Commissioner Richard Glick Dissent in Part Regarding Sendero Carlsbad Gateway, LLC

Commissioner Richard Glick Statement

October 10, 2019

Docket No. CP18-538-000

Dissent in Part of Commissioner Richard Glick Regarding Sendero Carlsbad Gateway, LLC

I dissent in part from today’s order because it violates both the Natural Gas Act 1 (NGA) and the National Environmental Policy Act 2 (NEPA).  The Commission again refuses to consider the consequences its actions have for climate change.  Neither the NGA nor NEPA permit the Commission to assume away the climate change implications of constructing and operating this project.  Yet that is precisely what the Commission is doing here.

Today’s order authorizes Sendero Carlsbad Gateway, LLC (Gateway) to construct and operate the Gateway Project (Project), a 23-mile pipeline that will transport residue gas from  a processing plant owned by a Gateway affiliate to a downstream interconnection point in order to access regional markets. 3   However, in so doing, the Commission continues to treat greenhouse gas (GHG) emissions and climate change differently than all other environmental impacts.  In today’s decision, the Commission refuses to consider whether the Project’s contribution to climate change would be significant, even though it quantifies the direct GHG emissions from the Project’s construction and operation.  Moreover, the Commission fails to consider the Project’s contribution to climate change from downstream GHG emissions.  The refusal to assess the significance of the Project’s direct and indirect contribution to the harm caused by climate change is what allows the Commission to misleadingly state that approval of the Project “would not constitute a major action significantly affecting the quality of the human environment” 4 and, as a result, conclude that the Project satisfies the NGA’s public interest standard. 5   Claiming that a project has no significant environmental impacts while at the same time refusing to assess the significance of the project’s impact on the most important environmental issue of our time is not reasoned decisionmaking.

The Commission’s Public Interest Determination Is Not the Product of Reasoned Decisionmaking

We know with certainty what causes climate change:  It is the result of GHG emissions, including carbon dioxide and methane, released in large quantities through the production, transportation, and the consumption of fossil fuels, including natural gas.  The Commission’s environmental documents routinely recognize this fact, acknowledging that “GHG emissions due to human activity are the primary cause of increased atmospheric concentration of GHGs since the industrial age and are the primary contributor to climate change.” 6   In light of this undisputed relationship between anthropogenic GHG emissions and climate change, it is critical that the Commission carefully consider the Project’s contribution to climate change, both in order to fulfill NEPA’s requirements and to determine whether the Project is in the public interest and required by the public convenience and necessity under the NGA. 7

Today’s order falls short of that standard.  As part of its public interest determination, the Commission must examine the Project’s impact on climate change. 8   Nevertheless, the Commission insists that it need not consider whether the Project’s contribution to climate change is significant because it lacks a “generally accepted” means to do so, or so it claims. 9   Although that conclusion is dubious in its own right, 10 the most troubling part of the Commission’s rationale is what comes next.  The Commission uses the purported inability to evaluate the significance of the impact from climate change as a basis to wholly exclude that impact from its public interest determination.  Based on its alleged inability to assess the significance of the Project’s impact on climate change, the Commission concludes that the Project will have no significant environmental impact. 11   Think about that.  The Commission is saying out of one side of its mouth that it cannot assess the significance of the Project’s impact on climate change 12 while, out of the other side of its mouth, assuring us that all environmental impacts are not significant. 13  That is ludicrous, unreasoned, and an abdication of our responsibility to give climate change the “hard look” that the law demands.14

The consequences of the Commission’s approach extends beyond any single proceeding.  This approach means that the volume of GHG emissions caused by a project does cannot play a meaningful role in the Commission’s public interest determination, no matter how many times the Commission assures us that it does.  Using the approach in today’s order, the Commission will always conclude that a project will not have any significant environmental impact irrespective of the project’s actual GHG emissions or those emissions’ impact on climate change.  So long as that is the case, a project’s impact on climate change cannot, as a logical matter, play a meaningful role in the Commission’s public interest determination.  A public interest determination that systematically excludes the most important environmental consideration of our time is contrary to law, arbitrary and capricious, and not the product of reasoned decisionmaking.

The Commission’s NEPA Analysis of the Project’s Contribution to Climate Change Is Deficient

The Commission’s NEPA analysis of the Project’s impact on climate change is similarly flawed.  NEPA requires the Commission to examine the reasonably foreseeable upstream and downstream emissions that will result from an interstate pipeline.  The U.S. Court of Appeals for the District of Columbia Circuit (D.C. Circuit) has now multiple times instructed the Commission thatthe GHG emissions caused by the reasonably foreseeable combustion of natural gas transported through a pipeline is an indirect effect. 15   Yet today’s order fails to consider any of the Project’s indirect impacts, instead reporting only the GHG emissions from the Project’s construction and operation. 16   In particular, neither today’s order nor the EA considers whether there are any indirect GHG emissions caused by the Project, which will create the capacity to transport up to 400 million standard cubic feet per day of natural gas. 17   Indeed, today’s order makes no effort whatsoever to identify the downstream GHG emissions that are indirect impacts caused by the Project. 

The failure to consider those impacts reflects a continuation of the Commission’s discredited attempt to narrowly cabin the D.C. Circuit’s decision in Sabal Trail to its facts.  In Sabal Trail, the court held that the Commission must identify and consider the reasonably foreseeable downstream GHG emissions as part of its NEPA analysis of the indirect effects of an interstate natural gas pipeline. 18   Shortly after that decision, the Commission took the position that it was required to consider the downstream emissions from a natural gas pipeline only under the exact facts presented in Sabal Trail—i.e., where the pipeline was transporting natural gas for combustion at a natural gas power plant. 19   In Birckhead, the D.C. Circuit rejected that argument, again admonishing the Commission that it must examine the specific facts of the case before it and that it cannot categorically ignore a pipeline’s downstream emissions just because it does not fit neatly within the facts of Sabal Trail. 

In addition, Birckhead criticized the Commission’s “less-than-dogged efforts to obtain the information it says it would need to determine that downstream greenhouse-gas emissions qualify as a reasonably foreseeable indirect effect of the Project.” 20   The court explained that NEPA “requires the Commission to at least attempt to obtain the information necessary to fulfill its statutory responsibilities” 21 and that a failure to do so falls short of its responsibility under NEPA to make its “best efforts to find out all that it reasonably can.” 22   The court suggested that a repetition of the Commission’s failure to seriously consider downstream emissions—including making its best efforts to gather what information is needed to perform that inquiry—would be “unreasonabl[e]” and a sufficient basis to grant a petition for review. 23

Nevertheless, in today’s order, the Commission neither attempts to assess the downstream GHG impacts of the Project nor asks the applicant to provide any details about end use, which it consistently claims is necessary to consider downstream GHG emissions.  In so doing, it is again “excus[ing] itself from making any effort to develop the record in the first place.” 24 That is exactly the result it was so roundly criticized for in Birckhead.    

The Commission’s failure to seriously consider GHG emissions is all-the-more glaring because the Project’s stated purpose is to interconnect with the Agua Blanca pipeline and ultimately deliver increased supplies of natural gas to the southwest, midcontinent, and Texas gulf coast. 25 According to the U.S. Energy Information Administration, more than 97 percent of the natural gas consumed in the United States is combusted. 26   Given that fact and the stated purpose of the Project, it is no great leap to assume that the vast majority, if not all, of the natural gas transported through the Project will be combusted.  Using that information, the Commission could have easily engaged in a little “‘reasonable forecasting’” aided by “‘educated assumptions’”—which is precisely what NEPA requires—in order to develop an estimate or a range of estimates of the likely emissions caused by the Project. 27 But, as noted, today’s order makes no effort—let alone the Commission’s “best efforts”—to consider the downstream impacts of the Project.  I cannot join an order that countenances such a half-hearted effort to assess a project’s adverse impacts.

The Commission’s failure to perform any of this analysis in order to disclose and seriously consider the significance of the impact of the Project’s GHG emissions is even more mystifying because NEPA “does not dictate particular decisional outcomes.” 28   NEPA “‘merely prohibits uninformed—rather than unwise—agency action.’” 29   The Commission could find that a project contributes significantly to climate change, but that it is nevertheless in the public interest because the project’s benefits outweigh its adverse impacts, including on climate change.  In other words, taking the matter seriously—and rigorously examining a project’s impacts on climate change—does not necessarily prevent any of my colleagues from ultimately concluding that a project satisfies the relevant public interest standard.

For these reasons, I respectfully dissent in part.



 

• 11 15 U.S.C. § 717f (2018).
• 22 National Environmental Policy Act of 1969, 42 U.S.C. §§ 4321 et seq.
• 33 Sendero Carlsbad Gateway,169 FERC ¶ 61,020 (2019) (Certificate Order).
• 44 Id. P 20; Environmental Assessment at 56 (EA).
• 55 Certificate Order, 169 FERC ¶ 61,020 at P 14.
• 66 Environmental Assessment, CP18-102-000, at 78 (2018).
• 77 Section 7 of the NGA requires that, before issuing a certificate for new pipeline construction, the Commission must find both a need for the pipeline and that, on balance, the pipeline’s benefits outweigh its harms. 15 U.S.C. § 717f (2018). Furthermore, NEPA requires the Commission to take a “hard look” at the environmental impacts of its decisions. See 42 U.S.C. § 4332(2)(C)(iii); Balt. Gas & Elec. Co. v. Nat. Res. Def. Council, Inc., 462 U.S. 87, 97 (1983). This means that the Commission must consider and discuss the significance of the harm from a pipeline’s contribution to climate change by actually evaluating the magnitude of the pipeline’s environmental impact. Doing so enables the Commission to compare the environment before and after the proposed federal action and factor the changes into its decisionmaking process. See Sierra Club v. FERC, 867 F.3d 1357, 1374 (D.C. Cir. 2017) (Sabal Trail) (“The [final environmental impact statement] needed to include a discussion of the ‘significance’ of this indirect effect.”); 40 C.F.R. § 1502.16 (a)–(b) (providing that an agency’s environmental review must “include the environmental impacts of the alternatives including the proposed action,” as well as a discussion of direct and indirect effects and their significance.) (emphasis added); see also Atl. Ref. Co. v. Pub. Serv. Comm’n of N.Y., 360 U.S. 378, 391 (1959) (holding that the NGA requires the Commission to consider “all factors bearing on the public interest”).
• 88 See Sabal Trail, 867 F.3d at 1373 (explaining that the Commission may “deny a pipeline certificate on the ground that the pipeline would be too harmful to the environment”); Birckhead v. FERC, 925 F.3d 510, 519 (D.C. Cir. 2019) (explaining that, “in the pipeline certification context the Commission does have statutory authority to act” on a project’s environmental consequences, including GHG emissions, and that the Commission, therefore, has a duty to consider the reasonably foreseeable GHG emissions); see also Atl. Ref. Co., 360 U.S. at 391 (holding that the NGA requires the Commission to consider “all factors bearing on the public interest”).
• 99 EA at 52 (stating that “[t]here is no generally accepted significance criteria for GHG emissions. In addition, we cannot determine the Project’s incremental physical impacts on the environment caused by GHG emissions. Therefore, we cannot determine whether the Project’s contribution to climate change would be significant.”).
• 1010 The Commission relies on its refusal to consider the Social Cost of Carbon, which I have criticized at length in previous statements. See Cheyenne Connector, LLC, 168 FERC ¶ 61,180 (2019) (Glick, Comm’r, dissenting in part, at PP 12-14); Empire Pipeline, Inc., 166 FERC ¶ 61,172 (2019) (Glick, Comm’r, dissenting in part, at PP 8-13); Transcontinental Gas Pipe Line Co., LLC, 167 FERC ¶ 61,110 (2019) (Glick, Comm’r, dissenting in part, at P 6 & n.11); Fla. Se. Connection, LLC, 164 FERC ¶ 61,099 (2018) (Glick, Comm’r, dissenting).
• 1111 EA at 56 (“[W]e have determined that if Gateway constructs and operates the proposed facilities in accordance with its application and supplements, and the staff’s recommended mitigation measures below, approval of the Project would not constitute a major action significantly affecting the quality of the human environment. We recommend that the Commission Order contain a finding of no significant impact.”).
• 1212 Id. at 52 (“[W]e cannot determine whether the Project’s contribution to climate change would be significant.”).
• 1313 Id. at 56.
• 1414 See, e.g., Myersville Citizens for a Rural Cmty., Inc. v. FERC, 783 F.3d 1301, 1322 (D.C. Cir. 2015) (agencies cannot overlook a single environmental consequence if it is even “arguably significant”); see also Michigan v. EPA, 135 S. Ct. 2699, 2706 (2015) (“Not only must an agency’s decreed result be within the scope of its lawful authority, but the process by which it reaches that result must be logical and rational.” (internal quotation marks omitted)); Motor Vehicle Mfrs. Ass’n, Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983) (Agency action is “arbitrary and capricious if the agency has . . . entirely failed to consider an important aspect of the problem, [or] offered an explanation for its decision that runs counter to the evidence before the agency.”).
• 1515 See Birckhead, 925 F.3d at 518-19; Sabal Trail, 867 F.3d at 1371-72.
• 1616 EA at 39-40, Tables 7 & 8.
• 1717 Certificate Order, 169 FERC ¶ 61,020 at P 5.
• 1818 Sabal Trail, 867 F.3d at 1371-72.
• 1919 Birckhead, 925 F.3d at 518-19 (rejecting the “Commission[’s] conten[tion] [that Sabal Trail] . . . is narrowly limited to the facts of that case” (internal quotation marks omitted)).
• 2020 Id. at 520.
• 2121 Id.
• 2222 Id. (quoting Barnes v. U.S. Dep’t of Transp., 655 F.3d 1124, 1136 (9th Cir. 2011)).
• 2323 Id. at 520-21.
• 2424 Id. at 520 (quoting Tennessee Gas Pipeline, 163 FERC 61,190 (2018) (Glick, Comm’r, dissenting at 2)).
• 2525 Certificate Order, 169 FERC ¶ 61,020 at P 5, n 10; see also Gateway August 9, 2018 Application at 9 (stating the gas transported on the Project is intended to provide “producer customers with access to new markets” and ultimately benefit “the consuming market.”).
• 2626 U.S. Energy Info. Admin., August 2019 Monthly Energy Review 22, 97 (2019) (reporting that, in 2018, 778 Bcf of natural gas had a non-combustion use compared to 29,956 Bcf of total consumption); see also Jayni Hein et al., Pipeline Approvals and Greenhouse Gas Emissions, 23-26 (Apr. 2019) (discussing the potential to use this information to develop straightforward estimates of a project’s reasonably foreseeable downstream emissions).
• 2727 Sabal Trail, 867 F.3d at 1374 (quoting Del. Riverkeeper Network v. FERC, 753 F.3d 1304, 1310 (D.C. Cir. 2014)); see id. (“We understand that emission estimates would be largely influenced by assumptions rather than direct parameters about the project, but some educated assumptions are inevitable in the NEPA process. And the effects of assumptions on estimates can be checked by disclosing those assumptions so that readers can take the resulting estimates with the appropriate amount of salt.” (internal citations and quotation marks omitted)).
• 2828 Sierra Club v. U.S. Army Corps of Engineers, 803 F.3d 31, 37 (D.C. Cir. 2015). .
• 2929 Id. (quoting Robertson, 490 U.S. at 351).