In a move that pushes the Federal Energy Regulatory Commission and natural gas pipeline developers onto uncertain legal ground, a federal appeals court rejected FERC's plea not to strip authorizations from a major Florida pipeline project despite the commission warning about "disruptive consequences" of shutting down the gas conduit.
In a one-page order issued Jan. 31, the U.S. Appeals Court for the D.C. Circuit denied FERC's petition for rehearing by the whole court of an August 2017 decision that vacated FERC approvals of the three parts of the Southeast Market Pipelines project, which include the operational 515-mile Sabal Trail Transmission LLC pipeline. The court said FERC should have looked at greenhouse gas emissions from downstream power plants in its environmental review of the pipeline projects, and it sent the matter back to the commission for that analysis.
In its October 2017 petition for rehearing, supported by the gas pipeline developers, FERC told the court it had complied with the requirement for the extra analysis, issuing a draft supplemental environmental impact statement in September 2017, but it warned the court not to vacate the project authorizations.
"The court's decision appears not to apprehend the disruptive consequences of vacatur here, as it does not reconcile the judgment of vacatur with the public need for the pipeline projects," the commission said in the petition. The commission said knocking the pipeline out of service could hobble Florida electric power generation. (U.S. Appeals Court for the D.C. Circuit docket 16-1329)
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The three parts are the $3.2 billion Sabal Trail pipeline, a joint project of Enbridge Inc., NextEra Energy Inc. and Duke Energy Corp. that will eventually bring up to 1.1 Bcf/d of gas deep into Florida; the $459.8 million Hillabee expansion project on Williams Partners LP's Transcontinental Gas Pipe Line Co. LLC system; and NextEra's $537.3 million Florida Southeast Connection project. In June 2017, FERC allowed the operators to put the first part of the Sabal Trail pipeline and other parts of the greater project in service.
Enbridge spokeswoman Andrea Grover said Feb. 1 that there are "a number of procedural steps we can pursue" after the court order. She could not comment further on pending litigation.
In an alert, ClearView Energy Partners LLC said the court decision would probably not have a significant effect on the projects involved or on other pipeline reviews. The energy policy research firm said the certificates issued to the projects will not be vacated until the court issues a mandate to FERC, which could come Feb. 7, but FERC could potentially ask the court to withhold the mandate for an appeal to the Supreme Court.
If the court mandate does vacate the permits, ClearView cautioned that the "exact procedural road ahead for the commission looks unclear." FERC could issue a final supplemental environmental impact statement soon and issue certificates as early as March, the firm said. If the authorizations are pulled, "it is possible that the project could need to temporarily wind down construction operations until new certificates can be issued," along with new notices to proceed, ClearView said.
FERC spokeswoman Tamara Young-Allen said the commission is reviewing the court decision to determine its next steps. She noted that both the final supplemental environmental impact statement and the commission's order on remand await final decisions.
The Sierra Club, which with other groups had brought the matter to court with a challenge of the FERC approval, said the court's rejection of the FERC petition sent a signal to the commission and the pipeline industry. The group said the ruling could mean the Sabal Trail pipeline must cease operations until FERC finishes a complete review of its overall environmental impact.
"The D.C. Circuit's orders confirm what we already knew: when a fracked gas pipeline has been constructed without its threats being fully considered, the pipeline should not be allowed to continue operating," group staff attorney Elly Benson said in a Feb. 1 statement.
FERC approved the components of the Southeast Market Pipelines project in February 2016. Much of the construction on the first phase of the Sabal Trail pipeline is complete. The pipeline developers asked for and received on Jan. 31 an extension of the deadline for putting the first phase in service from Feb. 2 to Aug. 31. (FERC docket CP15-17)

