United States: FERC Finds No Significant Additive Or Cumulative Impacts From Tennessee's Northeast Upgrade Project On Remand

On November 19, 2015, FERC issued an order on remand from the U.S. Court of Appeals for the D.C. Circuit ("D.C. Circuit") finding that, when considered with the other projects involving construction on the 300 Line pipeline, Tennessee Gas Pipeline, L.L.C.'s ("Tennessee") Northeast Upgrade Project does not result in significant additive or cumulative impacts. FERC originally held that it did not segment its environmental review of the Northeast Upgrade Project from that of the 300 Line Project and that its cumulative impacts analysis was not deficient. However, the D.C. Circuit remanded the additive and cumulative impacts analysis to FERC for further consideration.

On March 31, 2011, Tennessee filed an application requesting authorization to construct and operate the Northeast Upgrade Project, which consists of five pipeline loop segments totaling 40.3 miles of 30-inch-diameter pipeline, modifications and upgrades at four compressor stations, and one meter station. The Northeast Upgrade Project is one of four projects proposed by Tennessee involving construction on its 300 Line. The upgrade added capacity to Tennessee's 300 Line necessary to provide 646,000 dekatherms per day of firm transportation service. FERC developed an Environmental Assessment ("EA") for the Northeast Upgrade Project, including a cumulative effects analysis, finding that the project would result in no significant environmental impact. In a May 29, 2012 order ("Certificate Order"), FERC certificated the Northeast Upgrade Project and rejected claims that FERC had improperly segmented its environmental review of the Northeast Upgrade Project from that of the 300 Line Project. On rehearing, FERC affirmed its Certificate Order, further rejecting arguments that (1) it segmented its environmental review; (2) Tennessee's projects, including the Northeast Upgrade Project, impacting the 300 Line are functionally and economically interdependent; (3) the projects were not "connected" actions as defined in regulations implementing the National Environmental Policy Act ("NEPA"); and (4) the cumulative impacts analysis performed for the Northeast Upgrade Project was deficient for failing to consider impacts associated with other projects on the 300 Line.

After the Delaware Riverkeeper Network petitioned for review of the order on rehearing, the D.C. Circuit rejected FERC's determination that the four Tennessee projects were not "connected" actions, finding that the four projects constituted a complete upgrade of almost 200 miles of continuous pipeline. The D.C. Circuit also found that there was a clear physical, functional, financial, and temporal nexus between the four projects. Furthermore, the D.C. Circuit rejected FERC's argument that the Northeast Upgrade Project had substantial independent utility separate from the other projects because Tennessee had secured distinct contracts for service utilizing the incremental capacity to be created by the project. The D.C. Circuit considered the close timing of the four projects as a significant factor in determining whether the four projects were "connected" actions, noting that the Northeast Upgrade Project was included in a complete overhaul and upgrade and that FERC's consideration of the Northeast Upgrade Project overlapped with its consideration of the applications for other projects. Finally, the D.C. Circuit found that FERC's analysis of the cumulative impacts of the Northeast Upgrade Project lacked "serious consideration" given the close connection between the four projects. As a result, the D.C. Circuit remanded the segmentation and cumulative impacts issues for further consideration.

In response to the remand, FERC directed staff to prepare a supplemental analysis to examine the additive and cumulative environmental impacts of the four projects. The supplemental analysis concludes that, when the four projects are considered additively and cumulatively, none of the resource impacts escalated to a significant level or required additional mitigation. The supplemental analysis based these conclusions on facts including that the projects primarily consisted of looping segments; minimal construction occurred that required a new pipeline right-of-way corridor not adjacent to an existing pipeline; Tennessee overlapped the construction right-of-way for each of its four projects with its existing maintained easement where feasible; the limited geographic range of the impacts; the timeframe that the impacts occurred; and mitigation measures committed to and implemented by Tennessee and Dominion Transmission, Inc., which utilizes capacity on the 200 Line and 300 Line.

With respect to additive impacts, the supplemental analysis found that most of the impacts from the four projects were temporary and limited in geographic scope. For other impacts, such as air quality affected by the associated compressor stations, the supplemental analysis explained that the operational emission source must be considered separately because each of the compressor stations is a discrete emissions source, and that based on modeling, emissions from one facility would be at de minimis levels before reaching the air space of the next compressor station. With respect to cumulative impacts, the supplemental analysis found that cumulative impacts were minor and limited to the resources where the 300 Line Project and the Northeast Upgrade Project overlap geographically. In addition, the supplemental analysis found no significant additive or cumulative impacts on forested areas, wetlands, or groundwater. In the order on remand, FERC agreed with the conclusions presented in the supplemental analysis and found that when the four projects are considered additively, none of the resource impacts escalated to a significant level, and that there were no significant cumulative impacts. Thus, FERC found that no additional mitigation is required beyond the measures required in the Certificate Order.

A copy of the order is available here.

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