Federal Environmental Laws That May Be Involved in the Pipeline Permitting Process

Several federal environmental laws and agencies may come into play in  the permitting process for natural gas pipelines, depending on the  proposed route for the pipeline. Federal resource agencies are  responsible for managing and protecting natural and cultural  resources such as wetlands, forests, wildlife, and historic properties. The Interstate and Intrastate Pipeline Permitting Processes Can be Complex, with Multiple Stakeholders and Steps

Both the interstate and intrastate pipeline permitting processes are  complex in that they can involve multiple federal, state, and local  agencies, as well as public interest groups and citizens, and include  multiple steps. The interstate permitting process involves three key  phases: a voluntary pre-filing phase, an application phase, and a post- authorization phase with multiple steps. According to stakeholders we  spoke with, the interstate process is consistent because FERC acts as a  lead agency in coordinating multiple stakeholders. The intrastate process  can also include multiple stakeholders and steps. In the  pre-filing phase, FERC and the applicant focus on gathering the  necessary information for the environmental analysis, which may involve  numerous federal, state, and local agencies and is typically the most  complex and time-consuming step of the permitting process. There is no  uniform standard for right-of-way agreements and eminent domain  authority, and procedures vary by state. Of the 11 states we reviewed, 5 have agencies charged with siting  intrastate natural gas pipelines. These 5 states require advance approval  of the location and the route of the pipeline. The remaining 6 do not have  siting agencies that require advance approval of location and route. State environmental laws and regulations are applicable to intrastate  pipelines. Time Frames for Interstate and Intrastate Pipeline Permitting Processes Vary Because of Multiple Factors

For interstate pipelines, FERC’s public record information system  contains documents that provide dates associated with the phases of the  permitting process; however, FERC does not track the time it takes to  complete the process. Using the information  available on interstate natural gas pipeline projects certified from January  1, 2010, to October 24, 2012, we determined that the average processing  time from pre-filing to certification for interstate natural gas pipeline  projects was 558 days, and the processing times ranged from 370 to 886  days. For  projects that begin in the application phase, the average processing time  from formal filing to certification was 225 days for this period. For intrastate pipelines, because the permitting process varies by state,  the time frames for those processes may also vary. Delays in state and local government reviews. State and local  permitting and review processes can take time and affect federal  decision-making time frames because some federal agencies cannot  issue their permits until state and local governments have completed  their own permitting processes. According to a Corps official and state officials, some states  experience delays in completing these reviews. Overlap of federal, state, and local environmental processes. Incomplete applications. Natural Gas Pipeline Stakeholders Identified Management Practices to Improve the Permitting Process

According to officials from federal and state agencies and representatives  from industry and public interest groups we interviewed, several  management practices could be implemented to help overcome some of  the challenges of a complex permitting process identified by these  stakeholders. Stakeholders we spoke with and the administration, in its plan for  implementing the executive order, identified the following management  practices as effective, among others:
Ensuring a lead agency is coordinating the efforts of federal, state,  and local permitting processes for intrastate pipelines. Representatives from industry and public interest groups we  interviewed noted that the interstate process is better coordinated  than intrastate processes because FERC is designated as the lead  agency for the environmental review of a pipeline project, but there is  no similar lead agency in the intrastate permitting process. Ensure effective collaboration of the numerous stakeholders. Providing planning tools to help companies plan routes for pipelines  and avoid sensitive environmental resources. Offering industry the option to fund contractors or agency staff to  expedite the permitting process. Increase the opportunities for public comments. The Department of Agriculture provided written comments in which they  generally agreed with the overall findings of the report. Appendix I: Objectives, Scope, and Methodology

Our objectives for this review were to determine (1) the processes  necessary for pipeline companies to acquire permits to construct  interstate and intrastate natural gas pipelines; (2) information available on  the time frames associated with the natural gas pipeline permitting  process; and (3) stakeholder-identified management practices, if any, that  may improve the permitting process. To understand processes and permits required to construct natural gas  pipelines at the federal level, we reviewed relevant federal laws and  regulations, as well as agency documentation, such as the interagency  agreement between the Federal Energy Regulatory Commission (FERC)  and nine other federal agencies regarding their coordination during the  review process for the National Environmental Policy Act and efforts to  facilitate the development of natural gas pipeline projects.
Why GAO Did This Study

Recent growth in domestic natural gas production, particularly due to increased production from shale, is resulting in an increase in the pipelines needed to transport that gas. Constructing natural gas pipelines requires clearing and maintaining rights-of-way, which may disturb habitat and historical and cultural resources. These resources are protected under a variety of federal, state, and local regulations implemented by multiple agencies. The laws, regulations and stakeholders involved in the permitting process depend on where the pipeline is constructed. FERC is the lead federal agency in approving interstate pipelines, coordinating with federal, state, and local agencies, but FERC is not involved in the approval of intrastate pipelines.
In response to the Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011, GAO determined (1) the processes necessary to acquire permits to construct interstate and intrastate natural gas pipelines, (2) information available on the time frames associated with the natural gas pipeline permitting process, and (3) stakeholder-identified management practices that may improve the permitting process. GAO reviewed relevant laws and regulations and interviewed federal officials, state officials from a nonprobability sample of 11 states, and representatives from natural gas industry associations and public interest groups.
GAO makes no recommendations in this report. The Departments of Agriculture and Defense generally agreed with the findings, and the other agencies had no comments

What GAO Found

Both the interstate and intrastate natural gas pipeline permitting processes are complex and can involve multiple federal, state, and local agencies, as well as public interest groups and citizens, and include multiple steps. The interstate process involves a voluntary pre-filing phase, an application phase, and a post-authorization phase with multiple steps that stakeholders reported to be consistent among projects because the process is led by the Federal Energy Regulatory Commission (FERC). FERC coordinates with federal, state, and local agencies that have statutory and regulatory authority over various environmental laws and regulations. For example, if a proposed pipeline may affect endangered species, FERC coordinates with the U.S. Fish and Wildlife Service, which reviews the impacts on such species. The intrastate process can also involve multiple stakeholders and steps, but, unlike in the interstate process, GAO found that the stakeholders and steps vary by state. For example, of the 11 states GAO reviewed, 5 have agencies charged with approving the route of natural gas pipelines and require advance approval of the location and route, and the remaining 6 do not. Pipeline companies must also comply with various federal and state environmental laws and regulations; however, in most of the 11 states, no one agency is charged with coordinating the implementation of these laws and regulations as FERC is for the interstate process.
Time frames associated with the interstate and intrastate permitting processes vary because of multiple factors, according to stakeholders. For the interstate process, FERC does not track time frames, citing the limited usefulness of such data. GAO analyzed public records and found that, for those projects that were approved from January 2010 to October 2012, the average time from pre-filing to certification was 558 days; the average time for those projects that began at the application phase was 225 days. For the intrastate process, because processes vary by state, the time frames of those processes may also vary. GAO found little comprehensive data on the intrastate process. According to GAO's discussions with stakeholders, several factors can affect the time frame for the permitting process of a given project, including different types of federal permits or authorizations, delays in the reviews needed by governmental stakeholders, and incomplete applications. For example, state and local permitting and review processes can affect federal decision-making time frames because some federal agencies will not issue their permits until state and local governments have completed their own permitting processes, according to some stakeholders.
Officials from federal and state agencies and representatives from industry and public interest groups told GAO that several management practices could help overcome challenges they associated with an efficient permitting process and obtaining public input: (1) ensure a lead agency is coordinating the efforts of federal, state, and local permitting processes for intrastate pipelines, (2) ensure effective collaboration of the numerous stakeholders involved in the permitting process, (3) provide planning tools to assist companies in routing pipelines and avoiding sensitive environmental resources, (4) offer industry the option to fund contractors or agency staff to expedite the permitting process, and (5) increase the opportunities for public comments.