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FERC and the Environment

Respecting the environment is one of the Commission's visions and an important part of the country's energy markets and infrastructure. FERC oversees environmental matters related to natural gas and hydroelectric projects. The Commission does this by granting licenses or certificates (permits) to companies that allows them to build dams and natural gas facilities. In order to get these permits, the companies must prove that they are going to take the environmental impact of their project into consideration. However, the Commission also has to consider the energy needs of the place where the natural gas pipeline or hydroelectric dam is being planned. The Commission does not oversee the construction of oil pipelines.

The Commission must balance many issues in the interest of the public. These issues include what a proposed natural gas or hydroelectric project's environmental impacts might be and what protective measures are necessary to avoid or minimize those impacts. The Commission's public interest balancing gives appropriate weight to environmental protection measures, as reflected in conditions included in licenses and certificates.

Did You Know...
A former railroad conductor named Edwin Drake struck oil 69.5 feet below the surface of the ground on August 27, 1859 in Titusville, Pennsylvania. His was the first oil producing well in the United States.

With respect to hydroelectric projects, FERC safeguards the environment by:
  • making sure that planned projects will not damage the environment;
  • requiring that prior to licensing, applicants communicate fully with relevant federal and state land managing agencies, Indian tribes, and state water quality agencies;
  • ensuring that all license applicants perform studies that are necessary to make an informed decision;
  • issuing draft environmental assessments for comment;
  • including license articles that require consideration of what the entire impact on the environment will be ;
  • Inspecting projects that are requesting re-licenses or license amendments. These visits and meetings help determine the range of environmental issues which require analysis. Scoping meetings are required by the National Environmental Policy Act of 1969 (NEPA), and;
  • Maintaining a licensing handbook which contains guidelines for preparing Exhibit E drawings, the environmental information exhibit required to be included with each application.


The Commission uses an environmental measures effectiveness database that tracks the success of environmental requirements in licenses. This tracking capability is in the pilot program stage and when completed will be capable of storing the requirements and the results of monitoring studies conducted to verify whether the license requirements are working to achieve their desired result.

The Commission is committed to reducing the time and cost of hydropower licensing without compromising environmental protection. Commission licenses are issued for a minimum term of 30 years, and a maximum term of 50 years.

Company X wants to build a dam on a waterfall where many fish and wildlife live. The dam will create energy for many families living in the area. Some people are protesting the building of the dam because they say it will harm the natural beauty of the waterfall, but other people are talking about how much energy the dam will create. Think about the pros and cons of building that hydroelectric dam. That's what people at FERC do everyday. What do you think?

With respect to Natural Gas projects, FERC safeguards the environment by:

  • Disclosing, analyzing and minimizing impacts where it is feasible and reasonable to do so;
  • Encourage applicants to communicate with relevant federal and state natural resources agencies, Indian tribes, and state water quality agencies, prior to submitting an application;
  • Ensuring that all applicants perform the necessary studies to make an informed decision on the project;
  • Issuing environmental assessments (EA) or draft and final environmental impact statement (EIS) for comment on most projects;
  • Including requirements with any certificate issued to reduce environmental impacts; and
  • Inspecting proposed project areas to determine the range of environmental issues requiring analysis and holding scoping meetings as appropriate.

Here is an illustration of the environmental review of gas pipelines.

Some important terms:

NEPA. The National Environmental Policy Act of 1969 requires the Commission and resource agency staff to analyze environmental impacts on proposed projects and alternatives to be considered and to provide appropriate mitigation measures.

Protection, Mitigation and Enhancement (PM&E) measures. Terms and conditions to protect or improve recreation, fisheries, wildlife, water quality, wetlands, or cultural resources which have economic as well as aesthetic value.

Environmental Impact Statement. A document prepared to describe the effects of proposed activities on the environment. When preparing and EIS, land, water, air, structures, living organisms, environmental values at the site, and the social, cultural, and economic aspects are considered. An impact is a consequence that results from an activity. Impacts can be positive or negative or both. An EIS describes impacts, as well as ways to manage impacts. Managing impacts means lessening or removing negative impacts. Federal laws and regulations require the federal government to evaluate the effects of its actions on the environment and to consider alternative courses of action. NEPA specifies when an EIS must be prepared.

Environmental Assessment. An environmental assessment (EA) is a comprehensive and systematic process designed to identify, analyze and evaluate the environmental effects of proposed projects. EA preparation involves the public in an open and participatory manner and allows for the effective integration of environmental considerations and public concerns.

Cultural Resources. Districts, sites, structures, and objects and evidence of some importance to a culture, a subculture, or a community for scientific, traditional, religious, and other reasons. These resources and relevant environmental data are important for describing and reconstructing past lifeways, for interpreting human behavior, and for predicting future courses of cultural development.