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LNG - Laws and Regulations
States' Rights in Authorization of LNG Facilities
States still have the ability to effectively "veto" an LNG facility
by denying permits associated with the Clean Water Act, the Coastal
Zone Management Act, and the Clean Air Act.
The Federal Energy Regulatory Commission has exclusive authority
under the Natural
Gas Act  to authorize the siting of facilities
for imports or exports of LNG. But that authorization is conditioned
on the applicant's satisfaction of other statutory requirements
for various aspects of the project. Substantial authority exists
through current federal statutes pertaining to those aspects of
the project for states to authorize or block and thereby effectively
"veto" development of an LNG facility. Nothing in the Energy
Policy Act of 2005 changes the states' authorities in this
regard. These are summarized below:
Coastal Zone Management Act
Section 307(c) - An LNG project proponent must certify that
the proposed activity in a designated coastal zone complies
with the enforceable policies of the affected state's coastal
zone management program. If the state does not concur with
the certification, no FERC approval to construct may be granted.
This applies to all Federal permits and authorizations, including
FERC and the U.S. Army Corps of Engineers. A finding of inconsistency
can be appealed to the Secretary of Commerce.
Clean Water Act
Section 401 - A certification of compliance with the state's
water quality standards is required from the responsible state
agency for any activity (including construction and operation
of LNG import facilities) that may result in a discharge into
navigable waters. If the 401 certification is denied, the LNG facility cannot be constructed.
Section 404 - A permit is required from the U.S. Army Corps
of Engineers for discharge of dredged and fill material. The
Corps permit requires applicants to obtain a section 401 certification,
which can be blocked as stated above.
Clean Air Act
Section 502 - A permit is required for any person to operate
a source of air pollution, as detailed in the Act. If the
responsible state agency does not issue the permit, the project
cannot go forward.
Cooperating Agency with FERC
Beyond its authority based on these Federal statutes, the
state also has the ability to be a cooperating agency with
FERC during the review of a project under the National Environmental
Policy Act (NEPA), and can contribute to the complete environmental
review of the proposal.
List
of Coastal State Agencies enforcing Clean Water Act, Clean Air
Act, and Coastal Zone Management Act  - updated 08/08/05
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