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Commissioner Cheryl A. LaFleur
August 10, 2018
Docket No.
CP17-15-001
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Dissent on Dominion Energy Cove Point LNG

In today’s order, the Commission denies rehearing of its January 23, 2018 order authorizing Dominion Energy Cove Point LNG/ LP (Cove Point LNG) to construct, install, operate, and maintain natural gas compression facilities in Charles County, Maryland, and Loudoun and Fairfax Counties, Virginia (Eastern Market Access Project), to provide up to 294,000 dekatherms per day (Dth/d) of firm transportation service.1 Upon consideration of the rehearing request, I believe the fact pattern presented in this case, the expansion of pipeline throughput that will serve clearly-identified downstream power plants, falls squarely within the precedent of Sierra Club v. FERC.2 Given that the majority’s analysis here suffers from the same flaws as its decision on remand in Sabal Trail,3 I respectfully dissent.

One of the two stated purposes of the Eastern Market Access Project is to serve Mattawoman Energy Center, a planned 990-megawatt natural gas-fired generation facility in Maryland.4 Under Sabal Trail, the downstream greenhouse gas (GHG) emissions associated with the combustion of transported gas at that facility are indirect impacts that must be quantified and considered as part of our National Environmental Policy Act (NEPA) review. However, the Commission failed to identify those emissions as indirect impacts, let alone sufficiently quantify and consider those emissions as required by NEPA. Among other arguments raised on rehearing, the Accokeek Intervenors5 claim that the Commission inadequately or incorrectly considered GHG emissions associated with the downstream combustion of the transported gas. In this case, the EA quantified and disclosed the upper-bound estimate of downstream GHG emissions from the Project.6 The Rehearing Order also concluded that, assuming the upper-bound estimate, the combustion would increase GHG emissions by about 3.5 percent in Maryland and Virginia, and increase GHG emissions by 0.11 percent, nationally.7 While acknowledging that analysis in the Rehearing Order, the majority fails to make a determination regarding the significance of those emissions. Instead, the majority again relies on its conclusion that there is no “standard established by international or federal policy, or by a recognized scientific body that would assist us to ascribe significance to a given rate or volume of GHG emissions.”8

I disagree with this conclusion and believe that the majority’s failure to make a significance determination does not comply with Sierra Club. Under NEPA, when evaluating the significance of a particular impact, the Commission must consider both context and intensity.10 While it appears that the EA included qualitative discussion as a means to provide context regarding the impact, the majority makes no finding regarding the intensity of the identified environmental impact. I recognize that determining the severity of a particular impact would require thoughtful and complex analysis, and I am confident that the Commission could perform that analysis if it chose to do so; indeed, we routinely grapple with complex issues in many other areas of our work.11 But in order to comply with NEPA, the Commission cannot simply inventory GHG emissions for the individual project – it must go an additional step and determine whether a particular level of emissions is significant.12 I further note that, as I have repeatedly argued, the Social Cost of Carbon is a readily-available tool for translating the GHG emissions from a particular project into monetized climate damages, which could assist the Commission in assessing the significance of those emissions.

Given the majority’s failure to comply with Sierra Club, I cannot support denying rehearing in this case. Accordingly, I respectfully dissent.

                                               

    1 Dominion Energy Cove Point LNG, LP, 162 FERC ¶ 61,056 (2018) (Certificate Order).
    2 867 F.3d 1357 (D.C. Cir. 2017) (Sierra Club).
    3 Florida Southeast Connection, LLC, 162 FERC ¶ 61,233 (2018) (LaFleur, Comm’r, dissenting in part) (Sabal Trail).
    4 Environmental Assessment (EA) at 1. Environmental Assessment (EA) at 1.
    5 Accokeek Intervenors (also referred to as “Accokeek”) are comprised of Accokeek, Mattawoman, Piscataway Creeks Community Council, Kelly Canavan, Joshua Kaufman, Osman Kivrak, Dr. Theresa Lazar, Paul Livingston, Jasmine Waring and the Moyaone Association.
    6 The EA includes an estimate that if all 294,000 Dth/d of natural gas were transported to combustion end uses, downstream end-use would result in the emissions of about 5.9 metric tpy of CO2e. EA at 79-80. The Commission should have sought more precise information to develop the record in this proceeding, to allow the Commission to more accurately assess the indirect impacts of downstream GHG emissions by calculating gross and net GHG emissions.
    7 Rehearing Order at n.56.
    8 Id. P 18.
    9 40 C.F.R. § 1508.27(a) (2017) (Context means “that the significance of an action must be analyzed in several contexts such as society as a whole (human, national), the affected region, the affected interests and the locality.”).
    10 40 C.F.R. § 1508.27(b) (2017) (Intensity refers to “the severity of the impact.”).
    11 Many of the core areas of the Commission’s work have required the development of analytical frameworks, often a combination of quantitative measurements and qualitative assessments, to fulfill the Commission’s responsibilities under its broad authorizing statutes. This work regularly requires that the Commission exercise judgment, based on its expertise, precedent, and the record before it. For example, to help determine just and reasonable returns on equity (ROEs) under the Federal Power Act, NGA, and Interstate Commerce Act, the Commission identifies a proxy group of comparably risky companies, applies a discounted cash flow method to determine a range of potentially reasonable ROEs (i.e., the zone of reasonableness), and then considers various factors to determine the just and reasonable ROE within that range. See also, e.g., Promoting Transmission Investment through Pricing Reform, Order No. 679, FERC Stats. & Regs. ¶ 31,222, order on reh’g, Order No. 679-A, FERC Stats. & Regs. ¶ 31,236 (2006), order on reh’g, 119 FERC ¶ 61,062 (2007) (establishing Commission regulations and policy for reviewing requests for transmission incentives); Transmission Planning and Cost Allocation by Transmission Owning and Operating Public Utilities, Order No. 1000, FERC Stats. & Regs. ¶ 31,323 (2011), order on reh’g, Order No. 1000-A, 139 FERC ¶ 61,132, order on reh’g and clarification, Order No. 1000-B, 141 FERC ¶ 61,044 (2012), aff’d sub nom. S.C. Pub. Serv. Auth. v. FERC, 762 F.3d 41 (D.C. Cir. 2014) (requiring, among other things, the development of regional cost allocation methods subject to certain general cost allocation principles); BP Pipelines (Alaska) Inc., Opinion No. 544, 153 FERC ¶ 61,233 (2015) (conducting a prudence review of a significant expansion of the Trans Alaska Pipeline System).
    12 See, e.g., Sierra Club v. U.S. Dept. of the Interior, Opinion No. 18-1082 at *17 (4th Cir. Aug. 6, 2018) (finding that an agency “cannot escape its statutory and regulatory obligations by not obtaining accurate scientific information”).

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