Commissioner James Danly Statement
October 20, 2022
CP21-1-000 and CP21-458-000
I concur in the decision to grant Golden Pass Pipeline LLC’s (Golden Pass) applications under Natural Gas Act (NGA) section 7[1] to amend its certificate of public convenience and necessity that was issued on December 21, 2016.[2]
There are any number of problems with this order: we should not have exceeded the limits of our authority under the NGA,[3] we should have repudiated Northern,[4] and we should not have included Social Cost of Carbon calculations in this proceeding’s environmental document.[5] All of these issues have been thoroughly canvassed in my concurrently-issued separate statement in Texas Gas Transmission, LLC[6] and in many earlier separate statements and need not here be repeated at length.
Instead, I want to focus on one single issue: the unnecessary and unjustifiable delays suffered by this applicant for nearly two years.
The mere fact that the Commission is issuing a section 7 authorization after long and inexplicable delay is, regrettably, nothing new. I have written separately on numerous occasions regarding my concerns with a recurring pattern of delayed action on NGA authorizations. For example, I recently wrote separately regarding my concern with the delays in acting on another amendment to Golden Pass’s December 2016 Certificate.[7] This proceeding is yet another example. Golden Pass filed its applications in Docket No. CP21-1-000 on October 2, 2020 and in Docket No. CP21-458-000 on June 11, 2021.
Let’s begin with the application in the first of the two dockets in this order, Docket No. CP21-458-000. That application was noticed on June 23, 2021.[8] Then, the Commission waited until November 5, 2021 to issue a Notice of Intent to Prepare an Environmental Impact Statement (EIS).[9] As a reminder, the Commission’s regulations provide that “[f]or each application that will require an environmental assessment or an environmental impact statement, notice of a schedule for the environmental review will be issued within 90 days of the notice of the application, and subsequently will be published in the Federal Register.”[10] The notice was issued 135 days after the amendment application was noticed, i.e., 45 days late. And no data request was issued in the docket during the time prior to the Commission’s announcement that it would prepare an EIS.
Turning to the second application, the one filed in Docket No. CP21-1-000, that amendment application was noticed on October 19, 2020.[11] On November 19, 2020, the Commission issued a notice of scoping period and requested comments.[12] The notice requested “comments on the scope of issues to address in the environmental document,” established a comment deadline of December 19, 2020, and stated that “[f]ollowing this scoping period, Commission staff will determine whether to prepare an Environmental Assessment (EA) or an Environmental Impact Statement (EIS).”[13] On December 9, 2020, the Commission issued a notice of schedule for the preparation of an EA with a scheduled issuance for the EA of February 26, 2021.[14] On February 26, 2021, nothing was issued.[15] No EA. No notice of a revised schedule. Subsequently, the Commission’s Office of Energy Projects issued an environmental information request on March 9, 2021, requesting information including air quality modeling, estimates of hazardous air pollutants, the construction timeline, maps and aerial photographs including specific locations where all interconnects will be constructed for the Amendment.[16] 252 days after the date the EA was scheduled for issuance, i.e., November 5, 2021, the Commission issued a notice of intent to prepare an EIS and the schedule for the Final EIS provided for a June 24, 2022 issuance date.[17] The Commission issued the Final EIS on that date, i.e., 483 days after the Commission’s prior schedule to issue the originally-planned EA. What was the need to prepare an EIS instead of an EA?[18] Why was the Commission unable to meet its originally planned schedule for the EA? Why did the Commission wait 252 days after the scheduled date for the EA to declare it was instead preparing an EIS? These questions are all unanswered. And the industry is frustrated with the Commission[19]—for good reason. For the application in Docket No. CP21-1-000, Golden Pass requested that the Commission act on the application by May 1, 2021.[20] We are acting 537 days later. For the application in Docket No. CP21-458-000, Golden Pass requested that the Commission act on the application by January 1, 2022.[21] We are acting 292 days later. Golden Pass stated in March 2022 that “[t]he delays . . . have jeopardized [Golden Pass’s] ability to construct and timely place in-service the facilities needed to receive gas from the Enable Gulf Run system currently under construction, and [Golden Pass’s] ability to transport commissioning gas to the Golden Pass LNG Export Terminal facilities under construction.”[22] I have appended to my statement a letter from Golden Pass that discusses the procedural history and inexplicable delay in these two dockets.
I cannot imagine anyone offering sincere justification for these delays. They are unjustifiable and cause great harm. I have said it before—repeatedly—and I will say it again: the cost of delays in processing NGA section 7 applications are profound.[23] Delay results in greater project expense and difficulty securing capital on acceptable terms. Uncertainty around timelines increases risk premiums and makes it harder to rationally allocate capital in this capital-intensive industry. This further chills investment and impairs the development of an industry the Commission is charged with promoting.[24] Especially now, when certain regions face desperate shortages of natural gas, we should not be subjecting these applications to such haphazard delay.
For these reasons, I respectfully concur in the judgment.
APPENDIX
[1] 15 U.S.C. § 717f.
[2] Golden Pass Prods. LLC, 157 FERC ¶ 61,222 (2016) (December 2016 Certificate).
[3] See, e.g., Tex. Gas Transmission, LLC, 181 FERC ¶ 61,049 (2022) (Danly, Comm’r, concurring in the judgment at P 2).
[4] Id. (Danly, Comm’r, concurring in the judgment at P 4); see N. Nat. Gas Co., 174 FERC ¶ 61,189 (2021) (Northern).
[5] Id. (Danly, Comm’r, concurring in the judgment at P 8).
[6] 181 FERC ¶ 61,049.
[7] See Golden Pass LNG Terminal LLC, 180 FERC ¶ 61,058 (2022) (Danly, Comm’r, concurring in the judgment).
[8] Commission June 23, 2021 Notice of Application for Amendment and Establishing Intervention Deadline re Golden Pass Pipeline, LLC under CP21-458.
[9] Commission November 5, 2021 Notice of Intent to Prepare an Environmental Impact Statement for the Proposed MP66-69 Compression Relocation and Modification Amendment etc. re Golden Pass Pipeline Company, LLC under CP21-1 et al.
[10] 18 C.F.R. § 157.9(b).
[11] Commission October 19, 2020 Notice of Application and Establishing Intervention Deadline re Golden Pass Pipeline LLC under CP21-1.
[12] Commission November 19, 2020 Notice of Scoping Period Requesting Comments on Environmental Issues for the Proposed Compression Relocation and Modification Project re Golden Pass Pipeline LLC under CP21-1.
[13] Id. at 1, 4.
[14] Commission December 9, 2020 Notice of Schedule for the Preparation of an Environmental Assessment for the Compression Relocation and Modification Project re Golden Pass Pipeline LLC under CP21-1.
[15] Perhaps the environmental document was delayed, in part, once staff became aware that there was a related amendment in Docket No. CP21-458-000. I pause to note though that the EA for Docket No. CP21-1-000 was scheduled for issuance prior to the application in Docket No. CP21-458-000 being filed.
[16] Commission Staff March 9, 2021 Letter requesting Golden Pass Pipeline, LLC to file a response to environmental information request within 10 days to assist in FERC's analysis of the certificate application for the Compression Relocation & Modification Project, CP21-1.
[17] Commission November 5, 2021 Notice of Intent to Prepare an Environmental Impact Statement for the Proposed MP66-69 Compression Relocation and Modification Amendment etc. re Golden Pass Pipeline Company, LLC under CP21-1 et al.
[18] I note that my colleagues can point to no court decision finding that the Commission should have determined the significance of the greenhouse gas (GHG) emissions or that the Commission should have prepared an EIS due to its inability to determine the significance of GHG emissions. No such judicial decision exists. We therefore have no such obligation. Nor has there ever been a remand or vacatur of a certificate order on that basis.
[19] See, e.g., March 22, 2022 Comments of Golden Pass Pipeline LLC on Chairman Glick’s March 11, 2022 Letter to Representatives McMorris-Rodgers and Upton under CP21-1 et. al., at 1-2 (“[Golden Pass] submits this letter to correct the inaccuracies and omissions in the table, all of which tend to minimize the unwarranted, extensive delays in granting the necessary authorizations, and the consequent uncertainty caused by the extended, opaque approval process. These applications have been pending far too long.”) (Golden Pass March 22, 2022 Comments); id. at 6 (“The delay in granting the amendment authorization is unwarranted and contrary to the public interest.”); id. at 7 (“[Golden Pass] urges the Commission to expedite action on [Golden Pass’s] pending amendment applications, and to examine and improve the transparency and fairness of its certificate application procedures.”).
[20] Golden Pass Amendment Application, Docket No. CP21-1-000 at 2 (Oct. 2, 2020).
[21] Golden Pass Amendment Application, Docket No. CP21-458-000 at 1 (June 11, 2021).
[22] Golden Pass March 22, 2022 Comments at 6-7.
[23] See, e.g., Nat’l Grid LNG, LLC, 179 FERC ¶ 61,205, at PP 5-7 (2022) (explaining that although National Grid LNG, LLC “planned to begin construction of the project at the end of 2016[,] . . . it did not receive certificate authorization until October 2018,” and therefore it requested an increase in its initial recourse rates since the estimated cost of the facilities increased from $180,256,679 to $390,829,000—a difference of $210,572,321—as a result of increased construction costs due to the timing change and construction work plan changes). Cf. Duke Energy, Dominion Energy and Duke Energy cancel the Atlantic Coast Pipeline (July 5, 2020), https://news.duke-energy.com/releases/dominion-energy-and-duke-energy-cancel-the-atlantic-coast-pipeline (announcing Dominion Energy’s and Duke Energy’s cancellation of the Atlantic Coast Pipeline Project—a project with a Commission-issued certificate of public convenience and necessity—due to “ongoing delays and increasing cost uncertainty which threaten[ed] the economic viability of the project” and explaining that the project faced many challenges, including: (1) adverse court decisions regarding their federal permit for waterbody and wetland crossings (Nationwide Permit 12), which led to uncertainty in the companies’ investment; and (2) “legal challenges to the project’s federal and state permits[,] . . . [which] caused significant project cost increases and timing delays” and resulted in an estimated “project cost . . . increase[] to $8 billion from the original estimate of $4.5 to $5.0 billion” as well as an estimated delay of “three-and- a-half-year[s]” for the project’s in-service date).
[24] See NAACP v. FPC, 425 U.S. 662, 669-70 (1976) (recognizing that the purpose of the NGA is to “encourage the orderly development of plentiful supplies of . . . natural gas at reasonable prices”) (citations omitted).