2018 Vermont Law Top 10 Environmental Watch List

Energy Infrastructure Siting Authority

The siting of energy infrastructure has emerged as a new and complex legal and policy battlefield in the United States. Activists concerned about climate change seek to help wean the U.S. from fossil fuels by impeding the construction of pipelines that feed fossil fuel power plants. In many parts of the country, they are making strange-bedfellow alliances with property owners opposed to construction on their lands. On the other hand, the dramatic rise in renewable electricity generation, particularly wind power, has created a need for construction of new transmission lines to bring electricity to market.

Energy Infrastructure Siting

Click on the photo to watch a video on this issue with article co-author Nicholas Lansfeldt.

One aspect of the debate questions what level of government should have primary control over the siting of energy infrastructure. Current law on the subject is a hodgepodge. Under the Natural Gas Act, the Federal Energy Regulatory Commission (FERC), within the U.S. Department of Energy, has primary—but not exclusive—authority over the selection of routes for gas pipelines. By contrast, states have comprehensive authority over the siting of oil pipelines. And in the case of electric transmission lines, states exercise primary jurisdiction, subject to a largely theoretical power held by the Department of Energy to step in and force the construction of new lines where capacity is severely constrained.

Secretary of Energy Rick Perry and others argue that the Department of Energy should be granted new authority to override state energy siting decisions that impede development, at least where national security interests are at stake. At the same time, some states are seeking to corral federal siting authority. The New York Department of Environmental Conservation recently filed a petition in the U.S. Court of Appeals for the Second Circuit seeking to block construction of the Valley Lateral gas pipeline because FERC authorized the project without obtaining a necessary water quality signoff from the state.

Another hotly disputed issue is whether and under what circumstances energy developers should be permitted to acquire rights of way for transmission lines and pipelines without landowner consent. It has long been established that the government (federal or state), and those acting with government authorization, can “take” private property through eminent domain under the Takings Clause of the Fifth Amendment so long as the taking is for a “public use” and the owner receives “just compensation.”

Because many property owners feel a strong attachment to their land, the use of eminent domain is often controversial. In addition, public concern about the use of eminent domain has been elevated by the controversy associated with the Supreme Court’s 2015 decision in Kelo v. City of New London, upholding the power of a city to take private commercial and residential properties in order to promote a downtown redevelopment project.

Climate activists and property owners opposed to the Keystone XL and Dakota Access pipelines have urged state authorities not to permit the use of eminent domain to facilitate the construction of those projects. Despite this, Nebraska recently approved the Keystone XL route in that state, bringing the Keystone XL pipeline one step closer to completion. In response to landowner complaints about the proposed Palmetto Pipeline, designed to transport refined oil products from the Gulf Coast to the Southeast, the states of Georgia and South Carolina enacted temporary moratoria on the use of eminent domain for oil pipelines.

At the national level, natural gas companies granted licenses to construct pipelines by FERC have long exercised broad authority to take rights of way using the eminent domain power under the Natural Gas Act. This year, however, pipeline opponents have filed lawsuits in federal district court challenging the use of eminent domain to construct the proposed Mountain Valley and Atlantic Coast natural gas pipelines. The litigation raises the question of whether the use of eminent domain to support these projects violates the “public use” requirement of the Takings Clause, and whether Congress has made an overbroad delegation of the eminent domain power to FERC and in turn to private natural gas companies.

Even while there is growing grassroots and even official opposition to the use of eminent domain to support energy infrastructure development at the state level, some environmentalists and academics point out that success in developing the enormous wind power resources of the upper Midwest will largely depend on the ability of industry and government to transport the power to the eastern United States. Success in achieving that objective may depend on vesting new power in the federal government, including eminent domain authority, to control the siting of electric transmission lines in the face of landowner and possibly state opposition.

In sum, there are important and challenging crosscurrents in the increasingly contentious debates over energy infrastructure siting in the United States.