Political differences in greenhouse gas emissions sparked a tense public debate over two seemingly mundane orders for natural gas certificates during last week’s FERC meeting.
A last-minute procedural move by Commissioner James Danly to amend the infrastructure expansion orders proposed by Northern Natural Gas (NNG) and Tuscarora Gas Transmission Co. appeared to surprise Chairman Richard Glick. The subsequent back and forth pointed to an ideological gap in the Federal Energy Regulation Commission with regard to the agency’s approach to regulating the natural gas infrastructure.
Pipeline companies could bridge this political divide if FERC updates its 1999 Policy Statement on Natural Gas Allowance Orders. The emerging revisions will almost certainly reflect broader policies to tackle climate change, with signs suggesting that it will become more difficult to get approval from the Agency for future expansion of natural gas capacity.
“For informational purposes only”
FERC eventually voted to approve the two orders during its meeting. One was a proposal from Tuscarora to replace a unit at Wadsworth Compressor Station in Nevada. The other was to add 45,693 Dth / d to the Minnesota NNG system.
Danly, along with Republican Commissioners Neil Chatterjee and Mark Christie, voted in favor. Glick and Commissioner Allison Clements, both Democrats, partially agreed and partially disagreed.
Clements and Glick agreed that both projects were necessary, but argued that any decision deserved a supplementary Environmental Impact Statement “to study the impact of the greenhouse gas emissions generated by the project on climate change”.
At first, it appeared that neither order would get the three votes required to get it passed. Then Danly added a single sentence to the commands, which he said were “legally frail and … even just unfair” as designed.
“The above analysis of greenhouse gas emissions is provided for informational purposes only, does not inform any part of the inventory of this order and does not serve as a precedent for any future certificate order,” states the Danish amendment.
Danly and Christie believe that changes to FERC’s GHG emissions analysis should be made as part of the Notice of Inquiry, opened earlier this year to update the 1999 Policy Statement, rather than as part of a single project document this provides for more restricted participation.
On the flip side, the Commission’s Democrats have long been in favor of reform on this issue following a 2017 federal court ruling finding that FERC failed to adequately account for greenhouse gas emissions in a review of three natural gas pipelines.
‘This is not a game’
Glick, Chatterjee, and Clements appeared to be reluctant to use the way Danly proposed his amendment, which suggested it should have been proposed before the meeting.
“I would like to point out that I think your application is not in order,” Glick told Danly. “You have not provided a copy of the amendment. I didn’t know you would apply. I spoke to you many times “before the meeting. “You didn’t mention it a single time. You haven’t shared it with anyone. “
While the request for change clearly took the other commissioners by surprise, Danly defended the move on procedural grounds.
“This is an advisory body, and the whole idea of an advisory body is to share and find a solution to the issues that lie ahead,” said Danly. “… The fact that we are going to discuss this is known to the public. And I should like to point out that, before the prepared speeches and wooden performances of today’s meetings of the Commission, it was customary to process orders in real time and to make amendments during the meeting in real time. ”
Without expressing major problems with the language of the amendment itself, however, Clements and Chatterjee, like Glick, appeared to have problems with the timing of its introduction.
“This is not a game,” said Chatterjee. “People watch this. The markets are watching this. We play with these companies. If that sentence had been what it took to get us the three votes, it should have been offered before the meeting.
“… I appreciated the back and forth and the debate. I can’t stress enough that these kinds of methods and tactics – look, I’ve been doing them all along in the United States Senate. That is different. This is a regulator. Our words are important and our actions are important, and I am very frustrated with how this all went. “
For her part, Clements said that complying with FERC’s legal obligations under the National Environmental Policy Act “is too serious to be implicated in this surprise amendment” proposed by Danly.
“I wish I had believed this amendment was made in good faith,” said Clements.
Christie said his priority was to move the projects forward and save the greenhouse gas emissions policy debate for the NOI process.
“There are five members who agree that these projects are needed and we want to remind ourselves why: people can heat their homes and not freeze in winter, so people can cook with gas stoves, so people with gas water heaters can get hot can water, ”said Christie. “These are needed projects. It is not a bureaucratic exercise. Real people need these projects, so we as a commission have to deliver. “
He emphasized the NOI as a forum for developing reforms of the FERC guideline to review greenhouse gas emissions.
“The clear and obvious purpose of the NOI, which we unanimously approved, was to resolve the GHG issue in this general process going forward,” said Christie. “And a general process was the appropriate place to do this, because in a general process anyone who has an interest in, any group, any industrial trade association, any environmental association has the right to comment. And vice versa, not to do it in these individual proceedings, in which there is only limited participation. “
“Today was unacceptable”
The regulatory response to climate change could cause profound changes in the way the agency, primarily responsible for overseeing the country’s natural gas pipeline network, conducts its business. The virtual format of last week’s debate, in which the Commissioners’ physical distance reflected their apparent ideological separation, was once again a subtle reminder that FERC is entering a new era.
According to analysts at ClearView Energy Partners LLC, FERC’s stance on greenhouse gas emissions and their impact on natural gas pipeline companies remains uncertain for the time being.
After reviewing the orders, ClearView analysts said they were “at a loss as to why” Glick “initially pointed out that orders were not moving forward … or why” Danly “insisted on a real-time change”.
According to ClearView, “We still think that Commissioner Danly’s request to change these certificates may result in more than less procedural delays for other pending certificate approvals, especially those where opponents have criticized the FERC’s greenhouse gas assessment.”
ClearView analysts told clients after the meeting that they at FERC “believe that we believe that project approvals may be slowing”. “In the near future, there may be only a few, if any, new certificate approvals. Indeed, some projects may have to wait for the Commission to complete the fuller review of their statement on the Certificates Directive. “
After the orders from Tuscarora and NNG passed and last week’s meeting came to an end, Glick again stated that he disapproved of Danly’s tactics. This led to a renewed exchange between two commissioners who had a fair share of disagreement on file.
“I don’t think we should be deceived,” said Glick. “We have to talk to our colleagues about what we’re up to. I plan to work with my colleagues to smooth the road a bit to see if we can move forward better, but I think today was unacceptable. “
Danly refuted.
“The Chairman’s comments imply that I was mistaken in getting this to speak and I want to refute that. There can be no deception in having an amendment offered in a full daylight session on the file I submit for my colleagues to consider, ”said Danly.
“Any internal dialogue and discussion that takes place behind closed doors and over which the public has no control is not always conducted with the goodwill that one could hope for. And sometimes you have to insist that the open meeting is the forum where the real discussion takes place, ”added the Commissioner. “I regret the fact that I had to do this, but I did. I had to. “
Comments are closed.