FERC denies pipeline appeal
Jersey City to file lawsuit within 60 days
by E. Assata Wright
Reporter staff writer
Oct 21, 2012 | 2937 views | 0 0 comments | 10 10 recommendations | email to a friend | print
DOWN TO THE WIRE – Associate City Counsel Derek Fanciulo (right) said the city will file an appeal to the Spectra pipeline by the end of the year. Pictured left: Dale Hardman, founder of No Gas Pipeline, who is expected to file a separate lawsuit.
DOWN TO THE WIRE – Associate City Counsel Derek Fanciulo (right) said the city will file an appeal to the Spectra pipeline by the end of the year. Pictured left: Dale Hardman, founder of No Gas Pipeline, who is expected to file a separate lawsuit.
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The Federal Energy Regulatory Commission (FERC) has officially denied Jersey City’s request that the agency reconsider an order allowing a controversial natural gas pipeline to be built through the city. The decision was made at FERC’s regular meeting in Washington, D.C. on Thursday, Oct. 18.

Spectra Energy has already broken ground for the pipeline in Bayonne and a groundbreaking in Jersey City could be imminent, despite the city’s opposition to the project and threat of a lawsuit.

For more than two years, Mayor Jerramiah Healy and the city have argued that this pipeline, which would be 30 inches in diameter with a possible pressure of 1,200 pounds per square inch, is the first of its magnitude to be built in a densely-populated urban area near several transit hubs such as the Holland Tunnel and the New Jersey Turnpike.

After FERC approved Spectra Energy’s pipeline project in May, the city filed an appeal asking the agency to reconsider. The city’s 43-page appeal, officially known as a “Request for Rehearing,” questioned the constitutionality of FERC’s decisions and questioned whether the federal agency could fairly evaluate construction proposals for gas pipelines since the agency is funded entirely by fees generated from energy companies. The city’s appeal argued that, since energy companies entirely fund FERC, the agency is biased toward those companies in a way that violates fundamental rights of due process.

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‘We believe there are legitimate constitutional and abuse of discretion issues in the pipeline approval process.’ – Jerramiah T. Healy

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The city’s appeal cited research that found that, since 2010, FERC has approved nearly three dozen pipelines. In every case but one, the agency approved the pipeline route that the pipeline company proposed – despite the existence of dozens of other viable alternative routes.

The agency, however, refused to reconsider its decision last week, “essentially re-approving the pipeline,” according to Associate Corporate Counsel Derek Fanciullo, who was in Washington for the FERC meeting.

“While we are disappointed with FERC’s decision, it is one we expected and we could not move forward until the commission either approved or denied our request for a rehearing,” said Mayor Jerramiah T. Healy.” We are committed to bringing this matter before a federal circuit court, as we believe there are legitimate constitutional and abuse of discretion issues in the pipeline approval process.”

According to Fanciullo, the city now has 60 days to file an appeal in federal court.

Almost 20 miles of piping

City officials – from engineers to Homeland Security staffers and economic development experts – have challenged Spectra’s claims that the pipeline does not present a serious hazard.

Under the plans approved by FERC, the pipeline will include 19.8 miles of new and replacement pipes, six new stations, and other related modifications in Jersey City, Bayonne, and Linden. In Jersey City, the underground pipeline route would run through nearly every municipal ward and near such sensitive areas as Jersey City Medical Center, several schools, the Holland Tunnel, the New Jersey Turnpike, and transportation infrastructure near the Jersey City-Hoboken border.

The pipeline would cross the Hudson River into New York to connect the company’s existing pipeline to Manhattan and Staten Island, supplying customers of Con Edison.

Spectra has also said that it will supply energy to power facilities operated by Bayonne Plant Holding and boilers at the International Matex Tank Terminals, also in Bayonne.

But because of the pipeline’s close proximity to sensitive areas, local activists and city officials have argued that a natural gas explosion could cause mass casualties and significantly damage important transportation infrastructure.

Healy has argued that the potential hazards posed by a gas pipeline could hurt future commercial and residential development in the city. The city has long argued that the pipeline should be re-routed underground and under the Hudson River.

Despite these concerns, Spectra received approval from FERC and permits from the New Jersey Department of Environmental Protection.

“We are pleased that FERC has confirmed the validity of its Certificate Order and the findings of other state and federal agencies, and we look forward to completing this critical infrastructure project and delivering clean and affordable natural gas to the New Jersey and New York regions,” said Spectra Spokeswoman Marylee Hanley last week.

In court by Christmas

Healy and the city have been gearing up for a legal fight against the pipeline since the beginning of the year. Procedurally, however, the city had to wait for FERC to formally approve the pipeline, which it did in May. Then the city was required to file a motion for reconsideration.

Since filing its appeal in the spring, the city had been awaiting word from FERC regarding whether or not it would consider the appeal. This appeal was effectively denied by FERC last week at its commissioners’ meeting when FERC voted on a consent agenda item approving the pipeline.

Fanciullo said the city will now ask a federal circuit court to review FERC’s decision and the city’s legal arguments against it.

“Basically, what we will do now is respond [in court] to FERC’s response,” said Fanciullo. “We’ll make many of the same legal arguments that we’ve already made. We are coordinating our efforts with a couple of other attorneys representing other entities.”

The city is, for example, likely to coordinate its legal efforts with those of environmental groups that have their own separate reasons for opposing the pipeline.

In addition to a lawsuit from the city, the Jersey City grassroots membership-based organization No Gas Pipeline is also expected to file a lawsuit of its own.

“We now will see about filing a suit as an appeal in federal court,” said Dale Hardman, founder of No Gas Pipeline. “The federal court has the power to overturn a FERC ruling.”

Given the timeline by which the city must file its appeal in federal court, its case should be filed before the end of the year.

E-mail E. Assata Wright at awright@hudsonreporter.com.

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