On August 29, 2025, the US secretary of energy proposed a significant regulatory shift regarding the certification process for new interstate natural gas facilities. In a letter submitted to FERC, the secretary recommended terminating the ongoing policy proceeding in Docket Nos. PL18-1-000 and PL18-1-001 and therefore rescind the 2022 draft Updated Certificate Policy Statement. Instead, the secretary advocates for continued reliance on the longstanding 1999 Certificate Policy Statement, which remains in effect.
Background of the Policy Statement
FERC issued the original 1999 Certificate Policy Statement to outline its approach for reviewing applications to construct new interstate natural gas transportation infrastructure. In 2018 and again in 2021, the Commission issued Notices of Inquiry to explore potential updates to this framework, ultimately resulting in the release of a draft Updated Certificate Policy Statement in 2022. However, this draft has yet to be finalized. The secretary’s recent proposal, if adopted, would effectively end the effort to modernize the certification framework.
2022 Draft Updated Certificate Policy Statement
The 2022 draft aimed to bring greater transparency and consistency to FERC’s evaluation of whether proposed projects serve the public interest. Key elements of the draft update include the following:
- Project Need: Emphasized consideration of a broader range of evidence to assess project necessity beyond reliance upon binding precedent agreements for project capacity.
- Public Interest Standard: Proposed a more comprehensive balancing of economic, environmental, and other public interest factors in determining whether a project meets the “public convenience and necessity” standard.
- Environmental Impacts: Inquired if the Commission’s environmental analysis should be clarified and broadened to include whether the Commission should calculate and consider potential greenhouse gas emissions from downstream consumption of natural and whether the Commission should use the Social Cost of Carbon tool to weigh costs versus benefit of a proposed project.
- Landowner Considerations: Expanded the analysis of impacts on landowners, including noneconomic factors.
- Holistic Evaluation: Reaffirmed that FERC must consider the entirety of a project and its impacts in reaching a public interest determination.
Potential Implications of Rescinding the Draft
Rescinding the 2022 draft would preserve the existing 1999 framework, which arguably is consistent with multiple executive orders issued by the US administration calling for a reduction in regulatory obstacles to permitting infrastructure to support increased production of oil and natural gas.
Maintaining the 1999 framework should provide a more predictable pipeline permitting process and timeline advocated for by project sponsors that currently are developing new pipeline projects to meet growing demand for electricity by large industrial consumers such as data centers.
Affected landowners and environmental advocacy groups may continue to argue that the 1999 framework is outdated given evolving environmental, economic, climate, and public interest concerns. Overall, applying the existing 1999 Certificate Policy Statement may signal the Commission’s support for a more traditional and potentially narrower interpretation of project need and public benefit.
Next Steps
FERC is accepting public comments on the DOE’s proposal to terminate the policy proceeding and rescind the draft Updated Certificate Policy Statement. Interested stakeholders must submit written comments by September 9, 2025 at 5:00 PM Eastern Time.