FERC To Natural Gas Pipeline Industry: What about Environmental Justice?

Holland & Knight LLP

Holland & Knight LLP

The Federal Energy Regulatory Commission (FERC) recently invited public comment on environmental justice matters it may consider in future natural gas pipeline certificate proceedings, reopening a three-year-old notice and comment process with new social justice issues.

On April 19, 2018, the FERC issued a Notice of Inquiry (Original Notice), inviting stakeholders in the natural gas industry and interested parties to comment on revising the 1999-issued Certification of New Interstate Natural Gas Pipeline Facilities – Statement of Policy (Policy Statement).

On Feb. 18, 2021, almost three years and more than 3,000 public comments later, the FERC  issued a second Notice of Inquiry (2021 Notice), seeking to refresh the record with supplementary information and raising environmental justice issues for the first time.

Significance of Policy Statement

The Policy Statement is a pivotal component in the process of developing interstate natural gas pipeline infrastructure. Pursuant to Section 7 of the Natural Gas Act, an interstate natural gas company must obtain a certificate of public convenience and necessity (CPCN) from the FERC before it can 1) construct, operate or acquire a natural gas facility or 2) transport or sell natural gas in interstate commerce. Moreover, the Policy Statement provides the framework for the FERC to evaluate and grant a CPCN to an interstate natural gas company.

The Original Notice, the 2021 Notice and the Public Good Addition

In the Original Notice, the FERC requested comment in four areas related to proposed projects:

1. Determination of Need: the process for examining project need, including reliance on precedent agreements

2. Eminent Domain and Landowner Interests: the potential exercise of eminent domain and of landowner interests

3. Environmental Impacts: its analysis of environmental impacts

4. Review Process: the efficiency and effectiveness of the certification cycle, including pre-filing, post-filing and post-order issuance

In the 2021 Notice, however, the FERC requested comment on an additional topic concerning public good and, specifically, environmental justice:

5. Environmental Justice: the approach for 1) identifying environmental justice communities potentially subject to disproportionate adverse health impacts or environmental effects and 2) mitigating the negative effects.

The 2021 Notice proceeds to define an "environmental justice community" as any group of people, such as 1) populations of color, 2) communities of color, 3) Native communities and 4) low-income rural and urban communities, exposed to a disproportionate level of negative health and environmental impacts. The 2021 Notice also references President Joe Biden's Executive Order 14008, which instructs federal agencies to develop "programs, policies, and activities to address the disproportionately high and adverse human health, environmental, climate-related and other cumulative impacts on disadvantaged communities, as well as the accompanying economic challenges of such impacts."  

The request for comment on environmental justice demonstrates an interest by the FERC in gaining perspective on a topic that has gained significant traction in the recent decade. Under the Biden Administration, it appears the conversation surrounding environmental justice is here to stay, but whether comments on the 2021 Notice will garner any revisions to the Policy Statement remains to be seen.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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