D.C. Cir. OKs Natural Gas Compression Station in Minisink, N.Y.

By Mark Wilson, Esq. on August 18, 2014 | Last updated on March 21, 2019

To what degree must federal agencies consider alternatives when building energy infrastructure? A little bit, said the D.C. Circuit Court of Appeals on Friday in Minisink Residents for Environmental Preservation and Safety v. FERC. Just because an agency considered an alternative, however, doesn't mean it's obligated to use the alternative.

The Federal Energy Regulation Commission (FERC) approved construction by Millennium Pipeline Company of a natural gas compressor station in Minisink, New York -- a tiny town of 4,490 people about a two hours' drive from New York City. Several Minisink residents weren't too keen about a compressor station and advanced another proposal called the "Wagoner Alternative," which involved building a smaller station seven miles outside of Minisink. The proponents of the Wagoner Alternative claimed it would be better suited to the project than placing the station in the largely residential Minisink. The alternative, however, would require replacing seven miles of pipe -- something the original plan didn't.

Agency Considerations

The FERC was required to consider alternative proposals, which it did. However, after considering the Wagoner Alternative, the FERC decided that its environmental impact and cost were higher than the original plan.

Minisink's only remaining argument was that Millennium had to replace that seven miles of pipe anyway, so it would eventually undertake all the same financial and environmental cost that the FERC rejected in the Wagoner Alternative. The residents of Minisink relied heavily on City of Pittsburgh v. Federal Power Commission for the proposition that, because it could avoid extra costs in the future by using the Wagoner Alternative, Millennium had to use that plan.

The court, however, disagreed. For one thing, unlike in City of Pittsburgh, there was no indication that Millennium intended to upgrade the seven-mile stretch in the near future (Minisink relied on a single slide in a single PowerPoint presentation that the court characterized as "a marketing document" for this claim). Second, the Federal Power Commission in City of Pittsburgh refused to consider the power company's future expansion; here, FERC considered the possibility, but ultimately rejected it as uncertain.

Resting on Reasonableness

The rest of Minisink's claims rested on what they believed to be the FERC's unreasonable analysis of the project. Predictably, the court rejected all of these claims as resting on Minisink's opinion that the FERC didn't assess things like property value impact, cost-benefit analysis, and the obtrusiveness of the compressing station. As it turns out, that FERC did assess all of these things, and did so in a reasonable way -- just not in a way that benefited Minisink.

The citizens of Minisink put in a good effort, but overturning an agency decision requires a showing of more than just "they disagreed with our findings." It's hard to say, on these facts, that the agency's decision to place a compressing station in Minisink was unreasonable. With more natural gas pipelines going in around the country, this certainly won't be the last challenge to an FERC plan.

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