Policy Statement Regarding Consideration of Greenhouse Gas Emissions in Natural Gas Infrastructure Project Reviews
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UNITED STATES OF AMERICA
FEDERAL ENERGY REGULATORY COMMISSION
[Docket No. PL21-3-000]
Consideration of Greenhouse Gas Emissions in Natural Gas Infrastructure Project
Reviews
(Issued February 18, 2022)
AGENCY: Federal Energy Regulatory Commission.
ACTION: Interim policy statement.
SUMMARY: This interim policy statement describes Commission procedures for
evaluating climate impacts under NEPA and describes how the Commission will
integrate climate considerations into its public interest determinations under the NGA.
DATES: Comments that pertain to the Paperwork Reduction Act are due 60 days after
issuance in the Federal Register.
ADDRESSES: Comments, identified by docket number, may be filed electronically at
http://www.ferc.gov in acceptable native applications and print-to-PDF, but not in
Scanned or picture format. For those unable to file electronically, comments may be filed
by mail or hand-delivery to: Federal Energy Regulatory Commission, Secretary of the
Commission, 888 First Street, NE, Washington, DC 20426. The Comment Procedures
section of this document contains more detailed filing procedures.
FOR FURTHER INFORMATION CONTACT:
Karin Larson (Legal Information)
Office of the General Counsel
888 First Street, NE
Washington, DC 20426
(202) 502-8236
Docket No. PL21-3-000
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Karin.Larson@ferc.gov
Eric Tomasi (Technical Information)
Office of Energy Projects
Federal Energy Regulatory Commission
888 First Street, NE
Washington, DC 20426
ailed filing procedures.
FOR FURTHER INFORMATION CONTACT:
Karin Larson (Legal Information)
Office of the General Counsel
888 First Street, NE
Washington, DC 20426
(202) 502-8236
Docket No. PL21-3-000
- 2 -
Karin.Larson@ferc.gov
Eric Tomasi (Technical Information)
Office of Energy Projects
Federal Energy Regulatory Commission
888 First Street, NE
Washington, DC 20426
(202) 502-8097
Eric.Tomasi@ferc.gov
SUPPLEMENTARY INFORMATION:
178 FERC ¶ 61,108
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.
Consideration of Greenhouse Gas Emissions in Natural
Gas Infrastructure Project Reviews
Docket No. PL21-3-000
INTERIM POLICY STATEMENT
(Issued February 18, 2022)
The Commission is issuing this interim policy statement to explain how the
Commission will assess the impacts of natural gas infrastructure projects on climate
change in its reviews under the National Environmental Policy Act (NEPA) and the
Natural Gas Act (NGA). We seek comment on all aspects of the interim policy
statement, including, in particular, on the approach to assessing the significance of the
proposed project’s contribution to climate change. Although the guidance contained
herein is subject to revision based on the record developed in this proceeding, we will
begin applying the framework established in this policy statement in the interim. Doing
so will allow the Commission to evaluate and act on pending applications under
sections 3 and 7 of the NGA without undue delay and with an eye toward greater
certainty and predictability for all stakeholders.
I.
Introduction
Climate change poses a severe threat to the nation’s security, economy,
environment, and to the health of individual citizens. Human-made greenhouse gas
rim. Doing
so will allow the Commission to evaluate and act on pending applications under
sections 3 and 7 of the NGA without undue delay and with an eye toward greater
certainty and predictability for all stakeholders.
I.
Introduction
Climate change poses a severe threat to the nation’s security, economy,
environment, and to the health of individual citizens. Human-made greenhouse gas
Docket No. PL21-3-000
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(GHG) emissions, including carbon dioxide and methane, are the primary cause of
climate change.1 GHG emissions are released in large quantities through the production,
transportation, and consumption of natural gas. Accordingly, to fulfill its statutory
responsibilities, it is critical that the Commission consider and document how its
authorization of infrastructure projects under the NGA, particularly natural gas
transportation facilities, will affect emissions of GHGs.2
This policy statement describes Commission procedures for evaluating climate
impacts under NEPA, both those caused by a project’s contribution to climate change and
the impacts of climate change on the project, and describes how the Commission will
integrate climate considerations into its public interest determinations under the NGA.
For purposes of assessing the appropriate level of NEPA review, Commission staff will
apply the 100% utilization or “full burn” rate for the proposed project’s emissions to
determine whether to prepare an Environmental Impact Statement (EIS) or an
environmental assessment (EA). Commission staff will proceed with the preparation of
an EIS, if the proposed project may result in 100,000 metric tons per year of CO2e or
1 INTERGOVERNMENTAL PANEL ON CLIMATE CHANGE, UNITED NATIONS,
Summary for Policymakers of CLIMATE CHANGE 2021: THE PHYSICAL SCIENCE BASIS
SPM-5 (Valerie Masson-Delmotte et al. eds.) (2021),
https://www.ipcc.ch/report/ar6/wg1/downloads/report/IPCC_AR6_WGI_SPM.pdf (IPCC
Report).
2 See Sierra Club v. FERC, 867 F.3d 1357, 1374 (D.C. Cir
ject may result in 100,000 metric tons per year of CO2e or
1 INTERGOVERNMENTAL PANEL ON CLIMATE CHANGE, UNITED NATIONS,
Summary for Policymakers of CLIMATE CHANGE 2021: THE PHYSICAL SCIENCE BASIS
SPM-5 (Valerie Masson-Delmotte et al. eds.) (2021),
https://www.ipcc.ch/report/ar6/wg1/downloads/report/IPCC_AR6_WGI_SPM.pdf (IPCC
Report).
2 See Sierra Club v. FERC, 867 F.3d 1357, 1374 (D.C. Cir. 2017) (Sabal Trail)
(requiring the Commission to consider the reasonably foreseeable GHG emissions
resulting from natural gas projects).
Docket No. PL21-3-000
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more.3 As further described below, the Commission believes this estimate is appropriate
because it captures Commission projects that may result in incremental GHG emissions
that may have a significant effect upon the human environment.4 This approach is
consistent with the overall goal of NEPA to require a “hard look” at adverse
environmental impacts and assess whether those can be minimized or avoided.5 To
appropriately assess possible mitigation, as further explained below, the Commission will
determine a project’s reasonably foreseeable GHG emissions based on a projection of the
amount of capacity that will be actually used (projected utilization rate), as opposed to
assuming 100% utilization, and any other factors impacting the quantification of project
emissions. The Commission’s NEPA analysis will examine any proposed measures to
reduce reasonably foreseeable emissions.
When considering under the NGA whether a project is in the public interest, the
Commission considers a project’s impacts on climate change, and, accordingly, will
3 Carbon dioxide equivalent is the combination of the emissions that contribute to
climate change adjusted using each pollutant’s global warming potential. This allows the
Commission to aggregate all GHG emissions into a single value that accounts for each
chemical’s specific potential to trap heat in the atmosphere.
4 See, e.g., Grand Canyon Trust v. FAA, 290 F.3d 339, 340 (D.C. Cir
ill
3 Carbon dioxide equivalent is the combination of the emissions that contribute to
climate change adjusted using each pollutant’s global warming potential. This allows the
Commission to aggregate all GHG emissions into a single value that accounts for each
chemical’s specific potential to trap heat in the atmosphere.
4 See, e.g., Grand Canyon Trust v. FAA, 290 F.3d 339, 340 (D.C. Cir. 2002)
(“If any ‘significant’ environmental impacts might result from the proposed agency
action[,] then an EIS must be prepared before agency action is taken.” (quoting Sierra
Club v. Peterson, 717 F.2d 1409, 1415 (D.C. Cir. 1983))); Found. for N. Am. Wild Sheep
v. U.S. Dep’t of Agr., 681 F.2d 1172, 1178 (9th Cir. 1982) (“If substantial questions are
raised whether a project may have a significant effect upon the human environment, an
EIS must be prepared.”).
5 See 42 U.S.C. 4331(a); 4332(c).
Docket No. PL21-3-000
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consider proposals by the project sponsor to mitigate all or a portion of the project’s
climate change impacts, and the Commission may condition its authorization on the
project sponsor further mitigating those impacts.
This policy statement does not establish binding rules and is intended to explain
how the Commission will consider these issues when they arise.6
II.
Background
A.
GHG Emissions and Climate Change
Climate change is the variation in the Earth’s climate (including temperature,
precipitation, humidity, wind, and other meteorological variables) over time. Climate
change is driven by accumulation of GHGs in the atmosphere due to the increased
consumption of fossil fuels (e.g., coal, petroleum, and natural gas) since the early
6 Commissioner Danly’s dissent claims that today’s interim policy statement is “a
substantive, binding rule that is subject to judicial review.” Danly Dissent at P 46. This
interim document is intended to provide all interested entities with guidance as to how the
Commission will approach application under NGA sections 3 and 7
fuels (e.g., coal, petroleum, and natural gas) since the early
6 Commissioner Danly’s dissent claims that today’s interim policy statement is “a
substantive, binding rule that is subject to judicial review.” Danly Dissent at P 46. This
interim document is intended to provide all interested entities with guidance as to how the
Commission will approach application under NGA sections 3 and 7. It does not
“impose[] an obligation, den[y] a right, or fix[] some legal relationship.” Reliable
Automatic Sprinkler Co. v. Consumer Prod. Safety Comm'n, 324 F.3d 726, 731 (D.C. Cir.
2003). Parties that disagree with the approach outlined in the statement retain their full
rights to litigate their concerns in any individual proceeding. Cf. id. (“Final agency
action ‘marks the consummation of the agency's decisionmaking process’ and is ‘one by
which rights or obligations have been determined, or from which legal consequences will
flow.’) (quoting Bennett v. Spear, 520 U.S. 154, 178 (1997)). In addition, Commissioner
Danly speculates that “no project sponsor will believe that mitigation is optional or that
submitting an application exceeding the Interim Policy Statement’s 100,000 tpy threshold
without a mitigation proposal would be anything other than a waste of time and money.”
Danly Dissent PP 46-47. In response, we note only that the Commission will consider
mitigation on a case-by-case basis and that we have not suggested that GHG emissions
must be mitigated to insignificant levels in order for us to conclude that a proposed
project is required by the public convenience and necessity or consistent with the public
interest.
other than a waste of time and money.”
Danly Dissent PP 46-47. In response, we note only that the Commission will consider
mitigation on a case-by-case basis and that we have not suggested that GHG emissions
must be mitigated to insignificant levels in order for us to conclude that a proposed
project is required by the public convenience and necessity or consistent with the public
interest.
Docket No. PL21-3-000
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beginnings of the industrial age and accelerating in the mid- to late-20th century.7 The
GHGs produced by fossil-fuel combustion are carbon dioxide, methane, and nitrous
oxide.
In 2017 and 2018, the U.S. Global Change Research Program8 issued its Climate
Science Special Report: Fourth National Climate Assessment, Volumes I and II.9 This
report and the recently released report by the Intergovernmental Panel on Climate
Change, Climate Change 2021: The Physical Science Basis, state that climate change has
resulted in a wide range of impacts across every region of the country and the globe.
Those impacts extend beyond atmospheric climate change and include changes to water
resources, agriculture, ecosystems, human health, and ocean systems.10 According to the
7 IPCC Report at SPM-5. Other forces contribute to climate change, such as
agriculture, forest clearing, and other anthropogenically driven sources.
8 The U.S. Global Change Research Program is the leading U.S. scientific body on
climate change. It comprises representatives from 13 federal departments and agencies
and issues reports every 4 years that describe the state of the science relating to climate
change and the effects of climate change on different regions of the United States and on
various societal and environmental sectors, such as water resources, agriculture, energy
use, and human health.
9 U.S. GLOBAL CHANGE RESEARCH PROGRAM, CLIMATE SCIENCE SPECIAL
REPORT, FOURTH NATIONAL CLIMATE ASSESSMENT | VOLUME I (Donald J. Wuebbles et
al
ibe the state of the science relating to climate
change and the effects of climate change on different regions of the United States and on
various societal and environmental sectors, such as water resources, agriculture, energy
use, and human health.
9 U.S. GLOBAL CHANGE RESEARCH PROGRAM, CLIMATE SCIENCE SPECIAL
REPORT, FOURTH NATIONAL CLIMATE ASSESSMENT | VOLUME I (Donald J. Wuebbles et
al. eds) (2017),
https://science2017.globalchange.gov/downloads/CSSR2017_FullReport.pdf;
U.S. GLOBAL CHANGE RESEARCH PROGRAM, FOURTH NATIONAL CLIMATE ASSESSMENT,
VOLUME II IMPACTS, RISKS, AND ADAPTATION IN THE UNITED STATES (David Reidmiller
et al. eds.) (2018),
https://nca2018.globalchange.gov/downloads/NCA4_2018_FullReport.pdf (USGCRP
Report Volume II).
10 IPCC Report at SPM-5 to SPM-10.
Docket No. PL21-3-000
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Fourth Assessment Report, the United States and the world are warming, global sea level
is rising and oceans are acidifying, and certain weather events are becoming more
frequent and more severe.11 These impacts have accelerated throughout the end of the
20th century and into the 21st century.12
B.
Council on Environmental Quality Guidance on Climate Change
In 2010, the Council on Environmental Quality (CEQ) issued its first draft
guidance on how federal agencies can consider the effects of GHG emissions and climate
change under NEPA.13 CEQ revised the draft guidance in 2014,14 and issued final
guidance in 2016.15 Throughout the guidance’s evolution, CEQ advised agencies to
quantify GHG emissions and to consider both the extent to which a proposed project’s
GHG emissions would contribute to climate change and how a changing climate may
impact the proposed project. The 2016 guidance, however, explicitly declined to
11 USGCRP Report Volume II at 73-75.
12 See, e.g., USGCRP Report Volume II at 99 (describing accelerating flooding
rates in Atlantic and Gulf Coast cities)
GHG emissions and to consider both the extent to which a proposed project’s
GHG emissions would contribute to climate change and how a changing climate may
impact the proposed project. The 2016 guidance, however, explicitly declined to
11 USGCRP Report Volume II at 73-75.
12 See, e.g., USGCRP Report Volume II at 99 (describing accelerating flooding
rates in Atlantic and Gulf Coast cities).
13 CEQ, Draft NEPA Guidance on Consideration of the Effects of Climate Change
and Greenhouse Gas Emissions (Feb. 18, 2010), https://ceq.doe.gov/docs/ceq-
regulations-and-guidance/20100218-nepa-consideration-effects-ghg-draft-guidance.pdf.
14 Revised Draft Guidance for Federal Departments and Agencies on
Consideration of Greenhouse Gas Emissions and the Effects of Climate Change in NEPA
Reviews, 79 FR 77802 (Dec. 24, 2014).
15 CEQ, Final Guidance for Federal Departments and Agencies on Consideration
of Greenhouse Gas Emissions and the Effects of Climate Change in National
Environmental Policy Act Reviews (Aug. 1, 2016), https://ceq.doe.gov/docs/ceq-
regulations-and-guidance/nepa_final_ghg_guidance.pdf (2016 CEQ Guidance).
Docket No. PL21-3-000
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establish a quantity or threshold of GHGs for determining whether a proposed project
will have a significant impact on climate.16
CEQ rescinded the 2016 guidance in April 2017, as directed by Executive Order
13783 Promoting Energy Independence and Economic Growth,17 and issued revised draft
guidance in June 2019.18 In January 2021, Executive Order 13990 Protecting Public
Health and the Environment and Restoring Science to Tackle the Climate Crisis revoked
Executive Order 13783 and directed CEQ to rescind the 2019 draft guidance and to
review, revise, and update the 2016 guidance.19 CEQ has not yet issued an update to the
2016 guidance, but, in the interim, has directed agencies to consider all available tools
and resources, including the 2016 guidance, in assessing GHG emissions and the climate
change effects of proposed actions.20
16 2016 CE
ecutive Order 13783 and directed CEQ to rescind the 2019 draft guidance and to
review, revise, and update the 2016 guidance.19 CEQ has not yet issued an update to the
2016 guidance, but, in the interim, has directed agencies to consider all available tools
and resources, including the 2016 guidance, in assessing GHG emissions and the climate
change effects of proposed actions.20
16 2016 CEQ Guidance at 9-10 (“This guidance does not establish any particular
quantity of GHG emissions as ‘significantly’ affecting the quality of the human
environment or give greater consideration to the effects of GHG emissions and climate
change over other effects on the human environment.”).
17 Exec. Order No. 13783, 82 FR 16576 (Apr. 5, 2017).
18 Draft National Environmental Policy Act Guidance on Consideration of
Greenhouse Gas Emissions, 84 FR 30097 (June 26, 2019).
19 Exec. Order No. 13990, 86 FR 7037 (Jan. 20, 2021).
20 Notice of Rescission of Draft Guidance, 86 FR 10252 (Feb. 19, 2021).
Docket No. PL21-3-000
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C.
Previous Commission Policy on Consideration of Climate Change
Under NEPA
Commission staff has addressed climate change in some fashion in its NEPA
documents for at least a decade.21 Commission staff’s NEPA documents have included
direct GHG emission estimates from project construction (e.g., tailpipe emissions from
construction equipment) and/or operation (e.g., fuel combustion at compressor stations
and gas venting and leaks).22 Starting in late 2016, the Commission began to
conservatively estimate indirect downstream GHG emissions by assuming full
combustion of the maximum annual volume of gas that could be transported by the
project.23 For indirect upstream, production-related GHG emissions, Commission orders
during that time period relied on Department of Energy studies to calculate broad
estimates.24 For upstream impacts, the Commission generally indicated that these
analyses were not required by NEPA because the Commission lacked detailed
21 For details on GHG ana
me of gas that could be transported by the
project.23 For indirect upstream, production-related GHG emissions, Commission orders
during that time period relied on Department of Energy studies to calculate broad
estimates.24 For upstream impacts, the Commission generally indicated that these
analyses were not required by NEPA because the Commission lacked detailed
21 For details on GHG analysis in the Commission’s NEPA documents through
April 2018, see Certification of New Interstate Natural Gas Facilities, 83 FR 18020, 163
FERC ¶ 61,042, at PP 44-50 (2018) (2018 NOI).
22 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).
23 See, e.g., Columbia Gas Transmission, LLC, 158 FERC ¶ 61,046, at P 120
(2017); Tex. E. Transmission, LP, 157 FERC ¶ 61,223, at P 41 (2016), reh’g granted, 161
FERC ¶ 61,226 (2017).
24 See, e.g., Columbia Gas Transmission, LLC, 158 FERC ¶ 61,046 at PP 116-119.
Docket No. PL21-3-000
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information about the precise source of the gas to be transported, but provided estimates
for informational purposes.25
In 2017, the United States Court of Appeals for the District of Columbia Circuit
(D.C. Circuit) in Sierra Club v. FERC (Sabal Trail)26 found that downstream GHG
emissions were an indirect effect of the Sabal Trail pipeline project and required the
Commission to give a quantitative estimate of the downstream GHG emissions resulting
from the burning of the natural gas to be transported by the pipeline or explain why the
Commission could not do so, and to discuss the significance of these emissions.27 On
remand, the Commission compared the estimated downstream GHG emissions from the
project to state and national GHG emission inventories.28 However, the Commission
concluded that it could not determine whether those downstream
the burning of the natural gas to be transported by the pipeline or explain why the
Commission could not do so, and to discuss the significance of these emissions.27 On
remand, the Commission compared the estimated downstream GHG emissions from the
project to state and national GHG emission inventories.28 However, the Commission
concluded that it could not determine whether those downstream GHG emissions were
significant and rejected the use of the Social Cost of Carbon (SCC) tool to inform the
Commission’s analysis.29
25 With respect to upstream emissions, the D.C. Circuit subsequently noted that the
Commission does not violate NEPA in not considering upstream GHG emissions where
there is no evidence to predict the number and location of additional wells that would be
drilled as a result of a project. Birckhead v. FERC, 925 F.3d 510, 518 (D.C. Cir. 2019)
(Birckhead).
26 867 F.3d 1357.
27 Id. at 1374.
28 Fla. Se. Connection, LLC, 164 FERC ¶ 61,099, at P 5 (2018).
29 Id. No party petitioned for judicial review of the Commission’s determination
on remand.
Docket No. PL21-3-000
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In 2018, the Commission stated in Dominion Transmission, Inc.30 that end use
consumption of gas and upstream production of gas were generally not reasonably
foreseeable or causally related to the project (no party had identified the specific end use
of the gas) and thus the Commission was not required to consider upstream or
downstream emissions as indirect impacts under NEPA.31 The Commission stated it
would continue to “analyze upstream and downstream environmental effects when those
effects are sufficiently causally connected to and are reasonably foreseeable effects of the
proposed action.”32 The Commission reiterated that without an accepted methodology it
could not find whether a particular quantity of GHG emissions was significant.33
However, in Birckhead, the D.C. Circuit rejected the Commission’s position that
Sabal Trail is limited to the narrow facts of that case
ts are sufficiently causally connected to and are reasonably foreseeable effects of the
proposed action.”32 The Commission reiterated that without an accepted methodology it
could not find whether a particular quantity of GHG emissions was significant.33
However, in Birckhead, the D.C. Circuit rejected the Commission’s position that
Sabal Trail is limited to the narrow 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.34 The court further noted that the Commission should attempt to
30 163 FERC ¶ 61,128 (2018), pet. dismissed, Otsego 2000 v. FERC, 767 F.App’x
19 (D.C. Cir. 2019) (unpublished opinion).
31 Id. PP 41-44, 61-62.
32 Id. P 44; see also Tenn. Gas Pipeline Co., LLC, 163 FERC ¶ 61,190, at
PP 61-62 (2018).
33 Dominion Transmission, Inc., 163 FERC ¶ 61,128 at PP 67-70.
34 Birckhead, 925 F.3d at 518-19.
Docket No. PL21-3-000
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obtain information on downstream uses to determine whether downstream GHG
emissions are a reasonably foreseeable effect of the project.35
In 2021, in Northern Natural Gas Co., the Commission explained that it had
reconsidered its position that it was unable to assess the significance of a project’s GHG
emissions or those emissions’ contribution to climate change.36 The Commission found
that that project’s reasonably foreseeable GHG emissions—construction and operation
emissions only, as the project proposed no new capacity—would not significantly
contribute to climate change.37 Later in 2021, the D.C. Circuit further criticized the
Commission’s stance prior to Northern Natural Gas Co
GHG
emissions or those emissions’ contribution to climate change.36 The Commission found
that that project’s reasonably foreseeable GHG emissions—construction and operation
emissions only, as the project proposed no new capacity—would not significantly
contribute to climate change.37 Later in 2021, the D.C. Circuit further criticized the
Commission’s stance prior to Northern Natural Gas Co. that it was unable to assess the
significance of a project’s GHG emissions or those emissions’ contribution to climate
change, holding that the Commission failed to appropriately analyze the significance of
three natural gas projects’ contribution to climate change using “theoretical approaches or
research methods generally accepted in the scientific community,” such as the SCC
tool.38
35 Id. at 520.
36 174 FERC ¶ 61,189, at P 29 (2021).
37 Id. PP 29-36.
38 Vecinos para el Bienestar de la Comunidad Costera v. FERC, 6 F.4th 1321,
1328 (D.C. Cir. 2021) (Vecinos) (citing 40 CFR 1502.21(c), which requires an EIS to
include an evaluation of impacts based upon theoretical approaches or research methods
generally accepted in the scientific community where the information relevant to the
reasonably foreseeable significant adverse impacts cannot be obtained because the means
to obtain it are not known). The case is pending on remand with the Commission.
Docket No. PL21-3-000
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D.
Certificate Policy Statement Notices of Inquiry
On April 19, 2018, the Commission issued a Notice of Inquiry (2018 NOI)39
seeking information and stakeholder perspectives to help the Commission explore
whether, and if so how, it should revise its approach for determining whether proposed
projects are consistent with the public convenience and necessity under the currently
effective policy statement on the certification of new interstate natural gas transportation
facilities (Certificate Policy Statement).40 The 2018 NOI included a background section
discussing how the legal standards and historical context informe
it should revise its approach for determining whether proposed
projects are consistent with the public convenience and necessity under the currently
effective policy statement on the certification of new interstate natural gas transportation
facilities (Certificate Policy Statement).40 The 2018 NOI included a background section
discussing how the legal standards and historical context informed the creation of the
Certificate Policy Statement in 1999, how the Commission’s evaluations under the
Certificate Policy Statement and under NEPA have evolved, and how changed
circumstances since 1999 have required the present review.41 Notably, the Commission
sought input on whether, and if so how, the Commission should adjust its evaluation of
the environmental impacts of a proposed project.
In response to the 2018 NOI, the Commission received more than 3,000 comments
from stakeholders including landowners; tribal, federal, state, and local government
officials; non-governmental organizations; consultants, academic institutions, and think
39 2018 NOI, 163 FERC ¶ 61,042.
40 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). The Commission must 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 NGA section 7. 15 U.S.C. 717f.
41 2018 NOI, 163 FERC ¶ 61,042 at PP 5-50.
e Natural Gas Pipeline Facilities, 88 FERC
¶ 61,227 (1999), clarified, 90 FERC ¶ 61,128, further clarified, 92 FERC ¶ 61,094
(2000). The Commission must 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 NGA section 7. 15 U.S.C. 717f.
41 2018 NOI, 163 FERC ¶ 61,042 at PP 5-50.
Docket No. PL21-3-000
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tanks; natural gas producers, Commission-regulated companies, local distribution
companies, and industry trade organizations; electricity generators and utilities; and
others. Many comments addressed GHG emissions.
On February 18, 2021, the Commission issued a new, refreshed Notice of Inquiry
(2021 NOI),42 seeking comments to build upon the existing record established by the
2018 NOI. The Commission posed several updated questions relating to GHG emissions,
including asking: how the Commission could consider upstream impacts from natural
gas production and downstream end-use impacts; how the Commission should determine
the significance of a project’s GHG emissions’ contribution to climate change; whether
the NGA, NEPA, or another federal statute authorize or mandate the use of the SCC
analysis by the Commission; how the Commission could determine whether a proposed
project’s GHG emissions could be offset by reduced GHG emissions resulting from the
project’s operations; and how the Commission could impose GHG emission limits or
mitigation to reduce the significance of impacts from a proposed project on climate
change.43
With respect to determining significance, the 2021 NOI sought comment on
(1) what type of metrics and models the Commission should consider in determining
42 Certification of New Interstate Natural Gas Facilities, 174 FERC ¶ 61,125
(2021).
43 Id. P 17.
Docket No. PL21-3-000
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significance, (2) whether any level of emissions should be considered de minimis, and
mate
change.43
With respect to determining significance, the 2021 NOI sought comment on
(1) what type of metrics and models the Commission should consider in determining
42 Certification of New Interstate Natural Gas Facilities, 174 FERC ¶ 61,125
(2021).
43 Id. P 17.
Docket No. PL21-3-000
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significance, (2) whether any level of emissions should be considered de minimis, and
(3) how the SCC tool or other tools could factor into determining significance.44
The public comment period for the 2021 NOI closed on May 26, 2021.45 The
Commission received over 35,000 comments and approximately 150 unique comment
letters from a wide range of stakeholders, as noted above.
Comments relevant to this policy statement are addressed in Section III below.
III.
Statutory Authority/Obligations
A.
NGA
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.46 The Commission does not have authority to
regulate intrastate transportation facilities or other facilities that affect interstate
transportation, such as those used for the production, gathering, or local distribution of
natural gas. Congress did not displace state authority over such subjects.47
44 Id. (citations omitted).
45 See Notice Extending Time for Comments, Docket No. PL18-1-000
(Mar. 31, 2021) (extending the original comment deadline from April 26, 2021, to
May 26, 2021).
46 15 U.S.C. 717f.
47 NGA section 1(b) states that Commission authority applies to interstate
transportation of natural gas and sales for resale, “but shall not apply to any other
transportation or sale of natural gas or to the local distribution of natural gas or to the
facilities used for such distribution or to the production or gathering of natural gas.”
Id. 717(b).
o
May 26, 2021).
46 15 U.S.C. 717f.
47 NGA section 1(b) states that Commission authority applies to interstate
transportation of natural gas and sales for resale, “but shall not apply to any other
transportation or sale of natural gas or to the local distribution of natural gas or to the
facilities used for such distribution or to the production or gathering of natural gas.”
Id. 717(b).
Docket No. PL21-3-000
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Section 3(a) of the NGA provides for federal jurisdiction over the siting,
construction, and operation of facilities used to import or export gas.48 To date, the
Commission has exercised section 3 authority to authorize: (1) LNG terminals located at
the site of import or export and (2) the site and facilities at the place of import/export
where a pipeline crosses an international border.49 Additionally, NGA section 3(e) states
that “[t]he Commission shall have the exclusive authority to approve or deny an
application for the siting, construction, expansion, or operation of an LNG terminal.”50
Both NGA sections 7 and 3 authorize the Commission to attach terms and
conditions to its authorization.51 Courts have interpreted these provisions broadly and
48 The 1977 Department of Energy Organization Act (42 U.S.C. 7151(b)) placed
all section 3 jurisdiction under the Department of Energy. The Secretary of Energy
subsequently delegated authority to the Commission to “[a]pprove or disapprove the
construction and operation of particular facilities, the site at which such facilities shall be
located, and with respect to natural gas that involves the construction of new domestic
facilities, the place of entry for imports or exit for exports.” Department of Energy
Delegation Order No. 00-004.00A, section 1.21A (May 16, 2006)
ted authority to the Commission to “[a]pprove or disapprove the
construction and operation of particular facilities, the site at which such facilities shall be
located, and with respect to natural gas that involves the construction of new domestic
facilities, the place of entry for imports or exit for exports.” Department of Energy
Delegation Order No. 00-004.00A, section 1.21A (May 16, 2006).
49 In addition to pipelines that cross the international border with Canada and
Mexico, the Commission has also asserted authority over the portions of subsea pipelines
planned to cross the “border” of the Exclusive Economic Zone between the U.S. and the
Bahamas. See, e.g., Tractebel Calypso Pipeline, LLC, 106 FERC ¶ 61,273 (2004),
vacated, Calypso U.S. Pipeline, LLC,137 FERC ¶ 61,098 (2011).
50 15 U.S.C. 717b(e)(1).
51 Id. 717f(e) (“The Commission shall have the power to attach to the issuance of
the certificate and to the exercise of the rights granted thereunder such reasonable terms
and conditions as the public convenience and necessity may require.”); see also id.
717b(a) (stating that the Commission may “grant such application, in whole or in part,
with such modification and upon such terms and conditions as the Commission may find
necessary or appropriate”); id. 717b(e)(3)(A) (providing the authority to approve an
Docket No. PL21-3-000
- 16 -
given the Commission latitude in deciding what types of mitigation to require.52 In
issuing authorizations, the Commission has required project sponsors to comply with
conditions to prevent or mitigate project impacts on environmental resources.53
B
e Commission may find
necessary or appropriate”); id. 717b(e)(3)(A) (providing the authority to approve an
Docket No. PL21-3-000
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given the Commission latitude in deciding what types of mitigation to require.52 In
issuing authorizations, the Commission has required project sponsors to comply with
conditions to prevent or mitigate project impacts on environmental resources.53
B.
NEPA
NEPA and its implementing regulations require agencies, before taking or
authorizing a major federal action that may significantly affect the quality of the human
environment, to take a “hard look” at the environmental consequences of the proposed
action and disclose their analyses to the public by preparing an EIS.54 Alternatively,
agencies can first prepare an Environmental Assessment (EA) for a proposed action that
is not likely to have significant effects or when the significance is unknown, to determine
whether an EIS is necessary for a particular action.55 Depending on the outcome of the
EA, agencies can either prepare an EIS or issue a finding of no significant impact.56
application for an LNG Terminal, “in whole or part, with such modifications and upon
such terms and conditions as the Commission find[s] necessary or appropriate”).
52 See Twp. of Bordentown v. FERC, 903 F.3d 234, 261 n.15 (3d Cir. 2018)
(concluding that the Commission’s authority to enforce any required remediation is
amply supported by provisions of the NGA); Sabal Trail, 867 F.3d at 1374 (holding that
the Commission has legal authority to mitigate reasonably foreseeable indirect effects).
53 See, e.g., Atl. Coast Pipeline, LLC, 161 FERC ¶ 61,042, at app. A (2017), on
reh’g, 164 FERC ¶ 61,100 (2018).
54 42 U.S.C. 4332(2)(C); 40 CFR 1502.3; see Balt. Gas & Elec. Co. v. Nat. Res.
Def. Council, Inc., 462 U.S. 87, 97 (1983) (discussing the twin aims of NEPA).
55 40 CFR 1501.5, 1508.1(h)
g that
the Commission has legal authority to mitigate reasonably foreseeable indirect effects).
53 See, e.g., Atl. Coast Pipeline, LLC, 161 FERC ¶ 61,042, at app. A (2017), on
reh’g, 164 FERC ¶ 61,100 (2018).
54 42 U.S.C. 4332(2)(C); 40 CFR 1502.3; see Balt. Gas & Elec. Co. v. Nat. Res.
Def. Council, Inc., 462 U.S. 87, 97 (1983) (discussing the twin aims of NEPA).
55 40 CFR 1501.5, 1508.1(h).
56 40 CFR 1508.1(l) (defining a finding of no significant impact as a document
that briefly presents the reasons why an action that is not otherwise categorically
Docket No. PL21-3-000
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Previous CEQ regulations and court cases have examined a proposed project’s
“context” and “intensity” or the severity of the impact as factors for determining what
constitutes a significant effect.57 In assessing significance, Commission staff considers,
for each resource, the duration of the impact as well as the geographic, biological, or
social context in which the effects would occur, and the intensity (e.g. severity) of the
impact.58 This analysis may draw on both qualitative and quantitative information.59
Using both types of data, the Commission routinely makes significance determinations
for impacts to various resources from natural gas projects.60
excluded under § 1501.4 will not have a significant effect on the human environment and
for which an EIS will therefore not be prepared).
57 Vieux Carre Prop. Owners, Residents & Assocs., Inc. v. Pierce, 719 F.2d 1272,
1279 (5th Cir. 1983) (stating there is “no hard and fast definition of ‘significant’” but
considering the proposed project’s context in assessing whether a finding of no
significance impact was reasonable). The regulations implementing NEPA previously
addressed the term “significantly,” but that provision was removed by amendments
effective September 14, 2020 and replaced with 40 CFR 1501.3(b)
279 (5th Cir. 1983) (stating there is “no hard and fast definition of ‘significant’” but
considering the proposed project’s context in assessing whether a finding of no
significance impact was reasonable). The regulations implementing NEPA previously
addressed the term “significantly,” but that provision was removed by amendments
effective September 14, 2020 and replaced with 40 CFR 1501.3(b). “Whether a project
has significant environmental impacts, thus triggering the need to produce an EIS,
depends on its ‘context’ (region, locality) and ‘intensity’ (‘severity of impact’).” Nat’l
Parks Conservation Ass’n v. Semonite, 916 F.3d 1075, 1082 (D.C. Cir.) (quoting 40 CFR
1508.27 (2018)), amended in part by 925 F.3d 500 (D.C. Cir. 2019). The new 40 CFR
1501.3(b) calls for agencies to consider the “potentially affected environment and degree
of the effects of the action” and to consider the short-term, long-term, beneficial, and
adverse effects, and effects on public safety and those that would violate laws.
58 See, e.g. Final EIS for the Alaska LNG Project, Docket No. CP17-178-000, at 4-
1.
59 See Sabal Trail, 867 F.3d at 1371 (“The EIS also gave the public and agency
decisionmakers the qualitative and quantitative tools they needed to make an informed
choice for themselves. NEPA requires nothing more.”).
60 See, e.g., Transcon. Gas Pipe Line Co., LLC, 158 FERC ¶ 61,125, at P 79
(describing how the final EIS for the Atlantic Sunrise Project concluded that the project
4-
1.
59 See Sabal Trail, 867 F.3d at 1371 (“The EIS also gave the public and agency
decisionmakers the qualitative and quantitative tools they needed to make an informed
choice for themselves. NEPA requires nothing more.”).
60 See, e.g., Transcon. Gas Pipe Line Co., LLC, 158 FERC ¶ 61,125, at P 79
(describing how the final EIS for the Atlantic Sunrise Project concluded that the project
Docket No. PL21-3-000
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In evaluating whether an impact is significant, the Commission determines
whether “it would result in a substantial adverse change in the physical environment.”61
In making that determination, the Commission considers available evidence, giving that
evidence such weight as it deems appropriate using its experience, judgment, and
expertise.62 Notably, NEPA does not require that the studies, metrics, and models on
which an agency relies be universally accepted or otherwise uncontested.63 Instead,
would result in adverse impacts that would be mitigated to less than significant levels),
order on reh’g, 161 FERC ¶ 61,250 (2017), petition denied sub nom., Allegheny Def.
Project v. FERC, 964 F.3d 1 (D.C. Cir. 2020); see also infra note 61; see also Magnum
Gas Storage, LLC, 134 FERC ¶ 61,197, at P 115 (2011) (explaining that “‘significantly,’
as used in NEPA, requires considerations of both context and intensity, which varies with
the setting of each proposed action.”).
61 N. Nat. Gas Co., 174 FERC ¶ 61,189, at P 32 (citing Magnum Gas Storage,
LLC, 134 FERC ¶ 61,197 at P 114 (“[A]n impact was considered to be significant if it
would result in a substantial adverse change in the physical environment or natural
condition and could not be mitigated to less-than-significant level.”)).
62 See, e.g., Tex
, which varies with
the setting of each proposed action.”).
61 N. Nat. Gas Co., 174 FERC ¶ 61,189, at P 32 (citing Magnum Gas Storage,
LLC, 134 FERC ¶ 61,197 at P 114 (“[A]n impact was considered to be significant if it
would result in a substantial adverse change in the physical environment or natural
condition and could not be mitigated to less-than-significant level.”)).
62 See, e.g., Tex. LNG Brownsville LLC, 169 FERC ¶ 61,130, at P 56 (2019) (“Due
to the relatively undeveloped nature of the project area, the visual sensitivity of nearby
recreation areas, and the lack of feasible visual screening measures, the Final EIS
concluded that the project would result in a significant impact on visual resources when
viewed from the adjacent Laguna Atascosa National Wildlife Refuge.”), order on reh’g,
170 FERC ¶ 61,139, at P 32 (2020), remanded on other grounds, Vecinos, 6 F.4th 1321;
Final EIS for the Alaska LNG Project, Docket No. CP17-178-000, at ES-4 (Mar. 2020)
(explaining the significant, long-term to permanent project impacts from the loss of
thousands of acres of permafrost from construction that would permanently alter
hydrology and vegetation within and past the project footprint).
63 Sierra Club v. U.S. Dep’t of Transp., 753 F.2d 120, 128 (D.C. Cir. 1985) (“It is
clearly within the expertise and discretion of the agency to determine proper testing
methods.”); see also Hughes River Watershed Conservancy v. Johnson, 165 F.3d 283,
289 (4th Cir. 1999) (“Agencies are entitled to select their own methodology as long as
that methodology is reasonable. The reviewing court must give deference to an agency's
decision.”).
F.2d 120, 128 (D.C. Cir. 1985) (“It is
clearly within the expertise and discretion of the agency to determine proper testing
methods.”); see also Hughes River Watershed Conservancy v. Johnson, 165 F.3d 283,
289 (4th Cir. 1999) (“Agencies are entitled to select their own methodology as long as
that methodology is reasonable. The reviewing court must give deference to an agency's
decision.”).
Docket No. PL21-3-000
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NEPA permits agencies to rely on the best available evidence, quantitative and
qualitative, even where that evidence has certain limitations when assessing the
significance of their actions,64 and an agency’s determination is entitled to deference.65
In addition to determining whether its actions may significantly affect the quality
of the human environment, NEPA requires the Commission to consider whether there are
steps that could be taken to mitigate any adverse environmental consequences.66 While
NEPA is a procedural statute and does not require a federal agency to reject a proposed
project with significant adverse effects or take action to mitigate adverse effects,67 an
64 See Spiller v. White, 352 F.3d 235, 244 n.5 (5th Cir. 2003) (rejecting petitioner’s
contention that the significance determination must be objective, factual, and quantitative
and should not involve any qualitative judgment calls).
65 See La. Crawfish Producers Ass’n-W. v. Rowan, 463 F.3d 352, 355 (5th Cir.
2006) (NEPA-related decisions are accorded a considerable degree of deference); Spiller
v. White, 352 F.3d at 244 n.5 (“We should note that our deference to the [l]ead
[a]gencies[’] fact-finding and conclusions includes deference to their judgment as to
whether any particular environmental impact of the proposed pipeline rises to the level of
significance”); Powder River Basin Res. Council v. U.S. Bureau of Land Mgmt., 37
F.Supp. 3d 59, 74 (D.D.C
le degree of deference); Spiller
v. White, 352 F.3d at 244 n.5 (“We should note that our deference to the [l]ead
[a]gencies[’] fact-finding and conclusions includes deference to their judgment as to
whether any particular environmental impact of the proposed pipeline rises to the level of
significance”); Powder River Basin Res. Council v. U.S. Bureau of Land Mgmt., 37
F.Supp. 3d 59, 74 (D.D.C. 2014) (agencies are afforded discretion to use their expertise
to determine the best method to evaluate the significance of an impact to a particular
resource, so long as that method is reasonable).
66 Robertson v. Methow Valley Citizens Council, 490 U.S. 332, 351 (1989) (“To be
sure, one important ingredient of an EIS is the discussion of steps that can be taken to
mitigate adverse environmental consequences.”).
67 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.”).
Docket No. PL21-3-000
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agency may require mitigation of impacts as a condition of its permitting or approval,68
and the Commission routinely does so.69
IV.
Discussion
A.
Quantifying GHG Emissions and Determining Significance
Consistent with CEQ regulations,70 the Commission will quantify a project’s GHG
emissions that are reasonably foreseeable and have a reasonably close causal relationship
to the proposed action, including those effects that occur at the same time and place as
the proposed action and effects that are later in time or farther removed in distance from
the proposed action
etermining Significance
Consistent with CEQ regulations,70 the Commission will quantify a project’s GHG
emissions that are reasonably foreseeable and have a reasonably close causal relationship
to the proposed action, including those effects that occur at the same time and place as
the proposed action and effects that are later in time or farther removed in distance from
the proposed action. This will include GHG emissions resulting from construction and
68 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).
69 See, e.g., Columbia Gas Transmission, LLC, 170 FERC ¶ 61,045, at P 66, app.
(2020) (conditioning certificate authority on site-specific mitigation measures when
crossing abandoned mine lands, including the management and disposal of contaminated
groundwater, and mitigation measures for acid mine drainage); PennEast Pipeline Co.,
LLC, 170 FERC ¶ 61,198, at PP 29-30, app. A (2020) (conditioning certificate authority
on mitigation of construction impacts on karst features); Atl. Coast Pipeline, LLC, 161
FERC ¶ 61,042 at app. A (conditioning certificate authority on the mitigation of
construction impacts on karst features and on a nearby inn and mitigation of impacts from
the discovery of invasive aquatic species during construction); Port Arthur LNG, LP, 115
FERC ¶ 61,344, at PP 68-71, app. A (conditioning sections 3 and 7 authority on the
mitigation of construction impacts on aquatic resources and wetlands), order on reh’g,
117 FERC ¶ 61,213 (2006), vacated, 136 FERC ¶ 61,196 (2011).
70 40 CFR 1508.1(g) (defining the effects or impacts that must be considered when
conducting a review under NEPA).
s during construction); Port Arthur LNG, LP, 115
FERC ¶ 61,344, at PP 68-71, app. A (conditioning sections 3 and 7 authority on the
mitigation of construction impacts on aquatic resources and wetlands), order on reh’g,
117 FERC ¶ 61,213 (2006), vacated, 136 FERC ¶ 61,196 (2011).
70 40 CFR 1508.1(g) (defining the effects or impacts that must be considered when
conducting a review under NEPA).
Docket No. PL21-3-000
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operation of the project71 as well as, in most cases, GHG emissions resulting from the
downstream combustion of transported gas.72
The Commission will consider all evidence in the record relating to a project’s
estimated GHG emissions,73 utilization rate, or offsets: estimates presented by project
sponsors, as well as opposing evidence from other parties. Going forward, in
determining the level of GHG emissions attributed to a project, the Commission will
estimate a project’s GHG emissions based on a projection of what amount of project
capacity will be actually used (projected utilization rate), as opposed to assuming 100%
utilization.74 The Commission will also consider evidence of factors expected to reduce
or offset the estimated direct or reasonably foreseeable downstream emissions of the
project.
71 Emissions quantification also includes loss of carbon storage/sinks through land
use conversions, forest clearing, wetland conversions, etc.
72 As discussed below, the vast majority of all natural gas consumed in the United
States is combusted. See infra note 101.
73 Additionally, the Commission will consider evidence regarding whether certain
emissions associated with a proposed project, such as upstream and downstream
emissions, are reasonably foreseeable.
74 See Certification of New Interstate Natural Gas Pipeline Facilities, 168 FERC
¶ 61,107, at P 55 (2022) (explaining that project sponsors are encouraged to provide the
Commission with information on estimated utilization rates and the intended end use of
gas to demonstrate project need).
ociated with a proposed project, such as upstream and downstream
emissions, are reasonably foreseeable.
74 See Certification of New Interstate Natural Gas Pipeline Facilities, 168 FERC
¶ 61,107, at P 55 (2022) (explaining that project sponsors are encouraged to provide the
Commission with information on estimated utilization rates and the intended end use of
gas to demonstrate project need).
Docket No. PL21-3-000
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1.
Categories of Emissions
CEQ regulations implementing NEPA require agencies to consider effects or
impacts that “are reasonably foreseeable and have a reasonably close causal relationship
to the proposed action . . . including those effects that occur at the same time and place as
the proposed action . . . and may include effects that are later in time or farther removed
in distance for the proposed action . . . .”75 A “but for” causal relationship is insufficient
to make an agency responsible for a particular effect,76 and effects should not be
considered if they are the “product of a lengthy causal chain.”77 Further, effects to be
considered do not include those that the agency has no ability to prevent due to its limited
statutory authority or would occur regardless of the proposed action.78 Regarding
reasonable foreseeability, courts have found that an impact is reasonably foreseeable if it
is “sufficiently likely to occur that a person of ordinary prudence would take it into
75 40 CFR 1508.1(g).
76 Id. § 1508.1(g)(2); see also U.S. Dep’t of Transp. v. Pub. Citizen, 541 U.S. 752,
767 (2004) (Pub. Citizen) (finding that “NEPA requires ‘a reasonably close causal
relationship’ between the environmental effect and the alleged cause” in order “to make
an agency responsible for a particular effect under NEPA” (quoting Metro. Edison Co. v.
People Against Nuclear Energy, 460 U.S. 766, 774 (1983) (Metro. Edison Co.))).
77 40 CFR 1508.1(g)(2); see also Metro. Edison Co., 460 U.S
767 (2004) (Pub. Citizen) (finding that “NEPA requires ‘a reasonably close causal
relationship’ between the environmental effect and the alleged cause” in order “to make
an agency responsible for a particular effect under NEPA” (quoting Metro. Edison Co. v.
People Against Nuclear Energy, 460 U.S. 766, 774 (1983) (Metro. Edison Co.))).
77 40 CFR 1508.1(g)(2); see also Metro. Edison Co., 460 U.S. at 774 (finding that
“[s]ome effects that are ‘caused by’ a change in the physical environment in the sense of
‘but for’ causation,” will not fall within NEPA if “the causal chain is too attenuated”).
78 40 CFR 1508.1(g)(2); see also Pub. Citizen, 541 U.S. at 770 (“[W]here an
agency has no ability to prevent a certain effect due to its limited statutory authority over
the relevant actions, the agency cannot be considered a legally relevant ‘cause’ of the
effect.”).
Docket No. PL21-3-000
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account in reaching a decision.”79 Although courts have held that NEPA requires
“reasonable forecasting,”80 an agency “is not required to engage in speculative
analysis”81 or “to do the impractical, if not enough information is available to permit
meaningful consideration.”82
As discussed below, the Commission proposes to:
• Consider direct emissions of a project a reasonably foreseeable effect;
• Find that an NGA section 3 export facility project is not the legally relevant
cause of upstream and downstream emissions;83
• Consider on a case-by-case basis whether downstream emissions are a
reasonably foreseeable effect of an NGA section 7 interstate project; and
• Consider on a case-by-case basis whether upstream emissions are a
reasonably foreseeable effect of an NGA 7 project.
79 EarthReports, Inc. v. FERC, 828 F.3d 949, 955 (D.C. Cir. 2016) (citations
omitted); see also Sierra Club v. Marsh, 976 F.2d 763, 767 (1st Cir. 1992).
80 N. Plains Res. Council, Inc. v. Surface Transp. Bd., 668 F.3d 1067, 1079
(9th Cir. 2011) (quoting Selkirk Conservation All. v. Forsgren, 336 F.3d 944, 962
(9th Cir
ream emissions are a
reasonably foreseeable effect of an NGA 7 project.
79 EarthReports, Inc. v. FERC, 828 F.3d 949, 955 (D.C. Cir. 2016) (citations
omitted); see also Sierra Club v. Marsh, 976 F.2d 763, 767 (1st Cir. 1992).
80 N. Plains Res. Council, Inc. v. Surface Transp. Bd., 668 F.3d 1067, 1079
(9th Cir. 2011) (quoting Selkirk Conservation All. v. Forsgren, 336 F.3d 944, 962
(9th Cir. 2003)).
81 Id. at 1078.
82 Id. (quoting Envtl. Prot. Info. Ctr. v. U.S. Forest Serv., 451 F.3d 1005, 1014
(9th Cir. 2006)).
83 EarthReports, Inc. v. FERC, 828 F.3d at 955 (citing Sierra Club v. FERC, 827
F.3d 36, 47, 59, 68 (D.C. Cir. 2016) (Freeport).
Docket No. PL21-3-000
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a.
Direct Emissions
Several commenters assert that the Commission must consider fugitive emissions
from the transportation of gas.84 New Jersey Conservation Foundation, Sabin Center for
Climate Change Law (Sabin Center), The Watershed Institute, Clean Air Council,
PennFuture, and New Jersey League of Conservation Voters (collectively, New Jersey
Conservation Foundation) argue that natural gas leakage from both pipeline operation
and natural gas production is worse than combustion because methane has a higher global
warming potential than carbon dioxide.85
As the Commission has long held, direct GHG emissions from the project’s short-
term construction86 and long-term operational activities87 are an effect of the proposed
project. Under current Commission regulations, the project sponsor provides an estimate
of construction emissions and an estimate of the project’s potential operational emissions,
including fugitive emissions from both pipeline and aboveground facilities, in its
application for Commission authorization.88
84 See, e.g., Egan Millard 2021 Comments at 3; New Jersey Conservation
Foundation 2021 Comments at 21; Shayna Gleason 2021 Comments at 2.
85 New Jersey Conservation Foundation 2021 Comments at 21
ns and an estimate of the project’s potential operational emissions,
including fugitive emissions from both pipeline and aboveground facilities, in its
application for Commission authorization.88
84 See, e.g., Egan Millard 2021 Comments at 3; New Jersey Conservation
Foundation 2021 Comments at 21; Shayna Gleason 2021 Comments at 2.
85 New Jersey Conservation Foundation 2021 Comments at 21.
86 Construction emissions include emissions from gasoline- and diesel-powered
construction equipment.
87 Operational emissions include emissions from combustion units at compressor
stations and fugitive leaks from compressor stations, meter/valve stations, and the
pipeline.
88 The project sponsor provides emissions information in Resource Report No. 9.
18 CFR 380.12(k). Operational emissions are also estimated in the project’s air permit
Docket No. PL21-3-000
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b.
Downstream Emissions
Some commenters argue that the Commission must consider the downstream
emissions of natural gas projects,89 including fugitive emissions.90 In contrast, other
commenters generally assert that the Commission should not consider downstream
emissions, or at most, should only do a qualitative assessment of downstream emissions,
because they are not reasonably foreseeable impacts or do not have a close causal
relationship under NEPA to gas transportation.91
application, which is typically submitted to the state agency with delegated Clean Air Act
authority. Further, the Commission’s guidance manual for NGA certificate applications
instructs project sponsors to provide the GHGs in tons per year for the construction and
operation of the proposed project. See Guidance Manual for Environmental Report
Preparation for Applications Filed under the NGA, Volume I, at 4-123, 4-125 to 4-127
(Guidance Manual)
agency with delegated Clean Air Act
authority. Further, the Commission’s guidance manual for NGA certificate applications
instructs project sponsors to provide the GHGs in tons per year for the construction and
operation of the proposed project. See Guidance Manual for Environmental Report
Preparation for Applications Filed under the NGA, Volume I, at 4-123, 4-125 to 4-127
(Guidance Manual).
89 See, e.g., Food and Water Watch 2021 Comments at 1; New Jersey
Conservation Foundation 2021 Comments at 19; Attorneys General of Massachusetts,
Illinois, Maryland, New Jersey, Rhode Island, Washington, and the District of Columbia
(Attorneys General of Massachusetts et al.) 2018 Comments at 12-17.
90 For example, the Massachusetts PipeLine Awareness Network states that the
Commission should consider fugitive emissions from the distribution and burning of
transported gas. Massachusetts PipeLine Awareness Network 2021 Comments at 2; see
also, e.g., Egan Millard 2021 Comments at 3; Shayna Gleason 2021 Comments at 2.
91 See, e.g., American Petroleum Institute (API) Technical Conference Comments
at 3-5 (stating the Commission and developers cannot accurately forecast downstream
emissions due to lack of knowledge of the end use of the gas, variability in utilization
rates and regulatory requirements, and unpredictable changes in supply and demand,
among other factors); Boardwalk Pipeline Partners LP (Boardwalk) Technical
Conference Comments at 21; Enbridge Gas Pipelines (Enbridge) Technical Conference
Comments at 11, 25-26; Interstate Natural Gas Association of America (INGAA) 2021
Comments at 58-60; The Williams Companies, Inc. (Williams) 2021 Comments at 37-38;
Natural Gas Supply Association (NGSA) 2018 Comments at 15-16.
nd demand,
among other factors); Boardwalk Pipeline Partners LP (Boardwalk) Technical
Conference Comments at 21; Enbridge Gas Pipelines (Enbridge) Technical Conference
Comments at 11, 25-26; Interstate Natural Gas Association of America (INGAA) 2021
Comments at 58-60; The Williams Companies, Inc. (Williams) 2021 Comments at 37-38;
Natural Gas Supply Association (NGSA) 2018 Comments at 15-16.
Docket No. PL21-3-000
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As discussed above, in August 2017, the D.C. Circuit issued Sabal Trail, which
involved a greenfield pipeline project that would deliver all gas transported by the project
to specific gas-fired generating plants. The D.C. Circuit found that downstream
emissions from the use of the transported natural gas were an indirect, reasonably
foreseeable effect of the proposed pipeline and that in the circumstances of that case—
where the vast majority of throughput on the proposed project was destined for a limited
number of specifically identified electric generation facilities—the downstream GHG
emissions could be reasonably quantified by the Commission.92
The D.C. Circuit reiterated this determination in two subsequent cases. First, in
Birckhead, the court rejected the claim that downstream emissions are only a foreseeable
effect in factual circumstances akin to Sabal Trail, i.e., where all transported gas will be
burned at specifically identified destinations, but also rejected the argument that
downstream emissions are always a foreseeable effect of a natural gas certificate
project.93 Then, in Allegheny Defense Project v. FERC,94 the court stated that the
92 The court concluded “that the EIS for the Southeast Market Project should have
either given a quantitative estimate of the downstream greenhouse emissions that will
result from burning the natural gas that the pipelines will transport or explained more
specifically why it could not have done so.” Sabal Trail, 867 F.3d at 1374
Allegheny Defense Project v. FERC,94 the court stated that the
92 The court concluded “that the EIS for the Southeast Market Project should have
either given a quantitative estimate of the downstream greenhouse emissions that will
result from burning the natural gas that the pipelines will transport or explained more
specifically why it could not have done so.” Sabal Trail, 867 F.3d at 1374.
93 Birckhead, 925 F.3d at 518-20 (criticizing the Commission for not attempting to
obtain data on downstream uses).
94 932 F.3d 940 (D.C. Cir. 2019).
Docket No. PL21-3-000
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downstream emissions of a project designed to deliver gas into large interstate pipeline
systems, which in turn deliver gas to 16 states, are an indirect effect of the project.95
INGAA and others read the Supreme Court’s Public Citizen decision as requiring
an agency to consider an environmental effect only when the agency has the authority to
control the outcome and note that the Commission has no authority to regulate the end
use (or production) of natural gas.96 INGAA states that attempting to regulate
downstream (or upstream) activities would invade the jurisdiction of other regulators, that
most projects will not result in reasonably foreseeable downstream GHG emissions like
those in Sabal Trail, and thus, downstream emissions should only be considered on a
case-by-case basis.97 INGAA suggests the Commission look for guidance to Center for
Biological Diversity v. U.S. Army Corps of Engineers,98 which criticizes Sabal Trail as
“breezing past . . . statutory limits and precedents . . . clarifying what effects are
cognizable under NEPA.”99
95 Id. at 945-46.
96 See, e.g., INGAA 2021 Comments at 50-51
ream emissions should only be considered on a
case-by-case basis.97 INGAA suggests the Commission look for guidance to Center for
Biological Diversity v. U.S. Army Corps of Engineers,98 which criticizes Sabal Trail as
“breezing past . . . statutory limits and precedents . . . clarifying what effects are
cognizable under NEPA.”99
95 Id. at 945-46.
96 See, e.g., INGAA 2021 Comments at 50-51.
97 INGAA 2021 Comments at 49-51, 57; see also INGAA Technical Conference
Comments at 14 (adding that NEPA’s requirements would exclude downstream
emissions occurring after a “long and attenuated chain of intermediate causal factors, as
when natural gas is transported to an interconnect for further shipment on the interstate
grid, eventually reaching end-use consumers only through a long intermediate path”).
98 941 F.3d 1288 (11th Cir. 2019) (Center for Biological Diversity).
99 Id. at 1300 (citing Pub. Citizen, 541 U.S. 752 and Metro. Edison Co.,
460 U.S. 766).
Docket No. PL21-3-000
- 28 -
Given that data show that the vast majority of consumed gas is ultimately
combusted,100 there appears to be a substantial likelihood of GHG emissions from the
end-use combustion of transported gas as a result of a natural gas project proposed under
NGA section 7.101 However, as contemplated by the court in Birckhead, there may be
circumstances where downstream emissions are not a foreseeable effect of an authorized
project, and the court stated that each project must be analyzed on a case-by-case basis.102
Accordingly, project sponsors may submit any evidence they believe indicates that
downstream emissions are not a reasonably foreseeable effect of a proposed project.
We disagree with commenters’ assertions that Public Citizen prohibits the
Commission from considering downstream GHG emissions. The question is not whether
the Commission has regulatory authority over downstream emissions
02
Accordingly, project sponsors may submit any evidence they believe indicates that
downstream emissions are not a reasonably foreseeable effect of a proposed project.
We disagree with commenters’ assertions that Public Citizen prohibits the
Commission from considering downstream GHG emissions. The question is not whether
the Commission has regulatory authority over downstream emissions. Rather, as the
Sabal Trail court reasoned in applying Public Citizen, the Commission “has no obligation
to gather or consider environmental information [only] if it has no statutory authority to
100 U.S. Energy Info. Admin., December 2021 Monthly Energy Review 24, 101
(2021) (reporting that, in 2020, 1,036 Bcf of natural gas had a non-combustion use
compared to 30,476 Bcf of total consumption),
https://www.eia.gov/totalenergy/data/monthly/pdf/mer.pdf; see also Jayni Hein et al.,
Institute for Policy Integrity, Pipeline Approvals and Greenhouse Gas Emissions 25
(2019) (explaining that, in 2017, 97% of all natural gas consumed was combusted).
101 See Birckhead, 925 F.3d at 518; Sabal Trail, 867 F.3d at 1371-72.
102 Birckhead, 925 F.3d at 518-19 (rejecting, in dicta, that downstream emissions
are always a foreseeable effect of a proposed certificate project).
Docket No. PL21-3-000
- 29 -
act on that information.”103 Because the Commission can reject a section 7 certificate
based on the project’s environmental impacts, including GHG emissions, the court held
that the Commission was required to consider downstream emissions resulting from the
Sabal Trail project’s construction.104 For section 7 projects—unlike section 3 projects,
described below—there is no independent decision, such as the DOE authorization
critical in Freeport, to “break the NEPA causal” chain.105 Accordingly, the
Commission’s authorization for section 7 projects is a “legally relevant cause” of the
emissions, meeting Public Citizen’s direction that “NEPA requires ‘a reasonably close
causal relationship’ between the environm
ike section 3 projects,
described below—there is no independent decision, such as the DOE authorization
critical in Freeport, to “break the NEPA causal” chain.105 Accordingly, the
Commission’s authorization for section 7 projects is a “legally relevant cause” of the
emissions, meeting Public Citizen’s direction that “NEPA requires ‘a reasonably close
causal relationship’ between the environmental effect and the alleged cause,” analogous
to the “familiar doctrine of proximate cause from tort law.”106
The Commission finds this and subsequent direction from the D.C. Circuit more
instructive than Center for Biological Diversity, which determined that a specific effect
was too tenuous to be considered in analysis of a U.S. Army Corps of Engineers
discharge permit for mining activities under the Clean Water Act.107
103 Sabal Trail, 867 F.3d at 1372-73 (emphasis in original) (explaining Pub.
Citizen, 541 U.S. 752).
104 See id. at 1373 (“Because FERC could deny a pipeline certificate on the ground
that the pipeline would be too harmful to the environment, the agency is a ‘legally
relevant cause’ of the direct and indirect environmental effects of pipelines it approves.”
(quoting Freeport, 827 F.3d at 47).
105 Freeport, 827 F.3d at 47.
106 Pub. Citizen, 541 U.S. at 767 (quoting Metro. Edison Co., 460 U.S. at 774).
107 See Center for Biological Diversity, 941 F.3d at 1292 (describing whether the
U.S. Army Corps of Engineers legally declined to address, in issuing discharge permits
’ of the direct and indirect environmental effects of pipelines it approves.”
(quoting Freeport, 827 F.3d at 47).
105 Freeport, 827 F.3d at 47.
106 Pub. Citizen, 541 U.S. at 767 (quoting Metro. Edison Co., 460 U.S. at 774).
107 See Center for Biological Diversity, 941 F.3d at 1292 (describing whether the
U.S. Army Corps of Engineers legally declined to address, in issuing discharge permits
Docket No. PL21-3-000
- 30 -
However, for proposed export projects under NGA section 3, the Commission will
not consider downstream GHG emissions an effect requiring analysis under NEPA
regulations. The Department of Energy, not the Commission, has sole authority to
license and consider the environmental impacts of the export of any natural gas.108 As
courts have explained, the Commission need not consider the effects of downstream
transportation, consumption, or combustion of exported gas because the Department of
Energy’s “independent decision to allow exports . . . breaks the NEPA causal chain and
absolves the Commission of responsibility to include [these considerations] in its NEPA
analysis.”109
for phosphate mining, the effects of a radioactive byproduct of fertilizer production
(phosphogypsum), where the phosphogypsum is neither a byproduct of dredging and
filling or phosphate mining or beneficiation). The court criticized the reasoning in Sabal
Trail but also observed that the “causal relationship between the agency action and the
putative downstream effect was much closer [in Sabal Trail] than it is here” and that the
Commission’s scope of statutory authority is “much broader” than that of the U.S. Army
Corps of Engineers. Id. at 1299-1300
filling or phosphate mining or beneficiation). The court criticized the reasoning in Sabal
Trail but also observed that the “causal relationship between the agency action and the
putative downstream effect was much closer [in Sabal Trail] than it is here” and that the
Commission’s scope of statutory authority is “much broader” than that of the U.S. Army
Corps of Engineers. Id. at 1299-1300.
108 Freeport, 827 F.3d at 47 (holding that the Commission does not have to
address the indirect effects of the anticipated export of natural gas because the
Department of Energy, not the Commission, has sole authority to license and consider the
environmental impacts of the export of any natural gas going through LNG facilities);
Freeport, 827 F.3d at 62-63 (same); EarthReports, Inc. v. FERC, 828 F.3d at 956 (same);
Sabal Trail, 867 F.3d at 1372 (explaining Freeport).
109 Freeport, 827 F.3d at 48.
Docket No. PL21-3-000
- 31 -
c.
Upstream Emissions
Some commenters state that the Commission must consider the upstream GHG
emissions of natural gas projects, including fugitive emissions from production,110 to
assess the project’s total impact on climate change.111 Other commenters argue that
upstream emissions are not a reasonably foreseeable effect of a natural gas transportation
project, and therefore should not be considered by the Commission.112 Some
commenters focus on how to obtain sufficient information to account for upstream GHG
emissions. For example, EPA recommends that the Commission require project sponsors
to provide available information on reasonably foreseeable induced production demand
t a reasonably foreseeable effect of a natural gas transportation
project, and therefore should not be considered by the Commission.112 Some
commenters focus on how to obtain sufficient information to account for upstream GHG
emissions. For example, EPA recommends that the Commission require project sponsors
to provide available information on reasonably foreseeable induced production demand.
EPA states that environmental documents under NEPA should disclose this information
as well as items such as the proposal’s regionally known hydrocarbon accumulations and
a decline curve analysis to allow for appropriate regional and local impact analysis.113
In various NGA section 7 proceedings, the Commission has considered upstream
emissions on a case-by-case basis—sometimes acknowledging it is difficult to quantify
110 See, e.g., Egan Millard 2021 Comments at 3; Shayna Gleason 2021 Comments
at 2.
111 See, e.g., Institute for Policy Integrity at New York University School of Law
(Policy Integrity) Technical Conference Comments at 17; Food and Water Watch 2021
Comments at 1; New Jersey Conservation Foundation 2021 Comments at 19.
112 See, e.g., Boardwalk Technical Conference Comments at 21; Enbridge
Technical Conference Comments at 11, 25-26; TC Energy Corporation (TC Energy)
Technical Conference Comments at 5; Williams Technical Conference Comments at 4;
INGAA 2021 Comments at 56-57; Williams 2021 Comments at 37-38.
113 EPA 2021 Comments at 5.
1
Comments at 1; New Jersey Conservation Foundation 2021 Comments at 19.
112 See, e.g., Boardwalk Technical Conference Comments at 21; Enbridge
Technical Conference Comments at 11, 25-26; TC Energy Corporation (TC Energy)
Technical Conference Comments at 5; Williams Technical Conference Comments at 4;
INGAA 2021 Comments at 56-57; Williams 2021 Comments at 37-38.
113 EPA 2021 Comments at 5.
Docket No. PL21-3-000
- 32 -
upstream emissions due to several unknown factors, including the location of the supply
source and whether transported gas will come from new or existing production.114 The
Commission will continue to consider on a case-by-case basis whether the environmental
effects resulting from natural gas production are either likely caused by a proposed NGA
section 7 project or reasonably foreseeable consequences of our approval of such
projects. To the extent known, project sponsors are encouraged to submit information on
the reasonably foreseeable upstream impacts caused by the project or an explanation as to
why there are none for Commission consideration.
2.
Calculating GHG Emissions
To calculate operational emissions, project sponsors should continue to follow the
existing guidance outlined in section 4.9.1.3 of the Commission’s Guidance Manual for
Environmental Report Preparation for Applications Filed under the NGA.115 However,
under this policy statement, for purposes of assessing the impact of a project’s GHG
114 See Birckhead, 925 F.3d at 516-18. See, e.g., Double E Pipeline, LLC, 173
FERC ¶ 61,074, at P 97 (2020); Cent. N.Y. Oil & Gas Co., LLC, 137 FERC ¶ 61,121, at
PP 81-101 (2011), order on reh’g, 138 FERC ¶ 61,104, at PP 33-49 (2012), petition for
review dismissed sub nom., Coal. for Responsible Growth v. FERC, 485 F.App’x 472,
474-75 (2d Cir. 2012) (unpublished opinion); see also Adelphia Gateway, LLC, 169
FERC ¶ 61,220, at P 243 (2019), order on reh’g, 171 FERC ¶ 61,049, at P 89 (2020)
P 97 (2020); Cent. N.Y. Oil & Gas Co., LLC, 137 FERC ¶ 61,121, at
PP 81-101 (2011), order on reh’g, 138 FERC ¶ 61,104, at PP 33-49 (2012), petition for
review dismissed sub nom., Coal. for Responsible Growth v. FERC, 485 F.App’x 472,
474-75 (2d Cir. 2012) (unpublished opinion); see also Adelphia Gateway, LLC, 169
FERC ¶ 61,220, at P 243 (2019), order on reh’g, 171 FERC ¶ 61,049, at P 89 (2020).
115 We note that thresholds for Clean Air Act and state air permits are typically
based on the regulated source’s potential to emit, or the maximum capacity of a
stationary source to emit any air pollutant under its physical and operational design,
rather than its actual emissions, and that air permits themselves are expressed in potential
to emit. See 40 CFR 70.2. This policy statement does not apply to any other air
pollutants than GHGs. For all other air pollutants, we will continue to evaluate a
project’s air quality impacts based on its potential to emit.
Docket No. PL21-3-000
- 33 -
emissions on climate change, the Commission will consider operational GHG emissions
calculated based on a projected utilization rate for the project, as described below.116
Additionally, the Commission recognizes that there may be other factors that
might serve to reduce a proposed project’s climate impacts. For example, the installation
of emission-reduction technology or purchase of offsets by downstream users would
reduce the impacts. Thus, to enable the Commission’s use of the best estimate of a
project’s GHG emissions, project sponsors are encouraged to calculate project GHG
emissions using a projected utilization rate and submit evidence of any other factors that
might impact a project’s net emissions such as the factors identified by commenters
below
or purchase of offsets by downstream users would
reduce the impacts. Thus, to enable the Commission’s use of the best estimate of a
project’s GHG emissions, project sponsors are encouraged to calculate project GHG
emissions using a projected utilization rate and submit evidence of any other factors that
might impact a project’s net emissions such as the factors identified by commenters
below.
Commenters recommend that the Commission consider factors that might impact a
project’s net emissions, such as (1) whether the transported gas will phase out use of a
more carbon-intensive energy source, like coal or fuel oil, and will prevent the use of
more carbon-intensive energy sources in the future; (2) whether the pipeline will
transport gas that would otherwise be transported by vehicles, thereby reducing the
emissions from transporting the gas; (3) whether the proposed project will transport gas
volumes that would have otherwise been delivered to the same consumers through a
different pipeline or may ultimately end up transporting fuel blends including renewable
natural gas or hydrogen; (4) whether the project sponsor will purchase offsets to counter
project emissions; or (5) whether the project may be backed by a local distribution
116 See infra section III.A.2.a.
Docket No. PL21-3-000
- 34 -
company serving customer demand in states with established emissions caps.117 INGAA
states that in the absence of reliable and verifiable predictive models to the contrary, the
requirement of reasonable foreseeability arguably dictates that the Commission cannot
adopt any default assumption that a natural gas infrastructure project will increase (rather
than decrease, or leave unchanged) net global GHG emissions, and that at minimum, the
Commission would have to provide a rational justification for any such assumption.118
By contrast, New Jersey Conservation Foundation and others contend that the
117 See, e.g., American Gas Association (AGA) Technical Conference Comments
at 28, 40; API Te
l gas infrastructure project will increase (rather
than decrease, or leave unchanged) net global GHG emissions, and that at minimum, the
Commission would have to provide a rational justification for any such assumption.118
By contrast, New Jersey Conservation Foundation and others contend that the
117 See, e.g., American Gas Association (AGA) Technical Conference Comments
at 28, 40; API Technical Conference Comments at 3; Boardwalk Technical Conference
Comments at 23 (stating that the Commission should rely on local distribution
companies’ air permits to determine GHG emissions); Enbridge Technical Conference
Comments at 31-34; Hon. Joseph T. Kelliher Technical Conference Comments at 5-6
(Commissioner Kelliher, Principal at Three Acorns, was a panelist at the GHG Technical
Conference on Panel 1.); INGAA Technical Conference Comments at 17-18 (suggesting
the net emissions analysis must be undertaken on a global level); Kinder Morgan Entities
(Kinder Morgan) Technical Conference Comments at 12-15; National Grid Gas
Companies Technical Conference Comments at 3-7 (describing the Distributed
Infrastructure Solution that it has developed in coordination with the State of New York);
Williams Technical Conference Comments at 7-8; Charles River Associates 2021
Comments at 4-5; Ohio Environmental Council 2021 Comments at 3. See Environmental
Assessment for the Iroquois Gas Transmission System, L.P. (Iroquois) Enhancement by
Compression Project, Docket No. CP20-48-000, at B-110 (Sept. 30, 2020) (citing
Iroquois’ end-use GHG analysis that projected greater GHG emissions if the project was
not built under scenarios where the energy needs of all new buildings are met by fuel oil
as opposed to gas supplied by the project). One industrial end user expresses concern
about the potential of integrating renewable natural gas due to concerns about pipeline
integrity or increased costs
2020) (citing
Iroquois’ end-use GHG analysis that projected greater GHG emissions if the project was
not built under scenarios where the energy needs of all new buildings are met by fuel oil
as opposed to gas supplied by the project). One industrial end user expresses concern
about the potential of integrating renewable natural gas due to concerns about pipeline
integrity or increased costs. American Forest and Paper Association and Process Gas
Consumers Group (collectively, American Forest) Technical Conference Comments at
13-14.
118 INGAA Technical Conference Comments at 19.
Docket No. PL21-3-000
- 35 -
Commission should consider whether the project may be displacing renewable energy
sources, thereby increasing GHG emissions.119
INGAA and other commenters strongly urge the Commission to calculate a
project’s downstream emissions, if at all, based on the likely utilization rate of the
proposed project, instead of relying on a full-burn estimate.120
Conversely, New Jersey Conservation Foundation and others argue the
Commission must calculate direct, downstream, and upstream GHG emissions by
assuming the maximum authorized operating conditions, unless, some add, the project
sponsor can demonstrate otherwise.121 Further, other commenters propose their own
119 See, e.g., New Jersey Conservation Foundation 2021 Comments at 23.
120 See, e.g., Enbridge Technical Conference Comments at 12, 29-30; Hon. Joseph
T
mmission must calculate direct, downstream, and upstream GHG emissions by
assuming the maximum authorized operating conditions, unless, some add, the project
sponsor can demonstrate otherwise.121 Further, other commenters propose their own
119 See, e.g., New Jersey Conservation Foundation 2021 Comments at 23.
120 See, e.g., Enbridge Technical Conference Comments at 12, 29-30; Hon. Joseph
T. Kelliher Technical Conference Comments at 5-6; INGAA Technical Conference
Comments at 15-16 (describing an analysis it commissioned concluding that in 2020, the
maximum utilization on an average annual basis for any of the pipeline “corridors”
between different regions is not higher than 65% and it is over 50% only for 7 of the 30
regional corridors); TC Energy Technical Conference Comments at 18; Charles River
Associates 2021 Comments at 6; INGAA 2021 Comments at 58; see also Boardwalk
Technical Conference Comments at 3, 23; Williams Technical Conference Comments at
7. API, on the other hand, asserts that use of utilization estimates or emissions data
forces the Commission to pick winners among competing pipeline projects and asserts
that such decisions are best made by market forces after the Commission authorizes a
project. API Technical Conference Comments at 3-4.
121 See, e.g., New Jersey Conservation Foundation 2021 Comments at 21-22;
Public Interest Organizations 2018 Comments at 91; Washington State Department of
Commerce and Washington State Department of Ecology 2018 Comments at 6. Public
Interest Organizations’ 2018 comments represent 63 entities including Natural Resources
Defense Council.
project. API Technical Conference Comments at 3-4.
121 See, e.g., New Jersey Conservation Foundation 2021 Comments at 21-22;
Public Interest Organizations 2018 Comments at 91; Washington State Department of
Commerce and Washington State Department of Ecology 2018 Comments at 6. Public
Interest Organizations’ 2018 comments represent 63 entities including Natural Resources
Defense Council.
Docket No. PL21-3-000
- 36 -
methods of how to calculate the downstream emissions of a proposed project.122 New
Jersey Conservation Foundation urges the Commission to recommend or require the use
of specified emissions factors to calculate project emissions.123 Some commenters argue
that the Commission must, beyond asking project sponsors, require certain information to
be provided, conduct independent research, or otherwise compile missing information.124
Dr. Susan F. Tierney states that the Commission should articulate a default methodology,
set of assumptions, and sources of data (suggesting multiple sources including data from
the U.S. Department of Energy’s National Energy Technology Laboratory’s 2019 life-
cycle estimates of GHG emissions for the natural gas supply chain) to establish a default
maximum emissions rate, which could then be supplemented by an applicant’s own
estimate or an intervenor’s alternative estimate.125
122 See, e.g., Charles River Associates 2021 Comments at 6-8 (proposing a
regional analysis to estimate downstream emissions of a gas project).
123 New Jersey Conservation Foundation 2021 Comments at 22.
124 See, e.g., Berkshire Environmental Action Team 2021 Comments at 3; North
Carolina Department of Environmental Quality 2018 Comments at 5-8.
125 Dr. Susan F. Tierney, Senior Advisor with the Analysis Group, Inc., was a
panelist at the GHG Technical Conference on Panel 1. Dr. Susan F. Tierney Technical
Conference Statement at 4-10. The applicant could supplement its estimate with an
alternative estimate, and intervenors could also submit estimates.
s at 3; North
Carolina Department of Environmental Quality 2018 Comments at 5-8.
125 Dr. Susan F. Tierney, Senior Advisor with the Analysis Group, Inc., was a
panelist at the GHG Technical Conference on Panel 1. Dr. Susan F. Tierney Technical
Conference Statement at 4-10. The applicant could supplement its estimate with an
alternative estimate, and intervenors could also submit estimates.
Docket No. PL21-3-000
- 37 -
a.
Projected Utilization Rate
In previous environmental documents and certificate orders, the Commission has
disclosed a project’s operational emissions126 and estimates of downstream emissions127
by assuming a 100% utilization rate estimate of the project (e.g., the maximum capacity
is transported 365 days per year, 24 hours a day and fully combusted downstream). This
represents the maximum potential downstream GHG emissions. However, most projects
do not operate at 100% utilization at all times. In fact, many projects are designed to
address peak demand. For example, traditionally, in the Northeast, demand for gas is
highest in the winter months, resulting in high utilization rates during those months due
to heating needs, but lower in the summer, resulting in low annual utilization rates.128
Because in most instances a 100% utilization rate estimate does not accurately
capture the project’s climate impacts, estimated emissions that reflect a projected
utilization rate will provide more useful information. The project’s projected utilization
rate may be calculated using, for example:
126 See Environmental Assessment for the Lake City 1st Branch Line
Abandonment and Capacity Replacement Project, Docket No. CP20-504-000, at 51-53
(Feb. 2021); see also 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).
127 See Atl
ne
Abandonment and Capacity Replacement Project, Docket No. CP20-504-000, at 51-53
(Feb. 2021); see also 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).
127 See Atl. Coast Pipeline, LLC, 161 FERC ¶ 61,042 at P 305.
128 Some commenters point out that daily pipeline load factors vary significantly
based on seasonal trends. See, e.g., Charles River Associates 2021 Comments at 3;
Williams 2021 Comments at 46.
Docket No. PL21-3-000
- 38 -
• Expected utilization data from project shippers;
• Historical usage data;129
• Demand projections;
• An estimate of how much capacity will be used on an interruptible basis.
The project sponsor is encouraged to file its projected utilization rate, as well as its
justification for the rate and any supporting evidence, in its application for authorization
under NGA section 3 or 7. The Commission will also consider evidence submitted by
commenters and protesters in support of or opposition to the projected utilization rate.
b.
Other Evidence Considered
Further, the Commission will consider any other evidence in the record that
impacts the quantification of the project’s reasonably foreseeable emissions. For
example, the Commission will consider: evidence of a net-reduction in GHG emissions
where the use of transported gas displaces the use of a higher emitting alternative fuel;130
evidence of anticipated changes in downstream usage rates over time; evidence of any
real, verifiable, and measurable reduction efforts taken by the pipeline or downstream
129 We note that for a greenfield pipeline project, historic data will not be
available. In those cases, the project sponsor could use data from other similar projects
or regional data
igher emitting alternative fuel;130
evidence of anticipated changes in downstream usage rates over time; evidence of any
real, verifiable, and measurable reduction efforts taken by the pipeline or downstream
129 We note that for a greenfield pipeline project, historic data will not be
available. In those cases, the project sponsor could use data from other similar projects
or regional data.
130 For instance, in a downstream end-use analysis, Iroquois projected that its
Enhancement by Compression project could result in net GHG reductions when
considering the alternative fuel that may be used (e.g., fuel oil for heating) by the end use
customer in the event that gas is not available. Iroquois Gas Transmission, LP,
Downstream GHG Report, Docket No. CP20-48-000 (filed May 19, 2020).
Docket No. PL21-3-000
- 39 -
users to reduce their GHG emissions or offset their impacts;131 and evidence that a
project would displace zero-emissions electric generation. Further, other agencies,
notably the EPA, have proposed regulations that may impact the emission of methane
from Commission-regulated facilities.132 If such regulations are adopted, the
Commission will consider them when examining project GHG emissions. Similarly, the
Commission will consider evidence from commenters and protestors supporting or
challenging such estimates and assumptions.
B.
Level of Review and Significance
Under NEPA, an agency must prepare an EIS for every “major [f]ederal action[ ]
significantly affecting the quality of the human environment.”133 To determine whether
an EIS is necessary for a particular action, the agency may prepare an EA,134 described as
131 For example, the Commission may consider evidence that a downstream user
purchases credits to offset its GHG emissions from the consumption of transported gas.
The Commission will consider downstream user’s mitigation measures according to the
criteria outlined in infra section III.C.3 for applicant-proposed mitigation measures
cular action, the agency may prepare an EA,134 described as
131 For example, the Commission may consider evidence that a downstream user
purchases credits to offset its GHG emissions from the consumption of transported gas.
The Commission will consider downstream user’s mitigation measures according to the
criteria outlined in infra section III.C.3 for applicant-proposed mitigation measures. With
regards to construction and operational emissions, project sponsors should continue to
provide evidence of measures that minimize emissions, such as using low-sulfur diesel
fuel and limiting equipment idling during construction, as outlined in the Guidance
Manual. Guidance Manual at 4-124. However, as described supra section III.A.2.a,
operational emissions should now be calculated based on the project’s projected
utilization rate.
132 See, e.g., Standards of Performance for New, Reconstructed, and Modified
Sources and Emissions Guidelines for Existing Sources: Oil and Natural Gas Sector
Climate Review, 86 FR 63,110 (Nov. 15, 2020).
133 42 U.S.C. 4332(C); 40 CFR 1502.3.
134 40 CFR 1501.5, 1508.1(h).
Docket No. PL21-3-000
- 40 -
a “concise public document” providing “sufficient evidence and analysis,” to determine
whether to prepare an EIS or issue a finding of no significant impact.135
To assess significance, the Commission determines whether the impact “would
result in a substantial adverse change in the physical environment,”136 which, as
discussed, is based on considerations of the severity of adverse environmental impacts.
In making that determination, the Commission uses its experience, judgment, and
expertise to give record evidence appropriate weight.137 The Commission found that
135 See 40 CFR 1501.3, 1501.5, 1501.6, 1508.1(h), (l)
ould
result in a substantial adverse change in the physical environment,”136 which, as
discussed, is based on considerations of the severity of adverse environmental impacts.
In making that determination, the Commission uses its experience, judgment, and
expertise to give record evidence appropriate weight.137 The Commission found that
135 See 40 CFR 1501.3, 1501.5, 1501.6, 1508.1(h), (l).
136 See Magnum Gas Storage, LLC, 134 FERC ¶ 61,197 at P 114 (“[A]n impact
was considered to be significant if it would result in a substantial adverse change in the
physical environment or natural condition and could not be mitigated to less-than-
significant level.”).
137 For example, for an impact where there are no established federal standards, the
Commission makes qualitative assessments to determine whether a proposed project
would have a significant impact on a particular resource. See, e.g., Tex. LNG Brownsville
LLC, 169 FERC ¶ 61,130 at P 56 (“Due to the relatively undeveloped nature of the
project area, the visual sensitivity of nearby recreation areas, and the lack of feasible
visual screening measures, the Final EIS concluded that the project would result in a
significant impact on visual resources when viewed from the adjacent Laguna Atascosa
National Wildlife Refuge.”); Alaska Gasline Dev. Corp., 171 FERC ¶ 61,134, at PP 25,
89 (describing how the final EIS for the Alaska LNG Project found that construction and
operation of the project would have significant impacts on resources such as permafrost,
wetlands, forests, and caribou, but less than significant impacts on resources such as
scrub and herbaceous plant communities), order on reh’g, 172 FERC ¶ 61,214 (2020);
Transcon. Gas Pipe Line Co., LLC, 158 FERC ¶ 61,125 at P 79 (describing how the final
EIS for the Atlantic Sunrise Project concluded that the project would result in adverse
impacts that would be mitigated to less than significant levels).
sts, and caribou, but less than significant impacts on resources such as
scrub and herbaceous plant communities), order on reh’g, 172 FERC ¶ 61,214 (2020);
Transcon. Gas Pipe Line Co., LLC, 158 FERC ¶ 61,125 at P 79 (describing how the final
EIS for the Atlantic Sunrise Project concluded that the project would result in adverse
impacts that would be mitigated to less than significant levels).
Docket No. PL21-3-000
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“there is nothing about GHG emissions or their resulting contribution to climate change
that prevents us from making that same type of significance determination.”138
Specifically, in Northern Natural Gas Co., the Commission explained that:
The U.S. Court of Appeals for the District of Columbia Circuit has explained
that a proposed interstate natural gas pipeline’s reasonably foreseeable GHG
emissions are relevant to whether the pipeline is required by the public
convenience and necessity. A rigorous review of a project’s reasonably
foreseeable GHG emissions is also an essential part of the Commission’s
responsibility under NEPA to take a “hard look” at a project’s environmental
impacts. Determining the significance of the impacts from a proposed
project’s GHG emissions informs the Commission’s review in a number of
important respects, including its decision whether to prepare an
environmental impact statement.139
To date, no federal agency, including the Commission, has established a threshold
for determining what level of project-induced GHG emissions is significant. The
Commission received a number of comments, discussed below, offering perspectives on
whether and at what level it should assess the significance of a proposed project’s GHG
emissions.
1.
Comments
The Commission received relevant comments in response to both the 2018 and
2021 NOIs on whether the Commission should: determine significance at all; set a
specific significance threshold and at what level; and/or use various inventories, goals,
and tools to set the threshold.
138 N
and at what level it should assess the significance of a proposed project’s GHG
emissions.
1.
Comments
The Commission received relevant comments in response to both the 2018 and
2021 NOIs on whether the Commission should: determine significance at all; set a
specific significance threshold and at what level; and/or use various inventories, goals,
and tools to set the threshold.
138 N. Nat. Gas Co., 174 FERC ¶ 61,189 at P 32.
139 174 FERC ¶ 61,189 at P 30 (citations omitted).
Docket No. PL21-3-000
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a.
Whether the Commission Should Determine Significance
Numerous commenters (Delaware Riverkeeper, Food and Water Watch, North
Carolina Department of Environmental Quality, Sabin Center, and others) argue that the
Commission should make a significant impact determination based on a project’s GHG
emissions, which they argue would include the project’s associated upstream and
downstream emissions. Some commenters, for example the Sabin Center in 2018, direct
the Commission to the NEPA regulation at 40 CFR 1508.27 (that was removed by
amendments effective September 14, 2020), which provides that “significantly” as used
in NEPA requires considerations of both the context of the action and the intensity of the
impacts associated with any proposal.140
In contrast, some regulated entities and other commenters express concern about
the Commission determining the significance of a project’s impacts on the basis of GHG
emissions, especially upstream and downstream emissions. For example, INGAA and
others (Energy Infrastructure Council, Williams, etc.) argue that the Commission should,
at most, engage in a qualitative discussion of downstream GHG emissions because net
GHG emissions are not reasonably foreseeable, and that the Commission should not
assess the significance of upstream or downstream emissions.141 Commenters such as
140 See, e.g., Sabin Center 2018 Comments at 8-9.
141 See, e.g., INGAA 2021 Comments at 58-64
Williams, etc.) argue that the Commission should,
at most, engage in a qualitative discussion of downstream GHG emissions because net
GHG emissions are not reasonably foreseeable, and that the Commission should not
assess the significance of upstream or downstream emissions.141 Commenters such as
140 See, e.g., Sabin Center 2018 Comments at 8-9.
141 See, e.g., INGAA 2021 Comments at 58-64. INGAA’s 2021 comments update
its 2018 position that the Commission should not presume that all GHG emissions are
significant and should instead make a reasoned judgment whether: (1) a meaningful
assessment can be made with reasonable effort based upon available information and
(2) if so, whether a meaningful judgment can be formed regarding if the contribution of
Docket No. PL21-3-000
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Boardwalk state that the Commission cannot reject a project because of downstream
GHG emissions or consider upstream GHG emissions, may only include a general
disclosure of downstream emissions in limited circumstances (such as where all end use
is known), and should generally decline to assess significance and only engage in a
qualitative discussion.142
Commenters argue that the Commission lacks the ability to make a significance
determination and has no objective basis upon which to evaluate the impacts of GHG
emissions associated with any specific proposed project.143 Other commenters state that
setting any significance threshold would be arbitrary144 and potentially outside of the
Commission’s authority or jurisdiction.145
Finally, commenters state that the Commission should defer to other agencies,
such as CEQ or EPA, in setting a significance threshold, citing: the lack of a national
energy policy or federal GHG limits; the EPA’s existing authority to regulate GHG
emissions under the Clean Air Act; the direction of Executive Orders 13990 and 14008,
GHGs is likely to have a significant impact on the resource as a whole. INGAA 2018
Comments at 81-84
on should defer to other agencies,
such as CEQ or EPA, in setting a significance threshold, citing: the lack of a national
energy policy or federal GHG limits; the EPA’s existing authority to regulate GHG
emissions under the Clean Air Act; the direction of Executive Orders 13990 and 14008,
GHGs is likely to have a significant impact on the resource as a whole. INGAA 2018
Comments at 81-84.
142 Boardwalk 2021 Comments at 77-78, 86-90, 92-93. These comments are
generally echoed by the Energy Infrastructure Council. Energy Infrastructure Council
2021 Comments at 15-16, 22-27.
143 See, e.g., Enbridge 2021 Comments at 103.
144 See, e.g., U.S. Chamber of Commerce 2021 Comments at 9.
145 See, e.g., API 2021 Comments at 29-32; NGSA 2021 Comments at 21-22; TC
Energy 2021 Comments at 52-56; U.S. Chamber of Commerce 2021 Comments at 9.
Docket No. PL21-3-000
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which commenters say direct EPA to examine its own GHG emissions standards; and the
ongoing Interagency Work Group efforts on the SCC.146 A few industry commenters
also caution against creating uncertainty or a moving target for industry while waiting for
a significance threshold to be established.147
b.
What the Threshold Should Be
Some commenters argue that the Commission should consider any net increase in
GHG emissions as significant.148 Attorneys General of Massachusetts, Connecticut,
Maryland, Minnesota, New Jersey, New York, Oregon, Rhode Island, and the District of
Columbia (Attorneys General of Massachusetts et al.) argues that any investment in
pipeline infrastructure is inconsistent with new national emissions reductions targets and
thus, project emissions can be significant on that basis alone, even if they represent a
146 See, e.g., Cheniere Energy Inc. 2021 Comments at 14-16; Enbridge 2021
Comments at 104; Williams 2021 Comments at 35-38
rict of
Columbia (Attorneys General of Massachusetts et al.) argues that any investment in
pipeline infrastructure is inconsistent with new national emissions reductions targets and
thus, project emissions can be significant on that basis alone, even if they represent a
146 See, e.g., Cheniere Energy Inc. 2021 Comments at 14-16; Enbridge 2021
Comments at 104; Williams 2021 Comments at 35-38. Energy Transfer LP and the
NGSA also cite CEQ’s recent NEPA regulatory update and direction to agencies to
propose revisions to their NEPA procedures by September 14, 2023. Energy Transfer LP
2021 Comments at 14; NGSA 2021 Comments at 19-20. The Commission’s current
regulations provide that the Commission will comply with CEQ’s regulations except
where those regulations are inconsistent with the statutory requirements of the
Commission. 18 CFR 380.1. Therefore, any action taken by the Commission in a future
rulemaking pursuant to CEQ’s regulatory update does not prevent the Commission from
issuing this policy statement.
147 See, e.g., BHE Pipeline Group 2021 Comments at 8-10; Cheniere Energy Inc.
2021 Comments at 17-18.
148 Ohio Environmental Council 2021 Comments at 3.
Docket No. PL21-3-000
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small share of national emissions, or that emissions are significant if they impede the
ability of a state to meet its clean energy goals.149
A few commenters suggest specific numerical thresholds
ement.
147 See, e.g., BHE Pipeline Group 2021 Comments at 8-10; Cheniere Energy Inc.
2021 Comments at 17-18.
148 Ohio Environmental Council 2021 Comments at 3.
Docket No. PL21-3-000
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small share of national emissions, or that emissions are significant if they impede the
ability of a state to meet its clean energy goals.149
A few commenters suggest specific numerical thresholds. The Sabin Center
recommends that the Commission assess the magnitude of GHG emissions impacts using
EPA’s quantification threshold of 25,000 tons per year of CO2e to identify major emitters
under the Clean Air Act, social cost of GHG tools to assign a dollar value to the potential
impacts of the emissions, and EPA’s GHG Equivalencies Calculator as a comparison
tool.150 One commenter cites to EIS examples where the Commission stated that
monetized benefits of $8 million and $28 million would be “significant” for local
economies and suggests that gross climate damages between roughly $8 and $20 million
should be considered significant.151
Conversely, a few commenters state that emissions from all individual projects
could be considered de minimis and individually too small to impact climate change.152
Others urge the Commission away from taking a bright line approach to determining
149 Attorneys General of Massachusetts et al. 2021 Comments at 6-11. The 2021
commenters are made up of a slightly different group of state attorneys general than those
filing comments in 2018.
150 Sabin Center 2018 Comments at 8-9.
151 Environmental Defense Fund, Food & Water Watch, Policy Integrity, Montana
Environmental Information Center, Natural Resources Defense Council, Sierra Club,
Union of Concerned Scientists, and Western Environmental Law Center (EDF) 2021
Comments at 14-15.
152 See, e.g., Competitive Enterprise Institute 2021 Comments at 4, 6.
filing comments in 2018.
150 Sabin Center 2018 Comments at 8-9.
151 Environmental Defense Fund, Food & Water Watch, Policy Integrity, Montana
Environmental Information Center, Natural Resources Defense Council, Sierra Club,
Union of Concerned Scientists, and Western Environmental Law Center (EDF) 2021
Comments at 14-15.
152 See, e.g., Competitive Enterprise Institute 2021 Comments at 4, 6.
Docket No. PL21-3-000
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significance,153 while Driftwood Pipeline LLC urges that significance, if appropriate,
requires the Commission to disclose a clear threshold.154
CEQ points the Commission to its 2016 guidance as an existing resource to help
agencies assess GHG emissions and the effects of climate change in NEPA reviews.155
c.
Use of Inventories, Climate Goals, Programmatic
Analyses, Etc. in Determining Significance
Some commenters recommend that the Commission use state, regional, and global
GHG reduction goals to provide context and/or define significance of GHG emissions.156
For example, Attorneys General of Massachusetts et al. comments that the Commission
already analyzes whether a proposed pipeline project is consistent with various energy
and climate policies and goals and that this can be used as a metric for evaluating
significance.157 Others argue that the Commission’s analysis of a proposed project’s
public benefits should weigh the effect of project GHG emissions on states’ and the
nation’s abilities to comply with climate and clean energy laws and policies, such as
153 See, e.g., Enbridge 2021 Comments at 108; Russo on Energy 2021 Comments
at 17-18.
154 Driftwood Pipeline LLC 2021 Comments at 3.
155 CEQ 2021 Comments at 1.
156 See, e.g., Delaware Riverkeeper Network & Berks Gas Truth 2021 Comments
at 62; Ron Schaaf and Deb Evans 2021 Comments at 8; California Public Utilities
Commission 2018 Comments at 11-12.
157 Attorneys General of Massachusetts et al. 2018 Comments at 17-20.
Comments at 108; Russo on Energy 2021 Comments
at 17-18.
154 Driftwood Pipeline LLC 2021 Comments at 3.
155 CEQ 2021 Comments at 1.
156 See, e.g., Delaware Riverkeeper Network & Berks Gas Truth 2021 Comments
at 62; Ron Schaaf and Deb Evans 2021 Comments at 8; California Public Utilities
Commission 2018 Comments at 11-12.
157 Attorneys General of Massachusetts et al. 2018 Comments at 17-20.
Docket No. PL21-3-000
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specific energy and climate change action plans and policies.158 The Ohio Environmental
Council recommends that the Commission consider the total proposed upstream and
downstream GHG emissions of all gas projects pending in any given year, giving weight
to the total possible GHG emissions that could be locked in by those projects and
comparing this total with international goals.159
Other commenters suggest alternative means or tools for assessing significance.
For example, commenters suggest that the Commission should use a “Climate Test.”160
Patricia Weber comments that the Commission should use such a test to determine if a
project is viable in a scenario where the climate goals of the Paris agreement are met
using climate and global energy market models. One commenter urges the Commission
to examine acres of wetlands that will be lost due to climate impacts of proposed projects
158 See, e.g., Attorneys General of Massachusetts et al. 2018 Comments at 17-20;
Franklin Governments 2018 Comments at 2.
159 Ohio Environment Council 2018 Comments at 12-13.
160 Natural Resources Defense Council (NRDC) also suggests the Commission use
its forthcoming “Climate Test,” which is a tool being developed by NRDC to quantify the
consistency of individual infrastructure projects with climate goals. NRDC 2021
Comments at 6. However, NRDC has not filed additional information on its “Climate
Test.”
2.
159 Ohio Environment Council 2018 Comments at 12-13.
160 Natural Resources Defense Council (NRDC) also suggests the Commission use
its forthcoming “Climate Test,” which is a tool being developed by NRDC to quantify the
consistency of individual infrastructure projects with climate goals. NRDC 2021
Comments at 6. However, NRDC has not filed additional information on its “Climate
Test.”
Docket No. PL21-3-000
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as a proxy for significance.161 Some commenters suggest the Commission consider a
programmatic or regional analysis of pipelines.162
EDF comments that a comparison of a project’s emissions to international, state,
or regional carbon budgets, or assessing geophysical impacts such as increases in carbon
dioxide levels, global temperatures, or sea levels can be misleading and trivialize the
project’s impacts.163
Some industry commenters state that any comparison of direct or indirect
emissions should be made to global GHG inventories, not national or state inventories.164
However, Williams states that, while the Commission should consider only direct
construction and operation emissions, the Commission should compare those emissions
against national GHG inventories and not against international agreements or regional
targets.165 Others oppose use of a regional analysis of GHG emissions from pipeline
projects.166
161 Healthy Gulf 2021 Comments at 14.
162 E.g., Attorneys General of Massachusetts et al. 2021 Comments at 8-11; EPA
2021 Comments at 1; Attorneys General of Massachusetts et al. 2018 Comments at 12-
17.
163 EDF 2021 Comments at 9-12, 16.
164 See, e.g., Boardwalk 2021 Comments at 82-83; NGSA 2021 Comments at 15.
Enbridge states that comparison to these inventories would be arbitrary, but that such an
approach could help contextualize the GHG emissions for the Commission and the
public. Enbridge 2021 Comments at 105, 108-109.
165 Williams 2021 Comments at 38.
166 See, e.g., Competitive Enterprise Institute 2021 Comments at 3-4.
See, e.g., Boardwalk 2021 Comments at 82-83; NGSA 2021 Comments at 15.
Enbridge states that comparison to these inventories would be arbitrary, but that such an
approach could help contextualize the GHG emissions for the Commission and the
public. Enbridge 2021 Comments at 105, 108-109.
165 Williams 2021 Comments at 38.
166 See, e.g., Competitive Enterprise Institute 2021 Comments at 3-4.
Docket No. PL21-3-000
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d.
Use of the Social Cost of Greenhouse Gases
Several commenters generally argue for a monetization of climate damages using
the Social Cost of Greenhouse Gas (SC-GHG) tools167 to determine significance.168 EDF
recommends that the approach should be consistent with the Commission’s practices for
determining the significance of other monetized effects, such as economic impacts.169
Public Interest Organizations comment that an established numerical significance
threshold is not necessary, but if one is established, it should be used in tandem with the
SCC tool and should not be based solely on one metric, especially not on a comparison to
global emissions. Rather, they urge a holistic review of how a proposed project’s impacts
weigh against any benefits.170 EDF states that if the climate damages exceeded
monetized project benefits, the Commission could reject the project.171
167 The SC-GHG collectively includes the values for the SCC, the social cost of
methane (SCM), and social cost of nitrous oxide (SCN).
168 See, e.g., Policy Integrity Technical Conference Comments at 22-26; EPA 2021
Comments at 6; Ohio Environmental Council 2021 Comments at 2; Public Interest
Organizations 2021 Comments at 43-45; Attorneys General of Massachusetts et al. 2018
Comments at 17-22; EDF 2018 Comments at 8-11. The 2018 EDF comments were filed
by a slightly different set of entities than in 2021. Public Interest Organizations’ 2021
comments represent 53 entities including Natural Resources Defense Council.
169 EDF 2021 Comments at 14-16
1 Comments at 2; Public Interest
Organizations 2021 Comments at 43-45; Attorneys General of Massachusetts et al. 2018
Comments at 17-22; EDF 2018 Comments at 8-11. The 2018 EDF comments were filed
by a slightly different set of entities than in 2021. Public Interest Organizations’ 2021
comments represent 53 entities including Natural Resources Defense Council.
169 EDF 2021 Comments at 14-16.
170 Public Interest Organizations 2021 Comments at 43-45, 50-53, 60.
171 EDF 2021 Comments at 9.
Docket No. PL21-3-000
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Conversely, other commenters oppose use of the SCC tool in determining
significance172 or of using the SCC tool at all.173 The Attorneys General of Missouri,
Alabama, Alaska, Arizona, Arkansas, Georgia, Indiana, Kansas, Kentucky, Louisiana,
Mississippi, Montana, Nebraska, Ohio, Oklahoma, South Carolina, South Dakota,
Tennessee, Texas, Utah, and West Virginia (Attorneys General of Missouri et al.)
contends that the NGA does not allow use of the SCC tool to calculate speculative
damages and that its use is contrary to the Commission’s public interest responsibilities.
Further, they argue that NEPA does not permit the use of the SCC because NEPA does
not allow agencies to rely on conclusions that are speculative or reflect substandard or
outdated science.174
172 See, e.g., Kinder Morgan 2021 Comments at 32-40 (stating the Commission
should use the SCC tool only as a qualitative comparison tool).
173 See, e.g., American Forest Technical Conference Comments at 9; Competitive
Enterprise Institute Technical Conference Comments at 1-2, 7-35; Enbridge 2021
Comments at 111; Energy Infrastructure Council 2021 Comments at 24-25; Williams
2021 Comments 41-43.
174 Attorneys General of Missouri et al. 2021 Comments at 2-7
ission
should use the SCC tool only as a qualitative comparison tool).
173 See, e.g., American Forest Technical Conference Comments at 9; Competitive
Enterprise Institute Technical Conference Comments at 1-2, 7-35; Enbridge 2021
Comments at 111; Energy Infrastructure Council 2021 Comments at 24-25; Williams
2021 Comments 41-43.
174 Attorneys General of Missouri et al. 2021 Comments at 2-7. A similar group,
consisting of the Attorneys General of Missouri, Alabama, Alaska, Arizona, Arkansas,
Georgia, Indiana, Kansas, Kentucky, Mississippi, Montana, Nebraska, Ohio, Oklahoma,
South Carolina, Texas, Utah, West Virginia, and Wyoming (Attorneys General of
Missouri et al.), also submitted comments in response to the Commission’s technical
conference, see infra section III.C.1, extensively critiquing potential use of the SCC.
Attorneys General of Missouri et al. Technical Conference Comments at 3-15. Mr. Kirk
Frost also provided comments on use of the SCC, urging the Commission to use the tool
to assess GHG emissions impacts. Kirk Frost December 23, 2021 Technical Conference
Comments at 4.
Docket No. PL21-3-000
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Public Interest Organizations state that, while neither the NGA nor NEPA
explicitly reference the SCC tool, there is nothing in these or other federal statutes that
would prohibit its use.175 New Jersey Conservation Foundation notes that President
Biden’s Executive Order 13990 supports the use of the SC-GHG tools by agencies to
capture the full costs of GHG emissions as accurately as possible.176 New Jersey
Conservation Foundation states that following issuance of Executive Order 13990, the
Interagency Working Group on the Social Cost of Greenhouse Gases (GHG IWG)
published interim SC-GHG values, which the Commission should use.177
CEQ notes that it was working with representatives on the GHG IWG to develop
additional guidance regarding the application of the SC-GHG tools in decision-making
processes, including NEPA analysis.178 NGSA and API urge the Commission to
13990, the
Interagency Working Group on the Social Cost of Greenhouse Gases (GHG IWG)
published interim SC-GHG values, which the Commission should use.177
CEQ notes that it was working with representatives on the GHG IWG to develop
additional guidance regarding the application of the SC-GHG tools in decision-making
processes, including NEPA analysis.178 NGSA and API urge the Commission to wait for
this review to be completed.179 NGSA further states that it would be inappropriate for the
Commission to develop a likely conflicting approach for utilizing the SCC tool.180 API
states that it would violate principles of consistency for the Commission to apply the
175 Public Interest Organizations 2021 Comments at 58.
176 New Jersey Conservation Foundation 2021 Comments at 23-24 (citing Exec.
Order No. 13990, 86 FR 7037, 7040 (Jan. 25, 2021)).
177 New Jersey Conservation Foundation 2021 Comments at 24.
178 CEQ 2021 Comments at 2. C.f. Louisiana v. Biden, No. 21-cv-1074-JDC-KK
(W.D. La.) Order Granting Preliminary Injunction (Feb. 11, 2022).
179 API 2021 Comment at 24-25; NGSA 2021 Comments at 20-21.
180 NGSA 2021 Comments at 20-21.
Docket No. PL21-3-000
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interim SC-GHG values to current proposals (i.e., for the remainder of this year),
knowing that these values may change and lead to different treatment for future
proposals.181 EPA states that in cases where the Commission determines that a monetary
comparison between benefits and costs is appropriate, the Commission should take into
account established practices for benefit-cost analyses (e.g., the Office of Management
and Budget’s Circular A-4 and references therein)
r),
knowing that these values may change and lead to different treatment for future
proposals.181 EPA states that in cases where the Commission determines that a monetary
comparison between benefits and costs is appropriate, the Commission should take into
account established practices for benefit-cost analyses (e.g., the Office of Management
and Budget’s Circular A-4 and references therein). If the Commission chooses to use the
SC-GHG tools, EPA states that it should disclose all assumptions and levels of
uncertainty associated with the analysis.182
The Public Interest Organizations state that monetizing impacts using the SCC
tool provides the public and decisionmakers with accessible figures useful in determining
whether a project is in the public interest and allows the Commission to easily compare
project harms and economic benefits, whereas other metrics can misleadingly minimize
climate impacts due to inadequate contextualization.183
Kinder Morgan asserts that the SCC tool relies on inputs or assumptions that
introduce too much uncertainty.184 Similarly, Attorneys General of Missouri et al.
contends that the SCC tool is too speculative and arbitrary to hold up to the hard-look
181 API 2021 Comment at 25, 27-28.
182 EPA 2021 Comments at 2-3.
183 Public Interest Organizations 2021 Comments at 58.
184 Kinder Morgan 2021 Comments at 34-35.
Docket No. PL21-3-000
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requirement under NEPA.185 Rebutting this, EDF emphasizes that the GHG IWG’s
methodology is rigorous and based on the best available data and economic practices,
such as utilizing a 300-year time horizon.186 INGAA states that the significant variation
in output among GHG IWG’s interim values shows that discount rates reflect a high level
of uncertainty in the models and that an agency’s chosen discount rate wields an outsized
influence on the end result.187 INGAA states that the Commission should: (1) only use
the SCC tool within the NEPA evaluation, not the NGA evaluation; (2) use the SCC tool
as a re
ates that the significant variation
in output among GHG IWG’s interim values shows that discount rates reflect a high level
of uncertainty in the models and that an agency’s chosen discount rate wields an outsized
influence on the end result.187 INGAA states that the Commission should: (1) only use
the SCC tool within the NEPA evaluation, not the NGA evaluation; (2) use the SCC tool
as a relative, but not absolute, measure; (3) use the SCC tool only as a threshold
indicator; and (4) place any SCC estimates in the proper context.188
New Jersey Conservation Foundation recommends that the Commission use all of
the GHG IWG’s interim values provided for the SC-GHG tools (GHG IWG recommends
using a discount rate of 3%, but also provides values associated with discount rates of
2.5% and 5%).189
Boardwalk and Kinder Morgan argue that the Commission should only use the
SCC tool as a qualitative tool.190 Boardwalk further asserts that there should not be any
185 Attorneys General of Missouri et al. 2021 Comments at 9.
186 EDF 2021 Comments at 21.
187 INGAA 2021 Comments at 67.
188 INGAA 2021 Comments at 70-73.
189 New Jersey Conservation Foundation 2021 Comments at 24; see also EDF
2021 Comments at 6-7.
190 Boardwalk 2021 Comments at 103; Kinder Morgan 2021 Comments at 32-33.
Docket No. PL21-3-000
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triggering levels that would result in adverse action by the Commission or a significance
determination. Boardwalk contends that the use of trigger levels would create substantial
regulatory uncertainty
sey Conservation Foundation 2021 Comments at 24; see also EDF
2021 Comments at 6-7.
190 Boardwalk 2021 Comments at 103; Kinder Morgan 2021 Comments at 32-33.
Docket No. PL21-3-000
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triggering levels that would result in adverse action by the Commission or a significance
determination. Boardwalk contends that the use of trigger levels would create substantial
regulatory uncertainty. Kinder Morgan and Williams also express concern that the SCC
tool yields inherently one-sided GHG data if it is applied to a project in a manner that
monetizes only the project’s GHG costs and not the corresponding project benefits.191
Energy Infrastructure Council asserts that the SCC tool is meaningless without a standard
or threshold for significance and its use requires a monetized cost-benefit analysis of an
entire project.192
Kinder Morgan states that the SCC tool was not designed for project-specific
analysis but could be used as a screening tool in a qualitative analysis. If the
Commission uses the SCC tool, Kinder Morgan recommends that it should explain why
and how it was used.193 This explanation should include information about the SCC’s
function, its mechanism, its embedded limitations and assumptions, and the specific
reason for its application in a given circumstance. Kinder Morgan states that this type of
explanation is vital to avoid misleading the public about the purpose of the SCC
calculation and the meaning of its results.194 Spectra Energy Partners, LP and Seneca
Resources Corporation contend that the Commission has no basis to designate a
191 Kinder Morgan 2021 Comments at 32-33; Williams 2021 Comments at 44-45.
192 Energy Infrastructure Council 2021 Comments at 26-27.
193 Kinder Morgan 2021 Comments at 42.
194Id.
leading the public about the purpose of the SCC
calculation and the meaning of its results.194 Spectra Energy Partners, LP and Seneca
Resources Corporation contend that the Commission has no basis to designate a
191 Kinder Morgan 2021 Comments at 32-33; Williams 2021 Comments at 44-45.
192 Energy Infrastructure Council 2021 Comments at 26-27.
193 Kinder Morgan 2021 Comments at 42.
194Id.
Docket No. PL21-3-000
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particular SCC dollar amount as significant, and any such designation would be arbitrary
and could not meaningfully inform the Commission’s decision making or the public.195
Additionally, Kinder Morgan states that the Commission should not use the SCC tool to
determine mitigation measures or conditions because no statute requires that the
Commission implement mitigation based on calculations from such a tool.196
2.
Appropriate Level of NEPA Review and Significance
Determination
To determine the appropriate level of NEPA review, the Commission is
establishing a significance threshold of 100,000 metric tons or more per year of CO2e. In
calculating this emissions estimate, Commission staff will apply the 100% utilization or
“full burn” rate for natural gas supplies delivered by the proposed project and will
prepare an EIS if the estimated emissions from the proposed project may exceed the
100,000 metric tons per year threshold.
An emissions threshold of 100,000 metric tons per year of CO2e captures the
majority of annual emissions generated by Commission authorized projects, including
those that may result in incremental GHG emissions over a long duration that may have a
significant effect upon the human environment. Establishing a threshold for NEPA
purposes also provides Commission staff, industry, and other stakeholders clarity
195 Seneca Resources Corp. 2018 Comments at 9; Spectra Energy Partners, LP
2018 Comments at 87.
196 Kinder Morgan 2021 Comments at 42.
ding
those that may result in incremental GHG emissions over a long duration that may have a
significant effect upon the human environment. Establishing a threshold for NEPA
purposes also provides Commission staff, industry, and other stakeholders clarity
195 Seneca Resources Corp. 2018 Comments at 9; Spectra Energy Partners, LP
2018 Comments at 87.
196 Kinder Morgan 2021 Comments at 42.
Docket No. PL21-3-000
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regarding whether a particular project will result in the preparation of either an EA or an
EIS. We believe that such clarity ultimately benefits both the regulated community and
public by ensuring certainty regarding the Commission’s process for reviewing
applications for natural gas infrastructure.
In its NEPA document, staff will estimate the proposed project’s GHG emissions
based on all relevant evidence submitted in the record—including the project’s utilization
rate, offsets, and mitigation. A project with estimated emissions of 100,000 metric tons
per year of CO2e or greater will be presumed to have a significant effect, unless record
evidence refutes that presumption.197 While the 100,000 metric ton presumption will
serve as a guidepost, facilitating transparent, predictable analysis of a proposed project’s
contribution to climate change, our analysis will continue to consider all evidence in the
record on a case-by-case basis. As part of that analysis, the Commission will continue to
consider any emerging tools as well as any forthcoming frameworks or analysis issued by
CEQ or other agencies on this issue. Finally, as noted at the outset, we encourage
commenters to address this approach to assessing significance—including the 100,000
metric ton CO2e threshold.
197 When examining a project’s GHG emissions, the Commission will consider
record evidence of the construction, operational, and, where determined to be reasonably
foreseeable, downstream and upstream GHG emissions that reoccur annually over the life
of the project.
encourage
commenters to address this approach to assessing significance—including the 100,000
metric ton CO2e threshold.
197 When examining a project’s GHG emissions, the Commission will consider
record evidence of the construction, operational, and, where determined to be reasonably
foreseeable, downstream and upstream GHG emissions that reoccur annually over the life
of the project.
Docket No. PL21-3-000
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a.
Commission Authority to Establish a Threshold
Section 3 of the NGA requires the Commission to approve an application for the
exportation or importation of natural gas unless the proposal “will not be consistent with
the public interest.”198 Similarly, under section 7, the Commission must find a proposed
project is or will be required by the present or future public convenience and necessity.199
The Commission has long regarded section 3’s “public interest” standard and section 7’s
“public convenience and necessity” standard as substantially equivalent.200 In
considering applications under section 3 or section 7, the Commission must “evaluate all
factors bearing on the public interest.”201 The Commission has recognized from its
earliest decisions that it may consider the end use of gas as a factor in assessing the
198 15 U.S.C. 717b(a).
199 Id. 717f(c), (e).
200 Distrigas Corp. v. FPC, 495 F.2d 1057, 1065 (D.C. Cir.).
201 Atl. Ref. Co. v. Pub. Serv. Comm’n of State of N.Y., 360 U.S. 378, 391 (1959).
Commission must “evaluate all
factors bearing on the public interest.”201 The Commission has recognized from its
earliest decisions that it may consider the end use of gas as a factor in assessing the
198 15 U.S.C. 717b(a).
199 Id. 717f(c), (e).
200 Distrigas Corp. v. FPC, 495 F.2d 1057, 1065 (D.C. Cir.).
201 Atl. Ref. Co. v. Pub. Serv. Comm’n of State of N.Y., 360 U.S. 378, 391 (1959).
Docket No. PL21-3-000
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public interest202 and has long considered the impact of natural gas combustion on air
pollution.203
As discussed above, the courts have interpreted the Commission’s obligations
under NEPA to require analysis of downstream GHG emissions for NGA section 7
certificate projects, but do not require an analysis of either downstream or upstream GHG
emissions for section 3 export projects.204 As also discussed above, the Commission has
previously acknowledged that upstream emissions for NGA section 7 certificate projects
may be difficult to quantify. However, as noted, the Commission will continue to
consider on a case-by-case basis whether GHG emissions from upstream production
202 See, e.g., Hope Nat. Gas Co., 4 FPC 59, 59, 66-67 (1944) (stating that
“considerations of conservation are material to the issuance of certificates of public
convenience and necessity under section 7” and authorizing a project in large part
because of the particular end use of the gas); see N. Nat. Gas Co., 15 FPC 1634, 1641
e-by-case basis whether GHG emissions from upstream production
202 See, e.g., Hope Nat. Gas Co., 4 FPC 59, 59, 66-67 (1944) (stating that
“considerations of conservation are material to the issuance of certificates of public
convenience and necessity under section 7” and authorizing a project in large part
because of the particular end use of the gas); see N. Nat. Gas Co., 15 FPC 1634, 1641
(1956) (Connole, Comm’r, dissenting) (contending that the Commission has “long held
that considerations of conservation, inferior and superior uses, and related matters are
relevant to determining whether the public convenience and necessity require the
issuance of a certificate”).
203 Transwestern Pipeline Co., 36 FPC 176, 185-186, 189-191 (1966) (citing FPC
v. Transcon. Gas Pipe Line Corp., 365 U.S. 1 (1961) (Transco), for the proposition that
the “end use of gas was properly of concern to [the Commission], and made it clear that
air pollution was a relevant consideration”). Cf. Am. La. Pipe Line Co., 16 FPC 897,
899-900 (1956) (“[T]here is a public need for and will be a public benefit from [the
proposed] natural-gas service . . . . This need and benefit arise from the facts, among
others, . . . that natural gas is a clean, convenient and efficient fuel.”).
204 See supra PP 34-37.
Docket No. PL21-3-000
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activities are a reasonably foreseeable and causally connected result of a proposed
project.205
Contrary to the suggestion of some commenters, the Commission would not
intrude into another agency’s domain by establishing a significance threshold
acts, among
others, . . . that natural gas is a clean, convenient and efficient fuel.”).
204 See supra PP 34-37.
Docket No. PL21-3-000
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activities are a reasonably foreseeable and causally connected result of a proposed
project.205
Contrary to the suggestion of some commenters, the Commission would not
intrude into another agency’s domain by establishing a significance threshold. The
Commission does not propose to set an emissions standard that projects will be expected
to meet; rather, the threshold would be an indication of potential significance for
purposes of the Commission’s review of a project’s environmental impacts under NEPA
and trigger the preparation of an EIS.206
As discussed above, NEPA requires the Commission to take a “hard look” at the
environmental consequences of a proposed action and to prepare an EIS disclosing its
analysis to the public where its action may significantly affect the quality of the human
environment, or to prepare an EA for a proposed action that is not likely to have
significant effects or when the significance is unknown to determine if an EIS is
necessary. We note that neither EPA nor CEQ raise objections to the Commission
determining the significance of GHG emissions; in fact, EPA points to Executive
Order 14008, which directs the federal government to prioritize assessment, disclosure,
205 See supra P 42.
206 The Commission notes that CEQ and EPA are undertaking initiatives that may
culminate in the establishment of a significance threshold for GHG emissions or that may
further impact the Commission’s determination of GHG significance in its NEPA
analysis. If CEQ or EPA issues any future guidance regarding the evaluation of GHG
emissions, the Commission may adjust its methods for determining the significance of
GHG emissions consistent with that guidance.
es that may
culminate in the establishment of a significance threshold for GHG emissions or that may
further impact the Commission’s determination of GHG significance in its NEPA
analysis. If CEQ or EPA issues any future guidance regarding the evaluation of GHG
emissions, the Commission may adjust its methods for determining the significance of
GHG emissions consistent with that guidance.
Docket No. PL21-3-000
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and mitigation of climate pollution and climate-related risks, in response to the
Commission’s query on how it could determine the significance of a project’s GHG
emissions.207
As discussed above, NEPA requires the Commission to determine whether a
project would have any significant effects on the environment, including the effects of
GHG emissions on the climate.208 Moreover, courts have rejected the claim that under
the NEPA framework, the determination of whether an impact is significant must not
involve any subjective judgment calls.209
207 EPA 2021 Comments at 6.
208 See supra PP 23-25.
209 Spiller v. White, 352 F.3d at 244 n.5.
Docket No. PL21-3-000
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We are establishing a uniform GHG emissions threshold because GHG emissions
affect climate to the same degree, regardless of the location or specifics of a particular
project. Establishing such a threshold will provide the Commission a workable and
consistent path forward to analyze proposed projects. Further, a numerical threshold is a
clear, consistent standard that can be easily understood and applied by the regulated
community and interested stakeholders.
b.
Rationale for an Emissions Threshold of 100,000 Metric
Tons Per Year
Human impact on the warming of the global climate system is unequivocal.210
Even if deep reductions in GHG emissions are achieved, the planet is projected to warm
by at least 1.5 degrees Celsius (°C ) by 2050.211 This level of warming will present major
global consequences
ted
community and interested stakeholders.
b.
Rationale for an Emissions Threshold of 100,000 Metric
Tons Per Year
Human impact on the warming of the global climate system is unequivocal.210
Even if deep reductions in GHG emissions are achieved, the planet is projected to warm
by at least 1.5 degrees Celsius (°C ) by 2050.211 This level of warming will present major
global consequences. For example, extreme temperature events that may have occurred
once in 10 years on average in a climate without human influence will occur 4.1 times as
frequently and be 1.9°C hotter.212 Agricultural and ecological drought events that may
have occurred once in 10 years on average across drying regions in a climate without
human influence will occur twice as frequently.213 Warming beyond 1.5°C presents even
more severe consequences. The Intergovernmental Panel on Climate Change states that
210 IPCC Report at SPM-5.
211 See IPCC Report at SPM-17.
212 IPCC Report at SPM-23.
213 IPCC Report at SPM-23.
Docket No. PL21-3-000
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“[w]ith every additional increment of global warming, changes in extremes continue to
become larger.”214 For example, every subsequent 0.5°C of warming “causes clearly
discernible increases in the intensity and frequency of hot extremes, including heatwaves
(very likely), and heavy precipitation (high confidence), as well as agricultural and
ecological droughts in some regions (high confidence).”215 Because of the dire effects at
stake, even relatively minor GHG emissions pose a significant threat, 100,000 metric tons
per year of project GHG emissions will capture all natural gas projects that have what we
believe to be the potential for causing significant impacts on climate, given the typical
lifespans of authorized projects. For a single natural gas project with a lifespan of 30
years, this threshold represents a total of three million metric tons of GHG emissions
significant threat, 100,000 metric tons
per year of project GHG emissions will capture all natural gas projects that have what we
believe to be the potential for causing significant impacts on climate, given the typical
lifespans of authorized projects. For a single natural gas project with a lifespan of 30
years, this threshold represents a total of three million metric tons of GHG emissions.
Based on an internal review of natural gas projects from 2008 to 2021, a
100,000 metric tons per year threshold will cover the vast majority of potential GHG
emissions from natural gas projects authorized by the Commission. For context, projects
that likely have 100,000 metric tons per year or more of GHG emissions include projects
transporting an average of 5,200 dekatherms per day and projects involving the operation
of one or more compressor stations or LNG facilities.
Outside the NEPA context, other federal and state agencies that have established
thresholds to evaluate or regulate GHG emissions from an analysis of the emissions from
regulated sources. Most notably, in 2012, EPA issued the Tailoring Rule to regulate
214 IPCC Report at SPM-19.
215 IPCC Report at SPM-19 (emphasis in original).
Docket No. PL21-3-000
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GHG emissions from stationary sources of air pollution under the Prevention of
Significant Deterioration (PSD)216 and Title V217 permitting programs218 and proposed to
phase in the regulation of GHG emissions in two steps. Under Step 1, sources already
subject to the PSD permitting program for at least one non-GHG pollutant (“anyway”
sources) were required to utilize best available control technology (BACT) for GHG
emissions219 if they increased net GHG emissions by at least 75,000 tons per year of
CO2e.
216 The PSD permitting program is part of the New Source Review program,
which requires new stationary sources and major modifications to existing major sources
to obtain preconstruction permits
G pollutant (“anyway”
sources) were required to utilize best available control technology (BACT) for GHG
emissions219 if they increased net GHG emissions by at least 75,000 tons per year of
CO2e.
216 The PSD permitting program is part of the New Source Review program,
which requires new stationary sources and major modifications to existing major sources
to obtain preconstruction permits. PSD is designed to prevent air quality deterioration in
regions that are attaining the National Ambient Air Quality Standards by requiring major
sources or major modifications to install the Best Available Control Technology (BACT).
Major sources under the PSD program are defined as facilities that emit or have the
potential to emit 250 tons per year of any criteria air pollutant or 100 tons per year of any
criteria air pollutant for specific types of facilities listed in the statute. 42 U.S.C. 7479(1).
The six criteria pollutants are carbon monoxide, ground-level ozone, lead, nitrogen
dioxide, particulate matter, and sulfur dioxide. 40 CFR pt. 50.
217 The Title V program requires major stationary sources to obtain a single
operating permit that consolidates all of the permitting requirements in the Clean Air Act
into a single permit, including PSD, New Source Performance Standards, and National
Emission Standards for Hazardous Air Pollutants. Major sources under the Title V
program are defined as any stationary facility that emits or has the potential to emit 100
tons per year of any hazardous air pollutant, except GHGs. 42 U.S.C. 7602(j). The
Clean Air Act Amendments of 1990 originally designated over 180 chemicals as
hazardous air pollutants, and EPA has the authority to modify the list through
rulemaking. 42 U.S.C. 7412(b)-(c).
218 Prevention of Significant Deterioration and the Title V Greenhouse Gas
Tailoring Rule, 75 FR 31514 (June 3, 2010) (Tailoring Rule)
f any hazardous air pollutant, except GHGs. 42 U.S.C. 7602(j). The
Clean Air Act Amendments of 1990 originally designated over 180 chemicals as
hazardous air pollutants, and EPA has the authority to modify the list through
rulemaking. 42 U.S.C. 7412(b)-(c).
218 Prevention of Significant Deterioration and the Title V Greenhouse Gas
Tailoring Rule, 75 FR 31514 (June 3, 2010) (Tailoring Rule).
219 BACT is used to minimize emissions based on the maximum degree of control
that the facility can achieve as determined by the permitting authority on a case-by-case
basis. BACT may be a design, equipment, work practice, or operational standard, such as
add-on control equipment, fuel cleaning or treatment, or innovative fuel combustion
Docket No. PL21-3-000
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Under Step 2, EPA expanded the Tailoring Rule by requiring a new source or a
major modification to an existing source to obtain PSD and/or Title V permits based on
GHG emissions alone. Sources that had the potential to emit at least 100,000 tons per
year of CO2e would become newly subject to the PSD and/or Title V requirements, even
if they did not exceed the statutory threshold for any other pollutant. Additionally,
modifications to an existing source already subject to PSD and/or Title V that increased
net GHG emissions by at least 75,000 tons per year of CO2e would be subject to PSD
requirements regardless of whether there was an increase in the emissions of any other
pollutant.220
In setting the 75,000 tons and 100,000 tons per year of GHGs thresholds, EPA
considered the administrative burden of permitting the estimated number of additional
facilities under each threshold and the percentage of total national stationary source GHG
emissions that would be covered under the threshold.221 For example, under Step 1, EPA
estimated a 5% increase in the total annual cost to run the permitting programs and that
approximately 65% of GHG emissions would be covered
d the administrative burden of permitting the estimated number of additional
facilities under each threshold and the percentage of total national stationary source GHG
emissions that would be covered under the threshold.221 For example, under Step 1, EPA
estimated a 5% increase in the total annual cost to run the permitting programs and that
approximately 65% of GHG emissions would be covered. Under Step 2, EPA estimated
that approximately 550 new sources would become subject to the PSD and Title V
techniques. Note that BACT for minimizing GHG emissions at natural gas facilities is
limited.
220 EPA also planned a Step 3 to further reduce the threshold, although not below
50,000 tons per year of CO2e. The Supreme Court struck down relevant portions of the
Tailoring Rule before EPA finalized Step 3.
221 Tailoring Rule, 75 FR at 31533-80.
Docket No. PL21-3-000
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programs, increasing total annual costs to run the programs by 42% and covering 67% of
GHG emissions. EPA further found that lowering the threshold to 50,000 or 25,000 tons
per year of CO2e would drastically increase both the number of new facilities requiring
permits and the cost of administering the programs but would only marginally increase
the percentage of GHG emissions covered to 70% and 75%, respectively.
In 2014, the Supreme Court invalidated portions of the Tailoring Rule, holding
that EPA may not use GHG emissions as the sole basis for determining whether a source
is subject to a PSD or Title V permitting requirements.222 While the Supreme Court’s
ruling struck down Step 2 of the Tailoring Rule, it upheld Step 1 and allowed EPA to
continue to regulate GHG emissions from “anyway” sources
In 2014, the Supreme Court invalidated portions of the Tailoring Rule, holding
that EPA may not use GHG emissions as the sole basis for determining whether a source
is subject to a PSD or Title V permitting requirements.222 While the Supreme Court’s
ruling struck down Step 2 of the Tailoring Rule, it upheld Step 1 and allowed EPA to
continue to regulate GHG emissions from “anyway” sources. Notably, the decision did
not discuss EPA’s methodology for establishing the thresholds; it only ruled that
deviating from the 100 and 250 tons per year statutory thresholds in the Clean Air Act
when requiring sources to newly obtain PSD or Title V permits based solely on GHG
emissions under Step 2 was impermissible.
Further, at least two agencies in California that are directed to determine the
significance of GHG emissions and climate impacts of proposed projects under the
California Environmental Quality Act have also proposed or established thresholds of
significance based on an analysis of regulated sources. First, in 2008, the California Air
Resources Board (California ARB) proposed finding a less than significant impact for a
proposed industrial project that, with mitigation, emits no more than 7,000 metric tons
222 Util. Air Regul. Grp. v. EPA, 573 U.S. 302, 320 (2014).
Docket No. PL21-3-000
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per year of CO2e from non-transportation sources, including combustion and fugitive
emissions.223 Second, the South Coast Air Quality Management District (South Coast
AQMD) adopted an interim GHG significance threshold of 10,000 metric tons of CO2e
per year for stationary sources of air pollution in 2008.224 Both California ARB and
South Coast AQMD found that their thresholds would capture approximately 90% of
emissions from their respective regulated sources.225
Like EPA and the California agencies, we are basing our threshold on an analysis
of regulated sources
ted an interim GHG significance threshold of 10,000 metric tons of CO2e
per year for stationary sources of air pollution in 2008.224 Both California ARB and
South Coast AQMD found that their thresholds would capture approximately 90% of
emissions from their respective regulated sources.225
Like EPA and the California agencies, we are basing our threshold on an analysis
of regulated sources. Although we are adopting a conceptually similar methodology in
establishing our threshold, we note that our approach will cover a larger number of
emissions than the threshold established by EPA in the Tailoring Rule. EPA’s thresholds
of 75,000 and 100,000 tons per year accounted for only 65% and 67% of emissions from
EPA-regulated sources, respectively, whereas our proposed threshold of 100,000 metric
tons per year would deem nearly three-quarters of Commission-regulated natural gas
project, which collectively account for roughly 99% of GHG emissions from
223 California ARB, Preliminary Draft Staff Proposal, Recommended Approaches
for Setting Interim Thresholds for Greenhouse Gases under the California Environmental
Quality Act (Oct. 24, 2008) (CEQA Proposed Interim Thresholds). In addition,
California ARB proposed to require these projects to meet performance standards for
construction-related emissions and transportation to support a finding of less than
significant impacts. CEQA Proposed Interim Thresholds at attach. A.
224 South Coast AQMD, Interim CEQA GHG Significance Threshold for
Stationary Sources, Rules and Plans (Dec. 5, 2008), http://www.aqmd.gov/docs/default-
source/ceqa/handbook/greenhouse-gases-(ghg)-ceqa-significance-
thresholds/ghgboardsynopsis.pdf?sfvrsn=2.
225 Id. at 4; CEQA Proposed Interim Thresholds at attach. A.
ss than
significant impacts. CEQA Proposed Interim Thresholds at attach. A.
224 South Coast AQMD, Interim CEQA GHG Significance Threshold for
Stationary Sources, Rules and Plans (Dec. 5, 2008), http://www.aqmd.gov/docs/default-
source/ceqa/handbook/greenhouse-gases-(ghg)-ceqa-significance-
thresholds/ghgboardsynopsis.pdf?sfvrsn=2.
225 Id. at 4; CEQA Proposed Interim Thresholds at attach. A.
Docket No. PL21-3-000
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Commission-regulated natural gas projects, to have a significant impact on climate
change.
3.
Other Metrics
As noted above, commenters argue for and against the use of various existing
GHG inventories or goals as a comparison tool to determine significance. Comparison to
an existing GHG inventory or goal presents substantially different percentages based on
the chosen goal (international, state, regional, or local). Because different projects may
have different potential purposes and the purpose of a project may be characterized to
support or oppose a particular viewpoint, we do not believe that tying the Commission’s
significance determination for a proposed project’s GHG emissions to a particular
inventory or goal is appropriate. However, we recognize that this type of comparison can
be helpful to inform the Commission’s analysis and the public, especially when presented
using a consistent metric across proposed projects under consideration by the
Commission. We note that many commenters reference the SC-GHG as one tool. To
the extent permitted by law,226 the Commission could consider the SC-GHG in the future.
226 Currently, two pending court cases challenge use of the IWG’s interim values
by federal agencies. Mo. v. Biden, --- F. Supp. 3d ----, 2021 WL 3885590 (E.D. Mo.
Aug. 31, 2021), appeal filed, No. 21-3013 (8th Cir.); La. v. Biden, No. 21-cv-1074-JDC-
KK (W.D. La).
eference the SC-GHG as one tool. To
the extent permitted by law,226 the Commission could consider the SC-GHG in the future.
226 Currently, two pending court cases challenge use of the IWG’s interim values
by federal agencies. Mo. v. Biden, --- F. Supp. 3d ----, 2021 WL 3885590 (E.D. Mo.
Aug. 31, 2021), appeal filed, No. 21-3013 (8th Cir.); La. v. Biden, No. 21-cv-1074-JDC-
KK (W.D. La).
Docket No. PL21-3-000
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C.
Mitigation
Federal agencies can use mitigation to minimize the potential adverse
environmental effects of their actions,227 and mitigation is used by the Commission in
reviewing NGA sections 3 and 7 proposals.228
The NGA grants the Commission broad authority to attach reasonable terms and
conditions to NGA section 7 certificates of public convenience and necessity and NGA
section 3 authorizations.229 The Commission has consistently exercised this authority to
attach environmental conditions that mitigate the adverse environmental impacts of a
proposed project, and the Commission is not precluded from utilizing this authority to
227 Mitigation is measures that avoid, minimize, or counterbalance effects caused
by a proposed action by: (1) avoiding the impact altogether by not taking a certain action
or parts of an action; (2) minimizing impacts by limiting the degree or magnitude of the
action and its implementation; (3) rectifying the impact by repairing, rehabilitating, or
restoring the affected environment; (4) reducing or eliminating the impact over time by
preservation and maintenance operations during the life of the action; and/or
e impact altogether by not taking a certain action
or parts of an action; (2) minimizing impacts by limiting the degree or magnitude of the
action and its implementation; (3) rectifying the impact by repairing, rehabilitating, or
restoring the affected environment; (4) reducing or eliminating the impact over time by
preservation and maintenance operations during the life of the action; and/or
(5) compensating for the impact by replacing or providing substitute resources or
environments. 40 CFR 1508.1.
228 As discussed supra P 26, NEPA contains no substantive requirement that
environmental impacts be mitigated or avoided, however, the environmental document
must include a mitigation discussion that provides “sufficient detail” to indicate that
environmental impacts have been fairly evaluated. S. Fork Band Couns. of W. Shoshone
of Nev. v. U.S. Dep’t of Interior, 588 F.3d 718, 727 (9th Cir. 2009); see also Nat’l Parks
& Conservation Ass’n v. U.S. Dep’t of Transp., 222 F.3d 677, 681 n.5 (9th Cir. 2000)
(stating that mitigation measures proposed in an EIS “need not be legally enforceable,
funded, or even in final form to comply with NEPA’s procedural requirements”).
229 See supra P 22; see also 15 U.S.C. 717b(e)(3)(A) (providing the authority to
approve an application for an LNG Terminal, “in whole or part, with such modifications
and upon such terms and conditions as the Commission find[s] necessary or
appropriate”).
sures proposed in an EIS “need not be legally enforceable,
funded, or even in final form to comply with NEPA’s procedural requirements”).
229 See supra P 22; see also 15 U.S.C. 717b(e)(3)(A) (providing the authority to
approve an application for an LNG Terminal, “in whole or part, with such modifications
and upon such terms and conditions as the Commission find[s] necessary or
appropriate”).
Docket No. PL21-3-000
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require a project sponsor to mitigate all, or a portion of, the impacts related to a proposed
project’s GHG emissions. Therefore, consistent with the d
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