Commissioner Richard Glick Dissent regarding the Driftwood LNG Project

Commissioner Richard Glick Statement

April 18, 2019

Docket No. CP17-117-000, CP17-118-000

Decision C-2

I dissent from today’s order because it violates both the Natural Gas Act1 (NGA) and the National Environmental Policy Act2 (NEPA). In particular, the Commission is again refusing 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 liquefied natural gas (LNG) facility. Yet that is precisely what the Commission is doing today.

In the order authorizing Driftwood LNG LLC’s LNG export terminal (LNG Terminal) pursuant to section 3 of the NGA and the associated natural gas pipeline (Pipeline Project) pursuant to section 7 of the NGA (collectively, Project), the Commission treats GHG emissions differently than all other environmental impacts. By refusing to assess the significance of the impact of the Project’s GHG emissions, even after quantifying them, the Commission not only neglects its obligation to assess the environmental impacts, but also its concomitant duty to explore possible mitigation measures to reduce any significant adverse effects. This systematic failure to consider the Project’s impacts on climate change is what allows the Commission to misleadingly state that “[a]ll [environmental] impacts . . . will be reduced to less-than-significant levels” 3 and, as a result, conclude that the Project satisfies the NGA’s public interest standards.4

I. The Commission’s Public Interest Determinations Are Not the Product of Reasoned Decisionmaking

The NGA’s regulation of LNG import and export facilities “implicate[s] a tangled web of regulatory processes” split between the U.S. Department of Energy (DOE) and the Commission.5 The NGA establishes a general presumption favoring the import and export of LNG unless there is an affirmative finding that the import or export “will not be consistent with the public interest.”6 Section 3 of the NGA, which governs LNG imports and exports, provides for two independent public interest determinations: one regarding the import or export of LNG itself and one regarding the facilities used for that import or export. DOE determines whether the import or export of LNG is consistent with the public interest, with transactions among free trade countries legislatively deemed to be “consistent with the public interest.”7 The Commission evaluates whether “an application for the siting, construction, expansion, or operation of an LNG terminal” is itself consistent with the public interest.8 Pursuant to that authority, the Commission must approve a proposed LNG facility unless the record shows that the facility would be inconsistent with the public interest.9

As part of that determination, the Commission must examine a proposed LNG facility’s impact on the environment and public safety. A facility’s impact on climate change must be part of a public interest determination under the NGA.10 Nevertheless, the Commission maintains that it need not consider whether the Project’s contribution to climate change is significant because it lacks a means to do so—or at least so it claims.11 However, the shocking part of the Commission’s rationale is what comes next. Based on this alleged inability to assess significance, the Commission concludes that the Project will have no significant environmental impact.12 That is the equivalent of saying that an action that is known to be dangerous is actually safe because we do not know exactly how dangerous it is. That is ludicrous and it certainly does not give climate change the serious consideration it deserves and that the law demands.

The Commission’s failure to consider the impact of the Project’s GHG emissions is all-the-more glaring given the volume of emissions at issue in this proceeding. The Final EIS points out that the Project will directly emit over 10 million tons of GHGs annually.13 That is equivalent to the annual GHG emissions from 2.3 million automobiles—which is more than all of the cars in the Commonwealth of Kentucky. Especially given the Commission’s acknowledgment that GHG emissions contribute to climate change,14 the decision to exclude emissions from playing any role in the Commission’s public interest analysis is indefensible.

The implications of the Commission’s approach to evaluating the impacts of GHG emissions extend beyond any single proceeding under NGA section 3 or section 7. Taking the Commission’s approach to its logical conclusion, the Commission would approve any project regardless of the amount of GHGs emitted without ever determining the significance of their environmental impact. If the Commission’s assessment of that impact will not change no matter the volume of GHG emissions at issue, those emissions and their consequences cannot meaningfully factor into the public interest determination. Approving a project that may significantly contribute to the harms caused by climate change without meaningfully evaluating the significance of that impact or considering it as part of the public interest determination is contrary to law, arbitrary and capricious, and not the product of reasoned decisionmaking.15

II. The Commission Fails to Satisfy Its Obligations under NEPA

In order to evaluate the environmental consequences of the Project under NEPA, the Commission must consider the harm caused by the Project’s GHG emissions and “evaluate the ‘incremental impact’ that these emissions will have on climate change or the environment more generally.”16 As noted, the Final EIS states that the Project will directly emit over 10 million tons of GHGs annually.17 Although that quantification of the Project’s GHG emissions is a necessary step toward meeting the Commission’s NEPA obligations, listing the volume of emissions alone is insufficient.18
As an initial matter, identifying the consequences that those emissions will have for climate change is essential if NEPA is to play the disclosure and good government roles for which it was designed. The Supreme Court has explained that NEPA’s purpose is to “ensure[] that the agency, in reaching its decision, will have available, and will carefully consider, detailed information concerning significant environmental impacts” and to “guarantee[] that the relevant information will be made available to the larger audience that may also play a role in both the decisionmaking process and the implementation of that decision.”19 It is hard to see how hiding the ball on a project’s climate impacts is consistent with either of those purposes.

In addition, under NEPA, a finding of significance informs the Commission’s inquiry into potential ways of mitigating environmental impacts.20 The Supreme Court has held that an EIS must “contain a detailed discussion of possible mitigation measures” to address adverse environmental impacts.21 The Court explained that, “[w]ithout such a discussion, neither the agency nor other interested groups and individuals can properly evaluate the severity of the adverse effects” of a project, making an examination of possible mitigation measures necessary to ensure that the agency has taken a “hard look” at the environmental consequences of the action at issue.22 Consistent with this obligation, the Final EIS discusses mitigation measures to ensure that all of the Project’s adverse environmental impacts, other than GHG emissions, are reduced to less than significant levels.23 For example, in order to find that the Project’s impacts on wetlands are less than significant,24 the Commission relies on compensatory mitigation including the purchase of mitigation credits.25 The Commission not only has the obligation to discuss mitigation of adverse environmental impacts under NEPA, but also the authority to condition certificates under section 3 and 7 of the NGA.26 Once again, however, the Project’s climate impacts are treated differently. By refusing to assess significance, the Commission escapes its obligation to consider mitigation measures for the Project’s GHG emissions.

In refusing to even assess the significance of the Project’s GHG emissions during the environmental review process, the Commission relegates climate change to a negligible role, at best, in its NEPA analysis. Nothing in today’s order justifies this result. The Commission argues that it need not determine whether the Project’s contribution to climate change is significant because “[t]here is no standard methodology” to determine whether the GHG emissions “would result in physical effects on the environment for the purposes of evaluating the Project’s impact on climate change, either locally or nationally.”27 As a logical matter, the argument that there is no single standard methodology for evaluating the significance of GHG emissions does not excuse the Commission from assessing the Project’s environmental impacts under NEPA. The claimed absence of a standard methodology is no justification for effectively ignoring those emissions.28

Moreover, the argument that there is no single standard methodology for evaluating the significance of GHG emissions is a red herring. The lack of any single methodology does not prevent the Commission from adopting a methodology, even if others are available. The Commission has several tools to assess the harm from the Project’s contribution to climate change. By measuring the long-term damage done by a ton of carbon dioxide, the Social Cost of Carbon links GHG emissions to actual environmental effects from climate change, thereby facilitating the necessary “hard look” at the Project’s environmental impacts that NEPA requires. Especially when it comes to a global problem like climate change, a measure for translating a single project’s climate change impacts into concrete and comprehensible terms plays a useful role in the NEPA process by putting the harm in terms that are readily accessible for both agency decisionmakers and the public at large. Yet, the Commission continues to ignore the Social Cost of Carbon, relying instead on deeply flawed reasoning that I have previously critiqued at length.29

Regardless of tools or methodologies available, the Commission can use its judgment and discretion to consider all factors and determine, quantitatively or qualitatively, whether the Project’s GHG emissions have a significant impact on climate change. After all, that is precisely what the Commission does in other aspects of its environmental review. For example, consider the Commission’s evaluation of the Project’s impact on the surrounding land. The Final EIS determines that a total of 1,195 acres of vegetation would be permanently lost, but then concludes that these impacts on vegetation would not be significant.30 The Final EIS provides no “standard methodology” or “accepted significance criteria” available to the Commission to evaluate this impact.31 Instead, the Commission uses its judgment to conduct a qualitative review to assess the Project’s impact on vegetation. For the LNG Terminal, the Commission states that the impact would not be significant based on a finding that there is “abundant similar vegetation resources in the region.”32 The Commission’s refusal to exercise similar qualitative discretion and judgment when it comes to evaluating the impacts of GHG emissions is arbitrary and capricious and willfully ignorant.

The Commission’s refusal to 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.”33 NEPA “‘merely prohibits uninformed—rather than unwise—agency action.’”34 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 meets the public interest standard. Indeed, a thorough investigation of a project’s contribution to climate change would also help infrastructure developers by reducing their legal risk in the appeals that will inevitably follow. At the end of the day, no one benefits from the Commission’s refusal to consider a project’s impact on climate change.

For these reasons, I respectfully dissent.


 

• 11 15 U.S.C. §§ 717b, 717f (2012).
• 22National Environmental Policy Act of 1969, 42 U.S.C. §§ 4321 et seq.
• 33Driftwood LNG LLC, 167 FERC ¶ 61,054, at P 25 (2019) (Certificate Order); Final Environmental Impact Statement at ES-14–ES-15 (Final EIS).
• 44Certificate Order, 167 FERC ¶ 61,054 at PP 28, 35.
• 55Sierra Club v. FERC, 827 F.3d 36, 40 (D.C. Cir. 2016) (Freeport).
• 6615 U.S.C. §717b(a); see EarthReports, Inc. v. FERC, 828 F.3d 949, 953 (D.C. Cir. 2016) (citing W. Va. Pub. Servs. Comm’n v. Dep’t of Energy, 681 F.2d 847, 856 (D.C. Cir. 1982) (“NGA [section] 3, unlike [section] 7, ‘sets out a general presumption favoring such authorization.’”)). Under section 7 of the NGA, the Commission approves a proposed pipeline if it is shown to be consistent with the public interest, while under section 3, the Commission approves a proposed LNG import or export facility unless it is shown to be inconsistent with the public interest. Compare 15 U.S.C. §717b(a) with 15 U.S.C. §717f(a), (e).
• 7715 U.S.C. § 717b(c). The courts have explained that, because the authority to authorize the LNG exports rests with DOE, NEPA does not require the Commission to consider the upstream or downstream GHG emissions that may be indirect effects of the export itself when determining whether the related LNG export facility satisfies section 3 of the NGA. See Freeport, 827 F.3d at 46-47; see also Sierra Club v. FERC, 867 F.3d 1357, 1373 (D.C. Cir. 2017) (Sabal Trail) (discussing Freeport). NEPA still requires, however, that the Commission consider the direct GHG emissions associated with a proposed LNG export facility. See Freeport, 827 F.3d at 41, 46.
• 8815 U.S.C. § 717b(e). In 1977, Congress transferred the regulatory functions of NGA section 3 to DOE. DOE, however, subsequently delegated to the Commission authority to approve or deny an application for the siting, construction, expansion, or operation of an LNG terminal, while retaining the authority to determine whether the import or export of LNG to non-free trade countries is in the public interest. See EarthReports, Inc., 828 F.3d at 952-53.
• 99See Freeport, 827 F.3d at 40-41.
• 1010See 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”); 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”).
• 1111Final EIS at ES-13 (explaining that “[t]here is no generally accepted significance criteria for [GHG] emissions” and “[t]herefore, we cannot determine whether the Project’s contribution to climate change would be significant”).
• 1212Final EIS at ES-14–ES-15; see also Certificate Order, 167 FERC ¶ 61,054 at P 120 (stating that the Commission agrees with the conclusions presented in the [F]inal EIS and finding that the Project is an “environmentally acceptable action”).
• 1313Final EIS at Tables 4.12-4, 4.12-8, 4.12-9, 4.12-10, 4.12-14; see also Certificate Order, 167 FERC ¶ 61,054 at P 99.
• 1414Final EIS at 4-294–4-295.
• 1515 As noted, the NGA “requires the Commission to evaluate all factors bearing on the public interest,” Atl. Ref. Co., 360 U.S. at 391, which Sabal Trail held includes a facility’s contribution to the harms caused by climate change, 867 F.3d at 1373.
• 1616 Ctr. for Biological Diversity v. Nat’l Highway Traffic Safety Admin., 538 F.3d 1172, 1216 (9th Cir. 2008); WildEarth Guardians v. Zinke, No. CV 16-1724 (RC), 2019 WL 1273181, at *1 (D.D.C. Mar. 19, 2019) (explaining that the agency was required to “provide the information necessary for the public and agency decisionmakers to understand the degree to which [its] decisions at issue would contribute” to the “impacts of climate change in the state, the region, and across the country”).
• 1717 Supra note 13.
• 1818 See Ctr. for Biological Diversity, 538 F.3d at 1216 (“While the [environmental document] quantifies the expected amount of CO2 emitted . . . , it does not evaluate the ‘incremental impact’ that these emissions will have on climate change or on the environment more generally . . . .”); Klamath-Siskiyou Wildlands Ctr. v. Bureau of Land Mgmt., 387 F.3d 989, 995 (9th Cir. 2004) (“A calculation of the total number of acres to be harvested in the watershed is a necessary component . . . , but it is not a sufficient description of the actual environmental effects that can be expected from logging those acres.”).
• 1919Dep’t of Transp. v. Pub. Citizen, 541 U.S. 752, 768 (2004) (citing Robertson v. Methow Valley Citizens Coun., 490 U.S. 332, 349 (1989)).
• 202040 C.F.R. § 1502.16 (2018) (NEPA requires an implementing agency to form a “scientific and analytic basis for the comparisons” of the environmental consequences of its action in its environmental review, which “shall include discussions of . . . [d]irect effects and their significance.”).
• 2121Robertson, 490 U.S. at 351.
• 2222Id. at 352; see also 40 C.F.R. §§ 1508.20 (defining mitigation), 1508.25 (including in the scope of an environmental impact statement mitigation measures).
• 2323Certificate Order, 167 FERC ¶ 61,054 at PP 70, 72, 76, 78, 83, 88 (The Commission states that adverse environmental impacts to soils, water resources, wetlands, vegetation, and land use, recreation and visual resources will be reduced to less than significant levels if the Applicant implements proposed mitigation measures.).
• 2424Final EIS at ES-5.
• 2525Id.; see also Final EIS at 4-70–4-71 (The U.S. Army Corps of Engineers (COE) has a goal of “no net loss” for wetlands and the COE New Orleans District Wetland Mitigation Plan provides prescribed guidelines for preferred mitigation measures. The Applicant proposes to achieve COE’s goal through a combination of contributed dredging materials to restore degraded coastal wetlands and wetland mitigation credits. The Commission determines that wetland impacts would not be significant with the proposed mitigation measures and additional Environmental Condition regarding wetland drilling.).
• 262615 U.S.C. § 717b(e)(3)(A); 15 U.S.C. § 717f(e); Certificate Order, 167 FERC ¶ 61,054 at P 119 (“[T]he Commission has the authority to take whatever steps are necessary to ensure the protection of environmental resources . . . , including authority to impose any additional measures deemed necessary . . . .”).
• 2727Final EIS at ES-13; see also Certificate Order, 167 FERC ¶ 61,054 at P 100 (acknowledging that the Project will contribute to climate change but claiming that it cannot determine whether that contribution—or the resulting harm—will be significant).
• 2828My colleague, Commissioner LaFleur, wrestled with these questions and reached a judgment on both the significance of the impact of the GHG emissions and the merits of the Project notwithstanding the lack of analysis in the Commission’s order. Certificate Order, 167 FERC ¶ 61,054 (LaFleur, Comm’r, concurring at P 8). Providing additional context regarding the Project’s GHG emissions and their cumulative impact is a useful first step that promotes public disclosure and informed decisionmaking. But neither that context nor a concurrence assessing—and ultimately recognizing—the significance of the impact of the Project’s GHG emissions can remedy the order’s erroneous conclusion that the Commission cannot evaluate the significance of the Project’s contribution to climate change or its assumption that such a contribution is insignificant. Nor can a concurrence remedy the absence of any discussion in the record of the significance of the Project’s contribution to climate change.
• 2929See, e.g., Fla. Se. Connection, LLC, 164 FERC ¶ 61,099 (2018) (Glick, Comm’r, dissenting).
• 3030Certificate Order, 167 FERC ¶ 61,054 at PP 77-78; Final EIS at ES-5, Table 4.6-2.
• 3131As compared to the Commission’s requirement for a “standard methodology” to determine the significance of the Project’s GHG emissions, as discussed in Certificate Order, 167 FERC ¶ 61,054 at P 100 (citing to Dominion Transmission, Inc., 163 FERC ¶ 61,128, at PP 67-70 (2018) (LaFleur, Comm’r, dissenting in part; Glick, Comm’r, dissenting in part)).
• 3232Final EIS at 4-79.
• 3333Sierra Club v. U.S. Army Corps of Engineers, 803 F.3d 31, 37 (D.C. Cir. 2015).
• 3434Id. (quoting Robertson, 490 U.S. at 351).