On September 15, 2017, the Federal Energy Regulatory Commission (FERC) issued an order holding that the New York State Department of Environmental Conservation (NYSDEC) waived its authority under the Clean Water Act (CWA) by failing to issue or deny a water quality certificate, as requested by an interstate natural gas pipeline, within the CWA’s statutory one-year timeframe. Millennium Pipeline Co., L.L.C., 160 FERC ¶ 61,065 (2017). FERC’s action removes what had appeared to be an insurmountable impediment to construction of Millennium Pipeline Company, L.L.C.’s (Millennium) Valley Lateral Project, which has been delayed for nearly a year as Millennium has had to wait for the NYSDEC to act on its application for a CWA water quality certification (WQC). FERC’s action is significant because it demonstrates that the Commission will hold a state permitting agency exercising federally-delegated authority to the statutory timeframe, making it more difficult for a state agency to use its CWA authority to delay and ultimately to block natural gas infrastructure which FERC authorizes under the Natural Gas Act.

In recent years, interstate natural gas pipelines have increasingly encountered delays in obtaining permits from state and local agencies. In a number of cases, state permitting agencies have wielded their CWA authority to issue water quality certifications as a shield, demanding multiple application supplements, declaring that applications for WQCs are not complete (and hence that the statutory clock does not begin to run) until the state agency finds them complete, and ultimately denying the WQC altogether. In addition to Millennium’s Valley Lateral Project, the NYSDEC has denied CWA WQCs requested for the Northern Access Project proposed by National Fuel Gas Supply Corporation and Empire Pipeline, Inc. and for the Constitution Pipeline Project owned by subsidiaries of Williams Partners L.P., Cabot Oil & Gas Corporation, Piedmont Natural Gas Company, Inc., and WGL Holdings, Inc.