The Federal Energy Regulatory Commission today surprisingly rejected a Pacific coast LNG export terminal. Both Democratic Commissioner Richard Glick and Republican Commissioner Bernard McNamee turned down the request of the Jordon Cove Energy Project for a terminal to be sited in Coos Bay, Ore.
McNamee’s vote was a surprise as he and fellow Republican Chairman Neil Chatterjee have been strong supporters of gas pipeline and LNG projects, over the consistent objections by Glick on environmental issues. Nor does the vote kill the project. “This is not a denial, the application remains pending,” said Chatterjee. “We will vote on this matter when we are ready.”
McNamee explained that he was prepared to support a green light for the
$10 billion project, until it came to light that the state of Oregon had raised objections. The Portland Business Journal reported earlier in the day, “In a letter to developer Pembina Pipeline Corp., the Department of Land Conservation and Development cited several failures to ‘establish consistency with specific enforceable policies,’ including the denial of a water quality permit and the project’s withdrawal of a removal-fill permit.”
Oregon Live reported, “In a letter to backers of the Jordan Cove Energy Project, agency director Jim Rue said that neither the Federal Energy Regulatory Commission nor the Army Corps of Engineers ‘can grant a license or permit for this project unless the U.S. Secretary of Commerce overrides this objection on appeal.’
McNamee said, “I want to see that letter. This is a complex project, which has come to the commission before. It needs to be considered in more detail and see what the state of Oregon has said.”
Glick said he would vote no on Jordon Cove in part because the commission has developed a consistent pattern of failing to take environmental issues, particularly greenhouse gas emissions, seriously in natural gas cases. He has raised similar objections in earlier cases, and dissented in whole or part to all 11 of today’s natural gas certification cases, 10 of which were approved. Glick said, “The commission has earned its reputation as a rubber stamp on pipeline issues.”
In other action today, FERC issued a notice of inquiry on “potential benefits and risks associated with the use of virtualization and cloud computing services in the operation of the nation’s bulk electric system.” Chatterjee said, “We want to create an environment that allows and encourages innovation and new technologies to flourish. At the same time, our cyber security standards must clearly address new technologies and help define when and where they could be us
The commission also issued a fleet of four orders aimed, the agency said in a press release, at “improving the buyer-side market power mitigation rules to send accurate price signals to markets and to ensure adequate supplies for consumers” in the New York ISO’s capacity market. FERC said, Today’s actions came in four orders that address specific, relatively narrow buyer-side market power issues in NYISO pending before the Commission. Overall, the orders narrow the exemptions from NYISO’s buyer-side market power mitigation rules in its mitigated capacity zones.”
Glick objected to the orders, which are similar to FERC’s December order on PJM’s “minimum offer price rule” or MOPR, which also drew Glick’s opposition. In both cases, he said the practical effect of FERC’s actions disadvantages renewables, energy efficiency programs, and storage in the capacity markets.
— Kennedy Maize