New York State’s authority over natural gas pipeline permitting suffered a major blow Mar. 12 when a federal appeals court ruled that the Department of Environmental Conservation — by failing to act promptly — waived its right to deny a water quality permit for a Hudson Valley pipeline project.
The decision clears the way for a 7.8-mile extension of the Millennium Pipeline linking to Competitive Power Venture’s nearly completed gas-fired power plant in Wawayanda, 70 miles northwest of New York City.
More broadly, the case may have ramifications for larger pipelines that have also had their state water permits denied by the DEC — Williams Cos.’ Constitution Pipeline and Northern Fuel Gas Co.’s Northern Access Pipeline.
The 2nd Circuit Court of Appeals handed CPV its legal victory only hours before a federal jury convicted a former senior aide to Gov. Andrew Cuomo in bribery schemes, including one allegedly aimed at gaining state approvals for the 680-megawatt plant.
Joseph Percoco now faces decades in prison for wire fraud and soliciting bribes. The same jury deadlocked in a related case against Peter Galbraith Kelly, a former CPV executive, and a mistrial was declared. Prosecutors had argued that Galbraith bribed Percoco to use his influence to get a power-purchase agreement for the gas plant, locking in the price of energy it generates.
In the wake of the jury’s decisions, MidHudson News reported that local officials were calling on Cuomo to suspend the plant’s imminent opening, pending a full investigation of state and local permit approvals his administration granted.
In addition to those calls from state Assemblyman James Skoufis (D-Woodbury), who represents Wawayanda, and Orange County Executive Steve Neuhaus, several good government groups called for new reviews of the CPV permitting process.
The high-profile criminal trial had been going on for weeks and was unrelated to the civil case before the appeals court in New York City.
The DEC had petitioned the court to hear its appeal of a Federal Energy Regulatory Commission order allowing construction of the pipeline extension in spite of the DEC’s denial of its water quality permit.
FERC, the lead regulatory agency on most gas pipeline matters, had argued that the DEC failed to issue its water permit denial within the one-year time limit specified in the federal Clean Water Act.
The DEC claimed that the clock should not start ticking on the one-year time limit until water permit applications are complete to the agency’s satisfaction. Otherwise, the DEC said, an applicant could file incomplete and inadequate information in an illegitimate bid to start the clock.
But FERC accused the DEC of stalling and said the law did not set conditions on its one-year time limit. A panel of appellate judges agreed with FERC. Judges Jose Cabranes, Debra Ann Livingston and Susan Carney declined the DEC’s petition to appeal of FERC’s order, allowing it to stand.
(Cabranes was appointed by President Bill Clinton, while Livingston was appointed by President George W. Bush, and Carney was appointed by President Barack Obama.)
A spokeswoman for Millennium said the “precedent-setting decision” affirms the Federal Energy Regulatory Commission’s interpretation of the Clean Water Act.
The DEC issued the following statement: “We certainly disagree with the decision, and are reviewing our options to determine any appropriate next steps regarding the pipeline project.”
Water Front- Peter Mantius 