EPA final rule aims to narrow, speed up state decisions under Clean Water Act

The Environmental Protection Agency (EPA) issued a final rule June 1 to clarify and more narrowly specify how a state can certify a project under the Clean Water Act—a change that may allow more proposals for oil and natural gas pipelines to win approvals.

The rule stems from disputes over how some states have used their authority under Clean Water Act Section 401 to certify that permits will not harm water quality. Denial of certification has allowed states to block projects for reasons that have been debated and continue to be litigated.

“EPA is returning the Clean Water Act to its original purpose, which is to review potential impacts that discharges from federally permitted projects may have on water resources, not to indefinitely delay or block critically important infrastructure,” EPA Administrator Andrew Wheeler said in an announcement of the final rule.

The rule specifies a one-year limit on the time a state or tribe can take on its decision after receiving a certification request. It also specifies that a certification must be keyed to the potential for a discharge of pollution from a “point source,” a phrase from the Clean Water Act that narrows the scope of what can be considered a violation.

The timeline and other elements of the rule will make it more difficult for a state to block a project by asking for ever more information from a project proponent.

The new rule will take effect 60 days after it is published in the Federal Register. Other federal permitting agencies, such as the US Army Corps of Engineers and the Federal Energy Regulatory Commission (FERC), will have to conform their permitting procedures to EPA’s specifications.

New York versus pipelines

Industry associations including the American Petroleum Institute and the Interstate Natural Gas Association of America greeted the new regulations as a step to prevent states from abusing the certification process.

Basil Seggos, commissioner of the New York State Department of Environmental Conservation, issued a statement June 1 signaling fights to come.

“New York State will continue to fight this administration’s unlawful attempt to limit our authority to protect state waters,” Seggos said. “This action is nothing short of a federal power grab that would strip New York and all states of our authority.”

In recent years New York has frequently opposed pipeline projects by denying a Section 401 certification. It attempted to do so when the owners of the Millennium Pipeline, a natural gas line, wanted to build an extension from an interstate line to a new power plant in Orange County, NY, but the US Court of Appeals for the Second Circuit ruled against the state.

EPA in its final rule cited the ruling in that 2018 case, New York State Department of Environmental Conservation v. FERC. It quoted the court saying that if a state were not held to a time limit, states could get away with “dictating that applications are complete only when state agencies decide that they have all the information they need. The state agencies could thus theoretically request supplemental information indefinitely.”

The New York agency in that case had denied a permit by saying FERC had failed to consider greenhouse gas impacts in its environmental review.

Pipeline projects await OKs

Several industry groups have compiled examples of projects delayed by states using the Section 401 certification process. Among the projects still actively pursued by backers:

Oregon denied a Section 401 certification for the Jordan Cove liquefied natural gas export terminal and the 229-mile Pacific Connector gas pipeline that would supply it. Pembina Pipeline Corp., owner of project, has not given up on the pipeline (OGJ Online, Mar. 20, 2020).

New York has denied a certification for the Northeast Supply Enhancement Project, a Transco system pipeline network expansion that Williams Cos. Inc. has proposed to increase the supply of natural gas to the New York City area (OGJ Online, May 19, 2020). The project also has yet to get a certification from New Jersey.

New York also denied certification for the Northern Access Pipeline, a project proposed by National Fuel Gas Co. that would take gas from Pennsylvania to a pipeline connection near Buffalo. FERC said New York waived its certification authority by failing to act within 1 year. The state is contesting the decision in federal court (OGJ Online, Feb. 6, 2019).