Two notable developments in the past few weeks signal potential changes ahead to the policies and timeframes for pipeline approvals, particularly natural gas pipelines under Federal Energy Regulatory Commission (“FERC” or the “Commission”) oversight. These developments reflect both the increased public scrutiny of the pipeline approval process seen in recent years and the emphasis placed by the current administration on expediting review and approval of major infrastructure projects, two factors that are in some tension with each other. Continue Reading Recent Developments Signal Changes for Content and Timing of Pipeline Reviews
On March 12, 2018, the United States Court of Appeals for the Second Circuit affirmed a Federal Energy Regulatory Commission (FERC) order finding that delays by the New York Department of Environmental Conservation (NYDEC) in reviewing Millennium Pipeline Company’s application for water quality certification constituted waiver of NYDEC’s authority under the Clean Water Act (CWA). As we detailed in an earlier blog post, FERC found that NYDEC’s delay exceeded the one-year statutory period established by CWA Section 401. The Millennium case is just one of several interstate natural gas pipeline projects that have faced delays associated with the CWA Section 401 permitting process. (See, e.g., Atlantic Bridge Project, Atlantic Sunrise Project, Constitution Pipeline, Northern Access Project, PennEast Pipeline, and Spire STL Pipeline.) The Court’s decision resolves the nearly three-year permitting process for the Millennium Valley Lateral Pipeline and clarifies for other projects (and state agencies reviewing those projects) that the one-year waiver period begins when the state agency receives the initial request for certification. Continue Reading Second Circuit Affirms Waiver Period for State Water Quality Certification Begins Upon Receipt of Request for Certification
Federal agencies that authorize or permit large infrastructure projects, like interstate natural gas pipelines, are often subject to the requirements of the National Environmental Policy Act (NEPA), and environmental organizations frequently rely on NEPA to challenge a project. The D.C. Circuit recently struck down a decision by the Federal Energy Regulatory Commission (FERC) to approve the construction and operation of three interstate natural gas pipelines because the Court found defects in FERC’s NEPA analysis. The court’s decision to vacate FERC’s authorization now threatens to shut down the pipelines, including the Sabal Trail pipeline currently supplying natural gas to newly constructed power plants in Florida.
On January 31, 2018, in proceedings to condemn easements for the Mountain Valley Pipeline project, the US District Court for the Western District of Virginia ruled that the pipeline company’s preliminary injunction motions for pretrial possession of the easements would be granted only if it appraised each of the nearly 300 properties at issue.
On January 11, 2018, the Federal Energy Regulatory Commission (FERC) denied Constitution Pipeline Company, LLC’s Petition for a Declaratory Order that New York had waived its ability to act under section 401 of the Clean Water Act (CWA) by failing to grant or deny Constitution’s application for a section 401 certification within a “reasonable period of time.” See In re Constitution Pipeline Co., LLC, 162 FERC ¶ 61,014 (Jan. 11, 2018). The decision is another in a sequence of decisions from FERC and the federal courts of appeals concerning the time period for States to act under section 401.
The Federal Energy Regulatory Commission (FERC or the Commission) announced last month that it will review its policies governing the certification process for natural gas pipelines. The announcement was made by FERC Chairman Kevin J. McIntyre on December 21, 2017, in fulfillment of a pledge that he made during his Senate confirmation hearing in September 2017. The format and scope of the review are still being determined. Continue Reading FERC to Review Natural Gas Pipeline Certification Policies in the New Year
Recent months have seen the appointment and confirmation of top posts in key pipeline regulatory agencies, the Federal Energy Regulatory Commission (FERC) and the Pipeline and Hazardous Materials Safety Administration (PHMSA). While developments are generally good news for the pipeline industry—in that they are likely to mean expeditious project approvals and a clear chain of command at the agencies—the past few weeks have seen interesting departures from past practices, as discussed in more detail below.
On September 15, 2017, the Federal Energy Regulatory Commission (FERC or the Commission) issued an order in which it concluded that delays by the New York Department of Environmental Conservation (NYDEC or the Department) in processing Millennium Pipeline Company’s application for Clean Water Act (CWA) water quality certification constituted a waiver of the certification requirement. The order resolves a lengthy saga regarding water quality certification for Millennium’s Valley Lateral Project. It reaffirms previous FERC precedent establishing that the one-year waiver period for CWA water quality certification decisions by state agencies begins when the state agency receives a written application for certification, regardless of the state agency’s determination that the application is incomplete or requests for further information.
Recently proposed legislation in the U.S. House of Representatives would require FERC to revise its review process for proposed natural gas pipeline expansion projects to include additional analysis of cumulative impacts in a single region or State and extended environmental monitoring. While this bill is unlikely to gain traction in the Republican-controlled House, it is indicative of an ongoing debate about the need for and environmental impacts of new pipeline construction, and the role of both federal and state regulators in reviewing and approving such projects—a debate that has attracted national attention in the wake of the Obama administration’s rejection of the Keystone XL project in late 2015.
FERC recently published a revised draft Guidance Manual for Environmental Report Preparation for review and public comment. The revised Guidance Manual updates FERC’s 2002 guidance manual on environmental report preparation for projects seeking FERC authorization under the Natural Gas Act (NGA), supplementing the previous guidance as well as adding new sections explaining requirements for environmental report preparation. This substantial enhancement of the Commission’s 2002 guidance likely reflects increased scrutiny by environmental groups and others of FERC’s compliance with its NEPA obligations in authorizing natural gas and LNG projects.