FERC Chairman Richard Glick’s legacy should clearly identify for future commissioners the analyses necessary to determine what proposed fossil fuel projects will actually serve the public interest and warrant FERC approval. He can and should do this by finalizing the much-needed Updated Certificate Policy Statement. Under his leadership, FERC was heading in the right direction, mapping out how it would remedy its broken, 20th-century Certificate Policy Statement through the publication of its “Updated Certificate Policy Statement,” literally years in the making. Then—after a spectacularly theatrical Congressional oversight hearing— FERC lost its will or way and demoted the finalized Updated Policy back to draft status.
By finalizing the Updated Policy Statement as one of his last acts as FERC Chairman, Commissioner Glick would cement essential inquiries into a proposed project. It would also ensure that moving forward FERC fulfills its Congressionally-mandated role of protecting consumers, only approving projects that are truly in the public interest, and stewarding safe, reliable, and robust energy markets. This would also give baseless arguments railing against FERC for formalizing this necessary update to its analytical framework exactly the airspace they deserve: none.
The political pushback against the Updated Statement is a lot of meritless noise, designed to prevent FERC from asking applicants too many questions that they’d rather not answer, and—relatedly—from gathering independent data to support accurate market-need analyses. The fact is that FERC needs to ask these questions to meet its statutory obligations under the Natural Gas Act, including only approving projects that are in the public convenience and necessity, i.e., in the true public interest.
So what’s the end game to applying political pressure on FERC not to finalize its Updated Policy Statement? Arguably it’s ensuring that FERC continues to rubber-stamp gas projects that neither serve the public interest nor protect consumers’ wallets, all without having to take a hard look under the metaphorical hood. Such arguments against finalizing the Updated Statement also make no sense because the Natural Gas Act empowers FERC to conduct all of this much-needed analyses, including on market need, despite its institutional reluctance to draw on that authority. Therefore, the chief concern appears to be that by finalizing the Updated Statement, FERC is signaling that it might do just that.
And any fear that FERC may have on potential legal repercussions to finalizing the Updated Statement are unfounded. In fact, there is significant legal risk to continuing in the same manner that the courts have already called into question. Court orders overturning or kicking back FERC orders are almost always because FERC failed in its investigatory and analytical duties. i.e., the D.C. Circuit will not overturn a FERC project approval or denial because FERC took too hard a look at the questions it’s statutorily mandated to consider. Thus any challenges to the Updated Certificate Policy Statement, like the ones lobbed into the years-long Certificate Policy saga, won’t stick.
Additionally, those seeking a legal dispute against FERC’s Updated Certificate Policy Statement cannot be aggrieved by such a rulemaking. Therefore, the D.C. Circuit is unlikely to find any such challengers to have sufficient standing to bring suit. Moreover, the Updated Statement merely indicates that FERC won’t waive its statutory obligations, rules, and regulations regarding applications and their contents, so any facial challenge to it would fall flat substantively as well. As for any potential challenge to the Policy’s application to a particular adjudicatory proceeding—like a Section 3 LNG or Section 7 gas pipeline application—alleging that FERC looked too carefully at market need or a project’s impacts – that argument is dead on arrival as well, for the reasons outlined above.
The political window for this essential update to an archaic policy framework is closing fast. Commissioner Glick ought to flex some muscle on his way out the door—to help ensure that only projects with true public use are built, and signal to industry that FERC is serious about its statutory obligations and implementing the law.