Commissioner Cheryl A. LaFleur Statement
June 12, 2018
Docket No. CP15-77-001
“Today’s order denies rehearing of the order approving Tennessee’s Broad Run Expansion Project. I supported our original authorization of this project by finding that on balance, the project was in the public interest. I write separately to provide additional context for continuing to find the project is in the public interest. I will also address how, in light of ongoing disagreements on the Commission concerning the scope of our environmental review in Natural Gas Act (NGA) section 7 proceedings, I will try to address these cases going forward.
“I continue to support the project at issue in this docket despite my strong disagreement with the Commission’s new policy, which was recently announced in the New Market 1
rehearing order and is applied in today’s order, that limits the review and disclosure of upstream and downstream greenhouse gas (GHG) impacts as part of our National Environmental Policy Act (NEPA) responsibilities and public interest determination under the NGA. 2
I fully explained in my dissent in New Market why I oppose this change in policy.
“In my time at the Commission, whether voting with the majority or in dissent, I have tried to address each case as if my vote and views determined the outcome of the matter. With respect to our certificate review, despite my strong disagreement with the majority’s new policy refusing to disclose and consider certain environmental effects, I recognize that a project under review may be needed to serve customers and is in the public interest. As a result, I am hesitant to allow the majority’s troubling statements dictate that I dissent in each case, especially where, as here, I believe the record supports approval of a certificate. Going forward, I intend to the best of my ability, to move beyond our disagreement on the Commission’s approach, however important it may be, to consider whether a particular project is in the public interest. I will base this determination on the facts in the record—even ones overlooked by the majority—and the governing law as I read it.
“In this case, the record for the Broad Run Project did not contain specific information on the end-use for the project’s 200,000 dekatherms per day (Dth/d) of firm transportation service on the Tennessee system. On rehearing, intervenors argue that the Commission’s GHG impacts analysis is inadequate, and in particular, failed to sufficiently consider the upstream and downstream GHG impacts of the project. The Commission nonetheless declines to disclose additional information or provide additional analysis, arguing that upstream and downstream impacts are not indirect impacts of the proposed pipeline project, and thus no additional analysis is necessary. To address my concerns about the Commission decision to ignore downstream emissions impacts in this proceeding, I have myself considered the downstream GHG emissions as part of my public interest determination. 3
“Using a methodology developed by the Environmental Protection Agency (EPA) to estimate the downstream GHG emissions from the project, and assuming all of the gas to be transported is eventually combusted, 200,000 Dth/d of natural gas service would result in the emission of approximately 3.7 million metric tpy of CO2e. 4
This is an upper bound estimate because some of the gas may displace fuels (i.e., fuel oil and coal) meaning that the combustion of gas could result in lower total CO2e emissions. The 3.7 million tons of GHG emissions from downstream use would result in at most a 5.7 percent increase in GHG emissions from fossil fuel combustion in Mississippi, and less than 0.1 percent increase nationally. I recognize that this full-burn estimate is simply a mathematical derivative of pipeline volume, but I still want to disclose it and consider it as part of my public interest determination, particularly where there is not more precise evidence of downstream pipeline utilization. 5
More information in the record with an identified end use would enable the Commission to more accurately assess the indirect impacts of downstream GHG emissions by calculating gross and net GHG emissions. 6
“I also do not support the Commission’s application of its new policy announced in New Market to exclude all generic upstream information from its public interest determination. While it is less clear that upstream effects are caused by the pipeline, I believe we should respond to concerns raised regarding upstream GHG impacts by disclosing the best available information, such as the Department of Energy (DOE) studies cited in past orders. 7
In fact, the Commission’s earlier certificate order authorizing the Broad Run Project discussed impacts of upstream production by referencing the general information and studies released by the DOE and EPA on natural gas production. 8
“After balancing the economic need for the Broad Run Project and all of its environmental impacts, I continue to believe that it is in the public interest.
“While I do not intend to fully delineate my disagreement with the majority’s review approach in each case, I do believe that it should be thoroughly reexamined as part of our ongoing Notice of Inquiry on the Certificate Policy Statement. 9
This review is an important and timely opportunity to engage broadly with stakeholders on all aspects of the Commission’s pipeline review. I particularly look forward to an open and productive conversation on how the Commission should consider climate change in our environmental reviews and am hopeful that this conversation will yield a better path forward in this aspect of our work.
“For all of these reasons, I concur.”
- 11 Dominion Transmission Inc., 163 FERC ¶ 61,128 (2018) (LaFleur, Comm’r, dissenting in part) (New Market).
- 22 See also, Florida Southeast Connection, LLC, 163 FERC ¶ 61,158 (2018) (LaFleur, Comm’r, concurring) and Florida Southeast Connection, LLC, 162 FERC ¶ 61,233 (2018) (LaFleur, Comm’r, dissenting in part) (these separate statements address the Commission’s responsibility to determine the significance of downstream GHG emissions and use of Social Cost of Carbon to translate the GHG emissions to climate harm).
- 33 I believe that it is reasonably foreseeable in the vast majority of cases that the gas being transported by a pipeline we authorize will be burned for electric generation or residential, commercial, or industrial end uses. In those circumstances, there is a reasonably close causal relationship between the Commission’s action to authorize a pipeline project that will transport gas and the downstream GHG emissions that result from burning the transported gas. See Mid States Coalition for Progress v. Surface Transportation Board, 345 F.3d 520, 549 (8th Cir. 2003) (Mid States). In Mid States, the Court concluded that the Surface Transportation Board erred by failing to consider the downstream impacts of the burning of transported coal. Even though the record lacked specificity regarding the extent to which the transported coal would be burned, the Court concluded the nature of the impact was clear.
- 44 This estimate also assumes the maximum capacity is transported 365 days per year, which is not usually the case because many projects are designed for peak use.
- 55 One reason the Commission lacks the specificity of information to determine causation and reasonable foreseeability is because we have not asked applicants to provide this sort of detail in their pipeline applications. I note that some of the questions in the notice of inquiry on pipeline review ask commenters to weigh in on the types of information the Commission should seek as part of its pipeline review process. I believe that in the future we should have more information included in the record to consider when reviewing a project proposal.
- 66 See, Sierra Club v. FERC, 867 F.3d 1357, 1374 (D.C. Cir. 2017) (Sabal Trail). In Sabal Trail, the Court concluded because the pipeline was delivering gas to an identified end use, four downstream power plants, the burning of gas at those power plants was an indirect impact to be quantified and considered as part of our NEPA responsibilities. Commission staff quantified the gross, net, and full burn of downstream GHG emissions. The gross total represents the expected use of the downstream power plant facilities. The net total includes the gross total minus the offset from coal-fired generating facility retirements. The full burn estimate is the calculation of the complete combustion of the total pipeline capacity. See Sabal Trail Supplemental Environmental Impact Statement (SEIS) at 4-5.
- 77 In the recent past, Commission orders used DOE studies, such as, Dep’t of Energy and Nat’l Energy Tech. Laboratory, Life Cycle Analysis of Natural Gas Extraction and Power Generation, DOE/NETL-2015/1714 (Aug. 30, 2016) (2016 DOE/NETL Study); U.S. Energy Info. Admin., The Growth of U.S. Natural Gas: An Uncertain Outlook for U.S. and World Supply (June 15, 2015), http://www.eia.gov/conference/2015/pdf/presentations/staub.pdf; Dep’t of Energy and Nat'l Energy Tech. Laboratory, Environmental Impacts of Unconventional Natural Gas Development and Production, DOE/NETL-2014/1651, (May 29, 2014) (2014 DOE/NETL Study), to identify potential environmental impacts associated with unconventional natural gas production related to the proposed project. E.g., NEXUS Gas Transmission, LLC, 160 FERC ¶ 61,022 (2017); National Fuel Gas Supply Corporation, 158 FERC ¶ 61,145 (2017); Tennessee Gas Pipeline Company, LLC, 158 FERC ¶ 61,110 (2017); Rover Pipeline LLC, 158 FERC ¶ 61,109 (2017); Algonquin Gas Transmission, LLC, 158 FERC ¶ 61,061 (2017); and Columbia Gas Transmission, LLC, 158 FERC ¶ 61,046 (2017).
- 88 Tennessee Gas Pipeline Company, L.L.C, 156 FERC ¶ 61,157 at P 70 (2016) (“Nonetheless we note that although not required by NEPA, a number of federal agencies have examined the potential environmental issues associated with unconventional natural gas production in order to provide the public with a more complete understanding of the potential impacts. The DOE has concluded that such production, when conforming to regulatory requirements, implementing best management practices, and administering pollution prevention concepts, may have temporary, minor impacts to water resources. The EPA has reached a similar conclusion. With respect to air quality, the DOE found that natural gas development leads to both short- and long-term increases in local and regional air emissions. It also found that such emissions may contribute to climate change. But to the extent that natural gas production replaces the use of other carbon-based energy sources, the DOE found that there may be a net positive impact in terms of climate change.”).
- 99Certification of New Interstate Natural Gas Facilities, Notice of Inquiry, Certification of New Interstate Natural Gas Facilities, Notice of Inquiry, 163 FERC ¶ 61,042 (2018).