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Environment & Energy Report

Atlantic Coast Pipeline Faces Hurdles Despite SCOTUS Win (3)

June 15, 2020, 5:03 PMUpdated: June 15, 2020, 9:45 PM

The Trump administration and the Atlantic Coast pipeline scored a resounding win against environmentalists at the Supreme Court on Monday, but developers still have to clear several permitting hurdles before work can begin.

The justices ruled 7-2 that a lower court overstepped when it canceled a critical permit allowing the East Coast natural gas project to cross the iconic Appalachian Trail.

The case focused on a technical legal question about which agency has authority to allow crossings of the Appalachian Trail, but came to symbolize a broader debate over the expansion of oil and gas infrastructure across the country.

While the high court revived an important permit, Atlantic Coast is still missing several key federal approvals, including permits for impacts on endangered species, forestland, and water crossings, Southern Environmental Law Center attorney D.J. Gerken said.

“The pipeline’s in the same place it was before today,” Gerken, who represents an environmental coalition against the pipeline, told Bloomberg Law. “There’s a lot of process ahead.”

The law center and other environmental groups are already challenging other federal approvals in court, and tracking any new permits.

Backed by Dominion Energy Inc. and Duke Energy Corp., the proposed $8 billion pipeline would run some 600 miles from West Virginia shale gas fields to markets in Virginia and North Carolina.

‘Forest for the Trees’

Writing for the majority, Justice Clarence Thomas concluded that the U.S. Forest Service retains jurisdiction over the forestland the trail crosses, even though the National Park Service oversees the hiking path.

“Sometimes a complicated regulatory scheme may cause us to miss the forest for the trees,” Thomas wrote, “but at bottom, these cases boil down to a simple proposition: A trail is a trail, and land is land.”

The Forest Service said the decision “restored the jurisdictional framework the Forest Service and the National Park Service have understood and operated under for the past 50 years, since the designation of the Appalachian National Scenic Trail.”

Monday’s decision clears a major legal obstacle that could have derailed the Atlantic Coast pipeline, and represents a critical check against a string of court decisions that disrupted development.

“This will not guarantee that the pipeline will be built,” said Robert Percival, who leads the environmental law program at the University of Maryland, “but it greatly eases the path forward for its construction.”

Atlantic Coast

Backers of the Atlantic Coast pipeline celebrated the high court’s ruling and said they’ve worked hard to minimize any disturbances to the Appalachian Trail.

“For decades, more than 50 other pipelines have safely crossed the trail without disturbing its public use,” Ann Nallo, a company spokeswoman, said. “The Atlantic Coast Pipeline will be no different.”

She noted that the project is slated to cross hundreds of feet below the trail as it traverses the Blue Ridge mountains in Virginia’s George Washington National Forest, and construction won’t take place on the trail itself.

Atlantic Coast is eager to resolve separate permitting issues, Nallo added.

But the project’s overall outlook still doesn’t look promising given the other permitting obstacles it faces, Bloomberg Intelligence analyst Brandon Barnes said.

Natural Resources Defense Council attorney Gillian Giannetti said her group and others are still pushing against various permits for the project, which she called an “affront to environmental justice,” due to a planned pressure station in the majority Black community in Union Hill, Va. A federal court recently scrapped a permit for the site.

“Disproportionately, we build infrastructure in poor communities and communities of color and ask them to shoulder the burden even though they will not get any of the perceived benefits,” Giannetti said.

NRDC filed an amicus brief supporting pipeline opponents at the Supreme Court. Giannetti argued that Justices Sonia Sotomayor and Elena Kagan, the two dissenters in the case, properly recognized that the Appalachian Trail should be managed as land, “not based on some metaphorical interpretation but based explicitly on the federal text.”

Other Projects

The Supreme Court’s ruling has repercussions for other projects, namely the Mountain Valley pipeline, which has faced delays due to similar challenges to its federal permits, including one for an Appalachian Trail crossing.

The court’s decision clears that hurdle for Mountain Valley. A spokeswoman said pipeline builders expect to resolve other permit issues soon.

“The market probably appreciates this,” Barnes said. “This is an incredibly important opinion for energy infrastructure.”

Pipeline builders, industry associations, and like-minded public officials dished out statements Monday cheering the Supreme Court’s decision as a victory for energy development.

“President Trump has long called for expanding energy infrastructure across the nation,” Energy Secretary Dan Brouillette said in a statement. “Today’s ruling by the U.S. Supreme Court brings us one step closer to making that a reality.”

The Interstate Natural Gas Association of America likewise framed the ruling as a win for “American energy security, our economy and our environment.”

But Mayer Brown attorney Timothy S. Bishop, who isn’t involved in the case, cautioned that the ruling has limited impacts on the energy industry at large.

“It strikes me as a decision about which agency has authority over what happens on the land it regulates, and the court’s answer to that question won’t necessarily benefit any particular interest or sector,” he said.

Plus, the Supreme Court’s decision leaves room for challenges to pipeline crossings that directly interfere with protected trails, Hall Estill attorney Joel P. Johnston said in an email.

“As such, while this decision does clarify the U.S. Forest Service has authority to issue such permits, a project that would require surface clearing, visible impacts, noise impacts, etc. can still likely be challenged on those grounds,” he said.

Appalachian Trail

Opponents of Atlantic Coast have maintained that the pipeline will spoil views along the footpath, and industrialize an otherwise wild area.

Virginia Wilderness Committee board member Lynn Cameron told Bloomberg Law earlier this year that allowing the pipeline to cross the trail would “transform” the experience of hiking to overlooks like Cedar Cliffs, a scenic area along the trail near the Blue Ridge Parkway.

But other trail advocates are breathing a sigh of relief after the Supreme Court’s decision.

The Appalachian Trail Conservancy, a nonprofit focused on the trail, was concerned that a win for the environmental groups would have the unintended consequence of disrupting a carefully calibrated management scheme that relies on cooperation among different agencies, landowners, and private parties.

“At the end of the day, the intent of the National Trails Act was in fact to allow for multi-jurisdictional authority,” president and CEO Sandra Marra said Monday.

“I hate to say, oh, we’re happy” about the decision, she added, noting that her group is still committed to pushing the Federal Energy Regulatory Commission to reform its pipeline approval process.

The environmental coalition challenging the Atlantic Coast pipeline includes the Sierra Club. The Sierra Club has received funding from Bloomberg Philanthropies, the charitable organization founded by Michael Bloomberg. Bloomberg Law is operated by entities controlled by Michael Bloomberg.

The case is U.S. Forest Serv. v. Cowpasture River Pres. Ass’n, U.S., No. 18-1584.

(Adds Forest Service comment in second section.)

To contact the reporters on this story: Ellen M. Gilmer in Washington at egilmer@bloombergindustry.com; Alexandra Yetter in Washington at ayetter@bloombergindustry.com

To contact the editors responsible for this story: Gregory Henderson at ghenderson@bloombergindustry.com; Rebecca Baker at rbaker@bloombergindustry.com

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