Editor & Publisher, Marcellus Drilling News (MDN)
The unanimous FERC vote on the Constitution Pipeline tells us the agency has chosen to take over from Andrew Cuomo. Is it what he wanted? Or, are they angry?
Just prior to taking a long Labor Day holiday weekend, MDN brought you news that the Federal Energy Regulatory Commission (FERC) has overruled New York State to allow the Constitution Pipeline to move forward with construction. We missed a small but important part of the story–the fact that all four FERC commissioners, two Republicans and two Democrats, voted to overrule NY. FERC appears to be teed off at Andrew Cuomo and this decision slaps him around.
The fact that Richard “Dick” Glick, a Democrat FERC commission who has, as near as we can tell, voted against every single natural gas pipeline that’s come before him voted positively for Constitution, says a lot.
According to Dan Markind, a Philadelphia attorney who now writes his columns about the Marcellus/Utica for the Forbes magazine website, this is evidence that FERC is not going to allow states like New York, California, and Maryland interfere with federal pipeline projects.
Dan does an excellent job of fleshing out this issue, providing a concise history of how it developed. He points out that until a few years ago issuing a “section 401” water crossing permit (part of the federal Clean Water Act) was nothing more than a formality. It was Andrew Cuomo who politicized the 401 certificate, using it in a way it was never meant to be used–to block a new pipeline. Those days, says Dan, are now done. FERC is mad and isn’t going to take it any more.
Ten days ago, the Federal Energy Regulatory Commission (FERC) moved to reassert control over the permitting of interstate oil and gas pipelines. FERC determined that New York State had forfeited its power to block construction of the proposed Constitution Pipeline because the New York State Department of Environmental Conservation (DEC) had taken more than the allotted one-year period to disapprove a request by the pipeline developers for a Section 401 Clean Streams Certification. Ironically, that ruling may be just what New York Governor Andrew Cuomo was hoping for…
For the most part, decisions on interstate energy pipelines are federalized under FERC. Once finally approved by FERC, the only major task left is supposed to be the pipeline construction itself. Practically the only discretion left to the states in this process is whether or not to grant a Certification under Section 401 of the Federal Clean Water Act. This state certification of water quality is basically to confirm that any “discharge” into “navigable waters” resulting from an interstate pipeline would meet the standards of the Federal Clean Water Act…
Until 2016, the Section 401 process was thought of mostly as an administrative task. In 2016, however, New York Governor Andrew Cuomo seized upon the 401 Certification as a way to control – more precisely prevent – the construction of interstate pipelines. His DEC refused to grant a 401 Certification for the Constitution Pipeline, stopping that project in its tracks at the time…
The owners of that pipeline first applied to the DEC for a Section 401 Certification in 2014. At the request of the DEC, which continually asked for more information, the owners resubmitted their application several times. The DEC then took the position that each resubmission constituted a new application, giving itself a fresh one-year timeline from the date of each separate resubmission. FERC disagreed. By a 4-0 vote last week, FERC decided that New York had simply forfeited its right to pass on the project by taking too long. Further, FERC refused to grant the state an injunction against construction while it decided whether or not to appeal…
The 4-0 vote included both Democratic and Republican FERC appointees, indicating how annoyed the agency was with the power grab by the Cuomo Administration…
Ironically, in the Machiavellian world of New York politics, this FERC ruling might be exactly what Andrew Cuomo wants. New York, as a state, desperately needs more natural gas. Moratoria against new gas hookups are now in effect in the city of New York and in many other downstate municipalities. Business growth already is being affected, not to mention impacts on many ordinary citizens. For example, homeowners are being stymied in their attempts to switch their homes from more polluting (and expensive) heating oil to generally cleaner (and less costly) natural gas. If a bad winter hits, New York might even have to import gas from Russia again, as it has had to do in the past.
Governor Cuomo no doubt knows that his state needs new energy sources badly, but he does not want to lose his political support from the environmental movement either. Thus, ideally, he would not mind too much were a third party to “force” him to construct the infrastructure needed to supply New York with natural gas while he can continue to rail against the alleged environmental damage from that construction, not to mention the perceived undermining of “state’s rights”. While this week the DEC announced that it would continue to oppose the pipeline, it did not say how. Indeed, the Governor’s optimum political play now may be to find some way to appease his environmentalist supporters while he quietly allows the Constitution Pipeline to be built at the order of “overbearing” bureaucrats in Washington. All in all, it is not a bad position for Governor Cuomo to be in now.
Dan expresses a view that our good friend Tom Shepstone also holds–that Cuomo would like nothing more than for the courts (and FERC) to make him accept pipelines, fracking, et al. They maintain Cuomo is a Machiavellian genius who wants his cake (pandering to his leftist kook base) and to eat it too (get the natgas anyway). With all due respect to both men (whom we admire), we disagree. We don’t think Andy is that smart nor that savvy a politician. We think he really does want to block natural gas coming into the state. We think he’s that stupid.
Any way you slice it, whether Cuomo is smart-like-a-fox and wants the gas, or dumb-as-a-box-of-rocks and doesn’t, FERC has made the choice for him. NY is going to get the Constitution pipeline (and others like it), because not only does NY need it, so too does New England.
Editor’s Note: Let’s see what you, dear readers think about Andrew Cuomo motivations:
And, while we’re at it let’s see how you view FERC’s action in this case: