Week Ending June 22, 2018

Commissioners Address Pipeline Certificate Policy Statement, Security Issues

This Article Appears as Published in Foster Report No 3204
Commissioners Address Pipeline Certificate Policy Statement, Security Issues

Natural gas pipeline siting and pipeline security were touched on by FERC commissioners and the pipeline industry in several different venues in the past week. FERC Chairman Kevin McIntyre addressed security issues in light of a joint op-ed written by Commissioners Neil Chatterjee and Richard Glick and the head of the Interstate Natural Gas Association of America (INGAA) discussed the possibility of moving pipeline safety oversight out of the Department of Transportation (DOT).

The oversight role of DOT’s Pipeline and Hazardous Materials Safety Administration (PHMSA) also was discussed at a June 21 hearing before a House of Representatives subcommittee on railroads, pipelines and hazardous materials. PHMSA Administrator Howard “Skip” Elliott and representatives from INGAA, the Association of Oil Pipe Lines, the American Petroleum Institute and the Pipeline Safety Trust testified on safety issues and the work of the pipeline advisory committees that have proved valuable to all parties following PHMSA’s work.

The Commission’s natural gas pipeline certificate policy statement, which is the subject of a notice of inquiry (PL18-1) on whether changes are needed, was discussed by McIntyre at the media briefing after FERC’s June 21 open meeting. The comment deadline is July 25, and McIntyre has maintained that he has an open mind on whether the 1999 policy statement is in need of revision.

Since the NOI was issued a few months ago, Glick and Commissioner Cheryl LaFleur have issued dissenting statements in orders on FERC pipeline certificate cases, asserting that the heavy reliance on precedent agreements as indicators of project need, consideration of impacts related to greenhouse gas (GHG) emissions and other elements merit increased attention. Those statements have not changed McIntyre’s view that the NOI will be guided by comments received on the record, or that the policy statement may or may not be changed to address such issues, he told reporters.

When asked about a policy change made in a certificate case involving Dominion Transmission Inc., which drew dissenting votes and statements from Glick and LaFleur, McIntyre said he sees no conflict between addressing certificate cases while the policy statement is being reviewed.

In that case, FERC staked out a different position on assessing the environmental impacts of natural gas pipeline projects by not providing estimates of upstream and downstream GHG emission data when such information is not reasonably foreseeable. LaFleur and Glick said the move limits FERC’s consideration of climate change impacts in pipeline projects, is contrary to the requirements of the National Environmental Policy Act (NEPA) and comes at a bad time, as FERC has a pending review of its policy statement.

McIntyre said he sees no benefit to “putting our pencils down” on pending pipeline certificate cases while the policy statement is reviewed.

He also said he has not formulated an opinion on pipeline security oversight and cybersecurity issues raised by Chatterjee and Glick in their June 18 op-ed that appeared in the Houston Chronicle. McIntyre noted that cybersecurity is an important area for all elements of critical energy infrastructure, and he would not be terribly surprised to see FERC move in the direction advocated by his fellow commissioners. “We’re just not there now,” he said.

In their op-ed, Chatterjee and Glick note that although the Transportation Security Administration has the authority to enforce mandatory standards to protect pipelines from cyber-attacks, TSA has chosen to rely on voluntary standards. They advocated for mandatory standards, while acknowledging that mandatory cybersecurity standards “are not a panacea.”

They asserted that Congress should move responsibility for pipeline security to an agency that fully comprehends the energy sector, and that the Department of Energy would be an appropriate choice. “Such a move would be particularly timely given the Energy Department’s recent announcement that it will be forming an office specifically focused on cybersecurity,” Chatterjee and Glick said.

“Regardless of where Congress vests this responsibility, the regulator must have the statutory authority, resources, and commitment to implement mandatory cybersecurity standards for gas pipelines,” they said.

At a June 18 media briefing on pipeline infrastructure issues, INGAA President and CEO Don Santa noted that cybersecurity for pipelines has received a lot of attention lately. Changing the agencies responsible for oversight away from TSA would take an act of Congress, and there are not may laws that make it to the president’s desk these days, Santa said.

The pipeline sector and government agencies share data on physical and cybersecurity risks, and the important thing is for safety and security measures to be addressed, Santa said. Cybersecurity is terribly important for pipelines and the energy sector, and because they are a mode of transportation, authority under TSA makes sense, Santa said.

If TSA efforts on cybersecurity need to be improved, the industry and policymakers would be better off focusing on that rather than trying to change authority and oversight roles to other agencies, he said.

By Tom Tiernan TTiernan@fosterreport.com

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