On September 11, 2020, the US Environmental Protection Agency’s (USEPA) new rule updating and clarifying the substantive and procedural requirements for water quality certification under Clean Water Act (CWA) Section 401 became effective. The USEPA’s rule was in response to President Trump’s April 10, 2019, executive order Promoting Energy Infrastructure and Economic Growth. USEPA’s Clean Water Act Section 401 Certification Rule seeks to (1) clarify the time in which a state (or tribe that has been approved for ‘‘treatment as a state’’ status) has to review a request for certification under Section 401 and (2) provide project sponsors with predictability regarding the scope, procedures, and possible conditions of a state’s certification review.
A key component of USEPA’s new rule is the CWA’s “reasonable period” of time a state has to act on a request for certification. The new rule clarifies that “[t]he Federal agency shall establish the reasonable period of time either categorically or on a case-by-case basis” subject to the requirement that the “reasonable period of time shall not exceed one year from receipt.”1 In response, the Federal Energy Regulatory Commission (FERC) has elected to establish a categorical rule as opposed to deciding the reasonable period of time on a case-by-case basis.
In its September 9, 2020, Notice of Proposed Rulemaking, FERC proposes codifying its prior practice of applying a fixed one-year waiver period for all applications filed in connection with proposed natural gas or liquefied natural gas infrastructure projects. Specifically, a new Part 157.22(b) would be added to Title 18 of the Code of Federal Regulations as follows:
For requests for a water quality certification submitted pursuant to section 401(a)(1) of the Federal Water Pollution Control Act (Clean Water Act) in connection with a project for which authorization is sought from the Commission under section 3 or 7 of the Natural Gas Act, the reasonable period of time during which the certifying agency may act on the water quality certification request is one year from the certifying agency’s receipt of the request. A certifying agency is deemed to have waived the certification requirements of section 401(a)(1) of the Clean Water Act if the certifying agency has not denied or granted certification by one year after the date the certifying agency received a written request for certification.
In the notice, FERC explained it “continue[s] to believe that the benefits of setting a categorical waiver period of one year, as permitted by the CWA, best serves the public interest by avoiding uncertainty associated with open-ended and varying certification deadlines.” The factors underlying its belief were articulated to include:
- It would be administratively inefficient and a potential source of controversy to establish reasonable time periods on a case-by-case basis.
- State and tribal certifying agencies may vary in terms of their procedures for reviewing requests for water quality certification.
- Natural gas projects include highly complex proposals that may well take a state significant time to review.
If you have any questions regarding the content of this alert, please contact Yvonne Hennessey, chair of the Environmental and Lobbying & Election Law Compliance Practice Areas and co-team leader of the Oil & Gas, Linear Infrastructure, and Energy Markets Teams, at yhennessey@barclaydamon.com.
1 40 CFR §121.6(a).