[00:00:01] Speaker 00:
Case number 23-1174, Ed Al, City of Port Isabel, Ed Al, Petitioners, versus Federal Energy Regulatory Commission.

[00:00:10] Speaker 00:
And case number 23-1175, Ed Al, City of Port Isabel and Sierra Club, Petitioners, versus Federal Energy Regulatory Commission.

[00:00:20] Speaker 00:
Mr. Matthews for the petitioners, Mr. Kennedy for the respondents, Ms.

[00:00:24] Speaker 00:
Chila Kemary for intravenor Rio Grande LNG, Mr. Pincus for intravenor Texas LNG Brownsville.

[00:00:32] Speaker 02:
Good morning, Council.

[00:00:34] Speaker 02:
Mr. Matthews, please proceed when you're ready.

[00:00:37] Speaker 05:
Good morning, Your Honors, and may it please the Court.

[00:00:39] Speaker 05:
Nathan Matthews on behalf of Petitioners Pecino, City of Port Isabel, Sierra Club, and the Criza Concrudo tribe of Texas.

[00:00:47] Speaker 05:
FERC failed to respond to either issue from this Court's 2021 remand.

[00:00:51] Speaker 05:
On greenhouse gases, this Court held that 40 CFR 1502.21 apparently required FERC to use the social cost of carbon as a method generally accepted in the scientific community

[00:01:01] Speaker 05:
notwithstanding FERC's criticisms of the tool.

[00:01:05] Speaker 05:
But on remand, FERC ignored that notwithstanding and really repeated concerns about the tool without addressing whether or not it was generally accepted in the scientific community.

[00:01:13] Speaker 05:
And on environmental justice, FERC has again provided an analysis of disproportionate and adverse impacts on environmental justice communities that is not connected to FERC's analysis of actual impacts.

[00:01:26] Speaker 05:
Beyond those issues, FERC's analysis of new information introduced new errors, and FERC violated NEPA by reauthorizing the projects on the basis of new analysis without providing any additional NEPA process.

[00:01:37] Speaker 05:
So there are a lot of issues in this case.

[00:01:40] Speaker 05:
I plan to begin by talking about four of them, but I'm happy to redirect you on any issues that the court wants to discuss.

[00:01:46] Speaker 07:
Just beginning with the environmental statement where you suggested there ought to be a supplement.

[00:01:52] Speaker 07:
Under a normal process, you could submit a draft out for comment, receive the comments back, and then go to a final environmental statement, right?

[00:02:02] Speaker 07:
That's correct, Your Honor.

[00:02:03] Speaker 07:
And so what is so different here in that even if there's new information that's received during that comment period, it doesn't mean that when you put your final statement out, you should just go ahead and explain it, but you didn't have to go and ask for further comment about the comments that came in.

[00:02:20] Speaker 05:
So I may have misunderstood the question, Your Honor.

[00:02:24] Speaker 07:
Because what I'm just saying, you have a draft that goes out.

[00:02:26] Speaker 07:
It receives comments.

[00:02:28] Speaker 07:
Then FERC goes and addresses those comments before it puts out its final draft.

[00:02:33] Speaker 07:
During that comment period, it might receive new information.

[00:02:36] Speaker 07:
But that doesn't mean you then submit it, put out another comment period.

[00:02:39] Speaker 07:
You can just go and deal with the comments in the draft.

[00:02:43] Speaker 05:
There are circumstances where if things proceed as you describe, the final environmental impact statement can change relative to the draft.

[00:02:52] Speaker 05:
I mean, the whole point is that it may change in response to comments without needing to do a new draft.

[00:02:57] Speaker 05:
The regulations do contemplate that at some point the changes are so much that you would need to do a new draft.

[00:03:00] Speaker 07:
And I guess that's what I'm trying to get at is it can be a very intractable process in the sense that as long as the comments are addressed within that final draft,

[00:03:12] Speaker 07:
You don't have to, every time there's new information come out, then put it out for more comments.

[00:03:18] Speaker 05:
So I agree with you how that can work when there is a draft environmental impact statement.

[00:03:24] Speaker 05:
The main distinguishing factor here is that there was no draft.

[00:03:29] Speaker 05:
FERC, after the remand in 2021, did not put out any draft of FERC's own analysis for comment.

[00:03:36] Speaker 05:
All that FERC put out was a solicitation for some comments on a subset of the applicant's submissions.

[00:03:44] Speaker 05:
That fell short of, you know, it was not the equivalent of a draft supplemental environment.

[00:03:50] Speaker 07:
Everybody got the opportunity to comment.

[00:03:52] Speaker 07:
Do you have any evidence about some wished to and they didn't feel like they had that due process ability?

[00:03:59] Speaker 05:
Yeah, we feel like we didn't have that adequate opportunity for a number of reasons.

[00:04:04] Speaker 05:
One is that FERC didn't ask for comments on everything that FERC actually relied on.

[00:04:08] Speaker 05:
So for example, FERC's comment solicitation didn't identify the demographic information that FERC actually relied on in its environmental justice analysis.

[00:04:18] Speaker 05:
It's also, NEPA is very clear that the agency is supposed to provide its own analysis, that we're not supposed to comment on the applicant submissions, but that FERC needs to, or any agency,

[00:04:29] Speaker 05:
needs to take a first pass at explaining whether it agrees with the applicant submissions, pass its own judgment, and then we can comment on that.

[00:04:38] Speaker 05:
Again, there was material that just wasn't included in the comment solicitation.

[00:04:44] Speaker 05:
We only had 21 days to comment, whereas the NEPA regulations require a minimum of 45 days for comments on supplemental environmental impact statement.

[00:04:50] Speaker 05:
And frankly, if we'd had twice as much time, we could have done much more.

[00:04:55] Speaker 05:
with our in-house resources, and we frankly couldn't hire an expert with 21 Days, but we could have hired an expert to help us digest this material if we'd had 45.

[00:05:02] Speaker 03:
Council, the threshold question for whether an SEIS is required is whether there's new information that paints a seriously different picture.

[00:05:10] Speaker 03:
And as I understand it, what FERC is saying is, yes, we redid the EJ analysis with a 50 kilometer radius instead of a two mile radius.

[00:05:20] Speaker 03:
But at the end of the day, it was based on effectively the same or very similar emissions data that was already out there.

[00:05:28] Speaker 03:
And it's not a case where we've identified some new threat that's a significant threat to any of these communities.

[00:05:38] Speaker 03:
You know, yes, it's different, but it's not a seriously different picture in the way our cases contemplate.

[00:05:44] Speaker 05:
So I have three responses to that argument.

[00:05:46] Speaker 05:
One is that on FERC's new analysis about environmental justice communities, FERC's prior analysis said that there was just nothing to worry about there.

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FERC had said,

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there would be no environmental justice community that would suffer disproportionate and adverse impacts.

[00:06:00] Speaker 05:
And on remand, FERC says that not only will there be disproportionate and adverse impacts, but that hundreds of census blocks will have environmental justice communities who suffer impacts that FERC says rise to the level of being disproportionate and adverse.

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And in Vecinos, this court upheld FERC's analysis of

[00:06:21] Speaker 05:
the actual air quality impacts, but said FERC's conclusion as to whether or not those impacts are disproportionate or adverse could change FERC's ultimate decision about whether or not the projects are consistent with public interests.

[00:06:33] Speaker 05:
So that identifies that the conclusion of not just what the air pollution will be, but whether that air pollution is something you should take seriously and whether it constitutes a disproportionate and adverse impact is a seriously different picture, because as the court has recognized, it may lead to a different outcome.

[00:06:51] Speaker 02:
So you had two other points, and I don't want to hear what those points are, but is your view that FERC had to prepare a supplemental EIS, or is your view that the information was significant enough that FERC had to do more to explain why it wasn't going to prepare a supplemental EIS if it wasn't?

[00:07:15] Speaker 05:
So in this case, our view is that FERC was required to prepare a supplemental EIS.

[00:07:21] Speaker 02:
You're not making the other argument.

[00:07:23] Speaker 02:
You don't think there's an intermediate zone in which there's significant information such that there's some triggering condition for an explanation of whether.

[00:07:37] Speaker 05:
Certainly this court has held that there is a threshold question of whether new information rises to that level.

[00:07:47] Speaker 05:
And I think that,

[00:07:51] Speaker 05:
With the argument about the new finding of disproportionate and adverse impacts, that raises that question.

[00:07:57] Speaker 05:
Some of our other arguments as to why supplemental environmental impact statement is required, I don't think implicate that, which is why I think we can possibly skip past it here.

[00:08:04] Speaker 05:
Another one of our arguments is that insofar as FERC is relying on new analysis, independent of whether it reaches a different conclusion,

[00:08:15] Speaker 05:
that when FERC uses new analysis to cure the NEPA deficiency that was identified in 2021, that that new analysis needs to be presented to the public through the NEPA process.

[00:08:26] Speaker 05:
We don't think that the prior Vecino's decision held that a supplemental environmental impact statement was absolutely required.

[00:08:34] Speaker 05:
The court gave FERC a choice.

[00:08:36] Speaker 05:
The court said there seems to be a

[00:08:39] Speaker 05:
between the scope of your environmental justice analysis and the scope of your environmental effects, I either explain why that's not a problem or do a new analysis.

[00:08:48] Speaker 05:
And on remand, FERC chose the second option.

[00:08:52] Speaker 05:
If there had been something that FERC could have said as to why actually the two kilometer radius and the conclusion of no disproportionate and adverse impacts was defensible, then FERC wouldn't be providing any new conclusions and therefore may not have been required to prepare a supplemental EIS.

[00:09:07] Speaker 05:
But when FERC

[00:09:08] Speaker 05:
Effectively.

[00:09:09] Speaker 03:
That's the second of the third.

[00:09:09] Speaker 03:
That's the second argument.

[00:09:10] Speaker 03:
Yes.

[00:09:11] Speaker 03:
OK.

[00:09:11] Speaker 03:
So what's the third?

[00:09:12] Speaker 05:
And so the second is curing a NEPA deficiency requires new NEPA process.

[00:09:19] Speaker 05:
The third is closely related, which is that when the agency is actually relying on new analysis, independent of whether there was a prior finding of a NEPA deficiency, that that new analysis has to be presented in an EIS.

[00:09:31] Speaker 05:
So this court has a series of cases that have said supplementation is required when there's a seriously different picture.

[00:09:38] Speaker 05:
In every one of those cases, the agency was actually still relying on the analysis in the EIS.

[00:09:43] Speaker 05:
The question was whether there was new information that the agency should have considered.

[00:09:49] Speaker 05:
But this court has never said that an agency can kind of gut the underpinnings of its analysis, put something new in its place, and as long as the end conclusion looks similar, you don't need to provide a public comment or a supplemental EIS.

[00:10:01] Speaker 05:
So here, we're not saying that

[00:10:04] Speaker 05:
We haven't argued that FERC was required to solicit new air emissions data and conduct an entirely new analysis of air pollution.

[00:10:11] Speaker 05:
But once FERC chose to do so and rested its decision to reauthorize this project, a completely new analysis that FERC was required to provide the public with an opportunity to weigh in and not just

[00:10:26] Speaker 05:
NEPA doesn't just say provide the public with some opportunity to comment.

[00:10:29] Speaker 05:
NEPA is a highly structured process of making sure that that comment opportunity is effective.

[00:10:34] Speaker 05:
And FERC had to use that structured NEPA process here.

[00:10:41] Speaker 05:
So if there are more questions about the NEPA supplementation and process claim, I'll just note that the failure to provide NEPA process mattered here.

[00:10:51] Speaker 05:
It can't be dismissed as a harmless error.

[00:10:54] Speaker 05:
It certainly mattered to the hundreds of environmental justice communities that didn't receive any notice that FERC thought that the impacts that they would suffer would rise to the level of being disproportionate and adverse until FERC issued the reauthorization orders, at which time it was too late for non-parties to submit comments or to intervene or anything.

[00:11:14] Speaker 05:
So FERC could put out information about what the

[00:11:18] Speaker 05:
in parts per million what the air quality would be for these communities beforehand.

[00:11:21] Speaker 05:
But FERC didn't tell them they should care until it was too late for them to do anything about it.

[00:11:26] Speaker 05:
And for us, we weren't able to provide as effective comments as we would have if we'd had the 45 days, if we'd had something more robust to comment on.

[00:11:37] Speaker 05:
And if we'd provided those more effective comments, that likely would have influenced FERC's decision making.

[00:11:41] Speaker 05:
Or at least this court can't be certain that it wouldn't

[00:11:43] Speaker 05:
and so the failure to provide adequate process likely influenced the actual outcomes here.

[00:11:53] Speaker 03:
Can I redirect you to the carbon capture?

[00:11:57] Speaker 03:
and sequestration issue.

[00:11:58] Speaker 03:
So I understand the big picture position that you're taking is essentially that once Rio Grande puts this alternative on the table, the process should have essentially halted.

[00:12:12] Speaker 03:
And that it needs to be considered as an alternative to the terminal as is.

[00:12:18] Speaker 03:
And I think what the

[00:12:20] Speaker 03:
I'd like to hear your response to the first thing that FERC says, which is, well, the scope of alternatives to consider was something that became final in 2019, and it was outside the scope of the remand.

[00:12:34] Speaker 03:
And this whole issue is just procedurally barred.

[00:12:38] Speaker 03:
Why isn't that correct?

[00:12:44] Speaker 05:
One answer is that that doesn't address our argument that carbon capture and sequestration is a connected action, which is sort of a, but let me address the alternatives part of that.

[00:12:51] Speaker 03:
Well, can I just ask you about that?

[00:12:53] Speaker 03:
Because it seems to me that it should rise and fall together because if it's a connected action, but you only learn about the second connected action years after the first action was finally approved.

[00:13:04] Speaker 03:
Well, so this is an odd basis to reopen.

[00:13:07] Speaker 05:
I think the fact that Rio Grande positioned this alternative as something that it asked FERC to consider as part of its remand in reconsideration of the terminal itself.

[00:13:19] Speaker 05:
Yes, they started first, but Rio Grande expected them to end at the same time and for it to be considered in parallel.

[00:13:24] Speaker 05:
So I think that that possibly answers that question.

[00:13:27] Speaker 05:
But I think that we also have an alternatives argument separate from the connected action argument.

[00:13:34] Speaker 05:
And what this court held in the 2021 decision was that FERC had failed to address whether the project's greenhouse gas emissions rendered contrary to the public interest for purposes of the Natural Gas Act.

[00:13:47] Speaker 05:
And the Natural Gas Act doesn't just require FERC to give up or down approval as to projects.

[00:13:52] Speaker 05:
FERC has an open-ended authority and an obligation to require modifications of projects when those projects are in the

[00:14:01] Speaker 05:
would be appropriate.

[00:14:02] Speaker 05:
So that's 15 USC 717B sub E. Somewhere under sub E. And so in this case, FERC has never determined that

[00:14:15] Speaker 05:
it would be appropriate to prove this project despite its greenhouse gas emissions, because it hasn't given those emissions a fair consideration.

[00:14:23] Speaker 05:
And as a part of that, FERC hasn't determined whether or not it would be appropriate to require any modifications to address those emissions.

[00:14:32] Speaker 05:
And so once this court remanded, and then on that remand Rio Grande said, hey, we could potentially solve a large part of this problem.

[00:14:39] Speaker 05:
The FERC hasn't already said, we don't need that because we've already decided that the project is OK without it.

[00:14:46] Speaker 05:
This court held, no, FERC, you haven't supported that decision.

[00:14:49] Speaker 05:
So this isn't asking for, maybe to sum that up, our alternatives argument isn't asking FERC to revisit a decision that was already proper and final.

[00:15:00] Speaker 05:
There was no final decision here, and so FERC can't claim that they've kind of capped that off.

[00:15:06] Speaker 02:
Can I ask you, on the carbon capture and sequestration, I know that you have made a point that it's not necessarily unidirectional, that actually there could be some adverse environmental consequences from that too.

[00:15:19] Speaker 02:
But just for assumption purposes, just put that to one side for a second.

[00:15:22] Speaker 02:
Let's suppose that it only points in one direction, that it can only be environmentally beneficial.

[00:15:29] Speaker 02:
If we are in that world, what happens to your argument?

[00:15:35] Speaker 05:
That strongly supports the alternatives argument and possibly undercuts the connected action argument a bit, because the connected action argument is about before you set in motion a chain of events that may have adverse consequences, you need to know what those adverse consequences will be, which is I think why we're concerned about that here.

[00:15:54] Speaker 05:
But even if it's carbon capture, and I have to emphasize

[00:15:58] Speaker 05:
especially certain petitioners strongly resist the premise.

[00:16:02] Speaker 02:
I want to get to that.

[00:16:03] Speaker 02:
I want to get to that.

[00:16:04] Speaker 05:
But if it is, so if there's nothing bad that could possibly come from it, it is less important to make sure that it's considered now rather than later from a connected action perspective.

[00:16:13] Speaker 05:
But from an alternatives perspective, that doesn't really change.

[00:16:17] Speaker 05:
I don't see how that changes anything because the point is still, FERC isn't, it changes the question before FERC, which is not

[00:16:24] Speaker 05:
Is this project going to provide benefits that are so great that we should accept 7.2 million tons per year of greenhouse gas emissions?

[00:16:34] Speaker 05:
Would it better serve the public interest to get those benefits with an alternative that has drastically lower emissions?

[00:16:40] Speaker 05:
And it's an alternative that the applicant proposed.

[00:16:44] Speaker 05:
Our concern is just- They may have withdrawn.

[00:16:47] Speaker 05:
They haven't officially withdrawn it.

[00:16:49] Speaker 05:
They have not provided timely responses.

[00:16:53] Speaker 05:
you go to their website or their investor communications and things, everything that I'm aware of, they continue to hold out that that is what they plan to do.

[00:17:02] Speaker 02:
And then, and can you just on the premise, so give me a quick explanation of what the argument is that there's adverse environmental consequences that flow from

[00:17:14] Speaker 05:
So there are some adverse consequences that are certain.

[00:17:17] Speaker 05:
And we know that once you capture the carbon, it's got to go somewhere and that that's going to need a pipeline.

[00:17:22] Speaker 05:
FERC has told, or the applicants have told us that that's going to be about a 10 mile pipeline.

[00:17:26] Speaker 05:
The project is in the middle of wetlands and a wildlife refuge.

[00:17:28] Speaker 05:
So there's nowhere to put, we don't know which direction the pipeline would go, but every available direction crosses habitat and wetlands and things that petitioners care about.

[00:17:38] Speaker 05:
There are also

[00:17:40] Speaker 05:
issues we don't know as well.

[00:17:43] Speaker 05:
Carbon capture would use an amine process.

[00:17:46] Speaker 05:
We aren't aware of evidence on how much of those amines end up into the air, and what would be the air pollution consequences of that.

[00:17:54] Speaker 05:
So I think that a hard look, this seems like a promising alternative.

[00:17:58] Speaker 05:
We're not sure its benefits are going to outweigh its costs, however.

[00:18:01] Speaker 05:
And so the whole point of NEPA is to address that alternatives have pros and cons, and you've got to do a rigorous exploration to decide whether they're worthwhile.

[00:18:10] Speaker 02:
And can you just help me on alternatives?

[00:18:12] Speaker 02:
So is the way the landscape is set that as long as the agency takes into account reasonable range of alternatives, the requirement is satisfied, even if some alternatives could come up at some point later in the process.

[00:18:31] Speaker 02:
But at some point, there's just a number.

[00:18:32] Speaker 02:
You have to take into account a reasonable range of alternatives, and then you've done that.

[00:18:36] Speaker 02:
So the fact that something happens to come up

[00:18:38] Speaker 02:
at later on in the process doesn't necessarily mean just because it's a possible alternative, it has to be folded into the analysis?

[00:18:44] Speaker 02:
Or is it that every time a possible alternative comes up at some point before the decision is made final, that it has to be folded into the analysis?

[00:18:54] Speaker 05:
So I don't know that alternatives are any different than other new information in that regard.

[00:18:58] Speaker 05:
So I think for, or the agency, you know, would need to address it.

[00:19:02] Speaker 05:
And they could, that may be saying that, you know, this alternative isn't actually all that different from the other alternatives that we considered.

[00:19:09] Speaker 05:
You know, it doesn't need separate or additional discussion or the agency might be able to quickly say, you know what, this alternative is infeasible, so we're going to dismiss it.

[00:19:19] Speaker 05:
Anyway, there are a lot of potential factual scenarios that I think do not apply here, where it's not our alternative.

[00:19:30] Speaker 05:
As the developer explicitly in response to this court's decision said,

[00:19:35] Speaker 05:
You know, this is, we want to do this.

[00:19:37] Speaker 05:
It's technically feasible.

[00:19:38] Speaker 05:
It's economically feasible.

[00:19:40] Speaker 02:
But we're not going to commit to it.

[00:19:42] Speaker 02:
But for purposes of your alternatives argument, as opposed to the connectedness one, I take it it doesn't matter where it comes from.

[00:19:48] Speaker 02:
I mean, the alternative could come up.

[00:19:49] Speaker 02:
It could just be posted on the web by an anonymous contributor.

[00:19:53] Speaker 02:
And still, the question is whether the agency has to take it.

[00:19:56] Speaker 05:
I think that if it comes up by an anonymous contributor, the agency might be able to say, we don't have evidence that this is technically feasible or economically feasible, or there may be

[00:20:04] Speaker 05:
missing facts or facts that it's easier for the agency to say, this doesn't really change the picture.

[00:20:12] Speaker 05:
But because in this case, we aren't concerned about technical or economic feasibility, because at least maybe not conclusively, but facially, the fact that the applicant proposed it demonstrates that this is something that they think could work.

[00:20:29] Speaker 05:
Our claim here is really that then it shouldn't be left

[00:20:33] Speaker 05:
Once the applicant has put that evidence into the record, it should be FERC rather than the applicant who decides whether the public interest is better served by this.

[00:20:42] Speaker 07:
And then I was just going to ask about the Brownsville monitor, the three years worth of data.

[00:20:48] Speaker 07:
Yes.

[00:20:48] Speaker 05:
Yeah, so this is, I think, a little different than a lot of the other claims in this case, because it's not about the conclusions FERC drew.

[00:20:55] Speaker 05:
It's about what the actual impacts will be, how bad the air pollution really will be.

[00:21:02] Speaker 05:
We identified the ISLA Blanca air monitor.

[00:21:05] Speaker 05:
No one in this case disputes that the ISLA Blanca monitor had three years of valid data in January 2023 when the analysis that FERC actually relied on was performed, or that if that data was used, it would indicate an exceedance of the national ambient air quality standards.

[00:21:25] Speaker 05:
So FERC's argument for not using that monitor is to say that we needed at least 36 months of data

[00:21:33] Speaker 05:
But at the time the analysis was performed, there were 39 months available.

[00:21:36] Speaker 05:
FERC hasn't explained why the requirement for 36 months of data matters.

[00:21:42] Speaker 05:
FERC also has this argument that perhaps the Brownsville Monitor is closer to larger environmental justice populations.

[00:21:50] Speaker 05:
And we're not, I mean, fine.

[00:21:52] Speaker 05:
Go ahead and use the Brownsville Monitor for assessing impacts in Brownsville.

[00:21:56] Speaker 05:
But you can't use that to ignore evidence of a more severe impact on the city of Port Isabel and the environmental justice population there.

[00:22:08] Speaker 02:
Does that answer your question?

[00:22:10] Speaker 08:
Yes.

[00:22:11] Speaker 02:
Make sure my colleagues don't have additional questions for you at this time.

[00:22:14] Speaker 02:
We'll give you some time for rebuttal.

[00:22:26] Speaker 06:
I'm going to start where we just left off, Judge Childs, because we do dispute both issues with respect to the monitor.

[00:22:39] Speaker 06:
We do dispute that there were three years of valid data, as the commission explained in its rehearing order.

[00:22:45] Speaker 06:
there's sort of two timing points.

[00:22:48] Speaker 06:
One, the background period that these analyses looked at for Rio was 2019 to 2021.

[00:22:53] Speaker 06:
This monitor didn't start until October 2019.

[00:22:58] Speaker 06:
I believe Texas was 2018 to 2020.

[00:23:02] Speaker 06:
So there's a mismatch there, but there's also a mismatch when the commission looked at the developer submissions, conducted its analysis in early 2003 when it issued the remand order.

[00:23:13] Speaker 06:
By that point,

[00:23:15] Speaker 06:
If you look at the EPA spreadsheets that the commission cites to in the remand orders, the data hadn't been validated and given a thumbs up by the EPA for use.

[00:23:28] Speaker 06:
So in choosing the Brownville monitor and relying on that solely, the commission was following the EPA's modeling guidance that you should use a monitor with three years of validated data.

[00:23:37] Speaker 02:
The second point is that in the remand order, the explanation of what seems to be more than three years actually shouldn't count

[00:23:45] Speaker 06:
So you'll see that in, I'm sorry, the remand rehearing order.

[00:23:49] Speaker 06:
You will see that in paragraph 27, which is JA 189, where it discusses the beginning start date in September, I'm sorry, in October 2019.

[00:24:01] Speaker 06:
And then the EPA spreadsheet,

[00:24:06] Speaker 06:
talking about is reference in footnote 64 there.

[00:24:10] Speaker 06:
And in terms of, you know, the notion that no one disputes that their portrayal of the data, the commission hasn't looked at.

[00:24:19] Speaker 06:
But I would urge you to take a look at that.

[00:24:23] Speaker 06:
at that spreadsheet because it talks about what types of monitors these is the Brownsville monitor is a it listed as one that you use for looking at impacts on population.

[00:24:33] Speaker 06:
While the one at East LeBlanc is is for it says for traffic.

[00:24:37] Speaker 06:
Now the Commission didn't speak about any of this because it didn't look at the data.

[00:24:40] Speaker 06:
But the Commission's other point was

[00:24:42] Speaker 06:
and it cites to a mapping tool the EPA has that, look, what we're interested in here is the impact of these emissions on populations.

[00:24:50] Speaker 06:
Brownsville is in sort of the heart of where most of the EJ communities are.

[00:24:54] Speaker 06:
East LeBlanc is way out on the coast, so we think it's more appropriate to rely on the Brownsville monitor.

[00:25:00] Speaker 06:
And at the end of the day, our position is this is just one of the technical choices that is left up to the agency.

[00:25:07] Speaker 06:
The agency explained itself, and we think its position

[00:25:10] Speaker 06:
is reasonable.

[00:25:11] Speaker 03:
Just on the second reason, why couldn't Burke have used both monitors if there were available data?

[00:25:17] Speaker 06:
Well, if the commission believed that it was appropriate to use it because there was three years worth of validated data, then maybe it would have considered that.

[00:25:26] Speaker 06:
But it never sort of got to that point because there's a threshold.

[00:25:29] Speaker 02:
But then they're not independent.

[00:25:30] Speaker 02:
So in other words, the second one then doesn't stand or fall alone.

[00:25:34] Speaker 02:
It's dependent on the ostensible absence of three years of data.

[00:25:39] Speaker 06:
I think there's two, I think they are independent.

[00:25:42] Speaker 06:
I mean, the commission could have looked at it and said, we have no reason to include this monitor way out on the sea.

[00:25:49] Speaker 06:
We're concerned about what's going to happen in these populations.

[00:25:53] Speaker 02:
Even if it had three years of data?

[00:25:55] Speaker 02:
I think it's possible.

[00:25:56] Speaker 02:
I thought you were just saying in response to Judge Garcia that built into the second rationale is an assumption that there wasn't three years of data.

[00:26:06] Speaker 06:
Well, I guess the commission's point with respect to the location of these, even if East LaVanca was sort of valid for use, there's still a choice that the commission could rationally make that say, no, we're going to focus on the data from Brownsville, because that's where the population center is located.

[00:26:24] Speaker 06:
There's been no citation in the record that's sort of excluding that, even if it had valid data, which it didn't at the time violate some sort of modeling concept.

[00:26:34] Speaker 03:
Do you, the first thing you said just on the three year period was that FERC was insisting on a three year period that was, you know, more dated than 2019 to 2023.

[00:26:46] Speaker 03:
And you gave a citation from the Texas JA.

[00:26:50] Speaker 03:
I'm sorry, but do you have a site in the Rio Grande JA for that?

[00:26:54] Speaker 06:
Oh, I'm sorry.

[00:26:55] Speaker 06:
Did I give the wrong?

[00:26:57] Speaker 06:
So it's the rehearing order in the,

[00:27:05] Speaker 06:
So I'll give you for the Rio case it is paragraph 27 which.

[00:27:10] Speaker 06:
Should be J a one 90 from Rio and then for Texas there's a comparable.

[00:27:19] Speaker 03:
Citation yes and it's a it's a. Maybe seems like a small board point but all that paragraph says is.

[00:27:27] Speaker 03:
is LeBlanc only started in October 2019, and that's not three years of valid data, which on its face makes no sense, because you asked for the data in 2023, 39 months later.

[00:27:39] Speaker 03:
It would be a very good explanation if there was a reason you needed data from before October 2019.

[00:27:45] Speaker 03:
You just don't see that in the orders.

[00:27:48] Speaker 03:
That's the precise.

[00:27:49] Speaker 06:
I think if you look at this paragraph, sorry, that same paragraph in footnote.

[00:27:54] Speaker 06:
Excuse me one second.

[00:27:58] Speaker 02:
classes.

[00:28:00] Speaker 02:
It's 65 that's citing the spreadsheet.

[00:28:02] Speaker 02:
Is that where your footnote's 65?

[00:28:04] Speaker 06:
So there's 63, which cites the EPA regulations regarding that design value should be based on three years worth of data.

[00:28:15] Speaker 06:
So that's sort of the standard that the commission's basing its modeling efforts on.

[00:28:21] Speaker 06:
And then footnote 64, that's the spreadsheet where at the time this was prepared

[00:28:27] Speaker 06:
the Isla Blanca monitor doesn't have a valid, there's a column for sort of when it's validated by, and it's blank because as the petitioner, excuse me, as Rio Grande interveners point out in their brief, that didn't happen until I think May, I think after the remand or hearing orders were issued.

[00:28:46] Speaker 02:
And they're only valid, so a lot of work is being done by the word valid, valid design values, and if you look at the spreadsheet, there's a way to discern that

[00:28:57] Speaker 06:
there was less than years of valid it will it will have a it will have a start date.

[00:29:01] Speaker 06:
And I there's I can't remember the precise title, but it will have a start dates assume it says essentially valid start date.

[00:29:08] Speaker 06:
They don't have an end date.

[00:29:10] Speaker 06:
And the end date for Brownsville.

[00:29:13] Speaker 06:
It's validated.

[00:29:14] Speaker 06:
by a specific date, but for Isla Blanca, it's left blank.

[00:29:17] Speaker 06:
And then you go forward after these orders were issued.

[00:29:20] Speaker 06:
That's when the EPA finally validated the data from this monitor.

[00:29:24] Speaker 06:
I think the Rio Grande intervener site to a later version of the spreadsheet after the commission orders where there now is an end date put in there.

[00:29:37] Speaker 06:
Now, sort of going back to the, unless there's more monitor questions, turning back to the process point, our positions at 15029 governs when a supplemental EIS is required.

[00:29:50] Speaker 06:
This court spoke about the elements of that regulation in the unpublished Casino's opinion.

[00:29:56] Speaker 06:
And it said that a supplemental EIS is required only if new information will affect the quality of the human environment

[00:30:05] Speaker 06:
in a significant manner not already considered.

[00:30:07] Speaker 06:
So there's sort of three touchstones.

[00:30:09] Speaker 06:
New information not already considered.

[00:30:11] Speaker 06:
It has to be significant, and it has to relate to the human environment.

[00:30:14] Speaker 06:
With respect to the commission's air analysis, it looked on remand.

[00:30:19] Speaker 06:
The scope of the analysis on remand matched the scope of the analysis that was performed in the EIS.

[00:30:25] Speaker 06:
Both of them looked out to see what the emissions impact would be on about 250 kilometers.

[00:30:31] Speaker 06:
So there's no new information in that regard.

[00:30:37] Speaker 06:
Is it significant?

[00:30:38] Speaker 06:
The remand analysis showed that there were no max exceedances for any census block within that 50 kilometer radius.

[00:30:47] Speaker 06:
In fact, it showed that the emissions profile for the project actually improved.

[00:30:52] Speaker 06:
The first go round, there was a nitrous oxide exceedance between the fence lines of the two facilities.

[00:30:58] Speaker 06:
That's gone away.

[00:31:00] Speaker 06:
Greenhouse gas emissions have got slashed by about a third.

[00:31:04] Speaker 06:
the ozone profile of the product, the cumulative ozone impacts have decreased significantly.

[00:31:11] Speaker 06:
Pardon me.

[00:31:12] Speaker 06:
And, you know, in rejecting a call for supplemental EIS in the unpublished Vecino's opinion, the court said one of the upheld first decision not to do so because the environmental picture got better.

[00:31:27] Speaker 06:
That's what the new information showed.

[00:31:29] Speaker 06:
Sort of the third component, what is really new here is the demographics of the population between the two mile radius originally looked at and out to 31 miles.

[00:31:40] Speaker 06:
And the CEQ regs define human environment as a natural or physical environment.

[00:31:48] Speaker 06:
The commission said that this sort of demographic data really, that's not what that's talking about.

[00:31:53] Speaker 03:
As the petitioners point out,

[00:31:57] Speaker 03:
the actual bottom line of the environmental justice analysis seems to have flipped.

[00:32:02] Speaker 03:
So it's a little unclear to what extent FERC means this, but certainly the bottom line conclusion before was there are no disproportionate adverse impacts to EJ communities.

[00:32:11] Speaker 03:
And now the conclusion is there are.

[00:32:12] Speaker 03:
And I think that's maybe their best argument for why this is a meaningfully different picture that those communities should have had a chance to comment on.

[00:32:21] Speaker 06:
I think if you take a step back and look at what the commission held

[00:32:24] Speaker 06:
in the authorization orders and looked at what it held here, there's not a substantive difference.

[00:32:29] Speaker 06:
And I think the best place to look at the commission's analysis, the first go round is paragraph 69 of the Rio rehearing order.

[00:32:38] Speaker 06:
There's a similar paragraph in the Texas authorization rehearing order.

[00:32:42] Speaker 06:
And what the commission said, they looked at using its two mile radius.

[00:32:46] Speaker 06:
It said, look, 24 of the 25 census blocks impacted by the Rio project are EJ communities.

[00:32:53] Speaker 06:
I think four to five of the communities surrounding the text facility or EJ communities.

[00:32:59] Speaker 06:
So the community said it's not useful to think about disproportionate impacts on a numerical basis like that because they're bearing all of the impacts.

[00:33:08] Speaker 06:
Let's go to the second step, which is permissible under the commission cited

[00:33:13] Speaker 06:
CEQ guidance in this regard.

[00:33:15] Speaker 06:
Let's go to the second step and see are there any unique factors of those communities that will amplify the impacts to a disproportionate manner as compared to the larger population.

[00:33:26] Speaker 06:
And looking at it there, it concluded that they wouldn't.

[00:33:28] Speaker 06:
That's when it looked through that all the emissions would be below the next level, that there was no

[00:33:35] Speaker 06:
With respect to ozone at the time, they were projecting an exceedance.

[00:33:38] Speaker 06:
There was no unique demographic factors that would make those populations impacted to a greater degree than the larger population.

[00:33:46] Speaker 06:
So the commission recognized numerically these impacts are falling on EJ communities, but they're not expecting to be amplified in any manner, not accounted for here.

[00:33:56] Speaker 06:
The commission sort of, I mean, you get a sense of this in the orders, the commission noted it's

[00:34:00] Speaker 06:
sort of formalized its analysis a bit and has focused more on EJ issues through the years.

[00:34:07] Speaker 06:
So rather than, it made the same analysis that looked at numerically the populations.

[00:34:13] Speaker 06:
And here within the 50 kilometer radius, it's about 97% are EJ communities.

[00:34:18] Speaker 06:
And rather than immediately going to the second, rather than saying, look, all this is hitting EJ communities and going to the second step, it made the conclusion at the top line, excuse me, saying,

[00:34:29] Speaker 06:
there is a disproportionate impact on these communities because they are bearing all of it.

[00:34:33] Speaker 06:
And then it did the same analysis, went to the second step to see, let's see whether there's any underlying issues here that we're not aware of that would make them significant in a manner not already considered.

[00:34:44] Speaker 06:
And the only impact that's been brought up as possibly extending beyond the original two mile radius is air emissions.

[00:34:53] Speaker 06:
And this is the law of the case that the commission is reasonable

[00:34:56] Speaker 06:
in its reliance on the NACS standards to assess, even for sensitive populations, whether those impacts would be significant.

[00:35:04] Speaker 06:
So I agree there has been a little bit of change in language, but substantively I don't believe there's been a change at all.

[00:35:15] Speaker 06:
Oh, carbon capture.

[00:35:17] Speaker 06:
Just to touch on that, as we explained in our brief, we don't think it is a connected action for the reasons identified, timing, substantial independent.

[00:35:27] Speaker 02:
What's the current status of that in the commission's view?

[00:35:30] Speaker 06:
So I looked at the docket earlier this week, and nothing of substance had been posted since we filed our brief.

[00:35:38] Speaker 06:
So I don't think the commission's made any statement that they view it as

[00:35:43] Speaker 06:
off the table or withdrawn, but there has not been any activity since.

[00:35:49] Speaker 06:
since one of the briefs.

[00:35:51] Speaker 02:
It's still active from the commission.

[00:35:52] Speaker 03:
It's still an open docket.

[00:35:54] Speaker 03:
Yes.

[00:35:55] Speaker 03:
The posture of that is that the project applicant could withdraw that at any time.

[00:36:00] Speaker 06:
Correct.

[00:36:00] Speaker 06:
Correct.

[00:36:02] Speaker 06:
With respect to sort of the alternative angle on this, we think it is barred by race judicata principles.

[00:36:08] Speaker 06:
They had an opportunity to raise a challenge and did raise challenges to the commission's alternatives analysis in the AES.

[00:36:14] Speaker 06:
The court ruled upon them

[00:36:15] Speaker 03:
Um and our position one of the fundamental requirements of rescue to cut is that the argument could have been raised before and this was new information Well, I think I'm sorry.

[00:36:25] Speaker 03:
No, no, no this specific proposal I'll just put on the table.

[00:36:29] Speaker 03:
What seems to be quite unique about this It is a proposal by the applicant not some random commenter on the internet for the specific purpose of trying to increase its chance of being reapproved and

[00:36:43] Speaker 03:
And in that situation, it seems to obviously be, at least it's not barred by rest judicata, and it seems a difficult question whether the commission should have just deemed it, you know, time barred when it's the applicant itself introducing it into the process.

[00:37:00] Speaker 03:
Just wondered how you.

[00:37:01] Speaker 06:
Well, what the commission specifically said is the notion that this should be considered as an alternative is beyond the scope of the limited issues remanded to it.

[00:37:11] Speaker 06:
it's appropriate for a separate NEPA process.

[00:37:14] Speaker 06:
There was a schedule until things slowed down.

[00:37:18] Speaker 06:
So the commission's position is not that it will not look at it.

[00:37:23] Speaker 06:
When it's ready to be looked at, the commission will analyze it and make a determination whether the benefits outweigh the costs.

[00:37:32] Speaker 03:
And it seems odd to me that there was still an open proceeding, right?

[00:37:38] Speaker 03:
I understand that there's an argument that it's outside the technical scope of the remand.

[00:37:42] Speaker 03:
But the commission has before a proceeding about whether to approve the terminal as is.

[00:37:48] Speaker 03:
And now there's a proposal on the table to have a terminal plus this system that seems to have a whole lot of environmental benefits.

[00:37:57] Speaker 03:
And the commission's job under NEPA and the Natural Gas Act is to

[00:38:05] Speaker 03:
assess the environmental impacts and make a considered judgment.

[00:38:08] Speaker 03:
It just seems odd to me that the picture seems as though the commission was in more of a hurry to reapprove than the project definitely.

[00:38:16] Speaker 06:
We're not resisting the idea of taking a hard look at this when it's ready to be looked at by any means.

[00:38:21] Speaker 06:
Our position is just limited as a legal matter.

[00:38:24] Speaker 06:
The court ruled on challenges to our alternatives analysis under NEPA and found that it was appropriate.

[00:38:30] Speaker 02:
And I understand this.

[00:38:32] Speaker 02:
If in the remand order, suppose that the court just said,

[00:38:36] Speaker 02:
These are the issues that are gonna be addressed on remand.

[00:38:38] Speaker 02:
Of course, to the extent new information comes to light in the scope of analysis on remand, that information presumably will be taken into account in the ordinary courses the agency typically would do.

[00:38:50] Speaker 02:
If there were that kind of allowance for taking into account new information, then would this proposal have been folded into the existing analysis as opposed to cordoned off as something that would be dealt with in a distinct way?

[00:39:04] Speaker 02:
In other words, is it only the scope of the remand that is the perceived scope of the remand that justifies the agencies not taking account of the carbon proposal as part of the existing procedure?

[00:39:19] Speaker 06:
No, it's the entire process.

[00:39:22] Speaker 06:
I mean, the commission reviewed these.

[00:39:25] Speaker 06:
I'm not going to go into the details, but I'm going to go into the details, but I'm going to go into the details, but I'm going to go into the details, but I'm going to go into the details, but I'm going to go into the details,

[00:39:45] Speaker 06:
It views that process as, but for the issues the court identified as done, and it'll review this as a separate process.

[00:39:55] Speaker 06:
For those reasons, it shouldn't be folded in.

[00:39:57] Speaker 06:
And even there was some reference to the greenhouse gas analysis.

[00:40:01] Speaker 06:
The remand there was just really an APA failure to confront a argument issue rather than determination that the analysis was faulty.

[00:40:13] Speaker 03:
So for the carbon capture, I definitely understand the timing argument.

[00:40:18] Speaker 03:
I just want to understand whether acknowledging this is very much a hypothetical.

[00:40:27] Speaker 03:
If this alternative was on the table during the initial round when you're looking at all the other alternatives, it's certainly something that NEPA would have strongly suggested the commission should take a hard look at as part of the same proceeding, right?

[00:40:40] Speaker 03:
You're not disputing that.

[00:40:42] Speaker 03:
No.

[00:40:43] Speaker 02:
Okay, no.

[00:40:44] Speaker 02:
Then it seems like everything turns on the scope of the remand.

[00:40:46] Speaker 06:
So it is the scope of the remand that's deciding whether... No, again, I think... There was the claim made in the original proceeding that the commission failed to fulfill its obligations under NEPA to review alternatives.

[00:41:00] Speaker 06:
There's no suggestion that this concept, carbon capture, couldn't have been raised and considered at that time.

[00:41:07] Speaker 06:
The court ruled, no, the commission did what it was obligated to do.

[00:41:10] Speaker 02:
Oh, I'm sorry.

[00:41:11] Speaker 02:
By scope of remand, I'm including race judicata.

[00:41:13] Speaker 02:
OK.

[00:41:14] Speaker 02:
Sorry, sorry.

[00:41:14] Speaker 02:
I was not being clear.

[00:41:16] Speaker 02:
So it's the race judicata explanation.

[00:41:19] Speaker 02:
And the race judicata congeals at the time of the remand.

[00:41:21] Speaker 02:
So the explanation for why this wasn't taken into account as part of the existing proceeding is that the commission perceived

[00:41:29] Speaker 02:
the remand to have congealed this kind of challenge as race judicata at this point and can't be revisited as part of this proceeding, so it would have to be considered as in a distinct proceeding.

[00:41:40] Speaker 06:
Well, also the commission thinks it's appropriate to consider it in a distinct proceeding, because do you see the timing issue now that to put everything on hold will just delay a project that the commission has already determined to be in the public interest, even without this proposal?

[00:41:58] Speaker 02:
But if it had never gone up and never been remanded and this had come along at some point, the evaluation could take some time.

[00:42:04] Speaker 02:
And then the intervener comes forward and says, oh, by the way,

[00:42:09] Speaker 02:
we have a new angle on this, we'd like to factor into the mix a carbon sequestration, then I think you would say that the commission then would have taken that into account as part of the existing proceeding.

[00:42:25] Speaker 02:
I'm sorry, Mr. Crinker.

[00:42:26] Speaker 06:
Where is the existing?

[00:42:28] Speaker 06:
If before the commission had finished its environmental analysis, it made a determination.

[00:42:32] Speaker 06:
Yes.

[00:42:32] Speaker 06:
But it has.

[00:42:33] Speaker 06:
There's been a challenge to whether it complied with its obligations under law.

[00:42:37] Speaker 06:
It was found that they did.

[00:42:37] Speaker 06:
And now the commission is exercising its judgment to treat this as a separate proposal.

[00:42:45] Speaker 06:
And we think under the CEQ regs, that's the appropriate way to address this.

[00:42:51] Speaker 02:
And so if there had been a vacate or a remand rather than just a remand, then definitely would have been taken into account as part of the proceeding.

[00:42:59] Speaker 02:
I guess it wouldn't even be a continuation of the same proceeding if there was a vacate or there'd be a new proceeding, and it would have been folded into that.

[00:43:07] Speaker 06:
I'm thinking through here.

[00:43:08] Speaker 06:
I mean, there still would have been a ruling on alternatives, whether that would survive the vacator.

[00:43:17] Speaker 06:
I haven't thought that deeply about it.

[00:43:20] Speaker 06:
But fundamentally, that is our point.

[00:43:23] Speaker 06:
We fulfilled our obligation to consider alternatives.

[00:43:26] Speaker 06:
Nothing in the regs requires us to open this up and treat it as a connected action or anything like that.

[00:43:33] Speaker 06:
So we believe the commission recently found that when it's ready to move forward, it will be analyzed to the fullest extent.

[00:43:40] Speaker 07:
Go ahead.

[00:43:41] Speaker 07:
Are you still on that?

[00:43:42] Speaker 03:
I just had one last question.

[00:43:44] Speaker 03:
So on the connected action point,

[00:43:47] Speaker 03:
Is it your position that the scope of the remand issue, does that affect the connected action question?

[00:43:55] Speaker 03:
Or is that your position is sort of we just do an up and down assessment of is this properly judged a connected action?

[00:44:05] Speaker 03:
I think it's the latter.

[00:44:06] Speaker 06:
I mean, I think what the commission explained here is connected action is something you look at in the scoping process.

[00:44:14] Speaker 06:
That took place in 2015, 2016 when we began the environmental analysis.

[00:44:22] Speaker 06:
And second, the other concern, the other part of it is substantial independent utility.

[00:44:29] Speaker 06:
The regs talk about interdependence, and here it's clear that the terminal can go forward without it.

[00:44:36] Speaker 06:
And then again, the policy concern underlying all this is looking at it separately, going to mask some environmental impact that the commission didn't have when it made its initial decision.

[00:44:48] Speaker 06:
And I haven't heard any suggestion.

[00:44:49] Speaker 06:
I understand the points about the

[00:44:52] Speaker 06:
impacts that this will have on its own, but I don't have any, I haven't heard an argument that it somehow masks issues that the commission should have considered previously.

[00:45:04] Speaker 07:
Social cost of carbon.

[00:45:07] Speaker 07:
Okay.

[00:45:08] Speaker 07:
Just so that we can get to that particular topic.

[00:45:11] Speaker 07:
The remand asks you to address that specifically.

[00:45:17] Speaker 07:
Your response seems to be, we don't believe that it's scientifically valid.

[00:45:22] Speaker 07:
despite that there have been other communities, and what I mean by that, other agencies, land, environmental, et cetera, that do believe it's valid.

[00:45:32] Speaker 07:
So one of your responses would be, it's not scientifically valid, so you don't address it, or that issue, you're to address it.

[00:45:40] Speaker 07:
The other one seems to be, well, there's no standardized

[00:45:44] Speaker 07:
method in terms of a way to look at the data, in terms of how high emissions should be or what climate change, what's too much in that regard.

[00:45:55] Speaker 07:
But the EPA, at least recently in its commenting period in 2022, suggests that you should look at this as scientifically valid as opposed to just opposing it.

[00:46:06] Speaker 07:
So I'm just trying to get a sense of you all don't put forward an expert that says it's not, but then the other side puts forward

[00:46:13] Speaker 07:
that you have responded to the remain appropriately in that regard.

[00:46:21] Speaker 06:
Yes.

[00:46:22] Speaker 06:
Um you know, the commission identified three reasons why it didn't think it was, um.

[00:46:28] Speaker 06:
Scientifically accepted, and I think it's important to go back to the beginning of the rag.

[00:46:32] Speaker 06:
It deals with missing information.

[00:46:33] Speaker 06:
So what is the information the commission needs here?

[00:46:36] Speaker 06:
It is the extent to which this

[00:46:43] Speaker 06:
the impact of climate change and the impact of climate change on what those impacts will be.

[00:46:50] Speaker 06:
The commission noted first the.

[00:46:52] Speaker 06:
And I'll get your points about the other agencies, but the commission noted first the dispute about the discount rate.

[00:46:59] Speaker 06:
This court noted in

[00:47:02] Speaker 06:
A lack of scientific acceptance and in terms of whether that supported, I would point the court to this is the Rio J. A. Believe it's also in the Texas J. A.

[00:47:09] Speaker 06:
243, which is the technical support doc for the for the tool, and it says the choice of discount rate.

[00:47:17] Speaker 06:
raises highly contested and exceedingly difficult questions of science, economics, philosophy, and law.

[00:47:22] Speaker 06:
So I think on the first point, the record and the case law supports the commission's position that with respect to the discount rate, which is integral to the tool, that there's not a general consensus in the scientific community.

[00:47:34] Speaker 06:
The second point that the commission made, and this kind of gets into what the other agencies do, is that this tool was developed for rulemaking specifically.

[00:47:46] Speaker 06:
And there's no dispute about that.

[00:47:48] Speaker 06:
What we're talking about here is sort of off-label use in a way.

[00:47:51] Speaker 06:
And what the commission said in the Florida Southeast Proceeding, which is a stable trail remand, is the reason it's not appropriate for specific projects is because it puts a big number on the table, which considers damage to agriculture in the future.

[00:48:09] Speaker 06:
the way the economy changes, political upheaval even, but there's nothing, we don't look at the benefits of the project in that same stark dollar sense average.

[00:48:18] Speaker 06:
There's qualitative considerations that the commission does to look at the

[00:48:23] Speaker 06:
You see some of the issues talked about in the original authorization order, how this affects international trade.

[00:48:29] Speaker 06:
Obviously, energy is key to foreign policy and the like.

[00:48:33] Speaker 06:
There's also economic benefits that aren't really tallied down to the dollar.

[00:48:37] Speaker 06:
So it gives a distorted picture when you try and use it for this purpose, looking at one project.

[00:48:43] Speaker 06:
site to these other agencies, I think it's footnote eight of Sierra Club's brief, at least in Rio, they cite the three.

[00:48:50] Speaker 06:
And two of those are three agencies that are using, two of them are programmatic EISs.

[00:48:55] Speaker 06:
And what that means is the agency's looking at four different possibilities for, I believe it's drilling or, anyway, four different proposals.

[00:49:05] Speaker 06:
And it's just, OK, let's put the cost of carbon on all those.

[00:49:09] Speaker 06:
That's sort of a fair comparison.

[00:49:12] Speaker 06:
The commission hasn't taken the position that's not appropriate for rulemakings and things of that light, where you're just looking at the number and just on that basis alone kind of see whether out of these three,

[00:49:29] Speaker 06:
This one has the lowest dollar value, so we're not disputing this could be appropriate in that circumstance.

[00:49:35] Speaker 06:
The other agencies, you know, they point to the fact that the commission cited in the Mountain Valley decision two other agencies who had used it.

[00:49:43] Speaker 06:
And, you know, one of them, the time has moved on, but one of them was a draft EIS from the Bureau of Ocean Energy Management.

[00:49:52] Speaker 06:
I think I could only find the final EIS now.

[00:49:55] Speaker 06:
And it has language just like the commission has here.

[00:49:57] Speaker 06:
It did put the number on the table, but it said it's not useful in the NEPA context, more appropriate in rulemaking.

[00:50:05] Speaker 06:
There's no sort of standard that the BRIO used in that case to make an up or down call as a significant.

[00:50:13] Speaker 06:
So I think the fact that it is used in some contexts for other agencies, or maybe even used

[00:50:20] Speaker 06:
sort of the same manner the commission did here, doesn't establish that it's scientifically accepted for this purpose.

[00:50:28] Speaker 06:
And as to the EPA, I mean, the commission pointed out in the new guidance regarding, and this sort of goes to the third point about the lack of a significance threshold that the commission pointed out in the latest guidance, no one made the call as to what that should be.

[00:50:45] Speaker 06:
So the commission found it's not appropriate for it just to sort of make up a number, particularly

[00:50:50] Speaker 06:
in a case that's on remand to address a regulation that talks about generally accepted scientific methodologies.

[00:50:58] Speaker 06:
And I think the court's other

[00:51:00] Speaker 06:
You know, the line of cases that the court has issued with respect to social cost of carbon support the position, particularly Alabama.

[00:51:08] Speaker 06:
Once you get to that point, the commission acted reasonably in declining to use that to assess significance.

[00:51:14] Speaker 03:
Is it your understanding that no other agency has used social cost of carbon to make a NEPA significance determination?

[00:51:21] Speaker 06:
I have not seen it.

[00:51:23] Speaker 06:
Yes, that's my understanding.

[00:51:24] Speaker 06:
With the prides that I haven't taken a comprehensive view.

[00:51:28] Speaker 06:
No one has pointed one to your attention.

[00:51:30] Speaker 03:
Yes.

[00:51:30] Speaker 06:
I mean, the commission has made this again.

[00:51:32] Speaker 06:
This isn't obviously not the first time this has come up.

[00:51:34] Speaker 06:
And the commission again and again has said, you know, we're not aware of any study or threshold that's out there.

[00:51:41] Speaker 06:
And the court has repeatedly held in the absence of that, the commission is acting reasonably in doing what it does.

[00:51:46] Speaker 03:
Can you just say a little bit more about the distinction between project level and rulemaking?

[00:51:51] Speaker 03:
Because when you say, well, in a rulemaking, we can talk about the costs and then weigh them against the benefits of a project, I suppose, or of a rule.

[00:52:02] Speaker 03:
And the assumption seems to be you can't do the same thing for a project.

[00:52:06] Speaker 03:
And my question is simply, why not?

[00:52:09] Speaker 06:
Well, because you are so with the rulemaking, you're looking at three, you know, courses of action, say, and say, one of the things we want to look at is climate change impacts.

[00:52:19] Speaker 06:
And you can run the numbers for each one and you just see, OK, which is the least and that if that.

[00:52:28] Speaker 06:
That's your primary consideration.

[00:52:29] Speaker 06:
You choose that.

[00:52:30] Speaker 06:
With a particular project, we're not choosing among, at this point now, we're not choosing among alternatives.

[00:52:36] Speaker 06:
We're looking at a proposal and what the tool does is put a dollar value on every conceivable negative climate related negative externality.

[00:52:47] Speaker 06:
And what the commission's point is, that's not helpful because

[00:52:50] Speaker 06:
that distorts the analysis because we're not doing the same thing for the benefits.

[00:52:55] Speaker 06:
We're not tying the benefits down to the dollar for these projects.

[00:52:59] Speaker 06:
There's an integrated assessment model for climate impacts.

[00:53:04] Speaker 06:
There's no integrated assessment model for the benefits of energy.

[00:53:07] Speaker 06:
So it provides a distorted picture when you look at it that way.

[00:53:11] Speaker 07:
But is some of that a policy judgment?

[00:53:15] Speaker 06:
Well, I mean, it is

[00:53:20] Speaker 06:
Is the commission's determination that it's distorts its analysis?

[00:53:26] Speaker 06:
Yes.

[00:53:27] Speaker 07:
And when you look at the threshold issues, that some of that might be a policy judgment.

[00:53:31] Speaker 06:
The commission's explaining why using the off-brand use of social cost of carbon is not appropriate, why it distorts its analysis.

[00:53:39] Speaker 06:
Again, scientific, getting back to sort of generally accepted,

[00:53:43] Speaker 06:
could be for rulemaking.

[00:53:44] Speaker 06:
So the commission, as the court noted in the first senior's opinion, the commission has chosen not to dispute that.

[00:53:49] Speaker 06:
We're certainly not.

[00:53:50] Speaker 06:
It's just this particular context.

[00:53:53] Speaker 06:
And again, I think that goes back to the purpose of this regulation, which is to supply missing information to answer the questions before the agency and the question in a project-specific analysis categorically different from a rulemaking.

[00:54:10] Speaker 02:
My colleagues don't have additional questions.

[00:54:13] Speaker 03:
One other one other question.

[00:54:17] Speaker 03:
This is the issue about how you agency articulated the air pollution conclusions in the environmental justice analysis.

[00:54:26] Speaker 03:
The petitioners seize on some seemingly conflicting statements in your brief.

[00:54:33] Speaker 03:
I don't know if you know what argument I'm referring to.

[00:54:36] Speaker 03:
The SIL argument?

[00:54:37] Speaker 03:
I think it's about, just at a high level, in some places you say, we're using the NACs or the SIL to determine whether an effect is disproportionate and adverse.

[00:54:50] Speaker 03:
And we find there's no new NACS exceedances.

[00:54:53] Speaker 03:
But then in other places, you seem to say there are disproportionate and adverse impacts, air pollution impacts.

[00:55:01] Speaker 03:
And we're left unclear to know just what you mean when you say there's disproportionate and adverse air pollution impacts.

[00:55:07] Speaker 03:
Sure.

[00:55:07] Speaker 06:
So I think there's kind of two issues.

[00:55:11] Speaker 06:
And I'll get to the one.

[00:55:12] Speaker 06:
Again, as to disproportionate impacts, the commission's conclusion is that

[00:55:19] Speaker 06:
The project impacts, the whole suite of them will fall on environmental justice communities disproportionately.

[00:55:26] Speaker 06:
They make up 97% of the affected area.

[00:55:30] Speaker 06:
They will bear the brunt of these, but they will not be with respect to the particular resource, the environmental resources that matter.

[00:55:39] Speaker 06:
that are relevant, they will not be material apart from cumulative visual impacts.

[00:55:44] Speaker 06:
That's because for each census block within that 50 kilometer region, we've modeled it, and it's shown that there will not be a NACC exceedance, and the NACC is designed to protect even sensitive populations.

[00:56:00] Speaker 06:
As to the sort of the purported confusion about the SIL issue.

[00:56:05] Speaker 06:
So what the commission said there

[00:56:08] Speaker 06:
it referenced that to say, to sort of give assurance that the 50 kilometer radius is sufficient.

[00:56:16] Speaker 06:
It's saying, I don't want to get too deep into CIL because I'll get over my skis, but it's saying, it's a tool the EPA uses for modeling.

[00:56:25] Speaker 06:
And it says, if there is a

[00:56:29] Speaker 06:
exceedance of the sill, then you have to do some, if you're below it, you can presume not to have a, you can sort of stop your analysis, but if you're above it, then you have to do a cumulative impacts analysis for that particular criteria.

[00:56:42] Speaker 06:
Make the point that the commission required the developers on both projects to do a cumulative impact air analysis for all criteria pollutants, regardless of what, regardless of any sill issue.

[00:56:53] Speaker 06:
So we were over-inclusive.

[00:56:55] Speaker 06:
When the commission referenced that everything dropped below the significant impact level at 12 kilometers, it was just to give assurance that we're not missing anything, that the 50 kilometers is sufficient to make sure we capture all the impacts that could fall on these communities.

[00:57:11] Speaker 07:
Well, just to piggyback on that then, what would be your response about, was there a fair opportunity for comment, knowing that that was your analysis about the substantial impact?

[00:57:22] Speaker 06:
Yes, I mean, I think it's important to go back to the beginning and you see the Commission points this out in the early parts of its remand orders when it talks about environmental justice.

[00:57:33] Speaker 06:
There's sort of two notice points.

[00:57:34] Speaker 06:
You want people who are going to be affected.

[00:57:36] Speaker 06:
A, you want to notify people that this project is coming.

[00:57:39] Speaker 06:
They could be affected.

[00:57:40] Speaker 06:
B, you want to hear from them and give them the opportunity to raise any issues that they think is pertinent.

[00:57:47] Speaker 06:
When this began,

[00:57:49] Speaker 06:
The developers on their own and the commission as well did extensive outreach in the community well beyond the two mile radius that the commission ultimately looked at in the EIS and gave people that had Spanish speakers there, gave people notice that the project was coming, an opportunity to provide comments.

[00:58:08] Speaker 06:
The EIS sort of lists how many comments they got.

[00:58:11] Speaker 06:
So there was certainly an opportunity for people to bring issues to bear.

[00:58:14] Speaker 06:
And then sort of notice, the draft EIS, the final EIS noted that there could be air impacts out to 50 kilometers.

[00:58:23] Speaker 06:
And that document was widely distributed.

[00:58:27] Speaker 06:
The mailing list for these is in the JAs.

[00:58:30] Speaker 06:
And there are federal, state, local, city officials who were put on notice about that there's potential for impacts there from the very start.

[00:58:41] Speaker 06:
And we also think the

[00:58:44] Speaker 06:
I guess our analytical position is, if it's not required by 1502.9, then this is beside the point as a legal matter, because there's no claim that this didn't satisfy due process or anything like that.

[00:59:00] Speaker 06:
But the goal of this is to make sure everyone knows this is coming and they have an opportunity to raise issues.

[00:59:07] Speaker 06:
And that was satisfied.

[00:59:08] Speaker 06:
at the front.

[00:59:09] Speaker 06:
And then there was extensive comment opportunities.

[00:59:11] Speaker 06:
And it did its job.

[00:59:12] Speaker 06:
The models were revised in response to Sierra Club's comments.

[00:59:17] Speaker 06:
Sierra Club's comments came in after the 21-day period.

[00:59:21] Speaker 06:
So the complaints, I think, about timing sort of fall flat.

[00:59:24] Speaker 06:
There was no comment that was rejected because it was out of time or anything like that.

[00:59:29] Speaker 06:
Certainly, there were some the commission chose not to address because they didn't go to the issues on remand.

[00:59:34] Speaker 06:
But I think there was a fulsome process here.

[00:59:39] Speaker 06:
and it's satisfied to give notice and an opportunity for comment to all these communities.

[00:59:44] Speaker 03:
I just want to make sure I understand the position on the

[00:59:48] Speaker 03:
the need for the SEIS and what changed from the prior analysis to the new one.

[00:59:53] Speaker 03:
And I understand you to basically be saying, yes, it looks like our bottom line conclusion changed because before we said no disproportionate impacts.

[01:00:03] Speaker 03:
And now we say, yes, there are disproportionate impacts.

[01:00:06] Speaker 03:
But that's not because the emission analysis changed in a material way.

[01:00:11] Speaker 03:
It's just because we decided the second time around

[01:00:15] Speaker 03:
call it disproportionate if it's falling almost exclusively on minority communities?

[01:00:21] Speaker 03:
Correct.

[01:00:22] Speaker 06:
The emission profile only got better on remand.

[01:00:25] Speaker 06:
In both the authorization orders and remand, the commission did a two-step analysis.

[01:00:29] Speaker 06:
Numerical, let's look at how far these project impacts.

[01:00:34] Speaker 06:
Let's look at sort of the percentages of the community, EJ communities, upon whom these impacts fall.

[01:00:41] Speaker 06:
commission said it's 100% essentially the first go around.

[01:00:44] Speaker 06:
So why are we even talking about that?

[01:00:45] Speaker 06:
Let's look at, let's, we're going to base our disproportionate impact analysis on the qualitative assessment of how those resources will interact with these communities.

[01:00:54] Speaker 06:
It did that same step here, but it just, it made the same analysis here.

[01:00:59] Speaker 06:
It made the numerical call top.

[01:01:01] Speaker 06:
That's the disproportionate impact.

[01:01:03] Speaker 06:
And then it looked at the qualitatively and assessing whether they would be significant.

[01:01:07] Speaker 06:
Okay.

[01:01:07] Speaker 06:
Thank you.

[01:01:09] Speaker 02:
Thank you, council.

[01:01:10] Speaker 02:
Thank you, your honors.

[01:01:12] Speaker 02:
I'll hear from first interveners.

[01:01:14] Speaker 02:
Council now.

[01:01:22] Speaker 02:
Ms.

[01:01:23] Speaker 02:
Chilikumari.

[01:01:32] Speaker 01:
Good morning.

[01:01:33] Speaker 01:
May it please the court.

[01:01:34] Speaker 01:
Viru Chilikumari for the industry interveners for the Rio Grande Project.

[01:01:37] Speaker 01:
I'd like to touch on the Isla Blanca monitor first, if I can, and then turn to curb and capture.

[01:01:42] Speaker 01:
On the Isla Blanca monitor, this is within the core discretion of FERC in terms of picking the technical issue of picking a monitor.

[01:01:50] Speaker 01:
In FERC's brief, in FERC's rehearing order, they specifically the footnote that

[01:01:55] Speaker 01:
Mr. Kennedy pointed to, it does cite to the ISLA Blanca, the design value data spreadsheet EPA's website.

[01:02:01] Speaker 01:
If you go to that website, it tells you that the AQS data retrieval date was May 22nd, 2023.

[01:02:07] Speaker 01:
So that was the time when EPA validated and published the data.

[01:02:12] Speaker 01:
I know in the reply, the petitioners argue that while the data was out there and FERC could have done the job of averaging out the data to get this three-year value that they could have used.

[01:02:23] Speaker 01:
But that's actually, it's not simply a road calculation of data.

[01:02:28] Speaker 01:
The FERC's rehearing order cites to the EPA regulation.

[01:02:32] Speaker 01:
This is at

[01:02:33] Speaker 01:
189, note 63, and this is the EPA regulation that talks about how they do design value monitoring data to figure out what the background value should be.

[01:02:43] Speaker 01:
That's 40 CFR, part 50, appendix N, 4.1.

[01:02:47] Speaker 01:
And if you look at that regulation, subsection C and D, that tells you that when the EPA takes this data, when they take the three years to figure out what the

[01:02:56] Speaker 01:
what the established background rates should be, they actually exercise judgment.

[01:03:00] Speaker 01:
They don't just average out three years, but they take into account exceptional weather events.

[01:03:04] Speaker 01:
They take into account whether there was faulty data.

[01:03:06] Speaker 01:
So EPA, it's important that EPA validates that data.

[01:03:09] Speaker 01:
And it's completely reasonable for FERC to wait until you have three years worth of data that is published and validated by EPA.

[01:03:18] Speaker 03:
So when the petitioners say,

[01:03:22] Speaker 03:
Fork asked for this data on January 6, 2023, and that's 39 months after Isla Blanca was online.

[01:03:31] Speaker 03:
The point is that the only existing validated data, according to this footnote, was up to what date?

[01:03:39] Speaker 01:
The validated data was from

[01:03:41] Speaker 01:
I don't know the date that it was existing, but the 2019 to 2023 data didn't come online until May of 2023.

[01:03:50] Speaker 01:
I'm sorry, October.

[01:03:52] Speaker 01:
So the data that is LeBlanc, the three years that they're looking at is October 2019 to October 2022.

[01:03:58] Speaker 01:
That data wasn't published by EPA until May of 2023.

[01:04:04] Speaker 01:
and the rehearing and remand order.

[01:04:06] Speaker 01:
And even if the rehearing order came afterwards, but as we say in our brief, there is a valid reason to have a cutoff date when an agency is looking at data.

[01:04:16] Speaker 01:
It is entirely reasonable for FERC to use that.

[01:04:21] Speaker 01:
And I don't think it is disputed.

[01:04:22] Speaker 01:
Petitioners have not disputed that the data was not validated and published by EPA until, in our footnote as we explained in our brief, May of 2023.

[01:04:30] Speaker 02:
Is it only validated when it's published?

[01:04:34] Speaker 01:
Once it's published by EPA on the website, it's in Berks footnote.

[01:04:39] Speaker 01:
They're on footnote 65 of JA 190.

[01:04:41] Speaker 02:
So publication, the way you're understanding it, is the key date.

[01:04:46] Speaker 01:
Yes.

[01:04:48] Speaker 01:
And that's because EPA, again, doesn't store road calculation.

[01:04:51] Speaker 01:
It exercises judgment when it's concluding what data points it should use.

[01:04:57] Speaker 03:
That isn't necessarily a question for you, but do you understand the frustration that none of this is explained in the order itself?

[01:05:04] Speaker 03:
You know, we're talking about.

[01:05:08] Speaker 03:
seems like secret knowledge that you have about what these links say.

[01:05:14] Speaker 01:
I appreciate that, Your Honor.

[01:05:15] Speaker 01:
I think that the footnote, if you look at the EPA website that FERC cites to, it does have a spreadsheet where it has data retrieval dates.

[01:05:23] Speaker 01:
And you can see that it's May of 2023.

[01:05:27] Speaker 01:
But FERC also provided the additional reason that the monitor in Brownsville was closer to EJ communities.

[01:05:33] Speaker 01:
and that the Isla Blanca monitor is in a non-EJ area on an island.

[01:05:37] Speaker 01:
And so we think that's within the core discretion for it to choose which monitor it's going to use.

[01:05:48] Speaker 01:
If there's no other questions on the monitor,

[01:05:53] Speaker 01:
Happy to turn to the carbon capture issue.

[01:05:55] Speaker 01:
So I think it's important to note that the project has been authorized.

[01:05:59] Speaker 01:
It's been authorized for over four years in terms of the construction construction has been going on for six months.

[01:06:05] Speaker 01:
There's a final investment decision here of $18 billion.

[01:06:08] Speaker 01:
You have 750 workers, mostly locally hired on site.

[01:06:11] Speaker 01:
So the terminal project is well underway.

[01:06:15] Speaker 01:
The carbon capture application was a voluntary application that was put forth by the developers.

[01:06:22] Speaker 01:
The developers very much want to go forward with that.

[01:06:23] Speaker 01:
That's a live application.

[01:06:25] Speaker 01:
But it is in no way connected.

[01:06:26] Speaker 01:
And the terminal project is not contingent on that CCS application.

[01:06:31] Speaker 01:
The terminal project will go forward with or without that project.

[01:06:36] Speaker 07:
I want to.

[01:06:36] Speaker 07:
But the carbon capture project has no function alone, right?

[01:06:41] Speaker 01:
The carbon capture project.

[01:06:42] Speaker 01:
We don't dispute that the carbon capture project is dependent.

[01:06:45] Speaker 01:
But what we are arguing is that the terminal project, which is now temporally and functionally independent, is well on its way.

[01:06:52] Speaker 01:
And it is going to go forward with or without carbon capture, with or without, depending on how FERC handles the application.

[01:06:59] Speaker 07:
Judge Srinivasan, I did want to go standard bilateral dependence or

[01:07:04] Speaker 01:
unilateral yes this independent yes our view is that this the bilateral independence is not required and i think it's there's been no rule that that bilateral independence is required in the dc circuit the the second circuit has a very clear case on this the hudson river sloop case that's 836 f second 760 second circuit it was cited in first brief that very clearly has a situation where

[01:07:30] Speaker 01:
You had a port for a battleship was being built.

[01:07:33] Speaker 01:
And then you had a project for housing for families who would go to the port.

[01:07:36] Speaker 01:
The project for housing was very clearly a dependent on the port.

[01:07:40] Speaker 01:
And the court said, we're just going to look at the port.

[01:07:43] Speaker 01:
It is itself independent.

[01:07:44] Speaker 01:
Just like here, the terminal project is independent.

[01:07:47] Speaker 01:
And the fact that you might have a sub-project here that's dependent doesn't hold up the first project.

[01:07:55] Speaker 01:
I did want to get to your question about the timing of the earlier remand and whether or not that means that it reopens the entire scope.

[01:08:06] Speaker 01:
I think petitioners are arguing a couple of different reasons why the carbon capture project should somehow ensnare the larger project.

[01:08:13] Speaker 01:
First, they argue that it's a new alternative.

[01:08:15] Speaker 01:
That we think was clearly is barred by the first basinos judgment.

[01:08:20] Speaker 01:
In addition, when you look at the rules for supplementation, 40 CFR 1502.93, those are the rules that tell you when you have to supplement the EIS.

[01:08:30] Speaker 01:
That actually says exclusive of scoping.

[01:08:32] Speaker 01:
So we think that the initial decision of when you're doing the EIS, you're figuring out your alternatives, that ship has sailed.

[01:08:38] Speaker 01:
Petitioners made several challenges to that in the original Vecino's judgment.

[01:08:43] Speaker 01:
And so in terms of scoping, in terms of whether this should be a new alternative, we think that is barred.

[01:08:49] Speaker 01:
Petitioners also make the argument that you should consider this as a new mitigation measure.

[01:08:53] Speaker 01:
That was also discussed by FERC in the earlier decision.

[01:08:58] Speaker 01:
FERC concluded that it was not going to consider new mitigation for greenhouse gases, and that was in the initial 2020 reauthorization order.

[01:09:09] Speaker 01:
And so both of these issues were previously considered and we think we think are barred.

[01:09:14] Speaker 02:
At least some of that sounds like.

[01:09:16] Speaker 02:
is independent of the fact that it came up and was remanded.

[01:09:19] Speaker 02:
Because if it's based on scope, then even if you're still in the midst of the initial proceeding before it ever came up here, as I understand it, you're saying there's a scope phase that imposes a calendar line.

[01:09:35] Speaker 02:
And at the end of the scope phase, then you don't have to take into account the stuff that comes up afterwards, regardless of the fact that it came up and was remanded.

[01:09:42] Speaker 01:
I think that's right, Your Honor, in terms of alternatives.

[01:09:46] Speaker 01:
Now, obviously, residue to kind of gives way to supplementation, right?

[01:09:49] Speaker 01:
If I knew if there's serious new impacts, but that's not what we think is happening here in terms of connected action and scoping.

[01:09:55] Speaker 01:
I think that's all off the table that's been decided before.

[01:09:58] Speaker 01:
In terms of a supplemental new environmental harm or impact, we don't see that here either.

[01:10:04] Speaker 01:
I think it would be quite an extraordinary proposition to say that you could have an authorized project.

[01:10:08] Speaker 01:
It's under construction.

[01:10:10] Speaker 01:
The environmental impact statement hasn't been vacated, and you have years later new technology.

[01:10:15] Speaker 01:
The developers here actually obtain patents for proprietary aspects of the urban capture project.

[01:10:20] Speaker 01:
You can have new changes in technology, and that can somehow make you reopen the earlier project.

[01:10:25] Speaker 01:
I mean, that would, I think, completely run afoul of what the supplemental environmental impact statement test

[01:10:31] Speaker 01:
is for I think it is primarily a backwards looking inquiry right when the original decision makers were looking at the alternatives did they say that are they harboring under some kind of misunderstanding about what the impacts would be on those existing alternatives not whether or not some new technology would come down years later that would that would you know change change the alternatives otherwise there'd be no finality

[01:10:54] Speaker 03:
Just one factor that that telling might overlook is that the context here was there was a remand.

[01:11:01] Speaker 03:
And as I understand it, this proposal was explicitly advanced as a reason to secure speedy authorization of the project.

[01:11:10] Speaker 03:
In other words, it really seems like it was the client itself introducing this issue as

[01:11:19] Speaker 03:
part of a live ongoing process.

[01:11:21] Speaker 03:
And now it feels like a bit of an about face to say, well, actually, we got it approved without this expensive addition on top.

[01:11:32] Speaker 03:
And now we're going to take the position that it's time barred.

[01:11:36] Speaker 03:
Can you just help walk me through why that's not a reasonable view?

[01:11:39] Speaker 01:
Certainly, and we're not saying it's time barred that the CCS application will ever get considered.

[01:11:43] Speaker 01:
It is a live application with a FERC docket.

[01:11:46] Speaker 01:
Petitioners will be able to participate in that docket.

[01:11:49] Speaker 01:
And if they have concerns with the application or they want to argue about wetlands impacts, all those other things will occur.

[01:11:55] Speaker 01:
We are not saying that they shouldn't happen.

[01:11:57] Speaker 01:
Our position is that, you know, we introduced the application because that was the best business decision for the company.

[01:12:04] Speaker 01:
I very much wants to be a leader in green LNG is not simply to curtail the remand order.

[01:12:10] Speaker 01:
Otherwise, the project applicants could have pulled out the CCS application after they got a successful hearing order from FERC.

[01:12:17] Speaker 01:
That's not the intention.

[01:12:18] Speaker 01:
The developers very much want to go forward.

[01:12:21] Speaker 01:
The petitioner's point in their brief, they argue that, you know, we said in our application, well, this will minimize the impacts.

[01:12:30] Speaker 01:
That's true, but we didn't say you have to consider it.

[01:12:32] Speaker 01:
It's within FERC's discretion whether they want to consider it together or not.

[01:12:36] Speaker 01:
And FERC made the reasonable judgment not to consider them together because of the timing issues that you knew to Judge Garcia.

[01:12:44] Speaker 01:
You have the original decision that came down on

[01:12:47] Speaker 01:
So I think from a temporal standpoint and in terms of a functional independence standpoint, they still remain very different.

[01:13:05] Speaker 02:
Is, um.

[01:13:06] Speaker 02:
From your client's perspective, the application is still on the table, and it's something that is fully intended to be pursued.

[01:13:12] Speaker 02:
It's not being withdrawn.

[01:13:12] Speaker 01:
That's right.

[01:13:13] Speaker 01:
But we believe it's a voluntary application, and it could be withdrawn.

[01:13:16] Speaker 01:
But we intend to pursue it.

[01:13:18] Speaker 03:
As a practical matter, do you know the answer to whether if the CCS add-on is approved, does that require some change to the ongoing be approved project as it stands, or will it just be

[01:13:37] Speaker 01:
Yes, it is just a tie-in.

[01:13:40] Speaker 01:
Right, it is a tie-in.

[01:13:41] Speaker 01:
The only reason it is before FERC is because it is physically a tie-in onto the system, but it is not operationally connected.

[01:13:47] Speaker 01:
And we explain this in the application itself, JA 714 and 716, that it's functionally independent.

[01:13:54] Speaker 01:
The CCS carbon capture could be turned off while the LNG terminal continues to function and so forth.

[01:14:03] Speaker 01:
So it is simply a tie-on, and that's the reason why

[01:14:05] Speaker 01:
there's a FERC application.

[01:14:07] Speaker 01:
The rest of the carbon capture system would not be FERC jurisdictional.

[01:14:12] Speaker 01:
It would be a carbon dioxide pipeline offsite to an underground injection well.

[01:14:19] Speaker 02:
OK.

[01:14:19] Speaker 02:
Make sure my colleagues don't have additional questions.

[01:14:21] Speaker 02:
Thank you.

[01:14:21] Speaker 02:
Thank you.

[01:14:35] Speaker 08:
Mr. Pinkus.

[01:14:41] Speaker 04:
Good morning.

[01:14:42] Speaker 04:
May it please the court, Michael Pinkus, correspondent, intervener, Texas LNG Brownsville.

[01:14:47] Speaker 04:
Because there's a lot of discussion about the Rio Grande project and the CCS amendment, I just want to point out the Texas LNG project has not changed.

[01:14:55] Speaker 04:
The project and its impacts are no different than they were nearly nine years ago or over nine years ago when the commission started its review of the project.

[01:15:03] Speaker 04:
So the only difference in the commission's analysis

[01:15:05] Speaker 04:
that occurred on remand is that the commission that overlaid the project impacts on additional demographic data to better understand and explain the impacts of the project on environmental justice communities at the direction of this court.

[01:15:18] Speaker 04:
And as I understand, petitioners argued, although I did not hear from them this morning, is that the remand order itself would require a supplemental EIS.

[01:15:27] Speaker 04:
But that is not true.

[01:15:29] Speaker 04:
The petitioners point to no requirement or instruction from the court that required a supplemental EIS in the remand order

[01:15:35] Speaker 04:
And in fact, the court had said it was reasonably likely that FERC could redress the two discrete issues while reaching the same result on remand.

[01:15:47] Speaker 03:
I understand the underlying NACS determinations didn't change, but just in terms of how different this environmental justice analysis is, it seems like a fairly extreme case if you just look at how different the environmental justice analysis is.

[01:16:03] Speaker 03:
We went from, I think, four or five blocks to hundreds.

[01:16:07] Speaker 03:
It's two miles to 50 kilometers.

[01:16:10] Speaker 03:
And when the whole point

[01:16:12] Speaker 03:
is to inform these communities of the impacts a project is going to have on them, and thereby invite them to give public comment.

[01:16:23] Speaker 03:
It seems like the position you're all advancing would mean that a new EEJ analysis is just never going to require a new EIS unless there's new emissions data that would independently require

[01:16:39] Speaker 03:
I realize this is a long question, but I just, isn't there any information, the whole purpose of the EJ analysis is to invite comment from those communities, and there's significant new communities being described here.

[01:16:51] Speaker 04:
And I think the FERC solicitor pointed out, too, the commission's process from the very beginning was a robust process that included involvement from the community.

[01:17:01] Speaker 04:
The very first scoping meetings were held back in 2015, and those were widely publicized.

[01:17:06] Speaker 04:
And at that point, I think the impacts of the project

[01:17:09] Speaker 04:
were first scoped and were made known to the affected communities.

[01:17:14] Speaker 04:
And then even during the commission's process on remand, having conducted a series of in-depth data requests and asking for a lot of information,

[01:17:22] Speaker 04:
on the impacts of the project on these communities to the applicants, to the project proponents, and then having issued the notice and being able to take comment and then digesting those comments and having additional data requests that also included incorporation of those comments from the public, from the petitioners.

[01:17:42] Speaker 04:
That was a robust process that included these communities and the interests of people within these communities.

[01:17:52] Speaker 02:
you make sure my colleagues don't have additional questions for you.

[01:17:54] Speaker 04:
That just concludes the Texas LNG project has substantial commercial agreements and we believe that the project will be fully contracted in a matter of weeks and that we have all the permits necessary to start construction and we intend to by the end of the year.

[01:18:10] Speaker 04:
Thank you.

[01:18:10] Speaker 02:
Thank you, Council.

[01:18:14] Speaker 02:
Mr. Matthews, give you three minutes for rebuttal.

[01:18:24] Speaker 05:
Thank you, Your Honor.

[01:18:25] Speaker 05:
It's a lot to respond to.

[01:18:27] Speaker 05:
On the particulate matter, is LeBlanc a monitor issue?

[01:18:34] Speaker 05:
So much of the discussion about whether the data was valid is post-hoc.

[01:18:37] Speaker 05:
It's simply not in the record.

[01:18:40] Speaker 05:
FERC never said, we need EPA to validate this data in the record.

[01:18:44] Speaker 05:
It is true that validating it is not just a straight add up all the numbers and take a simple average.

[01:18:49] Speaker 05:
But FERC linked to the instructions on how to do it, and FERC never said, we can't do it ourselves, we need EPA to do it.

[01:18:56] Speaker 05:
There are times where maybe you do need EPA to do some expert judgment about severe weather events, but there's no indication that that was actually a factor here.

[01:19:04] Speaker 05:
On the choosing Brownsville instead of Isla Blanca, I think FERC is arguing that they're telling the citizens of

[01:19:11] Speaker 05:
The city of Fort Isabel, it doesn't matter whether you're gonna breathe on healthy air because these other people over here are gonna breathe healthy air, which is just not the way NEPA or recent decision making works.

[01:19:21] Speaker 05:
FERC needed to take a hard look at the impacts on the city of Fort Isabel, even if FERC concluded that there was not a problem anywhere else.

[01:19:29] Speaker 05:
And I'll just, you know, as to the timing of it, this court has held in County of Butte versus Hagen that if new information comes in, even after an agency has already started its environmental analysis, the agency needs to address that information.

[01:19:43] Speaker 05:
And it may mean just explaining why it doesn't change anything or something, but the agency does need to address it.

[01:19:47] Speaker 05:
And FERC didn't address the information, the Isla Blanca data that was available here.

[01:19:55] Speaker 05:
On supplementation, this court is repeatedly affirmed, including in disabled trail, that agency action violates NEPA if the EIS undergirds it is insufficient.

[01:20:06] Speaker 05:
So one way that an EIS can be insufficient is that even if the EIS was valid when issued, new information comes out and calls it into question.

[01:20:12] Speaker 05:
And that's the situation 1502.9 addresses.

[01:20:16] Speaker 05:
But that's not the only time in which supplementation can be required.

[01:20:19] Speaker 05:
Here FERC isn't relying on the old EIS.

[01:20:22] Speaker 05:
FERC felt that it had to collect new data, did a whole bunch of new analysis.

[01:20:26] Speaker 05:
FERC isn't saying we could have re-approved the project on the basis of the 2019 EIS.

[01:20:31] Speaker 05:
FERC has said, you know, it is

[01:20:36] Speaker 05:
We didn't need new information if FERC is fixing the problems with the information that was available the time before.

[01:20:41] Speaker 05:
And so we do have a 1502.9 argument about new information, including the new environmental justice conclusion.

[01:20:48] Speaker 05:
But the fact that FERC redid its entire analysis is a reason that its implementation was required that doesn't squarely fit within the contours of 1502.9.

[01:20:57] Speaker 05:
On social cost of carbon, nowhere in the record FERC argued that the agencies that have used social cost of carbon for project level review, that those projects were somehow different than the projects at issue here.

[01:21:08] Speaker 05:
And some of the evidence that FERC cites about dental concern about the tool is frankly dated.

[01:21:16] Speaker 05:
We included in the record the 2010

[01:21:19] Speaker 05:
The very first announcement of the solar custom carbon protocol.

[01:21:22] Speaker 05:
At that time, the interagency working group on it said that the question of discount rates is contentious.

[01:21:27] Speaker 05:
24 years later, there's a consensus among federal agencies that the way you resolve that is by presenting the range of interest rates.

[01:21:38] Speaker 05:
And we have CEQ, we have other agencies saying, go ahead and use social cost of carbon, even in project level review, even if you aren't monetizing other impacts.

[01:21:46] Speaker 03:
So I think part of their response though is that what's not generally accepted is using this to determine significance in a NEPA sense.

[01:21:56] Speaker 03:
Even if it's a generally accepted tool, maybe that means they were required to use it and disclose it to put the project in context, which is exactly what they did.

[01:22:05] Speaker 05:
It's not quite what they did because they disclosed it, but they didn't incorporate it into their own analysis.

[01:22:10] Speaker 05:
And I want to emphasize that FERC is a little different than other agencies here.

[01:22:15] Speaker 05:
The CEQ regulation at 1502.16 says that even after you've decided to do an EIS, in that EIS, you have to discuss the significance, like it's a scale of impacts.

[01:22:27] Speaker 05:
FERC says it couldn't do that here.

[01:22:29] Speaker 05:
But FERC, in its regulations and practice, has this extra requirement where it

[01:22:34] Speaker 05:
to us to do it up down is an impact significant, like a binary question.

[01:22:39] Speaker 05:
And that's in 18 CFR 380.7.

[01:22:42] Speaker 05:
But it's also just in FERC's practice.

[01:22:43] Speaker 05:
We're in a FERC EIS for every impact other than environmental justice, or sorry, every impact other than climate change.

[01:22:52] Speaker 05:
FERC says this impact is significant or it's insignificant.

[01:22:55] Speaker 05:
And then that carries over to FERC's Natural Gas Act analysis, where FERC will say all the significant impacts are something we don't need to worry about.

[01:23:01] Speaker 05:
in deciding whether the project is in the public interest or not, and only ones that are significant weigh in that analysis.

[01:23:08] Speaker 05:
And so it's true that there aren't other agencies that have achieved a consensus on where the line between significant and insignificant is, but that's partially because that's not a line other agencies draw.

[01:23:21] Speaker 05:
And it's true that our argument about drawing the line is not a 1502.21 argument.

[01:23:26] Speaker 05:
That's an argument about FERC has to consider social cost of carbon.

[01:23:29] Speaker 05:
FERC can't claim that it's not a reasonable reflection what the costs will be.

[01:23:34] Speaker 05:
But once FERC is considering it, then it's just a straight APA claim about FERC has the tools to decide whether something is significant or not.

[01:23:40] Speaker 05:
And FERC hasn't provided any explanations to why monetized climate change impacts are any different than visual impacts.

[01:23:49] Speaker 05:
I see that I'm out of time.

[01:23:50] Speaker 05:
At least one quick note to how narrow the CCS claim is here.

[01:23:55] Speaker 05:
We aren't arguing that if there was a valid authorization for the project that FERC was no longer considering because it was already out the door and then new information about CCS came out, that FERC would have had to reopen the authorization to consider CCS.

[01:24:10] Speaker 05:
The issue here is that while FERC still had the terminal authorization pending before it, non-final, and then this alternative came forward,

[01:24:19] Speaker 05:
explicitly proposed as something Perk would consider in reconsidering the terminal.

[01:24:23] Speaker 05:
That's why there was an alternative argument here, but I just want to make it clear that we're not saying if there was a final authorization, they would have needed to reopen it.

[01:24:31] Speaker 05:
If there are no further questions.

[01:24:33] Speaker 02:
Thank you, council.

[01:24:34] Speaker 02:
Thank you to all council will take this case under submission.