[Federal Register Volume 86, Number 91 (Thursday, May 13, 2021)]
[Rules and Regulations]
[Pages 26150-26164]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-09829]


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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 157

[Docket No. RM20-15-001; Order No. 871-B]


Limiting Authorizations To Proceed With Construction Activities 
Pending Rehearing

AGENCY: Federal Energy Regulatory Commission, Department of Energy.

[[Page 26151]]


ACTION: Order addressing arguments raised on rehearing and 
clarification, and setting aside, in part, prior order.

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SUMMARY: The Federal Energy Regulatory Commission (Commission) 
addresses requests for rehearing and clarification on Order No. 871. In 
Order No. 871, the Commission issued a final rule to amend its 
regulations to preclude the issuance of authorizations to proceed with 
construction activities with respect to natural gas facilities approved 
pursuant to section 3 or section 7 of the Natural Gas Act (NGA) until 
either the time for filing a request for rehearing of such order has 
passed with no rehearing request being filed or the Commission has 
acted on the merits of any rehearing request. This order revises the 
rule to provide that it will apply only when a request for rehearing 
raises issues reflecting opposition to project construction, operation, 
or need. Further, this order revises the rule to provide that the limit 
on construction authorization will only apply until the earlier of the 
date that a qualifying rehearing request is no longer pending before 
the Commission or 90 days following the date that a qualifying request 
for rehearing may be deemed denied by operation of law. In addition, 
the Commission announces a general policy with respect to stays of NGA 
section 7(c) certificate orders, subject to a particularized 
application of the policy on a case-by-case basis, of its intent to 
stay its NGA section 7(c) certificate orders during the 30-day 
rehearing period and pending Commission resolution of any timely 
requests for rehearing filed by landowners, subject to the same 90-day 
time limitation referenced above and certain exceptions. This policy is 
not intended to prevent a project developer from continuing to engage 
in development related activities, as permitted consistent with the 
stay of the certificate, that do not require use of landowner property 
or that are voluntarily agreed to by the landowner during the stay 
period.

DATES: This rule is effective June 14, 2021.

FOR FURTHER INFORMATION CONTACT: Tara DiJohn, Office of the General 
Counsel, Federal Energy Regulatory Commission, 888 First Street NE, 
Washington, DC 20426, (202) 502-8671, tara.dijohn@ferc.gov.

SUPPLEMENTARY INFORMATION: 

Table of Contents

 
                                                              Paragraph
                                                               numbers
 
I. Background..............................................            3
II. Discussion.............................................           11
    A. Scope and Application of Order No. 871..............           11
    B. APA and NGA Requirements............................           31
    C. Commission Policy on Exercise of Eminent Domain                43
     Pending Rehearing.....................................
III. Regulatory Requirements...............................           52
    A. Information Collection Statement....................           52
    B. Environmental Analysis..............................           53
    C. Regulatory Flexibility Act..........................           54
    D. Document Availability...............................           55
    E. Effective Date......................................           58
 

    1. On June 9, 2020, the Federal Energy Regulatory Commission 
(Commission) issued in Order No. 871 a final rule that precludes the 
issuance of authorizations to proceed with construction activities with 
respect to a Natural Gas Act (NGA) section 3 \1\ authorization or 
section 7(c) \2\ certificate order until the Commission acts on the 
merits of any timely-filed request for rehearing or until the deadline 
for filing a timely request for rehearing has passed with no such 
request being filed.\3\ On July 9, 2020, the Interstate Natural Gas 
Association of America (INGAA) requested clarification or, in the 
alternative, rehearing, and Kinder Morgan, Inc. Natural Gas Entities 
\4\ (Kinder Morgan) and TC Energy Corporation (TC Energy) requested 
rehearing. On January 26, 2021, the Commission issued Order No. 871-A, 
which offered interested parties an opportunity to provide further 
briefing on the issues raised in INGAA's, Kinder Morgan's, and TC 
Energy's requests for rehearing, and set February 16, 2021, and March 
3, 2021, as the initial brief and reply brief deadlines, 
respectively.\5\
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    \1\ 15 U.S.C. 717b.
    \2\ 15 U.S.C. 717f(c).
    \3\ Limiting Authorizations to Proceed with Construction 
Activities Pending Rehearing, Order No. 871, 85 FR 40113 (July 6, 
2020), 171 FERC ] 61,201 (2020) (Order No. 871 or final rule).
    \4\ The Kinder Morgan Gas Entities include: Natural Gas Pipeline 
Company of America LLC; Tennessee Gas Pipeline Company, L.L.C.; 
Southern Natural Gas Company, L.L.C.; Colorado Interstate Gas 
Company, L.L.C.; Wyoming Interstate Company, L.L.C.; El Paso Natural 
Gas Company, L.L.C.; Mojave Pipeline Company, L.L.C.; Bear Creek 
Storage Company, L.L.C.; Cheyenne Plains Gas Pipeline Company, LLC; 
Elba Express Company, L.L.C.; Kinder Morgan Louisiana Pipeline LLC; 
Southern LNG Company, L.L.C.; and TransColorado Gas Transmission 
Company LLC.
    \5\ Limiting Authorizations to Proceed with Construction 
Activities Pending Rehearing, Order No. 871-A, 86 FR 7643 (Feb. 1, 
2021), 174 FERC ] 61,050 (2021) (Order No. 871-A).
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    2. Pursuant to Allegheny Defense Project v. FERC,\6\ the rehearing 
requests filed in this proceeding may be deemed denied by operation of 
law. However, as permitted by section 19(a) of the NGA,\7\ we are 
modifying the discussion in Order No. 871 and granting, in part, 
INGAA's request for clarification, setting aside and revising Order No. 
871 to resolve, in part, INGAA's, Kinder Morgan's, and TC Energy's 
requests for rehearing, and otherwise continuing to reach the same 
result as Order No. 871. As discussed further below, the Commission 
also adopts a policy of presumptively staying its NGA section 7(c) 
certificate orders during the 30-day rehearing period and pending 
Commission resolution of any timely requests for rehearing filed by 
landowners, subject to a time limitation and certain exceptions.\8\
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    \6\ 964 F.3d 1 (D.C. Cir. 2020) (en banc) (Allegheny).
    \7\ 15 U.S.C. 717r(a) (``Until the record in a proceeding shall 
have been filed in a court of appeals, as provided in subsection 
(b), the Commission may at any time, upon reasonable notice and in 
such manner as it shall deem proper, modify or set aside, in whole 
or in part, any finding or order made or issued by it under the 
provisions of this chapter.'').
    \8\ See discussion infra Part II.C.
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I. Background

    3. In Order No. 871, the Commission explained that historically, 
due to the complex nature of the matters raised on rehearing of orders 
granting authorizations under NGA sections 3 and 7, the Commission had 
often issued an order (known as a tolling order) by the thirtieth day 
following the filing of a rehearing request, allowing itself additional 
time to provide thoughtful,

[[Page 26152]]

well-considered attention to the issues raised on rehearing.
    4. In order to balance its commitment to expeditiously responding 
to parties' concerns in comprehensive orders on rehearing and the 
serious concerns posed by the possibility of construction proceeding 
prior to the completion of agency review, the Commission, in Order No. 
871, exercised its discretion by amending its regulations to add new 
Sec.  157.23, which precludes the issuance of authorizations to proceed 
with construction of projects authorized under NGA sections 3 and 7 
during the period for filing requests for rehearing of the initial 
orders or while rehearing is pending.\9\
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    \9\ Order No. 871 also revised Sec.  153.4 of the Commission's 
regulations to incorporate a cross-reference to new Sec.  157.23.
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    5. Three weeks after the Commission issued Order No. 871, the U.S. 
Court of Appeals for the District of Columbia Circuit (D.C. Circuit) 
issued an en banc decision in Allegheny.\10\ The court held that the 
Commission's use of tolling orders solely to allow itself additional 
time to consider an application for rehearing does not preclude 
operation of the NGA's deemed denial provision,\11\ which enables a 
rehearing applicant to seek judicial review after thirty days of agency 
inaction.\12\ The court explained that, to prevent a rehearing from 
being deemed denied, the Commission must act on an application for 
rehearing within thirty days of its filing by taking one of the four 
NGA-enumerated actions: Grant rehearing, deny rehearing, or abrogate or 
modify its order without further hearing.\13\
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    \10\ 964 F.3d 1.
    \11\ 15 U.S.C. 717r(a).
    \12\ Allegheny, 964 F.3d at 18-19.
    \13\ See id. at 13 (quoting 15 U.S.C. 717r(a)).
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    6. On July 9, 2020, INGAA filed a request for clarification or, in 
the alterative, rehearing of Order No. 871.\14\ On the same day, Kinder 
Morgan and TC Energy also filed requests for rehearing.\15\
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    \14\ INGAA's July 9, 2020 Motion to Intervene and Request for 
Clarification or, in the Alternative, Rehearing (INGAA Rehearing). 
INGAA's Rehearing included a motion to intervene in Docket No. RM20-
15-000. Intervention is not necessary in order to request rehearing 
of a rulemaking. See, e.g., Generic Determination of Rate of Return 
on Common Equity for Elec. Utilities, Order No. 389-A, 29 FERC ] 
61,223, at 61,459 n.2 (1984) (``Rhode Island also requested leave to 
intervene out of time. Intervention is not necessary in order to 
request rehearing of a rulemaking.''). Accordingly, INGAA's motion 
is unnecessary.
    \15\ Kinder Morgan's July 9, 2020 Request for Rehearing (Kinder 
Morgan Rehearing); TC Energy's July 9, 2020 Request for Rehearing 
(TC Energy Rehearing).
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    7. To facilitate our reconsideration of Order No. 871 and to ensure 
a complete record for further action, on January 26, 2021, the 
Commission issued an order providing interested parties an opportunity 
to comment on the arguments raised in the requests for rehearing.\16\ 
In particular, the Commission sought comment on five central questions: 
(a) Whether the final rule's application should be limited to certain 
issues or arguments raised on rehearing; (b) whether the final rule 
should apply to all orders pertaining to an NGA section 3 authorization 
or section 7 certificate or only a subset thereof; (c) how the final 
rule should apply following the Allegheny decision; (d) whether the 
Commission should modify its practices or procedures to address 
concerns regarding the exercise of eminent domain while rehearing is 
pending; and (e) whether the Commission should set a specific time 
limit after which an authorization to commence construction could 
issue.\17\
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    \16\ Order No. 871-A, 174 FERC ] 61,050. Several briefs filed in 
response to Order No. 871-A contained motions to intervene or were 
later supplemented by separately-filed motions to intervene. As we 
noted above, intervention in a rulemaking proceeding is not 
required. See supra note 14.
    \17\ For the full text of the questions posed by the Commission, 
see Order No. 871-A, 174 FERC ] 61,050 at P 7.
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    8. In response, the Commission received twelve initial briefs and 
five reply briefs. Seven initial briefs and three reply briefs came 
from various entities representing the natural gas industry, which 
generally oppose what is in their view the overly broad scope of the 
final rule, including: The three rehearing applicants (INGAA, Kinder 
Morgan, TC Energy); \18\ BHE Pipeline Group, LLC (BHE Pipeline); \19\ 
the Enbridge Gas Pipelines (Enbridge); \20\ the Gas and Oil Association 
of West Virginia, Inc. (Gas & Oil WV); \21\ and the Tallgrass Pipelines 
(Tallgrass).\22\
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    \18\ See INGAA's February 16, 2021 Initial Brief (INGAA Initial 
Brief) and March 3, 2021 Reply Brief (INGAA Reply Brief); Kinder 
Morgan's February 16, 2021 Initial Brief (Kinder Morgan Initial 
Brief) and March 3, 2021 Reply Brief (Kinder Morgan Reply Brief); TC 
Energy's February 16, 2021 Comments (TC Energy Initial Brief).
    \19\ See BHE Pipeline's February 16, 2021 Comments (BHE Pipeline 
Initial Brief).
    \20\ See Enbridge's February 16, 2021 Initial Brief (Enbridge 
Initial Brief) and March 3, 2021 Reply Brief (Enbridge Reply Brief).
    \21\ See Gas & Oil WV's February 16, 2021 Initial Brief (Gas & 
Oil WV Initial Brief).
    \22\ See Tallgrass's February 16, 2021 Comments (Tallgrass 
Initial Brief).
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    9. We received five initial briefs and two reply briefs supporting 
and, in some cases, seeking expansion of, the final rule from: 
Maryland, Massachusetts, New Jersey, Oregon, Rhode Island, and the 
District of Columbia (States); \23\ a consortium of public interest 
organizations (Public Interest Organizations); \24\ the Delaware 
Riverkeeper Network and Maya Van Rossum (Delaware Riverkeeper); \25\ 
the Niskanen Center and various landowners (Niskanen Center); \26\ and 
three individual landowners.\27\
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    \23\ See States' February 16, 2021 Brief (States Initial Brief).
    \24\ See Public Interest Organizations' February 16, 2021 Brief 
(Public Interest Organizations Initial Brief) and March 3, 2021 
Reply Brief (Public Interest Organizations Reply Brief). The Public 
Interest Organizations include: Alliance for the Shenandoah Valley; 
Appalachian Mountain Advocates; Appalachian Voices; Chesapeake Bay 
Foundation, Inc.; Cowpasture River Preservation Association; 
Earthjustice; Friends of Buckingham; Friends of Nelson; Highlanders 
for Responsible Development; Natural Resources Defense Council; 
Piedmont Environmental Council; Sierra Club; Sound Rivers, Inc.; 
Sustainable FERC Project; Virginia Wilderness Committee; Wild 
Virginia; and Winyah Rivers Alliance.
    \25\ See Delaware Riverkeeper's February 16, 2021 Brief 
(Delaware Riverkeeper Initial Brief).
    \26\ See Niskanen Center's February 16, 2021 Brief (Niskanen 
Center Initial Brief) and March 3, 2021 Reply Brief (Niskanen Center 
Reply Brief).
    \27\ See Deborah Evans, Ron Schaaf, and Bill Glow's February 16, 
2021 Comments (Landowners Initial Brief).
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    10. The Commission appreciates the additional briefing provided by 
the filers, as well as the diversity of perspectives represented. 
Taking those comments under consideration, the Commission addresses the 
issues raised on rehearing below.\28\
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    \28\ Some briefs raised issues outside the scope of the rule, 
such as the Commission's issuance of conditional certificates 
pursuant to NGA section 7 and the appropriate definition of pre-
construction activities. The Commission will not address those 
issues here. We note, however, that the Commission recently 
solicited comments on, among other things, its use of conditional 
certificates. See Certification of New Interstate Natural Gas 
Facilities, 174 FERC ] 61,125, at PP 13-15 (2021).
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II. Discussion

A. Scope and Application of Order No. 871

    11. INGAA seeks clarity regarding the scope and application of 
Order No. 871. Similarly, TC Energy seeks rehearing regarding the scope 
of Order No. 871. INGAA and TC Energy describe a number of 
circumstances that they contend would not implicate the concerns 
expressed by the Commission in promulgating Order No. 871 and ask the 
Commission to clarify Order No. 871 or revise it to provide that the 
rule does not apply in these circumstances. INGAA also asks the 
Commission to clarify how Order No. 871 will operate in light of 
certain rehearing procedures discussed in Allegheny.
1. Rehearing Requests That Do Not Oppose the Project
    12. INGAA asks the Commission to clarify that the rule precluding 
issuance of construction authorizations under

[[Page 26153]]

NGA sections 3 and 7 would not apply in situations where only the 
project developer, a shipper, or other party supporting construction of 
the project files a request for rehearing on non-construction related 
grounds, such as rate or tariff issues.\29\ In other words, INGAA seeks 
clarification that the rule would not apply where no affected landowner 
or other party that opposes the project seeks rehearing. Similarly, TC 
Energy seeks ``limited rehearing with respect to the breadth of the new 
regulation,'' and asserts that the Commission failed to engage in 
reasoned decision making by adopting an overly-broad regulation that 
would prevent an applicant from engaging in construction while a 
rehearing request is pending, even where the request does not challenge 
whether or how the project should be constructed.\30\
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    \29\ INGAA Rehearing at 13-16.
    \30\ TC Energy Rehearing at 4-6. TC Energy also asks the 
Commission to clarify that, ``as a general matter, it intends to 
continue its policy of being `less lenient in the grant of late 
interventions' in pipeline certificate proceedings, Tenn. Gas 
Pipeline Co., L.L.C., 162 FERC ] 61,167, at P 50 (2018), as well as 
its `general policy to deny late intervention at the rehearing 
stage.''' Id. (citing Tenn. Gas Pipeline Co., L.L.C., 163 FERC ] 
61,190, at P 4 (2018)). The Commission's late intervention policy is 
not relevant to Order No. 871. Therefore, we decline to take up TC 
Energy's invitation.
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    13. In addition, INGAA asks the Commission to clarify that the rule 
will not apply to any request for rehearing that only raises issues 
``related to a tariff, rate, terms or conditions of service, policy, or 
other matters that do not impact affected landowners.'' \31\ INGAA 
suggests, in the alternative, that the Commission add clarifying 
language in Sec.  157.23 specifying that the rule will apply only when 
rehearing is sought by an ``affected landowner'' as that term is 
defined in the Commission's regulations.\32\ This revision, INGAA 
explains, would ensure that the rule would not apply to projects where 
no affected landowners seek rehearing or to projects that do not 
involve the use of eminent domain authority.\33\ INGAA also urges the 
Commission to revise the rule to clarify that it does not apply to 
natural gas export or import facilities authorized under section 3 of 
the NGA because such authorizations do not confer eminent domain 
authority.\34\
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    \31\ INGAA Rehearing at 17 (emphasis added).
    \32\ 18 CFR 157.6(d)(2).
    \33\ INGAA Rehearing at 17. INGAA provides the following 
examples of NGA section 7 projects that would not involve the use of 
eminent domain authority: Projects involving construction on 
property owned or controlled by the pipeline, such as a compressor 
station project; modifications of existing facilities where 
construction would occur within the existing right-of-way; and 
projects where all easements have already been mutually agreed and 
secured. Id.
    \34\ Id. at 17-18.
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    14. As described below, we grant, in part, INGAA's request for 
clarification, setting aside and revising Order No. 871 to resolve, in 
part, INGAA's, Kinder Morgan's, and TC Energy's requests for rehearing 
and otherwise continue to reach the same result as Order No. 871. The 
Commission does not intend Order No. 871 to apply in instances where 
construction of the project is unopposed. Accordingly, we are revising 
the rule to clarify that the prohibition on issuing authorizations to 
proceed with construction during the rehearing period will not apply in 
proceedings where no party files a request for rehearing raising issues 
reflecting opposition to project construction, operation, or need.\35\ 
For example, requests for rehearing that only raise issues related to a 
tariff, rate, or terms or conditions of service would not trigger the 
rule's prohibition on construction authorizations. Contrary to some 
commenters' concerns about tailoring the scope of the rule to allow 
certain exceptions, the Commission is confident in its ability to 
administer the rule as revised.\36\
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    \35\ See infra P 30. Several commenters agree that the rule 
should be narrowed to not apply to rehearing requests filed by the 
project developer itself or another party that supports project 
construction (e.g., a shipper). See, e.g., Enbridge Initial Brief at 
10-11; Gas & Oil WV Initial Brief at 6; Niskanen Center Initial 
Brief at 12; Tallgrass Initial Brief at 13; TC Energy Initial Brief 
at 5-10; Enbridge Reply Brief at 7-10. Conversely, a few commenters 
argue that the rule should be retained without modification and that 
it should apply to all requests for rehearing regardless of the 
issues raised or the identity of the rehearing applicant, citing 
concerns about administering a rule with exceptions. See, e.g., 
Public Interest Organizations Initial Brief at 10 (``a rule without 
carve-outs is cleaner, clearer, and easier to administer''); 
Landowners Initial Brief at 2; Delaware Riverkeeper Initial Brief at 
6-8; States Initial Brief at 4 n.8 (``The Commission should not 
attempt to guess at the importance of certain issues and arguments, 
but instead withhold authorizations to commence construction during 
the pendency of all rehearing requests.'').
    \36\ We note that the Commission's administration of the rule is 
facilitated by the statutory and regulatory requirements that issues 
be raised on rehearing with specificity. See 15 U.S.C. 717r(a); see 
also 18 CFR 385.713(c)(2) (requiring that requests for rehearing 
include a ``separate section entitled `Statement of Issues,' listing 
each issue in a separately enumerated paragraph that includes 
representative Commission and court precedent on which the party is 
relying'').
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    15. However, we disagree with INGAA's suggestion that the 
Commission limit the rule's application to only those requests for 
rehearing filed by affected landowners, as that term is defined in our 
regulations.\37\ Adopting INGAA's suggestion would exclude from the 
rule's purview rehearing requests raising environmental matters or 
general opposition to a project, as well as rehearing requests filed by 
members of communities that would be impacted by the construction of 
new natural gas facilities.\38\ That was not our intent. In issuing 
Order No. 871, preventing potential impacts on affected landowners 
during the pendency of the rehearing period was a primary concern, but 
it was not the Commission's sole concern. We think it appropriate to 
refrain from permitting construction to proceed until the Commission 
has acted upon any request for rehearing that opposes project 
construction and operation or raises issues regarding project need, 
regardless of the basis or whether rehearing is sought by an affected 
landowner.\39\ INGAA fails to explain why these concerns are any less 
important in section 3 cases, where the project authorization does not 
confer eminent domain authority.\40\ We deny

[[Page 26154]]

this aspect of INGAA's request for clarification and continue to find 
that the intent of the Order No. 871 was to ensure that construction of 
an approved natural gas project will not commence until the Commission 
has acted upon the merits of a request for rehearing, ``regardless of 
land ownership.'' \41\
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    \37\ 18 CFR 157.6(d)(2). Some commenters on behalf of the 
natural gas industry agreed with INGAA's request to limit the rule's 
application to only rehearing requests filed by or implicating 
affected landowners. See, e.g., BHE Pipeline Initial Brief at 9-10; 
Enbridge Initial Brief at 6, 10; Enbridge Reply Brief at 7-9. But 
see Gas & Oil WV Initial Brief at 5 (rule, if retained, should be 
limited to rehearing requests raising ``clear threats of true 
irreparable harm to landowners or environmental justice communities 
directly in the path of a project.'') (emphasis added); BHE Pipeline 
Initial Brief at 5 (rule ``should be revised to apply only in 
limited circumstances requiring further review of matters raised by 
affected landowners or parties who will be directly impacted by 
immediate construction.'').
    \38\ The Commission has long recognized that communities 
surrounding a pipeline right-of-way have interests that may be 
adversely affected by approval of certificate projects. See 
Certification of New Interstate Natural Gas Pipeline Facilities, 88 
FERC ] 61,227, at 61,748, corrected, 89 FERC ] 61,040(1999), 
clarified, 90 FERC ] 61,128, further clarified, 92 FERC ] 61,094 
(2000).
    \39\ Governmental, environmental, and community interests are 
also impacted by projects approved under NGA sections 3 and 7, and 
the possibility of construction proceeding prior to the completion 
of agency review. See States Initial Brief at 2-6 (explaining that 
states, local governments, and tribes ``may oppose projects on 
grounds such as the public need for a project, a project's 
contribution to climate change, harm to the environment from the 
construction and operation of pipeline projects, noise and traffic 
impacts, effects on historical resources, and other concerns''); 
Public Interest Organizations Initial Brief at 8 (deeming it 
illogical to limit the rule's application to only landowner 
rehearing requests because ``the construction of a Commission-
approved gas project, and the permanent changes to the environment 
and cultural resources that are caused by such construction, are 
cognizable injuries.'').
    \40\ That an authorization under NGA section 3 does not confer 
eminent domain authority does not negate the existence of affected 
landowners who may oppose nearby construction of export or import 
facilities. An affected landowner, as defined in our regulations, 
and a landowner whose land is at risk of being acquired through 
eminent domain are not mutually exclusive. For example, an affected 
landowner can be one whose property ``[i]s within one-half mile of 
proposed . . . LNG facilities.'' 18 CFR 157.6(d)(2)(iii).
    \41\ Order No. 871, 171 FERC ] 61,201 at P 11 (emphasis added).
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2. Rehearing Requests of Non-Initial and Amendment Orders
    16. INGAA asks the Commission to clarify that construction could be 
allowed to proceed, even where a rehearing request has been filed, 
where rehearing is sought not of an initial order authorizing 
construction but of a subsequent order that merely implements the 
original authorization--such as orders relating to compliance with 
environmental conditions, requests for variances, notices to proceed 
with construction, or authorizations to place constructed facilities 
into service.\42\ This clarification, INGAA states, would prevent 
unnecessary delays or interruptions in project construction that could 
occur if project opponents request rehearing of subsequent orders that 
merely implement the terms and conditions of the initial order. For 
similar reasons, INGAA also seeks clarity that a bar on the 
commencement of construction arising from the filing of a rehearing 
request regarding an order amending the terms of an existing 
authorization would apply only to facilities approved in the amendment 
order, not to the facilities approved in the original order.
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    \42\ INGAA Rehearing at 19.
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    17. To the extent that a non-initial order merely implements the 
terms, conditions, or other provisions of an initial authorizing 
order--such as a delegated order issuing a notice to proceed with 
construction, approving a variance request, or allowing the applicant 
to place the project, or a portion thereof, in service--a request for 
rehearing of that order would not implicate the initial authorizing 
order and so we agree that the rule would not apply.\43\
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    \43\ A challenge to a non-initial order is appropriately 
confined in scope to the specific agency action being challenged and 
may not revisit findings of the initial order itself. See, e.g., 
Nat'l Comm. for the New River, Inc. v. FERC, 433 F.3d 830, 834 (D.C. 
Cir. 2005) (finding route alternative claim raised during initial 
certification process barred on res judicata grounds in subsequent 
review of pipeline's compliance with certificate conditions).
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    18. We also agree with INGAA that, with respect to amendments, 
Sec.  157.23's prohibition on the issuance of construction 
authorizations prior to Commission action on rehearing would apply only 
to the facilities approved by the amendment order for which rehearing 
is sought. It would not relate back to any facilities previously 
approved by the Commission in the initial authorizing order that remain 
unchanged by the amendment order.
3. Post-Allegheny Rehearing Treatment
    19. INGAA poses several circumstances that may unfold following 
Allegheny and asks the Commission to elaborate on whether and how the 
rule promulgated in Order No. 871 would apply in those cases. It asks 
the Commission to clarify that the rule would not apply once a 
rehearing request has been deemed denied by operation of law due to 
Commission inaction on the request for thirty days.\44\
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    \44\ INGAA Rehearing at 21-24. Notably, no commenters appear to 
argue that authorizations to proceed with construction should be 
allowed during the 30-day rehearing period following a Commission 
order issuing or amending a section 7 certificate or section 3 
authorization.
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    20. As further explained below, we revise the rule to provide that 
the limit on construction authorization will apply until the earlier of 
the date that (1) a qualifying rehearing request is no longer pending 
before the Commission or (2) 90 days following the date that a 
qualifying request for rehearing may be deemed denied. This revision 
reflects that, as permitted by NGA section 19(a), rehearing may be 
deemed denied by operation of law in the absence of Commission action 
on the merits by the 30th day following receipt of a rehearing request. 
Order No. 871's use of the phrase ``until the Commission has acted upon 
the merits of that request,'' assumed, incorrectly, that such action 
was statutorily required. The revision clarifies that the limitation on 
construction will apply so long as the rehearing remains pending or 
until 90 days following the date that a request for rehearing may be 
deemed denied. We next describe four scenarios following the filing of 
a rehearing request in the post-Allegheny landscape to further explain 
when a rehearing remains pending.
    21. First, the Commission could issue an order addressing the 
merits of the rehearing request before the thirtieth day following the 
date the request is filed. Pursuant to Order No. 871, because the 
Commission had acted on the merits of the rehearing request, and 
rehearing was no longer pending, authorization to proceed with 
construction could be issued so long as the certificate or 
authorization holder had also met the necessary conditions of the order 
associated with commencement of construction.
    22. Second, the Commission might not act on the merits within 
thirty days following the filing of a rehearing request. Under NGA 
section 19(a), such inaction by the Commission would mean that the 
request for rehearing may be deemed denied by operation of law. In such 
situations, the Commission might issue a notice indicating that 
rehearing may be deemed denied by operation of law. If this notice does 
not state that the Commission intends to take further action on the 
rehearing request, then rehearing is no longer pending before the 
Commission, and construction could be allowed to proceed.
    23. Third, the Commission might not act on a rehearing request 
within thirty days but might issue a notice indicating that rehearing 
may be deemed denied and also that the Commission intends to address 
the merits of the rehearing request in a future order, as provided in 
section 19(a) of the NGA.\45\ In such a case, rehearing is still 
pending before the Commission, and Order No. 871 would apply. 
Specifically, under Order No. 871 as issued, construction could not be 
allowed to proceed until the Commission issues its further order or 
otherwise indicates that the rehearing is no longer pending before the 
Commission by notice, order, or filing the record with the court of 
appeals (which affords the court exclusive jurisdiction to affirm, 
modify, or set aside the Commission's order(s)).\46\
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    \45\ 15 U.S.C. 717r(a).
    \46\ See id. 717r(b) (stating that upon the filing of a petition 
for judicial review, the court of appeals ``shall have jurisdiction, 
which upon the filing of the record with it shall be exclusive, to 
affirm, modify, or set aside such order in whole or in part.'') and 
id. 717r(c) (The commencement of judicial review proceedings ``shall 
not, unless specifically ordered by the court, operate as a stay of 
the Commission's order.'').
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    24. The States, the Public Interest Organizations, and the Niskanen 
Center generally support the application of the rule's restriction on 
construction in this manner.\47\ Delaware Riverkeeper urges us to take 
this a step further, arguing that the Commission should withhold 
construction authorization until the deadline for judicial review 
passes or until the reviewing court resolves the issues raised on 
appeal.\48\ Conversely, INGAA and most natural gas industry commenters 
argue that construction authorizations should be permitted once

[[Page 26155]]

a rehearing request is deemed denied by operation of law, regardless of 
whether the Commission signals its intent to issue a subsequent order 
addressing the arguments raised on rehearing. They assert that 
authorization to proceed with construction should be allowed following 
a deemed denial because at that point any party aggrieved by a 
Commission order would be free to seek judicial review and, if 
necessary, request injunctive relief from the court.\49\ Alternatively, 
INGAA and TC Energy suggest that construction authorizations should be 
allowed 30 days after a rehearing request is deemed denied (i.e., 
roughly 60 days after filing the rehearing request).\50\ According to 
INGAA and TC Energy, this approach would provide the Commission time to 
issue an order addressing the merits of the rehearing request, 
aggrieved parties time to file a petition for review and, if necessary, 
seek a judicial stay before any construction, and pipeline developers 
and customers with certainty regarding construction timelines.\51\
---------------------------------------------------------------------------

    \47\ See Public Interest Organizations Initial Brief at 12-13, 
15; States Initial Brief at 11; Niskanen Center Initial Brief at 14; 
see also Public Interest Organizations Reply Brief at 2-4.
    \48\ See Delaware Riverkeeper Initial Brief at 10-12.
    \49\ See, e.g., INGAA Initial Brief at 12; Enbridge Initial 
Brief at 14-16; BHE Pipeline Initial Brief at 11; Gas & Oil WV 
Initial Brief at 7; Tallgrass Initial Brief at 10-12; see also INGAA 
Reply Brief at 8-11; Enbridge Reply Brief at 14-17, 20-22.
    \50\ See INGAA Initial Brief at 28-30; TC Energy Initial Brief 
at 11.
    \51\ See INGAA Initial Brief at 28-30; TC Energy Initial Brief 
at 11-12.
---------------------------------------------------------------------------

    25. We clarify that construction may be permitted to proceed once 
the Commission issues its further order or the reviewing court 
otherwise obtains exclusive jurisdiction at the time the record is 
filed with it, as this signifies the completion of agency review. While 
the court may exercise ``judicial superintendence'' \52\ once rehearing 
is deemed denied, the Commission retains jurisdiction to ``modify or 
set aside, in whole or in part'' the certificate order for which 
rehearing has been sought until the record on review is filed with the 
court of appeals. Accordingly, while parties may seek injunctive relief 
from the court at that stage, as the Commission explained in Order No. 
871, the purpose of the rule is to preclude construction during the 
period the Commission may act on rehearing.\53\ As a result, we find 
that it is appropriate to generally refrain from issuing an 
authorization to proceed with construction until the Commission has 
completed its decisionmaking process.
---------------------------------------------------------------------------

    \52\ Allegheny, 964 F.3d at 17.
    \53\ If the Commission, in acting on rehearing of a section 3 or 
section 7(c) authorization order, changes the outcome of the 
underlying authorization order, such that further rehearing lies, 
the Commission would continue to apply Order No. 871 to preclude 
construction if a qualifying rehearing request is filed. See Smith 
Lake Improvement & Stakeholders Ass'n v. FERC, 809 F.3d 55, 56-57 
(D.C. Cir. 2015). However, if the Commission issues a substantive 
order on rehearing that does not change the outcome of the 
underlying authorization order, subsequent requests for rehearing or 
clarification of the previously issued rehearing order will not re-
trigger the provisions of Order No. 871 to further preclude the 
issuance of an authorization to proceed with construction. In those 
rare instances in which the Commission later determines that further 
procedural steps are necessary in a given case (see, e.g., Algonquin 
Gas Transmission, LLC, 174 FERC ] 61,126 (2021) (order establishing 
briefing)), the 90-day period following the date that a qualifying 
request for rehearing may be deemed denied by operation of law would 
not be altered or extended.
---------------------------------------------------------------------------

    26. However, upon consideration of the comments filed in response 
to Order No. 871-A, we believe it is appropriate to provide a date 
certain by which the prohibition on issuing an authorization to proceed 
with construction would terminate. In particular, we modify our prior 
order to provide that the rule's restriction on issuing construction 
authorizations will expire 90 days following the date that a request 
for rehearing may be deemed to have been denied if the request is still 
pending before the Commission. We believe that this strikes an 
appropriate balance that allows aggrieved parties time to access the 
courts while providing project developers with a predictable time 
period after which construction authorizations may be permitted in the 
event a rehearing request remains pending before the Commission.
    27. Fourth, as described by the Allegheny court, the Commission 
could ``grant rehearing for the express purpose of revisiting and 
substantively reconsidering a prior decision,'' where it ``needed 
additional time to allow for supplemental briefing or further hearing 
processes.'' \54\ Under those circumstances, i.e., where the Commission 
grants rehearing without issuing a final order, the original 
authorization would no longer be in effect and the provisions of Order 
No. 871 would no longer apply since there would be no final order 
pursuant to which a notice to proceed could be issued.
---------------------------------------------------------------------------

    \54\ 964 F.3d at 16.
---------------------------------------------------------------------------

    28. INGAA urges the Commission to set a deadline, not to exceed 60 
days from any order granting rehearing for further procedures, to issue 
a final order on the merits of the rehearing request.\55\ Because 
timelines associated with supplemental briefing or evidentiary 
submissions may vary based on the complexity of the issues warranting 
further procedures, we decline to do so and intend to continue to act 
on requests for rehearing as soon as possible.
---------------------------------------------------------------------------

    \55\ INGAA Rehearing Request at 4-5, 24-26 (providing a 
``predictable and transparent timetable would help project 
developers, their customers, and end-users of gas plan for 
construction timetables and avoid unnecessary costs and 
disruption''); see also INGAA Initial Brief at 10, 28. Some 
commenters advanced similar requests, and generally noted that 
setting a specific timeframe for action on requests for rehearing 
and/or requests for authorization to commence construction would be 
beneficial as it would provide regulatory certainty and 
transparency.
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    29. Finally, INGAA also asks that we revise Sec.  157.23 to 
expressly state that the Commission may waive the applicability of the 
rule for ``good cause shown.'' \56\ The Commission has broad authority 
to waive application of its own regulations and does not find it 
necessary to revise the rule to incorporate a ``good cause'' exception.
---------------------------------------------------------------------------

    \56\ INGAA Rehearing at 5, 25-26, and 34. This request was 
reiterated in some of the briefs filed by natural gas companies. 
See, e.g., Enbridge Initial Brief at 11-12; Enbridge Reply Brief at 
10.
---------------------------------------------------------------------------

    30. Consistent with the foregoing discussion, we revise 18 CFR 
157.23 to read as follows:

    With respect to orders issued pursuant to 15 U.S.C. 717b or 15 
U.S.C. 717f(c) authorizing the construction of new natural gas 
transportation, export, or import facilities, no authorization to 
proceed with construction activities will be issued:
    (a) until the time for the filing of a request for rehearing 
under 15 U.S.C. 717r(a) has expired with no such request being 
filed, or
    (b) if a timely request for rehearing raising issues reflecting 
opposition to project construction, operation, or need is filed, 
until: (i) The request is no longer pending before the Commission, 
(ii) the record of the proceeding is filed with the court of 
appeals, or (iii) 90 days has passed after the date that the request 
for rehearing may be deemed to have been denied under 15 U.S.C. 
717r(a).\57\
---------------------------------------------------------------------------

    \57\ The italicized text reflects the revisions to Sec.  157.23 
that we are adopting herein.
---------------------------------------------------------------------------

B. APA and NGA Requirements

1. APA Notice and Comment Requirement
    31. Section 553 of the Administrative Procedure Act (APA) generally 
requires federal agencies to publish in the Federal Register a notice 
of proposed rulemaking and to provide interested persons an opportunity 
to submit written comments on the proposed rule prior to issuing a 
final rule.\58\ However, these requirements, commonly referred to as 
the APA's notice and comment procedures, do not apply to 
``interpretative rules, general statements of policy, or rules of 
agency organization, procedure, or practice.'' \59\
---------------------------------------------------------------------------

    \58\ 5 U.S.C. 553.
    \59\ Id. 553(b)(3)(A).
---------------------------------------------------------------------------

    32. Kinder Morgan and INGAA, (the latter in the alternative to its 
request for clarification), argue that, by issuing a final rule without 
providing the public notice and opportunity to comment, the Commission 
violated section 553 of the

[[Page 26156]]

APA.\60\ Specifically, Kinder Morgan argues that the Commission erred 
by relying on the APA's exception to notice-and-comment rulemaking for 
``rules of agency organization, procedure, or practice'' to promulgate 
the rule because, it contends, the rule substantially affects the 
rights and interests of project proponents and their customers.\61\ 
INGAA advances a similar argument, stating that the changes adopted in 
Order No. 871 are not ``technical matters of procedure,'' but rather 
entail ``substantive alterations of substantial rights subject to the 
APA's notice-and-comment procedures.'' \62\
---------------------------------------------------------------------------

    \60\ Kinder Morgan Rehearing at 6-12; INGAA Rehearing at 27-32.
    \61\ Kinder Morgan Rehearing at 8.
    \62\ INGAA Rehearing at 28.
---------------------------------------------------------------------------

    33. Even if the rule appears procedural on its face, Kinder Morgan 
and INGAA argue, the rule's substantive effect on the natural gas 
pipeline industry is significant and ``sufficiently grave so that 
notice and comment are needed to safeguard the policies underlying the 
APA.'' \63\ In so positing, INGAA and Kinder Morgan note that of the 
1,000 certificates of public convenience and necessity issued by the 
Commission since 1999, parties sought rehearing in 240 cases 
(approximately 24 percent).\64\
---------------------------------------------------------------------------

    \63\ See Kinder Morgan Rehearing at 11-12 (quoting Mendoza v. 
Perez, 754 F.3d 1002, 1023 (D.C. Cir. 2014) (citations omitted)); 
INGAA Rehearing at 30-31 (same).
    \64\ Kinder Morgan Rehearing at 12; INGAA Rehearing at 31.
---------------------------------------------------------------------------

    34. Kinder Morgan and INGAA also contend that the Commission failed 
to consider the rule's impact on the natural gas pipeline industry's 
business models, which developed in reliance on the Commission's prior 
practice of authorizing construction prior to acting on applications 
for rehearing.\65\ INGAA stresses that the ``timing of approvals, 
construction initiation, and placement of projects into natural gas 
service are among a pipeline company's most important practical and 
commercial considerations.'' \66\ Kinder Morgan and INGAA argue that 
the Commission failed ``to assess whether there were reliance 
interests, determine whether they were significant, and weigh any such 
interests against competing policy concerns.'' \67\
---------------------------------------------------------------------------

    \65\ Kinder Morgan Rehearing at 10 (citing Dep't of Homeland 
Sec. v. Regents of the Univ. of Cal., 140 S. Ct. 1891, 1913-1915 
(2020) (in rescinding the Deferred Action for Childhood Arrivals 
program, the Department of Homeland Security should have assessed 
whether there were reliance interests, determined the significance 
of any such interests, and weighed those interests against competing 
policy concerns)); INGAA Rehearing at 32-34 (same).
    \66\ INGAA Rehearing at 33.
    \67\ Kinder Morgan Rehearing at 10 (quoting Regents of the Univ. 
of Cal., 140 S. Ct. at 1915); INGAA Rehearing at 34 (same).
---------------------------------------------------------------------------

2. Order No. 871 Was Properly Issued as a Final Rule
    35. Because the rule neither substantially ``alters the rights or 
interests'' of regulated natural gas companies nor changes the agency's 
substantive outcomes, the APA's notice and comment procedures were not 
required.\68\ Nothing in Order No. 871, as revised here, changes the 
standards the Commission applies, or the ultimate result, on rehearing 
of NGA section 7 certificate orders. Moreover, the timing of when to 
permit construction to begin is a matter entirely within the 
Commission's existing discretion and not a matter of right. Nothing in 
the NGA or the Commission's regulations, prior to Order No. 871, 
addresses the timing of authorizations to commence construction. And 
nothing in the NGA or the Commission's regulations prevents the 
Commission from acting on rehearing prior to issuing an authorization 
to proceed with construction. Staff, or the Commission itself, could 
validly have established the same policy, either generally or on a 
case-by-case adjudicatory basis, without any announcement at all. Given 
the absence of a right to obtain authorization to proceed with 
construction at any particular time, Kinder Morgan and INGAA have not 
demonstrated that Order No. 871 is anything more than a procedural 
rule. In addition, an otherwise procedural rule, such as this, ``does 
not becomes a substantive one, for notice-and-comment purposes, simply 
because it imposes a burden on regulated parties.'' \69\
---------------------------------------------------------------------------

    \68\ See Am. Hosp. Ass'n v. Bowen, 834 F.2d 1037, 1047 (D.C. 
Cir. 1987) (quoting Batterton v. Marshall, 648 F.2d 694, 707 (D.C. 
Cir. 1980)); id. at 1048. ``In determining whether a rule is 
substantive, we must look at its effect on those interests 
ultimately at stake in the agency proceeding.'' Neighborhood TV Co. 
v. FCC, 742 F.2d 629, 637 (D.C. Cir. 1984) (holding that a decision 
to freeze applications for television licenses on some frequencies 
affected an applicant's interest ``only incidentally'' and was 
therefore procedural) (citing Pickus v. U.S. Board of Parole, 507 
F.2d 1107 (D.C. Cir. 1974) (holding that parole board guidelines 
were substantive because they ``were the kind calculated to have a 
substantial effect on the ultimate parole decisions'')).
    \69\ James V. Hurson Assocs., Inc. v. Glickman, 229 F.3d 277, 
281 (D.C. Cir. 2000) (``Appellant has cited no case in which this 
Court has required notice-and-comment rulemaking for an especially 
burdensome procedural rule. Nor could it . . . .'').
---------------------------------------------------------------------------

    36. Neither Kinder Morgan nor INGAA sets forth with any specificity 
the significant and ``sufficiently grave'' impacts they contend will 
befall the natural gas pipeline industry as a result of Order No. 871. 
They merely note that of the over 1,000 certificates of public 
convenience and necessity issued since 1999, parties sought rehearing 
24 percent of the time. But both entities fail to mention that the 
timing of an initial Commission decision on a project proposed under 
NGA sections 7 or 3 has always been undefined. While a project 
proponent may identify in its application a requested approval and/or 
in-service date, these dates are requests that do not control the 
timing of the Commission's decision. Rather, the Commission's timeline 
for processing project applications is dictated by factors such as the 
complexity of proposed projects, the quality of information provided by 
the applicant and the applicant's timeliness in responding to staff 
information requests, changes made by the applicant to its proposal, 
and the nature of the issues in each case. Neither the public nor the 
project proponent is privy to the date on which the Commission may act 
on a project application filed under NGA section 3 or 7. This means 
that, even prior to Order No. 871, project development timelines had to 
account for some uncertainty in when the Commission might issue its 
decision on an NGA section 7 or 3 application and, if appropriate, 
subsequently authorize commencement of construction. Any incremental 
delay or uncertainty created by Order No. 871 is acceptable given the 
benefits that the rule provides.
    37. Further, in many, if not most, instances, construction cannot 
begin immediately upon issuance of an initial order under NGA sections 
3 or 7. Typically, construction of natural gas facilities cannot 
commence without the certificate or authorization holder first filing 
documentation demonstrating either that it has received all applicable 
authorizations required under federal law or that such authorizations 
have been waived. Often this involves finalizing the pipeline route, 
completing Endangered Species Act or National Historic Preservation Act 
consultation, and/or obtaining state certifications under the Clean 
Water Act or the Coastal Zone Management Act. Based on data maintained 
by Commission staff for the five calendar years preceding Order No. 871 
(i.e., 2015-2019), an average of 85 days elapsed between issuance of an 
initial order and issuance of an authorization to proceed with 
construction. Put another way, prior to Order No. 871, on average, 
natural gas companies should not have expected to receive authorization 
to proceed with

[[Page 26157]]

construction sooner than three months after order issuance.
    38. For the reasons discussed above, there has been no showing that 
Order No. 871 will substantially impact the natural gas industry. 
Similarly, Kinder Morgan and INGAA have not established that the 
natural gas industry had a legitimate reliance interest in prior 
instances where Commission staff issued authorizations to proceed with 
construction while requests for rehearing were pending. Though the 
natural gas industry may have relied on past Commission practice, any 
such reliance does not establish a legal right to Commission action on 
a particular timetable, especially where the relevant Commission 
process was not established by regulation, policy statement, or spelled 
out in any detail in case law.
    39. In any event, even assuming the Commission was required to 
solicit comments on the new rule, the Commission has fully satisfied 
this requirement by soliciting further briefing on rehearing in this 
proceeding, including the opportunity for both initial and reply 
briefs.\70\ Moreover, in light of the Commission's announced goal of 
acting on landowners' rehearing requests within 30 days,\71\ the 
significantly increased speed with which the Commission resolves 
rehearing requests following the recent Allegheny decision, and the 
tailoring of the rule to apply only where a rehearing request reflects 
opposition to a project, we do not anticipate that the rule will impose 
any significant burden on the natural gas industry.
---------------------------------------------------------------------------

    \70\ In this regard, we note that the industry commenters have 
not identified an instance of delay resulting from application of 
Order No. 871.
    \71\ In January 2020, the Commission formally reorganized the 
rehearings group within the Office of General Counsel, adding a 
landowner group that gives first priority to landowner rehearing 
requests of NGA section 7 certificate orders, with the aim of 
resolving such requests within 30 days.
---------------------------------------------------------------------------

3. NGA Section 19(c) Stay Provision
    40. Section 19(c) of the NGA states, in relevant part, that ``[t]he 
filing of an application for rehearing . . . shall not, unless 
specifically ordered by the Commission, operate as a stay of the 
Commission's order.'' \72\ Kinder Morgan asserts that the Commission 
violated section 19(c) by broadly staying construction pending 
rehearing without a specific finding that a stay is warranted.\73\ 
Order No. 871, Kinder Morgan contends, issued a ``blanket stay of 
construction of all projects authorized under [NGA] Sections 3 and 7, 
pending rehearing, regardless of whether any party requests or 
demonstrates a stay is required.'' \74\ This outcome, Kinder Morgan 
claims, is inconsistent with case law that explains Congress intended 
to allow construction to proceed while an application for rehearing is 
pending.\75\
---------------------------------------------------------------------------

    \72\ 15 U.S.C. 717r(c).
    \73\ Kinder Morgan Rehearing at 13-15.
    \74\ Id. at 14.
    \75\ Kinder Morgan Rehearing at 15 (citing Berkley v. Mountain 
Valley Pipeline, LLC, 896 F.3d 624, 631 (4th Cir. 2018) (Berkley), 
cert. denied sub nom. Berkley v. FERC, 139 S. Ct. 941 (2019)).
---------------------------------------------------------------------------

    41. The case law Kinder Morgan offers to support its claim that 
Order No. 871 is inconsistent with Congress's intent when enacting NGA 
section 19(c) is unavailing. In affirming the district court's 
dismissal for lack of subject matter jurisdiction of a complaint 
challenging the constitutionality of various NGA provisions in 
Berkley,\76\ the U.S. Court of Appeals for the Fourth Circuit stated 
that ``Congress contemplated construction would be allowed to continue 
while FERC reviews a petition for rehearing.'' This statement without 
more does nothing to counter the fact that it is entirely within the 
Commission's discretion to decide whether, when, and how to allow 
construction of projects authorized under NGA sections 3 and 7 to 
proceed. The Commission can require compliance with conditions in its 
orders before allowing construction to begin.\77\ And, as noted above, 
section 19(c) on its face contemplates the Commission's issuance of 
stays of its orders.\78\
---------------------------------------------------------------------------

    \76\ 896 F.3d at 631.
    \77\ The Commission has broad authority to condition 
certificates for interstate pipelines on ``such reasonable terms and 
conditions as the public convenience and necessity may require.'' 15 
U.S.C. 717f(e); see also, e.g., ANR Pipeline Co. v. FERC, 876 F.2d 
124, 129 (D.C. Cir. 1989) (noting the Commission's ``extremely 
broad'' conditioning authority).
    \78\ Even if Order No. 871 were construed to be a blanket stay, 
such an action would be supported by the Commission's articulated 
desire to balance its commitment to expeditiously responding to 
parties' concerns in comprehensive orders on rehearing and the 
serious concerns posed by the possibility of construction proceeding 
prior to the completion of agency review.
---------------------------------------------------------------------------

    42. Kinder Morgan misconstrues the effect of the Commission's 
pronouncement in Order No. 871. As we explained above, even prior to 
the rule's enactment, it is rarely the case that construction can begin 
immediately upon issuance of an order authorizing new natural gas 
facilities under NGA section 3 or 7.\79\ The authorization or 
certificate holder must first file documentation demonstrating that it 
has received all applicable authorizations required under federal law 
or that such authorizations have been waived, and that it has satisfied 
all preconstruction requirements. Accordingly, we do not anticipate the 
time period during which authorization to begin construction may not be 
permitted--i.e., during 30-day rehearing period and, if a qualifying 
rehearing request is filed, until that request is no longer pending 
before the Commission, the record of the proceeding is filed with the 
court of appeals, or 90 days has elapsed since the rehearing request 
was deemed denied by operation of law--to be unduly long or a 
significant departure from the Commission's prior practice.
---------------------------------------------------------------------------

    \79\ See supra P 37.
---------------------------------------------------------------------------

C. Commission Policy on Exercise of Eminent Domain Pending Rehearing

    43. In Order No. 871-A, in addition to the issues raised on 
rehearing, we also sought comment on whether, and if so, how, the 
Commission should modify its practices or procedures to address 
concerns regarding the exercise of eminent domain while rehearing 
requests are pending before the Commission.\80\ As further discussed 
below, in light of the balance of interests at stake, we will adopt a 
policy of presumptively staying an NGA section 7(c) certificate order 
during the 30-day period for seeking rehearing, and pending Commission 
resolution of any timely requests for rehearing filed by a landowner, 
until the earlier of the date on which the Commission (1) issues a 
substantive order on rehearing or otherwise indicates that the 
Commission will not take further action, or (2) 90 days following the 
date that a request for rehearing may be deemed to have been denied 
under NGA section 19(a). This policy will not apply where the pipeline 
developer has already, at the time of the certificate order, acquired 
all necessary property interests or where no landowner protested the 
section 7 application. In addition, where no landowner files a timely 
request for rehearing of the certificate order, the stay will 
automatically lift following the close of the 30-day period for seeking 
rehearing.
---------------------------------------------------------------------------

    \80\ Order No. 871-A, 174 FERC ] 61,050 at P 7.
---------------------------------------------------------------------------

    44. As explained in Order No. 871,\81\ when the Commission grants a 
certificate of public convenience and necessity, NGA section 7(h) 
authorizes the certificate holder to exercise eminent domain authority 
if it ``cannot acquire by contract, or is unable to agree with the 
owner of property to the compensation to be paid for, the necessary 
right-of-way to construct, operate, and maintain'' the authorized 
facilities.\82\ This statutory framework

[[Page 26158]]

permits pipeline developers, absent a Commission- or court-ordered 
stay, to start the process of condemning an individual's land before 
the Commission completes the certificate proceeding, including 
consideration of the merits of any timely filed requests for 
rehearing.\83\ While natural gas industry commenters note that 
developers make efforts to avoid the use of eminent domain,\84\ 
landowners describe ``having to face the trauma, expense, and permanent 
consequences of condemnation suits that begin on the heels of a 
Commission Certificate Order.'' \85\
---------------------------------------------------------------------------

    \81\ Order No. 871, 171 FERC ] 61,201 at P 4.
    \82\ 15 U.S.C. 717f(h). The NGA specifies that any such 
condemnation proceedings shall take place in the federal court for 
the district in which the property is located or in the relevant 
state court.
    \83\ See Allegheny Def. Project v. FERC, 932 F.3d 940, 948, 950, 
952-53, 956 (D.C. Cir. 2019) (Millett, J., concurring) (detailing 
the harm to landowners' constitutionally protected property interest 
in their homes as ``a private interest of historic and continuing 
importance'') (quoting United States v. James Daniel Good Real 
Property, 510 U.S. 43, 53-54 (1993)).
    \84\ INGAA Initial Brief at 22.
    \85\ Niskanen Center Reply Brief at 10, 16 (noting a 2017 press 
report of 300 condemnation actions commenced in Virginia by the 
developers of the Mountain Valley Pipeline) (citing The Roanoke 
Times, Mountain Valley sues landowners to gain pipeline easements, 
(Oct. 27, 2017), https://roanoke.com/business/news/mountain-valley-sues-landowners-to-gain-pipeline-easements-through-eminent/article_abff5d87-1aee-5a50-b3c2-b3ee0c812e44.html); see also id. at 
9 (stating that the burden on landowners from allowing eminent 
domain proceedings to commence upon issuance of a certificate 
continues after Allegheny); Landowners Initial Brief at 1-3, 5 
(explaining that the commenters had faced three different iterations 
of a proposed projects over 15 years in Oregon, and urging the 
Commission to disallow the use of eminent domain pending Commission 
certificate proceedings, including on rehearing).
---------------------------------------------------------------------------

    45. The courts, however, have held that the issuance of a valid 
certificate is all that is required from the Commission for a pipeline 
developer to begin eminent domain proceedings when it cannot otherwise 
acquire the property covered by the certificate.\86\ In other words, 
the Commission lacks the authority to deny or restrict the power of 
eminent domain in a section 7 certificate.\87\ Nor does the Commission 
have the authority to oversee the acquisition of property rights 
through eminent domain, including issues regarding the timing of and 
just compensation for the acquisition of property rights,\88\ which are 
matters reserved for the courts.\89\
---------------------------------------------------------------------------

    \86\ Twp. of Bordentown, N.J. v. FERC, 903 F.3d 234, 265 (3d 
Cir. 2018) (stating that NGA section 7(h) ``contains no condition 
precedent'' to the right of eminent domain other than issuance of 
the certificate when a certificate holder is unable to acquire a 
right-of-way by contract); Berkley, 896 F.3d at 628 (``Issuing such 
a Certificate conveys and automatically transfers the power of 
eminent domain to the Certificate holder . . . . Thus, FERC does not 
have discretion to withhold eminent domain once it grants a 
Certificate.'' (citation omitted)).
    \87\ See Midcoast Interstate Transmission, Inc. v. FERC, 198 
F.3d 960, 973 (D.C. Cir. 2000) (``The Commission does not have the 
discretion to deny a certificate holder the power of eminent 
domain.'' (citation omitted)).
    \88\ PennEast Pipeline Co., LLC, 174 FERC ] 61,056, at P 10 
(2021).
    \89\ Id. (citing Atl. Coast Pipeline, LLC, 164 FERC ] 61,100, at 
P 88 (2018); Mountain Valley Pipeline, LLC, 163 FERC ] 61,197, at P 
76 (2018); PennEast Pipeline Co., LLC, 164 FERC ] 61,098 at P 33 
n.82 (2018)).
---------------------------------------------------------------------------

    46. On the other hand, the Commission unquestionably may determine 
the effective date of \90\ and stay its own orders,\91\ and courts have 
specifically contemplated that a stay would be operative to withhold 
the eminent domain authority otherwise afforded by NGA section 
7(h).\92\ The Commission also has the ``power to . . . issue . . . such 
orders . . . as it may find necessary or appropriate to carry out the 
provisions of this Act.'' \93\ Accordingly, in light of the balance of 
interests identified in the record, the Commission will, in future 
proceedings,\94\ adopt a policy of presumptively staying an NGA section 
7(c) certificate order \95\ during the 30-day rehearing period and 
pending Commission resolution of any timely requests for rehearing 
filed by landowners, up until 90 days following the date that a request 
for rehearing may be deemed to have been denied under NGA section 
19(a). We think 90 days is appropriate because it balances the 
competing interests at stake including the project developer's interest 
in proceeding with construction when it has obtained all necessary 
permits, and a project opponent's interest in being able to challenge 
the Commission's ultimate decision before irreparable harm may occur. 
This policy will not apply where the pipeline developer has already, at 
the time of the certificate order, acquired all necessary property 
interests or where no landowner protested the section 7 application. In 
addition, where no landowner files a timely request for rehearing of 
the certificate order, the stay will automatically lift following the 
close of the 30-day period for seeking rehearing. This new policy is 
intended to indicate our belief that, as Judge Griffith put it in his 
concurrence in Allegheny, during the rehearing period ``a district 
court . . . should not plow ahead'' with condemnation, instead 
``holding an eminent-domain action in abeyance until the Commission 
completes its reconsideration of the underlying certificate order.'' 
\96\
---------------------------------------------------------------------------

    \90\ See 15 U.S.C. 717o (``Orders of the Commission shall be 
effective on the date and in the manner which the Commission shall 
prescribe.'').
    \91\ Under the APA, an agency may issue a stay of its order 
where the ``agency finds that justice so requires.'' 5 U.S.C. 705. 
In determining whether this standard has been met, we consider 
several factors, including: (1) Whether a stay is necessary to 
prevent irreparable injury; (2) whether issuing a stay may 
substantially harm other parties; and (3) whether a stay is in the 
public interest. See, e.g., Millennium Pipeline Co., LLC, 141 FERC ] 
61,022, at P 13 (2012); Ruby Pipeline, LLC, 134 FERC ] 61,103, at P 
17 (2011).
    \92\ See, e.g., Allegheny, 964 F.3d at 8 (citing Transcon. Gas 
Pipe Line Co. v. Permanent Easements for 2.14 Acres, 907 F.3d 725, 
740 (3d Cir. 2018) (affirming district court action allowing 
condemnation action to proceed absent a Commission-ordered stay)); 
see also Mountain Valley Pipeline, LLC v. An Easement to Construct, 
Operate & Maintain a 42-inch Gas Transmission Line, No. 2:17-CV-
04214, 2018 WL 1004745, at *5 (S.D.W. Va. Feb. 21, 2018) (``The 
landowners insist that the various challenges that Mountain Valley 
faces before FERC and the courts of appeals counsel against the 
granting of partial summary judgment. As explained earlier, a FERC 
order remains in effect unless FERC or a court of appeals issues a 
stay and no such stay has been issued here.'' (internal citations 
omitted)); In re Algonquin Nat. Gas Pipeline Eminent Domain Cases, 
No. 15-CV-5076, 2015 WL 10793423, at *7 (S.D.N.Y. Sept. 18, 2015) 
(``Here, various interested parties have filed Requests for 
Rehearing with FERC but, absent a stay by FERC, those Requests for 
Rehearing neither prohibit these proceedings from going forward nor 
affect Algonquin's substantive right to condemn or the need for 
immediate possession.''); Tenn. Gas Pipeline Co. v. 104 Acres of 
Land More or Less, in Providence Cty. of State of R.I., 749 F. Supp. 
427, 431 (D.R.I. 1990) (``Because in this case the Commission's 
order has not been stayed, condemnation pursuant to that order may 
proceed.'').
    \93\ 15 U.S.C. 717o.
    \94\ Specifically, in NGA section 7(c) certificate orders issued 
after the effective date of this order.
    \95\ Unlike section 7 of the NGA, section 3 does not convey 
eminent domain authority, see Order No. 871, 171 FERC ] 61,201 at P 
5, and, therefore, section 3 authorizations will not be subject to 
this policy.
    \96\ Allegheny, 964 F.3d at 22 (Griffith, J., concurring); see 
also id. (noting Judge Katsas's suggestion ``that once the 
Commission grants rehearing of a certificate order, that order 
should be regarded as nonfinal . . . and a nonfinal order is 
presumably an invalid basis for transferring property by eminent 
domain'' and suggesting ``[t]hat suggestion merits a closer look'') 
(citations omitted).
---------------------------------------------------------------------------

    47. Given the grave consequences that eminent domain has for 
landowners, we believe that it is fundamentally unfair for a pipeline 
developer to use a section 7 certificate to begin the exercise of 
eminent domain before the Commission has completed its review of the 
underlying certificate order, through consideration of the merits of 
any timely filed requests for rehearing, either by issuance of an order 
on rehearing or a notice indicating that the Commission will not take 
further action. As the en banc D.C. Circuit recognized in Allegheny, 
reforming the Commission's rehearing practice--alone--does not prevent 
the harm to landowners that can arise when developers initiating 
eminent domain proceedings upon issuance of a certificate order, 
without awaiting the completion of the

[[Page 26159]]

Commission's certificate proceeding.\97\ There is no question that 
eminent domain is among the most significant actions that a government 
may take with regard to an individual's private property.\98\ And the 
harm to an individual from having their land condemned is one that may 
never be fully remedied, even in the event they receive their 
constitutionally-required compensation.\99\
---------------------------------------------------------------------------

    \97\ Allegheny, 964 F.3d at 10 n.2; see also id. at 22 
(Griffith, J., concurring) (``Those proceedings are the final piece 
of the puzzle.''); Niskanen Center Initial Brief at 8-11 (describing 
the burden on landowners from eminent domain as continuing after 
Allegheny).
    \98\ Dolan v. City of Tigard, 512 U.S. 374, 384 (1994) 
(observing that government action that provides for ``public access 
[to private property] would deprive [the owner] of the right to 
exclude others, `one of the most essential sticks in the bundle of 
rights that are commonly characterized as property.' '') (quoting 
Kaiser Aetna v. United States, 444 U.S. 164, 176 (1979)); Loretto v. 
Teleprompter Manhattan CATV Corp., 458 U.S. 419, 426 (1982) (``[W]e 
have long considered a physical intrusion by government to be a 
property restriction of an unusually serious character for purposes 
of the Takings Clause.''); Hendler v. United States, 952 F.2d 1364, 
1374 (Fed. Cir. 1991) (``In the bundle of rights we call property, 
one of the most valued is the right to sole and exclusive 
possession--the right to exclude strangers, or for that matter 
friends, but especially the Government.'' (emphasis in the 
original)).
    \99\ See United Church of the Med. Ctr. v. Med. Ctr. Comm'n, 689 
F.2d 693, 701 (7th Cir. 1982) (``It is settled beyond the need for 
citation . . . that a given piece of property is considered to be 
unique, and its loss is always an irreparable injury.'').
---------------------------------------------------------------------------

    48. Nevertheless, many, if not all, of the briefs filed by 
representatives of the natural gas industry were strongly opposed to 
the Commission's consideration of changes in policy or practice 
regarding a pipeline developer's exercise of eminent domain, including 
the general policy we adopt today. They described a range of 
consequences that would flow from such a decision, such as delayed 
project timelines, increased regulatory uncertainty, interference with 
the orderly development of natural gas, higher likelihood of project 
terminations, and purported environmental harm caused by producers 
flaring extra gas.\100\
---------------------------------------------------------------------------

    \100\ See, e.g., INGAA Initial Brief at 18-27; Kinder Morgan 
Initial Brief at 7-9; Tallgrass Initial Brief at 9; see also 
Enbridge Reply Brief at 19; INGAA Reply Brief at 17.
---------------------------------------------------------------------------

    49. We have thoroughly reviewed those comments and we recognize the 
industry's concerns. We believe this order appropriately balances those 
concerns with the benefits that come from addressing the significant 
fairness and due process concerns that arise when a pipeline developer 
can begin the process of condemning private land before the Commission 
has completed its certificate proceeding, and the owners of that land 
can go to court to challenge the Commission's ultimate decision, 
following rehearing, regarding the certificate that is the basis for 
that condemnation action.\101\ Further, as described above, the 
presumptive stay reflects important limits designed to balance the 
interests of developers and landowners in light of the Commission's 
finding, in any given certificate order, that the proposed project is 
consistent with the public interest. At most, any stay will last no 
longer than approximately 150 days following the issuance of a 
certificate order.\102\ Moreover, a pipeline developer may avoid a stay 
entirely by obtaining all necessary property interests prior to 
issuance of the certificate, a stay will only extend beyond the initial 
30-day period for seeking rehearing where a landowner files a request 
for rehearing of the certificate order, and during the period in which 
a stay is in place and as permitted consistent with the stay of the 
certificate, the project developer can continue to engage in 
development related activities that do not require use of landowner 
property or that are voluntarily agreed to by the landowner.
---------------------------------------------------------------------------

    \101\ Contrary to the dissent's arguments, we recognize that 
this new policy is a departure from our past practice. But the 
dissent errs in suggesting that this departure is unexplained. 
Limiting Authorization to Proceed with Construction Activities 
Pending Rehearing, 175 FERC ] 61,098 (2021) (Danly, Comm'r, 
dissenting at P 12) (Order No. 871-B). As discussed throughout 
today's order, including in the text accompanying this footnote, we 
believe that this new policy better balances the relevant 
considerations--such as fairness, due process, and developer 
certainty--thereby justifying the change in policy. See FCC v. Fox 
Television Stations, Inc., 556 U.S. 502, 515 (2009) (``[O]f course 
the agency must show that there are good reasons for the new policy. 
But it need not demonstrate to a court's satisfaction that the 
reasons for the new policy are better than the reasons for the old 
one; it suffices that the new policy is permissible under the 
statute, that there are good reasons for it, and that the agency 
believes it to be better, which the conscious change of course 
adequately indicates.'').
    \102\ Approximately 150 days is the sum of the initial 30-day 
period for seeking rehearing, the next 30-day period before 
rehearing may be deemed denied by operation of law, and a final 90-
day period, following the deemed denial.
---------------------------------------------------------------------------

    50. In addition, as noted above, particularly post-Allegheny, the 
Commission has significantly increased the speed with which it resolves 
rehearing requests, whether by addressing the merits of rehearing 
requests as expeditiously as possible or by issuing a notice within 30 
days providing that rehearing may be deemed denied by operation of law, 
without also indicating the Commission's intent to take further action. 
We believe that the Commission's post-Allegheny practice should 
significantly reduce any burden on pipeline developers. In any case, we 
find that any burden imposed on pipeline developers by this new policy 
will be relatively minor and ultimately outweighed by the significant 
benefits it affords to landowners.
    51. Finally, we reiterate that this new policy is only presumptive 
and that the question of whether to impose a stay will be decided on 
the circumstances presented in each particular certificate 
proceeding.\103\ A pipeline developer may move to preclude, or lift, a 
stay based on a showing of significant hardship,\104\ and the 
Commission may, in its discretion, grant such a motion upon finding 
that it is necessary or appropriate to commence condemnation 
proceedings prior to Commission action on rehearing or the date that is 
90 days following the date that a request for rehearing may be deemed 
to have been denied under NGA section 19(a). Although, as noted, we 
will evaluate any motion on the specific facts and circumstances 
presented therein, we note that a commitment by the pipeline developer 
not to begin eminent domain proceedings until the Commission issues a 
final order on any landowner rehearing requests will weigh in favor of 
granting such a motion.
---------------------------------------------------------------------------

    \103\ Contrary to the dissent's arguments, Order No. 871-B, 175 
FERC ] 61,098 (Danly, Comm'r, dissenting at PP 6-12), we are 
announcing only a general policy with respect to stays. We will make 
a particularized application of that policy in individual 
certificate orders, applying the criteria for granting a stay on a 
case-by-case basis. Parties to those individual proceedings will 
have the opportunity to challenge the Commission's determination on 
whether to issue a stay in those proceedings.
    \104\ See, e.g., INGAA Initial Brief at 20-21 (noting that 
state-law mechanisms allowing pipeline developers to obtain physical 
access to the pipeline route to conduct environmental and other 
information gathering surveys, often necessary for other federal and 
state permits, vary from state to state, with some states 
authorizing physical access ``only by a party that otherwise has the 
power of eminent domain'').
---------------------------------------------------------------------------

III. Regulatory Requirements

A. Information Collection Statement

    52. The Paperwork Reduction Act \105\ requires each federal agency 
to seek and obtain the Office of Management and Budget's (OMB) approval 
before undertaking a collection of information (i.e., reporting, 
recordkeeping, or public disclosure requirements) directed to ten or 
more persons or contained in a rule of general applicability. OMB 
regulations require approval of certain information collection 
requirements contained in final rules published in the Federal 
Register.\106\ The rule promulgated by Order No. 871, and revised 
herein, does not contain any

[[Page 26160]]

information collection requirements. The Commission is therefore not 
required to submit to OMB for review this order addressing arguments 
raised on rehearing and clarification, and setting aside, in part, 
prior order.
---------------------------------------------------------------------------

    \105\ 44 U.S.C. 3501-3521.
    \106\ See 5 CFR pt. 1320.
---------------------------------------------------------------------------

B. Environmental Analysis

    53. The Commission is required to prepare an Environmental 
Assessment or an Environmental Impact Statement for any action that may 
have a significant effect on the human environment.\107\ The Commission 
has categorically excluded certain actions from this requirement as not 
having a significant effect on the human environment, including the 
promulgation of rules that are clarifying, corrective, or procedural, 
or that do not substantially change the effect of legislation or the 
regulations being amended.\108\ Because the rule promulgated by Order 
No. 871, and revised herein, is procedural in nature, preparation of an 
Environmental Assessment or an Environmental Impact Statement is not 
required.
---------------------------------------------------------------------------

    \107\ Regulations Implementing the National Environmental Policy 
Act of 1969, Order No. 486, 52 FR 47897, 41 FERC ] 61,284 (1987).
    \108\ 18 CFR 380.4(a)(2)(ii).
---------------------------------------------------------------------------

C. Regulatory Flexibility Act

    54. The Regulatory Flexibility Act of 1980 (RFA) \109\ generally 
requires a description and analysis of rules that will have significant 
economic impact on a substantial number of small entities. The 
Commission determined that Order No. 871 was exempt from the 
requirements of the RFA.\110\ This order addressing arguments raised on 
rehearing and clarification, and setting aside, in part, prior order 
does not disturb the Commission's finding.
---------------------------------------------------------------------------

    \109\ 5 U.S.C. 601-612.
    \110\ Order No. 871, 171 FERC ] 61,201 at P 16.
---------------------------------------------------------------------------

D. Document Availability

    55. In addition to publishing the full text of this document in the 
Federal Register, the Commission provides all interested persons an 
opportunity to view and/or print the contents of this document via the 
internet through the Commission's Home Page (http://www.ferc.gov). At 
this time, the Commission has suspended access to the Commission's 
Public Reference Room due to the President's March 13, 2020 
proclamation declaring a National Emergency concerning the Novel 
Coronavirus Disease (COVID-19).
    56. From the Commission's Home Page on the internet, this 
information is available on eLibrary. The full text of this document is 
available on eLibrary in PDF and Microsoft Word format for viewing, 
printing, and/or downloading. To access this document in eLibrary, type 
the docket number excluding the last three digits in the docket number 
field.
    57. User assistance is available for eLibrary and the Commission's 
website during normal business hours from FERC Online Support at (202) 
502-6652 (toll free at 1-866-208-3676) or email at 
ferconlinesupport@ferc.gov, or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. Email the Public Reference Room at 
public.referenceroom@ferc.gov.

E. Effective Date

    58. This rule addressing arguments raised on rehearing and 
clarification, and setting aside, in part, prior order is effective 
June 14, 2021.

List of Subjects in 18 CFR Part 157

    Administrative practice and procedure, Natural gas, Reporting and 
recordkeeping requirements.

    By the Commission.
    Commissioner Chatterjee is not participating.
    Commissioner Danly is dissenting with a separate statement 
attached.
    Commissioner Christie is concurring with a separate statement 
attached.

    Issued: May 4, 2021.
Kimberly D. Bose,
Secretary.
    In consideration of the foregoing, the Commission is amending part 
157, chapter I, title 18, Code of Federal Regulations, as follows:

PART 157--APPLICATIONS FOR CERTIFICATES OF PUBLIC CONVENIENCE AND 
NECESSITY AND FOR ORDERS PERMITTING AND APPROVING ABANDONMENT UNDER 
SECTION 7 OF THE NATURAL GAS ACT

0
1. The authority citation for Part 157 continues to read as follows:

    Authority: 15 U.S.C. 717-717w, 3301-3432; 42 U.S.C. 7101-7352.


0
2. Amend Sec.  157.23 by revising paragraph (b) to read as follows:


Sec.  157.23   Authorizations to Proceed with Construction Activities.

* * * * *
    (b) If a timely request for rehearing raising issues reflecting 
opposition to project construction, operation, or need is filed, until:
    (1) The request is no longer pending before the Commission;
    (2) The record of the proceeding is filed with the court of 
appeals; or
    (3) 90 days has passed after the date that the request for 
rehearing may be deemed to have been denied under 15 U.S.C. 717r(a).

The Following Will Not Appear in the Code of Federal Regulations

Department of Energy

Federal Energy Regulatory Commission

Limiting Authorizations To Proceed With Construction Activities Pending 
Rehearing

DANLY, Commissioner, dissenting:

    1. I dissent in full from today's order modifying and expanding 
Order No. 871.\1\ As an initial matter, I write to state that I would 
grant rehearing on all matters and repeal the rule.
---------------------------------------------------------------------------

    \1\ See Limiting Authorizations to Proceed with Construction 
Activities Pending Rehearing, Order No. 871, 85 FR 40,113 (July 6, 
2020), 171 FERC ] 61,201 (2020) (Order No. 871).
---------------------------------------------------------------------------

    2. The Commission promulgated Order No. 871 on June 9, 2020, in 
advance of the decision in Allegheny Defense Project v. FERC,\2\ the en 
banc proceeding before the U.S Court of Appeals for the District of 
Columbia Circuit (D.C. Circuit) that addressed longstanding objections 
to the Commission's practice of relying upon tolling orders to delay 
answering requests for rehearing.\3\ In recognition of the injustice of 
the Commission's practice of tolling rehearing requests indefinitely, 
and that practice's consequent denial of an opportunity for litigants 
to perfect their appeals, the Commission issued Order No. 871 in an 
attempt to balance the interests of potential appellants with those of 
pipelines by delaying the issuance of notices to proceed with 
construction.\4\ On June 30, 2020, the D.C. Circuit issued its en banc 
opinion in Allegheny in which it found that the Commission was 
prohibited from indefinitely tolling requests for rehearing and finding 
that parties were entitled to petition for review once a rehearing 
request had been denied by operation of law.\5\ The D.C. Circuit, 
having rightly imposed the discipline the Commission was unwilling or 
unable to impose upon itself, obviated the pressing need animating the 
Commission's decision to delay the issuance of notices to proceed. In 
light of the D.C. Circuit's re-enforcement of the statutory scheme 
governing rehearing and appeal, the

[[Page 26161]]

Commission today need not go any further than has the court. Nor do I 
see any real risk that a pipeline will commence construction before a 
party has the opportunity to petition for review. As the Commission 
itself states, ``on average, natural gas companies should not have 
expected to receive authorization to proceed with construction sooner 
than three months after order issuance.'' \6\ Accordingly, I see no 
reason why this rule--promulgated in the face of litigation and in 
light of legitimate, unresolved concerns for the competing rights of 
the parties before the Commission--is still required by law or 
prudence. I would repeal it in full and instead rely wholly upon the 
rehearing and appeal provisions ordained by Congress to balance our 
litigants' various interests.
---------------------------------------------------------------------------

    \2\ 964 F.3d 1 (D.C. Cir. 2020) (en banc) (Allegheny).
    \3\ See Order No. 871, 171 FERC ] 61,201 (Glick, Comm'r, 
concurring in part and dissenting in part at P 1) (``It is readily 
apparent that today's final rule attempts to address some of the 
concerns raised in the Allegheny Defense Project v. FERC proceeding 
before the U.S. Court of Appeals for the District of Columbia 
Circuit (D.C. Circuit).'').
    \4\ See id. P 11.
    \5\ See Allegheny, 964 F.3d at 18-19.
    \6\ Limiting Authorization to Proceed with Construction 
Activities Pending Rehearing, 175 FERC ] 61,098, at P 37 (2021) 
(Order No. 871-B).
---------------------------------------------------------------------------

    3. I also write separately in order to highlight a handful of self-
evident legal infirmities that might form the basis of an aggrieved 
party's appeal. With this order, the Commission has, for the third time 
in as many months, dramatically increased the uncertainty faced by the 
natural gas industry by changing its policies so as to make it harder 
to rationally deploy capital, accurately assess risk, or predict 
Commission action.\7\ Worse yet, the Commission fails in this order to 
satisfy its obligations under the Administrative Procedure Act (APA) 
and implements policies that conflict with the plain text of the 
Natural Gas Act (NGA), the most obvious of which is our new, 
unnecessary, and unjustifiable presumption to stay certificate orders.
---------------------------------------------------------------------------

    \7\ See N. Nat. Gas Co., 174 FERC ] 61,189 (2021) (Danly, 
Comm'r, dissenting at P 2) (Northern); Algonquin Gas Transmission, 
LLC, 174 FERC ] 61,126 (2021) (Danly, Comm'r, dissenting at P 32) 
(Algonquin).
---------------------------------------------------------------------------

I. The Commission Fails To Respond to Arguments Raised in Briefing

    4. Turning first to the most basic of APA violations, the 
Commission declines to even acknowledge, let alone respond to, the 
arguments raised by the Interstate Natural Gas Association of America 
(INGAA) that the issuance of Order No. 871-A was improper.\8\ INGAA 
argues:
---------------------------------------------------------------------------

    \8\ See, e.g., INGAA February 16, 2021 Initial Brief at 7-8.

    (1) Order No. 871 was promulgated in violation of the notice-
and-comment requirements of the Administrative Procedure Act, and 
that procedural deficiency cannot be cured by Order No. 871-A or 
other after-the-fact processes; (2) Order No. 871-A appears to 
invite comments on issues that were not raised in Order No. 871 or 
in the requests for rehearing of that Order, while ignoring other 
issues that were raised in requests for rehearing of that Order; (3) 
Order No. 871-A does not address the merits of the requests for 
rehearing of Order No. 871 or modify Order No. 871 in any respect, 
and likewise fails to explain why the Commission views the existing 
record as insufficient to rule on the prior requests for rehearing; 
and (4) Order No. 871-A contemplates a schedule that effectively 
delays a Commission ruling on the merits of the requests for 
rehearing of Order No. 871 until ten months after they were 
submitted, which violates the text and spirit of the D.C. Circuit's 
recent en banc decision in Allegheny Defense.'' \9\
---------------------------------------------------------------------------

    \9\ Id. (emphasis in original).

    5. I for one would be interested to hear the Commission's 
response.\10\ Whether the Commission's refusal was intentional or a 
consequence of hasty action, the Commission's decision to ignore 
arguments properly raised runs contrary to the APA and stands as an 
obvious failure to engage in reasoned decision making.\11\ In addition 
to the APA violation I describe above, there are a number of other 
legal infirmities that require attention.
---------------------------------------------------------------------------

    \10\ See Limiting Authorizations to Proceed with Construction 
Activities Pending Rehearing, Order No. 871-A, 86 FR 7643 (Feb. 1, 
2021), 174 FERC ] 61,050 (2021) (Danly, Comm'r, dissenting) (Order 
No. 871-A).
    \11\ See New England Power Generators Ass'n, Inc. v. FERC, 881 
F.3d 202, 211 (D.C. Cir. 2018) (finding ``that FERC did not engage 
in the reasoned decisionmaking required by the Administrative 
Procedure Act'' because it ``failed to respond to the substantial 
arguments put forward by Petitioners and failed to square its 
decision with its past precedent''); Canadian Ass'n of Petroleum 
Producers v. FERC, 254 F.3d 289, 299 (D.C. Cir. 2001) (``Unless the 
Commission answers objections that on their face seem legitimate, 
its decision can hardly be classified as reasoned.'') (citations 
omitted); Tesoro Alaska Petroleum Co. v. FERC, 234 F.3d 1286, 1294 
(D.C. Cir. 2000) (``The Commission's failure to respond meaningfully 
to the evidence renders its decisions arbitrary and capricious.'').
---------------------------------------------------------------------------

II. The Commission's New Policy Presumptively Staying NGA Section 7(c) 
Certificate Orders Is Contrary to Law

    6. The Commission's new policy establishing a presumptive stay in 
section 7(c) certificate proceedings is simply beyond the Commission's 
authority. The power of eminent domain is surely profound and 
formidable. I cannot fault my colleagues for the anxiety they have 
expressed over its wise and just exercise. However, the Commission, as 
a mere ``creature of statute,'' can only act pursuant to law by which 
Congress had delegated its authority.\12\ Congress conferred the right 
to certificate holders to pursue eminent domain in federal district 
court or state court,\13\ having recognized that states ``defeat[ ] the 
very objectives of the Natural Gas Act'' \14\ by conditioning or 
withholding the exercise of eminent domain. Congress has made that 
determination. It has codified it into law. The Commission, as an 
executive agency, is empowered only to implement Congressional mandate, 
not to second-guess Congressional wisdom.
---------------------------------------------------------------------------

    \12\ Atl. City Elec. Co. v. FERC, 295 F.3d 1, 8 (D.C. Cir. 2002) 
(``As a federal agency, FERC is a `creature of statute,' having `no 
constitutional or common law existence or authority, but only those 
authorities conferred upon it by Congress.' '') (quoting Michigan v. 
EPA, 268 F.3d 1075, 1081 (D.C. Cir. 2001)); see Bowen v. Georgetown 
Univ. Hosp., 488 U.S. 204, 208 (1988) (``It is axiomatic that an 
administrative agency's power to promulgate legislative regulations 
is limited to the authority delegated by Congress.'').
    \13\ See 15 U.S.C. 717f(h).
    \14\ S. Rep. No. 80-429, at 3 (1947).
---------------------------------------------------------------------------

    7. It is true that while ``the Commission lacks the authority to 
deny or restrict the power of eminent domain in a section 7 
certificate,'' \15\ ``the Commission unquestionably may . . . stay its 
own orders.'' \16\ The Commission, however, has no authority to 
presumptively stay section 7 certificate orders.
---------------------------------------------------------------------------

    \15\ Order No. 871-B, 175 FERC ] 61,098 at P 45. It should be 
recognized that the Commission again preemptively answers a question 
that it directly posed in the pending Notice of Inquiry (NOI) for 
which comments are due May 26, 2021: ``Under the NGA, does the 
Commission have authority to condition a certificate holder's 
exercise of eminent domain?'' See Question B6 in Certification of 
New Interstate Nat. Gas Facilities, 174 FERC ] 61,125, at P 15 
(2021). The Commission continues to lull people into believing that 
the answers to the questions appearing in the NOI have yet to be 
resolved.
    \16\ Order No. 871-B, 175 FERC ] 61,098 at P 46.
---------------------------------------------------------------------------

    8. The Commission appears to rely on APA section 705 to issue its 
presumptive stay, but that section does not grant such power.\17\ APA 
section 705, titled ``Relief pending review,'' provides ``[w]hen an 
agency finds that justice so requires, it may postpone the effective 
date of action taken by it, pending judicial review,'' \18\ meaning the 
stay must be tied to litigation.\19\ The Commission's presumptive stay 
is not even tied to an application for rehearing let alone any 
litigation. Further, given the lack of discussion on how the Commission 
will implement this new policy, the assumption that the mere existence 
of a ``landowner protest'' automatically means that a stay is required 
in the interest of justice is

[[Page 26162]]

rather questionable. Will the Commission stay a certificate where there 
is a protest by a landowner with property interests that abut the 
proposed right-of-way but are not subject to condemnation? And the 
Commission's policy applies to where there is a ``landowner protest.'' 
Will the Commission apply the stay where a landowner protested but did 
not intervene? What about in the case where the landowner joined a 
protest, but may not have active interests in the proceeding? Some 
commenters have suggested that NGA section 19(c) grants the Commission 
such power.\20\ The Commission does not acknowledge or adopt these 
arguments. Even so, NGA section 19(c) does not grant the Commission the 
power to stay its orders before a rehearing application is even 
filed.\21\ Section 19(c) sets forth the rule--that ``[t]he filing of an 
application for rehearing under subsection (a) shall not . . . operate 
as a stay of the Commission's order''--and the exception to that rule--
``unless specifically ordered by the Commission.'' \22\ In order for 
the exception to apply, the general rule must first apply: That is, 
someone must have filed a request for rehearing. Further, the 
Commission's new policy elevates the stay from being the exception to 
being the rule itself, assuming the legislative power to amend section 
19(c) to read: An order is stayed unless specifically ordered by the 
Commission. Only Congress can amend a statute.
---------------------------------------------------------------------------

    \17\ See id. P 46 n.91 (citing 5 U.S.C. 705). I am unaware of 
Commission precedent that relies on APA section 705 as authority to 
stay Commission orders (other than a handful of hydropower cases 
granting the stay of the commencement of construction deadline).
    \18\ 5 U.S.C. 705 (emphasis added).
    \19\ See Bauer v. DeVos, 325 F. Supp. 3d 74, 106 (D.D.C. 2018) 
(``Most significantly, the relevant equitable considerations are not 
free-floating but, rather, must be tied to the underlying 
litigation.'').
    \20\ See Public Interest Organizations February 16, 2021 Brief 
at 13-14 (arguing the Commission has discretion under NGA section 
19(c) to stay a certificate order); Niskanen Center, et al. March 3, 
2021 Reply Brief at 4 (``[T]he NGA's only mention of an agency stay 
is in Section 19(c). . . . The NGA also does not constrain the 
Commission's authority as to when it can `specifically order' a stay 
. . . .'').
    \21\ See 15 U.S.C. 717r(c).
    \22\ Id.
---------------------------------------------------------------------------

    9. Let us also not forget that identical phrases in the same 
statute are normally given the same meaning.\23\ NGA section 19(c) 
provides that ``[t]he commencement of proceedings under subsection (b) 
of this section shall not, unless specifically ordered by the court, 
operate as a stay.'' \24\ Imagine a scenario in which, in the course of 
a one-off proceeding, a court of appeals announced that, going forward, 
it would begin presumptively staying an entire category of Commission 
orders before a petition is filed. Article III courts, of course, have 
their own procedures, traditions, and powers. Still, such reading of 
the statute is absurd.
---------------------------------------------------------------------------

    \23\ Powerex Corp. v. Reliant Energy Servs., Inc., 551 U.S. 224, 
232 (2007) (``identical words and phrases within the same statute 
should normally be given the same meaning'') (citation omitted).
    \24\ 15 U.S.C. 717r(c) (emphasis added).
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    10. Many are quick to turn to NGA section 16 when all else has 
failed. However, the Commission likewise cannot rely on NGA section 16 
in support of a presumptive stay. Section 16 of the NGA does not 
represent an independent grant of authority: ``[t]he Commission shall 
have power to perform any and all acts, and to prescribe, issue, make, 
amend, and rescind such orders, rules, and regulations as it may find 
necessary or appropriate to carry out the provisions of this chapter.'' 
\25\ This does not create new powers under the NGA or supersede section 
19(c), which sets forth the conditions for granting a stay. Moreover, 
like its counterpart in Federal Power Act section 309,\26\ the use of 
NGA section 16 must be ``consistent with the authority delegated to it 
by Congress.'' \27\
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    \25\ Id. Sec.  717o.
    \26\ 16 U.S.C. 825h.
    \27\ Verso Corp. v. FERC, 898 F.3d 1, 7 (D.C. Cir. 2018) 
(quoting Xcel Energy Servs. Inc. v. FERC, 815 F.3d 947, 952 (D.C. 
Cir. 2016)); see id. at 10 (``Section 309 accordingly permits FERC 
to advance remedies not expressly provided by the FPA, as long as 
they are consistent with the Act.'') (emphasis added) (citing TNA 
Merch. Projects, Inc. v. FERC, 857 F.3d 354, 359 (D.C. Cir. 2017) 
(citing Niagara Mohawk Power Corp. v. Fed. Power Comm'n, 379 F.2d 
153, 158 (D.C. Cir. 1967))).
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    11. I am aware of no other grant of authority that the majority may 
be relying upon in support of its new presumptive stay policy.\28\ At 
its root, the Commission's presumptive stay policy impermissibly does 
what the Commission says it cannot do: The stay is designed to restrict 
the use of eminent domain.\29\ It impedes a certificate holder's right 
to exercise eminent domain immediately upon the issuance of the 
certificate, while claiming to allow the pipeline to ``continue to 
engage in development related activities that do not require use of 
landowner property or that are voluntarily agreed to by the 
landowner.'' \30\ It effectively permits the stay to be lifted so long 
as there is ``a commitment by the pipeline developer not to begin 
eminent domain proceedings until the Commission issues a final order on 
any landowner rehearing requests.'' \31\ How a pipeline can conduct any 
activity authorized by a stayed certificate or why a pipeline would 
request to lift a stay other than to exercise eminent domain are 
questions that beg clarification.
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    \28\ To the extent that the Commission believes that by 
``applying the criteria for granting a stay on a case-by-case 
basis'' cures any legal infirmity, it is wrong. Order No. 871-B, 175 
FERC ] 61,098 at P 51 n.103. It is illogical to have a presumption 
in advance of a rehearing request and is contrary to the plain text 
in the NGA.
    \29\ See id. P 45.
    \30\ Id. P 49.
    \31\ Id. P 51 (emphasis added).
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    12. Even if it were not ultra vires, the Commission's 
interpretation results in unfair surprise. Since at least 1965, the 
Commission (and the Federal Power Commission) have placed the burden on 
movants for stays to show that they will be irreparably injured in the 
absence of a stay.\32\ The Commission's policy has been to ``refrain 
from granting stays in order to assure definitiveness and finality in 
Commission

[[Page 26163]]

proceedings.'' \33\Now after merely asking, ``[s]hould the Commission 
modify its practices or procedures to address concerns regarding the 
exercise of eminent domain while rehearing requests are pending,'' \34\ 
in an order on rehearing where the issue of eminent domain was not 
raised, the Commission suddenly departs from its policy favoring 
finality and shifts the burden to the pipeline before a rehearing is 
even filed. The Commission never announced that it was considering a 
presumptive stay policy or under what authority. In fact, many 
commenters did not address the presumptive stay. Those harmed by this 
surprise issuance should consider that agencies are not given deference 
``when there is reason to suspect that the agency's interpretation 
`does not reflect the agency's fair and considered judgment on the 
matter in question.' '' \35\
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    \32\ See, e.g., Consol. Edison Co. of N.Y., 33 F.P.C. 965, at 
969 (1965) (``Four tests have been prescribed by the Court of 
Appeals, each of which an applicant for stay must satisfy in order 
to justify the extraordinary relief represented by a stay of an 
administrative order.'') (citations omitted); see also Midcontinent 
Indep. Sys. Operator, 151 FERC ] 61,220, at P 27 (2015) (``Otter 
Tail has not met the burden to show that it will suffer irreparable 
injury without a stay and that a stay is in the public interest.''), 
vacated and remanded for reasons not applicable, Ameren Servs. Co. 
v. FERC, 880 F.3d 571 (D.C. Cir. 2018); Bradwood Landing LLC, 128 
FERC ] 61,216, at P 10 (2009) (``We find that Oregon has not met its 
burden to demonstrate that it will suffer irreparable harm absent 
the granting of a stay.''); Acadia Power Partners, LLC, 108 FERC ] 
61,076, at P 5 (2004) (``We will deny El Paso's request for a stay, 
as we find that El Paso has failed to meet its burden of 
demonstrating that it will suffer irreparable harm absent a 
stay.''); Se. Hydro-Power, Inc., 74 FERC ] 61,241, at 61,825 n.12 
(1996) (``the burden is on the movant . . . to demonstrate why its 
request for a stay is justified''); Constr. Work in Progress for 
Pub. Utils., 24 FERC ] 61,071, at 61,190 (1983) (``the burden is 
upon petitioners for such extraordinary action to show that 
significant harm will be incurred and that the equities favor 
granting the stay.''); Exemption from the Licensing Requirements of 
Part I of the Fed. Power Act of Certain Categories of Small 
Hydroelectric Power Projects with an Installed Capacity of 5 
Megawatts or Less, 20 FERC ] 61,061, at 61,134 (1982) (``In the 
context of their request for a stay . . . the burden is upon the 
petitioners for such extraordinary action to show that significant 
harm will be incurred and that the equities favor granting the 
stay.''); Cities Serv. Oil Co., 53 F.P.C. 8, at 8-9 (1975) (``The 
applicant for a stay has the burden of establishing, absent the 
grant of such relief, it would be irreparably harmed.''); Columbia 
Gulf Transmission Co., 37 F.P.C. 310, at 310 (1967) (``It is settled 
that in order to establish a case for a grant of extraordinary 
relief in the nature of a stay the applicant has the burden of 
establishing that absent the grant of such relief it would be 
irreparably injured.'') (citation omitted).
    \33\ SFPP, L.P., 166 FERC ] 61,211, at P 7 (2019) (``When 
considering requests for a stay of Commission action, the 
Commission's general policy is to refrain from granting stays in 
order to assure definitiveness and finality in Commission 
proceedings.''); see also Millennium Pipeline Co., L.L.C., 141 FERC 
] 61,022, at P 13 (2012) (``Our general policy is to refrain from 
granting stays in order to assure definiteness and finality in our 
proceedings.'') (citation omitted); Midwestern Gas Transmission Co., 
116 FERC ] 61,182, at P 158 (2006) (``The Commission's general 
policy is to refrain from granting stays of its orders, in order to 
assure definiteness and finality in Commission proceedings.'') 
(citation omitted); Guardian Pipeline, L.L.C., 96 FERC ] 61,204, at 
61,869 (2001) (``The Commission's general policy is to refrain from 
granting stays of its orders, in order to assure definiteness and 
finality in Commission proceedings.'') (citations omitted); Bos. 
Edison Co., 81 FERC ] 61,102, at 61,377 (1997) (``However, the 
Commission follows a general policy of denying motions for stay 
based on a need for finality in administrative proceedings.''); CMS 
Midland, Inc., 56 FERC ] 61,177, at 61,630-31 (1991) (``We follow, 
however, a general policy of denying motions for stays, based on the 
need for definitiveness and finality in administrative 
proceedings.'') (citations omitted); Holyoke Water Co., 30 FERC ] 
61,283, at 61,575 (1985) (``The Commission has followed a general 
policy of denying stays, unless a party has demonstrated that it 
will be irreparably injured in the absence of a stay.'') (citations 
omitted).
    \34\ Order 871-A, 174 FERC ] 61,050 at P 7.
    \35\ Christopher v. SmithKline Beecham Corp., 567 U.S. at 155 
(citation omitted); see also Kisor v. Wilkie, 139 S. Ct. 2400, 2421 
(2019) (``And recall too that deference turns on whether an agency's 
interpretation creates unfair surprise or upsets reliance 
interests.'').
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III. The Commission's Decision is Bad Policy

    13. On top of being unlawful, the presumptive stay is also bad 
policy. Contrary to the Commission's claims, the presumptive stay does 
not strike the appropriate balance between pipelines and 
landowners.\36\ There can be no ``balance'' when the Commission 
violates clear Congressional mandate and attempts to withhold a 
statutory right afforded to certificate holders, especially when 
applied to applications already pending before the Commission.\37\
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    \36\ Order 871-B, 175 FERC ] 61,098 at P 49.
    \37\ See U.S. Senators Hoeven, Manchin, Barrasso, Tester, 
Capito, Sinema, Cassidy, Cornyn, Cramer, Crapo, Cruz, Daines, 
Hagerty, Hyde-Smith, Inhofe, Lankford, Marshall, Moran, Risch, 
Rounds, Sullivan, Tillis, Thune, Toomey, and Wicker, Letter, Docket 
No. PL18-1-000, at 1 (filed April 30, 2021) (``Delaying and moving 
the regulatory goalposts on projects filed in good faith is contrary 
to the otherwise equitable application of the Policy Statement that 
all stakeholders expect. At a minimum, these projects should not be 
subject to newly contemplated considerations that fall outside the 
scope of the current Policy Statement or go beyond the Commission's 
statutory authority.'').
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    14. Further, the Commission's attempt to downplay the industry's 
concerns (including delayed project timelines, increased regulatory 
uncertainty, and higher likelihood of project terminations) because 
``any stay will last no longer than approximately 150 days following 
the issuance of a certificate order'' \38\ is, to put it mildly, 
unconvincing. Requiring the passage of four months before a certificate 
can go into effect is significant, especially since the time required 
for processing applications has already dramatically increased.\39\ 
``Many of the proposed projects before the Commission, some pending for 
more than a year, are critical to addressing supply issues and 
strengthening our energy infrastructure.'' \40\ It is not inconceivable 
that those projects whose applications have been pending for more than 
a year ultimately will be canceled as a result of delay. By way of 
example, nearly two years ago, Dominion Energy Transmission, Inc. 
withdrew its application for a certificate for its Sweden Valley 
Project that it had filed seventeen months prior.
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    \38\ Order 871-B, 175 FERC ] 61,098 at P 49.
    \39\ See, e.g., Northern Natural Gas Company February 5, 2021 
Motion for an Expedited Order for the Northern Lights 2021 Expansion 
Project under CP20-503 (requesting expedited action for application 
filed on July 31, 2020); Iroquois Gas Transmission System, L.P. 
January 26, 2021 Request for Prompt Issuance of Certificate of 
Public Convenience and Necessity under CP20-48 (requesting expedited 
action for application filed on February 3, 2020).
    \40\ U.S. Senator Hoeven, et al., Letter, Docket No. PL18-1-000, 
at 1 (filed April 30, 2021) (emphasis added).
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    15. Finally, in yet another unexplained deviation from its past 
precedent, the Commission holds that, in the event the Commission were 
to grant rehearing for the purposes of requesting further briefing in 
order to substantively reconsider a ruling, ``the original 
authorization would no longer be in effect and the provisions of Order 
No. 871 would no longer apply since there would be no final order 
pursuant to which a notice to proceed could be issued.'' \41\ The 
Commission provides no citation for this holding, the consequences of 
which are that granting rehearing for purposes of further consideration 
causes the original order to be vacated. Not only does the holding find 
no support in NGA section 19, but it is also contrary to the decades of 
Commission practice wherein the issuance of tolling orders for the 
purposes of further consideration did not vacate the original order.
---------------------------------------------------------------------------

    \41\ Order No. 871-B, 175 FERC ] 61,098 at P 27.
---------------------------------------------------------------------------

    16. Further, this holding will wreak havoc on the Commission's 
administration of other provisions under the NGA and FPA. For example, 
if the Commission requests further briefing in response to a request 
for rehearing of an NGA section 4 or FPA section 205 order on a 
proposed rate change, what rate should be charged? Or if the Commission 
requests further briefing on a request for rehearing of a complex order 
regarding market design, what rules apply to an auction that occurs 
before the Commission rules on the rehearing request? Would a request 
for further briefing vacate a Commission order under NGA section 5 or 
FPA section 206 finding that a certain rate or tariff provision is not 
just and reasonable and reinstate the prior rate or tariff provision? 
Is it only orders issued pursuant to NGA section 7 that are vacated 
when the Commission requests further briefing and, if so, what is the 
statutory basis for such a distinction? The Commission appears not to 
have even considered these far-reaching consequences of its holding and 
provides no explanation as to how these and many other difficult issues 
should be dealt with.

IV. Conclusion

    17. In the past three months, with barely any warning or process, 
the Commission has called every existing certificate into question in 
Algonquin, reversed years of significance analysis in Northern, and 
written the right to seek eminent domain upon receipt of a certificate 
out of the Natural Gas Act. As the Commission continues issuing such 
unlawful and ill-conceived orders, we will see further severe 
curtailment of investment in and construction of critical natural gas 
infrastructure which will inevitably drive up prices and gravely 
jeopardize reliability.
    For these reasons, I respectfully dissent.

-----------------------------------------------------------------------

James P. Danly,

Commissioner.

Department of Energy

Federal Energy Regulatory Commission

Limiting Authorizations To Proceed With Construction Activities Pending 
Rehearing

CHRISTIE, Commissioner, concurring:

    1. I write separately to add the following.
    2. Last year the Commission issued Order No. 871.\1\ Just a few 
weeks later, the D.C. Circuit issued its ruling in Allegheny.\2\
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    \1\ Order No. 871, 171 FERC ] 61,201(2020).
    \2\ Allegheny Defense Project v. FERC, 964 F.3d 1 (D.C. Cir. 
2020) (en banc) (Allegheny).
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    3. The combination created deep uncertainty, as well as the threat 
under

[[Page 26164]]

Order No. 871, that a certificated facility could have its notice to 
proceed with construction withheld potentially for an unlimited period 
of time while requests for rehearing remained pending before the 
Commission.
    4. Today's order is necessary to address the present unsustainable 
situation. While it may not be perfect nor exactly how I alone would 
resolve the uncertainties and threats created by Order No. 871, it does 
represent an acceptable compromise, consistent with the applicable law.
    5. Notably, it puts clear time limits--where there are none now 
under Order No. 871--on how long the Commission is required to withhold 
a notice to proceed with construction while the Commission considers a 
request for rehearing.
    6. Second, it sets forth a policy for future cases--not mandatory, 
but subject to the facts and circumstances of each case--that a 
property owner opposing the involuntary use of eminent domain should be 
protected from a seizure of his or her property during a reasonable 
period of time while the Commission is still considering requests for 
rehearing; however, this period will also be subject to the same time 
limits as the withholding of the notice to proceed with construction.
    7. Third, nothing in today's order will prevent the developer from 
continuing expeditiously with all development activities that do not 
involve construction or the use of eminent domain against unwilling 
property owners. Voluntary land acquisition is unaffected by this 
order.
    8. I understand the desire of the dissent simply to repeal Order 
No. 871 with nothing more,\3\ but that is not a realistic prospect; put 
bluntly, it is not going to happen. Rather than allow the current 
unsustainable status quo to continue, under present circumstances I 
believe this order represents a realistic path forward. If it is not 
administered fairly or does not bring the clarity and certainty needed, 
it can be revisited.
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    \3\ Danly Dissent at PP 1-2.
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    Accordingly, I respectfully concur.

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Mark C. Christie,
Commissioner.

[FR Doc. 2021-09829 Filed 5-12-21; 8:45 am]
BILLING CODE 6717-01-P


