U.S. EPA Removes Regulatory Affirmative Defense Provision Against Alleged Violations of Oil and Gas Facility NESHAPs

On October 22, 2024, the U.S. Environmental Protection Agency (EPA) published a final rule removing an affirmative defense from Clean Air Act (CAA) National Emission Standards for Hazardous Air Pollutants (NESHAP) regulations for the Oil and Natural Gas Production Facility and Natural Gas Transmission and Storage Facility Source Categories (Final Rule).[1] Prior to the Final Rule, owners or operators could assert an affirmative defense that alleged NESHAP standard violations were caused by an equipment malfunction.[2] A “malfunction” is defined as any sudden, infrequent, and not reasonably preventable failure of air pollution control and monitoring equipment, process equipment, or a process to operate in a normal or usual manner.[3]

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U.S. FERC: The Next Battleground for Defining “Responsibly Sourced Natural Gas”

The U.S. Federal Energy Regulatory Commission (FERC) is expected to issue an order later this month that could influence the development of “responsibly sourced natural gas” (RSG), natural gas certified by a qualified third party as meeting certain performance and operational criteria. Some in the energy industry have touted RSG as a way to meet net-zero and lower carbon emissions goals. (more…)

FERC Proposes Changes to Filing Requirements for Natural Gas Act Rate Cases

At its May 19, 2022, Open Meeting, the Federal Energy Regulatory Commission (FERC or the Commission) announced a Notice of Proposed Rulemaking (NOPR) on potential changes as to how natural gas pipelines submit supporting statements, schedules, and workpapers when filing a Natural Gas Act (NGA) Section 4 rate case. (more…)

FERC Rolls Back its Recently Enacted Policy Statements on the Certification of New Natural Gas Infrastructure

The Federal Energy Regulatory Commission (FERC) announced on March 24, 2022, that it will delay enacting any changes to its existing policies on the authorization or certification of interstate natural gas pipeline infrastructure under Sections 3 and 7 of the Natural Gas Act. Two policy statements FERC issued on February 18, 2022, in Docket No. PL18-1 and Docket No. PL21-3 (collectively, the 2022 Certificate Policy Statements) have now been deemed “drafts” that are subject to further comment. Initial comments will be due on April 25, 2022, with reply comments due on May 25, 2022. One of the two policy statements, which had been deemed “interim” but given immediate legal effect on February 18 prior to being relabeled a “draft” on March 24, had an initial comment date of April 4, 2022, which has now been extended to the aforementioned dates. Sidley provided a detailed summary of the changes implemented in the 2022 Certificate Policy Statements in a prior client alert and Energy Brief. (more…)

Climate Change Takes Center Stage in FERC’s Updated Policy on the Certification of New Natural Gas Infrastructure

On February 18, 2022, the Federal Energy Regulatory Commission (“FERC”) announced for the first time that it will consider a proposed natural gas infrastructure project’s impact on climate change as part of its public interest determination under sections 3 and 7 of the Natural Gas Act (“NGA”).  A proposed project’s environmental effects, including reasonably foreseeable greenhouse gas emissions that may be attributable to the project and the project’s impact on environmental justice communities, now will become part of FERC’s balancing test for whether a project is: (1) required by the public convenience and necessity (“PCN”) under NGA section 7; (2) or in the public interest under NGA section 3.  FERC’s prior PCN policy prioritized economic factors to define public need. Environmental effects, while considered under the NGA, were addressed primarily under the National Environmental Policy Act (“NEPA”). (more…)