FERC Dismisses Requests for Rehearing in Algonquin Gas

On May 19, 2021, the U.S. Federal Energy Regulatory Commission (FERC) issued an order dismissing rehearing requests (Dismissal Order) of its February 18, 2021, Order Establishing Briefing in Algonquin Gas Transmission, LLC (Docket No. CP16-9-012) (Briefing Order). The Briefing Order had found that concerns raised regarding the operation of a compressor station that FERC had authorized to place into service on September 24, 2020, warranted further consideration. FERC set the matter for a paper hearing, with deadlines established for initial and reply briefs. The Briefing Order drew fierce criticism in dissents by Commissioners Mark Christie and James Danly on grounds that FERC was acting outside of its statutory authority and resulted in over 100 comments and briefs filed by a diverse group of pipeline industry members and advocates, environmental nongovernmental organizations and consumer groups, and former FERC commissioners as well as requests for rehearing by the affected pipeline and four individual trade associations representing pipeline operators, investors, and shippers.

FERC’s stated rationale for dismissing the rehearing requests was that the Briefing Order was interlocutory and procedural, meaning that none of the parties was “aggrieved” within the meaning of Section 19(a) of the Natural Gas Act and thus lacked standing to sue. FERC determined that the petitioners of rehearing were not faced with an “irreparable injury” that necessitated rehearing. FERC instead held that allowing the rehearing requests would create unnecessary delays during the administrative proceeding.

Commissioners Christie and Danly dissented to the Dismissal Order as well, with both repeating their prior allegations that the Briefing Order reopened the record of a final certificate proceeding without statutory authority to do so, allowing the project to be relitigated after the applicant and its investors committed to invest hundreds of millions of dollars in the compressor station’s construction and operation. Commissioner Danly also explained why he disagreed with the majority’s finding of nonaggrievement in the Dismissal Order and why the petitioners were irreparably harmed by the Briefing Order. His dissent attached comments filed in the docket by seven former FERC commissioners arguing that the Briefing Order “threatens to impede the development of all infrastructure projects subject to the Commission’s jurisdiction.”

This post is as of the posting date stated above. Sidley Austin LLP assumes no duty to update this post or post about any subsequent developments having a bearing on this post.