken Eudy, and deputy chief of staff Julia White were both in attendance at the meeting, but Cooper and McKinney were both absent.

On Nov. 8, 2019, Eudy testified before the ACP subcommittee and said he did not ask Duke for a statement declaring the fund was voluntary.

“Did you ask Duke to provide a statement regarding the voluntary status of the MOU and fund?” Brown asked Eudy, to which Eudy responded, “No, Sir.”

Eudy’s testimony conflicts with the independent investigator’s ACP report that documented a call by Eudy to Duke’s lobbyist Kathy Hawkins on Feb. 8, 2018, during which he requested Duke prepare a letter stating the $57.8 million fund was “voluntarily” provided on behalf of the ACP. Hawkins affirmed she told Eudy that they “were not doing that.”

The independent investigator’s findings concluded that Cooper “improperly used the authority and influence of his office” to pressure natural gas pipeline builders to agree to a $57.8 million mitigation fund under his control. The report, however, found no evidence that the governor had personally benefited from the fund. The day after the findings were published, Lt. Gov. Dan Forest called for the FBI’s Public Corruption Unit to investigate the matter.


As for the $57.8 million, not a dime of it actually landed in North Carolina. The first half of the payment would have been made had the final federal approval for the project come through. Since those approvals were on hold, the funds were not disbursed.

“In the coming months we will engage with each of the states to determine the best path forward for the mitigation agreements and funding,” Aaron Ruby, manager of Media Relations for Dominion Energy, replied in response to North State Journal’s inquiry.

“It’s disheartening to see the Atlantic Coast Pipeline not come to fruition,” said Sen. Danny Britt (R-Robeson) told NSJ. This project would have been transformative for Eastern North Carolina, providing an economic boost for existing industries and creating new jobs and much-needed infrastructure. Gov. Cooper has said he’s for economic growth in rural North Carolina, except of course when the growth is politically inconvenient for him.”

About A.P. Dillon 1213 Articles
A.P. Dillon is a North State Journal reporter located near Raleigh, North Carolina. Find her on Twitter: @APDillon_