FERC eschews social cost of carbon measurement in new downstream analysis
- Responding to an appeals court decision, federal regulators have issued a draft supplemental environmental impact statement that considers the downstream emissions impacts of the Southeast Market Pipelines Project.
- The Federal Energy Regulatory Commission concluded the group of pipeline projects could boost Florida's greenhouse gas emissions between 3.7% and 9.7%, though the high-end estimate is considered unlikely. FERC declined to utilize the social cost of carbon (SCC) calculation devised by the Obama administration, saying no consensus exists for the appropriate discount rate for analyses and there are no established criteria identifying monetized values to consider.
- In August, the U.S. Court of Appeals for the District of Columbia Circuit ordered FERC to consider downstream emissions in its environmental reviews of pipelines.
The supplemental environmental review FERC issued last week does not propose to change the outcome of the commission's findings, but the very inclusion of climate impacts in the commission's review is a win for conservation advocates.
FERC concluded that constructing and operating the project would "result in temporary and permanent impacts on the environment," but with sufficient mitigation measures "operating the SMP Project would not result in a significant impact on the environment."
But the commission stopped short of utilizing the social cost of carbon measurements devised by an inter-agency working group during the Obama administration. In their decision, FERC regulators wrote that they could not use the value because there is no consensus on the "appropriate [discount] rate for analyses spanning multiple generations," the tool does not "measure actual incremental impacts" on the environment, and there are no "established criteria for identifying the monetized values" to be considered.
"The SCC tool may be useful for rulemakings or comparing regulatory alternatives using cost-benefit analyses where the same discount rate is consistently applied," FERC wrote. "However, it is not appropriate for estimating a specific project's impact or informing our analysis."
The case marked the second time in August where a federal court ruled that downstream impacts must be considered in environmental reviews. A district court judge rejected a Montana coal mine expansion in Montana Environmental Information Center v. U.S. Office of Surface Mining.
The Southeast Market Pipelines Project consists of three pipelines, the largest of which is the Sabal Trail pipeline in Florida. It would run more than 500 miles through Alabama, Georgia and Florida, and would supply gas to Florida Power and Light and Duke Energy of Florida.
The project is a joint venture of Spectra Energy Partners, NextEra Energy and Duke Energy.
FERC's project approvals ground to a halt earlier this year as the commission was without the required three members to field a quorum. But President Trump's new appointees have begun to reach the commission, and the White House has issued an executive order aimed at easing the siting of major infrastructure,
- The Washington Examiner FERC takes first step in accounting for climate change in pipeline reviews
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