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ANR Pipeline Co. v. Federal Energy Regulatory Comm'n

Citation: 30 ELR 20421
No. No. 99-1010, 205 F.3d 403/(D.C. Cir., 02/22/2000)

The court upholds a Federal Energy Regulatory Commission (FERC) order and denies a gas pipeline operator's petition to review FERC's decision not to hold a comparative hearing before permitting a competitor of the operator to build and operate a natural gas pipeline, and further holds that the operator did not have standing to bring a National Environmental Policy Act (NEPA) action. The court first holds that FERC did not err in failing to hold a comparative hearing before granting the competitor's certificate to build a new pipeline. FERC must hold a comparative hearing if the projects being considered are mutually exclusive. Here the pipelines run roughly parallel, but FERC found that they were not necessarily dependent on transporting the same reserves or on serving the same customers. Additionally, the pipeline operator's system accesses an area of the Outer Continental Shelf where large new gas reserves are being developed. While the fact that the competitor's pipeline is already up and running places the operator at a disadvantage, FERC concluded that this kind of economic disadvantage is different from a situation in which economic factors make it possible to grant only one license. The court next holds that FERC's departure from prior policy regarding comparative hearings was justified in light of changed circumstances. An agency may not depart from prior policy without an explanation, but FERC explained how changed circumstances justified a new policy. It was entirely appropriate for FERC to change its regulatory approach in response to technological changes in the industry. The court finally holds that the pipeline operator lacks standing to bring a NEPA action. NEPA is a statute aimed at protecting the environment, but the operator did not allege it would suffer any environmental injury as a result of FERC's action. The economic interest expressed by the operator is not within the zone of interests protected by NEPA.

Counsel for Petitioner
Daniel F. Collins, Senior Vice President
The Coastal Corporation
2000 M St. NW, Washington DC 20036
(202) 466-7430

Counsel for Respondent
Monique Penn-Jenkins
Federal Energy Regulatory Commission
825 N. Capitol St. NE, Washington DC 20426
(202) 208-0200

Before Williams and Ginsburg, JJ.