US FERC chairman expects 'dramatic' impact on gas project reviews after high court ruling

US Federal Energy Regulatory Commission Chairman Mark Christie said in an interview with Platts that he expects the US Supreme Court's May 29 ruling on the National Environmental Policy Act will lead to significantly shorter and more legally durable environmental reviews for gas projects.

In a case involving an 88-mile rail line planned to connect Utah's Uinta Basin to the national railway network, the high court's majority found that federal courts should give substantial deference to agencies on the scope of their NEPA reviews. Agencies are not required to consider the effects of upstream and downstream projects that are separate in time and place, especially when the separate projects fall outside the agency's regulatory authority, the court said (Seven County Infrastructure v. Eagle County, Colorado, 23-975).

In a June 8 interview, Christie said the ruling should have a "dramatic impact" on the environmental impact statement process at FERC and other agencies.

"Most importantly, the Seven County opinion recognized that NEPA has been turned into a weapon for the last 30 years to stop projects, and the court said that practice has to end," the chairman said.

The ruling "should dramatically shorten the EIS process, and just as importantly, should make the EIS that FERC does much more legally durable when it is challenged in court," the current FERC chairman added.

In particular, Christie argued that the ruling "effectively overruled" the US Court of Appeals for the District of Columbia Circuit's decision in a case involving the Sabal Trail Transmission natural gas pipeline. The Sabal Trail ruling faulted FERC's explanation for why the agency did not consider the downstream emissions from generators the pipeline would serve. Environmental groups have frequently cited the case in challenging FERC's orders on multiple grounds.

In Christie's view, the Sabal Trail opinion has been used as a "legal weapon" against FERC by requiring the commission to consider downstream effects that are not under its jurisdiction.

"The Seven County opinion was clear that FERC does not have to do evaluations now for the EIS of downstream non-jurisdictional activities or upstream non-jurisdictional activities," Christie said.

Early ripple effects

Since late May, the commission has already made court filings citing the Seven County ruling to bolster its defenses against several separate challenges to FERC gas project authorizations.

Sierra Club has challenged the commission in the DC Circuit over its approval of the Saguaro Pipeline Project, a cross-border gas project linked to a pipeline planned in Texas.

The commission told the court that the Seven County case shows that the Sierra Club is incorrect in the Saguaro case. "FERC was not required to analyze the effects of the Connector Pipeline because FERC lacks regulatory authority over that pipeline," the commission said (Sierra Club v. FERC, 24-1199).

Sierra Club, in turn, said that FERC has jurisdiction and authority over the entire pipeline in the Saguaro case. "There is no operational or physical break at the pipeline's 1,000-foot line, making it two separate or distinct projects," the Sierra Club wrote the court June 9. The environmental group also argued FERC has jurisdiction because the pipeline connects to the ONEOK WesTex Transmission, which is part of a system that transports interstate gas.

The commission further raised the new Supreme Court ruling in a case involving the Cumberland Project, a 32-mile, 245,050 Dt/d Tennessee Gas Pipeline project planned to serve gas-fired generation planned by the Tennessee Valley Authority (Sierra Club v. FERC, 24-1099).

Sierra Club, in response, called the pipeline and the gas plant "physically, temporally, and functionally joined," unlike the railway, wells, and refineries considered in the Seven County case.

Even if the plant is under TVA jurisdiction, Sierra Club said, FERC baked into its final decision a mistaken view that downstream greenhouse gas emissions would decrease, the environmental group wrote June 6.

Debate over the implications of the Supreme Court ruling also featured in oral argument June 2 regarding FERC's approval of the GTN XPress project before the 5th Circuit.

Despite the high court setback, environmental groups have promised to continue fighting gas projects, with some emphasizing state or local legal battles ahead.