The Fourth U.S. Circuit Court of Appeals vacated the West Virginia Department of Environmental Protection’s (DEP) water permit of the 303-mile Mountain Valley natural gas pipeline (MVP), supposedly finding multiple defects in its review of the project. Just prior to this ruling, the court had upheld the sufficiency of Virginia’s environmental review, allowing it to grant the pipeline a water permit to cross through that state’s streams and wetlands. The three-judge panel, however, found 139 state stormwater permit violations and at least 46 “narrative water quality standards violations” that it felt had not been sufficiently addressed by the West Virginia Department of Environmental Protection (DEP). Chief Judge Roger Gregory indicated in the court’s opinion that “[DEP] failed to provide a reasoned explanation as to why it believes MVP’s past permit violations will not continue to occur going forward.”
Construction on the pipeline in West Virginia cannot resume until the West Virginia DEP reconsiders the permit required under Clean Water Act Section 401 to allow the crossing of streams and wetlands. The pipeline is 94 percent complete with 283 miles of pipe laid and is fully subscribed for its throughput. It is a major priority for Senator Joe Manchin of West Virginia, who tried to get permitting reform passed in Congress to avoid such issues from delaying energy projects such as the MVP that was originally scheduled for completion in 2018 and is now costing the company $6.6 billion, almost double the original estimate of $3.5 million. Once completed, the MVP would bring 2 billion cubic feet per day of natural gas from West Virginia to Virginia and North Carolina. According to Senator Manchin, “This project has been through three rounds of water quality permitting, but activist groups continue to litigate the last 20 miles.”
Virginia Water Permit
In 2021, environmental groups including the Sierra Club asked the 4th Circuit court to vacate the Clean Water Act permit, claiming that Virginia rubber-stamped the project without considering numerous environmental concerns. The 4th Circuit’s three-judge panel rejected those claims, finding the state considered alternative pathways and took into account thousands of public comments on the pipeline’s impacts before approving the permit. The Mountain Valley pipeline has been the subject of numerous lawsuits, including an earlier challenge to a general water construction permit issued by the U.S. Army Corps of Engineers, which the 4th Circuit vacated in 2018. After the court vacated the general permit, Equitrans, the owner, requested individual Clean Water Act permits from Virginia and West Virginia agencies.
Status of Permitting Reform
On September 21, 2022, Senator Manchin unveiled his energy permitting bill. The bill would approve permits for the Mountain Valley Pipeline, establish new deadlines for federal environmental reviews of two years for major projects and one year for those less significant, set time limits on court challenges and expedite Clean Water Act permits. It would also require the president to keep a list of 25 energy projects of strategic national importance for 10 years, specifying that for the first seven of those years, five of the 25 projects must be related to either fossil fuels or biofuels, six must be for clean energy and four must be related to critical minerals. According to Manchin, “It takes us two to three times longer than any nation in the world to get anything done.”
Manchin’s legislation would also set a statute of limitations barring challenges to agency permitting decisions that are not filed within 150 days. It would give the Federal Energy Regulatory Commission the authority to promote transmission facilities both within and between regions of the country so that the nation’s electric grid can be rebuilt for renewable energy, which has caused systems to trip. The permitting overhaul would help build out transmission lines needed to carry renewable power projects, such as wind turbines and solar-panel installations, from remote locations to U.S. demand centers. According to Princeton’s Net Zero America study, the United States will need to increase its transmission grid capacity by 60 percent by 2030 and triple it by 2050 to achieve deep decarbonization via electrification. The existing capacity was built over the last century and more.
Despite Senate Majority Leader Schumer promising to attach the proposed bill to government funding legislation, Manchin’s permitting reform went nowhere. Senator Shelley Moore Capito had an alternate bill that would also speed up the timeline for environmental reviews, which also went nowhere.
Last month, the U.S. House of Representatives released its energy bill, H.R. 1, the Lower Energy Costs Act which includes permitting reform, which would reduce regulatory burdens that make it harder to build major infrastructure in the United States. The proposed law would also reform the National Environmental Policy Act (NEPA) which currently adds years of delays and millions of dollars in costs to energy and infrastructure projects. It would provide a streamlined, simplified permitting process for all federally impacted projects, speeding construction for pipelines, transmission, and water infrastructure. By fast-tracking the approval process for American energy production on federal lands and waters and speeding up the permitting process, the bill would lower costs for Americans and help grow the U.S. economy.
H.R. 1 passed the House in a bipartisan vote. But, Senate Majority Leader, Chuck Schumer, is unlikely to allow a vote in the Senate as he called the legislation a “partisan, dead-on-arrival and unserious proposal for addressing America’s energy needs that they have laughingly labeled H.R. 1.” President Biden has already announced that he would veto it.
Permitting reform is clearly needed as evidenced by the data. The Energy Information Administration (EIA) recently reported that interstate natural gas pipeline capacity additions reached a record low in 2022 based on data collected over 27 years. In 2022, 897 million cubic feet per day of interstate natural gas pipeline capacity was added from five projects, with only one project adding a relatively small amount of new pipe. The 2022 gas pipeline capacity additions were just 3 percent of the record amount added (28,040 million cubic feet per day) in 2017. Regulatory hurdles are clearly stymying growth in pipeline capacity and thus to natural gas production, which points to much-needed permitting reform for interstate pipelines and other energy infrastructure.
The Mountain Valley Pipeline is still in limbo as the 4th Circuit court vacated its water permit from the West Virginia DEP, supposedly finding a number of violations. Despite getting court approval for Virginia’s water permit and costing almost double the initial estimate, the MVP will have to undergo another lengthy review process as the 185 possible violations are assessed and dealt with. Clearly, permitting reform is needed as these delays drastically increase project costs. In this case, it means Americans will have to pay more for natural gas. But since the current permitting process affects all energy forms, Americans are paying more for energy than they need to because of these delays and legal issues. In the past, people complained about “red tape” tying up projects. Now, they can accurately complain about the “green tape” that is making their lives more difficult.