Taking the President (and politics) out of pipeline approval decisions

The “do-nothing” House of Representatives managed to defy expectations again yesterday and actually get something done. A new bill has been passed and sent to the Senate which would remove the requirement for presidential approval of new pipeline construction when the project crosses the borders of either Canada or Mexico. As I’m sure most of you will recall, it was the presidential approval phase which bogged down both Keystone XL and Dakota Access for years while Barack Obama was in office. (Both projects were approved shortly after Donald Trump’s inauguration.) If this manages to make it through the Senate – no easy feat – it will shift responsibility to a different agency. (Bloomberg)

House Republicans moved to make it easier to build pipelines from Mexico or Canada, as they sought to prevent a repeat of President Barack Obama’s drawn out rejection of the Keystone XL pipeline.

The requirement for a presidential permit for pipelines that cross U.S. international borders would be eliminated under the legislation, which was approved by a vote of 254-175 in the House of Representatives. Senate approval is still required before the bill can go to President Donald Trump’s desk, and it faces longer odds there.

“More pipelines need to be built to bring natural gas and oil from where it is produced to the consumers,” House Speaker Paul Ryan said in a statement before the vote.

Obama’s rejection of TransCanada Corp.’s Keystone project, as well as Energy Transfer Partners LP’s Dakota Access Pipeline are “the poster children of this problem,” Ryan said.

Giving up power doesn’t sound like something that Trump (or any president in the modern era) would be wild about, but in this case he might be willing to sign off in the interest of stopping future Democratic presidents from barring development. Under this new plan even more attention would be shifted to the Federal Energy Regulatory Commission (FERC) which we were discussing here recently. That five person, allegedly non-partisan panel would take over final approval much as they already do with domestic pipeline projects.

This is far from a done deal for two obvious reasons, both involving Chuck Schumer. First of all, there’s no way that the Democrats are going to be onboard with anything which makes it even easier to process fossil fuels. They fundraise constantly off their opposition to pipelines, with only a few exceptions from some mostly red, energy producing states. Getting sixty votes may prove impossible and this doesn’t look like a big enough treat to tempt Mitch McConnell into moving any more quickly toward the nuclear option.

But let’s say that it somehow makes it through and onto Trump’s desk. As we discussed in the article linked above, the FERC is, at the moment, completely sidelined. They have one member out of the five who are supposed to be seated and Chuck Schumer hasn’t been in much of a hurry to schedule hearings or hold votes on any of Trump’s nominations. There’s roughly $14B worth of domestic pipeline construction currently on hold until the board can be reformed with a quorum and issue the applicable permits. If there are any pending international pipelines nearing final approval, they will simply be lumped in with that group.

Still, even for all of that, this is a good move if the Senate can somehow get it done. It won’t remove the politics from the process entirely (which is essentially impossible today) but it will streamline it quite a bit. It also won’t mean that all construction work on new projects won’t be immediately cancelled by default every time a Democrat is elected president in the future.

Allahpundit Aug 09, 2022 5:01 PM ET