[00:00:03] Speaker ?: Case number 17-1271 at L. Appalachian Voices at L, petitioner vs. Hunterwood Community Regulatory Commission. [00:00:10] Speaker 03: Mr. Luckett for the petitioner, Ms. [00:00:12] Speaker 03: Perry for the respondent, and Mr. O'Neill for the interveners. [00:01:19] Speaker 03: May it please the Court, my name is Ben Luckett and I represent the Petitioners. [00:01:23] Speaker 03: I'd like to reserve three minutes of my time for rebuttal. [00:01:27] Speaker 03: FERC asked this Court to bless an approach to reviewing pipeline certificate applications whereby a producer of gas can guarantee that its project will be approved every time without offering any extrinsic evidence of the public need for the pipeline's additional capacity. [00:01:45] Speaker 03: All a company needs to do to secure approval for a pipeline [00:01:49] Speaker 03: It wants to build, and with it, the extraordinary power to take and permanently alter private property, is create a corporate affiliate to propose the project, and then enter into contracts for pipeline capacity with that affiliate. [00:02:05] Speaker 03: Moreover, FERC asks this court to allow it to authorize Mountain Valley to immediately take and alter private property along the more than 300-mile pipeline route. [00:02:25] Speaker 03: before landowners can raise their statutory and constitutional objections to the taking. [00:02:30] Speaker 03: It also asks that it be allowed to authorize pipeline construction before completing mandatory review of potential measures to protect important historic properties and without ever meaningfully analyzing the project's substantial impacts to the climate and water quality. [00:02:46] Speaker 03: This Court must reject Firt's request because it is contrary to the Natural Gas Act, NEPA, the National Historic Preservation Act, and the Fifth Amendment to the U.S. [00:02:55] Speaker 03: Constitution. [00:02:58] Speaker 03: The Natural Gas Act prohibits the construction of a pipeline and must Firt reasonably find that it is required by the public convenience and necessity. [00:03:07] Speaker 03: But in practice, FERC reads the words required, public, and necessity out of the statute altogether, and instead authorizes construction of any pipeline that is merely desired by a private entity willing to speculate that it will ultimately be able to find a market for its gas. [00:03:25] Speaker 03: That approach is contrary to the statute and to FERC's own certificate policy statement and is threatening... Aren't there contracts for 100% of the gas? [00:03:35] Speaker 03: Yes, Your Honor, all of those contracts, however, are with affiliates of the pipeline developer. [00:03:41] Speaker 05: Right, but still they're contracts to buy the gas, right? [00:03:45] Speaker 03: Yes, Your Honor, they are. [00:03:46] Speaker 03: However... [00:03:49] Speaker 03: As expert studies submitted into the record as well as Commissioner Glick's dissent explain, contracts between affiliates are not the result of the same sort of arm's length negotiations that would indicate market demand. [00:04:04] Speaker 05: Is there some evidence that these are not legitimate contracts? [00:04:08] Speaker 03: Well, the fact that the ultimate destination for more than 80 percent of the gas was unknown at the time that the contracts were entered into tends to demonstrate that there is a lack of public demand, or at least that such public demand has not been demonstrated. [00:04:23] Speaker 02: Why would they enter those contracts if they were not at least convinced that there wasn't going to be a market? [00:04:32] Speaker 02: Well, Your Honor, they may very... These are not captives. [00:04:35] Speaker 02: In fact, they were the creators. [00:04:36] Speaker 02: These are not subsidiaries of the [00:04:39] Speaker 02: Why would they contract to buy the passage that they're contracting for if they were not aware of a market for the gas? [00:04:52] Speaker 03: Speculation, Your Honor, that a market will in time develop. [00:04:56] Speaker 03: And I think that given the grant of the extraordinary power of eminent domain here, FERC has to do more than... So it's not an extraordinary power, it's a power that's there in [00:05:08] Speaker 02: all the pipeline cases that we hear. [00:05:11] Speaker 03: Yes, yes, Your Honor. [00:05:12] Speaker 03: But FERC has a responsibility to the public in granting that power. [00:05:17] Speaker 03: And FERC, in order to determine, again, according with the statutory language, that these pipelines are required by the public convenience and necessity, I believe that they have to do more than simply rely on the speculation of a private entity. [00:05:33] Speaker 02: It says it has to be a retail market to create convenience and necessity. [00:05:38] Speaker 02: This is a market, a wholesale part of the market, essentially, but it is a market to the five corporations who have contracted to buy 100% of the gas. [00:05:49] Speaker 03: These are the shippers that have contracted. [00:05:52] Speaker 02: These are not end users who have... Yeah, they're not end users. [00:05:55] Speaker 02: That's why I'm calling them wholesalers, because that essentially is the comparison to the pre-market entities upon which this would all be based if it weren't for the regulations. [00:06:07] Speaker 02: But they are purchasers. [00:06:08] Speaker 02: They are buyers. [00:06:09] Speaker 02: They are creating a demand for that gas that's passing through the pipeline. [00:06:15] Speaker 02: So is there any reason why shippers couldn't be considered the market for purposes of convenience and necessity? [00:06:23] Speaker 03: I think under the facts of this case and the evidence that was present in the record here, it was unreasonable for FERC to rely exclusively on those agreements. [00:06:32] Speaker 02: When we come back then to the arbitrary and capricious standard as governing what we're [00:06:38] Speaker 03: Yes, Your Honor. [00:06:40] Speaker 03: Petitioners do not dispute that in some cases precedent agreements by themselves may be adequate evidence of public benefits of a pipeline. [00:06:48] Speaker 00: So why is it unreasonable? [00:06:50] Speaker 00: FERC says these are legally binding contracts. [00:06:56] Speaker 00: Affiliates are not. [00:06:57] Speaker 00: They're legally binding contracts and it wouldn't make any economic sense for the shippers to [00:07:07] Speaker 00: enter into them unless they thought the gas would have use. [00:07:14] Speaker 00: And they're putting skin in the game, which tends to show that they're making their best judgment about future demand. [00:07:22] Speaker 00: It doesn't seem unreasonable. [00:07:25] Speaker 03: I believe it is unreasonable to defer its analysis entirely to the willingness of [00:07:32] Speaker 03: these particular entities to enter into those contracts under the facts of this case, where we have expert reviews in the record showing that there is already sufficient capacity in the region to be served by the pipeline and that, in fact, that doesn't even include new pipelines serving the same region that FERC has since approved, such as the Atlantic Coast Pipeline. [00:07:57] Speaker 03: And as other studies submitted into the record show, there is a threat of a significant overbuild of the takeaway capacity from the Marcellus region. [00:08:06] Speaker 03: And I think heightened scrutiny of those affiliated agreements was particularly necessary in this instance because of one of that expert evidence in the record to which FERC did not meaningfully respond. [00:08:19] Speaker 03: They pointed out in petitioner's study [00:08:22] Speaker 03: but didn't analyze how that flaw would specifically affect the conclusions. [00:08:27] Speaker 03: So it was particularly important for them to give higher scrutiny given the adverse effects to landowners and communities of this substantial pipeline. [00:08:38] Speaker 03: that we're on the other side of the balancing test that FERC performs to determine whether a project is in the public convenience and necessity. [00:08:46] Speaker 03: That's something that sets this case apart from some of the other precedent of this court where they have allowed precedent agreements to demonstrate public need. [00:08:57] Speaker 03: There was no eminent domain, certainly not the substantial amount of eminent domain along this 300 mile pipeline route in those other cases. [00:09:08] Speaker 05: MR TONER, you can use your oral argument time any way you want, but you've raised at least 16 different arguments in your briefs. [00:09:16] Speaker 05: Are there other issues that you want to emphasize here today that you want us to pay special attention to? [00:09:23] Speaker 03: Yes, Your Honor. [00:09:24] Speaker 05: And is downstream greenhouse gas emissions one of them? [00:09:28] Speaker 03: It is. [00:09:30] Speaker 03: FERC's NEPA analysis was fatally flawed because it failed to meaningfully analyze the substantial impacts of the project on climate as well as water quality. [00:09:41] Speaker 05: What about its analysis of the downstream greenhouse gas effects under the natural gas act? [00:09:48] Speaker 03: Well, it refused to do any analysis of those downstream effects. [00:09:52] Speaker 03: It refused to take these downstream emissions into account when doing its public interest balancing under the Natural Gas Act in what can only be seen as thumbing its nose. [00:10:02] Speaker 05: And so here's my question for you about that. [00:10:05] Speaker 05: As I understand the Commission's [00:10:09] Speaker 05: position on that. [00:10:10] Speaker 05: It said that the downstream emissions were not reasonably foreseeable because it doesn't yet know who the customers are. [00:10:20] Speaker 05: And you challenge that in your brief. [00:10:23] Speaker 05: And you argue that in addition to [00:10:26] Speaker 05: considering then the commission should have used as a methodology for doing it to social cost of carbon, right? [00:10:32] Speaker 03: Yes, Your Honor. [00:10:33] Speaker 03: That's your honor. [00:10:33] Speaker 03: Okay. [00:10:33] Speaker 03: There's some available tool, one of which is the social cost of carbon. [00:10:36] Speaker 05: Well, do you recommend any other tool? [00:10:39] Speaker 05: Social cost of carbon was the only one I saw in your brief. [00:10:41] Speaker 03: Yes, that is the one that other agencies have deemed useful and FERC has even admitted are useful for other agencies. [00:10:48] Speaker 05: Okay. [00:10:48] Speaker 05: So my question is this. [00:10:50] Speaker 05: It's true that the commission said we don't have to consider these downstream effects [00:10:55] Speaker 05: And, you know, you make a good argument that that may be wrong. [00:10:59] Speaker 05: But the commission did explain in considerable detail why the social cost of carbon wasn't a particularly useful tool here. [00:11:09] Speaker 05: It gave – it said there's no consensus about the discount rate. [00:11:16] Speaker 05: It said that the tool doesn't measure actual incremental effect. [00:11:22] Speaker 05: It said that there's no established threshold. [00:11:26] Speaker 05: It said that, you know, it wasn't quantitative. [00:11:30] Speaker 05: They gave all these reasons. [00:11:33] Speaker 05: But I didn't see anywhere in your brief where you challenged any of them, in your opening brief. [00:11:38] Speaker 05: Did I miss something? [00:11:41] Speaker 03: This may have been primarily in the reply brief. [00:11:43] Speaker 05: Well, that's why I asked you about the opening brief. [00:11:46] Speaker 03: Yeah. [00:11:46] Speaker 03: Yes, sir. [00:11:47] Speaker 05: You see why I'm asking the question? [00:11:49] Speaker 05: The reason I'm asking the question is that even if you're right, if you think this perception of the case is wrong, you should speak up. [00:11:58] Speaker 05: But even if you're right that the commission was wrong when it said the downstream greenhouse gas emissions are not reasonably foreseeable, even if you're right about that, the only technique you've suggested [00:12:20] Speaker 05: for evaluating the significance of those emissions is the social cost of carbon. [00:12:25] Speaker 05: The commission explained in detail why it didn't think it would work, and you didn't respond. [00:12:31] Speaker 05: So my question is, why isn't that whole argument forfeited by you? [00:12:38] Speaker 05: In other words, we don't have a basis for setting this aside, because you only argue for the social cost of carbon, and you didn't challenge the commission's reasons for not using it. [00:12:51] Speaker 05: In the opening brief? [00:12:54] Speaker 03: Yeah. [00:12:55] Speaker 03: Well, when the – we argued that they should have used the symbol. [00:12:58] Speaker 05: And the dissent, which was particularly surprising because the dissenting commissioner spent quite a bit of time explaining why those reasons weren't legitimate. [00:13:11] Speaker 05: But you didn't argue it in your [00:13:14] Speaker 03: But as you mentioned, Your Honor, there were 16 separate arguments to be included in this brief, and space was allocated. [00:13:22] Speaker 05: Well, but you know the rules of this court. [00:13:26] Speaker 05: I mean, you have to make your arguments in your opening brief. [00:13:29] Speaker 05: Otherwise, they're forfeit. [00:13:32] Speaker 03: I believe even without the social cost of carbon, the fact that FERC failed to consider them indirect effects, even without the further step of monetarily quantifying those effects, even if they had just admitted, yes, these two billion feet a day, yes, cubic feet a day. [00:13:51] Speaker 05: Well, it did do that, didn't it? [00:13:52] Speaker 05: It did what we required them to do in Sierra Club, right? [00:13:57] Speaker 05: the emissions. [00:13:58] Speaker 05: I thought your major objection was that it never considered the significance of it, right? [00:14:04] Speaker 03: Also that it failed to consider them as an indirect effect. [00:14:07] Speaker 03: It first said that it was not going to take these emissions into account as part of its decision making. [00:14:15] Speaker 03: And so even if they were to disclose a full burn estimate, but then on the other hand they say, but in fact those emissions [00:14:23] Speaker 03: are not a reasonably foreseeable cause result of this project approval, that is fundamental. [00:14:34] Speaker 03: Unless that they actually consider those emissions as an effect of the project, then the purposes of NEPA are not served. [00:14:41] Speaker 00: Purposes of NEPA are to generate information to inform the agency's decision making and public scrutiny. [00:14:53] Speaker 00: right, doesn't compel one outcome or another. [00:14:59] Speaker 00: And on the question of what information they generated in the EIS, the same reaction as Judge Tatel, which is one case says they must quantify the amount of CO2 emissions from downstream burning, and another case says that they don't have to go [00:15:22] Speaker 00: the next step and try to predict what impact that CO2 emission will have on climate change and somehow try to monetize the present value of that. [00:15:36] Speaker 00: So they generated all the information that we said they have to and they didn't generate a separate set of information that we've said they don't have to. [00:15:48] Speaker 03: I think the failure is their failure to actually use that information. [00:15:52] Speaker 03: They said explicitly that they did not believe it was an indirect effect of the project and could not deny a pipeline on the basis of those emissions. [00:16:01] Speaker 03: So regardless of disclosing that information, that's one purpose of NEPA. [00:16:05] Speaker 03: The other purpose is to actually inform the decision making. [00:16:08] Speaker 03: And FERC has been explicit that its calculation of greenhouse gas emissions did not inform its decision making as NEPA requires. [00:16:19] Speaker 05: May it please the court, Lona Perry for the Commission. [00:16:35] Speaker 04: With regard to the issue of need, the Commission reasonably determined – this Court has repeatedly held that the Commission can use precedent agreements as evidence of demand for a public convenience to necessity finding. [00:16:48] Speaker 04: And in this case, the only thing that was different about this issue was the fact that the contracting parties happened to be affiliates, and the Commission reasonably concluded that, given the fact that those affiliates were at risk for the cost of that capacity, [00:17:04] Speaker 04: under their 20-year long-term contracts that they would not have reasonably entered into those contracts without an anticipation of there being demand ultimately for the gas that they were transporting on the pipeline. [00:17:19] Speaker 04: With regard to the greenhouse gas emissions, the commission also, as it pointed out in its orders, did what this court required it to do in the 2017 Sierra Club decision and calculated the greenhouse gas emissions and also compared those greenhouse gas emissions to national and to regional inventories. [00:17:45] Speaker 04: And this court in Sierra Club did not require the further step of trying to link those greenhouse gas emissions to actual climate change impacts. [00:18:00] Speaker 04: And the commission reasonably concluded [00:18:02] Speaker 04: that it had no way of doing that because the tools for that simply don't exist. [00:18:08] Speaker 04: The social cost of carbon tool was not appropriate, and there was no other way to give significance to the figure to determine whether or not the project was unacceptable because of the greenhouse gas emissions. [00:18:23] Speaker 05: So I want to be totally sure I understand the Commission's reasoning here. [00:18:30] Speaker 05: You're right about what the commission said about the social cost of carbon. [00:18:36] Speaker 05: Explain why I didn't think it was a useful tool. [00:18:38] Speaker 05: But there was an antecedent discussion, which had to do with whether the downstream greenhouse gas effects were reasonably foreseeable. [00:18:48] Speaker 05: And the commission said they were not. [00:18:51] Speaker 05: Right? [00:18:51] Speaker 04: That's right, Your Honor. [00:18:53] Speaker 05: And of course, the dissent says, well, wait a minute. [00:18:59] Speaker 05: What sense does that make? [00:19:04] Speaker 05: It's true, the case is a little different from Sierra Club because we don't know who the customers are, but as you just said, 100 percent of this is covered by contracts. [00:19:15] Speaker 05: That gas is going to be burned and it's going to emit greenhouse gases, correct? [00:19:21] Speaker 05: Right, Your Honor, and I think if you look actually – So what difference does it make that we don't know at this very moment who the downstream customers are? [00:19:32] Speaker 05: As you just said, the Commission based its public interest determination on the fact that there was 100 percent demand for it. [00:19:40] Speaker 04: I think if you look at note 814 in the rehearing order, which is in the Joint Appendix at 1926, the Commission there explains that while the burning of the gas might ultimately be foreseeable, what the Commission lacks is any information regarding [00:19:58] Speaker 04: where the gas is going in the sense of whether it would result in increased consumption versus will it be substituted for other existing sources and will that be coal, will that be other gas? [00:20:10] Speaker 05: On the substitution question, we said in Sierra Club, [00:20:13] Speaker 05: Commission's free to make that argument, a document, and if it wants but it's got to show that that's in fact a possibility, that's not in here. [00:20:21] Speaker 05: There's nothing in here. [00:20:22] Speaker 04: Well, that's the problem, Your Honor, is the Commission says because we don't know where the end use of this gas is going to be, we aren't able to make that calculation. [00:20:29] Speaker 05: But what the Air Club says is you can't, the Commission can't rely on that without documenting it. [00:20:34] Speaker 05: And as the dissent said, I mean, you don't – the commission has no doubt that this gas is going to be burned, and this isn't like ozone or another pollutant which – whose effects as local greenhouse gases – greenhouse gases, we all know, go immediately to the upper atmosphere wherever they're burned. [00:20:55] Speaker 04: So, you know – Yes, Your Honor, but the situation here, as the environmental impact statement said, the alternative [00:21:02] Speaker 04: fuel in this region is coal. [00:21:05] Speaker 04: And so to the extent that you are talking about what the gas is substituting for and who is going to be burning it, it can make a great deal of difference in terms of the net amount of greenhouse gases that are produced. [00:21:17] Speaker 05: Sure, but none of that analysis is in here. [00:21:19] Speaker 05: I'm sorry, Your Honor. [00:21:20] Speaker 05: I didn't see that. [00:21:22] Speaker 05: I know the Commission said that. [00:21:24] Speaker 04: Well, right. [00:21:24] Speaker 05: But there isn't any actual analysis of any of that data. [00:21:27] Speaker 04: Well, exactly, because the Commission said because they didn't know where the gas was going. [00:21:32] Speaker 05: Well, that's my point. [00:21:34] Speaker 05: You haven't explained to me why, yet, at least explain to me, why the dissenter isn't right about the fact that this [00:21:43] Speaker 05: What the dissenter says in here is that the commission should have just assumed, since it's covered by, since 100 percent of the transmission is covered by contracts, that all that gas, every molecule of that gas will be burned, and those molecules will produce greenhouse gases. [00:22:04] Speaker 05: Next question should be, okay, maybe the greenhouse gases produced by that will be far less [00:22:13] Speaker 05: than alternatives, which would produce X, but there's none of that in the order. [00:22:18] Speaker 04: Right, because the Commission didn't feel like it had the information necessary to make that determination. [00:22:22] Speaker 05: Okay, all right, all right. [00:22:23] Speaker 05: We're going in circles. [00:22:24] Speaker 05: Let me ask you a second interval. [00:22:26] Speaker 05: Go ahead. [00:22:27] Speaker 04: Oh, I'm sorry. [00:22:27] Speaker 04: I was just going to point out, Your Honor, that the Commission specifically pointed out the fact that it complied with the Sierra Club decision and made the calculations that were required, and they also pointed out in rehearing order at note 769 [00:22:42] Speaker 04: 1914 of your joint appendix, that even if they are wrong about it being whether or not it is foreseeable, the Commission's discussion in these orders and in the environmental impact statement complied with the CEP procedures for inadequate and missing information. [00:22:58] Speaker 04: Right. [00:22:59] Speaker 04: I understand that. [00:22:59] Speaker 05: I mean, you heard my questions to Mr. Lockett. [00:23:01] Speaker 05: I mean, I get that point. [00:23:02] Speaker 04: Right. [00:23:03] Speaker 04: Yes, yes, Your Honor. [00:23:04] Speaker 04: I just think that I get it. [00:23:04] Speaker 05: But let me ask you a second question. [00:23:06] Speaker 05: This relates to this. [00:23:08] Speaker 05: The intervener makes an argument that [00:23:11] Speaker 05: considering downstream greenhouse gas effects is not even within the Commission's jurisdiction under the National Gas Act. [00:23:18] Speaker 05: And the Commission mentions that a couple times in the tour, but am I reading the Commission decision correctly if I said the Commission's reasoning is one, these were not reasonably foreseeable, and number two, even if they were, there's no real effective tool [00:23:41] Speaker 05: for evaluating their significance. [00:23:44] Speaker 04: Is that right? [00:23:44] Speaker 04: That's right, Your Honor. [00:23:45] Speaker 04: Yes, Your Honor. [00:23:45] Speaker 05: In other words, I didn't read the Commission as saying, we don't even have statutory jurisdiction to consider this. [00:23:52] Speaker 04: Right? [00:23:52] Speaker 04: Oh, no. [00:23:53] Speaker 04: Am I right about that? [00:23:54] Speaker 04: I think that the only discussion that had anything to do with that was the Commission talking about, if it's not within the scope of its NEPA obligations, did it have some independent duty to look at greenhouse gases if it wasn't within the scope of its NEPA obligations? [00:24:09] Speaker 04: But that was the only [00:24:10] Speaker 05: Well, has the Commission held that in any other cases? [00:24:14] Speaker 05: Are there any Commission decisions where the Commission says that environmental issues are beyond its jurisdiction under the Natural Gas Act, when it does the balancing of public interest versus adverse effects? [00:24:30] Speaker 04: No, Your Honor. [00:24:31] Speaker 04: It hasn't ruled that, right? [00:24:32] Speaker 04: No, Your Honor. [00:24:32] Speaker 04: I mean, the description of the balancing is it looks first at the environment, at the economic effects, and then if that balancing works out, then it goes on to look at the environmental effects. [00:24:43] Speaker 04: But that is the balancing process. [00:24:45] Speaker 05: You mean under NEPA? [00:24:45] Speaker 04: Yes. [00:24:46] Speaker 04: Well, under the environmental effects under NEPA, but it's all... Are so under the Natural Gas Act? [00:24:51] Speaker 05: In other words, could the Commission deny a certificate because of adverse environmental effects? [00:24:58] Speaker 05: Has the commission ever ruled one way or another on that issue? [00:25:01] Speaker 04: Well, certainly this court has said in Sierra Club that the commission could deny the certificate if it found that the environmental impacts were so severe. [00:25:15] Speaker 05: Right. [00:25:16] Speaker 05: OK, great. [00:25:16] Speaker 05: That's very helpful. [00:25:17] Speaker 04: Any further questions? [00:25:20] Speaker 04: Thank you. [00:25:22] Speaker 05: OK, we'll hear from the intervener, Mr. [00:25:29] Speaker 01: May it please the Court, my name is Brian O'Neill, and I'm appearing this morning on behalf of the respondent interveners in this proceeding. [00:25:40] Speaker 01: Judge Tatel, with respect to the downstream greenhouse gas emissions issue, I think you understand, but it's important that... Don't assume I understand anything. [00:25:54] Speaker 01: Thank you. [00:25:54] Speaker 01: Just explain it. [00:25:57] Speaker 01: This case is significantly different than the Sable Trail case, the Sierra Club case, the so-called Sable Trail case. [00:26:07] Speaker 01: Without conceding the causation part of the equation here, in Sable Trail, this court concluded that it was reasonably foreseeable to determine where the gas was going to – where the end use was going to be. [00:26:24] Speaker 01: It was going to be at power plants, in Florida, identifiable power plants. [00:26:28] Speaker 01: And that's just not the case here. [00:26:30] Speaker 05: But why? [00:26:31] Speaker 01: Why? [00:26:32] Speaker 01: Because while you're correct, Your Honor, that gas is... You don't have any doubt that this is all going to be burned, correct? [00:26:41] Speaker 01: Well, it could be used for some chemical or feedstock purpose. [00:26:44] Speaker 01: There could be some that wasn't burned at all. [00:26:47] Speaker 01: We don't know. [00:26:48] Speaker 01: We could all go with that, I guess. [00:26:51] Speaker 01: What we don't know is whether [00:26:54] Speaker 01: some of this or all of it will be used to offset the burning of other fuels such as coal and fuel oil. [00:27:02] Speaker 01: We don't know whether some of it will be for new demand or some of it will be to replace existing demand for competitive purposes. [00:27:10] Speaker 01: We just don't know. [00:27:11] Speaker 01: No one knows. [00:27:13] Speaker 01: The Commission doesn't know. [00:27:14] Speaker 01: It didn't do an analysis because it doesn't know where it's going. [00:27:16] Speaker 01: No one does. [00:27:17] Speaker 01: And in addition, I point out that under the Commission's rules, [00:27:22] Speaker 01: The shippers of the gas here can have the ability to release capacity when they're not using it. [00:27:28] Speaker 01: They can release capacity on an interim basis. [00:27:31] Speaker 01: They can release their capacity on a long-term basis to third-party shippers. [00:27:35] Speaker 01: We don't know who those third-party shippers would be. [00:27:37] Speaker 01: We don't know where the gas would go if those third parties were shipping the gas. [00:27:41] Speaker 01: So the commission – the point here is the commission did distinguish this case from Sabre Trail. [00:27:48] Speaker 01: And it went a step farther, however. [00:27:51] Speaker 01: The FERC – without conceding the causation factor, the FERC did provide a quantitative estimate, and then it put that in context, comparing it to regional and national numbers. [00:28:07] Speaker 01: So the commission's decision is readily defensible. [00:28:11] Speaker 01: Finally, I put my two cents worth here on the need factor. [00:28:15] Speaker 01: On the what factor? [00:28:16] Speaker 01: The need. [00:28:17] Speaker 01: The commission concluded that this project is in the public convenience of necessity and is needed. [00:28:22] Speaker 01: And it's needed because there are six contracts with six separate shippers for the entire capacity of this project. [00:28:31] Speaker 01: And these are not insubstantial shippers. [00:28:34] Speaker 01: These are – it's not the Acme Haunting Company here. [00:28:38] Speaker 01: These are people who are willing to risk substantial amounts of money. [00:28:43] Speaker 01: And that's – the commission has concluded, consistent with its policies and precedent, that that is an adequate indication of need. [00:28:51] Speaker 05: Okay. [00:28:51] Speaker 05: Thank you. [00:28:52] Speaker 01: Thank you, Your Honor. [00:28:54] Speaker 05: Mr. Lockett, you are out of time, but we'll give you two minutes. [00:29:02] Speaker 03: On the social cost of carbon issue, I'd just like to point out first that petitioners in their opening brief did fault FERC for admitting that that tool is appropriate for use by other agencies in their project level reviews, similar to this review, and for failing to explain why that was different. [00:29:26] Speaker 03: And the only explanation that FERC offered [00:29:30] Speaker 03: was that it was not the legally relevant cause of the emissions and that these other agencies that had used this tool before appropriately were in fact the legally relevant cause. [00:29:43] Speaker 03: And of course that claim that FERC here is not the legally relevant cause is what this court rejected in Sierra Club. [00:29:53] Speaker 03: And so that all of the other critiques of the social cost of carbon really fall away when we see that FERC admits that it is useful for other agencies but is only not useful because of a reason that this court explicitly rejected in Sierra Club. [00:30:17] Speaker 03: Now, FERC also said – appeared to say FERC's counsel when it was up here that it does indeed consider environmental effects even when not explicitly part of its NEPA analysis. [00:30:30] Speaker 03: It considers those in its Natural Gas Act balancing. [00:30:34] Speaker 03: But FERC said precisely the opposite of that in the Dominion transportation case that petitioners cited on page 49 of their brief. [00:30:43] Speaker 03: where it said that FERC does not consider environmental effects outside of its NEPA analysis. [00:30:50] Speaker 03: And I'd just like to conclude by saying that if indeed FERC's argument about not being the legally relevant cause of the emissions and that all of this gas would be burned anyways, that the shippers would find different ways to get their gas to markets, if that fact is true, it of course severely undermines their finding of public convenience and necessity. [00:31:13] Speaker 05: Thank you, case is submitted. [00:31:17] Speaker 05: Stand please.