US court presses pipeline regulator on climate analysis

  • Market: Emissions, Natural gas
  • 11/04/19

A panel of federal judges had tough questions today for the US Federal Energy Regulatory Commission (FERC) in two lawsuits that accuse the agency of abdicating its duty to estimate greenhouse gas emissions from natural gas pipelines.

The lawsuits, which went through oral arguments today in the DC Circuit Court of Appeals, could set an important precedent for how rigorously the climate effects from pipelines should be studied. FERC over the past two years approved nearly 40 Bcf/d of pipeline capacity, equivalent to 45pc of US gas production, but critics say the agency is dragging its feet on studying whether that pipeline build-out is increasing planet-warming emissions.

"What FERC would like to do is never do it," said attorney Robert Sussman, who is representing a non-profit named Otsego 2000 that is challenging FERC's approval of a pipeline project in New York.

The two lawsuits center around two small pipeline projects. Otsego 2000 is seeking to throw out FERC's approval of a project that would add 108,000 cf/d of capacity to Dominion Energy's pipeline system in New York. A group of landowners, in a separate lawsuit, are challenging a 200,000 cf/d project backed by the Tennessee Gas pipeline. The two projects have already been built and started operations.

The Otsego 2000 case has taken on particular importance because FERC, in an order last year related to the project, announced a new policy that it would no longer try to provide a generic estimate of downstream greenhouse gas emissions from most pipelines. The lawsuits say that policy flies in the face of a DC Circuit ruling in 2017, where the court rebuked the agency for not estimating emissions from operating the $3bn Sabal Trail pipeline in Florida.

FERC attorney James Danly said the projects at issue today are different because there was "multiple compounding uncertainty," such as how much gas would be used, the destination of the gas and whether it would displace other fuel types. That makes it different from the 2017 case, he said, where the Sabal Trail pipeline was built specifically to supply new gas-fired power plants in Florida.

But the judges suggested that while FERC might eventually find it is unable to provide an estimate of greenhouse gas emissions, the agency may be falling short in trying to gather information from pipeline developers on where natural gas is produced and where it is going.

"How do we know that unless we ask?" judge David Tatel said. "We would not be guessing about any of this if the commission simply asked Dominion."

Another judge on the panel, Robert Wilkins, said existing regulations require FERC to try to collect all the data it needs to scrutinize a project's effect, and then provide an explanation if that information is not complete. The final judge on the panel, Merrick Garland, said the court ruling on Sabal Trail suggests a requirement to attempt to study emissions.

"We have never suggested that even if FERC thinks that it cannot evaluate the climate effect, that it does not have to evaluate the emissions," he said.

The Otsego 2000 case could face a preliminary hurdle because of questions about whether it has the legal ability to file a lawsuit. Sussman, the group's attorney, said it did because the lack of greenhouse gas information from FERC harmed its ability to educate the public.


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