Inside Track: Planning, Environment & Sustainability - In the media, In practice and courts, Cases and Legislation - Real Estate and Construction


To print this article, all you need is to be registered or login on Mondaq.com.

The authors explain that stakeholders interested in how
climate change is addressed in the context of the National
Environmental Policy Act should closely follow developments from
the Council on Environmental Quality and the Federal Energy
Regulatory Commission.

Two federal agencies are gearing up to release new policies,
ostensibly to bring long-awaited clarity and predictability on one
of the thorniest issues in National Environmental Policy Act
(“NEPA”) practice—the assessment and mitigation of
greenhouse gas (“GHG”) emissions. The Council on
Environmental Quality (“CEQ”) and the Federal Energy
Regulatory Commission (“FERC”) have both announced their
intention to change policy direction from the Trump Administration,
and FERC has already begun implementing its strategy

WHAT IS CEQ’S PLANNED STRATEGY?

In the coming months, the CEQ will reveal its plan for revising
the NEPA regulations and guidance for analyzing GHG emissions. The
CEQ announced in the Spring 2021 Unified Regulatory Agenda that it
will be undertaking a two-phased approach for revising the
CEQ’s NEPA implementing regulations that were finalized by the
Trump Administration in July 2020 (“2020 Rule”). In phase
1, “narrow changes” will be proposed in July, and in
phase 2, “broader changes” will be proposed in November
2021.1 The CEQ will also be issuing a notice related to the GHG
emissions guidance in September 2021.2 Indeed, these will be among
the highest priority items for the CEQ’s chair, Brenda Mallory.
CEQ should be able to proceed with its strategy without the
intervention of the courts, as the U.S. District Court for the
Western District of Virginia’s dismissed a challenge by
conservation groups to the 2020 Rule on grounds of standing and
ripeness on June 21, 2021,3 and the four other challenges to the
2020 Rule have been stayed.

HOW HAS FERC ALREADY BEGUN IMPLEMENTING ITS STRATEGY?

Under the leadership of new Chair Richard Glick, FERC is wasting
no time in charting its own course on the GHG emissions impacts of
natural gas projects. In February 2021, FERC issued a Notice of
Inquiry (“NOI”) seeking input on some of the same
NEPA/GHG issues that CEQ must address, among other issues, with the
intent of updating FERC’s 1999 policy statement on the
certification of new interstate natural gas transportation
facilities (the 1999 Certificate Policy Statement).4 As of June
2021, FERC has received over 150 comments on the NOI.

In the NOI, FERC posed a series of questions relating to how it
should determine whether a proposed natural gas project meets the
public convenience and necessity test under Section 7 of the
Natural Gas Act. Among other things, FERC sought input on how it
should consider impacts to environmental justice communities. FERC
also raised fundamental questions about the evaluation of GHG
emissions impacts and alternatives under NEPA. For example, FERC
sought feedback on the:

  • Scope of GHG emissions impact assessment (e.g., whether and how
    to consider upstream and downstream impacts);

  • Calculation of a project’s carbon footprint (e.g., whether
    and how to determine if a project’s GHG emissions may be offset
    by reduced GHG emissions from the project’s operations, such as
    displacing more carbon-intensive fuel sources);

  • Assessment of the “significance” of a project’s
    carbon footprint;

  • Appropriate use of the social cost of carbon in NEPA analysis;
    and

  • Whether FERC has authority to impose mitigation for GHG
    emissions and if so, which GHG emissions should be mitigated and
    how.

In the meantime, in March 2021, FERC issued an order approving
the Northern Natural’s South Sioux City to Sioux Falls A-line
Replacement project. In that order, the Commission and established
new precedent for how it will assess the significance of a natural
gas project’s GHG emissions impacts.5 In addition, following a
June 2021 decision by the U.S. Court of Appeals for the D.C.
Circuit decision vacating FERC approval of the Spire STL Pipeline,
there is new urgency to issue a revised Certificate Policy.6

Footnotes

* Ethan G. Shenkman and Sandra E. Rizzo are partners in
the Washington, D.C., office of Arnold & Porter. Emily Orler is
an associate in the firm’s office in Washington, D.C. The
authors may be contacted at ethan.shenkman@arnoldporter.com,
sandra.rizzo@arnoldporter.com, and emily.orler@arnoldporter.com,
respectively.

1 See Office of Management and Budget, Office of
Information and Regulatory Affairs (“OIRA”), National
Environmental Policy Act Implementing Regulations
Revisions—RIN: 0031- AA05; OIRA, National Environmental
Policy Act Implementing Regulations Revisions—RIN
0331-AA07.

2 See OIRA, National Environmental Policy Act Guidance on
Consideration of Greenhouse Gas Emissions and Climate
Change—RIN 0331-AA06; see also CEQ’s rescission of
Trump’s proposed NEPA climate guidance (Mar. 31,
2021).

3 Wild Virginia v. Council on Env’t Quality, No.
3:20CV00045 (W.D. Va. June 21, 2021).

4 FERC, Certification of New Interstate Natural Gas
Facilities, 86 Fed. Reg. 11,268 (Feb. 24, 2021),
https://bit.ly/2SAZa2b; see also Certification of New Interstate
Natural Gas Pipeline Facilities, 88 FERC ¶ 61,227 (Sept. 15,
1999), clarified, 90 FERC ¶ 61,128 (Feb. 9, 2000), further
clarified, 92 FERC ¶ 61,094 (July 28, 2000).

5 Northern Natural Gas Company, 174 FERC ¶ 61,189
(Mar. 22, 2021).

6 Env’t Def. Fund v. Fed. Energy Regul. Comm’n,
No. 20-1016 (D.C. Cir. June 22, 2021).


To read the full article click here

Originally Published by PRATT’S ENERGY LAW
REPORT

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.

Leave a Reply

Your email address will not be published. Required fields are marked *