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Released June 16, 2020 | SUGAR LAND
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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--It may come too late for some energy infrastructure projects, but just in time for others: On June 1 the Environmental Protection Agency (EPA) (Washington, D.C.) finalized changes to the federal Clean Water Act (CWA) that would sharply limit states' and tribes' ability to block construction of infrastructure projects.
Some states have used CWA Section 401 to delay or deny energy projects, such as the Northeast Supply Enhancement Pipeline, the Constitution Grassroot Natural Gas Pipeline, the Northern Access Pipeline, the Jordan Cove Grassroot liquefied natural gas production plant, the Longview Columbia River Terminal Coal Export Terminal, the PennEast Pipeline project and others. Some of these projects have been cancelled, others have been placed on hold or delayed due to permitting issues.
The EPA's June 1 move was widely criticized by officials in New York, California and Washington state but hailed by developers and energy trade groups frustrated by prolonged delays in securing CWA Section 401 permits.
Legal experts expect litigation and raised questions about whether the changes to the five-decade-old law would comply with a decades-old U.S. Supreme Court decision. Some even said the changes created a perverse incentive for states to deny permits for proposed projects, likely triggering lawsuits that could further delay a proposed project.
The changes may have been finalized with an eye on the November elections. If the Democrats win both the House and Senate in November, they could vote to overturn the changes. Congressional Review Act (CRA) allows a newly elected Congress to roll back any major rules enacted by an executive level agency like the EPA that were finalized in the last 60 legislative days of the previous congressional session. With Congress' work schedule in flux due to the COVID-19 pandemic, it is not clear if Congress even has 60 working days before Election Day on November 3.
The changed adopted by the EPA were pursuant to an April 2019 executive order by President Donald Trump to promote energy infrastructure and economic growth. That order directed the EPA to review Section 401 of the CWA to determine whether the agency's policies should be updated or clarified.
The EPA's June 1 final rule modified CWA Section 401 to limit to one year the amount of time a state or tribe has to issue or deny a water permit for a proposed project. It also dramatically cut back a state's purview on Section 401 permits, limiting its review to whether a proposed project may result in a discharge from a point source into a water of the United States. When states look at issues other than the impact on water quality, such as contribution to climate change, they go beyond the scope of the Clean Water Act, the EPA said in a statement.
New York, New Jersey, Washington state and Oregon, among other states, have delayed or denied energy projects a CWA Section 401 permit based on their potential to contribute to global warming or other reasons not directly related to whether a proposed project will have discharges that pollute a body of water.
"EPA is returning the Clean Water Act certification process under Section 401 to its original purpose, which is to review potential impacts that discharges from federally permitted projects may have on water resources, not to indefinitely delay or block critically important infrastructure," EPA Administrator Andrew Wheeler said in a statement. The revision is designed to "to curb abuses of the Clean Water Act that have held our nation's energy infrastructure projects hostage, and to put in place clear guidelines that finally give these projects a path forward."
In a subsequent conference call with reporters, Wheeler said: "Now you won't be able to use (Section) 401 in the future citing climate change as the reason" for denying a CWA permit to a project. With the changes, he added, states can no longer "hold the nation's energy infrastructure hostage."
Energy interests cheered the move. Karen A. Harbert, president and chief executive of the American Gas Association (AGA) (Washington, D.C.), praised the changes and described states' objections to pipelines and other projects as "abuse." She said the new final rule "will end the practice of states misusing Section 401, putting political ideology and the goal of blocking natural gas pipelines over the important task of protecting our nation's water quality."
Thomas Pyle, President of the American Energy Alliance (Washington, D.C.), made this comment, "President Trump and EPA Administrator Andrew Wheeler were left with no choice but to respond to the blatant misuse of the Clean Water Act by New York Governor Andrew Cuomo and others. Activist judges and environmental extremists continue to misuse the legal system to prevent the safe and responsible production and transportation of America's energy. Today's announcement will limit at least one of the weapons being used to abuse our legal system."
"The 'Keep it in the Ground' movement has failed time after time to prevent our boundless supplies of natural gas, oil, and coal from being used to power the economy and lift millions out of energy poverty around the world," Pyle continued. "So instead, they shifted their strategy to abusing environmental laws like the Clean Water Act to keep these resources from moving around via pipeline and other modes of transportation."
An equally full-throated denunciation of the move came from state officials and environmental organizations, setting the stage for litigation.
"In the latest example of the Trump administration's disdain for the rule of law, it is trying to excise states' clean water rights to object to projects that violate state water quality standards," David Hayes, who runs the State Energy & Environmental Impact Center at the New York University School of Law, told The New York Times.
The Times also noted that clean water law experts pointed to a U.S. Supreme Court from 1994 that explicitly affirmed states' authority to impose conditions on projects based on state law.
Democratic attorneys general and lawmakers vowed to fight to reverse the rule. Rep. Debbie Dingell (D-Mich.) tweeted, "This decision is unconscionable, and I'll do everything in my power to oppose it." And California Attorney General Xavier Becerra suggested he and others would sue the EPA, saying in a statement, "We won't stand idly by as they rip away our authority under the law to preserve water quality." These comments were reported by The Washington Post.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
Some states have used CWA Section 401 to delay or deny energy projects, such as the Northeast Supply Enhancement Pipeline, the Constitution Grassroot Natural Gas Pipeline, the Northern Access Pipeline, the Jordan Cove Grassroot liquefied natural gas production plant, the Longview Columbia River Terminal Coal Export Terminal, the PennEast Pipeline project and others. Some of these projects have been cancelled, others have been placed on hold or delayed due to permitting issues.
The EPA's June 1 move was widely criticized by officials in New York, California and Washington state but hailed by developers and energy trade groups frustrated by prolonged delays in securing CWA Section 401 permits.
Legal experts expect litigation and raised questions about whether the changes to the five-decade-old law would comply with a decades-old U.S. Supreme Court decision. Some even said the changes created a perverse incentive for states to deny permits for proposed projects, likely triggering lawsuits that could further delay a proposed project.
The changes may have been finalized with an eye on the November elections. If the Democrats win both the House and Senate in November, they could vote to overturn the changes. Congressional Review Act (CRA) allows a newly elected Congress to roll back any major rules enacted by an executive level agency like the EPA that were finalized in the last 60 legislative days of the previous congressional session. With Congress' work schedule in flux due to the COVID-19 pandemic, it is not clear if Congress even has 60 working days before Election Day on November 3.
The changed adopted by the EPA were pursuant to an April 2019 executive order by President Donald Trump to promote energy infrastructure and economic growth. That order directed the EPA to review Section 401 of the CWA to determine whether the agency's policies should be updated or clarified.
The EPA's June 1 final rule modified CWA Section 401 to limit to one year the amount of time a state or tribe has to issue or deny a water permit for a proposed project. It also dramatically cut back a state's purview on Section 401 permits, limiting its review to whether a proposed project may result in a discharge from a point source into a water of the United States. When states look at issues other than the impact on water quality, such as contribution to climate change, they go beyond the scope of the Clean Water Act, the EPA said in a statement.
New York, New Jersey, Washington state and Oregon, among other states, have delayed or denied energy projects a CWA Section 401 permit based on their potential to contribute to global warming or other reasons not directly related to whether a proposed project will have discharges that pollute a body of water.
"EPA is returning the Clean Water Act certification process under Section 401 to its original purpose, which is to review potential impacts that discharges from federally permitted projects may have on water resources, not to indefinitely delay or block critically important infrastructure," EPA Administrator Andrew Wheeler said in a statement. The revision is designed to "to curb abuses of the Clean Water Act that have held our nation's energy infrastructure projects hostage, and to put in place clear guidelines that finally give these projects a path forward."
In a subsequent conference call with reporters, Wheeler said: "Now you won't be able to use (Section) 401 in the future citing climate change as the reason" for denying a CWA permit to a project. With the changes, he added, states can no longer "hold the nation's energy infrastructure hostage."
Energy interests cheered the move. Karen A. Harbert, president and chief executive of the American Gas Association (AGA) (Washington, D.C.), praised the changes and described states' objections to pipelines and other projects as "abuse." She said the new final rule "will end the practice of states misusing Section 401, putting political ideology and the goal of blocking natural gas pipelines over the important task of protecting our nation's water quality."
Thomas Pyle, President of the American Energy Alliance (Washington, D.C.), made this comment, "President Trump and EPA Administrator Andrew Wheeler were left with no choice but to respond to the blatant misuse of the Clean Water Act by New York Governor Andrew Cuomo and others. Activist judges and environmental extremists continue to misuse the legal system to prevent the safe and responsible production and transportation of America's energy. Today's announcement will limit at least one of the weapons being used to abuse our legal system."
"The 'Keep it in the Ground' movement has failed time after time to prevent our boundless supplies of natural gas, oil, and coal from being used to power the economy and lift millions out of energy poverty around the world," Pyle continued. "So instead, they shifted their strategy to abusing environmental laws like the Clean Water Act to keep these resources from moving around via pipeline and other modes of transportation."
An equally full-throated denunciation of the move came from state officials and environmental organizations, setting the stage for litigation.
"In the latest example of the Trump administration's disdain for the rule of law, it is trying to excise states' clean water rights to object to projects that violate state water quality standards," David Hayes, who runs the State Energy & Environmental Impact Center at the New York University School of Law, told The New York Times.
The Times also noted that clean water law experts pointed to a U.S. Supreme Court from 1994 that explicitly affirmed states' authority to impose conditions on projects based on state law.
Democratic attorneys general and lawmakers vowed to fight to reverse the rule. Rep. Debbie Dingell (D-Mich.) tweeted, "This decision is unconscionable, and I'll do everything in my power to oppose it." And California Attorney General Xavier Becerra suggested he and others would sue the EPA, saying in a statement, "We won't stand idly by as they rip away our authority under the law to preserve water quality." These comments were reported by The Washington Post.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
