Russia’s war in Ukraine and its impact on energy supplies took center stage at a March 3 U.S. Senate Committee on Energy and Natural Resources hearing as senators emphasized the need to get more oil and natural gas flowing. Central to the Thursday debate on increasing supplies was a recent decision by the Federal Energy Regulatory Commission to change the criteria for permitting natural gas projects to include greenhouse gas emissions, environmental justice and harm to landowners.
It turned into one of the most dynamic hearings the committee has seen in years, with Democratic and Republican lawmakers and commissioners vigorously defending their positions, mostly off script.
Senators from both sides of the aisle agreed that accelerating FERC project certifications is critical but they differed sharply on the cause of delays.
Democratic commissioners and lawmakers blamed earlier FERC decisions approving pipeline permits that failed to comply with federal law governing natural gas and environmental assessments, which later faced lawsuits. “If you cut corners or if you don’t follow the court rulings,” you will delay the construction of natural gas pipelines and liquified natural gas projects, causing cost overruns, FERC Chair Rich Glick told the committee.
Committee Chair Joe Manchin (D-WV) and his Republican colleagues insisted construction delays will be due to new policy guidance approved by the Democratic majority of commissioners that expands the definition of “public interest” impacts beyond the agreements between pipeline builders and shippers.
FERC’s policy update to regulatory language dating from 1999 “swings far to the left” and “exacerbates the politicization of your industry,” Manchin asserted. Nothing was said, however, of the Trump Administration’s approval of two Republican nominations to the commission while holding back for months the nomination of Democratic pick Allison Clements, nor of other partisan action by the former administration.
The commission majority “is making inflation worse,” said Sen. John Barrasso (R-WY).
Last month, FERC approved, on a partisan 3-2 vote, two linked policy changes. The first one updates its policy for allowing interstate gas pipelines. The second one sets a framework for assessing greenhouse gas impacts.
Rejecting GHG emission impacts is absurd
Sen. Angus King (D-ME), who noted his own experience working on getting energy projects certified at FERC, including a 2 megawatt hydro project, called the opposition to consider climate impacts to comply with the National Environmental Policy Act absurd. “The idea that we can’t examine the most serious threat the world has ever faced is preposterous.”
But for Commissioner Mark Christie, FERC’s vote last month “is only the latest example of action delaying and adding cost to natural gas applications.” Pipeline delays also impact the price of electricity because so much of it is made by burning natural gas. He said the Democratic commissioners acted beyond their authority in weighing whether a project’s greenhouse gas impacts are significant, setting a temporary threshold at 100,000 metric tons.
Under the new interim greenhouse gas policy, a pipeline or liquefied natural gas facility that’s expected to release 100,000 metric tons of greenhouse gases per year when operating at maximum capacity would require a full Environmental Impact Statement under NEPA. In addition, the adequacy of proposed mitigation measures would be evaluated on a case-by-case basis.
Glick said the commission weighs whether a gas project’s environmental impacts are significant “all the time” and including carbon emissions is no different. “We are just following the law.” He and Clements also pointed out the harm is weighed against project benefits and developers can propose mitigation measures.
A number of court decisions, including from the DC Circuit Court of Appeals, have rejected FERC pipeline certifications for failing to adequately weigh project impacts on the public.
Commissioner James Danly insisted that FERC need not follow the court decisions, because the language is not mandatory “This is a classic case of doing indirectly what you can’t do directly,” he said of his Democratic colleagues.
Including environmental justice
But for Commissioner Willie Phillips, “Our guidance is a first step in addressing uncertainty and delay in natural gas certifications.” He stressed the importance of FERC finally weighing environmental justice concerns of projects. “FERC has not done enough to consider environmental justice communities,” he said. The policy statements “give us a real opportunity for them to be heard on the front end” of certification, not after it is a done deal.
FERC Chair Glick told the committee that his agency has permitted 18 projects but nine have not been built, which is no fault of the agency. He added that there are gas project certifications pending that are stalled by a lack of consensus. He gave no details.
Two democratic committee senators, Sen. Martin Heinrich (D-NM) and Catherine Cortez Masto (D-NV), applauded the five commissioners for their independence and differences of opinion. Cortez Masto and Sen. Mazie Hirono (D-HI) suggested FERC narrow its certification guidance to reduce opposition.