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Muoio, Gusciora & Benson Measure Seeking Tougher Federal Approval Process on Natural Gas Pipelines Clears Assembly

(TRENTON) – The Assembly on Thursday approved legislation sponsored by Assembly Democrats Elizabeth Maher Muoio, Reed Gusciora and Daniel Benson urging the federal government to toughen its policies on the approval of interstate natural gas pipelines in order to fully weigh the environmental costs, as well as the impact on private property owners and state and local government policies.

The measure (ACR-53) urges the President and Congress to change the laws concerning approvals of interstate natural gas pipelines so they better implement current energy policy considerations, require consideration of the cumulative impacts of the overall development of natural gas transmission infrastructure on a region, and require deference to certain competing state policy determinations.

“Federal law currently stipulates that in order for a proposed natural gas pipeline project to be approved, it must find that the project is in the public interest and that the overall benefits of the project outweigh the adverse impacts,” said Muoio. “Unfortunately, the federal approval process has become a rubber stamp approval for the natural gas industry. Given the enormously adverse environmental impact these proposed pipelines will have on countless communities in New Jersey, it’s crucial that the federal government enact more stringent policies for approval.”

The sponsors noted that the regulatory regimes governing oil transportation and gas transportation differ radically from each other. While proposed interstate natural gas pipelines are reviewed and permitted at the federal level by the Federal Energy Regulatory Commission (FERC), proposed interstate oil pipelines are reviewed and permitted almost exclusively at the state level. The differences in regulation of the transportation of oil and gas arose in part because of the physical properties of each resource but also because each regulatory system developed in response to different political and economic times and remain in place today largely as a vestige of those early days.

Congress enacted the Natural Gas Act of 1938 to place the federal government in control of the siting of interstate natural gas pipelines to level the playing field between competing energy producing industries, and later amended the act after World War II to put natural gas companies on the same footing as other power industries by providing natural gas pipeline companies with eminent domain authority.

“In New Jersey, property owners and local governments who are affected by these proposed natural gas pipelines have rightfully raised serious questions about the current process for approval,” said Gusciora (D-Mercer/Hunterdon). “I couldn’t agree more with their assertions that the current approval process does not adequately protect the State of New Jersey’s natural resources or even adequately consider compelling state and local policy determinations and only serves to impede the development of newer, cleaner sources of energy.”

Recent technological innovations in the production of natural gas through hydraulic fracturing and directional drilling has resulted in a wave of applications to develop new interstate natural gas transmission pipelines. Reports presented to Congress by advocates for the natural gas pipeline industry estimate the need to construct annually, every year through 2035, 1,400 miles of gas transmission pipeline in the United States and Canada. The Marcellus and Utica shale fracking boom in the Northeast has spurred the proposal and construction of multiple pipelines to transport unconventional shale gas through New Jersey.

“New Jersey is the most densely-populated state and, consequently, one of the first to establish open space and farmland preservation programs in order to dedicate land for those purposes,” said Benson (D-Mercer/Middlesex). “However, the federal approval process allows for the location of interstate natural gas pipelines through irreplaceable preserved farms, forests, and environmentally sensitive areas, leading to the destruction of fragile habitat and an erosion of the quality life for countless residents.”

Under the National Environmental Policy Act (NEPA), prior to approving a proposed pipeline, FERC is required to consider a wide range of potential environmental impacts, including the “cumulative impacts” of a project, those that result from a proposed pipeline project as well as past, present, and foreseeable projects which may be minor individually but collectively are significant. However, the United States Court of Appeals has held that FERC violated NEPA by segmenting its environmental review and failing to provide a meaningful analysis of the cumulative impacts of pipeline projects.

In light of this, the sponsors¡¦ resolution urges Congress to enact legislation requiring FERC:

  • to use comprehensive data and planning tools to determine if new transmission capacity is needed;
    • to develop and undertake regional programmatic environmental impact statements that consider a full range of alternatives and mitigation measures and provide FERC information to evaluate potential cumulative impacts of the reasonably foreseeable actions of pipelines that may be proposed for development across a region; and
      • to consider all cumulative impacts and indirect effects of prospective pipeline proposals on a region.

      The measure was approved 55-4-12 and now heads to the Senate for further consideration.