Attorney Thomas S. West
Founder and Managing Partner
The West Firm, PLLC
FERC just gave Millennium Pipeline a big win and blew New York State DEC out of the water with a much deserved put-down and precedent for other pipelines.
The Federal Energy Regulatory Commission (“FERC”) issued an important decision today in favor of Millennium Pipeline Company, L.L.C. (“MPC”) that is sure to effect New York regulatory matters. FERC determined that the New York State Department of Environmental Conservation (“NYSDEC”) waived its authority to issue a water quality certificate under Section 401 of the Clean Water Act (“CWA”).
The waiver is for MPC’s 7.8 mile 16-inch-diameter pipeline and related facilities intended to provide 127,200 dekatherms per day to Competitive Power Ventures’ controversial Valley Energy Center; a 680 MW natural gas-fueled combined cycle electric generating facility in the Town of Wawayanda, New York (NYISO Electric Zone G). While MPC is still in need of a Notice to Proceed from FERC to continue with the project, FERC’s decision may clear the way for construction of the line.
FERC originally issued to MPC a Certificate of Public Convenience and Necessity for the project on November 9, 2016. This Certificate, however, required MPC to obtain all authorizations required by federal law, or a waiver thereof, prior to commencing construction of the line. This included the NYSDEC issued CWA Section 401 Water Quality Certificate. MPC first applied to the NYSDEC for this certification on November 23, 2015.
According to FERC, the NYSDEC then had “a reasonable period of time (which shall not exceed one year) after receipt of (such) a request” (33 U.S.C. Section 1341(a)(1)) to make a decision and, in failing to do so, waived its authority on the matter. In re Millennium Pipeline Company, L.L.C., Docket No. CP16-17-000, 160 FERC ¶ 61,065, pp. 4-5 (FERC Sept. 15, 2017).
The NYSDEC argued that it satisfied this requirement because it made a decision within one year of receipt of a “completed application,” but FERC rejected this argument, stating that the NYSDEC could have, at any time, simply denied the application prior to the deadline. In re Millennium Pipeline Company, L.L.C., Docket No. CP16-17-000, 160 FERC ¶ 61,065, at p. 8.
This is certainly an interesting development in light of the recent New York denials of pipeline infrastructure intended to satisfy present demands not only in New York but also throughout the New England region. In the future, though, the NYSDEC will most likely avoid this pitfall by making timely decisions.
The West Firm is proud to represent the energy industry regarding controversial projects and issues.
Editor’s Note: Here’s the money paragraph from the FERC decision:
“[T]he starting point for interpreting a statute is the language of the statute itself.” Determining whether the plain meaning of the statutory text resolves the issue includes consideration of “the particular statutory language at issue, as well as the language and design of the statute as a whole.” Section 401 provides that water quality certification is waived when the certifying agency “fails or refuses to act on a request for certification, within a reasonable period of time (which shall not exceed one year) after receipt of such request.”18 Thus the term “receipt” specifies the triggering event. The dictionary definition of “receipt” is the act or process of receiving. Therefore, in this context, the plain meaning of “after receipt of the request” is the day the agency receives a certification application, as opposed to when the agency considers the application to be complete. Giving effect to the plain text of a statute, the one-year review period began November 23, 2015, the date that New York DEC received the application.
As this paragraph indicates, FERC didn’t buy DEC’s contention that it got to decide the start date for the one-year period buy playing “incomplete application” games. The implications for other New York State pipeline water quality certification requests are, as Tom suggests, very significant. Ironically, this may be exactly the decision Gov. Cuomo hoped for: he gets the case and fractivist street cred for opposing it.