April 18, 2005
The Federal Energy Regulatory Commission would preempt state and local regulation of liquid natural gas facilities if a provision in the House energy bill passes.
The law (H.R. 359) would put an end to a legal battle between the federal government and the state of California over whether the current law gives FERC the power to preempt local concerns over a proposed Long Beach LNG facility. Massachusetts state and local officials are launching a legal challenge against an import facility in Fall River, Mass. Other states have used zoning and other provisions to reject LNG sites. In Maine, three LNG facilities have been rejected in local votes.
Local concerns about LNG facilities were heightened when a federal report warned of the consequences of a terrorist attack on an LNG transport tanker. Currently the U.S. has four LNG import facilities, located in Massachusetts, Maryland, Georgia and Louisiana. FERC has given approval to three more on the Gulf Coast. LNG’s share of the natural gas market is expected to grow from 3 percent to more than 21 percent by 2025.
Under the proposal, FERC would consult with state and local regulators, but could override their concerns if it chose to do so. Also, it would be “presumptively concluded” that a local agency has approved a proposal if the local agency does not meet the federal deadline for considering the proposal. State and local governments would not have the power to act if they discover problems at a facility during a safety inspection.
The full text of the Liquefied Natural Gas Act of 2005 (H.R. 359) and related information are available from Thomas.
The New Rules Project - http://www.newrules.org/