Saturday, November 29, 2008
Times/Review Newspapers, Mattituck, N.Y.
(Nov. 26) Two New York agencies are asking a federal court to review the Federal Energy Regulatory Commission's approval of Broadwater Energy's application to site, build and operate a liquefied natural gas terminal in L.I. Sound.
In a petition filed earlier this month with the U.S. Court of Appeals for the Second Circuit in New York City, the New York departments of state and environmental conservation claim that FERC violated the federal Coastal Zone Management Act, the Clean Water Act and the Natural Gas Act when it issued permits on March 20 to Broadwater Energy LLC and Broadwater Pipeline LLC to construct and operate the floating LNG terminal and a 22-mile subsea pipeline in New York waters of L.I. Sound, about nine miles north of Wading River.
Though the petition does not detail the state's arguments regarding the alleged violations of federal law by FERC, which will be contained in the state's subsequent brief and memorandum of law, at issue is FERC's practice of granting permit approvals prior to completion of review and approval by the appropriate state agencies under the federal Coastal Zone Management and Clean Water acts.
FERC has issued such permits expressly conditioned on approval by the required state agencies pursuant to the CZMA and Clean Water Act. At least two states, Washington and Delaware, already are challenging FERC's practice of issuing such conditional permits before state review is completed and approvals or certifications are issued by state agencies. Those actions are now pending before the U.S. Court of Appeals in Washington, D.C.
The question, according to a brief filed by Washington state in its lawsuit against FERC, is "whether the Federal Energy Regulatory Commission can, through policy and practice, rewrite the terms of federal statutes" that require prior state approval.
The federal law was specifically crafted to allow states that are hosts to these projects and must live with their impacts a "protected" period of time to evaluate them, Joan Marchioro, an attorney in Washington State's attorney general's office, told The Suffolk Times in September. FERC's policy of issuing "conditional" licenses turns the statute on its head, she said, and "once FERC says to an applicant, 'You're good to go,' it puts all the pressure on the state."
A call seeking comment from the New York attorney general's office was not returned by presstime.
"It's a violation of the [federal] Clean Water Act and Coastal Zone Management Act for FERC to license the project prior to hearing from the state regarding CZMA and the Clean Water Act. Those must be decided by the state first," Peter Bergen, the attorney representing the towns of Riverhead and Southold on the Broadwater matter, said in September, when rehearing requests were denied by FERC.
"It violates the plain language of the statutes," he said. Mr. Bergen said section 307 of the Coastal Zone Management Act and section 401 of the Clean Water Act, both federal statutes, plainly require the host state to approve the Broadwater plan before FERC may issue its permits. "We raised that issue in our rehearing request and FERC just blew us off," Mr. Bergen said.
Broadwater Energy LLC, a joint venture of Shell Oil and TransCanada Pipelines, proposes to build a 1,200-foot-long floating LNG terminal in the Sound. The terminal, a storage and "regasification" facility, would be capable of supplying the New York metropolitan area with one billion cubic yards of natural gas each day. It would take delivery of supercooled liquefied natural gas from two to three oceangoing tankers a week, and heat the liquid to return it to a gaseous state. It would then supply the distribution network with gas via 22-mile subsea pipeline that would connect to the existing Iroquois pipeline that traverses the Sound and connects to a land-based distribution pipeline in western Suffolk County.
The Broadwater proposal drew fire from environmental and civic groups on both sides of the Sound, and was quickly opposed by the towns of Riverhead, Brookhaven, Southold, East Hampton and Huntington, as well as by Suffolk County and the Connecticut attorney general.
FERC approved Broadwater's permit applications in March over the broad opposition of local governments and citizen groups. But under federal law, the project must be ruled consistent with the state's coastal policy and the clean water act by the state DOS and DEC, respectively. The new legal challenge brought by the state addresses FERC's policy of approving permits before the state's consistency rulings are issued. Subsequent to FERC's permit approval, the New York State Department in fact ruled Broadwater's plan inconsistent with the state's coastal management policy. Broadwater has asked the U.S. commerce secretary to override the state's consistency determination in the interest of national security. A decision on that pending petition is not expected until 2009.
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