FERC’s consideration of indirect environmental impacts of the projects it certifies has been heavily debated as the concerns over climate change increase.  Both the National Environmental Policy Act (NEPA) and Natural Gas Act (NGA) require that FERC consider how an interstate natural gas pipeline directly and indirectly affects the human environment.  Although consideration of direct impacts may be a less controversial topic, FERC’s approach with respect to indirect impacts[1] has proven to be more complex.  It is particularly relevant in light of the Council on Environmental Quality’s (CEQ’s) June 2019 proposed guidance, directing how federal agencies should assess project-related greenhouse gas emissions, discussed in detail here and here.  The guidance suggest that FERC should employ a “rule of reason” when considering impacts of greenhouse gas emissions and if FERC lacks adequate information about these emissions, it does not need to quantify them.  This recommended approach, however, seems to conflict with how the D.C. Circuit interpreted FERC’s duty in analyzing greenhouse gas and other indirect emissions in its earlier June 2019 decision Birckhead v. FERC, USCA Case No. 18-1218 (D.C. Cir. 2019).  Continue Reading D.C. Circuit Suggests FERC Should Try to Quantify Indirect Environmental Impacts of Pipeline Projects

The Council on Environmental Quality (CEQ) issued new draft guidance at the end of June intended to further permit streamlining generally and greenhouse gas (GHG) analysis specifically.  The new guidance replaces previous CEQ guidance issued by the Obama Administration on how GHG effects should be estimated for projects during review under the National Environmental Policy Act (NEPA).  Whether and how a federal Agency must consider GHG emissions during NEPA review continues to be a controversial issue for pipeline construction and expansion projects that require federal permits.

Continue Reading Proposed CEQ Guidelines on Climate Change and NEPA Focus on Permit Streamlining

In an attempt to garner support from House Republicans following last week’s release of draft legislation to reauthorize the Pipeline Safety Act (PSA), Democrats on the House Energy and Commerce Committee released a more bipartisan version, The Safer Pipelines Act of 2019, H.R. 3432. The revised bill was subsequently approved by a House Energy and Commerce subcommittee and heads to the full committee for consideration and mark-up. At a minimum, it appears that legislators in the House are working towards issuing a bill prior to the August recess and reauthorization deadline of September 30, 2019. The revisions to the House pipeline safety seem designed to make a more palatable bill for the Senate as it contains some significant proposed changes from the prior discussion draft that was the subject of a contentious hearing in the House. Continue Reading House Democrats Seek Bipartisan Support with Revised Pipeline Safety Bill

The Pipeline and Hazardous Materials Safety Administration (PHMSA) has recently issued some Region Recommendations in enforcement actions that have either added new material allegations or requested relief beyond that contained in the underlying matter. The Agency’s rules do not provide for Region Recommendations to be used in that manner. If PHMSA decides to add new allegations or seek additional relief in an enforcement action, the rules (and precedent) anticipate those modifications will be made through an amendment of the underlying enforcement documents. Amended enforcement documents, if material, allow a Respondent a new opportunity to request a Hearing. It is not clear why PHMSA has started issuing Region Recommendations in this manner, but if left unchallenged it may have the effect of circumventing additional or expanded Hearings.

Region Recommendations are intended to respond to information submitted by the Respondent and to recommend the terms of final action to either the Presiding Official (where there has been a Hearing) or to the Associate Administrator (when no Hearing has occurred but a respondent has issued additional information for Agency consideration). Region Recommendations are typically prepared only in contested matters, especially after a Hearing. Where a matter is not contested, then the enforcement documents as issued presumably state all relevant allegations and describe the relief requested, thus a Region Recommendation should be unnecessary. Continue Reading Beyond the Scope of NOPVs – Recent Region Recommendations

As the Pipeline Safety Act (PSA) reauthorization deadline approaches, the Democrats on the House Energy and Commerce Committee recently released draft discussion legislation titled, The Safer Pipelines Act of 2019.  The “discussion draft” was released in advance of a Committee hearing held on June 19, 2019.  At the hearing, it became clear that the recent legislation was drafted behind closed doors and that it was not well received by the minority Republicans on the Committee or industry representatives.

With this most recent draft legislation, several noteworthy legislative changes are likely to be considered by the Committee, although two Committee Republicans questioned whether marking up the draft was worth the effort.  Notably, PHMSA declined to participate in the hearing because it did not have sufficient time to review the draft.  Industry trade group representatives provided testimony as well as a representative from the Pipeline Safety Trust.  The more significant proposals are summarized below and relate to:  (1) lowering the criminal liability standard; (2) expanding the definition of regulated gathering pipelines; (3) clarifying and expanding citizen suits; (4) substantially increasing the amount of operator information made available to local responders and to the public; and (5) other integrity management requirements regarding phasing out direct assessment and requiring automatic shut off valves for liquid pipelines.  Continue Reading Pipeline Safety Draft Legislation Adds New Proposals to Reauthorization Debate

The Department of Transportation (DOT) released a legislative proposal to Congress on June 3, 2019, to reauthorize the federal Pipeline Safety Act (PSA or the Act) and continue funding the federal agency charged with implementing it, the Pipeline and Hazardous Materials Safety Administration (PHMSA).  DOT’s press release states that the proposal, Protecting our Infrastructure of Pipelines and Enhancing Safety Act of 2019, will embrace innovation, clarify certain regulatory requirements to prevent incidents, “modernize” certain data collection, and enhance support for new liquefied natural gas (LNG) facilities.  Proposals target a broad array of topics including pipeline construction review, permitting, and reporting, criminal penalties, updating certain reporting thresholds, industry collaboration, and the scope of federal and state pipeline partnerships.  Continue Reading DOT Issues Pipeline Safety Act Reauthorization Proposal

The Pipeline and Hazardous Materials Safety Administration (PHMSA) is close to finalizing a rule applicable to the safety of natural gas transmission pipelines that has been nearly eight years in the making. Both Congress and the industry have urged PHMSA to issue a final rule and PHMSA has now signaled that the rule is currently awaiting final approval by the Office of Management and Budget (OMB). With a final rule that could be published in the coming weeks or months, pipeline operators should be prepared to review and modify their compliance programs as appropriate. Continue Reading Gas Pipeline Safety Rule Clearing Final Hurdle: Operators Should Prepare

With an increased interest in the resolving disputes efficiently and avoiding litigation where possible, the time may be right for the Pipeline and Hazardous Materials Safety Administration (PHMSA) to clarify the process for settlement of pipeline safety compliance issues, whether through new rules or a written settlement policy. On the hazardous materials regulatory front, PHMSA has historically engaged in settlements that are guided by an express allowance for settlement under the regulations. The Agency has also engaged in settlements in at least some pipeline safety cases over the years and more so in the last year. Without specific rules or a written settlement policy in place, however, settlements of pipeline safety matters in practice may not be consistently implemented.

Many federal agencies have settlement policies that encourage parties in enforcement actions to discuss issues before progressing to full administrative hearings. Such policies offer the possibility of narrowing, if not resolving, legal disputes, which can benefit all parties by realizing efficiencies and avoiding the cost of protracted disputes. These efforts are analogous to pre-trial conferences in federal courts, where a court may ask the parties to discuss whether issues can be narrowed or resolved without full adjudication, in order to ‘expedite disposition of the action’ and ‘facilitate settlement’ (see Fed.R.Civ.Proc. 16(a)). Continue Reading Pipeline Safety Settlements: Time to Take a Page from Hazmat?

Congress recently convened its third Committee Hearing on reauthorization of the Pipeline Safety Act, before the House Energy and Commerce Committee.  Much of the discussion of focused on pipeline security, among other issues that have been discussed in prior hearings. Adding to the focus was the absence of an invited representative from the Transportation Security Administration (TSA), the agency who is tasked with sharing oversight of pipeline security with PHMSA. The TSA has come under criticism in light of a recent Government Accountability Office report that was critical of the agency’s Pipeline Security Division and its ability to ensure the safety and reliability of pipeline energy network from both cyber and physical security saboteurs. That report cited “significant weaknesses” in TSA’s program and pointed to, among other challenges, a shortage of qualified inspectors to address cyberattacks and other physical intrusions facing pipelines. Continue Reading Third Pipeline Safety Act Hearing Focuses on Security

The White House issued a new Executive Order (EO) on April 10, 2019 intended to ‘revise the process for the development and issuance of Presidential Permits’ for certain cross border energy infrastructure.   The EO limits the opportunity and timeframe for federal agencies, states or Indian tribes to comment on Presidential Permit applications for oil, water or sewage pipelines and other border crossing infrastructure such as bridges, rail and surface roads.  The new EO clarifies that the ultimate decision to grant or deny such permits remains with the President (that authority was previously delegated to the State Department).

Continue Reading New Executive Order Attempts to Streamline Presidential Permits