Interstate Natural Gas Pipelines: Process and
Timing of FERC Permit Application Review
Paul W. Parfomak
Specialist in Energy and Infrastructure Policy
November 19, 2013
Congressional Research Service
7-5700
www.crs.gov
R43138
CRS Report for Congress
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epared for Members and Committees of Congress
Interstate Natural Gas Pipelines: Process & Timing of FERC Permit Application Review
Summary
Growth in U.S. shale gas production involves the expansion of natural gas pipeline infrastructure
to transport natural gas from producing regions to consuming markets, typically in other states.
Over 300,000 miles of interstate transmission pipeline already transport natural gas across the
United States. However, if the growth in U.S. shale gas continues, the requirement for new
pipelines could be substantial. This ongoing expansion has increased congressional interest in the
role of the federal government in the certification (permitting) of interstate natural gas pipelines.
Under Section 7(c) of the Natural Gas Act of 1938, the Federal Energy Regulatory Commission
(FERC) is authorized to issue certificates of “public convenience and necessity” for “the
construction or extension of any facilities ... for the transportation in interstate commerce of
natural gas.” Thus, companies seeking to build interstate natural gas pipelines must first obtain
certificates of public convenience and necessity from FERC. The Energy Policy Act of 2005
(EPAct) designates FERC as the lead agency for coordinating “all applicable Federal
authorizations” and for National Environmental Policy Act (NEPA) compliance in reviewing
pipeline certificate applications.
There are no statutory time limits within which FERC must complete its certificate review
process. However, EPAct authorizes FERC to establish a schedule for all related federal
authorizations and provides for judicial petition if an agency fails to comply with that schedule.
Congress included these provisions in EPAct to address concerns that some interstate gas pipeline
and other energy infrastructure approvals were being unduly delayed by a lack of coordination or
insufficient action among agencies involved in the certification process. FERC has promulgated
regulations requiring certificate-related final decisions from other agencies no later than 90 days
after the commission issues its final environmental document.
Notwithstanding the EPAct provisions, there is continuing concern by some in the gas industry
and in Congress that FERC review of pipeline certificate applications can still take too long. The
Natural Gas Pipeline Permitting Reform Act (H.R. 1900) seeks to expedite the federal review of
certificate applications by imposing deadlines on the agencies involved. H.R. 1900 would impose
an explicit 12-month deadline on FERC certificate reviews for projects using FERC’s pre-filing
procedures and would codify the commission’s 90-day regulatory deadline for any certificate-
related agency decisions. Any agency decision not meeting the 90-day deadline would be
approved by default.
The optimal time for any deadline that Congress might impose on FERC or cooperating agencies
is open to debate. The 12-month deadline in H.R. 1900 would be approximately the same as the
average FERC certificate review time today. However, 12 months could represent a reduction in
the review time that might be expected for atypically lengthy or complex pipeline projects. In
light of FERC’s recent record approving new gas pipelines, FERC commissioners have been
neutral or modestly supportive towards legislative proposals for stronger certificate review
authorities. However, deadlines imposed on FERC or cooperating agencies could raise the
possibility that they might deny permits for some projects solely on the grounds that they lack
sufficient time for an adequate review. The ability of FERC and any other federal or state
agencies it works with to expedite their parts of certificate review to meet an expedited schedule
may be limited by available resources.
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Interstate Natural Gas Pipelines: Process & Timing of FERC Permit Application Review
Contents
Introduction ...................................................................................................................................... 1
FERC Pipeline Certification Process ............................................................................................... 1
Pre-Filing and Environmental Review ...................................................................................... 2
Application for FERC Certificate .............................................................................................. 2
Environmental Review .............................................................................................................. 3
Certificate Authorities ............................................................................................................... 5
Post-Certificate Proceedings ..................................................................................................... 6
Timing of FERC Certification and H.R. 1900 ................................................................................. 6
The Natural Gas Pipeline Permitting Reform Act ..................................................................... 7
Recent F.E.R.C. Perspectives .............................................................................................. 9
Potential Effects of H.R. 1900 ......................................................................................................... 9
12-Month Certification Deadline ............................................................................................... 9
Codifying the 90-Day Agency Deadline ................................................................................. 11
Default Approval of Delayed Agency Decisions ..................................................................... 11
Resource Considerations ......................................................................................................... 12
Figures
Figure 1. FERC Review Process for Natural Gas Pipeline Certificates .......................................... 4
Figure 2. U.S. Natural Gas Transmission Pipeline Capacity Additions ........................................... 8
Appendixes
Appendix. Statutory Deadlines for Energy Permits ....................................................................... 13
Contacts
Author Contact Information........................................................................................................... 14
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Interstate Natural Gas Pipelines: Process & Timing of FERC Permit Application Review
Introduction
The United States’ supply of natural gas is growing due to technological improvements, such as
horizontal drilling and hydraulic fracturing, which have increased producers’ ability to extract
natural gas from shale formations. Shale gas is projected to become the dominant source of the
U.S. natural gas supply by 2040.1 The growth in U.S. shale gas production requires the expansion
of natural gas pipeline infrastructure at the local level (to extract and gather the gas) and at the
national level to transport natural gas from producing regions to consuming markets, typically in
other states. Over 300,000 miles of interstate transmission pipeline already transport natural gas
across the United States.2 However, if the growth in U.S. shale gas continues as projected, the
requirement for new pipelines could be substantial. For example, an analysis by the INGAA
Foundation, a pipeline industry research organization, estimates that the total cost of new gas
gathering and transmission pipelines, including storage, could average over $8 billion per year
and total over $200 billion through 2035.3 This ongoing expansion has increased congressional
interest in the role of the federal government in the certification (permitting) of interstate natural
gas pipelines. The only schedule-related legislative proposal to date in the current Congress is the
Natural Gas Pipeline Permitting Reform Act (H.R. 1900), which seeks to expedite the federal
review of certificate applications by imposing deadlines on the agencies involved.4
This report provides an overview of the federal certification process for interstate natural gas
pipelines. It discusses the length of the review for recent interstate gas pipeline applications—a
topic of specific interest to Congress and industry. In this context, the report discusses the key
provisions in H.R. 1900 and their implications for gas pipeline certificate approval. Issues
associated with Presidential Permits for natural gas pipelines crossing the international border are
discussed in CRS Report R43261, Presidential Permits for Border Crossing Energy Facilities, by
Adam Vann and Paul W. Parfomak.
FERC Pipeline Certification Process
Under Section 7(c) of the Natural Gas Act of 1938 (NGA), the Federal Energy Regulatory
Commission (FERC) is authorized to issue certificates of “public convenience and necessity” for
“the construction or extension of any facilities ... for the transportation in interstate commerce of
natural gas” (15 U.S.C. §717f(c)). Thus, companies seeking to build interstate natural gas
pipelines must first obtain certificates of public convenience and necessity from FERC.5 FERC’s
1 U.S. Energy Information Administration, Annual Energy Outlook 2013 Early Release Overview, December 5, 2012,
p. 2, http://www.eia.gov/forecasts/aeo/er/index.cfm.
2 Pipeline and Hazardous Material Safety Administration, “Annual Report Mileage for Natural Gas Transmission and
Gathering Systems,” web page, April 30, 2013, http://phmsa.dot.gov/portal/site/PHMSA/
menuitem.ebdc7a8a7e39f2e55cf2031050248a0c/?vgnextoid=78e4f5448a359310VgnVCM1000001ecb7898RCRD&
vgnextchannel=3b6c03347e4d8210VgnVCM1000001ecb7898RCRD&vgnextfmt=print.
3 INGAA Foundation, “North American Natural Gas Midstream Infrastructure Through 2035: A Secure Energy
Future,” June 28, 2011, http://www.ingaa.org/File.aspx?id=14911. The INGAA Foundation is affiliated with the
Interstate Natural Gas Association of America (INGAA), the interstate gas pipeline industry trade assocaition.
4 The bill was introduced on May 9, 2013, by Representative Mike Pompeo and 11 cosponsors.
5 FERC must also approve the abandonment of gas facility use and services. The commission does not have similar
siting authority over oil pipelines, nor over natural gas pipelines located entirely within a state’s borders not involved in
interstate commerce. Siting of oil and intrastate natural gas pipelines is, instead, variously regulated by the states.
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regulatory process for interstate gas pipeline certification consists of several principal steps,
which may vary somewhat depending upon whether or not a pipeline developer opts to enter into
a voluntary pre-filing process before formally applying for a pipeline certificate.
Pre-Filing and Environmental Review
Prior to applying to FERC for a pipeline certificate, developers may file a request with FERC to
use the commission’s pre-filing procedures (18 CFR §157.21). The commission established the
pre-filing process to encourage the pipeline industry to engage in early project-development
involvement with the relevant public and government agencies. Through this process a developer
notifies all stakeholders—including state, local, and other federal agencies, and potentially
affected property owners—about a proposed project so that the developer and commission staff
can provide a forum to hear stakeholder concerns. The pipeline developer may then incorporate
proposed environmental mitigation measures into the project design, taking into account
stakeholder input. The expectation is that the pre-filing will improve a developer’s proposal and
avoid problems during the review of a subsequent FERC certificate application.
The pre-filing process involves a set of specific activities by the developer. These activities would
typically include the study of potential project sites, identifying stakeholders, and holding an open
house for stakeholders to discuss the project. At the conclusion of pre-filing, the developer
conducts pipeline route studies and field surveys to develop a final application and submit it to
FERC. Concurrent with the developer’s activities, FERC staff participate in the open house and
publish in the Federal Register a Notice of Intent for Preparation of an Environmental
Assessment or an Environmental Impact Statement (40 CFR §1508.22), opening a scoping period
to seek public comments. FERC consults with interested stakeholders, including government
agencies, and also holds public scoping meetings and site visits in the proposed project area.6
Although pre-filing precedes a certificate application, it is, nonetheless, part of the regulatory
process and requires a written request to FERC’s Office of Energy Projects. Developers wishing
to begin the pre-filing process must do so seven to eight months prior to filing a certificate
application.7 If the commission approves pre-filing, it will issue to the developer a pre-filing
docket number establishing an official public record associated with the proposed pipeline
project. There is, however, no provision at this stage for third parties to become formal
“intervenors” in the pre-filing process, further discussed below.
Application for FERC Certificate
A pipeline developer formally files an application with FERC for a certificate of public
convenience and necessity. Among other requirements, the application must contain a description
of the proposed pipeline, route maps, construction plans, schedules, and a list of other statutory
and regulatory requirements, such as permits needed from other agencies. The application must
also include environmental reports analyzing route alternatives and studies of potential
environmental impacts (on water, plants, and wildlife), cultural resources, socioeconomics, soils,
6 Federal Energy Regulatory Commission, “EIS Pre-Filing Environmental Review Process,” web page, May 28, 2013,
http://www.ferc.gov/help/processes/flow/process-eis.asp.
7 Federal Energy Regulatory Commission, “Guidance: FERC Staff NEPA Pre-Filing Process for Natural Gas Projects,”
2004, http://www.fws.gov/habitatconservation/gas_prefiling_FERC_staff_NEPA_guidance_2004.pdf.
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geology, aesthetic resources, and land use. Upon receiving an application, the commission issues
a public Notice of Application for authorization to construct and operate a new pipeline in the
Federal Register and begins the application review process.
FERC’s decision whether to grant or deny a pipeline certificate is based upon a determination
whether the pipeline project would be in the public interest. FERC accounts for several factors,
including a project’s potential impact on pipeline competition, the possibility of overbuilding,
subsidization by existing customers, potential environmental impacts, avoiding the unnecessary
use of eminent domain, and other considerations.8 FERC may also take into account safety
concerns, but generally defers to the Department of Transportation, which has primary authority
to regulate pipeline safety under the Natural Gas Pipeline Safety Act of 1968 and subsequent
acts.9 Of the factors above, environmental review typically comprises the bulk of FERC’s review.
Key aspects of this review process are illustrated in Figure 1 and further discussed below.
Environmental Review
Among other factors, review of certificate applications requires examination of environmental
impacts of the action in compliance with the National Environmental Policy Act (NEPA, 42
U.S.C. §4321 et seq.) and associated regulations promulgated by the Council of Environmental
Quality (CEQ, 40 C.F.R. §§1500-1508). NEPA requires federal agencies to consider the potential
environmental impacts of an action (e.g., granting a pipeline certificate) and to inform the public
of those potential impacts before proceeding with that action. The Energy Policy Act of 2005
(P.L. 109-58, EPAct) designates FERC as the lead agency for coordinating NEPA compliance and
“all applicable Federal authorizations” in reviewing pipeline certificate applications (§313(b)).
If the applicant did not pre-file, FERC begins the environmental review process by publishing a
Notice of Intent for Preparation of an Environmental Assessment or an Environmental Impact
Statement. In reviewing environmental impacts associated with a certificate, the commission
typically prepares an environmental assessment (EA), which is “a concise public document”
intended to “briefly provide sufficient evidence and analysis” to determine whether a finding of
no significant impact can be issued (40 C.F.R. §§1508.9). If the EA determines impacts are
significant, a more extensive and detailed environmental impact statement (EIS) must be prepared
(42 U.S.C. §4332(C)).10 If FERC determines a project falls within a category of activities that has
already been found to have no significant environmental impact, the commission may classify it
as a “categorical exclusion.” For example, one of FERC’s categorical exclusions allows certain
pipeline construction and modification projects under “blanket” certificate applications and prior
notice filings (18 C.F.R §380.4a(21)). As such, they are categorically excluded from the
requirement to prepare an EIS or EA (18 C.F.R §380.4a).
8 Federal Energy Regulatory Commission, Certification of New Interstate Natural Gas Pipeline Facilities (Policy
Statement), 88 FERC ¶ 61,227, 1999 and orders clarifying policy, 90 FERC ¶ 61,128 and 92 FERC ¶ 61,094, 2000 as
summarized in Caroyln Elefant, “Knowing and Protecting Your Rights When an Interstate Gas Pipeline Comes to Your
Community,” white paper, Law Offices of Carolyn Elefant, Washington, DC, May 17, 2010,
http://lawofficesofcarolynelefant.com/wp-content/uploads/2010/06/FINALTAGguide.pdf.
9 Pipeline safety regulations are covered in Title 49 of the Code of Federal Regulations. In granting pipeline
certificates, FERC requires that developers comply with DOT pipeline safety standards for design, construction,
operation, and maintenance. For further analysis, see CRS Report R41536, Keeping America’s Pipelines Safe and
Secure: Key Issues for Congress, by Paul W. Parfomak.
10 Federal Energy Regulatory Commission, “Preparing Environmental Documents,” Sept. 2008, p. v,
http://www.ferc.gov/industries/hydropower/gen-info/guidelines/eaguide.pdf.
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Figure 1. FERC Review Process for Natural Gas Pipeline Certificates
Source: Federal Energy Regulatory Commission, “Processes for Natural Gas Certficates,” web page, May 28,
2013, http://www.ferc.gov/help/processes/flow/gas-2.asp.
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When an EIS is required, it is generally prepared in two stages: a draft and final EIS. Among
other requirements, the EIS must include a statement of the purpose and need for the proposed
project, a description of all reasonable alternatives to meet that purpose and need, a description of
the environment that would be affected by those alternatives, and an analysis of the direct and
indirect effects of the alternatives, including cumulative impacts. In preparing an EIS, FERC is
the “lead agency” required to obtain input from other “cooperating agencies” with jurisdiction by
law or with special expertise regarding any environmental impact associated with the project (40
C.F.R. §1508.5). Cooperating agencies for a pipeline project often include the Environmental
Protection Agency; the Department of Transportation’s Pipeline and Hazardous Materials Safety
Administration; the Department of the Interior’s Bureau of Land Management, Fish and Wildlife
Service, and National Park Service; and the Army Corps of Engineers, among others.
After FERC staff complete their environmental analysis and cooperating agency consultations
regarding a certificate application, the commission issues a draft EIS that will include its initial
recommendations for approval or denial of the pipeline certificate. Issuance of the draft EIS also
begins a public comment period of at least 45 days, during which FERC will hold public
meetings in the proposed project area.11 Notice of the availability of the draft EIS for public
comment and the times and locations of public meetings are published in the Federal Register.
Although FERC considers all public comments in its application review, simply filing comments
does not make a commentor a party to the certificate proceeding. Only intervenors to the
proceeding have the right to file briefs, attend hearings, and appeal the commission’s decision
regarding the certificate. They may also challenge final commission actions in the U.S. Circuit
Courts of Appeal. Any person seeking to become a party to the proceeding must file a motion to
intervene pursuant to the commission’s rules (18 C.F.R. §385.214). Interevenors receive the
certificate applicant’s filings and other FERC documents related to the case, as well as materials
filed by other interested parties.12
After the conclusion of the public comment period for the draft EIS, FERC reviews the comments
it received and revises its draft EIS as necessary in response to comments. When these revisions
are completed, FERC issues a final environmental statement with final recommendations for
approval or denial of the certificate. Under NEPA, a final agency record of decision—in this
context a FERC order—cannot be issued until at least 30 days after FERC publishes a notice of
availability of the final EIS (40 C.F.R. §1506.10(b)(2)). However, there is no additional
opportunity for public comment after the final EIS is issued. After the 30-day period is over, the
commission may issue an order approving or denying the pipeline certificate application.
Certificate Authorities
If FERC grants a pipeline certificate, the commission’s order will state the terms and conditions
of the approval, including the pipeline route that has been authorized, as well as any construction
or environmental mitigation measures required for the project. A FERC certificate confers on the
developer eminent domain authority (15 U.S.C. §717f(h)). Also, federal law preempts any state or
local law that duplicates or obstructs that federal law (e.g., siting or zoning) relevant to the
11 FERC usually establishes a 45-day comment period, the minimum required under 40 C.F.R. §1506.10(c). In some
cases involving very large projects or complex environmental issues, FERC has established longer periods.
12 Intervenors are also obligated to mail copies of their own filings to all other parties to the proceeding.
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project. In this way a FERC certificate provides a pipeline developer with the authority to secure
property rights to lay the pipeline if the developer cannot secure the necessary rights-of-way from
landowners through negotiation. In practice, however, eminent domain authority is considered a
last resort and is seldom used by developers.
Although a FERC certificate authorizes a pipeline under the Natural Gas Act, it cannot preempt
other federal laws that may apply—such as the Endangered Species Act, the Coastal Zone
Management Act, or the Clean Water Act—so any requirements under other federal statutes must
still be met by the developer. These may include, for example, securing authorizations for water
crossings from the Army Corps of Engineers, permission to cross federal lands from the Bureau
of Land Management, and other federal approvals. A developer must secure these other federal
approvals before proceeding with pipeline construction.
Post-Certificate Proceedings
Once FERC issues an order granting or denying a pipeline certificate, parties to the proceeding
(e.g., intervenors) who object to the order for any reason may formally request a rehearing so that
the commission can reconsider its decision. A party to the proceeding must file a request for
rehearing within 30 days after issuance of the final order—a statutory deadline which the
commission cannot waive or extend (15 U.S.C. §717(r)). There is no time limit for FERC to
consider or conclude a rehearing. If a pipeline certificate is approved after rehearing, the pipeline
project may proceed even if additional challenges have been filed in federal court. Once the
developer has provided FERC with any outstanding information or taken other actions to satisfy
the terms and conditions of the certificate order, including an implementation plan, FERC can
issue a Notice to Proceed with Construction Activities and construction can begin. The pipeline
developer must then file weekly status reports with the commission documenting project
inspection and certificate compliance until construction is completed.
Timing of FERC Certification and H.R. 1900
There are no statutory time limits within which FERC must complete its own certificate review
process, issue an order, or complete a rehearing. However, EPAct authorizes FERC to establish a
schedule for all federal authorizations and provides for judicial petition “if a Federal or State
administrative agency” fails to comply with that schedule (§313(c)). Congress included these
provisions in EPAct to address concerns that some interstate gas pipeline and other energy
infrastructure approvals were being unduly delayed by a lack of coordination or insufficient
action among agencies involved in the certification process.13 FERC has promulgated regulations
under the EPAct authority requiring certificate-related final decisions from federal agencies or
state agencies (acting pursuant to delegated federal authority) no later than 90 days after the
commission issues its final environmental document, unless another schedule is established by
federal law (18 C.F.R §157.22).
13 Senate Committee on Environment and Public Works, Oversight Hearing to Review the Permitting of Energy
Projects, S. Hrg. 109-856, May 25, 2005.
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The Natural Gas Pipeline Permitting Reform Act
The Natural Gas Pipeline Permitting Reform Act (H.R. 1900) would strengthen the EPAct
provisions by imposing a 12-month deadline on FERC certificate reviews for projects using
FERC’s pre-filing procedures and by codifying the commission’s 90-day regulatory deadline for
any certificate-related agency decisions. Any agency decision not meeting the 90-day deadline
would be approved by default. The relevant provisions in the bill as amended are as follows:
(i)(1) The Commission shall approve or deny an application for a certificate of public
convenience and necessity for a prefiled project not later than 12 months after receiving a
complete application that is ready to be processed, as defined by the Commission by
regulation.
(2) The agency responsible for issuing any license, permit, or approval required under
Federal law in connection with a prefiled project for which a certificate of public
convenience and necessity is sought under this Act shall approve or deny the issuance of the
license, permit, or approval not later than 90 days after the Commission issues its final
environmental document relating to the project.
(3) The Commission may extend the time period under paragraph (2) by 30 days if an agency
demonstrates that it cannot otherwise complete the process required to approve or deny the
license, permit, or approval, and therefor will be compelled to deny the license, permit, or
approval. In granting an extension under this paragraph, the Commission may offer technical
assistance to the agency as necessary to address conditions preventing the completion of the
review of the application for the license, permit, or approval.
(4) If an agency described in paragraph (2) does not approve or deny the issuance of the
license, permit, or approval within the time period specified under paragraph (2) or (3), as
applicable, such license, permit, or approval shall take effect upon the expiration of 30 days
after the end of such period. The Commission shall incorporate into the terms of such
license, permit, or approval any conditions proffered by the agency described in paragraph
(2) that the Commission does not find are inconsistent with the final environmental
document.
H.R. 1900 addresses continuing concern by some in the gas industry and in Congress that, despite
the EPAct provisions, FERC review of gas pipeline certificate applications can still take too long,
in large part because other involved agencies have not been complying with FERC’s 90-day
deadline for agency decisions. Under EPAct, the possibility of judicial action is the only
consequence of failing to meet FERC’s deadlines—and it may not be sufficient. A December
2012 study by the INGAA Foundation concluded that, despite the schedule provisions in EPAct
2005 intended to expedite the review of FERC certificate applications for gas pipelines,
“anecdotal evidence has suggested that the time required to secure regulatory approvals for such
projects is increasing.”14 The study reported that nearly 20% of FERC certifications in the study
sample were delayed 90 days or longer beyond FERC’s agency deadline.15 According to the
report, few developers have petitioned the courts to compel agency compliance with FERC’s 90-
day deadline, perhaps because that process, like any litigation, can be costly and time-consuming
as well, with its own sources of delay.
14 INGAA Foundation, Expedited Federal Authorization of Interstate Natural Gas Pipelines: Are Agencies Complying
with EPAct?, Washington, DC, December 21, 2012, p. 2.
15 Ibid., p. 14.
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Notwithstanding the findings of the INGAA Foundation study, whether FERC’s existing
authorities and process for pipeline certification adequately meet the needs of the market for new
pipeline infrastructure is open to debate. A February 2013 Government Accountability Office
(GAO) study of FERC pipeline certificate reviews reported that the average time from pre-filing
to certification was 558 days (18.6 months), and the review time was 225 days (7.5 months) for
projects—typically smaller ones—that skipped pre-filing and began at the application phase.16
However, the pre-filing process (18 CFR §157.21) takes place prior to a developer’s applying to
FERC for a pipeline certificate, which is when the 12-month “clock” under H.R. 1900 would
start. Unfortunately, the GAO study did not report how many of the 558 days for the pre-filed
applications were after the applications were actually filed. In 2004 regulatory guidance, FERC
states that developers wishing to begin the pre-filing process must do so at least seven months
(210 days) prior to filing a certificate application.17 Subtracting an estimated 210-day pre-filing
period from the 558 days reported by GAO for the whole process suggests a post-application
review period of at most 348 days, or about 11.6 months, on average, for projects that pre-filed.
As Figure 2 shows, federal and state agencies have approved numerous pipelines associated with
the rapid expansion of U.S. shale gas production since EPAct. In particular, FERC-regulated gas
transmission capacity increased quickly with the onset of the shale gas expansion in 2007-2008
and continues to grow.
Figure 2. U.S. Natural Gas Transmission Pipeline Capacity Additions
(Billion cubic feet per day)
Source: Energy Information Administration, “U.S. Natural Gas Pipeline Projects,” spreadsheet, January 25, 2103,
http://www.eia.gov/naturalgas/data.cfm. Figures are based on regulatory filings, industry information and company
reports.
Notes: 2013 figures are anticipated. General y, only transmission lines are included; gathering lines, distribution
lines, and liquefied natural gas marine terminals are excluded. Both interstate and intrastate transmission
pipelines are included.
16 Government Accountability Office (GAO), Pipeline Permitting: Interstate and Intrastate Natural Gas Permitting
Processes Include Multiple Steps, and Time Frames Vary, GAO-13-221, February 2013, p. 26. Note that the projects
GAO reviewed “varied in size and function and included pipelines, pipeline expansions, compressor stations, and other
pipeline facilities,” so its calculations of the time required for certification may not be generalizable to any specific
future project.
17 Federal Energy Regulatory Commission, “Guidance: FERC Staff NEPA Pre-Filing Process for Natural Gas
Projects,” 2004, http://www.fws.gov/habitatconservation/gas_prefiling_FERC_staff_NEPA_guidance_2004.pdf.
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Recent F.E.R.C. Perspectives
In light of their recent record approving new gas pipelines, FERC commissioners have been
neutral or modestly supportive towards legislative proposals for stronger certificate review
authorities. In March 2013, FERC Commissioner Cheryl LaFleur stated in her written testimony
before the House Committee on Energy and Commerce, Subcommittee on Energy and Power,
that the nation’s system for expanding pipeline capacity “has worked well overall—over the last
decade, FERC has issued permits for construction of nearly 10,000 miles of new pipeline.”18 At
the same hearing, FERC Commissioner Philip Moeller similarly stated that “for the most part,
people have been fairly satisfied with the process we have at FERC for new pipelines,” although
“it could be done quicker.”19 Nonetheless, both commissioners acknowledged that FERC’s review
of certain pipeline applications had experienced significant delays, largely due to approvals
needed from cooperating agencies after FERC’s environmental reviews under NEPA had been
completed. Both commissioners also expressed support for greater FERC authority to enforce its
certificate review deadlines. Outgoing FERC Chairman Jon Wellinghoff reportedly is not opposed
to legislation increasing FERC’s deadline authority in this way, but does not necessarily see a
need for it because, in his view, the commission has been moving quickly on pipeline certificate
reviews.20
Potential Effects of H.R. 1900
As stated above, H.R. 1900 would make three major changes to FERC’s pipeline certification
process, all schedule-related. Thus, the bill would not change the way pipeline certificate
applications are currently reviewed in terms of subject matter, funding, or inter-agency
relationships. The bill would solely seek to impose explicit time limits on the existing process.
The potential effects of the three proposed changes are discussed below.
12-Month Certification Deadline
H.R. 1900 would mandate a FERC certification process deadline of 12 months. The imposition
by Congress of explicit agency deadlines for the review of energy project permit applications is
not new. CRS has identified other statutes and legislative proposals with similar deadline
provisions for the review of permit applications: for oil and gas drilling, liquefied natural gas
terminals, electric transmission lines, and other facilities. These provisions are provided as
examples in the Appendix.
18 Honorable Cheryl LaFleur, Federal Energy Regulatory Commission, testimony before the House Committee on
Energy and Commerce, Subcommittee on Energy and Power hearing on American Energy Security and Innovation:
The Role of Regulators and Grid Operators in Meeting Natural Gas and Electric Coordination Challenges, March 19,
2013.
19 Honorable Philip Moeller, Federal Energy Regulatory Commission, testimony before the House Committee on
Energy and Commerce, Subcommittee on Energy and Power hearing on American Energy Security and Innovation:
The Role of Regulators and Grid Operators in Meeting Natural Gas and Electric Coordination Challenges, March 19,
2013.
20 Sean Sullivan, “FERC Chairman on Gas Pipeline Reviews: We Are Fast But Could Be Faster,” SNL Daily Gas
Report, April 11, 2013.
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The optimal time for any deadline that Congress might impose on FERC is unclear. Compared to
an 11.6-month benchmark implied by the GAO study, the 12-month deadline in H.R. 1900 would
be approximately the same as the average FERC certificate review time today. However, 12
months could represent a reduction in the review time that might be expected for atypically
lengthy or complex pipeline projects, perhaps routed through heavily populated or
environmentally sensitive areas. The safety or environmental reviews for such projects might
place them in the “tail” of the review time distribution reported by GAO. For example, according
to the GAO report, one pre-filed certificate review lasted 886 days.21 Assuming a 210-day pre-
filing period for this project implies a certificate review time of 676 days, or 22.5 months. For
such pipeline projects, it is unclear what FERC could do differently to shorten its review process
if the bulk of the review involves a complex NEPA environmental evaluation. More information
might be required to understand how FERC could adapt its process to meet a 12-month deadline
for such projects and to gage the possible impact of this provision.
If the 12-month deadline under H.R. 1900 were imposed upon FERC, it raises the possibility that
the commission might deny certificate applications for some projects solely on the grounds that it
lacks sufficient time for an adequate (and legally defensible) review, especially in the case of
NEPA compliance.22 This is what occurred in 2012 when the State Department denied an
application by TransCanada for a Presidential Permit to construct the Keystone XL oil pipeline,
citing insufficient time under a 60-day deadline imposed by Congress under the Temporary
Payroll Tax Cut Continuation Act of 2011 (P.L. 112-78) to obtain all the necessary information to
assess the project.23 When the 112th Congress considered delegating permit authority for the
Keystone XL to FERC and mandating permit approval within 30 days under H.R. 3548 (see
Appendix), a senior FERC official testified that such a proposal would not provide enough time
for an “adequate” public record, among other concerns.24 Another such permit review statute, the
Mineral Leasing Act, includes a provision conditioning the deadline upon satisfying review
requirements under NEPA and “other applicable law” within the given timeframe (30 U.S.C.
226(p)(2)(A)).
In July 2013 testimony before the House Committee on Energy and Commerce, Commissioner
Moeller stated that FERC could likely achieve the 12-month deadline proposed in H.R. 1900 as
long as gas pipeline certificate applications are complete when the process begins.25 Nonetheless,
a 12-month deadline imposed upon all FERC certificate reviews may lead to the rejection or
delay (due to re-application) of otherwise worthy proposals on administrative grounds if
unanticipated issues arise. It might also force developers to reconfigure, or break up, larger
projects into smaller proposals more “reviewable” within 12 months. The southern leg of the
original Keystone XL pipeline project (now called the Gulf Coast Project) was separated this way
and proceeded under its own permit process. Reconfiguration of complex pipeline projects might
lead to inefficiencies both in FERC certification and in the design or use of the infrastructure
21 GAO, p. 26. GAO did not provide details on the review time for each project in its sample.
22 Citizens can initiate a judicial challenge of a federal agency’s environmental review (after any required
administrative appeals) pursuant to the Administrative Procedure Act (5 U.S.C. §§706 et seq.).
23 U.S. Department of State, “Briefing on the Keystone XL Pipeline,” briefing transcript, January 18, 2012,
http://www.state.gov/r/pa/prs/ps/2012/01/181492.htm.
24 Jeff Wright, Director, Office of Energy Projects, Federal Energy Regulatory Commission, testimony before the
House Energy and Commerce Committee, Subcommittee on Energy and Power Hearing on the North American Energy
Access Act, January 25, 2012.
25 Honorable Philip Moeller, Federal Energy Regulatory Commission, testimony before the House Committee on
Energy and Commerce hearing on H.R. 1900, the Natural Gas Pipeline Permitting Reform Act, July 9, 2013.
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itself. Congress may consider whether a 12-month deadline could be made more flexible to
accommodate projects which may require more review time due to their size and complexity at
the discretion of FERC.
Codifying the 90-Day Agency Deadline
H.R. 1900 codifies FERC’s deadline—established through regulation—for other federal or state
agencies to make final certificate-related decisions within 90 days after FERC issues its final
environmental document. Because FERC has the statutory authority to establish such deadlines
under EPAct, the only change to the status quo of this provision would be to mandate the 90-day
time period rather than leaving the length of the time period up to FERC to determine.
Like the 12-month deadline imposed by FERC, it is difficult to determine whether 90 days is
optimal for a statutory deadline—although FERC, in this case, has an administrative record
examining the question through its rulemaking process. Note that this deadline occurs only after
FERC’s environmental review is completed, so other agencies would presumably have months
during FERC’s NEPA review to conduct reviews of approvals under their jurisdiction. Although it
affirms FERC’s current regulatory judgment as to how long the cooperating agency deadline
should be, H.R. 1900 may tie the hands of the commission if, at some future date, FERC
concludes that 90 days is no longer appropriate. In that case, FERC would have to seek new
legislation rather than changing the deadline under its existing EPAct authority through the
regulatory process. Some might view this provision as being insurance against the commission
becoming more lax in the future with respect to review deadlines. Others might view this
provision as being too prescriptive. Congress may consider whether imposing a prescriptive 90-
day deadline strikes the best balance between FERC’s deadline enforcement authority and the
commission’s ability to manage its own review process.
Default Approval of Delayed Agency Decisions
H.R. 1900 would effectively issue by default any license, permit, or approval requested from a
cooperating agency if the agency does not make its decision on the request within FERC’s 90-day
deadline. Statutory approval by default of agency decisions failing to meet a deadline appears to
have few precedents in the specific context of energy project approvals. The clearest example
CRS has been able to identify is P.L. 112-78, which would have put “in effect by operation of
law” the permit for the Keystone XL pipeline if the President failed to act on the permit prior to
the mandated 60-day deadline (§501(b)(3)). In that case, the result was denial of the permit.
However, additional statutes with default approval provisions not involving energy projects have
been cited as precedents for the provisions in H.R. 1900.26
To date, FERC has had little enforcement authority under EPAct over its 90-day deadline. H.R.
1900 might lead some cooperating agencies to increase efforts to meet the deadline. If those
agencies view the deadline as inadequate, however, some of them may deny approvals on the
basis of having insufficient time for review and the development of necessary permit conditions
as discussed above in the context of the 12-month deadline for FERC. Opponents of this
provision have cited, for example, statements from the Army Corps of Engineers, the
26 Representative Mike Pompeo, Remarks before the House Committee on Energy and Commerce, Energy and Power
Subcommittee Vote on H.R. 1582, H.R. 1900, and H.R. 83, July 10, 2013.
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Environmental Protection Agency, the Bureau of Land Management, and the Fish and Wildlife
Service expressing this concern if a 90-day deadline for their respective permit reviews were
imposed.27 Congress may consider maintaining FERC’s existing authorities to set the agency
review schedule, while providing alternative ways to strengthen FERC’s ability to enforce those
authorities at the commission’s discretion.
Resource Considerations
The principal effect of H.R. 1900 would appear to be imposing explicit (strict) time limits on the
existing process for FERC certification of new natural gas pipelines. The ability of FERC and any
other federal or state agencies it works with to expedite their parts of certificate review may be
limited by available resources. The agencies may well have the administrative capability to meet
these deadlines. That is, the review periods, public notice periods, and other regulatory
requirements associated with the certificate review schedule may all be feasible. However, a
shorter deadline under H.R. 1900 might require more resources for agency staff, contractors, and
external consultants to achieve the same level of review as a longer deadline. In considering the
ability of FERC and other agencies to meet these deadlines, the availability and allocation of
resources within the agencies may be important. This may be a concern not only for FERC, but
also for various other federal, state, and local agencies whose ability to increase funding for
regulatory review may vary considerably and may be limited due to budget constraints.
27 House Committee on Energy and Commerce Staff, Memorandum regarding Full Committee Markup of H.R. 1582,
the “Energy Consumers Relief Act of 2013;” H.R. 1900, the “Natural Gas Pipeline Permitting Reform Act;” H.R. 83, a
bill to require the Secretary of the Interior to develop an action plan to address the energy needs of the insular areas of
the United States and the Freely Associated States; H.R. 2094, the “School Access to Emergency Epinephrine Act;”
H.R. 698, the “HIV Organ Policy Equity Act;” and H.R. 2052, the “Global Investment in American Jobs Act of 2013,”
July 15, 2013, p. 5, http://democrats.energycommerce.house.gov/sites/default/files/documents/Memo-FC-Markup-HR-
1582-HR-1900-HR-83-HR-2094-HR-698-HR-2052-2013-7-15.pdf.
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Appendix. Statutory Deadlines for Energy Permits
Requirements similar to those proposed in H.R. 1900 have been imposed by Congress on other
agencies to approve or deny energy projects. A number of statutes or bills over the last 10 years
have included explicit deadlines (i.e., a specific number of days) for various types of federal
energy permits—including drilling permits, liquefied natural gas (LNG) terminals, a nuclear
waste repository, and electric transmission lines. They are summarized below. Note that, due to
the limitations of such a legislative search, there may be additional statutes we have not
identified.28
• The Mineral Leasing Act as amended (30 U.S.C. 226(p)) requires the Secretary
of the Interior to approve or disapprove of drilling permit applications submitted
by federal leaseholders within 30 days of submission unless they fail to meet
certain required criteria.
• The Maritime Administration (MARAD) has a 330-day time limit for granting or
denying a deepwater port license (33 U.S.C. §1504), including a 45-day deadline
after the last public hearing for specific agency reviews (33 U.S.C. §1504(e)(2)).
Notably, this provision applies to offshore LNG terminal applications.
• The Outer Continental Shelf Lands Act as amended (43 U.S.C. 1340(c)) requires
the Secretary of the Interior to approve or disapprove of oil and gas exploration
plans (drilling permits) submitted by federal leaseholders within 30 days of
submission unless the plans fail to meet certain required criteria.
• The Nuclear Waste Policy Act of 1982 (P.L. 97-425) requires the Nuclear
Regulatory Commission to issue a final decision approving or disapproving a
nuclear waste repository project proposal “not later than the expiration of 3 years
after the date of the submission of such application” (§405(b)(2)).
• The Energy Policy Act of 2005 (P.L. 109-58) gives FERC authority to permit an
electric transmission siting application if “a State commission or other entity that
has authority to approve the siting of the facilities has—(i) withheld approval for
more than 1 year….” (§1221).
• The Energy Policy Act of 2005 (P.L. 109-58) requires the Secretary of Energy to
approve or disapprove a tribal energy resource agreement from an Indian tribe
not later than 270 days after receiving an initial agreement or not later than 60
days after the Secretary receiving a revised agreement (§2604(e)).
• The Temporary Payroll Tax Cut Continuation Act of 2011 (P.L. 112-78) required
the Secretary of State to issue a permit for the Keystone XL pipeline within 60
days, unless the President determined the project not to be in the national interest
(§501(a)).
In addition to these statutes, CRS identified a few recent unenacted legislative proposals that
would have imposed statutory deadlines on energy project permit decisions. Examples are listed
below.
28 Information provided was found through keyword searches of legislative databases performed by L.J. Cunningham
in the CRS Knowledge Services Group.
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• The Energy Policy Act of 2003 (H.R. 1644, 108th Congress) would have required
the Federal Energy Regulatory Commission to approve or deny any permit
application for an Alaska natural gas pipeline project “not more than 60 days
after the issuance of the final environmental impact statement” (§2004(c)).
• The American Clean Energy and Security Act of 2009 (H.R. 2454, 111th
Congress) would have required the Federal Energy Regulatory Commission or
the Department of the Interior to complete review of “all permit decisions and
related environmental reviews under all applicable Federal laws” for electric
transmission project applications in the Western Interconnection within one year
or, if provisions in another federal law required more time, as soon as practicable
thereafter (§216B).
• The Energy Exploration and Production to Achieve National Demand Act (H.R.
4301, 112th Congress) would have required the Administrator of the
Environmental Protection Agency and the state or governing body of an Indian
tribe to approve or disapprove a consolidated permit application for the
construction of a new oil refinery within 365 days, or, if all parties agreed, within
an additional 90 days (§501(b)(4)(A)). For the expansion of an existing refinery,
the respective deadlines were 120 and 30 days (§501(b)(4)(B)).
• The North American Energy Access Act (H.R. 3548, 112th Congress) would have
transferred the permitting authority over the Keystone XL pipeline project from
the State Department to the Federal Energy Regulatory Commission, requiring
the commission to issue a permit for the project within 30 days of enactment. The
bill would have deemed a permit to have been issued if the commission did not
act upon a permit application within 30 days after receipt (§3(a)).
Author Contact Information
Paul W. Parfomak
Specialist in Energy and Infrastructure Policy
pparfomak@crs.loc.gov, 7-0030
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