What FERC’s Approval of Cove Point LNG Tells Us About the “Rubberstamp” Agency

14645003974_5c08995611_hOn September 29, the Federal Energy Regulatory Commission put its stamp of approval on the Cove Point LNG project, Dominion Resources’ bid to convert its liquefied natural gas import terminal on the Chesapeake Bay into an export facility. It’s the fourth approval FERC has granted to build an export facility, and the first on the Atlantic Coast. The first three are located on the Gulf Coast.

Why is Cove Point important? Some have been calling it “the next Keystone XL.” What the Keystone XL pipeline is to the Alberta tar sands, Cove Point is to the Marcellus Shale, a porous rock formation harboring as much as 500 tcf of methane gas. If constructed, the Keystone XL would be a major conduit of dirty bitumen from the tar sands, and consequently it’s become the rallying call for opposition against extraction of the tar sands. Likewise, if Cove Point is built, it would be the conduit for natural gas obtained by fracking the Marcellus Shale to be delivered to Asia. Among the export terminals approved by the Department of Energy and in line for approval by FERC, Cove Point has become the rallying cry for opposition against liquefied natural gas exports. (In July, more than a thousand people marched in Washington, DC against Cove Point and LNG exports.) LNG exports are intimately connected with the extreme method of fossil fuel extraction called hydraulic fracking, because exporting to Asian markets would make fracking more profitable and thereby incentivize more drilling.

FERC’s permitting of Cove Point is a big regulatory hurdle, the biggest among many state and local permits it had to obtain after the Department of Energy said it was okay for Dominion to export. But it’s not a surprise. When I say FERC put its stamp of approval on Cove Point LNG, what I really mean is that FERC applied its rubberstamp of approval. FERC is responsible for reviewing proposals for interstate natural gas pipelines and LNG terminals (up to this point, only import terminals). Among the all the major projects submitted to FERC, you’d be hard-pressed to find one that was turned down. FERC’s nickname—the Federal Energy Rubberstamp Commission—is well-earned.

In my opinion, however, FERC is even more than a rubberstamp—it’s the gas industry’s best friend. Understanding that the game is rigged and how the game is rigged is important if we’re going to contest the coming wave of infrastructure associated with the fracking boom. Continue reading

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