Commissioner Richard Glick Statement regarding Florida Southeast Connection, LLC

Commissioner Richard Glick Statement

May 30, 2018

Docket No.: CP17-463-000

“Today, the Commission determines that the Okeechobee Lateral Project (Project), which will enable Florida Power & Light to provide the Okeechobee Clean Energy Center with natural gas transportation service, is in the public interest.1 I dissent in part from today’s order on two grounds. First, I believe that the Commission cannot conclude that the Project is in the public interest without first determining the significance of the Project’s contribution to climate change. Second, I disagree with the Commission’s determination that precedent agreements among affiliates are, by themselves, sufficient to show that a natural gas pipeline is needed. I address these points in turn.

“As the Order explains, the Project will provide a lateral pipeline connection between the Florida Southeast Connection pipeline—which is bundled with other projects commonly referred to as the Sabal Trail pipeline—and the Okeechobee Clean Energy Center.2 Because the Project’s transportation capacity is designated for a specific natural gas-fired power plant, the order considers the end use of the transported natural gas and quantifies the resulting emissions.3 Unfortunately, the Commission ends its analysis there, without making any effort to determine the significance of the 5.46 million tons of greenhouse gas (GHG) emissions potentially caused by the Project.4

“The Natural Gas Act (NGA) and the National Environmental Policy Act (NEPA) require more. Although quantifying and disclosing downstream GHG emissions are necessary steps in evaluating the Project’s impact on climate change, cataloguing these pollutants is not enough to satisfy our statutory obligations. Instead, the Commission must actually assess the harm that the Project will cause as a result of its contribution to climate change.

“As I have previously explained,5 the Commission is incorrect insofar as it concludes that there is “no widely accepted standard to ascribe significance to a given rate or volume of GHG emissions.”6 That is precisely what the Social Cost of Carbon provides. It translates the long-term damage done by a ton of carbon dioxide into a monetary value, thereby providing a meaningful and informative approach for satisfying an agency’s obligation to consider how its actions contribute to the harm caused by climate change.7 Moreover, the implication of the Commission’s conclusion is that no federal agency can ever evaluate the impact that its actions have on the single most significant environmental issue of our time—a conclusion that borders on the absurd.8 So long as the Social Cost of Carbon can be calculated, the Commission cannot escape its responsibility to fully consider the environmental harm caused by its permitting decisions.9

“I also cannot join the Commission’s conclusion that precedent agreements between a pipeline and its corporate affiliates are sufficient, in and of themselves, to demonstrate that a pipeline is needed. Although precedent agreements generally can be one measure for determining whether a pipeline is needed, precedent agreements among affiliates are less valuable for this purpose because they are not necessarily the product of arms-length negotiations.10 As a result, I cannot conclude based on the mere existence of affiliate precedent agreements that a pipeline is actually needed. Instead, under such circumstances, the Commission must look behind the precedent agreements and consider other indicia of need. For example, the Commission might look to the considerations laid out in its Certificate Policy Statement, which identifies several other criteria for evaluating need, including projections of the demand for natural gas, analyses of the available pipeline capacity, and assessments of the cost savings that the proposed pipeline would provide to consumers.11

“In this case, the Commission could have considered the fact that the Okeechobee Clean Energy Center had already received the necessary permits from the state of Florida and does not have an alternative source of natural gas. However, it chose not to do so, relying, instead, solely on the precedent agreement.

“For these reasons, I respectfully dissent in part.”

• 11 Florida Southeast Connection, LLC, 163 FERC ¶ 61,158 (2018).
• 22 Id. P 40.
• 33 Id.
• 44 Id. (noting the Commission’s continued agreement with the explanation provided in the Supplemental EIS for the Sabal Trail pipeline in Florida Southeast Connection, LLC, 162 FERC ¶ 61,233 (2018) that “there is a no widely accepted standard to ascribe significance to a given rate or volume of GHG emissions”).
• 55 Florida Southeast Connection, LLC, 162 FERC ¶ 61,233, at 2, 5–8 (2018) (Glick, Comm’r, dissenting).
• 66 Id. P 27.
• 77 Id. at 5 (Glick, Comm’r, dissenting) (citing cases that discuss the Social Cost of Carbon when evaluating whether an agency complied with its obligation under NEPA to evaluate the climate change impacts of its decisions).
• 88 Id. at 6 (Glick, Comm’r, dissenting).
• 99 The Commission’s order cites to Western Organization of Resource Councils v. U.S. Bureau of Land Management, No. CV 16-21-GF-BMM, slip op. at 13-14 (D. Mon. Mar. 26, 2018) to suggest NEPA does not require agencies to undertake cost-benefit analyses utilizing Social Cost of Carbon. However, the Commission’s reliance on Western Organization of Resource Councils is inapposite to the situation in this proceeding. As the court noted, citing to High Country Conservation Advocates v. U.S. Forest Service, 52 F. Supp. 3d 1174, 1193 (D. Colo. 2014), an agency is required to employ the Social Cost of Carbon to calculate the impact of its action on climate change if the agency also calculates the benefits of the proposed action in an EIS. FERC, in the EIS prepared for Florida Southeast Connection, LLC, 162 FERC ¶ 61,233 (2018), did calculate the economic benefits of the proposed pipeline and as a result, the Commission is required to utilize the Social Cost of Carbon to examine the adverse impacts.
• 1010 PennEast Pipeline Co., LLC, 162 FERC ¶ 61,053, at 1–2 (2018) (Glick, Comm’r, dissenting).
• 1111 Certification of New Interstate Natural Gas Pipeline Facilities, 88 FERC ¶ 61,227, 61,747 (1999) (Certificate Policy Statement) (“[T]he Commission will consider all relevant factors reflecting on the need for the project. These might include, but would not be limited to, precedent agreements, demand projections, potential cost savings to consumers, or a comparison of projected demand with the amount of capacity currently serving the market.”).