Court backs FERC on Millennium project, finds New York review exceeds a year

Washington (Platts)--12 Mar 2018 705 pm EDT/2305 GMT

A court Monday let stand a US Federal Energy Regulatory Commission decision that booted New York out of the permitting process for a Millennium Pipeline natural gas lateral to a CPV Valley power plant in New York, affirming rulings that allowed the gas project to move past a delay at the state level and into the construction phase.

A decision Monday by the US 2nd Circuit Court of Appeals denied a petition by the New York State Department of Environmental Conservation that had asked the court to vacate two FERC orders that allowed Millennium to start building the 127,200 Dt/d Valley Lateral project.

The court agreed with FERC that the state agency had waived its authority to review Millennium's request for a Clean Water Act Section 401 certificate by failing to act on the company's application within one year.

"The plain language of Section 401 outlines a bright-line rule regarding the beginning of review: the timeline for a state's action regarding a request for certification 'shall not exceed one year' after 'receipt of such request,'" the court said. "It does not specify that this time limit applies only for 'complete' applications. If the statute required 'complete' applications, states could blur this brightline rule into a subjective standard, dictating that applications are 'complete' only when state agencies decide that they have all the information they need."

The court also confirmed that FERC had jurisdiction over the gas transportation project.

"Millennium is pleased with the court's precedent-setting decision that affirms FERC's interpretation of the Clean Water Act, which will allow us to continue with construction," Millennium spokeswoman Michelle Hook said, noting that the FERC certificate carried environmental mitigation measures.

Millennium completed a critical section of the eight-mile lateral at the end of December and plans to finish the project this summer. The $57 million lateral will bring gas to CPV Valley's approximately $900 million, 720-MW CPV Valley Energy Center in Orange County, New York.

The case had bounced around before it came to the 2nd Circuit. FERC approved the project in November 2016. Frustrated with a state delay in issuing a decision on the water permit, Millennium asked the DC Circuit Court of Appeals to compel the state DEC to issue the permit, but the court said the company would have to seek a remedy at FERC.

On August 30, 2017, two years after Millennium had first applied for the water permit, the state denied the company's application. In September 2017, FERC found that the state agency had waived its authority due to the delay. After the state agency and landowners who opposed the project made an unsuccessful attempt to obtain rehearing from FERC, they asked the 2nd Circuit to review both the FERC waiver order and the order rejecting rehearing. -- Sean Sullivan,

-- Edited by Christopher Newkumet,

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