FERC Fails to Give Due Consideration to the Climate Change and Drilling Impacts of Pipeline Projects
(Download printable copy of “People’s Dossier of FERC Abuses: Climate Change and Drilling Impacts Ignored with attachments” here)
Despite the mandate of the National Environmental Policy Act (NEPA) that federal agencies take environmental considerations into account in their decision-making “to the fullest extent possible” (42 U.S.C. § 4332; 40 C.F.R. § 1500.2; Fla. Audubon Soc. v. Bentsen, 94 F.3d 658,684 (D.C. Cir.)) and FERC’s obligation under the Natural Gas Act (NGA) to protect the public interest, FERC routinely fails to meet its obligation to consider foreseeable impacts, both direct and indirect, resulting from its pipeline approvals, including effects on climate change, water impacts, air impacts, community impacts, and the ramifications of increased drilling and fracking operations.
FERC’s NEPA Requirements and Violations Regarding Climate Change Impacts
NEPA is our “basic national charter for protection of the environment.” 40 C.F.R. § 1500.1(a). As such, it makes environmental protection a part of the mandate of every federal agency. See 42 U.S.C. § 4332. (1) NEPA requires that federal agencies take environmental considerations into account in their decision-making “to the fullest extent possible.” 42 U.S.C. § 4332. Federal agencies must consider environmental harms and the means of preventing them in a “detailed statement” before approving any “major federal action significantly affecting the quality of the human environment.” Id. § 4332(2)(C). FERC must consider past, present and “reasonably foreseeable” cumulative impacts caused by its decisions and actions.
Construction and operation of fracked gas pipelines, compressors and infrastructure are a direct, indirect and foreseeable cause of increased greenhouse gas (GHG) emissions, increased drilling and fracking for gas from shale, and all the associated environmental impacts, including climate change, pollution, environmental degradation, and a variety of community and economic harms. NEPA requires FERC to consider these foreseeable direct and indirect impacts in its review of proposed natural gas infrastructure projects.
On August 1, 2016, The Council on Environmental Quality (CEQ) issued final Guidance for Federal Departments and Agencies on Consideration of Greenhouse Gas Emissions and the Effects of Climate Change in National Environmental Policy Act Reviews. This Guidance offered direction on how FERC and other agencies could consider the climate change impacts of its decisions. While this guidance has been rolled back by the Trump administration (Attch 1) the obligation to review the climate changing impacts of agency decision-making still exists as a mandate under NEPA. (Attch 2) The rollback of the guidance does not change the NEPA obligation to consider the climate changing impacts of pipeline infrastructure approvals.
Consideration of Downstream Impacts Ignored
The Court of Appeals for the DC Circuit in Sierra Club v. FERC, regarding the Sabal Trail Pipeline, made clear that an analysis of the downstream impacts of GHG emissions is reasonably foreseeable and required pursuant to NEPA. (2) It held that:
“… greenhouse-gas emissions are an indirect effect of authorizing this [pipeline] project, which FERC could reasonably foresee, and which the agency has legal authority to mitigate. See 15 U.S.C. § 717f(e). The EIS accordingly needed to include a discussion of the “significance” of this indirect effect, see 40 C.F.R. § 1502.16(b), as well as “the incremental impact of the action when added to other past, present, and reasonably foreseeable future actions,” see WildEarth Guardians, 738 F.3d at 309 (quoting 40 C.F.R. § 1508.7).” (3)
The obligation to consider the impacts of the downstream use of gas when approving pipeline projects, as made clear by the plain language of NEPA and the Sabal Trail decision, has been consistently circumvented by the Commission in its review and approval of pipeline projects. In a blatant refute of the Sabal Trail decision, the Commission issued the blanket determination that:
“… to avoid confusion as to the scope of our obligations under NEPA and the factors that we find should be considered under NGA section 7(c) […] the upstream production and downstream use of natural gas are not cumulative or indirect impacts of the proposed pipeline project, and consequently are outside the scope of our NEPA analysis.” (Attch 3)
However, this refusal to follow the law has come with regular dissenting opinions from both Commissioner Glick and Commissioner LaFleur, stating that:
“pipelines are driving the throughput of natural gas, connecting increased upstream resources to downstream consumption. With respect to downstream impacts, I believe it is reasonably foreseeable, in the vast majority of cases, that the gas being transported by pipelines we authorize will be burned for electric generation or residential, commercial, or industrial end uses. In those circumstances, there is a reasonably close causal relationship between the Commission’s action to authorize a pipeline project that will transport gas and the downstream GHG emissions that result from burning the transported gas. We simply cannot ignore the environmental impacts associated with those downstream emissions.” (4) (Attch 4)
In addition, the U.S. Environmental Protection Agency has explicitly commented that FERC should consider impacts from the development and production of natural gas being transported through a proposed pipeline, as well as impacts associated with the end use of the gas, particularly with regards to greenhouse gas emissions and climate change effects. (Attch 5)
Consideration of Upstream Impacts Ignored
FERC also comprehensively excludes from its NEPA review consideration of the GHG and other environmental harms that result from induced gas drilling, despite acknowledging that increased gas production will result from the pipeline construction it is reviewing and approving.
This failure to consider the impacts of induced shale gas production as well as the end uses of the fracked gas is particularly troubling given that FERC has explicitly recognized that “upstream development and production of natural gas may be a ‘reasonably foreseeable’ effect of a proposed action,” and that a new pipeline would “alleviate some of the constraints on…natural gas production”. (Attch 14) Despite these recognitions, and others, FERC asserts that “the actual scope and extent of potential GHG emissions from upstream natural gas production is not reasonably foreseeable” and therefore no consideration pursuant to NEPA is necessary. Through this circular logic of recognizing induced drilling but then discounting it because FERC has failed to assess the extent of the GHG emissions that will occur, FERC ignores its NEPA obligation to consider the impacts.
The direct and indirect connection between FERC’s approval of shale gas infrastructure and climate change impacts resulting from upstream production of shale gas has been recognized by at least two FERC commissioners. Commissioner Glick recently stated:
“It is particularly important for the Commission to use its “best efforts” to identify and quantify the full scope of the environmental impacts of its pipeline certification decisions given that these pipelines are expanding the nation’s capacity to carry natural gas from the wellhead to end-use consumers. Adding capacity has the potential to “spur demand” and, for that reason, an agency conducting a NEPA review must, at the very least, examine the effects that an expansion of pipeline capacity might have on production and consumption. Indeed, if a proposed pipeline neither increases the supply of natural gas available to consumers nor decreases the price that those consumers would pay, it is hard to imagine why that pipeline would be “needed” in the first place.” (Attch 7) (citations omitted)
The only reason why FERC deems such impacts unforeseeable is because the agency itself chooses to remain purposefully blind. This kind of doublespeak – that shale gas production is reasonably foreseeable but at the same time it is not reasonably foreseeable – is used by FERC to arbitrarily limit its review of impacts. In a recent order, FERC attempted to cement this contradictory policy in order to evade its legal review obligations by falsely asserting:
“Even if a causal relationship between the proposed action here and upstream production was presumed, the scope of the impacts from any such production is too speculative and thus not reasonably foreseeable.” (Attch 3)
However, as Commissioner Glick clarified in his dissent:
“The fact that the pipeline’s exact effect on the demand for natural gas may be unknown is no reason not to consider the type of effect it is likely to have. As the United States Court of Appeals for the Eighth Circuit explained in Mid States—a case that also involved the downstream emissions from new infrastructure to transport fossil fuels—“if the nature of the effect” (i.e., increased emissions) is clear, the fact that “the extent of the effect is speculative” does not excuse an agency from considering that effect in its NEPA analysis.” (Attch 7)
In fact, the relationship between FERC approved pipeline projects and upstream production is foreseeable, direct and demonstrable, as the Delaware Riverkeeper Network has demonstrated on the PennEast pipeline docket. For example, in the case of the PennEast Pipeline (FERC Docket CP15-558) FERC failed to consider the emissions and other harms that will result from the shale gas production necessary to fulfill the claimed “need” for the project and to carry the volumes of gas proposed. The PennEast pipeline will likely induce the drilling of 3,000 new wells in Northeast Pennsylvania, in Bradford, Susquehanna, Lycoming, and Tioga counties. (Attch 8) Given recent estimates that “during the life cycle of an average shale-gas well, 3.6 to 7.9% of the total production of the well is emitted to the atmosphere as methane” (1), this failure to consider the GHG and climate changing impacts of the induced drilling operations and end uses of the gas these pipelines deliver is significant.
It is not just climate change that induced drilling and fracking operations seriously affect. Fracking operations are known to have severe impacts on water quality including drinking water, air quality, property values, human health, public parks, farming and land use patterns. These impacts are known, quantifiable, and scientifically demonstrated through peer review articles. For example, the Compendium of Scientific, Medical, and Media Findings Demonstrating Risks and Harms of Fracking (5) is a fully updated and referenced scientific resource that can be used to assess the many direct and indirect effects of pipeline-induced-fracking.
FERC’s self-inflicted ignorance on the subject does not alleviate the agency of its obligation to undertake an assessment of greenhouse gas emissions and other environmental and community impacts resulting from induced shale gas production associated with the infrastructure projects it reviews and approves.
Natural Gas Act Requirements Violated
In addition to the requirements of NEPA, the NGA requires FERC to consider the climate changing ramifications of its pipeline and infrastructure decisions. As required by the NGA, FERC must consider “all factors bearing on the public interest,” and, prior to issuing a certificate for new pipeline or compressor station construction, must find the project’s benefits outweigh its harms. Given that:
- science conclusively demonstrates that human release of greenhouse gas emissions including methane are a direct cause of climate change,
- natural gas pipelines and compressors are directly and indirectly a source of climate changing emissions,
- climate change has serious and significant environmental, economic and safety impacts, and
- as a result of its harmful impacts on our communities and environment, climate change poses one of the most extreme existential threats facing humanity,
FERC’s consideration of the impacts resulting from the GHG of shale gas pipelines and compressors are clearly required as a result of the NGA.
The United Nations IPCC Report and the US 4th National Climate Assessment all make clear the grave consequences of climate change and reaching a 1.5 degree tipping point – the ramifications are to health, safety, our environment and our economy. NASA has determined, through its data gathering and research, that methane is responsible for about a quarter of the human induced climate effects and that the fossil fuel industry is responsible for most of the dramatic rise in methane emissions in the past 10 years. (6) Pipelines and fracking are a big part of this equation. FERC’s refusal to consider the GHG emissions and the climate changing impacts, as well as other environmental harms associated with approval of pipelines, compressor stations and related infrastructure, brings with it dire consequences for the public interest of our communities and nation.
Commissioner Glick has clearly outlined FERC’s NGA mandate to consider climate change impacts resulting from its actions and decisions in recent statements:
“Climate change poses an existential threat to our security, economy, environment, and, ultimately, the health of individual citizens. Unlike many of the challenges that our society faces, we know with certainty what causes climate change: It is the result of GHG emissions, including carbon dioxide and methane, which can be released in large quantities through the production and consumption of natural gas. Congress determined under the NGA that no entity may transport natural gas interstate, or construct or expand interstate natural gas facilities, without the Commission first determining the activity is in the public interest. This requires the Commission to find, on balance, that a project’s benefits outweigh the harms, including the environmental impacts from climate change that result from authorizing additional transportation. Accordingly, it is critical that, as an agency of the federal government, the Commission comply with its statutory responsibility to document and consider how its authorization of a natural gas pipeline facility will lead to the emission of GHGs, contributing to the existential threat of climate change.” (Attch 9)
Commissioner LaFleur has also referred to this legal obligation in recent statements:
“…deciding whether a project is in the public interest requires a careful balancing of the economic need for the project and all of its environmental impacts. Climate change impacts of GHG emissions are environmental effects of a project and are part of my public interest determination.” (Attch 4) (citations omitted)
FERC’s Refusal to Consider the Social Cost of Carbon in Its Climate Change Analysis
Despite its claim to the contrary, FERC has many tools that would allow it to consider the climate changing ramifications of its pipeline decisions. Among the most readily available is the social cost of carbon. Despite court mandate, FERC has refused to avail itself of information and tools such as these to aid in its project reviews.
The social cost of carbon (SCC)— “a measure, in dollars, of the long-term damage done by a ton of carbon dioxide (CO2) emissions in a given year” (7)—is a tool that would allow FERC to measure economic impacts of climate change that would result from proposed pipelines as required by its NEPA and NGA mandates. Despite the fact that a federal court recently upheld the legitimacy of using the social cost of carbon as a viable statistic in climate change regulations, (8) and that the CEQ had recommended its use in its final guidance for federal agencies to consider climate change when evaluating proposed Federal actions, (Attch 2) the Commission continues to contend that it “‘has not identified a suitable method’ for determining the impact from the Projects’ contribution to climate change and, absent such a method, it simply ‘cannot make a finding whether a particular quantity of [GHG] emissions poses a significant impact on the environment and how that impact would contribute to climate change.’” (Attch 9)
However, as Commissioners Glick and LaFleur have pointed out in response to multiple recent certificate order decisions, FERC is incorrect in its claims that there is “no widely accepted standard to ascribe significance to a given rate or volume of GHG emissions” (9) and that “it cannot ‘determine how a project’s contribution to GHG emissions would translate into physical effects on the environment.’” (Attch 10) As Commissioner Glick explains: (Attch 11)
“That is precisely what the Social Cost of Carbon provides. It translates the long-term damage done by a ton of carbon dioxide into a monetary value, thereby providing a meaningful and informative approach for satisfying an agency’s obligation to consider how its actions contribute to the harm caused by climate change.” (10)
“the Commission has the tools needed to evaluate the Projects’ impacts on climate change. It simply refuses to use them.” (Attch 13)
Despite these clear mandates from NEPA, the Natural Gas Act, and the Courts, FERC continues to illegally narrow its consideration of climate change and the other community and environmental ramifications of its pipeline, compressor and related infrastructure decisionmaking.
(1) See R. Howarth, D Shindell, R. Santoro, A. Ingraffea, N. Phillips, A Townsend-Small, Methane Emissions from Natural Gas Systems, Background Paper Prepared for the National Climate Assessment, Reference number 2011-0003, Feb. 25, 2012.
(2) See Sierra Club v. FERC, 867, F.3d 1357, 1373 (D.C. Cir. 2017)(““… greenhouse-gas emissions are an indirect effect of authorizing this [pipeline] project, which FERC could reasonably foresee, and which the agency has legal authority to mitigate. See 15 U.S.C. § 717f(e). The EIS accordingly needed to include a discussion of the “significance” of this indirect effect, see 40 C.F.R. § 1502.16(b), as well as “the incremental impact of the action when added to other past, present, and reasonably foreseeable future actions,” see WildEarth Guardians, 738 F.3d at 309 (quoting 40 C.F.R. § 1508.7). “)
(3) See decision rendered by the Court of Appeals for the DC Circuit on August 22, 2017 in Sierra Club v. FERC, 867, F.3d 1357, 1373 (D.C. Cir. 2017).
(4) See Footnote Number 6 in Statement of Commissioner Cheryl LaFleur on Millennium Pipeline, FERC Docket No. CP16-486, July 24, 2018.
(5) See Compendium of Scientific, Medical, and Media Findings Demonstrating Risks and Harms of Fracking, Physicians for Social Responsibility, March 2018, available at: https://concernedhealthny.org/wp-content/uploads/2018/03/Fracking_Science_Compendium_5FINAL.pdf
(6) See Nasa Led Study Solves a Methane Puzzle, NASA, January 2, 2018, available at: https://www.nasa.gov/feature/jpl/nasa-led-study-solves-a-methane-puzzle
(7) See EPA Fact Sheet, Social Cost of Carbon, December 2016, available at: https://www.epa.gov/sites/production/files/2016-12/documents/social_cost_of_carbon_fact_sheet.pdf
(8) See Susanne Brooks, Environmental Defense Fund, In Win for Environment, Court Recognizes Social Cost of Carbon, August 29, 2016, available at: http://blogs.edf.org/markets/2016/08/29/in-win-for-environment-court-recognizes-social-cost-of-carbon/
(9) Id. P 27. Florida Southeast Connection, LLC, 162 FERC ¶ 61,233, at 2, 5–8 (2018) (Glick, Comm’r, dissenting).
(10) Id. at 5 (Glick, Comm’r, dissenting) (citing cases that discuss the Social Cost of Carbon when evaluating whether an agency complied with its obligation under NEPA to evaluate the climate change impacts of its decisions).
Complete People’s Dossier: FERC’s Abuses of Power and Law
available here.
