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Energy bill with federal LNG rules advances
The Associated Press
Governors, mayors and local officials would have little chance to block construction of a liquefied natural gas terminal under an energy bill that advanced May 26 from a Senate committee. (See related story on page 16 of this issue.)
A provision in the bill gives the Federal Energy Regulatory Commission exclusive jurisdiction over final approval of such a terminal. A dozen or more such facilities probably will be built in the next decade.
The Senate Energy and Natural Resources Committee advanced the non-tax portion of the energy legislation by a 21-1 vote. Several lawmakers said contentious issues such as the siting of LNG terminals would have to be settled by the full Senate.
The vote came after Louisiana Gov. Kathleen Blanco and five other coastal-state governors asked senators not to take away states’ role in approving natural gas import terminals.
In a May 25 letter to the energy committee’s chairman and top Democrat, California Gov. Arnold Schwarzenegger and the governors of Massachusetts, Louisiana, Delaware, Rhode Island and New Jersey said states and local agencies should have shared jurisdiction with the federal government over projects on their coasts.
“We support legislation that would provide for concurrent state and federal jurisdiction over LNG and other energy facilities,” said the letter to Sens. Pete Domenici, R-N.M., and Jeff Bingaman, D-N.M. House bill affirms FERC's authority The House has already passed an energy bill affirming FERC’s authority to approve the natural gas import terminals. The provisions passed by the GOP-controlled House “unacceptably pre-empt state and local jurisdiction,” the three Republican and three Democratic governors wrote.
FERC Chairman Patrick Wood said he didn’t think the energy bill language would diminish states’ authority over LNG terminals.
“I don’t see in the energy bill’s LNG language where the states’ robust regulatory authority will be affected, except to set a reasonable and statutorily supported timeline for the states to act,” he told reporters after a commission meeting.
There are now just a handful of LNG import facilities in the United States and companies are trying to build three dozen more.
The Long Beach, Calif., city council on May 24 postponed a vote on a $450 million natural gas terminal proposed by ConocoPhillips and Mitsubishi.
In addition to Schwarzenegger, a Republican, the governors signing the letter were Republicans Mitt Romney of Massachusetts and Donald Carcieri of Rhode Island, and Democrats Blanco of Louisiana, Ruth Ann Minner of Delaware and Richard Codey of New Jersey, the acting governor.
Other items in the legislation approved by the Senate committee include:
• A requirement to double ethanol use in gasoline.
• New rules to ensure the reliability of the nation’s electricity grid.
• Loan guarantees for new, innovative energy technologies such as clean coal gasification plants and new generation nuclear reactors.
Sen. Mary Landrieu, D-La., won approval for an inventory of Outer Continental Shelf oil and gas reserves. This plan is similar to one the Senate approved in energy legislation two years ago.
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