January 2016 Vol. 71 No. 1
Washington Watch
FERC's Policy On ‘Cumulative’ Impact Of Pipeline Projects Faces Tests
FERC’s Cumulative Impact Policy
The Federal Energy Regulatory Commission issued its long-awaited decision clearing a Tennessee Gas Pipeline Co. project in Pennsylvania shale country after a federal court had forced the agency to revisit an environmental assessment FERC performed in 2012.
The FERC order issued in November on the Delaware Riverkeeper case did a deeper dive into the environmental impact of the Northeast Upgrade Project when considered with the cumulative impact of three other Tennessee Gas projects in the same area. The order, issued on Nov. 19, 2015, establishes a precedent that both pipelines and their opponents are already citing, and for opposite reasons.
Richard Wheatley, director, corporate communications/public affairs, Kinder Morgan Inc., says the order is a plus for those engaged in regulatory review and for energy project applicants. “The issues have now been thoroughly addressed and applied in a truly practical sense, based on existing regulations from the Council on Environmental Quality,” he states.
But Ryan Talbott, executive director, Allegheny Defense Project, wants FERC to use its newly-stated “cumulative” environmental review policy on Tennessee Gas’s Orion Project, which is in the same area as the Northeast Project. The project includes two pipeline loops of eight and 4 1/2 miles in Wayne and Pike Counties, PA. FERC issued a notice on Dec. 3 announcing it would be doing an environmental assessment of the project. Talbott says Orion is connected to two other Tennessee proposed projects – Susquehanna West and Triad Expansion – which are all connected and cumulative and that FERC must review them in a single National Environmental Policy Act (NEPA) document.
“It is also important to point out that Tennessee is apparently engaging in the same segmentation activities that the D.C. Court declared illegal in Delaware Riverkeeper Network v.FERC,” Talbott wrote to FERC in November. The Allegheny Defense Project is concerned authorization of Orion will likely induce additional shale gas development in the Marcellus and Utica shale formations in Pennsylvania.
“It appears that the Commission is well aware of the likelihood that anti-pipeline opposition will continue to raise the segmentation issue; and we expect FERC to follow the process outlined in the remand order to address segmentation issues in future environmental analysis,” replies Wheatly.
The National Park Service has already laid out its view that FERC needs to do an expanded environmental assessment on the Orion Project. “The NPS has a number of concerns with the Orion Project,” says Frank Hayes, Associate Regional Director of the NPS.
FERC had approved the Northeast Upgrade in 2012 and it has been completed. It includes five new segments of 30-inch diameter pipeline, totaling about 40 miles, and modified existing compression and metering infrastructure. Taken together, the Northeast Project and the three others connected, closely related and interdependent Tennessee Gas upgrade projects on the 300 Line constituted a complete upgrade of almost 200 miles of continuous pipeline. The 300 Line carries natural gas from wells in western Pennsylvania to points of delivery east of Mahwah, NJ.
After the Northeast Project was approved, the Delaware Riverkeepers Network subsequently filed a lawsuit with the U.S. Court of Appeals for the District of Columbia. The court admitted FERC had looked at the cumulative impacts of the four related projects but found FERC analysis lacked “serious consideration” given the close connection between the four projects.
In its Nov. 19 Order on Remand responding to the Appeals Court, the FERC said it was again finding no significant environmental impacts of the Northeast Upgrade Project. Riverkeeper had been especially concerned about habitat fragmentation, edge effects and deforestation; and hydrology impacts related to wetlands and groundwater. The FERC said those concerns were either unjustified or failed to rise to a level of significance.
Senate Narrowly Fails To Pass Bill
Republicans in the Senate fell a few votes short of passing legislation which would eliminate a final rule from the Environmental Protection Agency (EPA) and Army Corps of Engineers expanding the bodies of water for which permits would be required if construction was undertaken near or through them.
The bill called the Federal Water Quality Protection Act (S. 1140) sponsored by Sen. John Barrasso (R-WY) would have forced the two agencies to go back to the drawing board and re-propose the regulation based on thresholds established in the bill. The bill received a vote in favor by 57-41, but short of the 60 votes it needed if it were to become subject to a filibuster, which was a certainty, given Democratic opposition. The Senate then turned around and passed an essentially meaningless joint resolution by a vote of 53-44 which simply stated that the Congress “disapproves” the waters of the U.S. (WOTUS) rule.
Barrasso’s press secretary did not return an e-mail asking whether the senator plans to redraft his bill in an attempt to earn additional Democratic votes. However, despite the failure of S. 1140 to pass the Senate, implementation of the WOTUS rule is being held in abeyance in some states because of court rulings. A federal court judge in North Dakota issued an injunction on Aug. 27 blocking the rule in 13 states because the rule making record was, in the judge’s words, “inexplicable, arbitrary and devoid of a reasoned process.” The United States 6th Circuit Court of
Appeals put a nationwide stay on the rule on Oct. 9 of last year. The Appeals Court seemed to agree that the WOTUS rule violated some of the standards set by the Supreme Court in a case called Rapanos v. U.S., and that the final rule contained some provisions related to allowable distances from navigable waters which were not included in the proposed rule, so those provisions were not subject to public comments.
Senate Unlikely To Pass Pipeline Permitting Reform
There is a slim likelihood that the pipeline approval reform amendment included in the House-passed energy bill will be passed by Congress. That is because the Senate energy bill that has wide, bi-partisan support does not include a provision allowing the Federal Energy Regulatory Commission (FERC) to approve a pipeline construction application 90 days after completing a final environmental study of the project. That provision is included in the North American Energy Security and Infrastructure Act of 2015 (H.R. 8) which the House approved by a vote of 249 to 174 on Dec. 3. Democrats on the House Energy & Commerce Committee, from whence the bill originated, included a statement in the bill report denouncing the FERC 90-day approval provision.
The House bill, like the Senate bill, which cleared the Senate Energy and Natural Resources Committee by a vote of 18-4, is overwhelmingly devoted to electric grid issues with some hydropower, energy efficiency and vehicle research concerns tossed in. The FERC provision is the only one in the House bill devoted to pipelines. The Senate bill, called the Energy Policy Modernization Act of 2015, does not have a provision focused on pipelines. Democratic opposition to the FERC provision in the House does not bode well for the provision being included on the Senate floor when S. 2012 comes up for a vote.
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