FERC’s Certification of New Interstate Natural Gas Facilities: Revising the 1999 Policy Statement for 21st Century Conditions
White Paper, November 2019
Analysis Group Senior Advisor Susan Tierney, with funding from the Sustainable FERC Project at the National Resources Defense Council (NRDC), published a report responding to a Federal Energy Regulation Commission (FERC) inquiry into whether its 1999 Natural Gas Pipeline Policy Statement requires changes. The 1999 statement relied, in part, on precedent agreements between pipeline developers and potential shippers to demonstrate need for proposed interstate natural gas projects. With more than 1,600 responses from organizations and individuals, the 2018 inquiry suggested a strong public investment in FERC’s process, policies, and decision about whether to revise its Policy Statement.
Dr. Tierney’s report first summarizes key themes emerging from the comment period from both supporters of the status quo and proponents for change. It then discusses key findings and concludes that they weigh in favor of FERC making important changes in its approach to reviewing and, where appropriate, approving projects. The focus of attention in such recommended changes is to ensure that FERC only approves pipelines that are in the public interest.
Finally, the report provides recommendations for changes that FERC should make in its pipeline certification process, including broadening the basis for demonstrating project need to include consideration of benefit/cost analyses, externalities such as the economic costs of environmental impacts, and other impacts on relevant stakeholder groups.