Item C-2: Commissioner James Danly Concurrence in Part and Dissent in Part Regarding Algonquin Gas Transmission, LLC Maritimes & Northeast Pipeline, L.L.C.

Commissioner James Danly Statement
January 20, 2022
Docket Nos. CP16-9-011 CP16-9-012

Today’s order[1] sustains Commission staff’s authorization for the Weymouth Compressor Station[2] to be placed into service[3] and terminates the Order Establishing Briefing (Briefing Order).[4]  I agree with this outcome.  In my view, Petitioners’ request for rehearing of the Authorization Order should have been denied long ago and the Briefing Order never issued.  The Briefing Order was unlawful.[5]  It destabilized project fundamentals.  It went against the “Commission’s long tradition of respecting the finality of its orders [which] accords with Congress’s intent to insulate the Commission, an independent, bipartisan agency, from arbitrary changes in policy . . . .”[6]

But rather than restore confidence, the majority leaves parties puzzled regarding the Commission’s authority and invents rationales to absolve itself of its unlawful act.  I am therefore compelled to dissent.

Explanation of Authority

In response to the Briefing Order, multiple comments, requests for rehearing, and petitions for appellate review were filed, all stating that the Commission lacked the authority to issue the Briefing Order.  Given the concerns raised, one would have hoped for the majority to provide a clear and thorough explanation of its authority, especially after the Commission seemingly avoided doing so.[7]

Instead the majority sends parties on a scavenger hunt—dispersing snippets here and there: sometimes in the text; sometimes in a footnote; sometimes with citations but most of the times not; never addressing the arguments or precedent that the Commission lacked authority to issue the Briefing Order.  And while one could find all the snippets, making sense of them would be quite a feat.

How does one square the majority’s statement “[t]he NGA does not expressly permit the Commission to reconsider the Certificate Order because judicial review of the Certificate has ended”[8] with the statement that “[w]here significant issues not contemplated by a certificate order arise, it is appropriate for the Commission to consider, in discharging its public interest obligations, what responsive action, if any, is appropriate.”[9]

Or with “the record before the Commission does not call into question the Commission’s ultimate finding that the project, as conditioned, is required by the public convenience and necessity.”[10]

Or with “we are unable to find the public interest requires setting aside the Authorization Order or imposing additional or different mitigation measures.”[11]

What do these statements mean?  Could it be that the majority is laying the foundation to argue that, as part of its “public interest responsibility,” it has an ongoing duty to revisit whether a project remains in the public convenience and necessity?  Or that the Commission will begin opening proceedings (of course, that could not be the reopening of the certificate itself, could it?) when it believes there may be evidence of significant project effects that are either not contemplated by the certificate or that call into question the certificate’s underlying public convenience and necessity determination?

If the majority intended to calm what they believed to be unnecessary and overstated fears that the Commission had reopened a final certificate, or to prove that, as my colleague neatly put it, “the British are not actually coming,”[12] it has failed to do so.  The majority’s refusal to explain the Commission’s authority only highlights the obvious fact that it had none.  And instead of acknowledging this plain fact, the majority leaves the door open to revisit whether a project is in the public convenience and necessity at its whim.  Those statements cannot be relegated to dicta.  One man’s dictum is another’s legal authority.

The Commission’s statements have real consequences.  The Briefing Order, and now this order, make it even less appealing to develop and finance needed energy infrastructure.  And as a bipartisan group of seven former Commissioners appointed by every president since President Reagan stated: such policy “undermines the Commission’s congressionally assigned mission of encouraging ‘the orderly development of plentiful supplies of electricity and natural gas at reasonable prices.’”[13]  “Put simply, increasing uncertainty for investors translates into higher energy bills and less reliable energy supply for consumers.”[14]

Rationales for Issuing the Briefing Order

To make matters worse, the majority appears to invent two new rationales for the issuance of the Briefing Order.  Before I explain, a recitation of the rationales the Commission and its members have previously offered is necessary to lay bare the fact that today’s confected justifications are not only unconvincing ex post facto explanations, they are also self-evidently and indisputably false.

In the Briefing Order, the rationale provided was: “We believe that the concerns raised regarding the operation of the project warrant further consideration by the Commission . . . .”[15]

In April 2021, Chairman Glick stated in his letter to Senator Barrasso: “the Commission is fulfilling its ongoing responsibility to the public interest, which continues throughout the construction and operation of certificated facilities, and even after the certificate becomes final.”[16]

Then in the order dismissing the rehearing requests, the rationale provided was: “the Briefing Order merely initiates a fact-finding proceeding as an exercise of the Commission’s continuing oversight of the Project.”[17]

The next day at the Commission’s May 2021 Open Meeting, Chairman Glick stated: “All the Commission did on February 18th was say, before we make a decision as to whether to uphold the staff decision to allow the project to be placed in service, let’s ask for additional comments on the health and safety issues presented by the Blow-downs.”[18]

Rather than clarify these statements, the majority first claims the Briefing Order was issued to “assure compliance with the certificate and its regulations governing certificates.”[19]  This must be false.

If investigating compliance were in fact the intent, one would reasonably expect the Briefing Order to have asked some variation of, “did the unplanned blowdowns at the Weymouth Compressor Station violate the terms of the certificate, the regulations of the Pipeline and Hazardous Materials Safety Administration (PHMSA), or its state air permit?”  But it did not.  And why was that the case?  Because there was never a question that Algonquin was in compliance with its certificate or other authorizations.[20]  A month before, Massachusetts Department of Environmental Protection (DEP) had reaffirmed its air permit for the Weymouth Compressor Station,[21] and as required by its certificate, Algonquin was complying with PHMSA’s regulations and, with PHMSA’s permission, had resumed operating the compressor station at full pressure.[22]

If my colleagues had legitimate concerns about compliance, perhaps they should have called Massachusetts DEP and PHMSA.[23]  In fact, the Commission committed to doing just that in its Memorandum of Understanding with the Department of Transportation: “The Commission shall . . . [r]efer to the Department, after screening, complaints and inquiries made by state and local governments and the general public involving safety matters related to pipelines under the Commission[’]s jurisdiction.”[24]

Next, the majority claims the Briefing Order was issued to “solicit[] further argument and information to inform its decision on rehearing of the Authorization Order.”[25]  But this also must be false given the contents of the Briefing Order.

Were that in fact the intent, one would expect the Briefing Order to have asked a question—a single question—regarding whether to grant rehearing of the Authorization Order: that is, did Commission staff properly determine “that rehabilitation and restoration of the right-of-way and other areas affected by the Project are proceeding satisfactorily” as required by Environmental Condition No. 10 of the certificate.[26]  It did not.

One would also expect the Commission to have solicited information needed to respond to arguments on rehearing.  Again, that was not the case.  None of the questions related to Petitioners’ first argument that the Commission “failed to complete a situational assessment and strategic responses for public safety and environmental impacts associated with incidents involving natural gas infrastructure.”[27]

Nor did the majority apparently need any of the solicited information to address Petitioners’ second argument that “[t]he unplanned emergency shutdowns and COVID-19 pandemic . . . rise to the level of a change in core circumstances” requiring the Commission to reopen the record under Rule 716[28] of the Commission’s Rules of Practice and Procedure.[29]  By simply citing to two Commission orders—which I had previously provided to my colleagues and cited in my dissent—today’s order explains, “Rule 716 does not, however, provide the Commission with additional authority to reopen the record underlying the Certificate Order here, where a final, non-appealable order has issued.”[30]

Moreover, one would reasonably expect the Briefing Order to be limited to the timely filed rehearing request.  Again, that is not what happened.  The Commission issued the Briefing Order because of “concerns raised”[31] in the rehearing request and “numerous other pleadings expressing safety concerns regarding the operation of the project,”[32] which had been filed after the deadline for filing a rehearing request.  I will not delve into the obvious problems this violation of a statutory deadline creates, but will note that the majority considers these “other pleadings”[33] on rehearing while at the same time it rejects the pipeline’s answer to the rehearing request as impermissible under the Commission’s regulations.[34]  Amazing.

The statements recited above are not merely unconvincing rationalizations, they are falsehoods.  To the extent to which this order purports to reflect the state of mind of the then-majority, those statements cannot be true.

Conclusion

Try as it might, the Commission cannot absolve itself of the fact that the Briefing Order unlawfully reopened a final, non-appealable certificate.  As I previously stated, “[t]here will be no applause for giving . . . parties an additional opportunity to participate.”[35]  “Those parties will undoubtedly criticize the Commission for its mismanagement, waste, and deception.”[36]  After everything that has happened in this proceeding, the only means by which the Commission could have restored confidence would have been to admit error.

For these reasons, I respectfully concur in part and dissent in part.