Policy Statement Regarding Certification of New Interstate Natural Gas Facilities

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UNITED STATES OF AMERICA

FEDERAL ENERGY REGULATORY COMMISSION

[Docket No. PL18-1-000]

Certification of New Interstate Natural Gas Facilities

(Issued February 18, 2022)

AGENCY: Federal Energy Regulatory Commission.

ACTION: Updated Policy Statement on Certification of New Interstate Natural Gas

Facilities.

SUMMARY: This Updated Policy Statement describes how the Commission will evaluate

all factors bearing on the public interest in determining whether a new interstate natural gas

transportation project is required by the public convenience and necessity under the Natural

Gas Act.

DATES: Comments that pertain to the Paperwork Reduction Act are due [60 days after

publication in the Federal Register].

FOR FURTHER INFORMATION CONTACT:

Paige Espy (Legal Information)

Office of the General Counsel

888 First Street, NE

Washington, DC 20426

(202) 502-6698

Paige.Espy@ferc.gov

Brandon Cherry (Technical Information)

Office of Energy Projects

Docket No. PL18-1-000

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Federal Energy Regulatory Commission

888 First Street, NE

Washington, DC 20426

(202) 502-8328

Brandon.Cherry@ferc.gov

SUPPLEMENTARY INFORMATION:

178 FERC ¶ 61,107

UNITED STATES OF AMERICA

FEDERAL ENERGY REGULATORY COMMISSION

Before Commissioners: Richard Glick, Chairman;

James P. Danly, Allison Clements,

Mark C. Christie, and Willie L. Phillips.

Certification of New Interstate Natural Gas Facilities

Docket No. PL18-1-000

UPDATED POLICY STATEMENT ON

CERTIFICATION OF NEW INTERSTATE NATURAL GAS FACILITIES

(Issued February 18, 2022)

ssioners: Richard Glick, Chairman;

James P. Danly, Allison Clements,

Mark C. Christie, and Willie L. Phillips.

Certification of New Interstate Natural Gas Facilities

Docket No. PL18-1-000

UPDATED POLICY STATEMENT ON

CERTIFICATION OF NEW INTERSTATE NATURAL GAS FACILITIES

(Issued February 18, 2022)

On April 19, 2018, and February 18, 2021, the Commission issued Notices of

Inquiry (NOI)1 to help the Commission explore whether, and if so how, it should revise

the approach established by its currently effective policy statement on the certification of

new interstate natural gas transportation facilities (1999 Policy Statement)2 to determine

whether a proposed natural gas project “is or will be required by the present or future

public convenience and necessity,” as that standard is established in section 7 of the

Natural Gas Act (NGA).3

1 Certification of New Interstate Natural Gas Facilities, 83 FR 18020 (Apr. 25,

2018), 163 FERC ¶ 61,042 (2018); Certification of New Interstate Natural Gas Facilities,

86 FR 11268 (Feb. 24, 2021), 174 FERC ¶ 61,125 (2021).

2 Certification of New Interstate Natural Gas Pipeline Facilities, 88 FERC ¶ 61,227

(1999), clarified, 90 FERC ¶ 61,128, further clarified, 92 FERC ¶ 61,094 (2000) (1999

Policy Statement).

3 15 U.S.C. 717f(e).

Docket No. PL18-1-000

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Based on the comments received in this proceeding and the significant changes

that have occurred since issuance of the 1999 Policy Statement, and in order to provide

stakeholders with more clarity on the Commission’s decision-making process, we are

issuing this Updated Certificate Policy Statement (Updated Policy Statement).

This Updated Policy Statement does not establish binding rules and is intended to

explain how the Commission will consider applications to construct new interstate

natural gas transportation facilities.

Background

Statutory Authority and Obligations

on the Commission’s decision-making process, we are

issuing this Updated Certificate Policy Statement (Updated Policy Statement).

This Updated Policy Statement does not establish binding rules and is intended to

explain how the Commission will consider applications to construct new interstate

natural gas transportation facilities.

Background

Statutory Authority and Obligations

Section 7 of the NGA authorizes the Commission to issue certificates of public

convenience and necessity for the construction and operation of facilities transporting

natural gas in interstate commerce.4 Under section 7(e), the Commission shall issue a

certificate to any qualified applicant upon finding that the construction and operation of a

proposed project “is or will be required by the present or future public convenience and

necessity.”5 The public convenience and necessity standard encompasses all factors

bearing on the public interest.6

4 Id. 717f.

5 Id. 717f(e).

6 Atl. Ref. Co. v. Pub. Serv. Comm’n of N.Y., 360 U.S. 378, 391 (1959) (“This is

not to say that rates are the only factor bearing on the public convenience and necessity,

for [section] 7(e) requires the Commission to evaluate all factors bearing on the public

interest.”).

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The NGA authorizes the Commission to attach to a certificate “such reasonable

terms and conditions as the public convenience and necessity may require.”7 The

Commission can also deny an application for a certificate if a balancing of all public

interest factors weighs against authorization of the proposed project.8 If an applicant

receives a certificate from the Commission, section 7(h) of the NGA authorizes the

certificate holder to acquire the property rights necessary to construct and operate its

project by use of eminent domain if it cannot reach an agreement with a landowner.9

for a certificate if a balancing of all public

interest factors weighs against authorization of the proposed project.8 If an applicant

receives a certificate from the Commission, section 7(h) of the NGA authorizes the

certificate holder to acquire the property rights necessary to construct and operate its

project by use of eminent domain if it cannot reach an agreement with a landowner.9

The Commission’s consideration of an application generally triggers

environmental review under the National Environmental Policy Act of 1969 (NEPA).10

NEPA and its implementing regulations require that, before taking or authorizing a major

federal action that may significantly affect the quality of the human environment, federal

agencies take a “hard look” at the environmental consequences of the proposed action

and disclose their analyses to the public.11 NEPA also requires that agencies consider

whether there are steps that could be taken to mitigate any adverse environmental

7 15 U.S.C. 717f(e).

8 See, e.g., FPC v. Transcon. Gas Pipe Line Corp., 365 U.S. 1, 17 (1961) (the

Commission “can only exercise a veto power over proposed transportation . . . when a

balance of all the circumstances weighs against certification”).

9 15 U.S.C. 717f(h).

10 42 U.S.C. 4321-4370j.

11 Id. 4332(2)(C); 40 CFR 1500.1-1508.1; Baltimore Gas & Elec. Co. v. Nat. Res.

Def. Council, Inc., 462 U.S. 87, 97 (1983) (discussing the twin aims of NEPA—to

consider environmental impacts and to disclose the agency’s consideration to the public).

transportation . . . when a

balance of all the circumstances weighs against certification”).

9 15 U.S.C. 717f(h).

10 42 U.S.C. 4321-4370j.

11 Id. 4332(2)(C); 40 CFR 1500.1-1508.1; Baltimore Gas & Elec. Co. v. Nat. Res.

Def. Council, Inc., 462 U.S. 87, 97 (1983) (discussing the twin aims of NEPA—to

consider environmental impacts and to disclose the agency’s consideration to the public).

Docket No. PL18-1-000

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consequences.12 While NEPA is a procedural statute and does not require an agency to

reject a proposed project based on its adverse effects or to take action to mitigate those

effects,13 an agency may require mitigation measures as a condition of its approval under

the NGA,14 or withhold approval based on significant adverse effects.15

Historical Context and the 1999 Certificate Policy Statement

From the enactment of the NGA in 1938 to the 1990s, as a result of statutory and

regulatory revisions, the natural gas industry evolved away from a system of limited

competition among vertically integrated companies selling bundled commodity and

transportation services at Commission-regulated prices to one where pipelines provide

open-access transportation of gas supplies purchased pursuant to non-Commission

regulated agreements between producers and other parties. Consequently, consumers

12 Robertson v. Methow Valley Citizens Council, 490 U.S. 332, 351 (1989) (“To be

sure, one important ingredient of an [environmental impact statement] is the discussion of

steps that can be taken to mitigate adverse environmental consequences.”).

13 Id. at 352 (“There is a fundamental distinction, however, between a requirement

that mitigation be discussed in sufficient detail to ensure that environmental consequences

have been fairly evaluated, on the one hand, and a substantive requirement that a complete

mitigation plan be actually formulated and adopted, on the other.”); see also Baltimore

Gas & Elec. Co., 462 U.S. at 97 (citing Stryckers’ Bay Neighborhood Council v

tal distinction, however, between a requirement

that mitigation be discussed in sufficient detail to ensure that environmental consequences

have been fairly evaluated, on the one hand, and a substantive requirement that a complete

mitigation plan be actually formulated and adopted, on the other.”); see also Baltimore

Gas & Elec. Co., 462 U.S. at 97 (citing Stryckers’ Bay Neighborhood Council v. Karlen,

444 U.S. 223, 227 (1980)).

14 Final Guidance for Federal Departments and Agencies on the Appropriate Use

of Mitigation and Monitoring and Clarifying the Appropriate use of Mitigated Findings

of No Significant Impact, 76 FR 3843, 3848 (Jan. 21, 2011).

15 See, e.g., Sierra Club v. FERC, 867 F.3d 1357, 1373 (D.C. Cir. 2017) (Sabal

Trail) (explaining that the Commission may “deny a pipeline certificate on the ground

that the pipeline would be too harmful to the environment”).

Docket No. PL18-1-000

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benefitted from competition among non-pipeline entities in an unregulated commodity

market and from competition among pipeline companies providing open-access,

unbundled transportation services at Commission-regulated rates or, if authorized under

certain circumstances, market-based rates.

At the same time that natural gas commodity and transportation markets were

becoming more competitive, the 1990s saw significant growth in natural gas consumption

in the industrial and electric generation sectors. The resultant expansion of the pipeline

system to meet this demand raised issues as to who should bear the costs of new

construction. Before the Commission adopted the 1999 Policy Statement, the

Commission’s pricing policy for new construction generally allowed for the costs of

expansion projects to be rolled into a pipeline company’s existing system costs to derive

rolled-in rates in a future rate case under section 4 of the NGA.16 All shippers bore some

burden of the expansion project’s cost, regardless of whether they would benefit from the

project

the 1999 Policy Statement, the

Commission’s pricing policy for new construction generally allowed for the costs of

expansion projects to be rolled into a pipeline company’s existing system costs to derive

rolled-in rates in a future rate case under section 4 of the NGA.16 All shippers bore some

burden of the expansion project’s cost, regardless of whether they would benefit from the

project. Local distribution companies (LDC) and other parties believed that this pricing

policy sent the wrong price signals by masking the real costs of an expansion project and

could result in overbuilding and subsidization of expansion by a pipeline’s existing

shippers.

16 Pricing Policy for New and Existing Facilities Constructed by Interstate

Natural Gas Pipelines, 71 FERC ¶ 61,241 (1995), order on reh’g, 75 FERC ¶ 61,105

(1996). Under this pricing policy, expansion projects received a determination for rolled-

in pricing upon a showing that the new costs would not increase existing rates by more

than five percent.

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In response to these and other concerns, in 1998, the Commission issued a Notice

of Proposed Rulemaking17 and an NOI18 to explore issues related to its policies on the

certification and pricing of new pipeline projects. Based on the information received

from stakeholders in response to these notices, the Commission issued the 1999 Policy

Statement “to foster competitive markets, protect captive customers, and avoid

unnecessary environmental and community impacts while serving increasing demands

for natural gas.”19 These objectives were realized primarily by a shift from a

presumption of rolled-in pricing to a presumption of incremental pricing.20 Under

incremental pricing, existing customers using only existing facilities do not subsidize the

cost of constructing and operating new projects.21

unnecessary environmental and community impacts while serving increasing demands

for natural gas.”19 These objectives were realized primarily by a shift from a

presumption of rolled-in pricing to a presumption of incremental pricing.20 Under

incremental pricing, existing customers using only existing facilities do not subsidize the

cost of constructing and operating new projects.21

10.

Pursuant to the 1999 Policy Statement, when reviewing applications to construct

new interstate transportation facilities the Commission would first determine whether a

17 Regulation of Short-Term Natural Gas Transportation Services, Notice of

Proposed Rulemaking, 63 FR 42,982 (July 29, 1998), FERC Stats. & Regs. ¶ 32,533

(1998) (cross-referenced at 84 FERC ¶ 61,085).

18 Regulation of Interstate Natural Gas Transportation Services, NOI, 63 FR

42974 (Aug. 9, 1998), FERC Stats. & Regs. ¶ 35,533 (1998) (cross-referenced at 84

FERC ¶ 61,087).

19 1999 Policy Statement, 88 FERC at 61,743.

20 Although incremental pricing was presumed, an applicant could demonstrate

that a proposed project qualified for a pre-determination of rolled-in rate treatment

through showing that inexpensive expansibility was made possible because of earlier,

costly construction or that the project was designed to improve existing service for

existing customers. Id. at 61,746 and n.12.

21 Id. at 61,746.

Docket No. PL18-1-000

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threshold requirement of no financial subsidization from existing customers was met. If

so, the Commission would next consider whether the applicant eliminated or minimized

any residual adverse effects the project might have on: (1) the applicant’s existing

customers; (2) existing pipelines in the market and their captive customers; and

21 Id. at 61,746.

Docket No. PL18-1-000

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threshold requirement of no financial subsidization from existing customers was met. If

so, the Commission would next consider whether the applicant eliminated or minimized

any residual adverse effects the project might have on: (1) the applicant’s existing

customers; (2) existing pipelines in the market and their captive customers; and

(3) landowners and communities affected by the proposed project.22 Any residual

adverse effects would be balanced against the anticipated benefits from the project.23

The Commission allowed an applicant to rely on a variety of factors to demonstrate that

its proposed project was needed,24 but, in practice, applicants generally elected to submit,

and the Commission accepted, precedent agreements with prospective customers for

long-term firm service as the principal factor in demonstrating project need.

11.

The 1999 Policy Statement introduced a sliding scale approach to balance public

benefits with adverse effects, where the “more interests adversely affected or the more

adverse impact a project would have on a particular interest, the greater the showing of

public benefits from the project required to balance the adverse impact.”25 The

1999 Policy Statement provided that, if the Commission found that project benefits

22 Id. at 61,745.

23 Id. at 61,748.

24 Id. at 61,747.

25 Id. at 61,749.

Docket No. PL18-1-000

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outweighed adverse impacts on economic interests, then the Commission would proceed

to consider the environmental impacts of the project.26

Developments after Issuance of the 1999 Certificate Policy Statement

12.

Much has changed since the Commission issued the 1999 Policy Statement

22 Id. at 61,745.

23 Id. at 61,748.

24 Id. at 61,747.

25 Id. at 61,749.

Docket No. PL18-1-000

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outweighed adverse impacts on economic interests, then the Commission would proceed

to consider the environmental impacts of the project.26

Developments after Issuance of the 1999 Certificate Policy Statement

12.

Much has changed since the Commission issued the 1999 Policy Statement. In the

last decade, increases in both domestic and international demand for natural gas produced

in the United States, combined with the available supply of competitively-priced gas

from shale reserves, have reduced prices and price volatility and have resulted in more

proposals for natural gas transportation and export projects.27 Much of the increased

production is attributable to the development of the Marcellus and Utica shale formations

in Pennsylvania, West Virginia, Ohio, and New York; shale formations in the Permian

Basin in West Texas and Eastern New Mexico; Eagle Ford Shale in South Texas; and

Bakken Shale Formation in North Dakota, among others; as well as associated new

extraction technologies.

13.

Contracting patterns are changing significantly as a result of this supply growth.

In the past, LDCs contracted for a large percentage of interstate pipeline capacity,

26 Id. at 61,745-46. While the Commission only moved to the stage of balancing

environmental impacts and other considerations if a proposed project passed this

economic test established by the 1999 Policy Statement, Commission staff would begin

review of the environmental impacts following the filing of an application. If a project

did not pass this economic test, it could be rejected without further consideration of

environmental factors.

27 In the early 2000s, there were a number of proposals for natural gas import

projects. However, as natural gas supplies increased and prices decreased, the

Commission began to see more proposals for natural gas export projects.

owing the filing of an application. If a project

did not pass this economic test, it could be rejected without further consideration of

environmental factors.

27 In the early 2000s, there were a number of proposals for natural gas import

projects. However, as natural gas supplies increased and prices decreased, the

Commission began to see more proposals for natural gas export projects.

Docket No. PL18-1-000

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obtaining supplies from the production area for their customers. Increasingly, however,

LDCs are purchasing gas supplies further downstream at market area pooling points or at

their city gates as other parties increasingly contract for pipeline capacity. Natural gas

producers are now contracting for a significant amount of firm pipeline capacity on

expansion projects in an effort to provide a secured commercial outlet for their gas.

14.

Over the past decade, there has been greater interest and participation by affected

landowners and communities, Tribes, environmental organizations, and others in natural

gas project proceedings. Part of this may be attributable to the increase in proposals for

new natural gas infrastructure in more densely populated areas of the eastern half of the

nation. These stakeholders have raised various concerns with, among other things, the

use of eminent domain, the need for new projects, and the environmental impacts of

project construction and operation, including impacts on climate change and

environmental justice communities.

15.

The Commission’s consideration of climate change and greenhouse gas emissions

(GHG) has also evolved since issuance of the 1999 Policy Statement

various concerns with, among other things, the

use of eminent domain, the need for new projects, and the environmental impacts of

project construction and operation, including impacts on climate change and

environmental justice communities.

15.

The Commission’s consideration of climate change and greenhouse gas emissions

(GHG) has also evolved since issuance of the 1999 Policy Statement. In the last decade,

the Commission began including estimates of GHG emissions from project construction

(e.g., tailpipe emissions from construction equipment) and operation (e.g., fuel combustion

at compressor stations and gas venting and leaks) in its NEPA documents.28 Then, starting

28 See, e.g., Environmental Assessment for the Philadelphia Lateral Expansion

Project, Docket No. CP11-508-000, at 24 (Jan. 18, 2012) (construction emissions);

Environmental Assessment for the Minisink Compressor Project, Docket No. CP11-515-

000, at 29 (Feb. 29, 2012) (operation emissions).

Docket No. PL18-1-000

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in late 2016, the Commission began to estimate GHG emissions from downstream

combustion and upstream production.29 In 2018, however, the Commission reversed this

practice,30 resulting in a number of judicial decisions finding fault with the Commission’s

approach.31 Concurrent with this Updated Policy Statement, the Commission is issuing a

new policy statement to explain how it will assess project impacts on climate change in its

NEPA and NGA reviews going forward (GHG Policy Statement).32

16.

Another development since issuance of the 1999 Policy Statement is an increasing

recognition of the need for federal agencies to focus on environmental justice and equity

ent with this Updated Policy Statement, the Commission is issuing a

new policy statement to explain how it will assess project impacts on climate change in its

NEPA and NGA reviews going forward (GHG Policy Statement).32

16.

Another development since issuance of the 1999 Policy Statement is an increasing

recognition of the need for federal agencies to focus on environmental justice and equity.

In 1994, under Executive Order 12898, agencies were directed to identify and address

“disproportionately high and adverse human health or environmental effects” of their

actions on minority and low-income populations (i.e., environmental justice

communities).33 In 2021, President Biden issued two executive orders to renew and

expand upon this directive. Specifically, Executive Order 13985, issued on

29 See, e.g., Columbia Gas Transmission, LLC, 158 FERC ¶ 61,046, at PP 116-120

(2017); Tex. E. Transmission, LP, 157 FERC ¶ 61,223, at P 41 (2016), reh’g granted,

161 FERC ¶ 61,226 (2017).

30 Dominion Transmission, Inc., 163 FERC ¶ 61,128 (2018), pet. dismissed,

Otsego 2000 v. FERC, 767 F.App’x 19 (D.C. Cir. 2019) (unpublished opinion).

31 See infra P 70.

32 Consideration of Greenhouse Gas Emissions in Natural Gas Infrastructure

Project Reviews, 178 FERC ¶ 61,108 (2022) (GHG Policy Statement).

33 E.O. 12898, Federal Actions to Address Environmental Justice in Minority

Populations and Low-Income Populations, 59 FR 7629, at 7629, 7632 (Feb. 11, 1994).

sego 2000 v. FERC, 767 F.App’x 19 (D.C. Cir. 2019) (unpublished opinion).

31 See infra P 70.

32 Consideration of Greenhouse Gas Emissions in Natural Gas Infrastructure

Project Reviews, 178 FERC ¶ 61,108 (2022) (GHG Policy Statement).

33 E.O. 12898, Federal Actions to Address Environmental Justice in Minority

Populations and Low-Income Populations, 59 FR 7629, at 7629, 7632 (Feb. 11, 1994).

Docket No. PL18-1-000

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January 20, 2021, requires agencies to conduct Equity Assessments to identify and

remove barriers to underserved communities and “to increase coordination,

communication, and engagement with community-based organizations and civil rights

organizations.”34 And Executive Order 14008, issued on January 27, 2021, directs

agencies to develop “programs, policies, and activities to address the disproportionately

high and adverse human health, environmental, climate-related and other cumulative

impacts on disadvantaged communities, as well as the accompanying economic

challenges of such impacts.”35

II.

Notices of Inquiry and Comments

17.

As noted above, on April 19, 2018, the Commission issued an NOI (2018 NOI)

seeking information and stakeholder perspectives to help the Commission explore

whether, and if so how, it should revise the approach established by the 1999 Policy

Statement. The Commission identified four general areas for examination in the 2018

NOI: (1) the reliance on precedent agreements to demonstrate need for a proposed

project; (2) the potential exercise of eminent domain and landowner interests; (3) the

Commission’s evaluation of alternatives and environmental effects under NEPA and the

NGA; and (4) the efficiency and effectiveness of the Commission’s certificate processes.

34 E.O. 13985, Advancing Racial Equity and Support for Underserved

Communities Through the Federal Government, 86 FR 7009, 7010-11.

35 E.O

; (2) the potential exercise of eminent domain and landowner interests; (3) the

Commission’s evaluation of alternatives and environmental effects under NEPA and the

NGA; and (4) the efficiency and effectiveness of the Commission’s certificate processes.

34 E.O. 13985, Advancing Racial Equity and Support for Underserved

Communities Through the Federal Government, 86 FR 7009, 7010-11.

35 E.O. 14008, Tackling the Climate Crisis at Home and Abroad, 86 FR 7619,

7629; see also The White House, Fact Sheet: President Biden Takes Executive Actions to

Tackle the Climate Crisis at Home and Abroad, Create Jobs, and Restore Scientific

Integrity Across Federal Government (2021).

Docket No. PL18-1-000

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In response to the 2018 NOI, the Commission received more than 3,000 comments from

a diverse range of stakeholders.

18.

On February 18, 2021, the Commission issued another NOI (2021 NOI) seeking to

build upon the existing record established by the 2018 NOI. The 2021 NOI noted that a

number of changes had occurred since the Commission issued the 2018 NOI, including

regulatory changes, the issuance of new executive orders, and increased stakeholder

interest in certain topics. Accordingly, the 2021 NOI provided stakeholders with an

opportunity to refresh the record and provide updated information and additional

viewpoints to help the Commission assess its policy.

19.

The 2021 NOI included the four general areas of examination identified in the

2018 NOI, with modifications to the specific questions asked, including new questions on

how the Commission should assess and consider the impacts of proposed projects on

climate change

ty to refresh the record and provide updated information and additional

viewpoints to help the Commission assess its policy.

19.

The 2021 NOI included the four general areas of examination identified in the

2018 NOI, with modifications to the specific questions asked, including new questions on

how the Commission should assess and consider the impacts of proposed projects on

climate change. The 2021 NOI also identified a fifth area of examination—the

Commission’s identification and consideration of disproportionately high and adverse

human health or environmental effects of its programs, policies, and activities on

environmental justice communities and the mitigation of those adverse impacts and

burdens, as well as the Commission’s identification of potentially affected environmental

justice communities and measures for ensuring effective participation by these

communities in the certificate review process. In response to the 2021 NOI, the

Commission received more than 35,000 comments, including more than 150 unique

comment letters, from a diverse range of stakeholders.

Docket No. PL18-1-000

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20.

The comments received in response to the 2018 and 2021 NOIs are summarized at

a high level below. Comments related to GHG emissions are summarized in the

aforementioned GHG Policy Statement.36 The considerable number of comments

submitted in this proceeding indicates substantial public interest in the Commission’s

policy for reviewing proposed interstate natural gas facilities.

The Commission’s Determination of Need

21.

A wide range of commenters request that the Commission change how it makes its

public need determination

rized in the

aforementioned GHG Policy Statement.36 The considerable number of comments

submitted in this proceeding indicates substantial public interest in the Commission’s

policy for reviewing proposed interstate natural gas facilities.

The Commission’s Determination of Need

21.

A wide range of commenters request that the Commission change how it makes its

public need determination. Many of these commenters argue that the Commission should

rely less on precedent agreements.37 Additionally, commenters request that, in assessing

need, there be greater consideration of climate change impacts,38 increased

transparency,39 and an enlarged participatory role for stakeholders.40 Some commenters

recommend that applicants be required to provide specific evidence that need exists, the

36 GHG Policy Statement, 178 FERC ¶ 61,108.

37 E.g., Public Interest Organizations (PIO) 2021 Comments at 12; Delaware

Riverkeeper Network 2018 Comments at 67; Friends of the Central Shenandoah 2018

Comments at 36-38. The PIO 2021 Comments represent 54 entities from around the

country that advocate for the protection of environmental resources, including Natural

Resources Defense Council, Sierra Club, Public Citizen, Conservation Law Foundation,

and Southern Environmental Law Center.

38 See, e.g., Environmental Protection Agency (EPA) 2021 Comments at 1-2.

39 E.g., New Jersey Conservation Foundation, Sabin Center for Climate Change

Law, Watershed Institute, Clean Air Council, PennFuture, and New Jersey League of

Conservation Voters (collectively, New Jersey Conservation Foundation et al.) 2021

Comments at 31-32.

40 E.g., Ann W. Woll 2021 Comments at 1; Jessica Greenwood 2021 Comments

at 1; Rev. Betsy Sowers 2021 Comments at 1.

omments at 1-2.

39 E.g., New Jersey Conservation Foundation, Sabin Center for Climate Change

Law, Watershed Institute, Clean Air Council, PennFuture, and New Jersey League of

Conservation Voters (collectively, New Jersey Conservation Foundation et al.) 2021

Comments at 31-32.

40 E.g., Ann W. Woll 2021 Comments at 1; Jessica Greenwood 2021 Comments

at 1; Rev. Betsy Sowers 2021 Comments at 1.

Docket No. PL18-1-000

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proposed facilities serve that need, and the asserted need cannot be met by existing

infrastructure.41 In contrast, regulated companies and industry trade organizations are

nearly unanimous in their general support of the 1999 Policy Statement as it relates to the

public need determination.42

22.

Several commenters argue that the public benefits recognized in the 1999 Policy

Statement are skewed, overly narrow, and outdated.43 Additionally, some commenters

recommend that the Commission create clear guidelines for benefits like reliability and

resilience.44 Some commenters suggest that the Commission consider additional factors

in its benefits analysis, such as infrastructure security and how an applicant’s proposal

fits with, or advances, new federal and state policies and goals.45 In contrast, industry

trade organizations generally support the Commission’s existing benefits analysis under

the 1999 Policy Statement, arguing that the Commission’s responsibilities under the

NGA have not changed, and, thus, any changes to the Commission’s review of public

benefits should not impede those responsibilities.46 However, some regulated companies

41 E.g., Environmental Defense Fund (EDF) 2021 Comments at 8-12.

42 See, e.g., American Gas Association (AGA) 2021 Comments at 10-11.

43 See, e.g., Delaware Riverkeeper Network & Berks Gas Truth 2021 Comments

at 4.

44 E.g., EDF 2021 Comments at 18.

45 See, e.g., New Jersey Division of Rate Counsel 2021 Comments at 4-8.

46 See, e.g., Natural Gas Supply Association (NGSA) 2021 Comments at 23.

.g., Environmental Defense Fund (EDF) 2021 Comments at 8-12.

42 See, e.g., American Gas Association (AGA) 2021 Comments at 10-11.

43 See, e.g., Delaware Riverkeeper Network & Berks Gas Truth 2021 Comments

at 4.

44 E.g., EDF 2021 Comments at 18.

45 See, e.g., New Jersey Division of Rate Counsel 2021 Comments at 4-8.

46 See, e.g., Natural Gas Supply Association (NGSA) 2021 Comments at 23.

Docket No. PL18-1-000

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recommend that the Commission more heavily weigh certain benefits, such as reliability

and resilience, in light of recent extreme cold weather events and ransomware attacks.47

23.

Regarding what evidence the Commission should examine to determine project

need, many non-governmental organizations (NGO), individual commenters, and other

entities argue that the Commission should analyze factors beyond precedent agreements,

such as future markets, opportunity costs, federal and state public policies, and effects on

competition.48 NGOs request that the Commission take a more “holistic” approach and

assess proposed projects in conjunction with other projects that are designed to serve the

same market, serve similar markets, or pass through the same region,49 and that there be

increased coordination with state agencies, including allowing state regulators to review

and approve precedent agreements prior to the Commission making a need

determination.50 In contrast, regulated companies and industry trade organizations state

that precedent agreements remain powerful indicators of need, as they represent long-

47 Iroquois Gas Transmission System, L.P. (Iroquois) 2021 Comments at 10-11.

48 See, e.g., Niskanen Center, Hopewell Township, Horizons Village Property

Owners Association, Inc., and 28 affected landowners (collectively, Niskanen Center

et al.) 2021 Comments at 18; Delaware Riverkeeper Network & Berks Gas Truth 2021

Comments at 9; New Jersey Division of Rate Counsel 2021 Comments at 8-9; Carolyn

Elefant 2021 Comments at 2-3.

49 PIO 2018 Comments at 10

s at 10-11.

48 See, e.g., Niskanen Center, Hopewell Township, Horizons Village Property

Owners Association, Inc., and 28 affected landowners (collectively, Niskanen Center

et al.) 2021 Comments at 18; Delaware Riverkeeper Network & Berks Gas Truth 2021

Comments at 9; New Jersey Division of Rate Counsel 2021 Comments at 8-9; Carolyn

Elefant 2021 Comments at 2-3.

49 PIO 2018 Comments at 10. The PIO 2018 Comments represent 64 entities from

around the country that advocate for the protection of environmental resources; many of

these entities also signed on to the PIO 2021 Comments.

50 Delaware Riverkeeper Network & Berks Gas Truth 2021 Comments at 18.

Docket No. PL18-1-000

- 16 -

term, binding contractual and financial commitments to a project and are more objective

evidence than market studies.51

24.

Several commenters recommend that when applicants provide precedent

agreements with affiliates as evidence of need, the Commission look beyond those

agreements, given that companies with common profit interests might have incentives to

inflate costs which can then be passed on to captive ratepayers.52 Additionally, several

commenters argue that the terms of precedent agreements should be subject to close

scrutiny53 and that the Commission should consider the potential for an asset to be

rendered obsolete before the end of its useful life, as well as the length of time over

which an asset’s costs are recovered.54 In contrast, regulated companies and industry

trade organizations argue that the Commission should not distinguish between affiliate

and non-affiliate agreements, as standards of conduct and nondiscrimination require

51 See, e.g., WBI Energy Transmission, Inc. (WBI Energy) 2021 Comments at 3;

National Fuel Gas Supply Corporation (National Fuel) 2021 Comments at 9; Energy

Transfer LP 2021 Comments at 4-5; Interstate Natural Gas Association of America

(INGAA) 2021 Comments at 17-19; Boardwalk Pipeline Partners LP (Boardwalk) 2021

Comments at 28

ements, as standards of conduct and nondiscrimination require

51 See, e.g., WBI Energy Transmission, Inc. (WBI Energy) 2021 Comments at 3;

National Fuel Gas Supply Corporation (National Fuel) 2021 Comments at 9; Energy

Transfer LP 2021 Comments at 4-5; Interstate Natural Gas Association of America

(INGAA) 2021 Comments at 17-19; Boardwalk Pipeline Partners LP (Boardwalk) 2021

Comments at 28.

52 See, e.g., Natural Resources Defense Council, Sierra Club, Earthjustice,

GreenFaith, Southern Environmental Law Center, Conservation Law Foundation, Public

Citizen, Catskill Mountainkeeper, New Jersey Conservation Foundation, Riverkeeper,

Inc., and Acadia Center (collectively, Joint NGOs) April 2018 Comments at 2; Jim Steitz

2018 Comments at 2.

53 See, e.g., Friends of the Central Shenandoah 2018 Comments at 47-49; Upstate

Forever 2018 Comments at 2.

54 New Jersey Division of Rate Counsel 2021 Comments at 10.

Docket No. PL18-1-000

- 17 -

pipeline companies to treat all customers equitably, regardless of whether the customer is

an affiliate or a non-affiliate.55 These entities allege that economic risk, financial

obligation, and oversight by state and local regulators associated with precedent

agreements demonstrate that they are clear evidence of need, regardless of whether the

shipper is an affiliate.56

25.

A wide range of commenters assert that the Commission must consider the end

use of the natural gas to be transported in its assessment of need, even if end use could

change over time.57 Some commenters also note that climate change issues cannot be

appropriately addressed without a firm understanding of end use.58 However, regulated

companies and industry trade organizations argue against consideration of expected end

use given the practical challenges of dynamic gas markets,59 the Commission’s

regulations prohibiting pipelines from unduly discriminating among shippers based on

55 See, e.g., WBI Energy 2021 Comments at 5; INGAA 2021 Comments at 19-20;

DTE Energy Company 2018 Co

tanding of end use.58 However, regulated

companies and industry trade organizations argue against consideration of expected end

use given the practical challenges of dynamic gas markets,59 the Commission’s

regulations prohibiting pipelines from unduly discriminating among shippers based on

55 See, e.g., WBI Energy 2021 Comments at 5; INGAA 2021 Comments at 19-20;

DTE Energy Company 2018 Comments at 5; Iroquois 2018 Comments at 12-13.

56 E.g., WBI Energy 2021 Comments at 5.

57 See, e.g., Delaware Riverkeeper Network & Berks Gas Truth 2021 Comments

at 29-32; Deb Evans and Rob Schaaf 2018 Comments at 3-5.

58 E.g., Fore River Residents Against the Compressor Station, Inc. (FRRACS)

2021 Comments at 2.

59 Enbridge Gas Pipelines (Enbridge) 2021 Comments at 46; WBI Energy 2021

Comments at 6.

Docket No. PL18-1-000

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end use,60 and the fact that regulating end use is outside the scope of the Commission’s

statutory authority.61

26.

Many commenters recommend that the Commission assess need in a regional

planning context, including consideration of existing infrastructure, in order to avoid

unnecessary environmental harm, “underutilized or stranded” assets, and needlessly

higher rates for captive consumers.62 Regulated companies and industry trade

organizations, however, generally oppose the Commission using a regional approach to

review natural gas pipeline projects, asserting that this could needlessly delay

construction,63 the proximity of pipeline projects does not necessarily indicate that

projects serve the same need in a region,64 and the open season process already serves to

ensure duplicative projects are not constructed.65 Also, these entities do not support the

Commission further examining whether existing infrastructure could sufficiently meet

demand.66

60 INGAA 2021 Comments at 22 (citing 18 CFR 284.7(b)).

61 Cheniere Energy, Inc. (Cheniere) 2018 Comments at 6

that

projects serve the same need in a region,64 and the open season process already serves to

ensure duplicative projects are not constructed.65 Also, these entities do not support the

Commission further examining whether existing infrastructure could sufficiently meet

demand.66

60 INGAA 2021 Comments at 22 (citing 18 CFR 284.7(b)).

61 Cheniere Energy, Inc. (Cheniere) 2018 Comments at 6.

62 See, e.g., EPA 2021 Comments at 1-3; New Jersey Division of Rate Council

2018 Comments at 13-15; Friends of Central Shenandoah 2018 Comments at 57-59.

63 E.g., INGAA 2021 Comments at 23.

64 E.g., INGAA 2021 Comments at 24.

65 E.g., Cheniere 2018 Comments at 8.

66 See, e.g., Energy Transfer LP 2021 Comments at 6; Iroquois 2021 Comments

at 12.

Docket No. PL18-1-000

- 19 -

27.

Additionally, several commenters assert that the Commission must consider future

demand as facilities age, as well as national and state decarbonization policies and

targets.67 In contrast, regulated companies and industry trade organizations contend that

assessment of future demand is not necessary or prudent, given that sophisticated market

participants already make these calculations, and do not support the Commission

performing a comparative or future-looking analysis of energy sources.68 These entities

emphasize that demand for natural gas projects will be correlated with demand for, and

deployment of, variable energy resources.69

28.

Generally, commenters are split on whether, and if so how, the Commission

should consider the economic, energy security, and social attributes of domestic

production and use of natural gas in reviewing proposed projects. Some regulated

companies state that consideration of these factors should be limited;70 however, others

argue that the Commission should consider attributes such as job creation and tax

revenues.71 Several individuals and NGOs state that the Commission could consider

67 See, e.g., New Jersey Division of Rate Counsel 2021 Comments at 13-14

use of natural gas in reviewing proposed projects. Some regulated

companies state that consideration of these factors should be limited;70 however, others

argue that the Commission should consider attributes such as job creation and tax

revenues.71 Several individuals and NGOs state that the Commission could consider

67 See, e.g., New Jersey Division of Rate Counsel 2021 Comments at 13-14.

68 See, e.g., Williams Companies, Inc. (Williams) 2021 Comments at 14; Enbridge

2021 Comments at 51; INGAA 2021 Comments at 25-26.

69 INGAA 2021 Comments at 25-26; Boardwalk 2021 Comments at 38.

70 E.g., Southern Company Services, Inc. 2021 Comments at 4.

71 See, e.g., Williams 2021 Comments at 11-12; Boardwalk 2021 Comments at

39-40; see also American Forest & Paper Association, Industrial Energy Consumers of

America, Process Gas Consumers Group, and the Fertilizer Institute (collectively,

American Forest & Paper Association et al.) 2021 Comments at 17; INGAA 2021

Docket No. PL18-1-000

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these attributes for particular projects, but that the Commission should then also consider

the costs of natural gas projects associated with increased noise, lowered property values,

lowered air quality, a lowered tax base, and the loss of landowners’ potential use of their

land.72 Commenters also recommend that any need analysis be focused on the specific

benefits of a proposed project rather than hypothetical or general benefits73 and that the

Commission assess the magnitude or extent of both the benefits and burdens of a

proposed project, including whether the jobs created are temporary or permanent, as well

as the proportion of the jobs that will be filled by low- to middle-income local workers.74

The Exercise of Eminent Domain and Landowner Interests

29.

Many commenters suggest that the Commission adjust its approach to considering

the possible use of eminent domain

f both the benefits and burdens of a

proposed project, including whether the jobs created are temporary or permanent, as well

as the proportion of the jobs that will be filled by low- to middle-income local workers.74

The Exercise of Eminent Domain and Landowner Interests

29.

Many commenters suggest that the Commission adjust its approach to considering

the possible use of eminent domain. For example, some commenters assert that eminent

domain should only be an option for projects that can guarantee domestic use or local

benefit, or that the Commission should deny certificates that would rely on eminent

Comments at 26-28; AGA 2021 Comments at 32; United Association of Journeymen and

Apprentices of the Plumbing, Pipe Fitting and Sprinkler Fitting Industry of the United

States and Canada, AFL-CIO (United Association) 2021 Comments at 26-28; NGSA

2021 Comments at 16.

72 See, e.g., PIO 2021 Comments at 12-13; Delaware Riverkeeper Network &

Berks Gas Truth 2021 Comments at 42; Edward Woll 2021 Comments at 2; William F.

Limpert 2021 Comments at 7-8; Massachusetts PipeLine Awareness Network (PLAN)

2021 Comments at 2; Rev. Betsy Sowers 2021 Comments at 2.

73 EDF 2021 Comments at 50.

74 EPA 2021 Comments at 4.

Docket No. PL18-1-000

- 21 -

domain for more than twenty percent of the proposed route.75 In contrast, regulated

companies and industry trade organizations state that the Commission should maintain its

current approach, as it adequately protects landowners from the unnecessary use of

eminent domain by ensuring that only projects that are needed and that do not require

subsidization from existing customers are approved.76 These entities also note that it is

not possible for the Commission to reliably estimate the amount of eminent domain that

will ultimately be used prior to issuance of a certificate.77

, as it adequately protects landowners from the unnecessary use of

eminent domain by ensuring that only projects that are needed and that do not require

subsidization from existing customers are approved.76 These entities also note that it is

not possible for the Commission to reliably estimate the amount of eminent domain that

will ultimately be used prior to issuance of a certificate.77

30.

Some commenters assert that additional measures should be taken to minimize the

use of eminent domain for projects, including routing pipelines in existing utility

corridors when possible, requiring proof that an applicant’s efforts to negotiate with

landowners have failed, or reporting to the Commission each easement as it is agreed

upon.78 However, many regulated companies state that additional measures to minimize

75 See, e.g., Delaware Riverkeeper Network & Berks Gas Truth 2021 Comments

at 43; Upstate Forever 2018 Comments at 3; Jane Twitmyer 2018 Comments at 2;

Franklin Regional Council of Gov’ts 2018 Comments at 2.

76 See, e.g., Boardwalk 2021 Comments at 61-63; TC Energy Corporation 2021

Comments at 16; INGAA 2018 Comments at 56.

77 See, e.g., TC Energy Corporation 2021 Comments at 19; Spectra Energy

Partners LP (Spectra) 2018 Comments at 54; American Petroleum Institute (API) 2018

Comments at 13.

78 See, e.g., William F. Limpert 2021 Comments at 9; Tom Russo 2021 Comments

at 12; Friends of the Central Shenandoah 2018 Comments at 67.

ts at 61-63; TC Energy Corporation 2021

Comments at 16; INGAA 2018 Comments at 56.

77 See, e.g., TC Energy Corporation 2021 Comments at 19; Spectra Energy

Partners LP (Spectra) 2018 Comments at 54; American Petroleum Institute (API) 2018

Comments at 13.

78 See, e.g., William F. Limpert 2021 Comments at 9; Tom Russo 2021 Comments

at 12; Friends of the Central Shenandoah 2018 Comments at 67.

Docket No. PL18-1-000

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the use of eminent domain are unnecessary, as companies have already taken steps to

ensure it is used infrequently.79

31.

Several commenters recommend that the Commission give greater weight to the

concerns of impacted landowners and communities.80 Some assert that landowners have

unequal bargaining power with applicants and that the Commission should consider

whether an applicant’s pre-certificate actions related to landowners demonstrate that the

applicant acted in good faith.81 Additionally, some commenters argue that the

Commission should expand the regulatory definition of “affected landowners” to ensure

all impacted landowners and residents are included in the Commission’s consideration.82

32.

Multiple commenters state that it is the Commission’s responsibility to explain the

certificate process to landowners and to ensure that they have the necessary tools to fully

participate.83 Regulated companies and industry trade organizations support the creation

of the Commission’s Office of Public Participation (OPP) to guide landowners’

79 See, e.g., Cheniere 2021 Comments at 9-10; Kinder Morgan Entities (Kinder

Morgan) 2021 Comments at 18-20; API 2021 Comments at 11-13; INGAA 2021

Comments at 29.

80 EDF 2021 Comments at 5; Dr. Susan F. Tierney 2018 Comments at 8, 46-48.

81 See, e.g., New Jersey Conservation Foundation, Watershed Institute, and Sierra

Club 2018 Comments at 35-36; Jody McCaffree 2018 Comments at 7.

82 See, e.g., Sari DeCesare 2021 Comments at 1; Gary Salata 2021 Comments at 1

Kinder

Morgan) 2021 Comments at 18-20; API 2021 Comments at 11-13; INGAA 2021

Comments at 29.

80 EDF 2021 Comments at 5; Dr. Susan F. Tierney 2018 Comments at 8, 46-48.

81 See, e.g., New Jersey Conservation Foundation, Watershed Institute, and Sierra

Club 2018 Comments at 35-36; Jody McCaffree 2018 Comments at 7.

82 See, e.g., Sari DeCesare 2021 Comments at 1; Gary Salata 2021 Comments at 1.

83 See, e.g., Duke Energy Corporation 2018 Comments at 45; Upstate Forever

2018 Comments at 3.

Docket No. PL18-1-000

- 23 -

understanding of, and participation in, the pipeline development and review process.84

Several commenters recommend that the Commission designate certain staff as non-

decisional to act as official procedural case managers.85

33.

Numerous commenters also recommend changes to the Commission’s process and

resources to assist landowners, including incorporating non-traditional outreach methods

to notify and engage stakeholders early and throughout the process, improving the

Commission’s website and eLibrary system, conducting public meetings and site visits

focused on landowner issues, and providing longer public comment periods.86 Some

commenters propose that the Commission automatically grant all affected landowners

party status to project proceedings, or, at a minimum, provide an updated step-by-step

guide for landowners on how to intervene.87 Industry trade organizations support longer

intervention periods for landowners,88 while some regulated companies argue that the

84 See, e.g., Kinder Morgan 2021 Comments at 20-21; BHE Pipeline Group 2021

Comments at 6-8; INGAA 2021 Comments at 31-32.

85 Tom Russo 2021 Comments at 13; American Midstream Partners LP, Canyon

Midstream Partners LLC, and Cureton Midstream LLC 2018 Comments at 7-8; Giles

County and Roanoke County, Virginia 2018 Comments at 13-14.

86 See, e.g., Carolyn Elefant 2021 Comments at 5-6; Niskanen Center et al

Kinder Morgan 2021 Comments at 20-21; BHE Pipeline Group 2021

Comments at 6-8; INGAA 2021 Comments at 31-32.

85 Tom Russo 2021 Comments at 13; American Midstream Partners LP, Canyon

Midstream Partners LLC, and Cureton Midstream LLC 2018 Comments at 7-8; Giles

County and Roanoke County, Virginia 2018 Comments at 13-14.

86 See, e.g., Carolyn Elefant 2021 Comments at 5-6; Niskanen Center et al. 2021

Comments at 36-38; Kinder Morgan 2021 Comments at 22-26; Friends of Central

Shenandoah 2018 Comments at 69; Spectra 2018 Comments at 5.

87 See Niskanen Center et al. 2021 Comments at 28; Deb Evans and Ron Schaaf

2021 Comments at 13; Carolyn Elefant 2018 Comments at 2-3.

88 See INGAA 2021 Comments at 32.

Docket No. PL18-1-000

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Commission should limit interventions to entities that have a direct interest in a specific

project.89

34.

A wide range of commenters argue that, in order to prevent needless

condemnations while routes are still subject to change and it is uncertain if a project will

be authorized, the Commission could defer issuing a certificate or condition a certificate

holder’s exercise of eminent domain until an applicant obtains all final federal and state

permits and issuance of such permits is sustained if appeal is filed.90 In contrast, many

regulated companies and industry trade organizations assert that the Commission has no

authority under the NGA to condition a certificate holder’s exercise of eminent domain

because eminent domain is a right that arises directly from the NGA.91 These

commenters express concern that if the Commission defers issuing a certificate until an

applicant has all authorizations needed to commence construction, it would create

practical challenges and could result in unintended consequences (e.g., a pipeline may

need survey access in order to obtain information necessary for another permit).92

89 See Adelphia Gateway LLC 2018 Comments at 13-14

commenters express concern that if the Commission defers issuing a certificate until an

applicant has all authorizations needed to commence construction, it would create

practical challenges and could result in unintended consequences (e.g., a pipeline may

need survey access in order to obtain information necessary for another permit).92

89 See Adelphia Gateway LLC 2018 Comments at 13-14.

90 See, e.g., Land Trust Alliance 2021 Comments at 9; Jackie Freedman 2021

Comments at 1; Pipeline Safety Trust 2021 Comments at 2; Terese and Joseph Buchanan

May 18, 2021 Comments at 1; Gary Salata 2021 Comments at 1.

91 See, e.g., INGAA 2021 Comments at 36-38; API 2021 Comments at 15-16;

Enbridge 2021 Comments at 70; Cheniere 2021 Comments at 9.

92 See, e.g., API 2021 Comments at 17-18; Boardwalk 2021 Comments at 63-65.

Docket No. PL18-1-000

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The Commission’s Consideration of Environmental Impacts

35.

Many commenters suggest that the Commission revise its approach to analyzing

alternatives under NEPA. Some commenters recommend that the Commission consider a

broader scope of alternatives (e.g., modifications to existing infrastructure, co-location

with existing infrastructure, and alternative sources of energy generation)93 or a broader

range of factors to compare alternatives (e.g., the quantified and monetized impact of

GHG emissions; impact of natural gas exports on domestic energy prices; and cost-

effectiveness when accounting for all significant health, productivity, and opportunity

costs).94 Additionally, commenters assert that the Commission should not blindly adopt a

project sponsor’s project purpose and, consistent with Citizens Against Burlington, Inc. v

(e.g., the quantified and monetized impact of

GHG emissions; impact of natural gas exports on domestic energy prices; and cost-

effectiveness when accounting for all significant health, productivity, and opportunity

costs).94 Additionally, commenters assert that the Commission should not blindly adopt a

project sponsor’s project purpose and, consistent with Citizens Against Burlington, Inc. v.

Busey,95 must evaluate alternatives to achieve the Commission’s goals, shaped by the

application before it and the Commission’s function in the decisional process.96 In

contrast, regulated companies and industry trade organizations state that the current scope

of the Commission’s alternatives analysis is appropriate and consistent with NEPA, and

93 See Friends of the Central Shenandoah 2018 Comments at 75; EPA

June 21, 2018 Comments at 1; Leslie Sauer 2018 Comments at 2.

94 See New Jersey Conservation Foundation et al. 2021 Comments at 21-22;

Institute for Policy Integrity at New York University School of Law (Policy Integrity)

2018 Comments at 16, 23-24; Pennsylvania Departments of Environmental Protection,

Conservation and Natural Resources, and Community and Economic Development 2018

Comments at 6; Carolyn Sellars 2018 Comments at 6.

95 938 F.2d 190, 199 (D.C. Cir. 1991).

96 See, e.g., PIO 2021 Comments at 21-22.

Docket No. PL18-1-000

- 26 -

has been upheld by the courts.97 These entities also assert that Busey prohibits the

Commission from considering alternatives that would not meet the purpose and need of

the proposed federal action.98

36.

Many commenters request that the Commission change how it conducts its

cumulative effects analysis under NEPA. For example, NGOs and other commenters

recommend that the Commission conduct regional evaluations99 and prepare

programmatic environmental impact statement (EIS)100 to address cumulative effects

rnatives that would not meet the purpose and need of

the proposed federal action.98

36.

Many commenters request that the Commission change how it conducts its

cumulative effects analysis under NEPA. For example, NGOs and other commenters

recommend that the Commission conduct regional evaluations99 and prepare

programmatic environmental impact statement (EIS)100 to address cumulative effects. To

determine the geographic scope for regional evaluations, commenters recommend that

the Commission use a radius around the proposed project (e.g., 100 miles)101 or consider

the project scale, gas source, and end-use location.102 In contrast, industry trade

organizations and regulated companies recommend that the Commission continue to use

a project-specific geographic scope for its cumulative effects analysis.103 These entities

97 E.g., INGAA 2021 Comments at 39-41.

98 INGAA 2021 Comments at 41; Iroquois 2021 Comments at 13-14; API 2021

Comments at 19-20; Competitive Enterprise Institute 2021 Comments at 2-3; see also

Kinder Morgan 2021 Comments at 26-28.

99 See, e.g., Joint NGOs April 2018 Comments at 2.

100 E.g., Nature Conservancy 2018 Comments at 2-3; Appalachian Trail

Conservancy 2018 Comments at 3.

101 Kirk Frost May 26, 2021 Comments at 8.

102 Delaware Riverkeeper Network & Berks Gas Truth 2021 Comments at 57.

103 See, e.g., INGAA 2018 Comments at 75; Duke Energy Corporation 2018

Comments at 51-53; Edison Electric Institute 2018 Comments at 16.

Joint NGOs April 2018 Comments at 2.

100 E.g., Nature Conservancy 2018 Comments at 2-3; Appalachian Trail

Conservancy 2018 Comments at 3.

101 Kirk Frost May 26, 2021 Comments at 8.

102 Delaware Riverkeeper Network & Berks Gas Truth 2021 Comments at 57.

103 See, e.g., INGAA 2018 Comments at 75; Duke Energy Corporation 2018

Comments at 51-53; Edison Electric Institute 2018 Comments at 16.

Docket No. PL18-1-000

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assert that the Commission does not have the authority under section 7 of the NGA to

conduct regional evaluations, as the Commission only reviews individual pipeline

applications, not broader federal programs or regional actions where a programmatic

review might be appropriate.104

37.

NGOs and individual commenters state that how the Commission balances

environmental impacts against favorable economic impacts is unclear, lacks

transparency, and requires updating.105 Several commenters request that the Commission

give environmental impacts greater weight.106 Other commenters criticize the

Commission’s phased approach to addressing project impacts under the 1999 Policy

Statement, and recommend that the Commission balance economic and environmental

impacts together.107 In contrast, industry trade organizations state that the Commission’s

approach under the 1999 Policy Statement properly balances economic and

environmental impacts, giving proportionate consideration to all impacted

stakeholders.108 These entities contend that broadening the balancing would exceed the

104 E.g., Williams 2021 Comments at 34; INGAA 2021 Comments at 44-45;

Boardwalk 2021 Comments at 73.

105 See, e.g., Delaware Riverkeeper Network 2018 Comments at 92-93; Friends of

the Central Shenandoah 2018 Comments at 92-94; Deb Evans and Rob Schaaf 2018

Comments at 12.

106 E.g., PIO 2021 Comments at 56; Elaine Mroz 2018 Comments at 4.

107 See, e.g., New Jersey Conservation Foundation et al. 2021 Comments at 18-22;

Policy Integrity 2021 Comments at 4; Chesapeake Bay Foundation 2018 Comments at 4

, e.g., Delaware Riverkeeper Network 2018 Comments at 92-93; Friends of

the Central Shenandoah 2018 Comments at 92-94; Deb Evans and Rob Schaaf 2018

Comments at 12.

106 E.g., PIO 2021 Comments at 56; Elaine Mroz 2018 Comments at 4.

107 See, e.g., New Jersey Conservation Foundation et al. 2021 Comments at 18-22;

Policy Integrity 2021 Comments at 4; Chesapeake Bay Foundation 2018 Comments at 4.

108 E.g., API 2021 Comments at 23.

Docket No. PL18-1-000

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Commission’s discretion under the NGA109 and that the NEPA requirement to take a

“hard look” at environmental consequences should remain separate from consideration of

economic impacts.110

38.

Regulated companies and industry trade organizations support the adoption of

other agencies’ categorical exclusions under NEPA, including those referenced in

Commission staff’s presentation at the January 19, 2021 Commission meeting (Docket

No. RM21-10-000).111 Additionally, these entities state that a categorial exclusion

should apply to certain actions that do not currently qualify for the Commission’s blanket

certificate authority (e.g., project amendments that would result in no, or minimal,

changes to the environment).112 In contrast, NGOs suggest that there is no need for the

Commission to expand its existing categorical exclusions, and they request that the

Commission provide a public notice and comment period for all projects in which an

applicant proposes to use a categorical exclusion.113

The Efficiency and Effectiveness of the Commission’s Review Process

39.

Many commenters recommend changes to the Commission’s application review

process. For example, some commenters recommend that all affected stakeholders be

109 Williams 2021 Comments at 39.

110 INGAA 2018 Comments at 85-89.

111 INGAA 2021 Comments at 83-85; Enbridge 2021 Comments at 149-150.

112 E.g., INGAA 2021 Comments at 84; Enbridge 2021 Comments at 150.

113 PIO 2021 Comments at 72-76.

ny commenters recommend changes to the Commission’s application review

process. For example, some commenters recommend that all affected stakeholders be

109 Williams 2021 Comments at 39.

110 INGAA 2018 Comments at 85-89.

111 INGAA 2021 Comments at 83-85; Enbridge 2021 Comments at 149-150.

112 E.g., INGAA 2021 Comments at 84; Enbridge 2021 Comments at 150.

113 PIO 2021 Comments at 72-76.

Docket No. PL18-1-000

- 29 -

brought into the process as early as possible,114 that decisions regarding information

requirements be summarized in a comprehensive application completeness checklist, and

that the Commission’s regulations be amended to encourage applicants to submit

complete applications at the outset.115 Additionally, several commenters recommend

changes to the Commission’s environmental review process, including that the

Commission not prepare a NEPA document absent substantive environmental data for the

entirety of the proposed route,116 that the Commission consider issuing final EISs and

certificates at the same time,117 or, alternatively, that the Commission issue certificates

within 90 days of issuance of a final NEPA document.118 Some commenters also state

that the Commission should not inject additional regulatory uncertainty into its review

process by requiring open-ended or unduly expansive environmental reviews.119

40.

Commenters also make a variety of recommendations to increase transparency in

the Commission’s review process and schedules. For example, some commenters

propose that the Commission issue a public notice when a draft order has been circulated

114 PIO 2021 Comments at 78; see also Dr. Susan F. Tierney 2021 Comments

at 41-42.

115 New Jersey Conservation Foundation et al. 2021 Comments at 30-31.

116 New Jersey Conservation Foundation et al. 2021 Comments at 31.

117 Energy Infrastructure Council (EIC) 2021 Comments at 33; Spectra 2018

Comments at 95.

118 WBI Energy 2021 Comments at 11; INGAA 2018 Comments at 94

circulated

114 PIO 2021 Comments at 78; see also Dr. Susan F. Tierney 2021 Comments

at 41-42.

115 New Jersey Conservation Foundation et al. 2021 Comments at 30-31.

116 New Jersey Conservation Foundation et al. 2021 Comments at 31.

117 Energy Infrastructure Council (EIC) 2021 Comments at 33; Spectra 2018

Comments at 95.

118 WBI Energy 2021 Comments at 11; INGAA 2018 Comments at 94.

119 See, e.g., GPA Midstream Association 2021 Comments at 1; Laborers’

International Union of North America 2021 Comments at 2.

Docket No. PL18-1-000

- 30 -

by Commission staff to the Commissioners,120 establish “permitting timetables” for NGA

section 7(c) projects,121 and clarify deadlines for parties to intervene or submit studies.122

Some commenters also recommend that there be a “cooling off” period after the issuance

of a draft EIS to resolve disputes between an applicant and stakeholders with assistance

from the Commission’s Dispute Resolution Service.123

41.

Several commenters recommend changes to the duration of the pre-filing process.

Recommendations include shortening the pre-filing process and extending the application

review process,124 collapsing pre-filing into the post-filing process to eliminate lengthy

processing times,125 and condensing the application review process by consolidating as

much activity as possible in the pre-filing process and requiring all interested parties

planning to object to a project to do so during pre-filing.126

42.

Many commenters also propose ways to make stakeholder participation more

effective. For example, some commenters propose that applicants provide transportation

120 Kinder Morgan 2021 Comments at 46.

121 WBI Energy 2021 Comments at 11.

122 Carolyn Elefant 2021 Comments at 7; Spectra 2018 Comments at 94-95;

INGAA 2018 Comments at 96.

123 Tom Russo 2021 Comments at 23.

124 Carolyn Elefant 2021 Comments at 6.

125 American Forest & Paper Association et al. 2021 Comments at 26-27; Spectra

2018 Comments at 98-99

licants provide transportation

120 Kinder Morgan 2021 Comments at 46.

121 WBI Energy 2021 Comments at 11.

122 Carolyn Elefant 2021 Comments at 7; Spectra 2018 Comments at 94-95;

INGAA 2018 Comments at 96.

123 Tom Russo 2021 Comments at 23.

124 Carolyn Elefant 2021 Comments at 6.

125 American Forest & Paper Association et al. 2021 Comments at 26-27; Spectra

2018 Comments at 98-99.

126 United Association 2021 Comments at 35-36; INGAA 2018 Comments at 102.

Docket No. PL18-1-000

- 31 -

or access to public transportation to public meetings, adequate parking at venues, and

options for remote participation.127 Several commenters also recommend that the

Commission provide notices and related materials in multiple languages128 and issue

guidance to ensure that pipeline project developers provide sufficient and timely

information.129 Additionally, some commenters recommend that the Commission’s new

OPP be a neutral resource to landowners and other stakeholders seeking more

information on the Commission’s review process.130 Other commenters recommend that

staff prioritize input provided by stakeholders that will be directly impacted by a

project,131 and that all comments submitted to a docket receive a response or some other

indication that a member of Commission staff has read the comments.132

43.

Several commenters note the importance of transparency and coordination in the

interagency review process. Some regulated companies recommend that the Commission

strengthen its role as the lead agency under NEPA by focusing on educating and training

127 E.g., PLAN 2021 Comments at 3; Edward Woll 2021 Comments at 4; Rev.

Betsy Sowers 2021 Comments at 3; Kim Robinson 2021 Comments at 2; Surfrider

Foundation 2018 Comments at 2; Delaware Riverkeeper Network 2018 Comments at 57.

128 Egan Millard 2021 Comments at 3; Robert Kearns 2021 Comments at 3; Inbal

Goldstein 2021 Comments at 4.

129 Dr. Susan F. Tierney 2021 Comments at 42.

130 WBI Energy 2021 Comments at 10

at 3; Edward Woll 2021 Comments at 4; Rev.

Betsy Sowers 2021 Comments at 3; Kim Robinson 2021 Comments at 2; Surfrider

Foundation 2018 Comments at 2; Delaware Riverkeeper Network 2018 Comments at 57.

128 Egan Millard 2021 Comments at 3; Robert Kearns 2021 Comments at 3; Inbal

Goldstein 2021 Comments at 4.

129 Dr. Susan F. Tierney 2021 Comments at 42.

130 WBI Energy 2021 Comments at 10.

131 Kinder Morgan 2021 Comments at 47-48.

132 See, e.g., Kim Robinson 2021 Comments at 2; Leslie Sauer Jones and

Stephanie Jones June 2021 Comments at 1; James and Kathy Chandler 2018 Comments

at 1.

Docket No. PL18-1-000

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cooperating agencies to be better prepared to meet their own statutory deadlines.133

Other commenters suggest that the Commission consider standardized schedules for its

review processes, such as publishing timelines that include pre-filing, preparation of the

NEPA document, and issuance of final orders and authorizations by other agencies,134

and that the Commission create a dedicated task force for coordinating with other

agencies.135

44.

Many commenters support the separate treatment of different classes of projects,

recommending that the Commission provide more timely review of projects with

minimal impacts and certain qualifying benefits,136 or expedite approvals for projects

where only an environmental assessment is required and there is no opposition.137

However, other commenters oppose the separate treatment of different classes of

projects, expressing concern that separate treatment would be arbitrary or

discriminatory138 and that some projects would be left in limbo while the Commission

takes action on what it perceives as priority projects.139 Some commenters also suggest

133 E.g., Kinder Morgan 2021 Comments at 42-43.

134 Enbridge 2021 Comments at 157.

135 Kirk Frost May 26, 2021 Comments at 13.

136 Iroquois 2021 Comments at 18-19.

137 Kinder Morgan 2021 Comments at 44.

138 Americans for Prosperity 2021 Comments at 2

uld be left in limbo while the Commission

takes action on what it perceives as priority projects.139 Some commenters also suggest

133 E.g., Kinder Morgan 2021 Comments at 42-43.

134 Enbridge 2021 Comments at 157.

135 Kirk Frost May 26, 2021 Comments at 13.

136 Iroquois 2021 Comments at 18-19.

137 Kinder Morgan 2021 Comments at 44.

138 Americans for Prosperity 2021 Comments at 2.

139 AGA 2021 Comments at 39.

Docket No. PL18-1-000

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changes to the Commission’s blanket certificate program, including changing the filing

requirements to reduce the number of required resource reports, eliminating the need for

weekly reports,140 increasing both the automatic and prior notice cost limits,141 and

adding consideration of other factors such as a project’s acreage to determine eligibility

for blanket certificate authority.142

The Commission’s Consideration of Effects on Environmental Justice

Communities

45.

Many commenters suggest that the Commission revise its approach for identifying

environmental justice communities in certificate proceedings. For example, some

commenters recommend that the Commission use census block-level data;143 on-the-

ground surveys;144 social, environmental, and health indicators;145 and other data and

tools to identify such communities.146 Additionally, several commenters recommend that

140 EIC 2021 Comments at 34; TransCanada Corporation 2018 Comments at 32.

141 API 2021 Comments at 36.

142 WEC Energy Group, Inc. 2018 Comment at 6-7.

143 See, e.g., PIO 2021 Comments at 86-87; New Jersey Conservation Foundation

et al. 2021 Comments at 38-40.

144 See, e.g., Delaware Riverkeeper Network & Berks Gas Truth 2021 Comments

at 69; Tom Russo 2021 Comments at 24-25; William F. Limpert 2021 Comments at 19.

145 New Jersey Conservation Foundation et al. 2021 Comments at 35-38; North

Carolina Department of Environmental Quality 2021 Comments at 2; EDF 2021

Comments at 57

86-87; New Jersey Conservation Foundation

et al. 2021 Comments at 38-40.

144 See, e.g., Delaware Riverkeeper Network & Berks Gas Truth 2021 Comments

at 69; Tom Russo 2021 Comments at 24-25; William F. Limpert 2021 Comments at 19.

145 New Jersey Conservation Foundation et al. 2021 Comments at 35-38; North

Carolina Department of Environmental Quality 2021 Comments at 2; EDF 2021

Comments at 57.

146 Quincy Democratic City Committee 2021 Comments at 1-2; Natural Resources

Defense Council May 2021 Comments at 14-15.

Docket No. PL18-1-000

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the Commission consult with other federal and state agencies for assistance with

identifying environmental justice communities147 or allow communities to identify

themselves as environmental justice communities.148

46.

Many commenters also recommend changes to how the Commission evaluates

project impacts on environmental justice communities. For example, NGOs assert that

the Commission should always use a reference or comparison group when evaluating

disproportionately high and adverse impacts on such communities149 and ensure that such

a group is neither too geographically narrow nor too demographically similar to avoid

masking disproportionate impacts.150 NGOs and individual commenters recommend that

the Commission consider the existing burden from specific environmental and health

indicators when it evaluates cumulative and historic exposures, including the presence of

other infrastructure and existing pollution levels in the project area.151 Additionally,

these commenters recommend changes to how the Commission evaluates the impacts of

147 EPA 2021 Comments at 7; Jeannie Ambrose 2021 Comments at 2.

148 See Save Our Illinois Land (SOIL) 2021 Comments at 1; William F. Limpert

2021 Comments at 19; Delaware Riverkeeper Network & Berks Gas Truth 2021

Comments at 69.

149 New Jersey Conservation Foundation et al. 2021 Comments at 39-40.

150 Policy Integrity 2021 Comments at 49-52.

151 See, e.g., New Jersey Conservation Foundation et al

A 2021 Comments at 7; Jeannie Ambrose 2021 Comments at 2.

148 See Save Our Illinois Land (SOIL) 2021 Comments at 1; William F. Limpert

2021 Comments at 19; Delaware Riverkeeper Network & Berks Gas Truth 2021

Comments at 69.

149 New Jersey Conservation Foundation et al. 2021 Comments at 39-40.

150 Policy Integrity 2021 Comments at 49-52.

151 See, e.g., New Jersey Conservation Foundation et al. 2021 Comments at 36-37;

Ann W. Woll 2021 Comments at 5; SOIL 2021 Comments at 3.

Docket No. PL18-1-000

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direct and indirect air pollution on environmental justice communities.152 In contrast,

regulated companies and industry trade organizations state that the Commission should

not make substantive changes to how it evaluates impacts on environmental justice

communities at this time, and recommend that the Commission wait for further guidance

from the White House, EPA, and the Council on Environmental Quality (CEQ) to ensure

consistency across the federal government.153

47.

Many commenters state that there are barriers to the participation of environmental

justice communities in Commission proceedings, including inadequate translation services

and the Commission’s reliance on electronic media.154 Other commenters state that

Commission proceedings can be highly technical in nature, rendering them inaccessible to

the general public unless a participant can invest significant time and resources.155 A wide

range of commenters recommend changes to the Commission’s public notice and outreach

processes to ensure meaningful engagement with environmental justice communities,156

152 Delaware Riverkeeper Network & Berks Gas Truth 2021 Comments at 77-82;

EDF 2021 Comments at 58.

153 API 2021 Comments at 37-39; Enbridge 2021 Comments at 167-168.

154 Terese and Joseph Buchanan May 18, 2021 Comments at 1; PIO 2021

Comments at 87-89; Robert Kearns 2021 Comments at 4; Jackie Freedman 2021

Comments at 1; Deborah Brown 2021 Comments at 1.

155 New Jersey Conservation Foundation et al

are Riverkeeper Network & Berks Gas Truth 2021 Comments at 77-82;

EDF 2021 Comments at 58.

153 API 2021 Comments at 37-39; Enbridge 2021 Comments at 167-168.

154 Terese and Joseph Buchanan May 18, 2021 Comments at 1; PIO 2021

Comments at 87-89; Robert Kearns 2021 Comments at 4; Jackie Freedman 2021

Comments at 1; Deborah Brown 2021 Comments at 1.

155 New Jersey Conservation Foundation et al. 2021 Comments at 34.

156 See, e.g., Kinder Morgan 2021 Comments at 58-59; Ohio Environmental

Council 2021 Comments at 3.

Docket No. PL18-1-000

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including the Commission’s process for consulting with Tribes.157 Many commenters also

support the Commission’s formation of OPP158 and recommend that the Commission

coordinate with community-based organizations and institutions to further encourage the

participation of environmental justice communities in Commission proceedings.159

48.

Several commenters assert that section 7(e) of the NGA provides the Commission

with broad conditioning authority to address project impacts on environmental justice

communities in its certificates.160 Some commenters state that the Commission should

use its NEPA alternatives analysis to identify and evaluate ways to mitigate impacts on

environmental justice communities.161 If mitigating adverse impacts on environmental

justice communities is not possible, other commenters assert that the Commission should

deny a certificate.162

157 Coharie Intra-Tribal Council, Haliwa-Saponi Indian Tribe, Lumbee Tribe of

North Carolina, Meherrin Indian Nation of North Carolina, Nottoway Indian Tribe of

Virginia, and Occaneechi Band of Saponi Nation 2021 Comments at 2; Haliwa-Saponi

Indian Tribe 2021 Comments at 2; Delaware Riverkeeper Network & Berks Gas Truth

2021 Comments at 71.

158 See, e.g., API 2021 Comments at 41; EPA 2021 Comments at 8; National Fuel

2021 Comments at 22.

159 New Jersey Conservation Foundation et al. 2021 Comments at 33-35; Delaware

Riverkeeper Network & Berks Gas Truth 2021 Comments at 73-74

nd of Saponi Nation 2021 Comments at 2; Haliwa-Saponi

Indian Tribe 2021 Comments at 2; Delaware Riverkeeper Network & Berks Gas Truth

2021 Comments at 71.

158 See, e.g., API 2021 Comments at 41; EPA 2021 Comments at 8; National Fuel

2021 Comments at 22.

159 New Jersey Conservation Foundation et al. 2021 Comments at 33-35; Delaware

Riverkeeper Network & Berks Gas Truth 2021 Comments at 73-74.

160 New Jersey Division of Rate Counsel 2021 Comments at 23; PIO 2021

Comments at 105.

161 INGAA 2021 Comments at 98-99; EPA 2021 Comments at 8-9.

162 See, e.g., Attorneys General of Massachusetts, Connecticut, Maryland,

Minnesota, New Jersey, New York, Oregon, Rhode Island, and the District of Columbia

Docket No. PL18-1-000

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49.

In contrast, many regulated companies and industry trade organizations state that

no federal statute requires the Commission to implement specific remedial measures to

address project impacts on environmental justice communities, but they assert that NEPA

provides an appropriate framework in which to analyze such impacts.163 These entities

also contend that that the Commission’s conditioning authority under section 7(e) of the

NGA is limited to direct project impacts and the Commission could not require measures

to redress prior industrial impacts on environmental justice communities or impacts

outside of the Commission’s jurisdiction.164

III.

Goals and Objectives of the Updated Certificate Policy Statement

These entities

also contend that that the Commission’s conditioning authority under section 7(e) of the

NGA is limited to direct project impacts and the Commission could not require measures

to redress prior industrial impacts on environmental justice communities or impacts

outside of the Commission’s jurisdiction.164

III.

Goals and Objectives of the Updated Certificate Policy Statement

50.

While significant changes have occurred in the past 23 years, the Commission’s

goals and objectives with this Updated Policy Statement remain consistent with those of

the 1999 Policy Statement, including to: (1) “appropriately consider the enhancement of

competitive transportation alternatives, the possibility of over building, the avoidance of

unnecessary disruption of the environment, and the unneeded exercise of eminent

2021 Comments at 32-33 (Attorneys General of Massachusetts et al.); see also PLAN

2021 Comments at 5; Katherine Manuel 2021 Comments at 5; Elizabeth Moulds 2021

Comments at 4; Jessica Greenwood 2021 Comments at 4; Shayna Gleason 2021

Comments at 3; Rick Mattila 2021 Comments at 3.

163 See, e.g., Williams 2021 Comments at 60-62, 65; Enbridge 2021 Comments

at 178-180, 186; Kinder Morgan 2021 Comments at 48, 57; INGAA 2021 Comments

at 88-90.

164 See, e.g., Enbridge 2021 Comments at 181; API 2021 Comment at 44-45.

Docket No. PL18-1-000

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domain;”165 (2) “provide appropriate incentives for the optimal level of construction and

efficient customer choices;”166 and (3) “provide an incentive for applicants to structure

their projects to avoid, or minimize, the potential adverse impacts that could result from

construction of the project.”167

51.

As discussed above, the 1999 Policy Statement included an analytical framework

for how the Commission would evaluate the effects of certificating new projects on

economic interests. With this Updated Policy Statement, the Commission intends to

provide a more comprehensive analytical framework for its decision-making process

impacts that could result from

construction of the project.”167

51.

As discussed above, the 1999 Policy Statement included an analytical framework

for how the Commission would evaluate the effects of certificating new projects on

economic interests. With this Updated Policy Statement, the Commission intends to

provide a more comprehensive analytical framework for its decision-making process.

Specifically, we provide clarity on how the Commission will evaluate all factors bearing

on the public interest, including the balancing of economic and environmental interests in

determining whether a project is required by the public convenience and necessity, thus

providing more regulatory certainty in the Commission’s review process and public

interest determinations.

165 1999 Policy Statement, 88 FERC at 61,737.

166 Id. at 61,743.

167 Id.

Docket No. PL18-1-000

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IV.

Updated Certificate Policy Statement

Factors to be Balanced in Assessing the Public Convenience and

Necessity

52.

In determining whether to issue a certificate of public convenience and necessity,

the Commission will weigh the public benefits of a proposal, the most important of which

is the need that will be served by the project, against its adverse impacts.

Consideration of Project Need

53.

To demonstrate that a project is required by the public convenience and necessity,

an applicant must first establish that the proposed project is needed. As indicated above,

the Commission’s expectations and requirements for how applicants should demonstrate

project need have evolved over time. In the 1999 Policy Statement, the Commission

noted concerns associated with relying “primar[ily]”168 or “almost exclusively”169 on

contracts to establish need for a new project

ty,

an applicant must first establish that the proposed project is needed. As indicated above,

the Commission’s expectations and requirements for how applicants should demonstrate

project need have evolved over time. In the 1999 Policy Statement, the Commission

noted concerns associated with relying “primar[ily]”168 or “almost exclusively”169 on

contracts to establish need for a new project. Those concerns included the “additional

issues [that arise] when the contracts are held by pipeline affiliates”170 and the difficulty

such a policy creates for “articulat[ing] to landowners and community interests why their

land must be used for a new pipeline project.”171 Thus, the 1999 Policy Statement

provided that:

[r]ather than relying only on one test for need, the Commission will

consider all relevant factors reflecting on the need for the project. These

168 Id. at 61,744.

169 Id.

170 Id.

171 Id.

Docket No. PL18-1-000

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might include, but would not be limited to, precedent agreements, demand

projections, potential cost savings to consumers, or a comparison of

projected demand with the amount of capacity currently serving the

market.172

54.

However, in practice, the Commission has relied almost exclusively on precedent

agreements to establish project need. Although courts have upheld the Commission’s

practice in certain contexts,173 we find that we cannot adequately assess project need

without also looking at evidence beyond precedent agreements. After all, as the

Commission’s 1999 Policy Statement noted, many different factors may indicate the

need—or lack thereof—for a new interstate pipeline. While precedent agreements may

indicate one or more shipper’s willingness to contract for new capacity, such willingness

may not in all circumstances be sufficient to sustain a finding of need—e.g., in the face of

contrary evidence or where there is reason to discount the probative value of those

precedent agreements

actors may indicate the

need—or lack thereof—for a new interstate pipeline. While precedent agreements may

indicate one or more shipper’s willingness to contract for new capacity, such willingness

may not in all circumstances be sufficient to sustain a finding of need—e.g., in the face of

contrary evidence or where there is reason to discount the probative value of those

precedent agreements. Accordingly, we find that looking only to precedent agreements,

and ignoring other, potentially contrary, evidence may cause the Commission to reach a

determination on need that is inconsistent with the weight of the evidence in any

172 Id. at 61,747 (emphasis added).

173 See, e.g., Minisink Residents for Envtl. Pres. & Safety v. FERC, 762 F.3d 97,

110 n.10 (D.C. Cir. 2014) (noting that the 1999 Policy Statement “permits” but does not

“require[]” the Commission to “ look[] beyond the market need reflected by the

applicant’s existing contracts with shippers”). But see Environmental Defense Fund v.

FERC, 2 F.4th 953, 973 (D.C. Cir. 2021) (finding that is was arbitrary and capricious for

the Commission to rely solely on a single precedent agreement with an affiliate shipper to

establish need when demand for natural gas in the area was flat and the Commission

neglected to make a finding as to whether the proposed pipeline would result in a more

economical alternative to existing pipelines).

Docket No. PL18-1-000

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particular proceeding, in violation of both the NGA and the Commission’s

responsibilities under the Administrative Procedure Act.174 We reaffirm the

Commission’s commitment to consider all relevant factors bearing on the need for a

project. Although precedent agreements remain important evidence of need, and we

expect that applicants will continue to provide precedent agreements, the existence of

precedent agreements may not be sufficient in and of themselves to establish need for the

project

nistrative Procedure Act.174 We reaffirm the

Commission’s commitment to consider all relevant factors bearing on the need for a

project. Although precedent agreements remain important evidence of need, and we

expect that applicants will continue to provide precedent agreements, the existence of

precedent agreements may not be sufficient in and of themselves to establish need for the

project. The Commission will also consider, as relevant, the circumstances surrounding

the precedent agreements (e.g., whether the agreements were entered into before or after

an open season and the results of the open season, including the number of bidders,

whether the agreements were entered into in response to LDC or generator requests for

proposals (RFP) and, if so, the details around that RFP process, including the length of

time from RFP to execution of the agreement), as well as other evidence of need, as

discussed below.

55.

For all categories of proposed projects, we encourage applicants to provide

specific information detailing how the gas to be transported by the proposed project will

ultimately be used, why the project is needed to serve that use, and the expected

utilization rate of the proposed project. To the extent applicants do not have information

on the end use of the gas, they are encouraged to work with their prospective shippers to

174 Under the Administrative Procedure Act, an agency cannot ignore substantial

evidence bearing on the agency decision. See 5 U.S.C. 706; see also, e.g., Motor

Vehicles Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43

ject. To the extent applicants do not have information

on the end use of the gas, they are encouraged to work with their prospective shippers to

174 Under the Administrative Procedure Act, an agency cannot ignore substantial

evidence bearing on the agency decision. See 5 U.S.C. 706; see also, e.g., Motor

Vehicles Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43

(1983) (holding that an agency decision is arbitrary and capricious if it “entirely fail[s] to

consider an important aspect of the problem”).

Docket No. PL18-1-000

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obtain it. The absence of this information may prevent an applicant from meeting its

burden to demonstrate that a project is needed.

56.

For a market-driven project that is responding to increased natural gas demand, the

evidence relating to the need for the project could include a market study that projects

volumetric or peak day load growth. An applicant may rely on publicly available

analyses by the Energy Information Administration or other third parties showing

projections of market growth. The applicant could also provide its best assessment,

based on publicly available information or data, of whether other transportation suppliers

may be able to meet the incremental demand with existing capacity to demonstrate why

new pipeline construction is necessary. For individual shippers, load growth profiles, gas

supply portfolios, and any advanced approval of contracts by state public service

commissions would also be helpful in showing evidence of project need.

57.

Some projects may not directly serve a customer but rather are being undertaken

to add supplies of natural gas to the market. Such projects may be driven by natural gas

producers or natural gas utilities attempting to provide supply at lower cost or support

reliability by increasing the volumes of natural gas available to customers

d also be helpful in showing evidence of project need.

57.

Some projects may not directly serve a customer but rather are being undertaken

to add supplies of natural gas to the market. Such projects may be driven by natural gas

producers or natural gas utilities attempting to provide supply at lower cost or support

reliability by increasing the volumes of natural gas available to customers. For these

projects, evidence to demonstrate consumer benefits may include projections of the net

benefits, for example projected lower natural gas prices for consumers due to increased

supply competition, compared to the incremental costs of transportation on the new

pipeline. The Commission will consider record evidence of regional projections for both

gas supply and market growth, as well as pipeline-specific studies in these areas.

Docket No. PL18-1-000

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58.

Other pipeline projects may be intended to support more efficient system

operations by replacing older and inefficient facilities (e.g., compressors and leak-prone

pipes) and performing other infrastructure improvements, or to respond to changing state

and federal government pipeline safety or environmental requirements. For these

projects, applicants may document how proposed facilities, for example pipeline or

compressor replacements, provide expected system benefits, such as reduced operating

costs, improved pipeline integrity, or reduced natural gas leaks. In addition, an applicant

may document how a project avoids adverse impacts or satisfies any changing state or

federal government regulations.

59.

The Commission will consider both current and projected future demand for a

project based on the evidence in the record. Applicants are encouraged to submit

analyses showing how market trends as well as current and expected policy and

regulatory developments would affect future need for the project

avoids adverse impacts or satisfies any changing state or

federal government regulations.

59.

The Commission will consider both current and projected future demand for a

project based on the evidence in the record. Applicants are encouraged to submit

analyses showing how market trends as well as current and expected policy and

regulatory developments would affect future need for the project. Applicants are also

encouraged to provide a thorough assessment of alternatives, including supporting data,

to facilitate the Commission’s review. In assessing the strength of the applicant’s need

showing, the Commission will consider record evidence of alternatives to the proposed

project. The Commission’s evaluation will include information indicating that other

suppliers would be able to meet some or all of the needs to be served by the proposed

project on a timely, competitive basis or whether other factors may eliminate or curtail

such needs.

60.

As the Commission noted in the 1999 Policy Statement, projects supported by

precedent agreements with affiliates raise unique concerns regarding need for the

Docket No. PL18-1-000

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project.175 And, as the United States Court of Appeals for the District of Columbia

Circuit (D.C. Circuit) recently held in Environmental Defense Fund v. FERC, “evidence

of ‘market need’ is too easy to manipulate when there is a corporate affiliation between

the proponent of a new pipeline and a single shipper who have entered into a precedent

agreement.”176 Given those concerns, affiliate precedent agreements will generally be

insufficient to demonstrate need. Instead, where projects are backed primarily by

precedent agreements with affiliates, the Commission will consider additional

information, such as the evidence outlined above.177 We will determine how much

additional evidence is required on a case-by-case determination.

eement.”176 Given those concerns, affiliate precedent agreements will generally be

insufficient to demonstrate need. Instead, where projects are backed primarily by

precedent agreements with affiliates, the Commission will consider additional

information, such as the evidence outlined above.177 We will determine how much

additional evidence is required on a case-by-case determination.

61.

To the extent the Commission receives information in the record from third parties

addressing the need for a project, that too will be considered in our analysis. Where an

applicant fails to carry its burden of demonstrating the proposed project is needed, the

Commission will not undertake any further consideration of the project’s benefits or

adverse effects.

175 1999 Policy Statement, 88 FERC at 61,739-40 (noting that the “use of contracts

with affiliates to demonstrate market support for projects has generated opposition from

affected landowners and competitor pipelines who question whether the contracts

represent real market demand”) and 61,744 (stating that “[u]sing contracts as the primary

indicator of market support for the proposed pipeline project also raises additional issues

when the contracts are held by pipeline affiliates.”).

176 2 F.4th at 973.

177 See supra P 55.

Docket No. PL18-1-000

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Consideration of Adverse Effects

62.

In determining whether to issue a certificate of public convenience and necessity,

the Commission will consider four major interests that may be adversely affected by the

construction and operation of new projects: (1) the interests of the applicant’s existing

customers; (2) the interests of existing pipelines and their captive customers;

- 45 -

Consideration of Adverse Effects

62.

In determining whether to issue a certificate of public convenience and necessity,

the Commission will consider four major interests that may be adversely affected by the

construction and operation of new projects: (1) the interests of the applicant’s existing

customers; (2) the interests of existing pipelines and their captive customers;

(3) environmental interests; and (4) the interests of landowners and surrounding

communities, including environmental justice communities. The Commission may deny

an application based on any of these types of adverse impacts.

Impacts on Existing Customers of the Pipeline Applicant

63.

Existing customers of the pipeline applicant may be adversely affected if a

proposed project causes an increase in rates or a degradation in service. Regarding

potential rate increases, although we are no longer characterizing this issue as a

“threshold question” in this Updated Policy Statement, our policy of no financial

subsidies remains unchanged.178 That is, the pipeline applicant must be prepared to

financially support its proposed project without relying on subsidization by its existing

customers. As to other potential impacts to existing customers, like a degradation in

service, we will consider the applicant’s efforts to eliminate or minimize any such

impacts.

178 1999 Policy Statement, 88 FERC at 61,746-47, clarified, 90 FERC at 61,391-

96.

pipeline applicant must be prepared to

financially support its proposed project without relying on subsidization by its existing

customers. As to other potential impacts to existing customers, like a degradation in

service, we will consider the applicant’s efforts to eliminate or minimize any such

impacts.

178 1999 Policy Statement, 88 FERC at 61,746-47, clarified, 90 FERC at 61,391-

96.

Docket No. PL18-1-000

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64.

As the Commission stated in the 1999 Policy Statement, the policy of no financial

subsidies does not mean that a project sponsor has to bear all the financial risk of the

project; the risk can be shared with new customers, but it generally cannot be shifted to

existing customers.179 One of the Commission’s regulatory goals is to protect captive

customers from rate increases during the terms of their contracts that are unrelated to the

costs associated with their service. And existing customers of the expanding pipeline

should not have to subsidize a project that does not serve them.

65.

The 1999 Policy Statement also stated that the requirement that a new project must

be financially viable without subsidies does not eliminate the possibility that, in some

instances, project costs should be rolled into the rates of existing customers.180 In most

instances, incremental pricing will avoid subsidies for the new project, but the situation

may be different in cases of inexpensive expansibility that is made possible because of

earlier, costly construction.181 In that instance, because the existing customers bear the

cost of the earlier, more costly construction in their rates, incremental pricing could result

in the new customers receiving a subsidy from the existing customers because the new

customers would not face the full cost of the construction that makes their new service

possible.

179 1999 Policy Statement, 88 FERC at 61,746. For new pipeline companies,

without existing customers, this requirement has no application.

180 Id.

181 Id.

in their rates, incremental pricing could result

in the new customers receiving a subsidy from the existing customers because the new

customers would not face the full cost of the construction that makes their new service

possible.

179 1999 Policy Statement, 88 FERC at 61,746. For new pipeline companies,

without existing customers, this requirement has no application.

180 Id.

181 Id.

Docket No. PL18-1-000

- 47 -

66.

Additionally, expansion costs could still be included in existing shippers’ rates

when proposed projects are designed to improve service for existing customers.182

Increasing the rates of existing customers to pay for projects designed to benefit those

customers (i.e., by replacing existing capacity, improving reliability, or providing

flexibility) is not a subsidy.183

Impacts on Existing Pipelines and Their Customers

67.

As the Commission stated in the 1999 Policy Statement, existing pipelines that

already serve the market to be served by the proposed new capacity may be affected by

the potential loss of market share and the possibility that they may be left with

unsubscribed capacity investment.184 Additionally, captive customers of existing

pipelines may be affected if they must pay for the resulting unsubscribed capacity in their

rates. These remain important concerns.

68.

It has been the Commission’s long-standing position that it has an obligation to

ensure fair competition, but that it is not the role of the Commission to protect existing

pipelines from the effects of competition.185 While we continue to maintain this position,

we also emphasize that it is not just unfair competition that can harm captive customers.

182 Order Clarifying Statement of Policy, 90 FERC at 61,391.

183 Id. at 61,393.

184 1999 Policy Statement, 88 FERC at 61,748.

185 See Ruby Pipeline, L.L.C., 128 FERC ¶ 61,224, at PP 37-39 (2009); see also

1999 Policy Statement, 88 FERC at 61,748.

ion.185 While we continue to maintain this position,

we also emphasize that it is not just unfair competition that can harm captive customers.

182 Order Clarifying Statement of Policy, 90 FERC at 61,391.

183 Id. at 61,393.

184 1999 Policy Statement, 88 FERC at 61,748.

185 See Ruby Pipeline, L.L.C., 128 FERC ¶ 61,224, at PP 37-39 (2009); see also

1999 Policy Statement, 88 FERC at 61,748.

Docket No. PL18-1-000

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The Commission must consider the possible harm to captive customers that can result

from a new pipeline, regardless of whether there is evidence of unfair competition.

69.

Congress enacted the NGA “with the principal aim of encouraging the orderly

development of plentiful supplies of . . . natural gas at reasonable prices, and protecting

consumers against exploitation at the hands of natural gas companies.”186 Ensuring the

orderly development of natural gas supplies includes preventing overbuilding. One way

that the Commission can prevent overbuilding is through careful consideration of a

proposed project’s impacts on existing pipelines. To the extent that a proposed project is

designed to substantially serve demand already being met on existing pipelines, that

could be an indication of potential overbuilding. Nevertheless, in such instances, the

Commission will also consider whether the proposed project would offer certain

advantages (e.g., providing lower costs to consumers or enhancing system reliability).

70.

Comments from existing pipelines and their captive customers about the potential

impacts from a proposed project will be an important piece of our review. Additionally,

comments from state utility or public service commissions as to how a proposed project

may impact existing pipelines will be particularly useful.

Environmental Impacts

71.

As noted above, the 1999 Policy Statement included an analytical framework for

how the Commission would evaluate the effects of certificating new projects on

186 City of Clarksville, Tennessee v

view. Additionally,

comments from state utility or public service commissions as to how a proposed project

may impact existing pipelines will be particularly useful.

Environmental Impacts

71.

As noted above, the 1999 Policy Statement included an analytical framework for

how the Commission would evaluate the effects of certificating new projects on

186 City of Clarksville, Tennessee v. FERC, 888 F.3d at 479 (quoting NAACP v.

FPC, 425 U.S. at 669-70 and FPC v. Hope Nat. Gas Co., 320 U.S. at 610).

Docket No. PL18-1-000

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economic interests. However, the 1999 Policy Statement did not describe how the

Commission would consider environmental interests in its decision-making process and,

more specifically, how it would balance these interests with the economic interests of a

project. Instead, it stated that environmental interests would be “separately considered”

in a certificate proceeding after the balancing of public benefits against the residual

adverse effects on economic interests.187

72.

While the 1999 Policy Statement focused on economic impacts, the consideration

of environmental impacts is an important part of the Commission’s responsibility under

the NGA to evaluate all factors bearing on the public interest.188 In the years

immediately following issuance of the 1999 Policy Statement, the Commission would

sometimes issue a preliminary determination on the non-environmental issues associated

with a proposed project, and then issue a subsequent decision on the certificate

application following the environmental review process; however, in practice,

Commission staff would begin review of both the economic and environmental impacts

following the filing of an application. Today, the Commission no longer issues

preliminary determinations on non-environmental issues, and the Commission and staff

187 1999 Policy Statement, 88 FERC at 61,747.

188 See Atl. Ref. Co. v. Pub. Serv. Comm’n of N.Y., 360 U.S

l review process; however, in practice,

Commission staff would begin review of both the economic and environmental impacts

following the filing of an application. Today, the Commission no longer issues

preliminary determinations on non-environmental issues, and the Commission and staff

187 1999 Policy Statement, 88 FERC at 61,747.

188 See Atl. Ref. Co. v. Pub. Serv. Comm’n of N.Y., 360 U.S. at 391 (holding that

the NGA requires the Commission to consider “all factors being on the public interest”);

see also Sabal Trail, 867 F.3d at 1373 (explaining that the Commission must consider a

pipeline’s direct and indirect GHG emissions because the Commission may “deny a

pipeline certificate on the ground that the pipeline would be too harmful to

the environment”).

Docket No. PL18-1-000

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continue to review the economic and environmental impacts of projects concurrently.

Thus, the sequential framing of these analyses in the 1999 Policy Statement has created

some confusion and incorrectly conveyed how the Commission considers environmental

impacts. In addition to questions about sequencing, we have seen a significant increase

in comments from a range of stakeholders expressing concerns about how the

Commission considers environmental impacts, including impacts on climate change and

environmental justice communities, in its public interest determinations.

73.

To provide more clarity and regulatory certainty to all participants in certificate

proceedings, we explain here how the Commission will consider environmental

impacts.189 The Commission will balance all impacts, including economic and

environmental impacts, together in its public interest determinations under the NGA. As

discussed further below, the potential adverse impacts will be weighed against the

evidence of need and other potential benefits of a proposal in determining whether to

issue a certificate of public convenience and necessity.

impacts.189 The Commission will balance all impacts, including economic and

environmental impacts, together in its public interest determinations under the NGA. As

discussed further below, the potential adverse impacts will be weighed against the

evidence of need and other potential benefits of a proposal in determining whether to

issue a certificate of public convenience and necessity.

74.

We will consider environmental impacts and potential mitigation in both our

environmental reviews under NEPA and our public interest determinations under the

NGA. The Commission expects applicants to structure their projects to avoid, or

minimize, potential adverse environmental impacts. Additionally, we expect applicants

to propose measures for mitigating impacts, and we will consider those measures—or the

189 Recognizing that CEQ is in the process of revising its NEPA regulations, the

Commission will consider the comments in this docket regarding NEPA in our future

review of our regulations, procedures, and practices for implementing NEPA.

Docket No. PL18-1-000

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lack thereof—in balancing adverse impacts against the potential benefits of a proposal.

Further, the NGA grants the Commission broad authority to attach reasonable terms and

conditions to certificates of public convenience and necessity.190 Should we deem an

applicant’s proposed mitigation of impacts inadequate to enable us to reach a public

interest determination, we may condition the certificate to require additional mitigation.

We may also deny an application based on any of the types of adverse impacts described

herein, including environmental impacts, if the adverse impacts as a whole outweigh the

benefits of the project and cannot be mitigated or minimized.

tigation of impacts inadequate to enable us to reach a public

interest determination, we may condition the certificate to require additional mitigation.

We may also deny an application based on any of the types of adverse impacts described

herein, including environmental impacts, if the adverse impacts as a whole outweigh the

benefits of the project and cannot be mitigated or minimized.

75.

As noted above, since issuance of the 1999 Policy Statement, the Commission’s

policy for considering climate impacts has evolved.191 In addition to the significant

increase in comments from stakeholders, the courts have issued several decisions

addressing the Commission’s evaluation of GHG emissions in certificate proceedings.

The D.C. Circuit recently held that reasonably foreseeable downstream GHG emissions

are an indirect effect of the Commission authorizing proposed projects192 and are relevant

to the Commission’s determination of whether proposed projects are required by the

public convenience and necessity.193

190 15 U.S.C. 717f(e); see also, e.g., ANR Pipeline Co. v. FERC, 876 F.2d 124, 129

(D.C. Cir. 1989) (noting the Commission’s “extremely broad” conditioning authority).

191 Supra P 15.

192 Sabal Trail, 867 F.3d at 1374.

193 Id. at 1373. In Birckhead v. FERC, 925 F.3d 510, 518 (D.C. Cir. 2019), the

D.C. Circuit rejected the Commission’s position that Sabal Trail is limited to the narrow

190 15 U.S.C. 717f(e); see also, e.g., ANR Pipeline Co. v. FERC, 876 F.2d 124, 129

(D.C. Cir. 1989) (noting the Commission’s “extremely broad” conditioning authority).

191 Supra P 15.

192 Sabal Trail, 867 F.3d at 1374.

193 Id. at 1373. In Birckhead v. FERC, 925 F.3d 510, 518 (D.C. Cir. 2019), the

D.C. Circuit rejected the Commission’s position that Sabal Trail is limited to the narrow

Docket No. PL18-1-000

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76.

Concurrently with this Updated Policy Statement, we are issuing a separate policy

statement to explain how the Commission will assess project impacts on climate change

in certificate proceedings going forward.194 This separate policy statement describes

Commission procedures for evaluating climate impacts under NEPA and explains how

the Commission will integrate climate considerations into its public convenience and

necessity findings under the NGA, including how the Commission will consider

measures to mitigate climate impacts. When making public interest determinations, we

intend to fully consider climate impacts, in addition to other environmental impacts.

Impacts on Landowners and Surrounding Communities

77.

The construction and operation of new natural gas infrastructure has the potential

to result in adverse impacts on the landowners and communities surrounding a project.

As the Commission stated in the 1999 Policy Statement:

[l]andowners whose land would be condemned for the new pipeline right-

of-way, under eminent domain rights conveyed by the Commission’s

certificate, have an interest as does the community surrounding the right-of-

way. The interest of these groups is to avoid unnecessary construction, and

facts of that case. While the court in Birckhead acknowledged that downstream

emissions may not always be a foreseeable effect of natural gas projects, it rejected the

notion that downstream GHG emissions are a reasonably foreseeable indirect effect of a

natural gas project only if a specific end destination is identified

he interest of these groups is to avoid unnecessary construction, and

facts of that case. While the court in Birckhead acknowledged that downstream

emissions may not always be a foreseeable effect of natural gas projects, it rejected the

notion that downstream GHG emissions are a reasonably foreseeable indirect effect of a

natural gas project only if a specific end destination is identified. The court further noted

that the Commission should attempt to obtain information on downstream uses to

determine whether downstream GHG emissions are a reasonably foreseeable effect of the

project. Birckhead, 925 F.3d at 518-19.

194 GHG Policy Statement, 178 FERC ¶ 61,108.

Docket No. PL18-1-000

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any adverse effects on their property associated with a permanent right-of-

way.195

In the over 20 years that have passed since issuance of the 1999 Policy Statement, the

Commission has seen an increase in proposals for projects in more densely populated

areas, as well as a significant increase in comments from landowners raising a multitude

of economic, environmental, and others concerns with proposed projects.

78.

While the 1999 Policy Statement focused primarily on the economic impact

associated with a permanent right-of-way on a landowner’s property,196 going forward,

and as discussed below, our analysis of impacts to landowners will be more expansive.

This fuller consideration of landowner impacts is consistent with the Commission’s

approach in recent years of more fully engaging with landowners to ensure that their

concerns are properly considered in our proceedings. For example, in June 2021, the

Commission established OPP, in part, to facilitate public participation in Commission

proceedings.

79.

In addition to the increase in comments from landowners since issuance of the

1999 Policy Statement, the Commission has also seen a significant increase in comments

raising environmental justice concerns

concerns are properly considered in our proceedings. For example, in June 2021, the

Commission established OPP, in part, to facilitate public participation in Commission

proceedings.

79.

In addition to the increase in comments from landowners since issuance of the

1999 Policy Statement, the Commission has also seen a significant increase in comments

raising environmental justice concerns. In recent years, issues surrounding

environmental justice and equity have received increased focus and attention at both the

195 1999 Policy Statement, 88 FERC at 61,748.

196 Id. at 61,749 (“The balancing of interests and benefits that will precede the

environmental analysis will largely focus on economic interests such as the property

rights of landowners.”).

Docket No. PL18-1-000

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state and federal levels, as demonstrated by the recent issuance of Executive Orders

13985 and 14008, referenced above.197 The Commission is committed to ensuring that

environmental justice and equity concerns are better incorporated into our decision-

making processes. Accordingly, we clarify that our consideration of impacts to

communities surrounding a proposed project will include an assessment of impacts to any

environmental justice communities and of necessary mitigation to avoid or lessen those

impacts.

80.

The Commission and applicants have a shared responsibility to engage

communities that may be impacted by a proposed project. This responsibility includes

ensuring effective communication with landowners and environmental justice

communities about potential impacts and giving careful consideration to the input of such

parties during the agency proceeding. Below, we further discuss our expectations for

how pipeline applicants will engage with landowners, steps the Commission has taken to

protect landowner interests, and how the Commission will consider potential impacts to

landowners and environmental justice communities.

Impacts on Landowners

s and giving careful consideration to the input of such

parties during the agency proceeding. Below, we further discuss our expectations for

how pipeline applicants will engage with landowners, steps the Commission has taken to

protect landowner interests, and how the Commission will consider potential impacts to

landowners and environmental justice communities.

Impacts on Landowners

81.

As noted above, once the Commission grants a certificate of public convenience

and necessity, section 7(h) of the NGA authorizes a certificate holder to acquire the

necessary land or property to construct the approved facilities by exercising the right of

197 Supra P 16.

Docket No. PL18-1-000

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eminent domain for those lands for which it could not negotiate an easement with

landowners.198 As the Commission has previously recognized:

[t]here is no question that eminent domain is among the most significant

actions that a government may take with regard to an individual’s private

property. And the harm to an individual from having their land condemned

is one that may never be fully remedied, even in the event they receive their

constitutionally-required compensation.199

Thus, looking only at the economic impacts associated with eminent domain does not

sufficiently account for the full scope of impact on landowners. Landowners whose

property is subject to eminent domain often experience intangible impacts, which cannot

always be monetized. Our consideration of landowner impacts will be based upon robust

early engagement with all interested landowners, as well as continued evaluation of input

from such parties during the course of any given proceeding. And we will, to the extent

possible, assess a wider range of landowner impacts.

82.

Given the serious impacts associated with the use of eminent domain, we expect

pipeline applicants to take all appropriate steps to minimize the future need to use

eminent domain

h all interested landowners, as well as continued evaluation of input

from such parties during the course of any given proceeding. And we will, to the extent

possible, assess a wider range of landowner impacts.

82.

Given the serious impacts associated with the use of eminent domain, we expect

pipeline applicants to take all appropriate steps to minimize the future need to use

eminent domain. This includes engaging with the public and interested stakeholders

during the planning phase of projects to solicit input on route concerns and incorporate

reroutes, where practicable, to address landowner concerns, as well as providing

landowners with all necessary information. Additionally, we expect pipelines to take

198 15 U.S.C. 717f(h).

199 Limiting Authorizations to Proceed with Construction Activities Pending

Rehearing, Order 871-B, 86 FR 26150 (May 13, 2021), 175 FERC ¶ 61,098, at P 47

(2021).

Docket No. PL18-1-000

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seriously their obligation to attempt to negotiate easements respectfully and in good faith

with impacted landowners. The Commission will look unfavorably on applicants that do

not work proactively with landowners to address concerns.

83.

Additionally, we note that that, while a certificate provides the holder with

significant rights and privileges, it also imposes concomitant responsibilities, including

complying with all certificate conditions. Specifically, certificate holders must comply

with requirements regarding restoration of the pipeline right-of-way. Failure to comply

with such requirements could mean that a pipeline is out of compliance with its

certificate, and could lead to compliance action by the Commission, including referral to

the Commission’s Office of Enforcement for further investigation and potential civil

penalties.200

, certificate holders must comply

with requirements regarding restoration of the pipeline right-of-way. Failure to comply

with such requirements could mean that a pipeline is out of compliance with its

certificate, and could lead to compliance action by the Commission, including referral to

the Commission’s Office of Enforcement for further investigation and potential civil

penalties.200

84.

Although the Commission does not have the authority to deny or restrict the power

of eminent domain in a section 7 certificate,201 or to oversee the acquisition of property

rights through eminent domain, including issues regarding the timing of and just

compensation for the acquisition of property rights,202 the Commission has recently taken

200 See, e.g., Midship Pipeline Co., LLC, 177 FERC ¶ 61,187 (2021).

201 See Midcoast Interstate Transmission, Inc. v. FERC, 198 F.3d 960, 973 (D.C.

Cir. 2000) (“The Commission does not have the discretion to deny a certificate holder the

power of eminent domain.”).

202 PennEast Pipeline Co., LLC, 174 FERC ¶ 61,056, at P 10 (2021) (citing Atl.

Coast Pipeline, LLC, 164 FERC ¶ 61,100, at P 88 (2018); Mountain Valley Pipeline,

LLC, 163 FERC ¶ 61,197, at P 76 (2018); PennEast Pipeline Co., LLC, 164 FERC

¶ 61,098, at P 33 n.82 (2018)).

Docket No. PL18-1-000

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steps within its authority to protect landowner interests. Specifically, the Commission

issued Order No. 871-B, which precludes authorization of construction during the

rehearing period for certificate orders and pending resolution of rehearing requests

reflecting opposition to project construction, operation, or need (subject to a time

limitation), and which establishes a general policy, subject to a case-by-case

determination, of staying certificate orders during the rehearing period and pending

Commission resolution of any timely requests for rehearing filed by landowners (also

subject to a time limitation).203

n of rehearing requests

reflecting opposition to project construction, operation, or need (subject to a time

limitation), and which establishes a general policy, subject to a case-by-case

determination, of staying certificate orders during the rehearing period and pending

Commission resolution of any timely requests for rehearing filed by landowners (also

subject to a time limitation).203

85.

We acknowledge that in many cases pipeline applicants will not be able to acquire

all the necessary right-of-way by negotiation and in such instances may need to use

eminent domain. In assessing potential impacts to landowners, the Commission will

consider the steps a pipeline applicant has already taken to acquire lands through

respectful and good faith negotiation, as well as the applicant’s plans to minimize the use

of eminent domain upon receiving a certificate. And, as discussed further below, the

potential adverse impacts to landowners, along with other adverse impacts, will be

weighed against the evidence of need and potential benefits of a proposal in determining

whether to issue a certificate of public convenience and necessity.

ii.

Impacts on Environmental Justice Communities

203 Limiting Authorizations to Proceed with Construction Activities Pending

Rehearing, Order 871-B, 86 FR 26150 (May 13, 2021), 175 FERC ¶ 61,098, order on

reh’g, Order 871-C, 86 FR 43077 (Aug. 6, 2021), 176 FERC ¶ 61,062 (2021).

ential benefits of a proposal in determining

whether to issue a certificate of public convenience and necessity.

ii.

Impacts on Environmental Justice Communities

203 Limiting Authorizations to Proceed with Construction Activities Pending

Rehearing, Order 871-B, 86 FR 26150 (May 13, 2021), 175 FERC ¶ 61,098, order on

reh’g, Order 871-C, 86 FR 43077 (Aug. 6, 2021), 176 FERC ¶ 61,062 (2021).

Docket No. PL18-1-000

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86.

Our evaluation of the impacts of a proposed interstate natural gas pipeline will

include a robust consideration of its impacts on environmental justice communities.204

We recognize that environmental justice communities have long borne a disproportionate

share of the impacts associated with industrial development near their residences,

workplaces, religious institutions, and schools. That history often comes with significant,

deleterious consequences. For example, environmental justice communities frequently

experience health disparities, such as higher rates of asthma and certain cancers relative

to society at large, which can render individuals in those communities particularly

susceptible to incremental pollution and other adverse impacts that may be caused by a

new project.205 The Commission’s public interest responsibility demands that we

seriously evaluate these considerations and incorporate them into the balancing test

outlined below.206

87.

For the Commission to adequately evaluate the impacts of a proposed project on

environmental justice communities, it is essential to promptly and properly identify such

communities. Commenters noted the insufficiency of relying only on initial screening

204 We recognize that the Commission’s environmental justice analysis will also

apply to the Commission’s authorization of liquefied natural gas facilities, pursuant to

section 3 of the NGA

ts of a proposed project on

environmental justice communities, it is essential to promptly and properly identify such

communities. Commenters noted the insufficiency of relying only on initial screening

204 We recognize that the Commission’s environmental justice analysis will also

apply to the Commission’s authorization of liquefied natural gas facilities, pursuant to

section 3 of the NGA. While those authorizations are not the subject of this Updated

Policy Statement, this commitment is worth noting in this discussion of impacts on

environmental justice communities.

205 Policy Integrity 2021 Comments at 46-47, 55-56.

206 Vecinos para el Bienestar de la Comunidad Costera v. FERC, 6 F.4th 1321

(D.C. Cir. 2021) (Vecinos) (remanding a Commission order based in part on a “deficient”

environmental justice analysis).

Docket No. PL18-1-000

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tools to identify environmental justice communities.207 While data from screening tools

such as the EPA’s EJSCREEN may be useful, additional data collection methods may be

necessary to properly identify environmental justice communities. We encourage

applicants to consult with guidance provided by EPA, CEQ, and other authoritative

sources,208 to ensure that the Commission has before it all the data needed to adequately

identify environmental justice communities potentially affected by a proposed project.

We will evaluate and incorporate, as appropriate, any subsequently issued guidance when

considering how to identify environmental justice communities affected by a proposed

project. We encourage project developers to do the same.

88.

Many commenters encourage the Commission to factor in demographic

considerations—such as disability, age, household income, pre-existing health conditions,

and level of education.209 We recognize that such demographic considerations may be

appropriate to consider on a project-by-project basis or as federal guidance evolves.

project. We encourage project developers to do the same.

88.

Many commenters encourage the Commission to factor in demographic

considerations—such as disability, age, household income, pre-existing health conditions,

and level of education.209 We recognize that such demographic considerations may be

appropriate to consider on a project-by-project basis or as federal guidance evolves.

89.

Additionally, we recognize that proper selection of both the geographic unit of

analysis (e.g., census block group) within the affected environment and the reference

community (e.g., county/parish, or state) is necessary to ensure that affected

207 For example, screening tool data “may need to be supplemented with additional

or more localized information and/or ground truthing.” EPA 2021 Comments at 7, 9.

208 This may include, for example, relevant state or local agencies. We also note

that federal agencies, including EPA and CEQ, are in the process of updating their

guidance regarding environmental justice.

209 North Carolina DEQ 2018 Comments at 8. See also Niskanen Center 2018

Comments at 17-19.

Docket No. PL18-1-000

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environmental justice communities are properly identified for consideration in the

Commission’s analysis.210 The affected environment for environmental justice analysis

purposes may vary according to the characteristics of the particular project and the

surrounding communities.211 Accordingly, the Commission will ensure that the

delineation of the affected area, selected geographic unit of analysis, and reference

community are consistent with best practices and federal guidance and will not be limited

to a one-size-fits-all approach.212

90.

The consideration of cumulative impacts213 is particularly important when it

comes to conducting an environmental justice analysis.214 An environmental analysis

210 An overly broad geographic unit of analysis, for example, could dilute the

presence of environmental justice communities

with best practices and federal guidance and will not be limited

to a one-size-fits-all approach.212

90.

The consideration of cumulative impacts213 is particularly important when it

comes to conducting an environmental justice analysis.214 An environmental analysis

210 An overly broad geographic unit of analysis, for example, could dilute the

presence of environmental justice communities. See Policy Integrity 2021 Comments at

46-48; see also Federal Interagency Working Group on Environmental Justice & NEPA

Committee, Promising Practices for EJ Methodologies in NEPA Reviews at 21, 26

(March 2016), https://www.epa.gov/sites/production/files/2016-

08/documents/nepa_promising_practices_document_2016.pdf (EJ IWG & NEPA

Committee).

211 See Vecinos, 6 F.4th at 1330 (“When conducting an environmental justice

analysis, an agency’s delineation of the area potentially affected by the project must be

‘reasonable and adequately explained,’ . . . and include ‘a rational connection between

the facts found and the decision made.’” (citations omitted)).

212 See EJ IWG & NEPA Committee at 21-28.

213 “‘Cumulative impact’ is the impact on the environment which results from the

incremental impact of the action when added to other past, present, and reasonably

foreseeable future actions regardless of what agency (Federal or non-Federal) or person

undertakes such other actions. Cumulative impacts can result from individually minor

but collectively significant actions taking place over a period of time.” 40 CFR 1508.7

e impact on the environment which results from the

incremental impact of the action when added to other past, present, and reasonably

foreseeable future actions regardless of what agency (Federal or non-Federal) or person

undertakes such other actions. Cumulative impacts can result from individually minor

but collectively significant actions taking place over a period of time.” 40 CFR 1508.7

(1978).

214 See EDF 2021 Comments at 58; Attorneys General of Massachusetts et al.

Docket No. PL18-1-000

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that, for example, considers incremental impacts of a project in isolation will, almost by

definition, fail to adequately consider the project’s impact on a community that already

experiences elevated levels of pollution or other adverse impacts. To adequately capture

the effects of cumulative impacts, it is essential that the Commission consider those pre-

existing conditions and how the adverse impacts of a proposed project may interact with

and potentially exacerbate them. To that end, several commenters provide

recommendations for specific health and environmental indicators that the Commission

should consider when it evaluates cumulative exposures. These include factors such as

air pollution, heat vulnerability, as well as the effects of pre-existing infrastructure (e.g.,

bus depots, highways, and waste facilities).215 That analysis can be informed by a wide

range of data, including, for example, health statistics such as cancer clusters, asthma

rates, social vulnerability data, and community resilience data.216 We will carefully

examine cumulative impacts on environmental justice communities and encourage

applicants to identify and submit any such data that may be relevant for the particular

environmental justice communities affected by their proposed project.

2021 Comments at 31; Delaware Riverkeeper & Berks Gas Truth 2021 Comments at 78

and 83; and SOIL 2021 Comments at 3.

215 New Jersey Conservation Foundation et al. 2021 Comments 2021 at 36-37

mental justice communities and encourage

applicants to identify and submit any such data that may be relevant for the particular

environmental justice communities affected by their proposed project.

2021 Comments at 31; Delaware Riverkeeper & Berks Gas Truth 2021 Comments at 78

and 83; and SOIL 2021 Comments at 3.

215 New Jersey Conservation Foundation et al. 2021 Comments 2021 at 36-37.

216 EPA, EnviroAtlas Interactive Map,

https://www.epa.gov/enviroatlas/enviroatlas-interactive-map (last visited Feb. 1, 2022);

Centers for Disease Control and Prevention, Social Vulnerability Index Interactive Map,

https://svi.cdc.gov/map.html (last visited Feb. 1, 2022).

Docket No. PL18-1-000

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91.

The Commission will also consider measures to eliminate or mitigate a project’s

adverse impacts on environmental justice communities. We recognize that mitigation

must be tailored to the needs of different environmental justice communities. This will

require close consultation between the project developer, the communities in question,

and the Commission, consistent with our ex parte regulations.217 We will look with

disfavor on mitigation proposals that are proposed without sufficient community input.

In addition, we note that effective mitigation will require the Commission to consider,

among other things, the feasibility of proposed mitigation and methods for ensuring

compliance, the timing of proposed mitigation, and, where useful, a range of potential

mitigation options.

92.

As described above, in June 2021, the Commission established OPP to help

facilitate public participation in Commission proceedings. We anticipate that OPP will

similarly play an important role in ensuring that environmental justice communities are

able to participate meaningfully in section 7 certificate proceedings that affect their

interests

a range of potential

mitigation options.

92.

As described above, in June 2021, the Commission established OPP to help

facilitate public participation in Commission proceedings. We anticipate that OPP will

similarly play an important role in ensuring that environmental justice communities are

able to participate meaningfully in section 7 certificate proceedings that affect their

interests. We also recognize the adverse impacts that natural gas infrastructure can have

on Native American Tribes and Tribal resources, and we will continue to review our

existing processes to ensure that the Commission is engaging in effective government-to-

government consultation with Tribes and receiving and considering Tribal input on

proposals.

217 18 CFR 385.2201.

Docket No. PL18-1-000

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93.

In sum, we recognize that “environmental justice is not merely a box to be

checked”218 and we commit to ensuring that such concerns are fully considered in our

public interest analysis under NGA section 7. We expect the principles and concerns

outlined above will guide that consideration as the Commission continues to develop its

environmental justice precedent. Finally, as noted above, we recognize that federal

agencies, including EPA and CEQ, are in the process of updating their guidance

regarding environmental justice and we will review and incorporate, as appropriate, any

future guidance in our case-by-case decision-making process.

Assessing Public Benefits and Adverse Effects

94.

In deciding whether to issue a certificate of public convenience and necessity, the

Commission must decide whether, on balance, the project will serve the public interest.

In order to make such a determination, the Commission must consider all of the benefits

of a proposal together with all of the adverse impacts, including the economic and

environmental impacts.

and Adverse Effects

94.

In deciding whether to issue a certificate of public convenience and necessity, the

Commission must decide whether, on balance, the project will serve the public interest.

In order to make such a determination, the Commission must consider all of the benefits

of a proposal together with all of the adverse impacts, including the economic and

environmental impacts.

95.

As discussed above, under the 1999 Policy Statement, the Commission would first

determine whether, given an applicant’s efforts to mitigate or minimize impacts, there

would be any residual adverse effects on the economic interests of the existing customers

of the pipeline applicant, existing pipelines in the market and their captive customers, or

landowners and communities affected by the proposal. If so, the Commission would

218 Friends of Buckingham v. State Air Pollution Control Bd., 947 F.3d 68, 92

(4th Cir. 2020).

Docket No. PL18-1-000

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balance the evidence of public benefits to be achieved by the project against those

residual adverse effects on economic interests. If the benefits outweighed the adverse

economic effects, the Commission would then consider the environmental impacts

associated with the proposal.219

96.

As noted above, today, the Commission and staff review the economic and

environmental impacts of projects concurrently. Thus, the sequential framing of these

analyses in the 1999 Policy Statement has created some confusion and incorrectly

conveyed how the Commission considers economic and environmental impacts.

Accordingly, to provide clarity regarding our decision-making process, we explain that,

in order to determine whether a proposed project is in the public interest, we must look at

the entirety of a proposal and balance all its benefits against all of its adverse impacts.

97.

In assessing the public benefits of a project, the Commission intends to consider

all benefits that will be provided by the project

provide clarity regarding our decision-making process, we explain that,

in order to determine whether a proposed project is in the public interest, we must look at

the entirety of a proposal and balance all its benefits against all of its adverse impacts.

97.

In assessing the public benefits of a project, the Commission intends to consider

all benefits that will be provided by the project. The most important consideration in

assessing benefits will be the evidence demonstrating that a project is needed, as

discussed in more detail above. The Commission will also consider any benefits beyond

demand that are alleged by the applicant and supported in the record, which may include

evidence that the project will displace more pollution-heavy generation sources, facilitate

the integration of renewable energy sources, and/or result in a significant source of jobs

or tax revenues (we note that temporary impacts associated with a proposal will generally

be given less weight).

219 1999 Policy Statement, 88 FERC at 61,745-46.

Docket No. PL18-1-000

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98.

In assessing the adverse impacts of a proposal, we will consider the range of

impacts to: (1) existing customers of the pipeline applicant; (2) existing pipelines in the

market and their captive customers; (3) environmental resources; and (4) landowners and

surrounding communities, including environmental justice communities. In reviewing

those adverse impacts, the Commission will carefully consider the extent to which an

applicant will be able to mitigate any adverse impacts through applicant-proposed

measures or additional measures that the Commission could require.

eir captive customers; (3) environmental resources; and (4) landowners and

surrounding communities, including environmental justice communities. In reviewing

those adverse impacts, the Commission will carefully consider the extent to which an

applicant will be able to mitigate any adverse impacts through applicant-proposed

measures or additional measures that the Commission could require.

99.

Consistent with the 1999 Policy Statement, we believe that “[t]he more interests

adversely affected or the more adverse impact a project would have on a particular

interest, the greater the showing of public benefits from the project required to balance

the adverse impact.”220 And, as the Commission did in the 1999 Policy Statement, we

decline to adopt any bright-line standards for how we will carry out this balancing;221

rather, the approach must remain flexible enough for the Commission to resolve specific

cases and take into account the different interests that must be considered. We do make

clear, however, that there may be proposals denied solely on the magnitude of a particular

adverse impact to any of the four interests described above if the adverse impacts, as a

whole, outweigh the benefits of the project and cannot be mitigated or minimized. On

the other hand, there may be proposals that have significant impacts but are still found to

be in the public interest if the public benefits outweigh those impacts.

220 Id. at 61,749.

221 Id.

agnitude of a particular

adverse impact to any of the four interests described above if the adverse impacts, as a

whole, outweigh the benefits of the project and cannot be mitigated or minimized. On

the other hand, there may be proposals that have significant impacts but are still found to

be in the public interest if the public benefits outweigh those impacts.

220 Id. at 61,749.

221 Id.

Docket No. PL18-1-000

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Applicability of the Updated Certificate Policy Statement

100. A major purpose of this Updated Policy Statement is to provide clarity and

regulatory certainty regarding the Commission’s decision-making process. Therefore,

the Updated Policy Statement will not be applied retroactively to cases where a certificate

has already been issued and investment decisions have been made. However, the

Commission will apply the Updated Policy Statement to any currently pending

applications for new certificates. Applicants will be given the opportunity to supplement

the record and explain how their proposals are consistent with this Updated Policy

Statement, and stakeholders will have an opportunity to respond to any such filings.

VI.

Information Collection Statement

101. The collection of information discussed in the Updated Policy Statement is

being submitted to the Office of Management and Budget (OMB) for review under

section 3507(d) of the Paperwork Reduction Act of 1995222 and OMB’s implementing

regulations.223 OMB must approve information collection requirements imposed by

agency rules.224 Respondents will not be subject to any penalty for failing to comply

222 44 U.S.C. 3507(d).

223 5 CFR 1320.

224 This Updated Policy Statement does not require the collection of any

information, but rather discusses information that entities may elect to provide. The

Commission is following Paperwork Reduction Act procedures to ensure compliance

with that act.

mposed by

agency rules.224 Respondents will not be subject to any penalty for failing to comply

222 44 U.S.C. 3507(d).

223 5 CFR 1320.

224 This Updated Policy Statement does not require the collection of any

information, but rather discusses information that entities may elect to provide. The

Commission is following Paperwork Reduction Act procedures to ensure compliance

with that act.

Docket No. PL18-1-000

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with a collection of information if the collection does not display a valid OMB control

number.

102. The Commission solicits comments from the public on the Commission’s need for

this information, whether the information will have practical utility, the accuracy of the

burden estimates, recommendations to enhance the quality, utility, and clarity of the

information to be collected, and any suggested methods for minimizing respondents’

burden, including the use of automated information techniques. PUBLIC COMMENTS

ARE DUE [INSERT DATE 60 DAYS AFTER DATE OF PUBLICATION IN THE

FEDERAL REGISTER]. The burden estimates are focused on implementing the

voluntary information collection pursuant to this Updated Policy Statement. The

Commission asks that any revised burden estimates submitted by commenters include the

details and assumptions used to generate the estimates.

103. The following estimate of reporting burden is related only to this Updated Policy

Statement.

104. Public Reporting Burden: The collection of information related to this Updated

Policy Statement falls under FERC-537 and impacts the burden estimates associated with

the “Interstate Certificate and Abandonment Applications” component of FERC-537.

Docket No. PL18-1-000

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The Updated Policy Statement will not impact the burden estimates related to any other

component of FERC-537.225 The estimated annual burden226 and cost227 follow.

Modifications to FERC-537 (Gas Pipeline Certificates: Construction, Acquisition, and

Abandonment)

as a result of PL18-1-000

Number of

Respondents

ent Applications” component of FERC-537.

Docket No. PL18-1-000

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The Updated Policy Statement will not impact the burden estimates related to any other

component of FERC-537.225 The estimated annual burden226 and cost227 follow.

Modifications to FERC-537 (Gas Pipeline Certificates: Construction, Acquisition, and

Abandonment)

as a result of PL18-1-000

Number of

Respondents

(1)

Annual

Number of

Responses

per

Respondent

(2)

Total

Number of

Responses

(1)*(2)=(3)

Average

Burden &

Cost Per

Response

(4)

Total

Annual

Burden

Hours &

Total

Annual

Cost

(3)*(4)=(5)

Cost per

Respondent

($)

(5)÷(1)

Interstate

Certificate and

Abandonment

Applications

880 hours;

$76,560

Increase

35,200

hours;

$3,062,400

Increase

$76,560

Increase

105. Title: FERC-537, Gas Pipeline Certificates: Construction, Acquisition and

Abandonment.

225 The Updated Policy Statement will not impact burden estimates to the

following components of FERC-537: Pipeline Purging/Testing Exemptions, Blanket

Certificates Prior Notice Filings, Blanket Certificates-Annual Reports, Section 311

Construction-Annual Reports, Request for Waiver of Capacity Release Regulations,

Interstate and Intrastate Bypass Notice, Blanket Certificates, or Hinshaw Blanket

Certificates.

226 Burden is defined as the total time, effort, or financial resources expended by

persons to generate, maintain, retain, or disclose or provide information to or for a federal

agency. See 5 CFR 1320 for additional information on the definition of information

collection burden.

227 Commission staff estimates that the industry’s average hourly cost for this

information collection is approximated by the Commission’s average hourly cost (for

wages and benefits) for 2021, or $87.00/hour.

enerate, maintain, retain, or disclose or provide information to or for a federal

agency. See 5 CFR 1320 for additional information on the definition of information

collection burden.

227 Commission staff estimates that the industry’s average hourly cost for this

information collection is approximated by the Commission’s average hourly cost (for

wages and benefits) for 2021, or $87.00/hour.

Docket No. PL18-1-000

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106. Action: Proposed revisions to an existing information collection.

107. OMB Control No.: 1902-0060.

108. Respondents: Entities proposing natural gas projects under section 7 of the NGA.

109. Frequency of Information Collection: On occasion.

110. Necessity of Voluntary Information Collection: The Commission’s existing

FERC-537 information collection pertains to regulations implementing section 7 of the

NGA, which authorizes the Commission to issue certificates of public convenience and

necessity for the construction and operation of facilities transporting natural gas in

interstate commerce. The information collected pursuant to this Updated Policy

Statement should help the Commission in making its public interest determinations.

111. Internal Review: The opportunity to file the information conforms to the

Commission's plan for efficient information collection, communication, and management

within the natural gas pipeline industry. The Commission has assured itself, by means of

its internal review, that there is specific, objective support for the burden estimates

associated with the opportunity to file the information.

112. Interested persons may provide comments on this information collection by one of

the following methods:

• Electronic Filing (preferred): Documents must be filed in acceptable native

applications and print-to-PDF, but not in scanned or picture format.

• USPS: Federal Energy Regulatory Commission, Office of the Secretary, 888 First

Street, NE, Washington, DC 20426.

le the information.

112. Interested persons may provide comments on this information collection by one of

the following methods:

• Electronic Filing (preferred): Documents must be filed in acceptable native

applications and print-to-PDF, but not in scanned or picture format.

• USPS: Federal Energy Regulatory Commission, Office of the Secretary, 888 First

Street, NE, Washington, DC 20426.

Docket No. PL18-1-000

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• Hard copy other than USPS: Federal Energy Regulatory Commission, Office of

the Secretary, 12225 Wilkins Avenue, Rockville, Maryland 20852.

VII. Document Availability

113. In addition to publishing the full text of this document in the Federal Register, the

Commission provides all interested persons an opportunity to view and/or print the

contents of this document via the Internet through the Commission’s Home Page

(http://www.ferc.gov). At this time, the Commission has suspended access to the

Commission’s Public Reference Room due to the President’s March 13, 2020

proclamation declaring a National Emergency concerning the Novel Coronavirus Disease

(COVID-19).

114. From the Commission’s Home Page on the Internet, this information is available

on eLibrary. The full text of this document is available on eLibrary in PDF and

Microsoft Word format for viewing, printing, and/or downloading. To access this

document in eLibrary, type the docket number excluding the last three digits of this

document in the docket number field.

115. User assistance is available for eLibrary and the Commission’s website during

normal business hours from the Commission’s Online Support at (202) 502-6652 (toll

free at 1-866-208-3676) or email at ferconlinesupport@ferc.gov, or the Public Reference

Room at (202) 502-8371, TTY (202) 502-8659. E-mail the Public Reference Room at

public.referenceroom@ferc.gov.

By the Commission. Commissioner Danly is dissenting with a separate statement

attached.

Commissioner Christie is dissenting with a separate statement

at (202) 502-6652 (toll

free at 1-866-208-3676) or email at ferconlinesupport@ferc.gov, or the Public Reference

Room at (202) 502-8371, TTY (202) 502-8659. E-mail the Public Reference Room at

public.referenceroom@ferc.gov.

By the Commission. Commissioner Danly is dissenting with a separate statement

attached.

Commissioner Christie is dissenting with a separate statement

Docket No. PL18-1-000

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attached.

( S E A L )

Kimberly D. Bose,

Secretary.

UNITED STATES OF AMERICA

FEDERAL ENERGY REGULATORY COMMISSION

Certification of New Interstate Natural Gas Facilities

Docket No. PL18-1-000

(Issued February 18, 2022)

DANLY, Commissioner, dissenting:

I dissent from the issuance of the Updated Policy Statement on Certification of

New Interstate Natural Gas Facilities.1 Before I explain my reasons for dissenting, I

would like to state from the outset that I voted for the Commission’s most recent revised

Notice of Inquiry2 considering changes to its Original Policy Statement.3

I cannot, however, support today’s issuance because it will, in combination with

the Interim Greenhouse Gas (GHG) Policy Statement,4 have profound implications for

the ability of natural gas companies to secure capital, on the timelines for Natural Gas

Act (NGA) section 75 applications to be processed, and on the costs that a pipeline and its

customers will bear as a result of the potentially unmeasurable mitigation that the

majority expects each company to propose when filing its application6 and the possibility

of further mitigation measures added unilaterally by the Commission. As I explain in

1 Certification of New Interstate Nat. Gas Facilities, 178 FERC ¶ 61,107 (2022)

(Updated Policy Statement).

2 Certification of New Interstate Nat. Gas Facilities, 174 FERC ¶ 61,125 (2021).

3 Certification of New Interstate Nat. Gas Pipeline Facilities, 88 FERC ¶ 61,227

(1999), clarified, 90 FERC ¶ 61,128, further clarified, 92 FERC ¶ 61,094

unilaterally by the Commission. As I explain in

1 Certification of New Interstate Nat. Gas Facilities, 178 FERC ¶ 61,107 (2022)

(Updated Policy Statement).

2 Certification of New Interstate Nat. Gas Facilities, 174 FERC ¶ 61,125 (2021).

3 Certification of New Interstate Nat. Gas Pipeline Facilities, 88 FERC ¶ 61,227

(1999), clarified, 90 FERC ¶ 61,128, further clarified, 92 FERC ¶ 61,094

(2000) (Original Policy Statement).

4 Consideration of Greenhouse Gas Emissions in Nat. Gas Infrastructure Project

Reviews, 178 FERC ¶ 61,108 (2022) (Interim GHG Policy Statement). I note that today’s

issuance in Docket No. PL21-3-000 “is subject to revision” and is described as an

“interim” policy statement. Id. P 1.

5 15 U.S.C. § 717f.

6 See Updated Policy Statement, 178 FERC ¶ 61,107 at P 74 (“[W]e expect

applicants to propose measures for mitigating impacts, and we will consider those

measures—or the lack thereof—in balancing adverse impacts against the potential

benefits of a proposal.”).

Docket No. PL18-1-000

- 2 -

more detail below, this policy statement contravenes the purpose of the NGA which, as

the Supreme Court has held, is to “encourage the orderly development of plentiful

supplies of . . . natural gas at reasonable prices.”7

The Commission’s Jurisdiction and the Public Convenience and Necessity

Standard are Not as Broad as the Updated Policy Statement Suggests

As an initial matter, the Commission “is a ‘creature of statute,’ having ‘no

constitutional or common law existence or authority, but only those authorities conferred

upon it by Congress.’”8 The applicable statute is the NGA, and the statutory standard

applicable to NGA section 7(c) certificate applications9 is whether a proposed project “is

or will be required by the present or future public convenience and necessity.”10

Notably, public convenience and necessity is not anywhere defined in the language

of the NGA.11 That phrase is famously ambiguous, and the statute fails to provide factors

to be weighed in arri

nd the statutory standard

applicable to NGA section 7(c) certificate applications9 is whether a proposed project “is

or will be required by the present or future public convenience and necessity.”10

Notably, public convenience and necessity is not anywhere defined in the language

of the NGA.11 That phrase is famously ambiguous, and the statute fails to provide factors

to be weighed in arriving at a determination that a proposed project “is or will be required

7 NAACP v. FPC, 425 U.S. 662, 669-70 (1976) (citations omitted) (NAACP);

accord Myersville Citizens for a Rural Cmty., Inc. v. FERC, 783 F.3d 1301, 1307 (D.C.

Cir. 2015) (quoting NAACP, 425 U.S. at 669-70) (Myersville).

8 Atl. City Elec. Co. v. FERC, 295 F.3d 1, 8 (D.C. Cir. 2002) (quoting Michigan v.

EPA, 268 F.3d 1075, 1081 (D.C. Cir. 2001)) (emphasis in original).

9 15 U.S.C. § 717f(c).

10 Id. § 717f(e) (“[A] certificate shall be issued to any qualified applicant

therefor, . . . if it is found that the applicant is able and willing properly to do the acts and

to perform the service proposed and to conform to the provisions of this chapter and the

requirements, rules, and regulations of the Commission thereunder, and that the proposed

service, sale, operation, construction, extension, or acquisition, to the extent authorized

by the certificate, is or will be required by the present or future public convenience and

necessity; otherwise such application shall be denied.”) (emphasis added); see Okla. Nat.

Gas Co. v. FPC, 257 F.2d 634, 639 (D.C. Cir. 1958) (“The granting or denial of a

certificate of public convenience and necessity is a matter peculiarly within the discretion

of the Commission.”).

11 Cf. ICC v. Parker, 326 U.S. 60, 65 (1945) (“Public convenience and necessity is

not defined by the statute. The nouns in the phrase possess connotations which have

evolved from the half-century experience of government in the regulation of

transportation.”); see generally S. Rep. No

cate of public convenience and necessity is a matter peculiarly within the discretion

of the Commission.”).

11 Cf. ICC v. Parker, 326 U.S. 60, 65 (1945) (“Public convenience and necessity is

not defined by the statute. The nouns in the phrase posse

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