December 2021 Vol. 76 No. 12

Washington Watch

FERC Punts on GHG ‘Significance’ Again

By Stephen Barlas, Washington D.C. Editor

The Federal Energy Regulatory Commission (FERC) continues to hesitate in determining whether greenhouse gas (GHG) emissions from new pipeline projects are a “significant” contribution to climate change. 

The latest example is an FERC draft environmental impact statement (EIS) on Spire’s Clear Creek pipeline/compression project in Wyoming. In the draft EIS published at the end of October, the FERC staff stated: “We are unable to determine significance regarding the project’s impacts on climate change. However, we acknowledge the project would increase the atmospheric concentration of GHGs, in combination with past and future emissions from all other sources, and would contribute to climate change.” 

The U.S. Court of Appeals for the District of Columbia last August slapped FERC’s wrist for failing to do a more thorough job of at least trying to estimate the “significance” of a project’s GHG emissions on climate change. That decision, called Vecinos para el Bienestar de la Comunidad Costera v. Federal Energy Regulatory Commission, had to do with Texas LNG and pipeline projects. 

The Appeals Court cited provisions in the National Environmental Policy Act (NEPA), which in some readings of that law requires a “significance” determination. The Biden White House Council on Environmental Quality announced in October it was revising NEPA policies and any final pronouncement is apt to force federal agencies to compute GHG emissions  
using a tool called the “social cost of carbon (SCC)” or some similar method. 

In Vecinos, DC Appeals Court suggested FERC might be interested in using the SCC tool, which estimates the monetized damages associated with incremental increases in greenhouse gas emissions based on complex models. This model describes how greenhouse gas emissions affect global temperatures, sea level rise and other biophysical processes; how these changes affect society through agricultural, health and other impacts; and monetary estimates of the market and nonmarket values of these impacts. 

The Bureau of Land Management became the first federal agency to mandate use of the SCC tool on Nov. 1, announcing its use when issuing draft environmental assessments regarding proposed oil and gas lease sales to be held in 2022. 

The Republican-majority FERC has not been sympathetic to the SCC tool. That may change when Willie Phillips, Jr., President Biden’s nominee for the fifth seat at FERC, is confirmed by the Senate. The Senate Energy & Commerce Committee held a hearing on Phillips’ nomination on Oct. 19. Phillips will be the third Democratic appointee on the commission, giving Chairman Richard Glick a deciding vote should he determine a more thorough climate change analysis is due, either via the SCC tool or some other method that allows FERC to do what it didn’t do in earlier cases. 

Phillips’ ascension to FERC could also affect the commission’s vote on the Spire Clear Creek compression project, as well as another Spire project hanging in the balance at FERC. The STL Pipeline is also waiting for FERC to determine if it can continue to operate. The same federal appeals court in Washington that issued Vecinos issued a second decision in June setting aside FERC’s earlier approval in 2018 of Spire’s 65-mile gas pipeline from Illinois into Missouri. The court said regulators “failed to consider evidence of self-dealing” by Spire in building the pipeline. 

Jason Merrill, a spokesman for Spire, says the Spire STL Pipeline has a short-term certificate keeping the pipeline in operation through Dec. 13, 2021. “Our application for a temporary emergency certificate for the rest of winter heating season is still under review,” he explained. 

Phillips could have a say on STL and on Clear Creek, where GHG emissions will be a sticking point. The staff draft EIS says construction emissions from the project could potentially increase CO2e emissions, based on the national 2019 levels, by 0.00014 percent. In subsequent years, the potential increase is 0.0014 percent. 

The staff explained, “Additionally, we are unaware of an established threshold for determining the project’s significance when compared to established GHG reduction targets at the state or federal level.” 

Spire’s Clear Creek Expansion Project in Uinta County, Wyo., would include four compressor units at the Clear Creek plant, approximately 7 miles of 20-inch-diameter pipeline, approximately 3.6 miles of 24-inch-diameter pipeline  
and other facilities. 


Biden Methane Proposal Ups Pipeline Responsibility 

The Biden administration's proposal to limit methane emissions from pipeline transmission compressors and pneumatic controllers goes beyond what the Obama administration had put in place in 2017. The Trump administration dropped those Obama methane rules only to have the recent, Democratically controlled Congress pass a resolution of disapproval of the Trump rule, forcing the Environmental Protection Agency (EPA) to repropose the Obama rules with some additional controls. 

In addition, the EPA says it is considering even more aggressive regulation in 2022 for certain oil and gas operations such as, in the case of natural gas transmission lines, pigging. 

The major expansion of the Obama methane rules is in the Biden administration’s application of controls to the emissions from natural gas-driven “intermittent vent” pneumatic controllers. They were left untouched by the Obama administration because, when operated and maintained properly, methane and VOC emissions from intermittent controllers are substantially lower than emissions from other types of natural gas-driven controllers. 

However, the EPA is now aware that these intermittent controllers often malfunction and vent during idle periods. Emissions factors considering this fact are around four times higher than the factors for low-bleed controllers. The EPA contends the emissions from natural gas-powered pneumatic controllers represent a significant portion of the total emissions from the oil and natural gas Industry. The agency is proposing a requirement that all controllers (continuous bleed and intermittent vent) in the production and natural gas transmission and storage segments must have a methane and VOC emission rate of zero. 

The wrinkle here regards existing versus new controllers. In the former case, states will have the opportunity to adopt controls short of zero emissions if they are able to convince the EPA they can achieve the same methane reductions via another method. There would be no such flexibility for new controllers. 

In another instance of the Biden EPA tightening the Obama rules, the exemption from methane emission standards Obama had in the rules goes out the window. That exemption was in cases where the use of a pneumatic controller affected facility, with a bleed rate greater than the applicable standard, was required based on functional needs, including but not limited to response time, safety and positive actuation. The EPA is not maintaining that exemption except in very limited circumstances. 

All new and existing compressor stations would monitor and repair leaks at least once every three months. Surveys must include inspections of equipment that is most prone to large leaks and malfunctions, including hatches on storage tanks and flares. 

“INGAA supports federal new and existing source methane emissions regulations that are safe, effective and protect energy reliability,” said Amy Andryszak, president and CEO of the Interstate Natural Gas Association of America (INGAA). “To be successful, methane regulations should allow our engineers and technicians appropriate flexibility to further reduce emissions from natural gas operations, using a range of available technologies and tools, while avoiding activities that may impair energy reliability. 

“We are reviewing the details of the EPA’s proposals against these principles and plan to engage with the agency on any of the proposed requirements that will impact the natural gas transmission industry’s ability to efficiently deliver reliable energy while minimizing emissions.” 

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