The Federal Energy Regulatory Commission on Friday overruled New York state regulators who had blocked construction of a 7.8-mile natural gas pipeline.
FERC ruled that the New York Department of Environmental Conservation waived its right to review the Valley Lateral Project by failing to act within a year of receiving Millennium Pipeline Co.'s application for an important water-quality permit.
The New York Department of Environmental Conservation, under Democratic Gov. Andrew Cuomo, had rejected the water-quality permit late last month, saying federal regulators had "failed to consider or quantify the indirect effects" of carbon emissions produced when the fuel shipped through the pipeline is eventually burned, called "downstream" emissions.
The Valley Lateral Project would supply a $900 million power plant under construction in Wawayanda.
In justifying the denial of the permit, the New York regulators cited an Aug. 22 D.C. Circuit Court of Appeals decision that rejected an approval by FERC of a separate pipeline project in Florida. In that case, the appeals court said FERC did not properly evaluate the effects of greenhouse gas emissions from the natural gas shipped by the pipeline.
While that ruling applied to a single project, the Southeast Market Pipelines Project, energy industry officials and legal experts have predicted it could have a broader impact, providing a precedent for regulators to block pipelines based on improper climate change analysis.
FERC's Friday decision overruling New York regulators did not mention the downstream emissions issue. Rather, FERC based its ruling on procedural grounds, stating the New York agency had waived its right to review the pipeline project because it did not issue a decision within a year of receiving the November 2015 application. With FERC's approval, Millennium indicated it plans to begin construction in November.
Industry groups cheered FERC's Friday decision.
"We applaud FERC's finding in its declaratory order in the Millennium proceeding," said Don Santa, president and CEO of the Interstate Natural Gas Association of America. "The commission's decision establishes that statutory deadlines must have meaning for it to achieve the purpose intended by Congress. This supports that policy goal by ensuring a reasonable process and timeframe for the review and decision making associated with permitting interstate natural gas pipelines."
Environmental groups, however, charged that FERC overstepped its authority.
"FERC's reversal of Governor Cuomo's decision is an insult to New Yorkers and our right to protect our communities and our water," said Roger Downs, director of the Sierra Club's Atlantic chapter. "States unquestionably have the authority to rule whether a dirty, dangerous fracked gas pipeline violates clean water laws, and nowhere is FERC granted the right to override that authority. For all their talk and bluster, Donald Trump and his nominees have once again proven to be nothing more than industry shills protecting corporate polluter profits over the rights of Americans to access clean water."
FERC is responsible for approving and regulating the interstate transmission of electricity, natural gas and crude oil. It approves $500 billion in infrastructure projects each year, with more than 1,500 cases coming to the commission.
The commission returned to work in August after being shut down for six months because it didn't have enough members.
Two of President Trump's nominees to serve on FERC, Kevin McIntyre, a Republican, and Richard Glick, a Democrat, have yet to be confirmed by the Senate.