FERC has waived New York’s authority to issue Constitution Pipeline a Section 401 water quality certification (WQC) under the Clean Water Act (CWA), breathing new life into a project that has been delayed for years.
In an order issued late Wednesday, the Federal Energy Regulatory Commission unanimously voted to reverse a decision it made last year, when it refused to waive the state’s authority. The turnabout follows a ruling from the U.S. Court of Appeals for the District of Columbia.
Ultimately, the Commission found that the New York State Department of Environmental Conservation (DEC) took too long to issue a decision on Constitution’s WQC application by exceeding the CWA’S one-year statutory timeframe.
DEC may now seek rehearing of the latest order or move for judicial review. Constitution also may file notices to proceed (NTP) with construction, but the project is still likely to face a slow path forward.
Sponsors “are evaluating the next steps for advancing the project,” said Constitution spokesman Christopher Stockton. Those steps include coordinating with other permitting agencies to secure additional approvals needed to obtain NTPs from FERC. The “principal outstanding permit,” he said, is the Section 404 authorization from the U.S. Army Corps of Engineers.
The DEC denied the WQC and brought the project to a halt three years ago after it said Constitution’s application was incomplete. The agency has since denied certifications for other natural gas pipelines. Last year, FERC waived New York’s authority to issue a WQC for the Northern Access expansion project, which now is targeting service by 2023 after years of delay.
Constitution had appealed FERC’s previous decision to the DC Circuit, but the Commission earlier this year asked the court to remand the matter after a three-judge panel ruled on an unrelated hydropower project. In that case, Hoopa Valley Tribe v. FERC et al, No. 14-1271, the appeals court ruled that California did not have the authority to direct project sponsors to withdraw and resubmit WQC applications to prolong the state’s review time.
Constitution has battled the DEC since 2016, when after nearly three years of regulatory review, the WQC was denied. The project sponsors had filed for a WQC in August 2013, but the application was withdrawn and resubmitted twice, which DEC argued reset the one-year deadline it had to make a decision each time.
Citing the Hoopa Valley case, FERC reversed its decision and waived the state’s authority. The decision also comes at a time when the EPA has proposed revisions to Section 401 of the CWA, aimed at curbing the type of prolonged reviews states like New York have conducted before eventually rejecting natural gas infrastructure projects.
“While the proposed revisions to the CWA 401 have drawn criticism from some states and many environmental and landowner advocates ahead of the official comment deadline -- including on this issue -- [the] unanimous order appears to clearly indicate that FERC also considers the withdraw and resubmit issue fully settled by the DC Circuit’s ruling in Hoopa Valley,” said ClearView Energy Partners LLC in a note to clients.
FERC’s unanimous stance on the issue is also unusual in that the Commission is currently deadlocked with two Republicans and two Democrats. Commissioners have more recently failed to meet eye to eye on issues such as climate change. While the Commission indicated earlier this year that it would reconsider the Constitution decision, it was unclear exactly how long that might take given that other key decisions, such as certificate approvals, have been delayed.
In its Wednesday order, FERC rejected DEC’s argument that the Hoopa Valley case is vastly different than Constitution’s. The agency also had requested a stay of any decision while it contemplated a new WQC for the project. FERC denied that request.
The order comes after Constitution has suffered multiple defeats in challenging DEC’s denial, including those before the U.S. Court of Appeals for the Second Circuit and the U.S. Supreme Court.
The 124-mile pipeline would carry 650 MMcf/d of Appalachian gas from Susquehanna County, PA, to an interconnect with the Iroquois Gas Transmission and Tennessee Gas Pipeline systems in Schoharie County, NY. The project is backed by Williams, Cabot Oil & Gas Corp., Piedmont Natural Gas and WGL Holdings Inc.