FERC pressed to revisit pipeline permit overhaul

A federal regulator's push for gas companies to curtail greenhouse gas emissions from pipelines has triggered backlash on Capitol Hill, as lawmakers make their case for major changes.

The US Federal Energy Regulatory Commission (FERC) last month voted 3-2 to overhaul a policy last revised in 1999 for issuing certificates for new pipelines. One of the most contested changes, approved by FERC's Democratic majority, would encourage developers to propose ways to "mitigate" a project's foreseeable greenhouse gas emissions before a project is permitted.

But industry groups, along with FERC's two-member Republican minority, say that change would require developers to effectively "guess" at how much mitigation is necessary. FERC has left it up to developers to voluntarily decide if mitigation will only apply to direct emissions, such as natural gas leaks on a pipeline, or if it should also cover downstream emissions from customers burning natural gas.

"Who can go out and raise $6bn of risk capital, based on a prospect that you do not even know what three members of the commission are going to be willing to approve?" FERC commissioner Mark Christie, a Republican, said before the US Senate Energy and Natural Resources Committee today.

Pipeline developers have similarly criticized the policy and Democratic FERC chairman Richard Glick's argument it will add to long-term certainty for industry, by reducing the risk of court losses. The industry is urging FERC to narrow the policy to focus specifically on direct greenhouse gas effects.

"It is not FERC's role to judge the efficacy of states' efforts to address climate change and to step in where the Commission thinks states have failed," the Interstate Natural Gas Association of America wrote to lawmakers on 28 February.

FERC's Democrats and environmental groups have defended the policy change. Glick said today that asking developers to mitigate greenhouse gases is no different from how the agency handles soil erosion and other issues posed by pipeline construction. In some cases, developers could provide data showing a pipeline will cut emissions, he said.

"In many cases a proposed project, when it comes to us, the application will say whether the project is actually going to reduce dirtier fossil fuel," Glick said. "So what is wrong with taking a look at that?"

Even if FERC retains the new policy, Republicans and industry groups are pressing the agency to revert back its earlier procedures for pipelines that have already been in the permitting process for 1-2 years. An industry coalition is pointing to "geopolitical realities" of Russia's invasion of Ukraine as justification for FERC to quickly approve pending projects that would send feed gas to LNG export facilities.

Approving those projects would reflect "a bold step toward protecting the US allies and eliminating the leverage and profit that enables Russia's international aggression," the chief executives of Williams, Kinder Morgan, TC Energy and Enbridge wrote on 2 March to the agency.

The industry argument about the need to approve more US pipelines has attracted some bipartisan support. Senate Energy Committee chairman Joe Manchin (D-West Virginia) today reiterated criticisms of FERC's policy change, which he said was a threat to affordable and reliable energy.

"I am all for [energy] transition, if we can make sure we can have reliable, affordable and dependable power," Manchin said. "I am just not going to go out 10 years from now and be caught short. That is the problem, that is what Europe did."

By Chris Knight