On February 18, 2021, the Federal Energy Regulatory Commission (FERC or Commission) issued a renewed Notice of Inquiry (NOI)[1] seeking input on potential revisions to its current Policy Statement on the certification of new natural gas transmission facilities.[2] The NOI supplements FERC’s 2018 NOI issued on the same topic.[3] Citing changes following receipt of comments in its 2018 NOI proceeding (e.g., the Council on Environmental Quality’s promulgation of updated regulations under the National Environmental Policy Act of 1969 (NEPA) for implementation by all federal agencies[4] and Executive Order 14008[5]) FERC is seeking to refresh the record and provide “additional viewpoints.”
The 2018 NOI identified four areas concerning its certificate policy that FERC was considering revisiting: “(1) the reliance on precedent agreements to demonstrate need for a proposed project; (2) the potential exercise of eminent domain and landowner interests; (3) the Commission’s evaluation of alternatives and environmental effects under NEPA and the Natural Gas Act (NGA); and (4) the efficiency and effectiveness of the Commission’s certificate processes.”[6] The current NOI revises and expands upon the questions previously presented by the FERC in those areas.
Regarding Issue 1 (Potential Adjustments to the Commission’s Determination of Need), FERC reissued the questions it previously asked and included three new inquiries. Specifically, FERC asked whether it should adjust its needs assessment to examine: “(1) if existing infrastructure can accommodate a proposed project (beyond the system alternatives analysis examined in the Commission’s environmental review); (2) if demand in a new project’s markets will materialize; or (3) if reliance on other energy sources to meet future demand for electricity generation would impact gas projects designed to supply gas-fired generators? If so, how?”
The NOI also asks:
- Should FERC consider the economic, energy security and social attributes of domestic production and use of natural gas?
- Should FERC consider low to middle-income communities’ interests in which the production or transportation of natural gas is a significant source of jobs and/or tax revenues that fund public services?
Regarding Issue 2 (the Exercise of Eminent Domain and Landowner Interests), FERC reissued its previous questions and included one new inquiry for comment. The new inquiry focused on (1) whether FERC has the authority to condition a certificate holder’s exercise of eminent domain, (2) whether FERC should defer issuing an NGA Section 7 certificate until an applicant has all other authorizations needed to commence construction and whether such a deferral is consistent with NGA Section 7(c), and (3) in what circumstances an applicant may need a certificate prior to receipt of all authorizations and prior to commencement of construction.
Regarding Issue 3 (the Commission’s Consideration of Environmental Impacts), FERC re-asserted questions concerning its environmental analysis, seeking comments both on the scope of legal assessment and input on practical issues. FERC reprised questions about the Social Cost of Carbon, including the practical and conceptual issues posed through the use of such a tool, and again requested input on whether it is the proper for the agency to address those issues. FERC also sought input on how other agencies have applied categorical exclusions to a NEPA analysis.
Regarding Issue 4 (Improvements to the Efficiency of the Commission’s Review Process), FERC sought specific proposals to change its review processes to enhance efficiency. FERC posed new questions concerning whether its certificate process could be made more efficient and whether there are classes of projects that could be more efficiently processed.
Finally, FERC raised a new issue (Commission’s Consideration of Effects on Environmental Justice Communities) signaling a heightened concern regarding environmental justice issues. FERC discussed Executive Order 14008 which directed federal agencies to develop “programs, policies, and activities to address the disproportionately high and adverse human health, environmental, climate-related and other cumulative impacts on disadvantaged communities, as well as the accompanying economic challenges of such impacts.”[7] FERC sought responses to seven new questions concerning environmental justice, including questions concerning how FERC identifies potentially affected environmental justice communities, environmental justice community participation in FERC proceedings, how FERC evaluates impacts on such communities, what duties the NGA or NEPA imposes concerning environmental justice, what method FERC should establish for mitigating impacts on such communities and what remedies are available under the NGA, NEPA or other statutes associated with environmental justice impacts.
Comments on the NOI are due 60 days following publication in the Federal Register.
While emphasizing that participants should not repeat their comments in response to the 2018 NOI, FERC’s current comment period invites new participants to comment on questions propounded in 2018. That procedure runs the risk of allowing the new participants to sandbag those entities commenting in 2018. FERC does not say how it proposes to address this procedural disconnect nor does it indicate how it believes developments arising after the 2018 NOI have affected the Commission’s obligations.
FOOTNOTES
[1] Certification of New Interstate Natural Gas Facilities, 174 FERC ¶ 61,125 (2021) (NOI).
[2] Certification of New Interstate Natural Gas Pipeline Facilities, 88 FERC ¶ 61,227 (1999), clarified, 90 FERC ¶ 61,128, further clarified, 92 FERC ¶ 61,094 (2000) (Policy Statement).
[3] Certification of New Interstate Natural Gas Facilities, 163 FERC ¶ 61,042 (2018) (2018 NOI).
[4] Update to the Regulations Implementing the Procedural Provisions of the National Environmental Policy Act, 85 FR 43,304 (2020). CEQ’s final rule directs agencies to propose revisions to their NEPA procedures consistent with the final rule by September 14, 2021. Further, the Commission’s regulations provide that “[t]he Commission will comply with the regulations of the Council on Environmental Quality except where those regulations are inconsistent with the statutory requirements of the Commission.” 18 CFR 380.1.
[5] Exec. Order No. 14008, § 219, 86 FR 7619.
[6] NOI, 174 FERC ¶ 61,125 at P 5.
[7] Exec. Order No. 14008, § 219, 86 FR 7619, 7629; see also The White House, Fact Sheet: President Biden Takes Executive Actions to Tackle the Climate Crisis at Home and Abroad, Create Jobs, and Restore Scientific Integrity Across Federal Government (2021).