On February 18, 2021, the Federal Energy Regulatory Commission (FERC or Commission) issued a supplemental Notice of Inquiry (February 2021 NOI) seeking additional comments on whether and how it should revise its approach under its 1999 policy statement regarding the certification of new interstate natural gas pipeline facilities. The February 2021 NOI continues the stakeholder process initiated in April 2018, when FERC issued an initial Notice of Inquiry (April 2018 NOI) in this proceeding, and indicates potential changes in FERC’s approach under the new Administration, new Chairman, and with the new composition of FERC Commissioners.
In the April 2018 NOI, FERC sought comments regarding four topics: (1) whether and how it should adjust its methodology for determining whether there is a need for a proposed project; (2) whether and how it should adjust its consideration of the potential exercise of eminent domain and of landowner interests; (3) whether and how it should adjust its evaluation of the environmental impacts of a proposed project; and (4) whether there are any changes it could implement to improve the efficiency and effectiveness of its certificate process. For each topic, FERC set forth specific questions on which it sought stakeholder feedback. In total, the Commission received over 3,000 comments in response to the April 2018 NOI.
With the February 2021 NOI, FERC reopens the comment process, posing revised and expanded questions to stakeholders that account for two developments since the initial NOI comment period. First, the February 2021 NOI notes that new National Environmental Policy Act (NEPA) regulations have been promulgated, requiring agencies to review their processes and streamline environmental reviews. Second, it notes that President Biden recently signed Executive Order 14008, which creates a “whole government” approach to tackling climate change. FERC’s revisions and additions to the April 2018 NOI questions, however, evidence a broader range of policy concerns and a potential shift in FERC policy on both environmental and non-environmental issues.
Notable changes relative to the April 2018 NOI include:
- Project Need: With respect to the Commission’s finding of need for new gas pipeline projects, the Commission has propounded new questions that cut both for and against development of new gas pipeline projects. For example, the Commission asks (i) whether it should consider the proliferation of renewable and other sources of energy in determining the need for projects designed to supply gas-fired generators, and (ii) if it should consider whether demand will actually materialize for a project or could otherwise be accommodated by existing infrastructure. On the other hand, the Commission asks if it should consider the social, economic, and security attributes of domestic natural gas production, including the economic benefits to communities that rely on natural gas jobs.
- Eminent Domain and Landowner Interests: The Commission poses new questions on whether it has authority to condition a certificate holder’s exercise of eminent domain and whether it should defer issuing a certificate until an applicant has all other authorizations needed to commence construction.
- Environmental Impacts/NEPA: The Commission added to or revised all questions posed on this topic in the February 2021 NOI. These questions indicate the potential for more searching and thorough NEPA reviews. Among other things, they indicate the Commission is considering whether to expand the types of alternatives and impacts assessed and that it may increase its efforts to quantify and account for greenhouse gas emissions associated with proposed projects and potential alternatives.
- Commission Review Process: The Commission revised two of its questions regarding the efficiency of the certificate review process in the February 2021 NOI. The first asks what specific changes, if any, should be made to each stage of the application review process (including pre-filing, post-filing, and post-order-issuance) in order to make the process more efficient. The second asks if there are classes of projects that should be subject to a more efficient process and what that process should entail. These questions indicate the Commission is considering more widespread and sweeping changes to improve efficiency than indicated by the April 2018 NOI.
- Environmental Justice: This is a new topic that was not covered in the April 2018 NOI and concerns “the Commission’s identification and addressing of any disproportionately high and adverse human health or environmental effects of its programs, policies, and activities on environmental justice communities and the mitigation of those adverse impacts and burdens.” The February 2021 NOI seeks comment on how to identify and encourage participation of environmental justice communities, how to evaluate environmental justice factors relative to other factors, and whether there is a statutory basis to mitigate effects of projects or reject projects on environmental justice grounds. The addition of this new topic is consistent with the new Chairman’s recent announcement that FERC will create a new senior-level position to address environmental justice impacts of the Commission’s decisions, and indicates that potential impacts on environmental justice communities may be given greater weight, especially with respect to project site selection.
FERC states that comments should only address new questions or provide new information not previously considered for the old questions, and that comments previously submitted in response to the April 2018 NOI will also be considered and need not be resubmitted. The deadline for submitting comments is within 60 days of publication of the NOI in the Federal Register.