Making good on its promise in Executive Order 13868 to combat the abuse of section 401 of the Clean Water Act by states seeking to block fossil energy infrastructure projects, the Environmental Protection Agency today issued updated guidance for states on implementing this provision. Section 401 allows states to reject projects that it believes violate state water quality provisions, but has been misused in recent years by climate activist governors to block natural gas pipelines and coal export facilities primarily because of the product being transported. The abuse has taken two forms—states dragging out the approval process by repeatedly asking the project developer for more information, or rejecting the project for reasons unrelated to the direct water quality impacts.
Perhaps the two most egregious examples of states using section 401 to pursue a climate agenda are Washington state’s rejection of the Millennium Bulk Terminal export facility for western coal to Asian markets, and New York’s rejection of natural gas pipeline expansion projects that would bring badly needed supplies into the state.
The EPA guidance sets firm deadlines for states to act under section 401 by holding them, with limited exceptions, to the one-year maximum originally set out in the law. Perhaps more importantly, the guidance reaffirms what should have been clear all along from the Clean Water Act itself—that the state reviews should be “limited to an evaluation of potential water quality impacts” of the project itself and thus would exclude air quality and climate change issues associated with the upstream production or downstream combustion of the fossil fuels being transported.
Of course, the guidance will likely be sidestepped by those governors intent on doing so, but it will strengthen the odds that the proponents of these projects will prevail in any legal challenges.
Further details about the scope of section 401 reviews will be developed in a notice and comment rulemaking also promised in the executive order.