Texas Gas Transmission LLC's plan for a 220,000 Dth/d pipeline expansion to serve new gas-fired power in Indiana cleared an environmental review by the Federal Energy Regulatory Commission despite ongoing uncertainty at the agency about how to consider climate change.
The draft environmental impact statement issued on April 14 stopped short of drawing conclusions about the potential climate impacts of the project, which the developer had described as a benefit because the pipeline expansion would help displace coal-fired generation.
The report came three weeks after FERC's Democratic majority decided to suspend an overhaul of the agency's pipeline permitting policy and revisit it after seeking more public comment. The policy revisions had called on FERC to take a harder look in permitting decisions at the need for projects and at their impacts on climate, among other changes, but drew intense pushback from lawmakers and industry officials.
"This [draft environmental impact statement] is not characterizing the project's greenhouse gas emissions as significant or insignificant because the commission is conducting a generic proceeding to determine whether and how the commission will conduct significance determinations going forward," FERC staff wrote in the Texas Gas report.
The proposed project would add gas transportation capacity to supply 460 MW of gas-fired generation planned by CenterPoint Energy Inc. in Posey County, Ind.(CP21-467). The expansion would entail a 24-mile, 20-inch-diameter lateral, as well as a new 4,863-horsepower compressor unit at an existing station in Webster County, Ky., along with a new meter and regulator station and other facility upgrades.
Report includes social cost of emissions
Although FERC has shied away from weighing greenhouse gas emissions in project decisions, the U.S. Environmental Protection Agency has continued pressing the commission to go further in its evaluation of climate change impacts.
The draft environmental report for Texas Gas included an estimate of the social cost of greenhouse gases, a tool the EPA has recommended that FERC use. The social cost of greenhouse gas emissions is a monetary estimate of long-term economic damage that can be considered in a cost-benefit analysis, although there is pending litigation challenging the use of the tool by federal agencies. FERC staff estimated the total social cost of greenhouse gases associated with the Texas Gas expansion would be about $12 billion over a 20-year period.
FERC staff found that apart from climate impacts they did not factor in, the project would not result in significant environmental harm if recommended mitigation measures are adopted.
Texas Gas had argued in its June 2021 project application that the expansion "will facilitate a substantial net reduction in overall [greenhouse gas] emissions." Texas Gas said the project would specifically lead to a net reduction in methane, nitrogen oxide and carbon monoxide emissions, as well as resulting in a shift from existing reciprocating compressor units and reducing indirect downstream emissions by replacing coal-fired generating facilities. The developer asked FERC to issue a certificate no later than Sept. 16, 2022, in order to begin construction in summer 2023 and place the project in service by Feb. 1, 2024.
"CenterPoint is adding the new natural gas turbines as part of its preferred portfolio of electric generation resources, which is designed to facilitate a substantial reduction in greenhouse gas emissions by, among other things, retiring existing coal-fired generating facilities located at the A.B. Brown Plant and adding at least 1,000 MW of new wind and solar resources," Texas Gas told FERC.
S&P Global Commodity Insights produces content for distribution on S&P Capital IQ Pro.
