Court rejects challenges to FERC approval of Alaska Gasline plan

A federal appeals court has rejected the objections of environmental advocacy groups to the approval given by the Federal Energy Regulatory Commission (FERC) for a proposed natural gas pipeline and export project in Alaska.

The US Court of Appeals for the District of Columbia Circuit ruled May 16 that FERC had given due consideration to potential environmental impacts and alternatives for the Alaska Gasline Development Corp. plan, long on the drawing boards as a project to commercialize Alaska North Slope gas.

The project would include an 800-mile, 3.5 bcfd pipeline from the North Slope to Nikiski, on the south coast of Alaska, where a 20 million tonnes/year liquefaction plant would be built to ship LNG out of Cook Inlet to world markets, most obviously to East Asia.

The Center for Biological Diversity and the Sierra Club raised a variety of substantive and procedural objections under the National Environmental Policy Act (NEPA) and the Natural Gas Act, much of their argument boiling down to an insistence on more analysis.

But a three-judge panel of the appellate court said FERC had properly fulfilled its duties under both laws, backing up its project approval with a 1,500-page environmental impact statement that went into much detail on such elements as impacts on wetlands, marine mammals, fish, drinking water, rivers, soils, permafrost, vegetation, and Alaskan socioeconomics.

FERC approved the project in 2020. In April, the US Department of Energy (DOE) approved exports from the project to non-free trade agreement countries.

Emission calculations wanted

The environmental groups objected, among other things, to FERC’s failure to calculate greenhouse gas emissions that would occur when customers burned the natural gas.

The court responded that DOE, as the agency with authority over exports from the project, had the proper jurisdiction for consideration of export emissions.

Domestic customers also are a possibility for the project, with the idea that the pipeline could be tapped to serve Alaska communities along its route. But the court noted that there are no definite plans for such sales, no local pipeline extensions planned, no state approvals for such local plans, and no customers lined up. FERC cannot offer meaningful emission calculations without such plans in place, the court said.

The environmental groups also wanted a calculation of the “social cost of carbon,” an idea that often comes up in the context of climate change, though FERC said it would not be realistic, given the lack of scientific consensus over how to make such calculations.

The court agreed with the agency, saying, “The absence of an adequate methodology, combined with a lack of either state or federal emission benchmarks, left FERC unable to assess the project’s causal effect (if any) on global climate change.”

The groups also argued that FERC’s analysis of alternative project plans fell short because it did not compare all elements of each alternative.

The court concluded that all elements were beside the point if one or more elements disqualified the alternatives. “When an alternative has greater projected environmental impacts than the action under review, no statute or regulation prevents the commission from rejecting the alternative on that ground,” the court said.

Public interest

The Center for Biological Diversity and the Sierra Club argued that FERC’s decision was arbitrary and failed to satisfy the Natural Gas Act, but the court said the decision “easily comports with the NGA.” The court pointed to the way the act, in delegating authority to FERC, says FERC “shall issue” authorization for LNG facilities “unless” it determines doing so “will not be consistent with the public interest.”

“The commission expressly concluded the project was in the public interest because it would have substantial economic and commercial benefits, and these benefits were not outweighed by the projected environmental impacts,” the court said.

The court said the environmental groups’ NEPA objections “fare no better when framed as NGA challenges. FERC’s public interest determination was reasonable and lawful.”