FERC reverses itself on a climate rule for approving natural gas pipelines
"Federal regulators rarely backtrack, especially as quickly as the Federal Energy Regulatory Commission. Yet on Thursday Democratic commissioners hit pause on a new policy requiring a greenhouse-gas analysis for natural gas pipelines and export projects. Good for them.
The commission last month voted 3-2 with Republicans in dissent to revise its policy for approving gas pipelines and export terminals. FERC by law must certify that projects are in the public interest and won’t have a significant environmental impact, but Democratic commissioners added greenhouse-gas emissions to their permission analyses. Their excuse was a court ruling that they claimed required the change, though it really doesn’t.
Indirect emissions from upstream production and downstream consumption could also have to be tabulated under the rule, even though these are impossible to quantify reliably. Who knows how much more gas will be produced if a pipeline is built? Rest assured, progressives will claim every new pipeline massively increases emissions.
On one point, they are right: Pipelines encourage more energy production. A dearth of U.S. pipeline capacity, especially in Appalachia, has suppressed investment in supply. Crude can be transported by rail or truck. Natural gas can’t. The U.S. also can’t send more liquefied gas to Europe without more pipelines and export terminals. FERC’s climate policy was a gift to Vladimir Putin.
His bloody war on Ukraine and weaponization of Russian gas against Europe illuminate the stakes. Perhaps Democratic commissioners were mugged by energy reality like the Europeans. We’re told Democratic commissioners were also stunned by the backlash in Congress, especially from Joe Manchin.
The West Virginia Senator blasted the commissioners from his own party at a hearing this month: “I believe you all took the direction from the court and applied it far more broadly than you needed to, setting in motion a process that will serve to further shut down the infrastructure we desperately need as a country and further politicize energy development in our country.”
Chairman Richard Glick on Thursday did a soft retreat by recasting last month’s policy statements as “drafts” on which FERC will seek public comment. “In light of concerns that the policy statements created further confusion about the Commission’s approach to the siting of natural gas projects, the Commission decided it would be helpful to gather additional comments from all interested stakeholders, including suggestions for creating greater certainty, before implementing the new policy statements,” he said.
We’ll take the reprieve. But the better way to eliminate investment uncertainty would be for FERC to rescind the proposal in toto."
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