FERC Raises the Bar for Public Participation in Gas Pipeline Certificate Proceedings

The Federal Energy Regulatory Commission (FERC) has a long-standing reputation for non-partisan decision-making. This was reinforced by its January 2018 rejection of the Department of Energy’s demand that electric pricing rules be changed to incentivize coal-fired and nuclear electric generation. More recent FERC actions, however, suggest that this independent regulatory agency is trending towards greater partisanship.

Just in the last month, FERC has issued two orders that make it significantly harder for environmental/ landowner groups to obtain party status in new gas pipeline construction proceedings.  Party status is only achieved at FERC via the grant of a motion to intervene.  Importantly, grant of party status gives one the right to seek judicial review of FERC’s actions.  Absent such status, affected environmental/landowner groups lack the ability to hold FERC accountable for orders that fail to address their particular concerns. This status is even more important today as pipeline projects become increasingly controversial and such groups rely on judicial review – together with adverse media coverage of FERC actions -- to advance their policy goals.

Yet these same groups, many of whom are non-profit, frequently lack the resources to keep up with the stream of new pipeline infrastructure applications flooding into FERC. While such applications can run thousands of pages, key portions are routinely excised from the version made public on the basis that the information is privileged and confidential.  Detailed maps provided to depict the proposed project may be designated non-public Confidential Energy Infrastructure Information (CEII). Yet FERC public notices of new certificate applications typically allow only 28 days for timely interventions and comments.  And for groups that rely on the Federal Register, the available time period is cut in half because it takes two weeks for the notice to first appear there. Two weeks is rarely enough time to evaluate these complex applications, decide whether to participate, and then formulate comments. As a consequence, many such groups routinely find themselves filing late interventions.

In recognition of these groups’ limited resources and this time crunch, FERC has always been liberal in its treatment of late filed interventions, particularly since gas pipeline infrastructure projects take many months to process. Indeed, FERC’s past policy has been to grant such late interventions as long as the motion was filed before issuance of an order on the merits of the application.

FERC's liberal late intervention policy will no longer be the case. In an order issued February 27, 2018, FERC announced a new policy for determining whether good cause exists to grant late filed motions to intervene. Stating that it was concerned that parties filing such late motions were failing to adequately address the reasons why they were late, FERC concluded there was a “pattern of failures to address these requirements . . . going forward we will be less lenient in the grant of late interventions.”  In addressing whether there was “good cause” not to have filed a timely motion to intervene, FERC cautioned, movants must explain why they should not be held to the FERC’s expectation that they intervene “in a timely manner based on reasonably foreseeable issues arising from the applicant’s filing and the [FERC’s] notice of the proceeding.”

In a March 15, 2018 order, FERC clarified this point and signaled it will be significantly more difficult to demonstrate good cause in the future. In discussing an intervention filed by an environmental group approximately 5 weeks after the public notice period ended, FERC found that the environmental group’s statement that it filed its motion to intervene the same day it first became aware that the application had been filed was insufficient evidence of good cause.  Further, FERC reiterated that it was putting all other future participants in pipeline certificate proceedings on notice that it was going to be less lenient in grant of late interventions in the future. These statements drew a dissent from the two democratic FERC Commissioners, Cheryl LaFleur and Richard Glick, who raised concerns regarding the political ramifications of this new late intervention policy, suggesting it will only serve to further erode public confidence in the impartiality of the FERC’s pipeline siting process.

This unexpected policy change is likely to figure in public comments on FERC’s upcoming proceeding to reevaluate its 1999 Policy Statement governing the pipeline certificate process. At a minimum, a strong argument can be made that this more rigid late intervention policy supports significantly extending the public notice period.  In the March 15, 2018 Order, FERC states it is basing its reinterpretation of what is “good cause” for late intervention in pipeline proceedings on how this issue is already handled in hydroelectric proceedings. Yet when a new hydroelectric license application is filed at FERC, the public is given 60 days to comment, in contrast to the 28 days given for new gas pipeline infrastructure applications.