Commissioner Richard Glick Statement
May 21, 2020

Docket No. CP17-178-000
Order: C-7 PDF

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Dissent in Part Regarding Alaska Gasline Development Corporation (Alaska LNG Project)

I dissent from today’s order because it violates both the Natural Gas Act 1 (NGA) and the National Environmental Policy Act 2 (NEPA).  Rather than wrestling with the Alaska LNG Project’s 3 significant adverse impacts, today’s order makes clear that the Commission will not allow these impacts to get in the way of its outcome-oriented desire to approve the Project.

As an initial matter, the Commission once again refuses to consider the consequences its actions have for climate change.  Although neither the NGA nor NEPA permit the Commission to assume away the impact that constructing and operating the Project will have on climate change, that is precisely what the Commission is doing here.  In today’s order authorizing the Project, pursuant to section 3 of the NGA, the Commission continues to treat climate change differently than all other environmental impacts.  The Commission steadfastly refuses to assess whether the impact of the Project’s greenhouse gas (GHG) emissions on climate change is significant, even though it quantifies the direct GHG emissions caused by the Project’s construction and operation. 4   That refusal to assess the significance of the Project’s contribution to the harm caused by climate change is what allows the Commission to perfunctorily conclude that the environmental impacts associated with the Project are “acceptable” 5 and, as a result, conclude that the Project satisfies the NGA’s public interest standard. 6   Claiming that a project’s environmental impacts are acceptable while at the same time refusing to assess the significance of the project’s impact on the most important environmental issue of our time is not reasoned decisionmaking.

Moreover, the Commission’s public interest analysis does not adequately wrestle with the Project’s adverse environmental impacts.  The Commission finds that the Project will have a significant and adverse effect on several endangered species, the Central Artic Herd of caribou, permafrost, forest, and air quality for certain nationally designated areas. 7   Although the Commission discloses these adverse impacts, at no point does it explain how it considered them in making its public interest determination or why it finds that the Project satisfies the public interest standard notwithstanding those substantial impacts.  Simply asserting that the Project is not inconsistent with the public interest after dismissively classifying all significant adverse impacts as “acceptable” without explanation is not reasoned decisionmaking. 

What is more, the Commission plainly lacks the record needed to make the necessary public interest findings.  In particular, the Commission has not yet received a final determination from the resource agencies regarding the Project’s considerable adverse effects on endangered species.  The fact that the Commission believes that it can make a public interest finding without hearing from the experts on endangered species tells you everything you need to know about how seriously it takes those impacts, no matter what the Commission says to the contrary.  Actions, after all, speak louder than words.   

Finally, this Project is unprecedented in both scale and scope, stretching 800 miles across unique and fragile ecosystem of Northern Alaska.  Many of the challenges presented by this project are first-of-their-kind and demand in-depth and rigorous examination. 8   Certain environmental impacts in particular are ones which the Commission, and even industry, has little experience, giving us precious little to go on in assessing the magnitude of the impacts and designing appropriate mitigation. 9   And yet, the Commission is rushing to issue this certificate, while many unknowns still linger. 

The Commission’s Public Interest Determinations Are Not the Product of Reasoned Decisionmaking

The NGA’s regulation of LNG import and export facilities “implicate[s] a tangled web of regulatory processes” split between the U.S. Department of Energy (DOE) and the Commission. 10   The NGA establishes a general presumption favoring the import and export of LNG unless there is an affirmative finding that the import or export “will not be consistent with the public interest.” 11   Section 3 of the NGA provides for two independent public interest determinations:  One regarding the import or export of LNG itself and one regarding the facilities used for that import or export. 

DOE determines whether the import or export of LNG is consistent with the public interest, with transactions among free trade countries legislatively deemed to be “consistent with the public interest.” 12   The Commission evaluates whether “an application for the siting, construction, expansion, or operation of an LNG terminal” is itself consistent with the public interest. 13   Pursuant to that authority, the Commission must approve a proposed LNG facility unless the record shows that the facility would be inconsistent with the public interest. 14   Today’s order fails to satisfy that standard in multiple respects.

The Commission’s Public Interest Determination Does Not Adequately Consider Climate Change

In making its public interest determination, the Commission examines a proposed facility’s impact on the environment and public safety.  A facility’s impact on climate change is one of the environmental impacts that must be part of a public interest determination under the NGA. 15   Nevertheless, the Commission maintains that it need not consider and ultimately determine whether the Project’s contribution to climate change is significant because it lacks a means to do so—or at least so it claims. 16   However, the most troubling part of the Commission’s rationale is what comes next.  Based on this alleged inability to assess the significance of the Project’s impact on climate change, the Commission still concludes that all of the Project’s environmental impacts would be “acceptable. 17  Think about that.  The Commission is simultaneously stating that it cannot assess the significance of the Project’s impact on climate change 18 while concluding that all environmental impacts associated with the Project are acceptable and not inconsistent with the public interest. 19   That is unreasoned and an abdication of our responsibility to give climate change the “hard look” that the law demands. 20

It also means that the Project’s impact on climate change does not play a meaningful role in the Commission’s public interest determination, no matter how often the Commission assures us that it does.  Using the approach in today’s order, the Commission will always conclude that a project will not have a significant environmental impact irrespective of that project’s actual GHG emissions or those emissions’ impact on climate change.  If the Commission’s conclusion will not change no matter how many GHG emissions a project causes, those emissions cannot, as a logical matter, play a meaningful role in the Commission’s public interest determination.  A public interest determination that systematically excludes the most important environmental consideration of our time is contrary to law, arbitrary and capricious, and not the product of reasoned decisionmaking.

The failure to meaningfully consider the Project’s GHG emissions is all-the-more indefensible given the volume of GHG emissions at issue in this proceeding.  Upon completion, the Project will directly release 16.3 million tons of GHG emissions per year with maximum methane flare, in addition to the 2.2 million tons of GHG emissions during the eight years of construction. 21  To grasp the magnitude of these emissions, 16.3 million metric tons amounts to an annual increase in Alaska’s total GHG emissions of nearly 50 percent. 22   Put another way, these emissions are equivalent to the emissions of 3.5 million vehicles, four times the number of passenger vehicles in the entire state of Alaska. 23   The Order recognizes that climate change is “driven by accumulation of GHGs in the atmosphere through combustion of fossil fuels (coal, petroleum, and natural gas), combined with agriculture, clearing of forests, and other natural sources” 24 and that the “GHG emissions from the construction and operation of the [P]roject would increase the atmospheric concentration of GHGs in combination with past and future emissions from all other sources and contribute incrementally to future climate change impacts.” 25   In light of this undisputed relationship between anthropogenic GHG emissions and climate change, the Commission must carefully consider the Project’s contribution to climate change when determining whether the Project is consistent with the public interest—a task that it entirely fails to accomplish in today’s order.  The Commission’s fervent insistence that it took such a ‘hard look’ at climate change is no substitute for actually having done so.

The Commission’s Consideration of the Project’s Other Adverse Impacts Is Also Arbitrary and Capricious

In addition, the Commission concludes that the Project will result in several significant, and often permanent, adverse impacts on the environment.  The Project is expected to adversely affect six endangered species including polar bears, seals and whales.  In addition, even with mitigation measures, the Project is expected to have a significant adverse impact on the Central Artic Herd of caribou, permafrost, forest, and air quality in areas such as Denali National Park. 26   The Commission discloses these adverse impacts in the EIS and gives them a mention in today’s order. 27  But the Commission makes no effort to wrestle with those impacts or explain how they factor meaningfully into the Commission’s public interest analysis.  Simply deeming those adverse impacts to be “acceptable” without any explanation of how that conclusory finding supports the Commission’s public interest determination is a far cry from reasoned decisionmaking.

The Sierra Club makes this very point. 28  The Commission responds by reciting its burden of proof, namely that LNG export facilities must be approved unless they are shown to be inconsistent with the public interest, and then pointing to the economic benefits that may result from the Project. 29  It then summarily concludes that the Project’s significant adverse environmental impacts “do not amount to an affirmative showing of inconsistency with the public interest” 30 and that all environmental impacts are “acceptable considering the public benefits.” 31   But it never explains how it makes that determination or why those serious environmental consequences are acceptable given the Project’s benefits.  Simply labeling them “acceptable” does not make it so or comply with our obligation to provide a rationale reached by ‘reasoned decisionmaking,’ including an examination of the relevant data and “‘a reasoned explanation supported by a stated connection between the facts found and the choice made.’” 32   Indeed, the Commission’s willingness to brush off environmental impacts in its public interest analysis would seem to suggest that the Commission’s environmental analysis is more checking the box than part of a serious effort to balance the Project’s benefits and harms when assessing consistency with the public interest.  

That is particularly so in this order, where the Commission makes its public interest finding without even bothering to wait for determination from the relevant resource agencies about the Project’s impact on six endangered species—the polar bear, humpback whale, Cook Inlet beluga whale, bearded seal, ringed seal, and spectacled eider. 33   I would have thought that those agencies’ final conclusions about the Project’s impact on these endangered would be relevant, even essential, to our public interest determination.  The fact that the Commission will not authorize any construction on the Project until it receives those final conclusions is not an excuse for making a public interest determination without them. 34  

Finally, the Commission’s public interest analysis makes no effort to recognize, much less wrestle with, the considerable uncertainty inherent in developing such a complex project in a hostile and fragile ecosystem.  The “LNG export terminal” at issue, includes a gas processing facility located more than 800 miles away (a distance roughly the size of Texas at its widest point) and a connecting pipeline that runs through a vast swathe of the Arctic. 35   The Commission has little familiarity with these circumstances, having only once before permitted a jurisdictional pipeline in Alaska 36 and having “never exerted NGA section 3 jurisdiction over a project of this size.” 37   Under such circumstances, one might be excused for assuming that the Commission would address that uncertainty in its public interest determination and adopt a conservative approach to managing the Project’s impacts—including rigorous mitigation measures—that reflect our limited experience. 

Instead, the Commission’s public interest finding makes no mention of the uncertainty associated with the Project or the yawning gaps in our understanding of how it will affect critical resources.  Consider the caribou.  The Commission finds that running an 800-mile pipeline through the middle of the range used by the Central Arctic Herd of caribou will have a significant adverse effect on both the animals and the communities that rely on them for subsistence. 38   If anything, that seems like an understatement.   Without complete information at the outset, the Commission requires the Project’s developer to study those effects after the Project has gone into service, with the opportunity to impose to-be developed mitigation measures at some point in the future in lieu of imposing concrete mitigation measures at this time. 39   I recognize that not all the impacts of such an unprecedented project can be understood and accounted for a decade before it is built and support the effort to collect more information.  Still, I would have thought that reasoned decisionmaking requires the Commission to account for that uncertainty in its public interest determination and, at the very least, explain why the impact is “acceptable” and does not raise serious questions about whether the Project satisfies the statutory standard. 

The Commission Fails to Satisfy Its Obligations under NEPA

The Commission’s NEPA analysis of the Project’s GHG emissions is similarly flawed.  In order to evaluate the environmental consequences of the Project under NEPA, the Commission must consider the harm caused by its GHG emissions and “evaluate the ‘incremental impact’ that those emissions will have on climate change or the environment more generally.” 40  As noted, the operation of the Project will emit more than 16 million tons of GHG emissions per year. 41  Although quantifying the Project’s GHG emissions is a necessary step toward meeting the Commission’s NEPA obligations, listing the volume of emissions alone is insufficient. 42  

As an initial matter, identifying the consequences that those emissions will have for climate change is essential if NEPA is to play the disclosure and good government roles for which it was designed.  The Supreme Court has explained that NEPA’s purpose is to “ensure[] that the agency, in reaching its decision, will have available, and will carefully consider, detailed information concerning significant environmental impacts” and to “guarantee[] that the relevant information will be made available to the larger audience that may also play a role in both the decisionmaking process and the implementation of that decision.” 43   It is hard to see how hiding the ball by refusing to assess the significance of the Project’s climate impacts is consistent with either of those purposes. 

In addition, under NEPA, a finding of significance informs the Commission’s inquiry into potential ways of mitigating environmental impacts. 44   An environmental review document must “contain a detailed discussion of possible mitigation measures” to address adverse environmental impacts. 45   “Without such a discussion, neither the agency nor other interested groups and individuals can properly evaluate the severity of the adverse effects” of a project, meaning that an examination of possible mitigation measures is necessary to ensure that the agency has taken a “hard look” at the environmental consequences of the action at issue. 46

The Commission responds that it need not determine whether the Project’s contribution to climate change is significant because “[t]here is no universally accepted methodology” for assessing the harms caused by the Project’s contribution to climate change. 47   But that does not excuse the Commission’s failure to evaluate these emissions.  As an initial matter, the lack of a single consensus methodology does not prevent the Commission from adopting a methodology, even if it is not universally accepted.  The Commission could, for example, select one methodology to inform its reasoning while also disclosing its potential limitations or the Commission could employ multiple methodologies to identify a range of potential impacts on climate change.  In refusing to assess a project’s climate impacts without a perfect model for doing so, the Commission sets a standard for its climate analysis that is higher than it requires for any other environmental impact. 

In any case, the Commission also can use its expertise to consider all factors and determine, quantitatively or qualitatively, whether the Project’s GHG emissions have a significant impact on climate change. That is precisely what the Commission does in other aspects of its environmental review.  Consider, for example, the Commission’s findings that the Project will not have a significant effect on issues such as “scrub and herbaceous plant communities,” 48  “subsistence users” 49  and “forest communities.” 50   Notwithstanding the lack of any “universally-accepted methodology” to assess these impacts, the Commission uses its judgment to conduct a qualitative review, and assess the significance of the Project’s effect on those considerations. 51  The Commission’s refusal to, at the very least, exercise similar qualitative judgment to assess the significance of GHG emissions here is arbitrary and capricious.

And even if the Commission were to determine that the Project’s GHG emissions are significant, that is not the end of the analysis.  Instead, as noted above, the Commission could blunt those impacts through mitigation—as the Commission often does with regard to other environmental impacts.  The Supreme Court has held that an environmental review must “contain a detailed discussion of possible mitigation measures” to address adverse environmental impacts. 52   As noted above, “[w]ithout such a discussion, neither the agency nor other interested groups and individuals can properly evaluate the severity of the adverse effects.” 53  

Consistent with this obligation, the EIS discusses mitigation measures to ensure that the Project’s adverse environmental impacts (other than its GHG emissions) are reduced to less-than-significant levels. 54   And throughout today’s order, the Commission uses its broad conditioning authority under section 3 of the NGA 55 to implement these mitigation measures, which support its public interest finding. 56  Despite this use of our conditioning authority to mitigate adverse impacts, the Project’s climate impacts continue to be treated differently, as the Commission refuses to identify any potential climate mitigation measures or discuss how such measures might affect the magnitude of the Project’s impact on climate change.

Finally, the Commission’s refusal to seriously consider the significance of the impact of the Project’s GHG emissions is even more mystifying because NEPA “does not dictate particular decisional outcomes.” 57   NEPA “‘merely prohibits uninformed—rather than unwise—agency action.’” 58   The Commission could find that a project contributes significantly to climate change, but that it is nevertheless in the public interest because its benefits outweigh its adverse impacts, including on climate change.  In other words, taking the matter seriously—and rigorously examining a project’s impacts on climate change—does not necessarily prevent any of my colleagues from ultimately concluding that a project satisfies the relevant public interest standard.  

For these reasons, I respectfully dissent.






                                               

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