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S. HRG. 109–856

OVERSIGHT HEARING TO REVIEW THE

PERMITTING OF ENERGY PROJECTS

HEARING

BEFORE THE

COMMITTEE ON 

ENVIRONMENT AND PUBLIC WORKS 

UNITED STATES SENATE

ONE HUNDRED NINTH CONGRESS

FIRST SESSION

MAY 25, 2005

Printed for the use of the Committee on Environment and Public Works

(

Available via the World Wide Web: http://www.access.gpo.gov/congress.senate 
COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS

ONE HUNDRED NINTH CONGRESS 

FIRST SESSION

JAMES M. INHOFE, Oklahoma, Chairman 

JOHN W. WARNER, Virginia 

CHRISTOPHER S. BOND, Missouri 

GEORGE V. VOINOVICH, Ohio 

LINCOLN CHAFEE, Rhode Island 

LISA MURKOWSKI, Alaska 

JOHN THUNE, South Dakota 

JIM DEMINT, South Carolina 

JOHNNY ISAKSON, Georgia 

DAVID VITTER, Louisiana 

JAMES M. JEFFORDS, Vermont 

MAX BAUCUS, Montana 

JOSEPH I. LIEBERMAN, Connecticut 

BARBARA BOXER, California 

THOMAS R. CARPER, Delaware 

HILLARY RODHAM CLINTON, New York 

FRANK R. LAUTENBERG, New Jersey 

BARACK OBAMA, Illinois 

ANDREW WHEELER, Majority Staff Director 

KEN CONNOLLY, Minority Staff Director

(II) 
(III)

C O N T E N T S 

Page 

MAY 25, 2005

OPENING STATEMENTS 

Chafee, Hon. Lincoln, U.S. Senator from the State of Rhode Island, prepared 

statement .............................................................................................................. 17

Inhofe, Hon. James M., U.S. Senator from the State of Oklahoma .................... 3

Jeffords, Hon. James M., U.S. Senator from the State of Vermont, prepared 

statement .............................................................................................................. 26 

Obama, Hon. Barack, U.S. Senator from the State of Illinois, prepared 

statement ....................................................................................................... 33

Vitter, Hon. David, U.S. Senator from the State of Louisiana ............................ 1

Warner, Hon. John W., U.S. Senator from the Commonwealth of Virginia, 

prepared statement .............................................................................................. 15

WITNESSES 

Buccino, Sharon, senior attorney, Natural Resources, Defense Council ............. 17

Prepared statement .......................................................................................... 120 

Duffy, Dennis, vice president of Regulatory Affairs, Cape Wind Associates, 

LLC ........................................................................................................................ 9

Prepared statement .......................................................................................... 43 

Hogan, Ronald E., general manager, Questar Exploration and Production 

Company ............................................................................................................... 19

Prepared statement .......................................................................................... 125 

Robinson, J. Mark, Director of the Office of Energy Projects, Federal Energy 

Regulatory Commission ....................................................................................... 7

Prepared statement .......................................................................................... 34

ADDITIONAL MATERIAL 

Article from USA Today entitled, ‘‘Oil projects may get less scrutiny’’ .............. 124

Letters: 

Senator John Warner to Karen Adams, U.S. Corps of Engineers,

March 25, 2005 .............................................................................................. 85

Senator John Warner to Hon. John Rumsfeld, Secretary of Defense,

April 27, 2005 ................................................................................................ 88 

Report entitled, ‘‘The Effects of Wind Turbine Farms on Air Defence Radars’’ . 89 

Schematic site map of the Cape Wind project ....................................................... 46

Statements: 

Independent Petroleum Association of America ............................................ 128

Nickerson, Susan, director, Alliance To Protect Nantucket Sound .............. 130

Table entitled, ‘‘Federal, State, and Local Permits and Approvals Required 

for the Construction of an LNG terminal’’ ......................................................... 38

(1)

OVERSIGHT HEARING TO REVIEW THE 

PERMITTING OF ENERGY PROJECTS 

WEDNESDAY, MAY 25, 2005

U.S. SENATE, 

COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS, 

Washington, DC. 

The committee met, pursuant to notice, at 9:30 a.m. in room 406, 

Senate Dirksen Building, Hon. James Inhofe (chairman of the

committee) presiding. 

Present: Senators Inhofe, Warner, Chafee, Isakson, Vitter,

Jeffords, Carper, Clinton, and Obama. 

Senator INHOFE. The committee will come to order. 

Let me start by recognizing Senator Vitter. He has to preside in 

just a few minutes. So if you would like to do an opening statement, I will defer to you for that purpose. 

OPENING STATEMENT OF HON. DAVID VITTER, U.S. SENATOR 

FROM THE STATE OF LOUISIANA 

Senator VITTER. Thank you very much, Mr. Chairman, and 

thank you for holding the hearing today. I think this is very important. I also want to thank all of our witnesses for coming to testify 

today about this very important issue. 

As our economy continues to grow and create more opportunities 

for more Americans, clearly our energy consumption continues to 

grow, even as efficiency grows significantly. So improving our permitting process and making it more efficient is very important. It 

is important to develop new energy sources, and that is critical to 

fuel the growth of jobs and the economy. 

By refining the permitting process, our Nation could focus on 

producing more energy domestically and reducing our reliance on 

foreign energy sources. Unfortunately, the way it is structured 

now, the National Environmental Policy Act, NEPA, has created 

obstacles that are very costly and slow progressing and even block 

projects rather than assess their environmental impact and move 

them forward. 

Again, in saying this, I do not quarrel with the stated goals of 

NEPA; I quarrel with how it is achieved in practice, which is very 

cumbersome, very inefficient, very uncoordinated, and that tends to 

not achieve the stated goals of NEPA, but simply slow down all 

projects that must go through that process. So the permitting process needs to be realistic and achievable if we intend to reduce our 

Nation’s dependence on foreign energy sources and increase our domestic energy productivity. 
2

Cooperation among all involved Federal and State agencies could 

simplify the permitting process by focusing on common energy objectives that would eliminate conflicting agendas that hold up the 

approval and review process. Participating agencies working together can improve factors such as certainty and timeliness that 

impact that permitting process. 

However, a definite time line would provide greater certainty for 

the review process since it is frustrating when not all of the participating agencies respond in a timely manner when issuing permits. 

Without processing the permits in a timely manner, development 

of necessary energy infrastructure is delayed and even financially 

crippled in many cases. In Louisiana this has significant impact. 

We need to take advantage of advancements in technology to increase domestic production of our natural gas reserves, and that 

has a big impact in Louisiana. 

So once again, Mr. Chairman, I applaud you for bringing a lot 

of focus and resources to bear on this very important project. I 

think the bottom line is really this: it is fair and reasonable and 

necessary to set these environmental and other permitting processes, but once we establish those goals, it should be all of our goal 

to get that done in an efficient and coordinated manner. Once we 

establish the policy, folks should not then go and make the process 

as complicated and inefficient as possible, quite frankly, to frustrate that policy and to essentially reopen the policy debate. We 

should make the process efficient once we set the parameters and 

the policy. I think the White House’s efforts at streamlining the 

process and your efforts in terms of your leadership position as 

Chairman are moving us in that direction. I thank you. 

[The prepared statement of Senator Vitter follows:]

STATEMENT OF HON. DAVID VITTER, U.S. SENATOR FROM

THE STATE OF LOUISIANA

Chairman Inhofe, thank you for holding this hearing today. I also want to thank 

our witnesses for coming to testify about this very important issue on reviewing energy project permitting. 

As our economy continues to grow, so does our energy consumption. Improving the 

permitting process for developing energy sources is critical if we are going to meet 

our nation’s increasing energy demands. By refining the permitting process, our nation could focus on producing more energy domestically and reducing our reliance 

on foreign energy sources. 

Unfortunately, the National Environmental Policy Act (NEPA) process has created obstacles that are costly, slow progress and even block projects rather than assess their environmental impact and move forward. The permitting process needs 

to be realistic and achievable if we intend to reduce our nation’s dependence on foreign energy sources and increase our domestic energy productivity. 

Cooperation among Federal and state agencies could simplify the permitting process by focusing on common energy objectives that would eliminate conflicting agendas that hold up the approval and review process. Participating agencies working 

together could improve factors such as certainty and timeliness that impact the permitting process. However, a definite timeline would provide greater certainty for the 

review process since it is frustrating when not all of the participating agencies respond in a timely manner when issuing permits. Without processing the permits in 

a timely manner, development of necessary energy infrastructure could be delayed 

and even financially cripple the project. 

In Louisiana, we need to take advantage of advancements in technology to increase domestic production of our natural gas reserves. Increasing domestic production will reduce our dependence on foreign energy sources and create jobs for a 

stronger economy. 
3

I look forward to hearing from our witnesses about their experiences and suggestions for improving the permitting process. Once again, thank you, Mr. Chairman 

for your efforts to organize this hearing.

Senator INHOFE. Thank you, Senator Vitter, and thank you for 

your loyal attendance here. 

OPENING STATEMENT OF HON. JAMES M. INHOFE, 

U.S. SENATOR FROM THE STATE OF OKLAHOMA 

This is a very significant committee hearing. Before you leave, I 

will tell you one story. Back in real life I was a developer and I 

can remember building down in South Texas on the coast. At one 

time, I actually had to go to 26 governmental agencies to get a doc 

permit for a condo development. I got to thinking, in this information age, it is just not necessary, it should not be necessary. So I 

come, I am afraid to say, Ms. Buccino, with a little bit of a bias 

toward over-regulation as a general principle. 

I believe that this Nation really needs an energy policy. It is 

ironic that we are having this meeting right now when the Energy 

Committee is in the process of working on the energy bill in a different room. The lack of a comprehensive energy policy has detrimentally impacted the country in several ways, and ultimately 

slowed down economic recovery. 

I have long said and I maintain that having a strong energy policy is a national security issue. I can remember when many years 

ago, back during the Reagan administration, Don Hodell, who 

served as both Secretary of Interior and then also as Energy Secretary, he and I had a song and dance where we would go around 

and try to explain to consumption States that our dependence upon 

foreign countries for our ability to fight a war is not an energy 

issue, it is a national security issue. Nobody believed it at that 

time. I was alarmed because we were dependent upon foreign countries for 33 percent of our oil. Today, it is twice that. So we have 

been moving in the wrong direction. 

Environmental policies have had a significant and varying effect 

on many of the energy problems this country faces—the high natural gas prices, the lack of refining capacity, which we have dealt 

with here in this committee at several hearings over a number of 

years, and the insufficient energy infrastructure, just to name a 

few. 

With great foresight, President Bush recognized the need for a 

comprehensive national energy plan some 4 years ago this month, 

but implementation of many of his recommendations has been frustrated in Congress. Environmental concerns are among the principal reasons for Congress’ failure to address America’s energy 

needs. 

Even the Federal Reserve Board Chairman Alan Greenspan 

noted as much, stating, ‘‘We have been struggling to reach an 

agreeable tradeoff between environment and energy concerns for 

decades . . . it is essential that our policies be consistent.’’ Chairman Greenspan delivered this warning 2 years ago before another 

Senate committee. 

I would ask my friends to remember that the Senate has been 

trying unsuccessfully to move an energy bill since the 107th Con-
4

gress. I am hopeful that we will be able to develop the needed consistency and send an energy bill to the President this year. 

The purpose of today’s hearing is to review the permitting of energy projects, and to consider whether permitting has incorporated 

the consistent approach Chairman Greenspan referred to; that is, 

balancing the needs of the environment and the energy needs. As 

an Oklahoman and someone very familiar with the oil and gas industry, it might surprise my friends that this hearing is energy 

source neutral. We are not here to discuss the environmental merits of one type of energy over another. 

Rather than focusing on any one energy source, I am concerned 

about the entire process. I think that the following quote from an 

energy interest summarizes the issues permit, ‘‘Review needs to be 

completed in a timely manner’’ and ‘‘Slippage undermines the 

credibility of the process and drains the energy and resources of 

the members of the public; indefinite delay harms not only the 

project proponent and those who see the benefits flowing from the 

project, but also damages stakeholders.’’

The fact of the matter is that the country needs all forms of energy and requires a diverse fuel mix to maintain economic progress 

and ensure a clean environment. 

Regardless of the type of energy, producers cannot find, harness, 

extract, or transport energy unless they can secure the necessary 

environment-related permits. The collective energy industries consistently claim that the requisite Federal permits and legal challenges from special interest opposition groups have prevented them 

from producing energy or delivering it to consumers and businesses. 

President Bush recognized the complexities involved in the permitting process in issuing Executive Order 13212, which called for 

Federal agencies to expedite permitting and established a White 

House Task Force on Energy Project Streamlining. The Federal 

agencies have improved their permitting, but a lot more can be 

done. 

I am not a bird expert. I do not know how much bird research 

should be done before building electricity-generating wind turbines. 

Is 6 months of state-of-the-art radar research sufficient, or is 3 

years too much? I do not know. 

However, I am confident that the project’s proponents would like 

to know with certainty the proper reasonable approach at the beginning, not at the end of the Federal permitting process. A lot of 

you do not understand that it is predictability that is necessary. 

You cannot make the necessary investments and do the necessary 

things, very similar to our highway bill that we are doing right 

now, you cannot just operate on 6 months extensions, you have to 

have a 5- or 6-year bill where you can plan in advance what to do 

and you can venture your capital and sell your story. 

Environmental regulations have increased demand for natural 

gas. Several special interest environmental groups celebrated natural gas over other energy fuels. Indeed, nearly all new electricity 

generation is fueled by gas over coal. Yet today, some of these same 

groups have worked against building the necessary infrastructure 

to transport their clean-burning bridge fuel. 
5

For example, the California and Nevada chapters of the Sierra 

Club voted to oppose both on the offshore LNG facilities even 

though the club favors gas over coal and nuclear energy. Similarly, 

some of the States that have the greatest demand for gas have not 

increased the infrastructure to deliver it. California, for example, 

has opposed the permitting of Liquefied Natural Gas and pipeline 

infrastructure even though, according to California’s Energy Commission, local air quality regulations require natural gas generation. 

California certainly is not alone in contributing to or facing a 

regulatory paradox. According to a report from the New England 

ISO, the nonprofit operator of New England’s power grid, natural 

gas in the region was increased from 16 percent in 1999 to a projected 45 percent in 2005; however, the States lacked the needed 

infrastructure to transport and distribute the gas. The ISO Chairman Berry stated that, ‘‘The long and complicated Federal permitting process for building new interstate pipelines is a greater obstacle than the technical construction work.’’

Some special interest groups would like oil and gas companies to 

go above and beyond what is required by environmental regulations. They would also like for operators to monitor potential environmental impacts. Council on Environmental Quality Chairman 

Jim Connaughton has suggested incorporating adaptive management, which includes monitoring to a wide variety of projects. 

These are fine goals in concept, but how do current permitting requirements provide for and encourage such a flexible approach? 

Lastly, I would like to recall Chairman Greenspan’s warning. He 

framed the issue as a tradeoff between energy and the environment. It is unfortunate that anyone describes balancing these two 

critical interests in terms of a tradeoff, sometimes that is thought 

of in disparaging ways. 

So I look forward to hearing from both sides of those individuals 

who are here representing environmental concerns, as well as for 

those who are involved in the permitting process and those trying 

to get permits. 

[The prepared statement of Chairman Inhofe follows:]

STATEMENT OF HON. JAMES M. INHOFE, U.S. SENATOR FROM

THE STATE OF OKLAHOMA

The nation needs an energy policy today more than ever. The lack of a comprehensive energy policy has detrimentally impacted this country in several ways, 

and ultimately slowed economic recovery. I have long said and I maintain that having a strong energy policy is a national security issue. 

Environmental policies have had a significant and varying effect on many of the 

energy problems the country faces; unsustainably high natural gas prices, lack of 

refining capacity, and insufficient energy infrastructure to name just a few. 

With great foresight, President Bush recognized the need for a comprehensive national energy plan some 4 years ago this month but implementation of many of his 

recommendations have been frustrated in Congress. Environmental concerns are 

among the principal reasons for Congress’ failure to address America’s energy needs. 

Even Federal Reserve Board Chairman Alan Greenspan noted as much stating, 

‘‘[w]e have been struggling to reach an agreeable tradeoff between environmental 

and energy concerns for decades. . . it is essential that our policies be consistent.’’ 

Chairman Greenspan delivered his warning 2 years ago before another Senate Committee. I would ask my friends to remember that the Senate has been trying unsuccessfully to move an energy bill since the 107th Congress. I am hopeful that we will 

be able to develop the needed consistency and send an energy bill to the President 

this year. 
6

The purpose of today’s hearing is to review the permitting of energy projects, and 

to consider whether permitting has incorporated the consistent approach Chairman 

Greenspan referred to. As an Oklahoman and someone very familiar with the oil 

and gas industry, it might surprise my friends that this hearing is energy source 

neutral. We are not here to discuss the environmental merits of one type of energy 

over another. 

Rather than focusing on any one energy source, I am concerned about the entire 

process. I think that the following quote from an energy interest summarizes the 

issues permit: ‘‘review needs to be completed in a timely manner’’ and ‘‘slippage undermines the credibility of the process and drains the energy and resources of the 

members of the public; Indefinite delay harms not only the project proponent and 

those who see the benefits flowing from the project . . . but also damages stakeholders.’’

The fact of the matter is that the country needs all forms of energy and requires 

a diverse fuel mix to maintain economic progress and ensure a clean environment. 

Regardless of the type of energy, producers cannot find, harness, extract or transport energy unless they can secure the necessary environment-related permits. The 

collective energy industries consistently claim that the requisite Federal permits 

and legal challenges from special interest opposition groups have prevented them 

from producing energy or delivering it to consumers and businesses. 

President Bush recognized the complexities involved in the permitting process in 

issuing Executive Order 13212, which called for Federal agencies to expedite permitting and established a White House Task Force on Energy Project Streamlining. The 

Federal agencies have improved their permitting but more can be done. 

I am not a bird expert. I do not know how much bird research should be done 

before building electricity-generating wind turbines; is 6 months of state-of-the-art 

radar research sufficient or is 3 years too much? I don’t know. However, I am confident that the project’s proponent would like to know with certainty the proper reasonable approach at the beginning not the end of the Federal permitting process. 

Environmental regulations have increased demand for natural gas. Several special interest environmental groups celebrated natural gas over other energy fuels. 

Indeed nearly all new electricity generation is fueled by gas over coal. Yet, today, 

some of these same groups have worked against building the necessary infrastructure to transport their clean-burning bridge fuel. For example, the California and 

Nevada chapters of the Sierra Club voted to oppose both on and offshore LNG facilities even though the Club favors gas over coal and nuclear energy. 

Similarly, some of the states that have the greatest demand for gas have not increased the infrastructure to deliver it. California for example has opposed the permitting of Liquefied Natural Gas and pipeline infrastructure even though, according 

to California’s Energy Commission, local air quality regulations require natural-gas 

generation. 

California certainly is not alone in contributing to or facing a regulatory paradox. 

According to a report from the New England ISO, the nonprofit operator of New 

England’s power grid, natural gas in the region was increasing from 16 percent in 

1999 to a projected 45 percent in 2005, however the states lacked the needed infrastructure to transport and distribute the gas. 

The ISO Chairman Berry stated that ‘‘the long and complicated Federal permitting process for building new interstate pipelines is a greater obstacle than the technical construction work.’’

Some special interest groups would like oil and gas companies to go above and 

beyond what are required by environmental regulations. They would also like for 

operators to monitor potential environmental impacts. Council on Environmental 

Quality Chairman Jim Connaughton has suggested incorporating adaptive management, which includes monitoring, to a wide variety of projects. These are fine goals 

in concept, but how do current permitting requirements provide for and encourage 

such a flexible approach? 

Lastly, I would like to recall Chairman Greenspan’s warning—he framed the issue 

as a tradeoff between energy and the environment—it is unfortunate that anyone 

describes balancing these two critical interests in terms as a tradeoff. A tradeoff was 

not what the nation’s first environmental law considered; in fact one of the stated 

goals of the National Environmental Policy Act goal is ‘‘to create and maintain conditions under which man and nature can exist in productive harmony.’’ A tradeoff 

was never intended. 

I look forward to hearing from the witnesses about the permitting challenges I 

described and other issues.

Senator INHOFE. With that, let me just go over who we have 

here. Mark Robinson, a Federal non-partial witness, is the director 
7

of Office of Energy Projects, permitting pipelines and liquefied natural gas, the Federal Energy Regulatory Commission. Dennis Duffy 

is the vice president of Cape Wind. Mr. Duffy will discuss how the 

permitting process of the proposed wind farm off Cape Cod has 

been overly burdened and allowing opponents to use stall and delay 

tactics. Sharon Buccino—is that pronounced right—is the attorney 

for the NRDC, and she will testify that existing Federal permitting 

process is adequate, and we will be looking forward to her testimony. Then Ron Hogan is the general manager of Questar, another 

one who has been involved in the permitting process. 

Why not start, Mr. Robinson, with you. Let me tell you, even 

though we do not have many members now, members will be coming in and out, and all members are represented by staff. So there 

will be questions that will be submitted to you for the record. 

We will go ahead and start with you, Mr. Robinson. 

STATEMENT OF J. MARK ROBINSON, DIRECTOR OF THE

OFFICE OF ENERGY PROJECTS, FEDERAL ENERGY

REGULATORY COMMISSION 

Mr. ROBINSON. Mr. Chairman, thank you very much. My name 

is Mark Robinson and I am the director of the Office of Energy 

Projects at FERC. We are responsible in our office for 1,600 hydroelectric projects, their licensing, inspections, safety and security of 

those projects. We also are responsible for certificating about 500 

to 2,000 miles of interstate natural gas pipelines per year and storage facilities, and also the authorization, safety and security of 

LNG terminals. 

I would like to make sure that I identify my bias, I think we all 

have those. I have been involved with siting energy infrastructure 

for the Commission for 28 years now. Over those 28 years, I have 

watched this process become more byzantine with every passing 

year. My concern is that we may be getting to a point in the complexity of the permitting process where ultimately the first dollar 

of investment will not occur and those dollars will migrate elsewhere, including overseas. 

My testimony goes specifically to three issues that I think need 

to be addressed in enhancing the permitting process. One is the parochial interests that sometimes override regional needs; two is 

what I call agency creep, where different agencies use an aspect of 

the project and their authority concerning that aspect of the project 

to make the overall public interest determination; and three is 

what I term distributed decisionmaking. I would like to focus in 

these oral comments on distributed decisionmaking and how that 

affects permitting of energy infrastructure. 

By distributed decisionmaking, I mean that everybody has a bite 

of the apple at this point. If you look at my testimony and the 

charts that I have attached to it, you will see for LNG facilities, 

as an example, in some States you are looking at 30, 40, 50 permits 

that have to be acquired by the proponent of that project before 

they can go forward. That in itself is a problem. But when you look 

underneath just the chart to see how that works, you can see how 

there is sort of an insidious aspect of permitting that can stop 

projects. 
8

One is the aspect that one agency will wait for another. They will 

say we cannot do this until they do that. So you end up with a sequential aspect of the permitting process that seems to go on and 

on and on. Two, everybody seems to want to take their particular 

permit and make that the last action that occurs. They want to 

wait until everybody else sees what is going on and then they take 

action. Well, if you have several agencies that are trying to do that, 

it becomes almost a bidding contest to see who gets to be the last 

person to say yes or no. That can also affect the ability for a project 

to move forward. 

The effect of this distributed decisionmaking is that ultimately 

projects that are in the public interest are not constructed. They 

die a death of a thousand cuts, with everybody taking a little bit 

of the project away as they go through the permitting process until 

the project just dies and goes away. I have seen that over and over 

again and with increasing frequency. 

The cure for this, of course, is pretty plain—you vest all authority with one agency for all the laws that are affected and hold them 

responsible. That is never going to happen. The genie is way too 

far out of the bottle for us to ever go back to having an agency decide whether or not energy infrastructure should or should not be 

built, there are too many interests involved. But that does not 

mean you cannot discipline that distributed decisionmaking, and 

that is what I would call for today. 

If we lack that discipline, if we do not acquire it—and Memorandums of Understandings, and MOAs, and administrative actions all 

seek to do this, but they do not have the force of law, if we do not 

discipline that process—what we will end up with is no decisions 

at all as this becomes increasingly more complex. To discipline that 

process, we are calling for a three-pronged approach to rational 

siting. 

The first prong of that is identification of an agency having exclusive jurisdiction for the overall siting decision. That does not 

mean that anyone else loses their authority—the Clean Water Act 

would still apply, the Endangered Species Act would still apply—

but those projects and those agencies dealing with that would have 

to recognize that is an aspect of the project, not the overall public 

interest determination. 

The second prong is the development of one Federal record. This 

is just good Government. It is a matter of taking all those agencies 

that have a role in this, who play a role, forcing them through law 

to work together to develop one record and then everybody acts 

from that record in a timeframe set by the lead agency. If they fail 

to make that decision in that timeframe, their decision will be conclusively presumed. That is the discipline applied to them to take 

an action within a timeframe set by the lead agency. 

The third prong of that rational siting process is direct appeal to 

the court of appeals. It does not do any good to have all those agencies make their decisions and then all of the appeal processes run 

off into various different arenas to try to be resolved over years and 

years of process. We need immediate appeals, a one-stop to go to 

the court of appeals to review those actions by those permitting 

agencies. 
9

If we have rational siting that would affect any type of energy 

infrastructure, what we will gain from that is certainty of the decisionmaking process. With certainty, that first dollar that people 

want to invest to develop infrastructure will be invested; it will not 

migrate overseas, and we will get decisions on what is and what 

is not in the public interest to develop in this country. Thank you, 

sir. 

Senator INHOFE. Thank you, Mr. Robinson. What is good about 

your opening statement is you actually come out with a specific recommendation. We do not hear that very often. I appreciate that 

very much. 

Mr. ROBINSON. Well, I have been dealing with this a long time 

but I feel very strongly that is about the only thing we can do to 

try to bring some sanity to the process. 

Senator INHOFE. We will be interested to explore that. 

We have been joined by Senator Warner, who is the senior member on this committee; however, I chair it because he is the chairman of the Armed Services Committee. Senator Warner, do you 

have an opening statement? 

Senator WARNER. Thank you, no. I would like the opportunity 

when Mr. Duffy completes his opening comments, if I could just 

spend a few minutes with him. 

Senator INHOFE. In some questions, you mean? 

Senator WARNER. Yes. I will not take long, and I thank you for 

the courtesy, Mr. Chairman. 

Senator INHOFE. All right. We will go ahead and move on to Mr. 

Duffy. After that, I know Senator Warner cannot stay very long, we 

would recognize Senator Warner to pursue his request. 

Mr. Duffy. 

STATEMENT OF DENNIS DUFFY, VICE PRESIDENT OF 

REGULATORY AFFAIRS, CAPE WIND ASSOCIATES, LLC 

Mr. DUFFY. Thank you, Mr. Chairman. My name is Dennis J. 

Duffy. I am the vice president of regulatory affairs for Cape Wind 

Associates. 

For the past 5 years, Cape Wind has been developing the Nation’s first offshore wind generation project. The project would be 

located approximately 5 to 10 miles off the nearest point of land 

on the coast of Massachusetts. It would generate up to 468 

megawatts of clean and renewable energy, with no fuel requirements and no air emissions. This amount would represent approximately 75 percent of the annual electric needs of Cape Cod and the 

Islands of Martha’s Vineyard and Nantucket. 

The principals of our company have been in the energy business 

for more than 25 years. We have developed and operated some of 

the most efficient gas-fired plants now operating in the U.S. Now, 

in direct response to State mandates for renewable energies, the 

so-call ‘‘renewable portfolio standards,’’ we are focusing upon wind 

energy development. 

We are confident that wind technology has now advanced to the 

point where it is both proven and reliable and can play a much 

more meaningful role in our national energy supply. In order to realize the full potential of this source, however, we need to ensure 
10

that our national energy and environmental policies are implemented in a consistent manner. 

The Cape Wind project would consist of 130 wind turbines located in Federal waters connected to the land-based power grid via 

2 submerged cables. Although this is the first offshore wind energy 

farm proposed in the U.S., in Europe offshore projects of this type 

have been operated successfully for more than a decade. The Cape 

Wind project——

Senator WARNER. Excuse me. I missed what you said. What had 

happened not in a decade? 

Mr. DUFFY. The European projects have been operating for a decade or more now. The project would be located on a shoal out of 

shipping lanes and would impose no restrictions on current uses of 

the area. Cape Wind enjoys strong support from environmental, 

consumer advocacy, and labor groups, and a Cape-based grassroots 

support organization with now over 4,000 members. 

The Federal regulatory process under current law is both thorough and comprehensive, but, importantly, it lacks any requirement that would limit the duration of project review period, which 

in some cases can open the door for opponents to try to use delay 

as an end in itself. After extensive analysis of potential sites, we 

submitted our application to the Army Corps in November of 2001. 

The project has been undergoing regulatory and public scrutiny for 

more than 31⁄2 years, including the preparation of an Environmental Impact Statement under the NEPA. 

The Army Corps has acted as the lead Federal agency in a process that has included 17 Federal and State participating agencies 

and which has afforded exceptional opportunities for public involvement, including 9 public hearings. During this process, an exhaustive record has been put together under a public interest standard 

which has included a whole range of issues, from environmental 

impacts, project aesthetics, cost implications, and the need of the 

public. 

At the same time, there has been an extensive parallel proceeding. In 2002, we filed with the Massachusetts Energy Facilities 

Siting Board for authorization for the transmission facilities which 

would cross the waters of the Commonwealth. I am happy to report 

that after a 21⁄2-year review, with 20 days of expert testimony and 

over 50,000 pages in an evidentiary record, on May 10, the Massachusetts Energy Facilities Siting Board approved our petition based 

largely on a finding that our energy would be needed for 3 purposes: To meet the growing need for the region’s power; to lower 

the prices to electric ratepayers; and to offset air emissions from 

fossil generation. 

Notwithstanding the review we have gone through over the last 

31⁄2 years, however, we still face additional processes of uncertain 

duration. In particular, the Army Corps issued a draft EIS in November of 2004 and has received more than 5,000 comments on the 

draft. While most of those comments were positive, the comments 

also included continued demands from project opponents that multiple years of additional field studies now be completed. Some, for 

example, call for the Corps to now evaluate nuclear and fossil plant 

proposals on an equal footing, notwithstanding the fact that we 
11

proposed this project in specific response to mandates for renewable energy. 

In conclusion, Cape Wind and the other wind projects that will 

follow present great potential for meeting the multiple objectives of 

national energy and environmental policy, including decreased reliance on imported fuel, reducing and offsetting air emissions, and 

lowering the cost of electricity to the ratepaying public, all with 

minimal environmental impact. 

Based on our experience, we have two suggestions for improving 

the process. First, we believe that national policy objectives would 

be better served if environmental review of proposed energy facilities were conducted in a more timely manner, perhaps pursuant to 

statutory timeframes that would prevent delay tactics from crippling an otherwise worthy project. I point out in that case, for example, many of the New England States have adopted energy facilities siting acts which specifically limit the review period to a 12-

month process for major energy projects. 

Second, because the process involves so many agencies with often 

conflicting agendas, it is important that the process appropriately 

recognize the clearly stated Federal and State energy objectives, as 

well as the societal tradeoffs inherent to any major energy project. 

Thank you. 

Senator INHOFE. Thank you, Mr. Duffy. 

Senator Warner. 

Senator WARNER. Thank you, Mr. Chairman. I will not be too 

long. I will put a number of things with unanimous consent in today’s record. 

Let me make it clear, Mr. Duffy, you do not know me, I do not 

know you, and this by no means is any personal criticism to you. 

But I became involved in this issue, as you probably know, because 

of several concerns. 

First, I think I have to digress a moment to speak about a personal aspect of this. For many years I was married to a wonderful 

person who is still a very dear and valued friend, I guess it was 

about 25 years ago now, 26 years ago when we unfortunately parted ways, but she does have a home in the Cape and I was actually 

married there to that wonderful woman. Every time I try and get 

into this fray, they conjure up this woman, who is very private, and 

three children of mine who occasionally visit the house. 

I just think it is fine for anyone to heap criticism on me, but I 

really resent, and it is not a part of your organization, but the local 

press has seized on this as why I have questioned this thing. I have 

not been to the Cape personally for a number of years, although 

I plan to go this year to a wedding for 3 days. So when I make a 

sighting, I am sure they will conjure up some more stories. But let 

us put that to one side. 

Here is my concern with this, because it really grabbed my interest in several ways. One, yes I have seen the Cape for many years, 

and that part of America to me is one of the great treasures—the 

next witness, Ms. Buccino, if you could listen to this—one of the 

great natural treasures in America is that confluence of islands up 

there, Martha’s Vineyard and the Cape and so forth. 

It is a marvelous sanctuary for birds and wildlife. It is a sailor’s 

haven, a fisherman’s dream. I could go on and on about that part 
12

of America. In my years, I have been to every place in this country 

one way or another just about. 

I have been very disturbed about the environmental community 

not focusing on this. The environmental community has sort of 

taken the hear no evil, see no evil, speak no evil, put hands over 

their face and look the other way because they realize that possibly 

some modest measure of energy can be derived from wind power 

and, therefore, all the evils of the other sources of energy is where 

they direct their attention. 

But I have never quite understood why they did not step in to 

look at this magnificent piece of America and speak on it in a more 

objective and authoritative way. But put that aside. That is one 

concern that I have, that it is just a treasure of this country. 

Second, let us go back—and I am going to put in today’s record 

a letter I wrote, Mr. Chairman, to the Army Corps of Engineers. 

Senator INHOFE. Without objection. 

Senator WARNER. As a member of this committee, I have some 

say about the Corps, and as a member of the Armed Services Committee, we have some things to say about the Corps. We had before 

this committee, Mr. Chairman, the former Assistant Secretary of 

the Army, not the former, he is currently again acting, for Civil 

Works, Mr. Woodley, and I am going to put in today’s record the 

full testimony of the Assistant Secretary. 

Senator INHOFE. Without objection. 

Senator WARNER. Mr. Woodley stated that he did not believe the 

Corps has clear statutory authority to grant Federal permits for 

wind power projects in the Federal offshore shelf waters. This is 

what I wrote to the Corps of Engineers, they are having this open 

hearing on this:

‘‘The Corps is reviewing an application for a navigation permit under section 

10 of the Rivers and Harbors Act of 1899—1899. The only windmills or wind 

power that the Members of Congress had any knowledge about then maybe was 

Don Quixote, as you know, and a few local farmers’ windmills and something 

else. They never envisioned this. To think that you are moving forward on this 

project under that ancient statute, which in my judgment and the judgment of 

the Acting Assistant Secretary of the Army for Civil Works, just does not have 

the statutory framework to support this decision.

I go on:

‘‘The stated purpose of this statute is clearly to prevent obstructions to navigation in waters of the U.S. It does not provide authority to the Corps of Engineers to grant property interests in those CS lands, as would be the result 

should this permit application be granted. The legislative history of the 1899 

Rivers and Harbors Act shows that section 10 was originally enacted to remedy 

the inability of Federal common law to prevent obstruction to navigation. The 

law and implementing regulations have been broadened somewhat over the 

years and now includes a public interest test. But its essential purpose has not 

changed. 

‘‘The jurisdiction of the Corps of Engineers as provided in the 1899 Rivers and 

Harbors Act and implied authorities under the Outer Continental Shelf Lands 

Act are wholly inadequate to evaluate the construction proposed of 130 windmill 

towers in U.S. waters to properly protect our environment, to ensure that navigation on our seas is not impeded, to guarantee that public assets are not granted to private developers for free, to provide for appropriate compensation to the 

Federal taxpayer for the private use of public lands, and to ensure the careful 

management of other Federal interests. The 1899 statute simply cannot, and 

should not, be stretched 100 years later to embrace the unique concepts of the 

proposed project.’’
13

I am not against the concept of wind power. I simply say, if it 

is going to be done, do it right. The responsibility in large measure 

falls upon the Congress. When the energy bill, Mr. Chairman, is 

brought up, I intend to address this issue on the floor. I tried last 

year in the context of the Military Act, which the Chairman and 

I worked on, to ask for a 1-year moratorium to give Congress the 

opportunity to step in and establish a regulatory framework for 

these offshore lands, such that you could proceed under a current 

law of Congress specifically designed to take care of the wind 

power. 

Now these wind units are proposed off the shore of Virginia, and 

that is really the underlying reason why I am so involved in this. 

I do not understand how you can put this much private capital behind a project that really has no foundation in statutory law for the 

regulatory process. Yes, you have been at this for 3 years-plus. I 

guess I am slightly amused by that. I have been for 15 years trying 

to get a dam in Virginia with the Corps of Engineers. I have not 

given up by any measure, but these processes are somewhat slow. 

So I have stated my case, Mr. Chairman, and I would like to 

have our distinguished witness reply, to the extent that he wishes. 

To save time, you can have a chance to look over my letter, and 

I would ask that maybe you would like to expand your remarks 

and place them in today’s record after you have had an opportunity 

to reflect on this. 

Mr. DUFFY. Thank you, Senator, I would welcome that opportunity. Let me just say, I fully appreciate your concerns, but on the 

legal analysis I think we respectfully disagree on a couple of points, 

which I can explain somewhat. 

The way we have read section 10 of the Rivers and Harbors Act 

is that it was always intended to be a general delegation of authority to the Army Corps and not limited to any specific type of structure or for a specific purpose. 

For example, we looked back over a long history of courses of 

dealing where the Army Corps has used its section 10 authority for 

a whole host of different types of projects. Some have included 

things like rerouting rivers; others, highway construction projects, 

bridge construction projects; and others offshore have included 

things such as filling hundreds of acres of waterways of the Federal 

waters for things such as airport expansions. 

More specifically going offshore, the section 10 authority has 

been used for a whole range of authorities which have been recognized by court decisions which have included things such as offshore cable projects, weather towers, and radio stations. There is 

a whole range of things that the Corps has done historically with 

an established course of dealing which has been upheld in the 

courts. 

I would also point out that we, more than 21⁄2 years ago, got a 

preliminary permit to place an offshore weather station with a 200-

foot tower for taking wind data, which has been in service now for 

over 2 years. The opponents to our project appealed the grant of 

that permit under some of the very same reasons, arguing that the 

Army Corps’ offshore structure was intended to be very narrow and 

limited, and in fact limited only toward extractive operations. 
14

We have now gone through 2 years of Federal court litigation 

with two decisions at the district court in Massachusetts, and two 

decisions at the first circuit, which we think confirm our original 

reading that the congressional grant of authority to the Corps was 

not meant to be limited, but it was general in nature and extends 

beyond extractive structures. 

But I think probably more importantly to the policy question, we 

feel that under current law the structure is in place to give a full 

and fair regulatory review to the substantive issues. 

Senator WARNER. What structure is in place? 

Mr. DUFFY. Well, I would say the structures are the public interest review that the Army Corps applies under any section 10 review process, which includes the whole range of all likely detriments and benefits that might result from the project, which are 

going to include issues such as aesthetics, tourism, conservation, 

fish and wildlife impact, as well as current uses of the area. 

That is why the draft EIS which was released after the first 

phase of the project included over a 4,000-page analysis of all these 

issues. I would point out that, in addition to the process being driven by the broad public interest test of the Corps’ statute, it is also 

being done pursuant to the National Environmental Policy Act, 

where it is proceeding in line with the rules and procedures established for an environmental impact statement, which has involved 

19 participating agencies both from the Federal and the State level. 

So I recognize fully the type of issues that you raised in particular. I know the Cape very well. It is very special to me as well. 

But I feel that when you stop and look very closely at the process 

which has happened so far, including the Massachusetts review 

and approval which we just got a couple of weeks ago, as well as 

the Federal process, I think the analysis really shows a careful balancing which recognizes that there are going to be detriments to 

this project, like any energy project, but tends to view those in the 

overall scheme where they are at least weighed and measured 

against the potential benefits. 

We just think when people see the final environmental impact 

statement we really believe that the merits of the projects are 

going to be far in excess of the detriments. We do not dismiss the 

detriments, but we think on balance the project makes sense. 

Senator WARNER. I came within a millimeter of getting my statute of a year’s moratorium through. I will not tell you what happened in the wee hours of the morning, but one individual was able 

to stop it in the other body. That is the way we do business up 

here. I am not complaining. I have done it myself. 

But I came up through the legal profession and I just say to myself, if I were in your position, as an industry, not just your company, as an industry, you should have come to the Congress and 

said, ‘‘Look, we are first cousins to the oil and gas industry and 

there has been a framework of law and regulation covering their 

offshore drilling for years and it sets out clearly the criteria, the 

environmental concerns, a whole framework is there.’’

You should, in my judgment, be treated fairly under that type of 

framework of law, rather than fumbling around and trying to 

squeeze an 1899 statute to get under. Because some Federal court 

someday might just slam you down and say, ‘‘You know, those 
15

Members of Congress never were envisioning this type of energy, 

the source, as fitting into a navigation statute.’’

There you are, and all your shareholders and the rest of the 

world, and all the turbulence in the Cape, and everything else either comes to a standstill or collapses. Why has the industry never 

come to the Congress and said, ‘‘Come on Congress, this is a potential source of energy, we would like to do it in the proper way, give 

us a framework of laws?’’

Mr. DUFFY. I understand your concern there, Senator, and to 

some extent I do share it. But I think on one level we do feel sound 

in our legal position. 

But we, both our project as well as the industry generally, have 

been supportive of some of the legislative proposals which have 

been circulating for the last 2 years, including the Administration’s 

proposal which was introduced last session originally as the Cuban 

amendment, now included in the House version of the energy bill 

and I believe also in the version that is circulating in the Senate. 

Senator WARNER. Well, we will see what comes out of that. That 

has sort of made my point. But there is also the interest of the Federal taxpayer. I think you will grant me the common ground of 

agreeing that in the oil and gas situation that taxpayer is protected 

when U.S. property is used for purpose by the private sector to create a product, whether it is oil and gas or, in this instance, wind. 

But the taxpayer is not protected as you are proceeding. Am I not 

correct there? 

Mr. DUFFY. You are correct, Senator. Under current law, only extractive uses of the Outer Continental Shelf pay a royalty back to 

the Government, oil and gas extractions under a mineral lease. 

Non-extractive activities such as the Ocean Thermal Energy Act, 

cables, communications systems, are permitted, but they do not pay 

a royalty. We do not oppose that. The current provisions within the 

bill that would address offshore would provide for compensation to 

the Government, and we have no problem with that. 

Senator WARNER. I thank you for your indulgence and your courtesy. We will continue to work away. I thank the Chair. I will put 

some things into the record. I will provide you with a copy of my 

letter to the Corps of Engineers which sort of states the case, 

maybe you have it, I do not know, but I will give you a copy. Thank 

you very much. 

Mr. DUFFY. Thank you, Senator. 

[The prepared statement of Senator Warner follows:]

STATEMENT OF HON. JOHN W. WARNER, U.S. SENATOR FROM

THE COMMOMWEALTH OF VIRGINIA

Thank you, Mr. Chairman for calling this hearing today. We are here to discuss 

and examine the permitting process for energy projects. Our witnesses will share 

their first hand knowledge and experience with what is a broken process. The 

growth in demand for energy is outpacing our growth in supply and increased global 

consumption is driving prices even higher. As the demand for energy rises in the 

U.S. our goal as public servants should be to help provide a legal and regulatory 

framework that helps deliver basic resources to the citizens in the most cost-efficient 

and environmentally friendly manner possible. The President has called for efficient 

permitting and numerous energy bills have been proposed with hopes of improving 

this review process. 

Ironically, the permitting process isn’t just inadequate for energy projects but also 

other public works. I have been working for the better part of two decades to get 
16

a reservoir approved for an area of my state in desperate need for more drinking 

water. It simply should not take this long to obtain a permit for a water reservoir. 

Today we will hear testimony from entities in oil and gas exploration and wind 

energy development tell their stories of how difficult it is to obtain the necessary 

permits to move ahead on any energy producing work. They will share very different 

stories; one of frustration with bureaucratic red tape and the other as a pioneer attempting to break new ground. 

Over the past several years I have taken a particular interest in the growing wind 

energy industry in the U.S. The Department of Energy says that this industry is 

growing at a 24 percent rate each year. Technological advancement (mainly as a result of growing the size of the actual wind turbines) and a healthy Federal tax credit 

have combined to enable wind energy companies to produce electricity at a consistently cheaper rate over the past twenty years. However, the cost to the American 

consumer is not accurately reflected in this model as it fails to take into account 

the overall cost to the Treasury of the tax credits. The Department of Interior has 

a strong and clear process in place for the permitting of these resources on public 

lands and also for the competitive bidding and leasing of OCS lands for oil and gas 

development. Unfortunately this framework is not currently clarified for the permitting of offshore wind production. As a result, we could have a form of electricity production subsidized by the American taxpayer in the form of free land and cash back 

just to make the cost to the consumer about the same as other forms of electricity. 

I look forward to hearing from our witnesses today and having the opportunity 

to shed some light on the potential problems on the horizon if we do not establish 

a comprehensive process for the permitting of off shore wind production. According 

to the U.S. Commission on Ocean Policy ‘‘there is no comprehensive and coordinated 

Federal regime in place to regulate offshore wind energy development or to convey 

property rights to use the public space of the OCS for this purpose.’’ The Commission has clearly called for the establishment of such a process in its Final Report 

saying that Congress should enact legislation to streamline the licensing process 

with adequate review from local, state, and Federal entities, with a fair return to 

the U.S. Treasury for the use of the public resource. 

The U.S Army Corps of Engineers has claimed Federal authority over the granting of permits through the Rivers and Harbors Act of 1899. However, the legislative 

history of that law shows it was originally enacted to prevent obstructions to the 

navigable waters of the U.S. It is not only my view, but one shared by many others, 

that this law is clearly inadequate to fully evaluate the construction of thousands 

of windmills in the waters of the United Sates. In fact, the EPA, USGS, and U.S. 

Fish and Wildlife have all gone on the record about the current application. When 

asked directly about the Corps’ authority under the 1899 statute, the Assistant Secretary of the Army for Civil Works said ‘‘It is not well adapted to the purpose I do 

not believe that the Corps of Engineers is the appropriate resident for that except 

to the extent that we should be consulted with respect to the navigation channels.’’

It is our responsibility to make certain that any permit granted is done so in a 

manner that uses more than just a superficial review under the Rivers and Harbors 

Act of 1899 so that we are ultimately able to properly protect the environment, to 

ensure that navigation on our seas is not adversely affected, to guarantee that public assets are not granted for free to private developers, to provide for appropriate 

compensation to the taxpayers for the use of public lands, and to provide for and 

ensure the careful management of other national interests such as aviation and the 

national defense. 

It is my hope that we are able to continue to shed light on this issue so that the 

Nation will be able to move ahead in the expansion of our energy and electricity 

production. As we know all too well, the growing population and economy will continue to grow its need for these resources. The communities affected, companies 

working hard to develop innovative solutions, and the American public all deserve 

a process that is sufficient and efficient in providing the proper review to achieve 

our ultimate goal.

Senator INHOFE. Thank you, Senator Warner. 

So the other members who have arrived will know where we are, 

we have completed opening statements, and we have heard the 

opening statements of Mr. Robinson and Mr. Duffy, but not from 

the other two witnesses yet. 

At this point, if any, or all of you, want to make an opening 

statement, I only ask that you try to confine it to 4 or 5 minutes. 

In order they came in, I believe Senator Chafee is first. 
17

Senator CHAFEE. I will submit mine for the record, Mr. Chairman, so we can continue with the hearing. 

[The prepared statement of Senator Chafee follows:]

STATEMENT OF HON. LINCOLN CHAFEE, U.S. SENATOR FROM

THE STATE OF RHODE ISLAND

Thank you, Mr. Chairman. 

Thank you for calling this hearing on the permitting of energy projects. 

Energy is the lifeblood of our economy. Everyone depends upon access to affordable, reliable energy to conduct the activities of their lives. 

As our nation’s demand for affordable, reliable energy increases, our current capacities continue to be strained. My hope is that we can continue to work at alleviating the supply shortage by promoting energy efficiency and energy conservation 

programs to cut down on demand. However, these measures alone will not be 

enough. To sustain a growing, robust economy, new energy projects will have to be 

sited. It is my hope that the siting of new projects will be carefully scrutinized, and 

that public safety and environmental concerns remain our nation’s priorities. 

It is my firm belief that Americans deserve an affordable, reliable energy supply 

and a clean environment. Both are achievable. Today’s hearing is important so that 

we can benefit from the experiences of existing energy projects; learn from the past; 

and build upon the successes that we have already enjoyed. By doing so, we have 

the opportunity to make significant improvements in our quality of life. I look forward to hearing the testimony of today’s witnesses so we can benefit from their 

work. Thank you.

Senator INHOFE. Thank you, Senator Chafee. 

Ms. Buccino, we are finally around to you. You are recognized. 

Please try to confine your statement to 5 minutes if you could. 

STATEMENT OF SHARON BUCCINO, SENIOR ATTORNEY, 

NATURAL RESOURCES DEFENSE COUNCIL 

Ms. BUCCINO. Good morning. My name is Sharon Buccino. I am 

an attorney with the Natural Resources Defense Council. NRDC is 

a nonprofit organization. We have over half a million activists and 

members across the country. We work to protect the environment, 

but for the humans living in it. 

I, like you, want to make energy permitting work better. I have 

had the privilege to work with ranchers, farmers, homeowners 

across the West as energy development has come to their communities. Domestic energy production, the work of companies like 

Questar, is important. The permitting process is what allows this 

development to go forward in a way that identifies community concerns and addresses them. The permitting process is what gives 

citizens a voice in the Government decisions that affect their lives. 

I would like to spend the few minutes I have here to address the 

National Environmental Policy Act, known as NEPA. NEPA was 

signed into law in 1970 by President Nixon. Since then it has 

served as a valuable tool to produce both informed and accepted 

Government decisions. It has helped citizens protect their communities and enhance the quality of their lives. NEPA has also helped 

Federal officials better meet the needs and interests of the public 

they serve. 

NEPA improves projects. I was involved in a seismic exploration 

project in the Nine Mile Canyon region of Utah. This is an area 

that the State of Utah has described as ‘‘an outdoor museum.’’ The 

Bureau of Land Management describes the area as ‘‘the greatest 

concentration of rock art sites in the U.S.’’ This project involved 

60,000 pound trucks and they used explosives to collect data about 
18

oil and gas resources. It was in a very sensitive, arid area in Utah’s 

canyon lands. 

As a result of the review process under NEPA and also under the 

National Historic Preservation Act, the company conducting this 

exploration took additional steps to protect those natural and cultural resources that were in the area. The company agreed to additional monitoring and mitigation. In fact, just recently in a USA 

Today article, the BLM manager for that project said, ‘‘I can’t 

imagine this project without a process like (this).’’

NEPA gives people a voice. You will find that many of your constituents, from city council members to homeowners, care deeply 

about NEPA. They care about having a say when the LNG facility 

may be coming into their area, when a gas company wants to put 

a coal-bed methane well in their backyard, when a highway is proposed through their neighborhood. I urge this committee and Congress to work to enhance the public’s voice and not silence it. 

There are several provisions that have actually been introduced 

and passed on the House side in the energy bill, H.R. 6, that take 

us in the wrong direction. I will just highlight one, which is section 

2055. It removes completely from the NEPA process numerous oil 

and gas activities, including the seismic exploration that I just described. It provides that those activities shall not be subject to review under NEPA. Rather than working to improve the review 

process, this provision simply eliminates it. Instead of using the 

NEPA process to identify and address concerns and potential adverse impacts on the public’s health, livelihood, and communities, 

this provision excuses the Government and industry from listening. 

I urge you to fight to keep energy legislation clean of provisions 

that compromise environmental protections and public participation. In the past, this committee has stood strong in defense of 

NEPA, the Clean Water Act, the Clean Air Act, the Safe Drinking 

Water Act, and I urge you to stand strong now. 

Finally, one last point I would like to make is that we can increase domestic energy production without weakening environmental protections. Getting permits is not preventing oil and gas 

companies from drilling. In fact, the Bureau of Land Management 

is issuing record numbers of permits. In the last fiscal year, they 

issued over 6,000 permits, which was up from about 3,800 the previous fiscal year. Many of these permits are actually going unused 

right now. 

So in conclusion, because of the increasing demands being made 

on our public lands and our shrinking open space, NEPA is needed 

now more than ever. I remain inspired by that vision that was in 

NEPA—it is a future where man and nature can exist in productive harmony. It is a future where our valuable public lands serve 

diverse interests. I hope that this is a vision that you all share and 

will fight for as well. Thank you. 

Senator INHOFE. Thank you, Ms. Buccino. 

We have been joined by some other members. They have agreed 

not to have opening statements. So we will move right along. 

Mr. Hogan. 
19

STATEMENT OF RONALD E. HOGAN, GENERAL MANAGER, 

QUESTAR EXPLORATION AND PRODUCTION COMPANY 

Mr. HOGAN. Good morning, Chairman, and members of the committee. My name is Ron Hogan, general manager for the Pinedale, 

WY Division of Questar Market Resources. 

I would like to describe our efforts to obtain permission to reduce 

our environmental impact to levels substantially below existing 

regulations, while increasing worker safety and stabilizing our contribution to the local community. Some of the special technology 

and innovative solutions I will describe shortly may or may not be 

applicable to other oil and gas development projects, but perhaps 

our experience can help this committee understand the challenges 

we face in today’s complex regulatory environment. 

Pinedale is a small community in Sublette County, WY. According to the current estimates, there are over 20 trillion cubic feet 

of recoverable natural gas in the Pinedale anticline, which is about 

1 year’s supply of natural gas for the entire country. In July 2000, 

the Pinedale field office of the Bureau of Land Management published a record of decision that outlined the guidelines and restrictions for oil and gas exploration and development on the Pinedale 

anticline. This decision was the result of a comprehensive NEPA 

process that included significant public involvement. 

Among the many guidelines imposed by the record of decision 

was a restriction prohibiting drilling operations during the winter 

to minimize possible disruption to deer herds, other wildlife, and 

their habitat. To meet these restrictions, Questar was forced into 

a condensed, summer-only drilling schedule. Under these restrictions, we projected it would take nearly two decades just to fully 

develop the gas reserves available on our acreage, thereby delaying 

the delivery of much needed gas. 

While operating within these restrictions, we witnessed some of 

the unintended consequences of the summer-only schedule. For instance, the shortened season made it unfeasible and cost-prohibitive to apply available disturbance-limiting technologies like drilling directionally multiple wells from a single well pad. 

Also, it was difficult for us and our contractors to hire, train, and 

retain quality employees due to the seasonal part-time nature of 

the work. This, in turn, created an annual boom-and-bust economic 

impact on the local community. Perhaps most importantly, winter 

restrictions made better environmental mitigation measures economically unattractive or, in many case, physically unattainable. 

We did not feel these unintended consequences were the goal of 

the BLM’s record of decision. Therefore, Questar voluntarily offered 

to engage in a multi-year, multi-million effort to explore ways that 

we could leverage the benefits of new technology, minimize environmental impacts, enhance the safety of operations, stabilize the 

impact on the local economy, and meet or exceed the established 

goals for the protection of local wildlife and habitat. 

The first step in our effort was to submit a request to the BLM 

for a permit to operate one drilling rig during the winter of 2002–

2003. This would allow us to gain valuable scientific data and technical insight into whether a year-round development project could 

help avoid the unintended consequences of summer-only restrictions. In addition, we also voluntarily agreed to fund a University 
20

of Wyoming and Wyoming Game and Fish study that would help 

determine the real impact, if any, of natural gas development on 

wintering deer populations. 

Our request for an exception to the winter drilling restriction 

was approved by the BLM for the winter of 2002–2003, as was a 

similar request for a one rig, one winter exception for 2003–2004. 

On April 15, 2004, we formally submitted a comprehensive proposal for long-term year-round operations, with certain restrictions, 

on Questar’s acreage. I want to provide some quick highlights of 

our proposal so you can get an idea of the scope of our request. First, we proposed investing more than $200 million in directional drilling, thereby greatly minimizing surface disturbances 

and associated environmental impact. 

Second, we proposed expanding both the scope and the duration 

of the ongoing deer study to help design energy development 

projects that minimize disruption to wildlife and habitat. Third, we proposed building a $25 million water and liquid condensate pipeline system. This pipeline system eliminates the need 

for truck transport of produced water and condensate off the winter 

habitat area. At peak production from just our acreage, this system 

will eliminate more than 25,000 tanker truck visits in a single 

year. The result will be a significant reduction in traffic and air 

emissions from levels originally anticipated by the BLM. 

Fourth, we eliminated the need for flaring, which is used to clean 

up the production stream from new wells to remove the water and 

sand we use during the completion process. 

Last, we invested in busing our contractor’s employees during 

the winter months and trucking necessary materials in bulk to the 

rigs in the fall to decrease traffic in the wintering wildlife areas. 

In summary, our proposal included investments of more than $200 million in onsite mitigation and outlined an approach that 

was scientifically based, field tested, and offered substantial benefits over the restrictions imposed by the 2000 Pinedale record of decision. 

To facilitate a thorough review and analysis of our proposal, we 

worked closely with local BLM officials, biologists, and experts from 

Wyoming Game and Fish, and elected officials. We received formal 

support of our proposal from Wyoming’s Governor Dave 

Freudenthal, the Wyoming Game and Fish Department, U.S. Senator Craig Thomas, Wyoming State Representatives Monte Olsen 

and Stan Cooper, Pinedale Mayor Rose Skinner, as well as the 

Sublette County commissioners, the North American Grouse Partnership, and Trout Unlimited. 

We also recognized that the Pinedale community needed to be involved in the decisionmaking——

Senator INHOFE. Try to wrap up, Mr. Hogan, if you would. 

Mr. HOGAN. Yes, sir. In November 2004, the Bureau of Land 

Management officially approved our request for the site-specific 

limited year-round operations. I am proud of Questar’s Pinedale 

project. Our company is committed to invest over $200 million to 

achieve the benefits significantly above and beyond those required 

by existing regulations. 

But even with this commitment, our proposal is constantly at 

risk. We continue to get bogged down in a complex web of overlap-
21

ping jurisdictions and a maze of regulatory requirements that 

many times simply defy logic. When you add to the equation those 

that take advantage of regulatory complexity to delay, litigate, and 

obstruct any energy project——

Senator INHOFE. Mr. Hogan, I am going to have to interrupt you. 

You are almost 2 minutes over. We have to keep some time discipline here. 

Mr. HOGAN. Thank you. 

Senator INHOFE. Let me share with my panel members up here 

that the order of early bird and, going back and forth, will be myself, then Senators Carper, Chafee, Jeffords, Isakson, and Clinton. 

I will go ahead and start off. In my opening statement I made 

a statement that I will read again. I am going to ask each one of 

you whether you agree or disagree with this statement. So listen 

very carefully. What I said in my opening statement is, ‘‘Environmental review needs to be completed in a timely manner and slippage undermines the credibility of the process and drains the energy and resources of the members of the public. Indefinite delay 

harms not only the project proponent and those who see the benefits flowing from the project, but also damages stakeholders.’’

I will start with you, Mr. Robinson. Do you agree with that? 

Mr. ROBINSON. Agree wholeheartedly. 

Senator INHOFE. Mr. Duffy. 

Mr. DUFFY. Absolutely. 

Senator INHOFE. Ms. Buccino. 

Ms. BUCCINO. I agree with that statement. 

Senator INHOFE. Mr. Hogan. 

Mr. HOGAN. I agree, Chairman. 

Senator INHOFE. Thank you very much. I thought that would be 

the case. This actually was a quote from a letter that came from 

13 environmental groups, advocacy groups. So it seems that we do 

all agree, we have one area where we agree. 

Mr. Robinson, after your opening statement, I complimented you 

because you came out with something that was very specific. If you 

could abbreviate that for the members who were not here at the 

time, and then I am going to ask the other three if they agree with 

your comments on what I consider to be a reasonable solution. 

Mr. ROBINSON. First, I would like to make it clear that this proposal for a rational process for siting energy infrastructure does not 

in any way reduce the authorities of any other agency. What it 

does is to try to provide discipline to that process, something that 

we all work on and have worked on for years through administrative procedures, MOAs, and things of that sort. 

The first leg of that rational siting process is exclusive jurisdiction designated to a lead agency. What this would do would make 

it clear to all agencies that one agency is responsible for the overall 

public interest determination. Everyone else should focus on their 

aspect of the project, be it dredging for the Corps of Engineers, or 

water quality for the States. 

The second leg of the rational siting process is one Federal record 

development. All agencies involved in the decisional process should 

work together to create one record. That record would be used for 

all decisions at a single point in time under a schedule set by the 

lead agency. Should an agency fail to exercise their authority with-
22

in that schedule—keeping in mind that the lead agency has to look 

at all aspects of the project, so any schedule that would satisfy 

them should satisfy an agency that only has one aspect of the 

project—they would lose that authority. Their authority would be 

conclusively presumed. 

The third leg of that rational siting process is direct appeal of all 

of those decisions to the U.S. Court of Appeals. Instead of going off 

to the State administrative agency, then the State’s courts, or to 

another Federal agency, and then the Federal courts, everybody 

would go at one time. It would shorten the timeframe and give a 

certainty to the decisionmaking process. 

Senator INHOFE. OK. Mr. Duffy, what do you think of that? 

Mr. DUFFY. I had not thought of it before today, but I like that 

approach very much, and let me just tell you why. It sounds to me 

very similar to the approach on energy projects that most of the 

New England States have taken for their State environmental review of energy projects. By adopting energy facility siting acts 

which delegate to a specific board the primary, the ultimate authority for the decisions for energy projects, all the other entities 

that would otherwise have jurisdictional roles are still involved in 

the process but when they review the project, rather than each 

issuing their own opinion or their own decision, they issue an advisory decision to the State siting board which then makes a decision 

based upon all the relevant factors. 

I think the important thing to keep in mind is that when it operates in that way, the substantive standard should not have 

changed, the degree of examination and review should not have 

changed. But what you get is a single decisionmaker who is in a 

position to make a public interest determination after considering 

all of the other authorities which otherwise could give you conflicting results. 

Senator INHOFE. Thank you. 

Ms. Buccino. 

Ms. BUCCINO. I guess the way I react to that is, first, I would 

like to emphasize that I am for spending more money on protection 

rather than paper. As I said, I am for making the system, the process work better. I think maybe this takes us in the right direction. 

I would just like to flag a couple concerns that I think need to be 

looked at carefully if you consider moving in this direction. 

One is, I think that while the statement has been made, you are 

not taking authority away from existing State or local governments, there is very real concern that is the result. At least in the 

version that I have seen, I think it is in H.R. 6, at least it has been 

articulated there, you are making a clear change. You are concentrating authority in FERC. 

So my approach would be to give the resources that are needed 

to the agencies to provide their input in a timely manner rather 

than create a system that may put them at a disadvantage. You 

can look to the transportation act ISTEA where it was first used, 

where you have transportation funds going to resource agencies, 

wildlife agencies to help them get their job done. So my approach 

is help the agencies provide their input in a timely manner rather 

than silencing those voices. 
23

Senator INHOFE. All right. Mr. Hogan, I am going to let you answer for the record because we are running short of time here and 

I had one more question I wanted to ask in my turn here. 

Mr. Duffy, I found it to be interesting after Senator Warner 

asked you some questions, in your opening statement, do I understand that 75 percent of the electricity in Cape Cod, Martha’s Vineyard, and Nantucket is wind? 

Mr. DUFFY. No. If our project were to come online. 

Senator INHOFE. If it were to come online. How long would that 

take? 

Mr. DUFFY. Oh, probably 2 years from the time of a favorable decision. We have to work around winter construction seasons, but 

basically 2 years. 

Senator INHOFE. You always hear that the technology is not 

there, it is not going to work, and I have heard a lot of gloom and 

doom about wind energy. I would like to see it work. Where do you 

think we are in technology? 

Mr. DUFFY. Obviously, we have been in the energy development 

business for 25 years and we are putting our private capital at 

stake in this project. We have invested very heavily in this and, 

prior to doing that, we had to come to the conclusion that it was 

both technically viable and economically viable. I think in particular looking at the offshore projects, it is a proven technology, 

it has been commercially successful in operation in the European 

market for more than a decade. There are numerous projects under 

development in the European markets today. Off the coast of New 

York, the Long Island Power Authority is proposing a project very 

similar to ours. We are just absolutely convinced that the technology is proven. 

Senator INHOFE. Thank you, Mr. Duffy. 

Senator Carper is not here. Let us just go ahead and come back 

to him. 

Senator Chafee. 

Senator CHAFEE. Thank you, Mr. Chairman. It is a pleasure to 

join you here at this hearing on an important issue of the siting 

of energy facilities. Certainly, New England has been mentioned 

not only with Cape Wind, but LNG being very important to us also. 

We all know the abundance of natural gas in the world. The problem is getting it to market. It certainly burns cleaner than coal and 

oil, so it is advantageous to try and get it to market. Thus the dilemma. We have several fairly controversial proposals in Narragansett Bay; one on the Massachusetts side, one on the Providence 

side. 

But my question is to Mr. Robinson. In response to Ms. Buccino’s 

assertion that under H.R. 6, numerous gas and oil activities on 

public lands shall not be subject to review under NEPA, has FERC 

taken a position on that? 

Mr. ROBINSON. It is amazing how this proposal has generated 

criticism that has no application to the proposal. No one is calling 

for any changes to the NEPA process. The only thing that we are 

asking for is to discipline the process by allowing an agency, be it 

FERC or any other agency, who is designated as that lead, to set 

a schedule and have all other agencies act under their authorities 

whatever actions they want to take to grant or deny within that 
24

schedule. So there is no diminution of authority in any other agency whatsoever. 

As far as resources go, I think that was one of the other criticisms that we heard, that we should just apply more resources. I 

will guarantee you, as a regulator of 28 years, working with every 

agency that you can think of, State, local, or Federal, that we will 

consume those resources and we will design even more complicated 

processes administratively to try to do what we should do. It is not 

a matter of resources. It is a matter of discipline. I think that is 

what we are calling for in our proposal. 

Senator CHAFEE. Thank you. Mr. Hogan, I know you had interesting testimony of what is happening in Pinedale, but because of 

time constraints could not get through it. I think there is a ranch 

there, the Box R. 

Mr. HOGAN. I have heard of it, yes. 

Senator CHAFEE. The Logier family—I think Mrs. Logier came 

from Rhode Island from years back. So I am familiar with 

Pinedale. A beautiful area of the world. 

But you were going to say that you were trying to get the proposal to drill into the winter, at least one well during the winter. 

How has that proceeded so that you could diversify? You said it 

was a boom and bust economy, all the people come in for the summer, and you are trying to diversify the impact on the community. 

Has that process concluded? Are you getting that one well in the 

winter? 

Mr. HOGAN. Yes. We received two opportunities to drill with one 

rig during the winter season to try and establish a baseline that 

we could, in fact, do what we want to do, which is to have three 

pads with two rigs on each pad drill during the winter. When we 

receive that, we have had that approved, but when we are actually 

able to implement it this coming winter, then we are estimating 

that will establish the beginning of our 9 years of drilling on a 

year-round basis, which will provide opportunities for members of 

the crews to be able to identify long-term employment and therefore move their families into the area. 

Senator CHAFEE. What year are you in in that process? 

Mr. HOGAN. Excuse me? 

Senator CHAFEE. What year are you in the winter drilling process? 

Mr. HOGAN. We just received approval in November to start. We 

were unable to start the three pad winter proposal until this coming winter. So we currently have commenced the pipeline portion 

of the project. 

Senator CHAFEE. How was the regulatory process at trying to 

make that proposal? 

Mr. HOGAN. It was a fairly long, drawn out procedure. We identified early on that there was a certain element of timidity, I guess, 

on behalf of the BLM to try and take a leading edge. I want to say 

that the BLM office in Pinedale is an excellent office. I do not take 

anything away from them. 

But they were a little skittish about going forward with our proposal fairly independently. So we took it upon ourselves to meet 

with the public on a very concentrated basis, explain our project, 

answer any questions that they would have to try and make sure 
25

that really the critical mass that the BLM needed in order to make 

a positive type of determination was there. 

Senator CHAFEE. Was there concentrated public opposition initially? 

Mr. HOGAN. Well, I would not say it was concentrated. But there 

was some opposition. We spent a lot of time with the conservation 

groups and I think it was a matter of education. Once we got over 

the hurdle of educating them as to the benefits of our proposal, we 

did not receive any opposition. At this point, we have not had any 

litigation filed against our project. So we take that as a form of endorsement. 

Senator CHAFEE. I am sure in all these siting proposals public involvement has its pros and cons. Having been a mayor and going 

through zoning processes, you have to make sure you reach out to 

the neighborhood as the proposal comes forward. I know Cape 

Wind has tried to do that, and the liquid natural gas people have 

as they come up Narragansett Bay, but nonetheless, as politicians, 

we sure hear from our constituents on these issues. Thank you, Mr. 

Chairman. 

Senator INHOFE. Thank you, Senator Chafee. Only we former 

mayors understand that. 

Senator CHAFEE. Front lines. 

Senator INHOFE. Senator Carper left. We will come back to him 

when he comes back. Senator Jeffords, do you have some questions? Our distinguished Ranking Minority Senator Jeffords. 

Senator JEFFORDS. That is better. Thank you. Mr. Robinson, in 

your testimony, you provide a chart that lists the number of State 

and Federal approvals and permits needed for liquified natural gas 

facilities. Can you clarify for the committee which of these are actual permit requirements as opposed to some other review status? 

Mr. ROBINSON. I think we were using the term permit in its 

broad sense. But I believe all of them are, in fact. It is a process, 

a certificate, an authorization, a permit, an OK from an agency 

that our applicants have to go through. Now there is a distinguishing aspect of those permits that is not identified in that chart. 

Some of those are permits that are pursuant to Federal statutes—the Clean Water Act, the Clean Air Act, the Coastal Zone 

Management Act, and others—and many of those are legal predicates for an action to occur at the project, others are not. So there 

is a distinction there. But there is at least a half a dozen of those 

permits which by Federal statute must be acquired prior to any 

construction of a project. 

Senator JEFFORDS. Mr. Duffy, I would be interested in your 

thoughts about how the NEPA process has affected your project so 

far. Do you feel that the process of developing the draft Environmental Impact Statement has increased local community acceptance of the project? 

Mr. DUFFY. I think it has, Senator. NEPA is always a doubleedge sword. It is a difficult, long process, but I think the level of 

public support, in particular from the environmental community, 

has been much stronger now that the draft EIS has been issued. 

I mean, we have always had the strong support of the most respected environmental organizations. But until the draft EIS came 

out, it always was subject to the caveat that it is a good idea pro-
26

vided that the EIS is favorable. Now that it is out and it is showing 

a very favorable conclusion, it has absolutely solidified our support 

in the public. 

Senator JEFFORDS. Thank you. Ms. Buccino, in your experience, 

do you think that the current Clean Water Act, Safe Drinking 

Water Act, and National Environmental Policy Act provide enough 

protection for landowners who live near the energy-production 

sites? 

Ms. BUCCINO. Well, those Acts provide a core of protection that 

is essential. There are issues related particularly to the split estate 

situation where a company has leased the mineral rights underneath the land. Actually legally right now those mineral rights underneath the land trump private property rights on the surface. So 

there is quite a bit of conflict occurring right now primarily around 

coal-bed methane development where drill pads are being put in 

people’s backyards, and the current legal framework does not address adequately those concerns. 

Senator JEFFORDS. To what extent has changing administrative 

guidance on NEPA fueled litigation in an effort to clarify the requirements regarding the content of the Environmental Impact 

Statement? 

Ms. BUCCINO. There has been quite a bit of work actually, administratively to help improve the process. For example, the White 

House, under this Administration, had a NEPA Task Force that focused on implementation—improving implementation—and I think 

they are moving forward with some of those recommendations. The 

White House Task Force on Energy Project Streamlining was referred to earlier, and they have actually done a lot of work within 

the existing statutory framework. 

In fact, they issued a report, it was December 2002, reporting on 

the proceedings of their first year. In that report, they reaffirmed 

that improvements can be made within the existing statutory 

framework, there is no need to change that statutory framework, 

and they have moved forward with Memoranda of Understanding 

to address deep water ports and also pipelines. 

Senator JEFFORDS. Thank you very much. 

[The prepared statement of Senator Jeffords follows:]

STATEMENT OF HON. JAMES M. JEFFORDS, U.S. SENATOR FROM

THE STATE OF VERMONT

Mr. Chairman, thank you for holding this hearing, and a sincere thanks to all the 

witnesses, many of whom have traveled across the country to provide testimony to 

the Committee. The Committee will be examining several very important issues 

today, as we conduct oversight of energy project permitting. 

Though this is the first one this Congress, this is essentially the third hearing 

in the last year in which the Committee has examined environmental permitting 

related to energy projects. In the 108th Congress, we held both a natural gas and 

a gasoline supply hearing in which permitting issues were discussed. 

America needs a reliable, affordable, and environmentally friendly energy supply. 

I’m concerned, Mr. Chairman, that in our desire to adopt a national energy strategy, 

a goal I share, we may yield to premature calls to repeal or revise our Federal environmental laws. These are important laws, important for the health of our citizens 

and our environment. In exercising our oversight responsibility, we must examine 

the effect of environmental laws, if any, on various sectors of the economy, including 

energy industries. 

Of course, however, this Committee’s first and foremost responsibility is to assure 

that the nation’s laws are protective of public health and the environment. It is our 

job also to set performance standards for industries like the natural gas or wind in-
27

dustry that are adequately protective and wherever possible, fuel neutral. These 

standards should not be skewed to protect any one industry, but should encourage 

sustainable economic development. 

We must be mindful that though we benefit from the use of natural gas and wind 

resources to generate electricity, heat our homes, and produce commodities, there 

are costs as well. While we have improved public health by improving our air quality, we are also having real on-the-ground environmental impacts on our country’s 

public and private lands, and our water and wildlife resources. I feel that a good 

understanding of these issues is extremely important. 

I think this is even more the case now that the Senate is putting together an Energy Bill. Therefore, I am pleased that we will hear from witnesses, both energy producers and individuals who have examined energy production sites, about the sufficiency of these laws in protecting the environment. 

Moreover, whatever contribution the costs of environmental compliance has made 

to the overall price of energy development in our country, I am very skeptical that 

these costs are a primary driver behind the recent price fluctuations we have seen. 

We routinely implement our environmental laws in a deliberate and measured 

way. In the case of Clean Air Act and Clean Water Act requirements, all of them 

have been phased-in over long timeframes in consultation with industry. We have 

done this specifically to try to avoid market shocks and price spikes. These are not 

new requirements, they are not a surprise, and the costs associated with meeting 

them are known. 

The National Environmental Policy Act of 1969 has largely been heralded as a 

success as well. It has made Federal agencies take a hard look at the potential environmental consequences of their energy permitting actions. It has also involved the 

public into the agency decisionmaking in a way unlike any other statute. 

We must not sacrifice our environmental laws to pressures from the power industry. The energy future of our nation relies on our ability to find ways to harness 

our current resources in cleaner ways and develop cleaner alternative energy 

sources. 

Thank you again, Mr. Chairman for holding this hearing. In covering the issues 

I have outlined, it will be a comprehensive look at several areas of permitting. I look 

forward to hearing from the witnesses.

Senator INHOFE. The next would be Senator Isakson. I have 

asked if he would Chair the remainder of the meeting, which will 

just go for one round of questions because of something that has 

come up. So I appreciate your willingness to do that, Senator 

Isakson, and you are recognized for your questions. 

Senator ISAKSON. Thank you, Mr. Chairman. Out of respect for 

Senator Carper, in case he does not come back, I will ask a question I think he rhetorically asked in his brief opening statement. 

I guess, Mr. Robinson, it would be for you. What I heard him say 

was a discussion of giving the State a role in the siting of LNG facilities. That implied to me that the States do not now have a role. 

I am not knowledgeable either way. Would you tell me? 

Mr. ROBINSON. I would like to give you one example. We have 

a project proposed in California, the Port of Long Beach, it is the 

SES project. There, the State designated agency for their CEQA responsibilities, the NEPA equivalent, is the Port of Long Beach Authority. They are supposed to gather the information for all the 

other State agencies and act as the agency that prepares the Environmental Impact Statement. They are a cooperating agency with 

the Federal Energy Regulatory Commission in preparing the NEPA 

document that we are doing. 

We were prepared in October of last year to go forward with our 

draft EIS on that project. The Port Authority was not. There were 

more studies that they wanted to do. We agreed, and continue to 

agree, to wait while the Port Authority continues their State process before we go forward with our NEPA document. 
28

The State has a vital role in the siting of LNG facilities integrated into the NEPA process, certainly, as I just demonstrated, 

but also in terms of the permitting that goes on. No LNG facility 

can be sited unless it receives a Coastal Zone Management Act permit granted by the State. The State can stop any LNG facility they 

wish just with that one Act, and that is one of three that they can 

stop a project with. 

Senator ISAKSON. Thank you. I want to be sure to get that in the 

record in case Senator Carper did not get back in. I do not know 

if he had a follow up question, because I am not a mind-reader. 

Mr. Hogan, I would like to ask you a question. Does Questar—

is it Questar, is that right? 

Mr. HOGAN. Yes, sir. 

Senator ISAKSON. Do you do offshore drilling for natural gas? 

Mr. HOGAN. No, Senator, we do not. 

Senator ISAKSON. All right. If anyone at the dais is knowledgeable about offshore drilling, and this again is educational and informative for me, what are the environmental concerns, I understand those with regard to petroleum, but what are the environmental concerns with regard to drilling for natural gas offshore? 

Ms. Buccino? 

Ms. BUCCINO. I will just highlight a few. A lot of them are similar, and it starts with the exploration stage, not just at the production end. There are concerns about the impacts on marine mammals from the seismic exploration, and I think there are also concerns that relate to impacts on tourism and local economies. 

I know there has been a debate about whether the potential impacts are really the same with gas versus oil drilling. I think again, 

that illustrates the importance of the environmental review and 

public participation process, to allow that information to come out, 

to allow the public to digest it, and if the case is made, the public 

accepts it and you can move forward with a project that is not controversial and not opposed. 

Senator ISAKSON. Well that was my reason for asking the question. Georgia has about a 123-mile coastline and natural gas is a 

real premium today and is going to be in shorter supply than it 

now is because of the amount being consumed just in generating 

electricity. As the pressure grows on that, I just was not familiar 

with what the environmental—I know on petroleum, it would obviously be the oil spill and the fracturing and everything else that 

goes on. But it primarily would be to the marine wildlife and the 

esthetics, I take it, more than anything else. Is that correct? 

Ms. BUCCINO. I think that is true. I think it is an area that has 

not been explore fully and the review process can help do that. 

Senator ISAKSON. Thank you very much. 

Senator Clinton. 

Senator CLINTON. Thank you, Mr. Chairman, and I thank the 

witnesses who are here with us today. 

I wanted to just add something for the record, because I know 

my friend Senator Warner was here earlier to discuss his concerns 

with the current permitting process for offshore wind farms, and 

there are several proposals under consideration as part of the energy bill debate to revise that permitting process, which is cur-
29

rently being done by the Corps under section 10 of the Rivers and 

Harbors Act. 

I just want to state for the record that we have a proposal that 

is in the pipeline in New York. The Long Island Power Authority 

has selected Florida Power and Light to build a 140-megawatt 

wind farm off the Long Island coast. This project enjoys strong 

local support, and the permitting process is in midstream. So I 

think it is extremely important that whatever we might do in the 

context of any energy bill, or any other bill where this issue is addressed, we take into account some of the projects that are strongly 

supported and already on their way to going into production. 

I understand Senator Warner’s concerns and I appreciate them. 

Whatever the adequacies or inadequacies of the Corps current authorities may be, my concern is that I do not want LIPA to have 

to start all over again if we change the permitting rules. So I hope 

that the Chairman and all of our colleagues will work with me on 

that in the spirit of this hearing, which is to reduce unnecessary 

roadblocks to energy projects. I would look forward to working with 

Senator Warner and others on the committee. 

I have a few questions for Mr. Robinson, and, Mr. Robinson, it 

is in line with what you have already been testifying about. As I 

believe you know, Broadwater Energy has proposed building an offshore LNG terminal in the New York waters of Long Island Sound. 

There are many concerns on both sides of the Sound about the impact such a facility would have. It is not a huge body of water. It 

is not out in the open ocean. It is an important environmental, recreational, and economic asset. Given the importance of this issue, 

I laid out a number of concerns in a letter that I sent to FERC 

Chairman Wood last week. 

Twenty million people live within 50 miles of the Sound. Obviously, for anybody who has ever been to Long Island, you know we 

have some of the most beautiful beaches, some of the most picturesque towns and villages. The first time, Mr. Chairman, I went to 

Long Island, I told some people where I was going and they said, 

‘‘How can you be going to the beach in New York?’’ So there is a 

lot of education that needs to be done. 

But it is an incredible resource and it is something that we care 

deeply about, because it is also not just recreational and environmental, but economic. There are a number of people who make 

their livelihoods from the Sound. So we have specific concerns 

about the safety and security risks associated with the presence of 

an anchored LNG terminal that could hold up to eight billion cubic 

feet of natural gas. 

So I would like to ask, Mr. Robinson, what is the size of the area 

around the proposed terminal in which release of gas by either accident or attack could result in pool fires or flammable vapor 

clouds? 

Mr. ROBINSON. Well there are two aspects to safety and security 

that you have to consider when you are thinking LNG. One is the 

tanker safety and security, and the other is the terminal itself. We 

actually commissioned a study by ABS about a year, gosh, I guess 

it was a year and a half ago now. That calculation that they came 

up with, which we use as a model for site-specific calculations, was 

in the range of around 4,500 feet for a radiant heat zone of 1600 
30

BTU per square foot per hour. That is a heat rate that if you left 

your skin exposed to it between 30 and 40 seconds and just waited, 

you would get a second degree burn; your clothing would protect 

you. So that is the perimeter of that 1600 BTU per square foot per 

hour is about 4500 feet for a tanker spill at its worst extent, the 

biggest pool expression. 

Sandia Laboratory did a follow up study on that in December of 

last year, and I think their number came out, again in general, it 

has to be applied specifically with the winds and the humidity and 

all the different types of factors that go into the calculation, and 

I believe it was around 5200 feet for that same 1600 BTU expression. 

Senator CLINTON. That is the immediate area where there might 

be pool fires. But the impact would go beyond that immediate restricted area in terms of impact in the water. So how would access 

around the terminal be restricted? What would be the size of a restricted area around this terminal? 

Mr. ROBINSON. That is something that will be looked at in the 

analysis of the specific project, so I cannot answer that now. But 

typically, we are looking at an area for an on-ground land terminal 

of about 21 acres being about what you need to ensure that you 

have exclusion zones that will protect the public in case you have 

a worst case accident. 

Senator CLINTON. Do these calculations take into account a deliberate attack on the terminal from missiles or aircraft? 

Mr. ROBINSON. It is hard to imagine how you would get the worst 

case example that we are analyzing in any way other than if there 

were a direct attack. 

Senator CLINTON. Mr. Robinson, how would this area be patrolled, and by whom? 

Mr. ROBINSON. Well again, through the NEPA process that we go 

through, we involve the State and local experts in this, the first responders, and the Coast Guard is heavily involved in this and they 

develop a waterways security assessment that we incorporate into 

our analysis, and then ultimately, the Coast Guard and ourselves 

put conditions on the proponent that include the development with 

the local responders exactly how the project would be protected, 

right down to do you need to close a bridge while a tanker passes 

under, or do you need six boats around the tanker as it comes in, 

with what type of protective measures that those boats have to employ. All of that is worked out with the site-specific characteristics 

of the project and the people that would be intimately involved in 

that protection. 

Senator CLINTON. My time has expired. But I find it hard to 

imagine how, given the potential site for this project, those kinds 

of concerns could be satisfied. But I appreciate your answers, and 

I would look forward to receiving a response to my letter to Chairman Wood. 

Mr. ROBINSON. Certainly. 

Senator CLINTON. Thank you. 

Senator ISAKSON. Thank you, Senator Clinton. 

Senator Carper. 
31

Senator CARPER. Mr. Chairman, thank you. Mr. Robinson, I welcome you and the other witnesses here today. Thank you all for 

being here and for your comments. 

I seem to recall a number of years ago I think GAO recommended that there be a requirement that all new large LNG facilities be built in remote areas, and I think some kind of prohibition against transportation through densely populated areas. I do 

not know when that recommendation was made, but I am told 

there was such a recommendation. 

I think in your testimony you suggest that in order to effectively 

site natural gas infrastructure, and this may be a quote, ‘‘A rational siting process should be adopted.’’ I think those are your words. 

I would just suggest that the first step in that rational siting process should be rational siting. I understand the economic motives for 

companies, and I do not blame them, to try to get their facilities 

as close as they can to population centers, and if I were in their 

shoes I would be doing that, too. But I just do not understand why 

those same motives should also drive FERC. That is not clear to 

me. 

I just wonder why does, and if I am alleging something that is 

not true, correct me, but why does FERC continue to consider locations like the Delaware River, across the river from where we live, 

or in places like Fall River, Massachusetts? Would not many of the 

problems with State and local governments that you cite be lessened, not by overpowering them, but by trying to rationalize the 

sites that you do approve? 

Mr. ROBINSON. OK. I am trying to think where to start on that. 

The rational siting process is a process that tries to bring officials——

Senator CARPER. First of all, go back to the GAO. Any recollection——

Mr. ROBINSON. I am totally unaware of a GAO recommendation 

like that. What I think you may be speaking of is that in 1979 the 

Pipeline Safety Act had a provision which required the development of regulations for remote siting of LNG facilities. DOT promulgated those regulations in 1980, and the response to that, the 

definition of ‘‘remote siting’’ was the development of these exclusion 

zones which we just discussed. So that constitutes remote siting if 

you can put a terminal in place and look at the impacts associated 

with the 1600 BTU per square foot per hour radiant heat flux and 

protect people from that, that was considered to be remote. That 

went through a review process and it was appealed and all that, 

and it has stuck ever since. 

So that is the only thing prior to about now, because people really have not talked about LNG much in the last 30 years, that I 

know where remote siting came up, and that is how it was handled. 

Senator CARPER. All right. All right. 

Mr. ROBINSON. Now as far as rational siting, first, I would like 

to make it clear that the Commission does not have the profit motive aspect in looking at the siting, but we do have some knowledge 

of the infrastructure needed to deliver gas to regions of the country. In New England, in particular, the problem is that I doubt if 
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we will ever see another pipeline cross the Hudson River, I just do 

not know that will ever happen. 

If you do not, then your capacity for delivery of gas to New England is set. The gas that comes down from Canada is dwindling, 

the play off Nova Scotia did not come in the way they thought; the 

Maritime Northeast pipeline is running I think about two-thirds 

full. The only option—and you have no underground storage in 

New England—is LNG. Underground storage is not geologically 

possible. 

Senator CARPER. Say that again. 

Mr. ROBINSON. You have no underground storage in New England. It is geologically impossible. That is a big component of a 

good gas delivery system which you just really do not have. Your 

storage is all above ground, about 40 LNG tanks spread around 

New England right now, with 10,000 truck loads of LNG moving 

around New England every year right now. The only real addition 

to natural gas that you have in New England that is available is 

LNG. 

Now the problem becomes, where do you find a deep water port 

in New England that can accommodate these ships? There are not 

many available that are not already in use or protected in some 

fashion. So you are basically looking at existing ports with existing 

industrial uses bringing in existing cargos that, in my estimation, 

in many instances are much more hazardous than an LNG tanker. 

Senator CARPER. Are you at all familiar with the Delaware 

River? 

Mr. ROBINSON. I have crossed it. 

Senator CARPER. Did you pay the toll? 

Mr. ROBINSON. Most times. 

Senator CARPER. Our friends from BP, and they are a good company, as you know, but they are interested, along with some folks 

in New Jersey, in building a pier that would stick a couple of thousand feet out into the Delaware River, at least initially they were 

and I think they are having some second thoughts about it. The 

Delaware River is not all that wide in that point and as you go further north. The idea of having a pier that sticks a couple thousand 

feet out into the river is just a cause for concern for a lot of reasons, not the least of those could involve homeland security and potential for some kind of terrorist attack. Is that the sort of thing 

that you all think about? 

Mr. ROBINSON. Oh, absolutely. In fact, that will be a key component of our environmental analysis, to look at river congestion, the 

effects on the economy, if there are any, and how it might be mitigated. Those are the types of public interest concerns, and they 

range from wetlands to economic impacts to endangered species, 

that the Commission has to look at in total in making the judgment whether it is in the public interest to grant an authorization 

for an LNG terminal. 

Senator CARPER. I would kind of like to go back and sort of ask 

this again and ask you to think about it one more time. My final 

question, it is kind of a restating of my earlier question, would not 

many of the problems with State and local governments that you 

cite, I think, in your testimony be lessened, not by overpowering 

them, but by trying to rationalize the sites that you approve? 
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Mr. ROBINSON. Certainly, there is a difference in siting regionally 

across the country. We have LNG proposals that are in populated 

areas where we have absolutely no opposition to them whatsoever. 

We have the same technology being proposed for areas where there 

is enormous opposition, and you are aware of those. That has to be 

accounted for, that has to be taken into consideration, but it has 

to be analyzed in terms of exactly what those impacts are and how 

those people would be inconvenienced, and then that judgment 

made. 

I do not think we can have a national network of energy infrastructure that supports our economy that is based upon a vote at 

the local level. I think that lowest common denominator aspect of 

that would eliminate the ability for regionally significant energy 

projects to be developed where local concerns of, ‘‘we do not want 

it here,’’ would override that. 

Senator CARPER. All right. Thanks very much. Thanks, Mr. 

Chairman. 

Senator ISAKSON. Thank you, Senator Carper. 

I have never chaired a committee before, but I think I am supposed to leave the record open for 5 days in case any member 

wants to submit any additional questions for the record. 

Senator CARPER. Why do we not bring up some legislation and 

see if we can get it through. 

[Laughter.] 

Senator ISAKSON. I know I am not supposed to do that. I suggest 

the absence of a quorum on that. 

Senator CARPER. Unanimous consent, what do you think? 

Senator ISAKSON. I want to thank all the witnesses who testified 

today, and thank the members who attended. 

The committee stands adjourned. 

[Whereupon, at 11:06 a.m., the committee was adjourned.] 

[Additional statements submitted for the record follow:]

STATEMENT OF HON. BARACK OBAMA, U.S. SENATOR FROM

THE STATE OF ILLINOIS

Mr. Chairman, thank you for holding this hearing today. 

Like you, I am very concerned about this country’s energy future. The rising cost 

of natural gas, our dependence on foreign oil, the aging of our coal burning facilities, 

and the daunting prospect of restarting a national dialog on nuclear power are just 

a few of the issues with which Congress must grapple. 

The good news is that there are many new prospects for energy sources, some of 

which will be discussed here today. 

At the same time, however, one of the clear differences between the U.S. and 

many developing nations is our quest to balance economics with a healthy environment. We learned from our early mistakes as an emerging industrial nation and instituted a series of environmental safeguards that have served us well. In our quest 

for streamlined processes, we must be careful not to truncate the roles given different permitting agencies and deprive the public of access to the expertise that is 

vested in those agencies. 

We also must be careful not to needlessly amend the National Environmental Policy Act, one of the pillars of U.S. environmental law and a model for legislation in 

other countries. At the heart of this law are the twin goals of disclosure and informed discussion regarding Federal actions. Through the NEPA process, many interested parties have been given a voice that might not have been heard otherwise. 

I look forward to hearing the testimony of the witnesses. Thank you. 
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STATEMENT OF J. MARK ROBINSON, DIRECTOR, OFFICE OF ENERGY PROJECTS, FEDERAL ENERGY REGULATORY COMMISSION

My name is J. Mark Robinson and I am the director of the Office of Energy 

Projects (OEP) at the Federal Energy Regulatory Commission. I am here as a staff 

witness speaking with the approval of the Chairman of the Commission. Our office 

is responsible for the licensing, administration, and safety of approximately 1,600 

non-Federal hydropower projects; the certification of between 500 and 2,000 miles 

of interstate natural gas pipelines annually; the certification of natural gas storage 

facilities; and the authorization, safety and security of liquefied natural gas (LNG) 

terminals. 

I would like to thank you for the opportunity to speak today on the permitting 

of energy projects. I will focus on natural gas-related facilities. The permitting of 

natural gas facilities is governed by a comprehensive scheme of Federal regulations 

that guarantees that the FERC and other Federal agencies will work with state and 

local agencies, as well as the general public, to ensure that all public interest considerations are carefully studied and weighed before a facility is permitted, and that 

public safety and the environment are given high priority. We are proud of our track 

record of working well with other agencies, the states and with all interested stakeholders on these projects, and are committed to continuing to be responsive and responsible regulators. The comprehensive nature of the FERC’s permitting program 

addresses all siting and operational issues with the full participation of the Federal 

and state agencies while attempting to ensure the timely development of necessary 

energy infrastructure. Timeliness, however, is a virtue that, with some regularity, 

goes by the wayside as a result of a widely distributed decisionmaking process. The 

remainder of my testimony will describe the efforts the Commission has made to 

efficiently process applications, the issues that still detract from our ability to move, 

in a timely fashion, on energy projects that are in the public interest, and a rational 

approach to the siting of energy infrastructure that would improve all agencies’ ability to reach a decision jointly on needed projects. 

I. THE COMMISSION’S PROCESS

The Commission is charged, under the Natural Gas Act and the regulations that 

codify the act, with jurisdiction over the construction of facilities used to transport 

natural gas in interstate commerce and the construction of facilities used for the export or import of natural gas which includes LNG terminals. The fundamental concept that governs our efforts is the early identification of project related issues with 

all parties that would be affected by the development. We believe that a proactive 

approach to issue identification and collaboration among all parties provides the 

best hope of determining whether a project is in the public interest in a timely fashion. 

The goal of the FERC’s natural gas permitting process is to determine if a project 

is in the public interest. As an integral part of this process, FERC staff coordinates 

closely with other agencies and solicits comments and recommendations at several 

points in the review process from Federal, state, and local authorities, and members 

of the public. We do this in order to obtain the broadest possible range of information and views and to accommodate, to the greatest extent possible, state and local 

concerns. 

Prior to a company filing a natural gas-related facility application, company representatives commonly meet with the Commission’s staff to explain the proposal and 

solicit advice. These meetings provide prospective applicants the opportunity for 

Commission staff to offer suggestions related to the environmental, engineering and 

safety features of the proposal. At this stage, Commission staff reviews conceptual 

designs of planned facilities, provides guidance on resolving potential environmental, safety, and design issues, and explains the level of design detail and safety 

analysis required for a complete application. In this manner, Commission staff 

learns about future projects that may be filed at the Commission and helps direct 

companies in their application preparation. I should also note that we encourage 

project sponsors to also make early contact with all other relevant agencies, including state agencies, about their proposals. 

During these early meetings, the Commission staff strongly encourages potential 

applicants to engage in the Commission’s Pre-Filing process. This process involves 

getting the agencies and the applicants to begin the National Environmental Policy 

Act (NEPA) review with FERC well before the filing of an application. The Pre-Filing process provides for early identification of issues, increased Federal, state and 

public involvement, and the opportunity to begin developing consensus and working 

on issue resolution. This process also calls on all agencies to work together concurrently under a schedule set in consultation with those agencies. FERC signed an 
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interagency agreement with 10 Federal agencies in May 2002 that was based on the 

principals of the Pre-Filing process that has fostered a more efficient review of energy projects. However, even though we work extremely well with agencies most of 

the time, there is no force of law in effect with respect to timing of other agencies 

review and issuances of permits. 

Once an application has been filed, the Commission prepares either an environmental assessment (EA) or an environmental impact statement (EIS) to fulfill the 

requirements of NEPA and the Commission’s implementing regulations under Title 

18, Code of Federal Regulations, Part 380. The purpose of these documents is to inform the public and the permitting agencies, and to solicit comments about the potential environmental impacts of the proposed project and its alternatives. A thorough analysis of any substantive environmental issue raised by a proposed project 

is undertaken during the preparation of the environmental document. 

Federal and state agencies and the public play crucial roles in the Commission’s 

authorization process. The Commission works with all stakeholders during the PreFiling process, to identify issues and establish partnerships for developing solutions. 

As part of our NEPA analysis we consider the impact of the project on geological 

resources; soils and sediments; water resources; vegetation; wildlife and aquatic resources; threatened, endangered and other special status species; land use, recreation, and visual resources; socioeconomics; cultural resources; air quality and noise; 

reliability and safety; and cumulative impacts. We also look at alternative locations 

for the proposed facility. This analysis includes consultation with state as well as 

Federal agencies under the Clean Air Act (CAA), the Clean Water Act (CWA), the 

National Historic Preservation Act (NHPA); the Magnuson-Stevens Fishery Conservation and Management Act (MSA), and the Endangered Species Act (ESA). Applicants are also required to consult with and obtain from the state, a determination 

that the project is consistent with the state’s Coastal Zone Management Plan. Attached to my testimony are tables showing the Federal, state, and local authorizations that are required for siting LNG facilities in Texas (31 permits required), Louisiana (29 permits required) and Massachusetts (43 permits required). Further, in 

the course of the NEPA process, the Commission holds public scoping meetings, notifies the public when a draft environmental document is available for review and 

comment, and holds public meetings to receive comments regarding the draft document. These meetings are held near the site of the proposed facility for the convenience of the stakeholders and to build a more complete record. Stakeholders are also 

given the opportunity to intervene and file comments in the proceeding. 

As part of our NEPA responsibilities, we ensure that the appropriate studies requested by, for example, the State Historic Preservation Office are conducted and 

that properties protected by the NHPA are appropriately cared for. We also consult 

with the U.S. Fish and Wildlife Service, NOAA fisheries and the appropriate state 

agencies to avoid, or minimize, the effects of the project on the species that are listed in the ESA and the MSA. We also consult with all relevant state agencies that 

have a role to play in the authorization of the facility. 

We are committed to an early collaborative approach to authorizing energy infrastructure and have designed processes to maximize our potential for efficiently handling projects. Several issues, however, keep us from achieving this objective as consistently as we would like. 

II. CHALLENGES TO THE PERMITTING PROCESS

Underlying the difficulty in efficiently managing the permitting process is just the 

shear number of agencies that have a role in any energy facility siting. As shown 

on the attached tables the authorization of any project can best be described as distributed decisionmaking. Even where an agency has the lead, until the last agency 

acts the first authorization does little good for the advancement of a project. Money 

is not loaned, contracts are not signed and ground is not broken. That is why it is 

critical to recognize this distributed decisionmaking process and modify it by placing 

timing parameters on all participants. Although memorandum of agreements can 

move agencies in this direction, only the potential loss of the agencies authority can 

guarantee that action will be taken in a timely fashion. 

A related issue in timely permitting can be described as extended agency authority. This is where agencies will take the authority they have been granted covering 

an aspect of the project (e.g., water quality under section 401 of the Clean Water 

Act) and utilize that singular authority to duplicate the action of the siting agency 

to make an overall public interest determination. This unnecessary duplication of 

the public interest determination can results in regulatory uncertainty when an applicant does not know which forum will ultimately decide if a project should be constructed. This is not to say that the agencies with permitting authority need to 
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agree with the Commission’s decision, but rather that those agencies should focus 

on their aspect of the project and permit accordingly while leaving the overall siting 

determination to the agency given that exclusive authority. 

Another issue of concern is the growing tendency for parochial, or local, interests 

trumping the greater public good. All siting is local and local concerns are of high 

significance, but if the standard for approving infrastructure requires that there be 

no local opposition for what in most instances are energy projects of regional importance, then no energy infrastructure will be built. An example of this is the state 

of Connecticut’s moratorium on energy projects crossing under Long Island Sound. 

This moratorium prohibited state agencies from issuing a decision on any applications relating to electric power line crossings, gas pipeline crossings or telecommunications crossings of Long Island Sound. This action stops the development of natural 

gas pipelines needed to ensure the reliability of the delivery system to New York. 

This problem is not limited to states, but also shows itself with landowners, towns, 

municipalities and non-governmental organizations. Admittedly, much of the infrastructure proposed today is going to serve the future and those that are comfortable 

with the status quo may not see any direct benefit for themselves. But if our parents and grandparents had taken that same attitude more then a half century ago, 

I doubt we would be traveling on the interstate road system we have today. 

We need a national natural gas system that contains a balance of domestic production and imported LNG deliveries, transportation, and storage. This system will 

serve the greater public at a lower cost. There, of course, are legitimate local concerns, but to adhere to all of their requests to not be disturbed will result in a balkanization of a national network that needs to expand and grow on an integrated 

basis. 

III. RATIONAL SITING PROCESS

In order to effectively and efficiently site natural gas infrastructure that is found 

to be in the public interest and to address the challenges discussed above, a rational 

siting process should be adopted. This process would be equally applicable to the 

siting of any energy infrastructure and consists of three elements: the designation 

of an agency with exclusive authority to site the projects; a requirement that all 

agencies with authority over an aspect of the project work with the lead agency to 

develop one Federal record from which all agency decisions would be made; and direct appeal of all agency actions at one time to the Federal courts. 

Designating one agency as having exclusive siting authority would not usurp the 

decisional authority of the other agencies involved. Rather it recognizes that one 

agency has been vested with the decisional authority to determine whether the proposal is in the public interest while others have been vested with authorities that 

go only to some aspect of the project like affects on water quality or endangered species. This would specifically address the issue of extended agency authority. The recently enacted Alaska Gas Pipeline Act of 2004 specifically addressed this issue by 

distinguishing between the lead agency and other agencies that are handling aspects of the project. 

The development of one Federal record for all agencies is at its core just a matter 

of good government. Currently, at times multiple Federal and state agencies go to 

the effort of developing records covering the same issues under different timeframes. 

Requiring all agencies to work together under the schedule of the lead agency would 

reduce waste, improve decisionmaking, and reduce the potential for conflicting conclusions. The schedule set by the lead agency would have to recognize any statutory 

timing requirements and should work for all, given that the lead agency has to consider all elements while the others would only be dealing with specific aspects of 

the project. Finally, to make this function the agencies need to know that, should 

they not meet the schedule, their permit would be conclusively presumed or waived 

as is now the case with a 401 permit granted by the state under the Clean Water 

Act. 

The final step in the rational siting process would be to require that all actions 

taken by all the permitting authorities be subject to one appeal process. Currently 

appeals can run in many different directions including the state courts, state administrative reviews, Federal courts and Federal administrative reviews. Some of the 

appeals processes involve more than one of the above in a sequential fashion. The 

net result of an appeals process that can run into multiple years is that a project 

once found to be in the public interest will die from a death of a thousand cuts administered one appeal at a time. It is not only enough to approve a project on a 

timely, unified basis, but there is a need to avoid fragmented, multi-layered administrative and judicial review that could unduly delay a final decision on the project. 

This could be accomplished by having all appeals of Federal and state agency deci-
37

sions that administer Federal law reviewed immediately in a single U.S. Court of 

Appeals. 

IV. CONCLUSION

The Commission’s process is designed to ensure the safe, reliable construction and 

operation of natural gas facilities, based on extensive input from all affected parties 

and timely decisions from the relevant Federal and state agencies. Nevertheless, the 

challenges that I outlined in my testimony are threatening to disrupt this process 

and the timely approval and construction of necessary natural gas infrastructure. 

At the present time, the number of LNG and other natural gas infrastructure 

projects filed at the Commission is at an all time high. To respond to this, the 

FERC’s need to coordinate early and effectively with other Federal and state agencies is paramount. While the FERC staff must coordinate early with other agencies, 

so too must those agencies cooperate with FERC—and do so, on the schedule which 

FERC establishes. This is also critically important. The adoption of the rational 

siting process would curb these disruptions and allow the natural gas infrastructure 

to grow as necessary. Natural gas is a crucial component of the nation’s energy 

structure and the timely approval of the necessary infrastructure is vital to meet 

the demands of a diverse and continually growing economy.
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STATEMENT OF DENNIS J. DUFFY, VICE PRESIDENT OF REGULATORY AFFAIRS,

CAPE WIND ASSOCIATES, LLC. 

INTRODUCTION

I Appreciate this opportunity to address the Committee. My name is Dennis J. 

Duffy, Vice President of Regulatory Affairs of Cape Wind Associates, LLC (‘‘Cape 

Wind’’). For the last 5 years, Cape Wind has been developing the Nation’s first offshore wind generation project. The project would be located approximately 5 miles 

off the nearest point of land on the coast of Massachusetts. It would generate up 

to 468 MW of clean and renewable energy, with no fuel requirements and no air 

emissions. This amount would represent approximately 75 percent of the annual 

electricity needs of Cape Cod and the Islands of Martha’s Vineyard and Nantucket. 

The principals of our company have been in the energy business for more than 

25 years. We have developed and operated some of the most efficient gas-fired 

plants operating in the U.S. and we are intimately familiar with Federal and state 

licensing processes for electric power plants. In direct response to State mandates 

for renewable energy, the so-called ‘‘Renewable Portfolio Standard’’, we are now focusing upon wind energy development. We are confident that wind energy technology has now advanced to the point where it is both proven and reliable and can 

play a much more meaningful role in our National supply mix. In order to realize 

the full potential of wind energy, however, we need to ensure that our National energy and environmental policies are implemented in a more consistent manner. 

2. THE CAPE WIND PROJECT

The Cape Wind project would consist of 130 wind turbines located in Federal waters on submerged lands located approximately 5 miles off the coast of Massachusetts, with an aggregate generating capacity of approximately 468 MW. The project 

would be connected to the land-based transmission grid via two 115 KV submarine 

cables. Although it is the first offshore wind energy farm proposed in the U.S., there 

are several operating successfully in Europe. The Cape Wind project would be located on a shoal that is outside of the shipping lanes and would impose no restrictions on current uses of the area. A schematic site map is attached. Cape Wind enjoys strong support of environmental, consumer advocacy and labor groups, and has 

a grass-roots support organization with over 4,000 members. 

3. FEDERAL REGULATORY PROCESS

The Federal regulatory process is thorough and comprehensive, but lacks any 

legal requirements that would limit the duration of the review period. As a result, 

with no required end point, opponents can use stalling tactics to try to financially 

cripple even a project that meets all statutory standards and serves Federal and 

State policy objectives. 

After extensive analysis and long review of sites and conditions, Cape Wind submitted its Federal permit application to the U.S. Army Corps of Engineers 

(‘‘USACE’’) in November of 2001, pursuant to section 10 of the Rivers and Harbors 

Act, as amended by the Outer Continental Shelf Lands Act of 1978. This Act governs the placement of all offshore structures in Federal waters. The project thus has 

been undergoing extensive regulatory and public scrutiny for more than 3 and onehalf years, including the preparation of an Environmental Impact Statement (‘‘EIS’’) 

under the NEPA. 

The US Army Corps of Engineers (‘‘USACE’’) has acted as the lead Federal agency 

in reviewing Cape Wind’s application in a process that has included the active participation of 17 Federal and State participating agencies and which has afforded exceptional opportunities for public involvement. There have been nine public hearings. 

During this process, an exhaustive analysis of all potential impacts of the project 

was conducted, including studies of issues including potential impacts upon existing 

uses of the area; environmental issues, including potential impacts to fish, birds and 

marine mammals; project aesthetics; cost implications; and the energy needs of the 

public. The USACE issued a Draft EIS (‘‘DEIS’’) in November of 2004, including 

more than 4,000 pages of detailed project analysis based upon extensive scientific 

literature and data bases, as well as some of the most extensive field work ever undertaken for a wind energy project. The USACE extended the normal period for 

public comment in the DEIS, and we are now awaiting the USACE’s response to 

such comments and the release of a final EIS (‘‘FEIS’’). 
44

4. STATE REGULATORY PROCESS

In addition, there are extensive, parallel state regulatory proceedings, because the 

project’s transmission facilities must cross state waters in order to be connected to 

the regional power grid. In September of 2002, Cape Wind and the local electric utility jointly petitioned the Massachusetts Energy Facilities Siting Board (‘‘MEFSB’’) 

for authorization to construct those portions of the transmission facilities for the 

project located within the land and territorial waters of Massachusetts. Although 

the MEFSB’s enabling statute requires it to reach its decision within 12 months, 

in this case the review process took more than 2 and one-half years, including more 

than 20 days of expert testimony, as well as an evidentiary record of over 50,000 

pages. 

However, the end of this process finally has been reached. After its exhaustive review, on May 10, 2005, the MEFSB approved Cape Wind’s petition. This decision 

is based largely upon its findings that Cape Wind’s energy is needed (i) to reliably 

meet the growing need for power in the region; (ii) to lower prices to electric rate 

payers; and (iii) to offset air emissions from fossil generators, as follows:

The Siting Board has found there is a need for the power provided by the 

wind farm beginning in 2007 for reliability purposes. The Siting Board has also 

found that: (i) there is an additional need for additional renewable energy resources to meet the requirements of the Massachusetts RPS beginning in 2006; 

(ii) there is a need for the full renewable output of the wind farm to meet the 

requirements of the Massachusetts RPS beginning in 2010; and (iii) there is a 

need for the renewable resources provided by the wind farm to meet regional 

RPS beginning in 2006. The Siting Board further has found that there is a need 

for the power generated by the wind farm for economic purposes during the first 

5 years of operation.

EFSB 02–2, p. 189. More specifically, the MEFSB found that because generating 

units without fuel costs displace higher cost units from dispatch, Cape Wind would 

lead to substantial costs savings to the rate paying public:

The record shows that the wind farm will tend to reduced market clearing 

prices for electricity because it typically will be bid into the market at its marginal operating costs, which are close to zero, than those power plants with 

higher marginal costs. . . Consequently, the Siting Board finds that operation 

of the wind farm will provide average annual savings of $25 million for New 

England customers, including $10 million annually for Massachusetts customers 

during the first 5 years of operation.

Id. at 162. The MEFSB also recognized the environmental benefits of Cape Wind, 

noting that ‘‘the Siting Board finds that, in the near term, operation of the wind 

farm would reduce regional air emissions by approximately 4480 tons of SO2, 1132 

tons of NOx and 1,062,554 tons of CO2 annually . . .’’ Id. at 169. 

5. REMAINING REGULATORY REVIEW

Notwithstanding the extensive review and analysis that has been done over the 

past three and one-half years, the Cape Wind project still faces additional review 

processes of uncertain duration. In particular, after the USACE issued the DEIS in 

November of 2004, it received more than 5,000 comments. Notably, many of the 

leading environmental organizations praised the depth and detail of the DEIS, including the following comments filed by the Conservation Law Foundation:

CLF commends the Corps and the project proponents for providing a fairly 

exhaustive, comprehensive and accurate picture of the range of potential environmental impacts from the project and reasonable alternatives to the project. 

In many instances, the level of scrutiny in the environmental review [of the 

DEIS] exceeds comparable projects with similar profiles but far fewer environmental benefits than the Cape Wind Energy Project.

While most of the public comments were positive, the comments also included demands by project opponents that multiple years of additional field studies be conducted before the issuance of a Final EIS. Some call, for example, for the USACE 

to conduct an expanded alternative study that would evaluate nuclear and fossil 

plant proposals on an equal footing, notwithstanding the fact the Cape Wind is proposed in response to specific legislative mandates for renewable energy. Other comments demanded multiple years of additional bird studies, notwithstanding the fact 

that the Cape Wind DEIS already reflects more extensive avian field research than 

has ever been done for any other energy project of which we are aware, and includes 

more than 450 pages of detailed avian analysis that provides an ample informational basis upon which a reasoned decision can be made. 
45

In addition, the project will be subject to further review under the Massachusetts 

Coastal Zone Management Act for consistency with the enforceable provisions of the 

Massachusetts Coastal Zone Management Plan, pursuant to the provisions of the 

Coastal Zone Management Act, 16 USC 1451, et seq. The Massachusetts CZM Office 

has long been an active participant in the permitting process. 

6. CONCLUSION

The Cape Wind project and other wind energy projects that will follow present 

great potential for meeting the multiple objectives of our National energy and environment policy, including (i) decreasing reliance upon imported fuel sources, (ii) reducing and offsetting air emissions, and (iii) lowering the cost of electricity to the 

ratepaying public, all with minimal environmental impact. Nonetheless, after more 

than 4 years, the schedule for completion of the permitting process is still unclear. 

Based upon our experience, we have two suggestions for improving this process. 

First, National policy objectives would be far better served if the environmental review of proposed facilities were conducted in a more timely manner, perhaps pursuant to specific statutory timeframes that prevent delay tactics from financially crippling an important and worthy project. Second, because the process involves so 

many regulatory agencies with often conflicting regulatory agendas, it is important 

that the process appropriately recognize clearly stated Federal and State energy objectives, as well as the societal tradeoffs inherent to any major energy project. 

Thank you for your consideration.
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PREPARED STATEMENT OF SHARON BUCCINO, SENIOR ATTORNEY, NATURAL

RESOURCES DEFENSE COUNCIL

Good Morning. My name is Sharon Buccino. I am an attorney with the Public 

Lands program of the Natural Resources Defense Council. NRDC is a non-profit 

membership organization with over half a million members and activists across the 

nation. We work to protect the environment for the humans living in it. NRDC 

strives to protect nature in a way that advances the long-term welfare of present 

and future generations. I, like you, want to make energy permitting work better. 

I have had the privilege to work with ranchers, farmers, and homeowners across 

the West as energy development has come to their communities. Domestic energy 

production—the work of companies like Questar—is important. The permitting process is what allows this development to go forward in a way that identifies community concerns and addresses them. The permitting process is what gives citizens a 

voice in the government decisions that affect their daily lives. 

EPA GIVES PEOPLE A VOICE

One statute that is central to energy project permitting is the National Environmental Policy Act, known as NEPA. NEPA was signed into law in 1970 by President 

Nixon. Since then it has served as a valuable tool to produce informed and accepted 

government decisions. NEPA has helped preserve some of America’s most treasured 

places, from the canyon lands of Utah to the old growth forests of Southeast Alaska. 

It has helped citizens protect their communities and enhance the quality of their 

lives. NEPA has helped Federal officials better meet the needs and interests of the 

public they serve. As then Secretary of Energy James Watkins testified to Congress 

in 1992 regarding his decision to defer selection of a tritium production technology: 

‘‘[T]hank God for NEPA because there were so many pressures to make a selection 

for a technology that might have been forced upon us and that would have been 

wrong for the country. . . . .’’

NEPA has improved projects. One project that I participated in involved seismic 

exploration in the Nine Mile Canyon region of Utah. The State of Utah has described the area as ‘‘an outdoor museum.’’ The Bureau of Land Management (BLM) 

describes the Nine Mile Canyon region as an area with ‘‘the greatest concentration 

of rock art sites in the U.S.A.’’ The project involved the use of 60,000 pound trucks 

and explosives to collect data about oil and gas resources in sensitive, arid areas. 

As a result of the review process under NEPA and the National Historic Preservation Act, the company conducting the exploration—Bill Barrett Corporation of Denver—took additional steps to protect the natural and cultural resources in the area. 

The company agreed to additional monitoring and mitigation to make sure that the 

vibrations from their equipment would not harm the irreplaceable Native American 

rock art, kivas and cliff houses. They agreed to limit their activity in areas with 

wilderness qualities. The NEPA process was indispensable in helping Federal land 

managers perform their difficult job of balancing a variety of competing uses of the 

public lands. As BLM manager for the project, Mark Mackiewicz, said, ‘‘I can’t imagine this project without a process like (this).’’ Kenworthy, Tom. ‘‘Oil Projects May 

Get Less Scrutiny,’’ USA Today (May 4, 2005) (Attached as Exhibit 1). 

The Cape Wind project is another good example. Wind energy can help diversify 

our energy supplies and increase our energy independence. It is a critical part of 

a sound energy future. Cape Wind and other offshore proposals for wind electricity 

generating facilities off the East Coast present an opportunity to boost significantly 

the amount of energy produced from renewable sources in the eastern U.S. Indeed, 

offshore wind power is probably the region’s largest untapped renewable energy resource. Developing this resource is essential to help reduce local, regional and global 

air pollution that threatens public health, critical habitat, and the very sustainability of the planet. At the same time, offshore wind energy projects will utilize 

areas of the ocean that are held in common by citizens of the U.S., and, if improperly sited and designed, could pose risks to natural resources in biologically rich 

near shore waters. Renewable energy projects must not—and need—not undermine 

protection of coastal habitats and living marine resources. The review process is a 

critical tool for improving the project and reducing opposition by identifying the concerns of those affected by it and addressing them. 

In addition, NEPA gives state and local governments a voice in Federal decisions 

that affect their communities. One of California’s most valuable resources is its 

coast. Ever since 1969, when a Federal well released huge amounts of crude oil into 

the Pacific Ocean off of Santa Barbara, citizens and local elected officials have 

joined together to protect the coast from offshore oil drilling. In 1987, after its new 

5-year OCS plan went into effect, the Interior Department scheduled its first new 

sale—Lease Sale Number 91—involving over a million acres off the coast of north-
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ern California. Pursuant to NEPA, the Interior Department held hearings in two 

coastal communities. Congressional representatives, state senators and assemblymen, and the state attorney general all expressed opposition to the proposal as did 

Democratic candidates in the upcoming June 1988 Presidential primary. More than 

a thousand citizens spoke on behalf of their coastline at these hearings, which made 

headlines across the country. Following the hearings and a mere 2 days before the 

primary, the Republican candidate for president George H.W. Bush announced that 

he favored postponing the sale until it could be re-evaluated. On June 26, 1990, 

then-President Bush canceled the lease sale (along with another CA lease sale and 

a Florida sale) and announced he would delay drilling off the Pacific coast (as well 

as southwest Florida and Georges Bank in New England) for 10 years. 

More recently, NEPA has continued to help protect California’s coast from drilling. In 1999, the Clinton administration proposed to extend the terms of 36 undeveloped oil and gas leases along the central California coast, off Santa Barbara County— another coastal region of great ecological sensitivity. The Interior Department 

refused to conduct any NEPA analysis on the lease extensions, denying the state 

as well as the general public any opportunity to provide input into whether the 

leases, all of which were at least 20 years old, should be extended or allowed to expire. In another demonstration of the broad-based commitment to coastal protection 

in California, the state, joined by NRDC and other environmentalists, successfully 

challenged the Federal Government’s actions. NEPA gave local communities a way 

to speak up for their quality of life and their local economies. 

If Members listen closely to their constituents, they will find that many, from city 

council members to homeowners, care deeply about NEPA. They care about having 

a say when a highway is proposed through their neighborhood or when the Department of Energy plans to store hazardous waste nearby. As the Seattle Post-Intelligencer reported following the recent April 23 hearing in Spokane, WA, held by the 

newly formed House of Representatives NEPA Task Force, ‘‘The biggest applause 

came when John Roskelley, a well-known mountaineer and former Spokane County 

commissioner, called himself an unabashed supporter of NEPA and added that explorers Lewis and Clark would ‘embrace and strengthen NEPA’ if they were alive 

today.’’ For information on the House NEPA Task Force, see http://

resourcescommittee.house.gov/nepataskforce.htm. 

CONGRESS SHOULD WORK TO ENHANCE THE PUBLIC’S VOICE, NOT SILENCE IT

Yes, we can do better. We can make the energy permitting process more efficient 

and effective. Better means improving public involvement, not curtailing it. It 

means doing more thorough analysis of cumulative and regional impacts, not less. 

It means doing more monitoring and data collection, not less. It means giving Federal land managers the resources to complete environmental reviews and engage the 

public in a timely manner, rather than imposing mandatory deadlines. 

Several provisions in the energy bill now under consideration by Congress move 

in the wrong direction. For example, Section 2055 of H.R. 6 as passed the House 

aims to eliminate the NEPA process, rather than improve it. The provision, promoted by Rep. Peterson (R-PA), provides that numerous oil and gas activities on 

public lands ‘‘shall not be subject to review’’ under NEPA. The provision includes 

well pads less than 5 acres in size, increasing the number of wells in an existing 

field, disposal of water from coalbed methane drilling and seismic exploration. The 

provision’s scope is sweeping. BLM has approved over 30,000 new wells in Montana 

and Wyoming’s Powder River Basin alone. As one BLM official noted, ‘‘Most of our 

drill pads are less than 5 acres. Our average is less than 3 acres.’’ ‘‘Oil Projects May 

Get Less Scrutiny,’’ USA Today (May 4, 2005). The provision could affect offshore 

exploration, as well as onshore. Instead of using the NEPA process to identify and 

address public concerns and potential adverse impacts on their health, lifestyles, 

and communities, proponents of the provision excuse the government and industry 

from listening. 

Another provision of H.R. 6 targets projects relying on renewable resources. Section 1702 limits alternatives, a critical element of NEPA. Public comment is limited 

to the preferred alternative, often the project version as put forward by company 

seeking the permit and a ‘‘no-action’’ alternative. Creative win-win solutions are 

foreclosed. The provision could exempt solid waste incinerators and dams from 

meaningful environmental review. The public deserves a meaningful voice in all energy projects whether using renewable resources or not. 

In addition, Title V of H.R. 6 could remove the application of Federal laws, such 

as NEPA and the National Historic Preservation Act, from energy development decisions on tribal lands. The bill affects land both on and off reservation. It provides 

that once the Secretary of the Interior approves a tribal energy resource agreement 
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providing a process for making energy development decisions, individual energy 

projects would proceed without Federal approval. Since no Federal action would 

occur, the existing guarantees of environmental review and public participation 

under NEPA would be lost. Concerned tribal community members and communities 

adjacent to the project would lose the mechanism that they have now to make their 

voices heard. 

Another piece of H.R. 6 (Sec. 2028) requires the Interior Secretary to approve applications for permits to drill within as little as 10 days of completion, restricting 

the ability of Federal land managers to provide the environmental review and public 

participation required by NEPA. Finally, Sections 1808 and 2014 would allow oil 

and gas companies to conduct their own NEPA analysis of proposed projects—and 

reimburse the companies for doing so. The bill offers no criteria to ensure that analyses would be unbiased and objective. Rather than viewing NEPA as a useful tool, 

proponents of these provisions see NEPA as an obstacle to drilling more public lands 

as quickly as possible. Our public lands can help meet our energy needs and almost 

90 percent of them in the Rocky Mountain West are open for development. NEPA 

is the way to ensure that this development is done right. 

I urge Members of the Committee to work to keep energy legislation clean of provisions that compromise environmental protections and public participation. In addition to the provisions limiting the application of NEPA described above, provisions 

in H.R. 6 that roll back important environmental protections include efforts to: 

• Weaken the Safe Drinking Water Act by prohibiting hydraulic fracturing fluids 

from being considered pollutants of drinking water. (H.R. 6, Sec. 327) 

• Undermine the Clean Water Act by exempting from the ‘‘stormwater’’ requirements all oil and gas construction activities, including construction of roads, drill 

pads, pipeline corridors, refineries, compressor stations, sweetening plants, etc. 

(H.R. 6, Sec. 328) 

• Take authority for health and safety reviews of new oil refineries away from 

the state and local officials who are closest to the needs of their communities away, 

also, from the Environmental Protection Agency experts in public health and hand 

that authority over to the Energy Department, whose primary concern with refineries is that they maximize output. (H.R. 6, Secs. 371–79) 

• Allow more smog pollution for longer than the current Clean Air Act authorizes. Under the existing Act, areas that have unhealthy air are required to reduce 

ozone-forming smog pollution by strict statutory deadlines. If these areas fail to 

meet these deadlines, they are given more time to clean up, but must adopt more 

rigorous air pollution controls. The bill attempts to allow polluted areas to have 

more time to cleanup but without having to implement stronger air pollution controls, placing a significant burden on states and communities down-wind of the 

urban areas subject to this provision. (H.R. 6, Sec. 1443) 

• Mandate that the Interior Secretary provide compensation to Federal lessees 

in instances where the lessee claims that he or she is not being allowed to either 

explore for or develop a Federal lease ‘‘. . . in the lawful manner requested by the 

lessee . . . ’’, if the government has failed to act on a drilling permit application 

within a certain period of time. Leases relinquished under this provision are available for future sale, and can be re-purchased by the former lessee. (H.R. 6, Sec. 

2054) 

Most of these provisions appear to have been left out of the energy bill being considered by the Senate Energy and Natural Resources Committee. I urge you to fight 

to keep these provisions out of the final legislation and help ensure that energy development moves forward in a way that identifies and addresses its adverse impacts. 

WE CAN INCREASE DOMESTIC ENERGY PRODUCTION WITHOUT WEAKENING

ENVIRONMENTAL PROTECTIONS

Energy exploration and drilling is already skyrocketing in the Rocky Mountain 

West. Numerous leases and drilling permits are going unused. Nearly 73 percent 

of the total acreage under BLM oil and gas leases is not in production. In the Rockies alone, BLM data reveal that, while more than 34 million acres have been leased 

to industry, only 11 million acres—32 percent—are in production. BLM has been 

issuing record numbers of drilling permits. The BLM approved 6,130 permits in 

FY04, up from 3,802 permits in the previous fiscal year. Many of these permits remain unused. In the Rockies, BLM data show that 2,489 new wells were drilled in 

FY04, leaving over 3,000 approved permits in the region unused. 

One reason for the unused permits may be the limited availability of drill rigs. 

Industry has exhausted available drilling equipment in North America. Harden, 

Blaine, ‘‘Gas-Drilling Permits in Rockies Outstrip Ability to Tap Resource,’’ Wash-
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ington Post (April 28, 2005). There is also an acute shortage of gas-field workers. 

Charlie Ware, who directs an industry-sponsored school to train field workers in 

Wyoming, reported that energy companies have ‘‘told us that they need 1,000 new 

workers a year for the next 5 years to drill the leases that are out there right now.’’ 

Id. These numbers demonstrate that, contrary to industry complaints, permitting is 

not blocking access to oil and gas on public lands. 

Environmental review and public participation may cost money, but it is a necessary cost of doing business on public lands. Energy company profits are doing just 

fine. In the last quarter, Exxon Mobil’s profits were up 44 percent, to $7.86 billion, 

from the corresponding quarter a year ago. Blum, Justin, ‘‘Oil Majors’ 1st-Quarter 

Earnings Shoot Up,’’ Washington Post (April 29, 2005). Other oil companies’ profits 

are surging as well. ‘‘There’s an embarrassment of riches now that is unavoidable,’’ 

said Lawrence J. Goldstein, president of the New York-based Petroleum Industry 

Research Foundation, Inc. Id. At its annual meeting on May 17, 2005, Questar reported that its shareholders had realized a 141 percent gain since 2002. As industry 

itself has said, we can increase domestic energy production and protect the environment at the same time. NEPA is the way to do that. 

CONCLUSION

Limiting public involvement and weakening environmental review will not avoid 

controversy or improve projects. Using NEPA to address a project’s negative impacts 

on surface owners and communities will do both. At a time when increasing demands are being made on our public lands and our shrinking open space, NEPA 

is needed now more than ever. I remain inspired by the positive vision at the heart 

of NEPA—it is a future where man and nature can exist in productive harmony. 

It is a future where our valuable public lands serve diverse interests. I hope that 

this is a vision that you all share and will fight for as well.
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STATEMENT OF RONALD E. HOGAN, GENERAL MANAGER, QUESTAR EXPLORATION AND

PRODUCTION COMPANY

Good morning. I want to thank you for this opportunity to discuss what I believe 

is one of the nation’s most pressing issues, specifically, what the domestic oil and 

gas industry is doing to meet our nation’s growing energy needs and some of the 

challenges we as an industry face in meeting those needs in a safe and environmentally responsible manner. 

My name is Ron Hogan, General Manager for the Pinedale, Wyoming Division of 

Questar Market Resources a subsidiary of Salt Lake City-Based Questar Corporation, a $5.7 billion natural gas-focused energy company. I am an engineer by training, have worked with Questar for 17 years and have supported the Pinedale project 

for 5 years. 

Questar is an independent energy producer committed to responsible development 

of natural gas throughout the Rocky Mountain West and in other producing basins 

in the country. This year Questar affiliates will safely produce more than 150 billion 

cubic feet equivalent net of natural gas and liquids and provide reliable, domestic 

energy in the form of natural gas to more than 800,000 customers in Utah, Wyoming and Idaho. 

I’m here today to share a personal account of the significant effort Questar is expending to develop natural gas reserves at one of the largest and most important 

natural gas fields in the Lower-48—the Pinedale field in western Wyoming. Specifically, I’d like to describe our efforts to obtain permission to modify our operations 

in order to reduce our environmental impact to levels substantially below existing 

regulations, while increasing worker safety and stabilizing our contribution to the 

local economy. 

Before I proceed, I’d again like to thank this committee for hosting this forum. 

The abundant and reliable domestic energy resources our country enjoys are clearly 

very important to our economy and our national security. 

Our approach to the project, including some of the special technology and innovative solutions I’ll describe shortly, may or may not be applicable to other oil and 

gas development projects, but perhaps our experience can help this committee understand the challenges facing the domestic oil and gas industry in today’s complex 

regulatory environment. 

PINEDALE OVERVIEW AND PREVIOUS OPERATING CONDITIONS

Pinedale is a small, dynamic community in Sublette County, Wyoming with a population under 2,000. Located about an hour south of Jackson Hole in the upper 

Green River Basin, Pinedale is known for its rich outdoor recreational opportunities, 

stunning natural beauty and western hospitality. 

Recently, Pinedale and the surrounding area has become known as much for 

what’s beneath the ground as for what’s on the surface. According to current estimates, there are over twenty trillion cubic feet of recoverable natural gas in the 

Pinedale anticline, which is about one year’s supply of natural gas for the entire 

country. In fact, natural gas from this subsurface geological feature currently provides more than two percent of the nation’s entire natural gas supply, a figure that 

will increase in future years as the field is developed. It’s also useful to note that 

there is sufficient clean natural gas in this country to meet our energy needs for 

generations to come. The only question is whether or not we have the determination 

and will to recover it in an environmentally responsible way. 

Questar knows Wyoming and Pinedale well. We’ve been exploring for, producing, 

transporting and distributing natural gas in the State for more than 80 years and 

drilled our first well in Pinedale in 1963. 

Early wells at Pinedale were pretty anemic. We knew there was lots of gas in the 

ground, but we couldn’t figure out how to get it out. Technological advances in the 

early nineties allowed economic recovery of gas from so-called ‘‘tight gas sand’’ reservoirs, spawning a dramatic increase in development of unconventional natural gas 

accumulations that were previously deemed uneconomic. By 1997, we began to realize Pinedale’s true potential, but since most of our leasehold there was on Federal 

land the environmental impact of our activity needed to be throughly evaluated before we could begin full-scale development. 

In July 2000, the Pinedale field office of the Bureau of Land Management published an environmental impact statement and a record of decision that outlined the 

guidelines and restrictions for oil and gas exploration and development on the 

Pinedale anticline. This record of decision was the result of a comprehensive process 

under the national Environmental Policy Act that included signficant public involvement. Questar participated in this process and, even though our leases date back 

to the early 1950s and were not issued with any restrictions or stipulations, we 
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agreed to develop our Pinedale acreage in a manner consistent with the established 

restrictions. 

Among the many guidelines imposed by the record of decision was a restriction 

that prohibited drilling operations during winter months to minimize possible disruption to wintering deer herds, other wildlife and their habitat. 

To meet these restrictions, Questar was forced into a condensed, summer-only 

drilling and construction schedule. This required us to operate as many as fifteen 

drilling rigs at once to drill only twenty-five wells during the summer season. Under 

these restrictions, we projected it would take nearly two decades just to fully develop the gas reserves available on our acreage, thereby significantly delaying the 

delivery of a much needed gas supply to our customers. 

While operating within these restrictions, we witnessed some of the unintended 

consequences of the summer-only drilling and construction schedule. 

For instance, the shortened season made it unfeasible and cost-prohibitive to 

apply available disturbance-limiting technologies like directionally drilling multiple 

wells from a single well pad. 

Also, it was difficult for us and our contractors to hire, train and retain quality 

employees due to the seasonal, part time nature of the work. This, in turn, created 

an annual boom-and-bust economic impact on the local economy as employees and 

contractors flooded the area in the summer during the height of the tourism season 

and disappeared in the winter months when local businesses could most use the revenue. 

Perhaps most importantly, winter restrictions made better environmental mitigation measures economically unattractive or, in many cases, physically unattainable. 

For instance, the seasonal activity required us to use more well pads to quickly drill 

vertical wells, thereby creating more surface disturbance over a longer period of 

time and making it difficult to manage impact on wildlife and habitat. 

We did not feel these unintended consequences were the goal of the Bureau of 

Land Management’s record of decision. Therefore, Questar voluntarily offered to the 

BLM to engage in a multi-year, multi-million dollar effort to explore ways that we 

could: 

—Leverage the benefits of new technology; 

—Minimize environmental impacts; 

—Enhance the safety of operations; 

—Stabilize impact on the local economy; and, 

—Meet or exceed the established goals for protection of local wildlife and habitat. 

RATIONALE FOR YEAR ROUND OPERATIONS

The first step in our effort was to submit a request to the BLM for a permit to 

operate one drilling rig during the winter of 2002–2003. This very limited, one-year 

request would allow us to gain valuable scientific data and technical insight into 

whether a year round development approach could help avoid the unintended consequences of summer-only restrictions. 

In addition, we also voluntarily agreed to fund a study that would help determine 

the real impact, if any, of natural gas development on wintering deer populations. 

Since there was virtually no scientific data available, this study independently conducted by biologists from the University of Wyoming and Wyoming Game and Fish 

would provide information wildlife managers needed to make science-based decisions in the future. Furthermore, the data gathered might open up new options for 

beneficial wildlife and habitat mitigation programs. 

Our request for an exception to the winter drilling restrictions was approved by 

the BLM for the winter of 2002–2003, as was a similar request for a one rig, one 

winter exception for 2003–2004. 

On April 15, 2004, we formally submitted a comprehensive proposal for long-term 

year round operations, with certain restrictions, on Questar’s acreage. This proposal 

was based on thorough internal analysis, a track record in the field from two winter 

seasons and newly available scientific data. 

BENEFITS OF YEAR ROUND OPERATIONS

I want to provide some quick highlights of our proposal so you can get an idea 

of the scope of our request. 

—First, we proposed investing more than $200 million in directional drilling—

that’s $200 million more than would typically be invested to develop this resource. 

This directional drilling technology, common in offshore development, allows us to 

reach multiple underground locations from a single pad, thereby greatly minimizing 

surface disturbances and associated environmental impact. The benefits of directional drilling can only be realized by conducting drilling operations year round. Re-
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moving rigs each winter and reoccupying the same location the following spring 

forces enlargement of the surface pads for safety and operational reasons, effectively 

eliminating any benefits achieved from this costly approach. 

—Second, we proposed expanding both the scope and duration of the ongoing deer 

study. Information gathered during winter operations should provide wildlife biologists, government officials and industry with the scientific data necessary to help 

design energy development projects that minimize disruption to wildlife and habitats. 

—Third, we proposed building a $25 million water and condensate pipeline system. These pipelines would gather and transport the produced water and condensate a liquid hydrocarbon very similar to gasoline that comes out of the ground with 

the natural gas off the winter habitat area. This pipeline system eliminates the 

need for transport of these products by tanker trucks which, in the absence of the 

pipeline, would have to visit the field year round, traveling through the middle of 

wildlife habitat and the local community. In fact, we estimate that at peak production from just our acreage, this system will eliminate more than 25,000 tanker truck 

visits in a single year. The result will be a significant reduction in traffic and air 

emissions from levels originally anticipated by the BLM. 

—Fourth, we eliminated the need for flaring during our well completion operations. Flaring is used to clean up the production stream from new wells to remove 

the water and sand we use during the completion process. We figured out a way 

to trap all the water and sand in closed containers while sending the gas straight 

to the sales pipeline, thereby eliminating noise and likely additional local air quality 

impacts. 

—Lastly, we invested in the little things essential for a safe and responsible operation. These included busing our contractor’s employees during the winter months 

and trucking necessary materials in bulk to the rigs in the fall to decrease traffic 

in wintering wildlife areas. 

In summary, our proposal included investments of more than $200 million in onsite mitigation and outlined an approach that was scientifically based and field-tested. These investments further minimize the environmental impacts of our development and offer substantial benefits over the restrictions imposed by the 2000 

Pinedale record of decision. 

NEIGHBOR-2-NEIGHBOR APPROACH TO PUBLIC INVOLVEMENT

To facilitate a thorough review and analysis of our proposal we worked closely 

with local BLM officials, biologists and experts from Wyoming Game and Fish and 

other elected and appointed officials. We received formal support of our proposal 

from Wyoming’s Governor Dave Freudenthal, the Wyoming Game and Fish Department, U.S. Senator Craig Thomas, Wyoming State Representatives Monte Olsen 

and Stan Cooper, Pinedale Mayor Rose Skinner, as well as the Sublette County 

Commissioners, the North American Grouse Partnership and Trout Unlimited. 

We also recognized that the Pinedale community needed to be involved in the decision-making process. In November of 2003, nearly 6 months before formally submitting our proposal to the Bureau of Land Management, we launched our ‘‘Neighbor-2-Neighbor’’ outreach program. This effort operated on a simple premise we 

would meet anytime, any where with anyone to discuss our plans, lay out the rationale of our proposal, listen to feedback, and work cooperatively to identify opportunities to make our proposal even better. 

We also recognized that in order to establish trust and credibility, the people actually responsible for implementing the project needed to be actively involved and visible in the community. 

By the time we formally submitted our proposal in April 2004, we hosted more 

than 150 discussions and met with more than 500 interested stakeholders. These 

meetings not only allowed us to share timely information, they also generated new 

ideas that were incorporated into our proposal. For instance, building the condensate and water pipelines and including flareless completions as part of our efforts 

were, in large part, due to input received from local community members. 

We found this proactive approach, which went above and beyond mandated requirements for public involvement, allowed us opportunities to establish stakeholder 

relationships, correct any misperceptions that existed and educate everyone on how 

best to share their feedback with officials tasked with making the final decision. 

CURRENT STATUS AND FINAL THOUGHTS

In November 2004, the Bureau of Land Management officially approved our request for site-specific, limited year round operations with six rigs drilling wells from 

three surface pads during the winter. With this approval, we are now working to 
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deliver the many benefits I described earlier, including: Reduced surface disturbance, reduced duration of drilling operations, reduced environmental impact, generation of beneficial scientific data, enhanced safety and stabilized impact on the local 

economy. 

I am proud of Questar’s Pinedale project. Our company has committed to invest over $200 million dollars to achieve benefits significantly above and beyond those 

required by existing regulations. Many of our employees, including myself, have 

spent thousands of hours and have stepped way outside normal roles and responsibilities. 

But even with this commitment, our proposal is constantly at risk of not becoming 

a reality. We continue to get bogged down in a complex web of overlapping jurisdictions and a maze of regulatory requirements that many times simply defy logic. 

When you add to the equation those that take advantage of regulatory complexity 

to delay, litigate and obstruct any energy development project, at times it’s tempting 

to give up. But we don’t want to, because the benefits of successful implementation 

of this project are a win-win for the environment, the community, and the nation, 

which desperately needs the benefits of domestically developed clean natural gas. 

On behalf of Questar’s entire Pinedale project team and our neighbors in Wyoming, thank you again for this opportunity. 

STATEMENT OF THE INDEPENDENT PETROLEUM ASSOCIATION OF AMERICA

This Testimony is submitted on behalf of the Independent Petroleum Association 

of America (IPAA). IPAA represents petroleum and natural gas producers, the segment of the industry that is affected the most by permitting delays associated with 

oil and natural gas exploration and production energy projects. 

Before presenting specific information on energy permitting, it is important to understand the nature of domestic oil and natural gas exploration and production and 

the role of independent producers. Independent producers are companies that explore for and develop oil and natural gas. Typically, they only operate in these aspects of the petroleum and natural gas industries. There are approximately 7000 

independent producers who are predominately small businesses employing an average of 12 employees each. However, they drill approximately 90 percent of the nation’s oil and gas wells. 

Domestic petroleum and natural gas production has changed over the years, particularly since the mid-1980s. Maturing production areas in the Lower-48 states and 

the need to respond to shareholder expectations have resulted in major integrated 

petroleum companies shifting their exploration and production focus toward the offshore in the U.S. and into foreign countries. More and more, these large companies 

must rely on large producing fields that are found only in frontier areas. Consequently, the role of independents is increasing in both the Lower-48 states and 

in the near offshore areas. For example, the independents’ share of Lower-48 states 

petroleum production has increased from 45 percent in the mid-1980s to over 60 

percent by 1995—and these states, despite their mature fields, still account for 60 

percent of domestic oil production. Similarly, independent producers account for 85 

percent of overall domestic natural gas production. These trends will continue. The 

nation will need a strong independent exploration and production industry to meet 

it future needs. 

IPAA supports efforts by the Committee on Environment and Public Works to review the permitting process for energy projects. Specifically, it is important to recognize that the permitting process on Federal lands is a mosaic of regulatory programs 

that require critical coordination between different Federal agencies and in many 

cases involve different laws that task these agencies with different agendas. These 

competing agendas need to be coordinated if the Nation is to meet its energy objectives. Overlaying all of these individual laws is the National Environmental Policy 

Act (NEPA) that sets vague requirements for the consideration of environmental 

issues within the Federal permitting process. One key objective of NEPA is the task 

of assuring adequate stakeholder participation in the Federal decisionmaking process. This is an important and essential objective. However, because the NEPA process has largely been defined by Executive Orders, rulemakings, and judicial decisions, it has become an unwieldy and uncertain process. Moreover, it is essential 

that Congress reiterate that its purpose is to assure stakeholder participation not 

the prevention of decisions. 

In this context IPAA is concerned about several comments included in the testimony by the Natural Resources Defense Council (NRDC) that mischaracterizes several provisions in the House passed Energy Policy Act of 2005 (H.R. 6). 

For example, NRDC states:
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1Section 1808 relates to geothermal operations, not oil and gas. 

Section 2055 of H.R. 6 as passed the House aims to eliminate the NEPA process, rather than improve it. The provision, promoted by Rep. Peterson (R-PA), 

provides that numerous oil and gas activities on public lands ‘‘shall not be subject to review’’ under NEPA. The provision includes well pads less than 5 acres 

in size, increasing the number of wells in an existing field, disposal of water 

from coalbed methane drilling and seismic exploration. The provision’s scope is 

sweeping. BLM has approved over 30,000 new wells in Montana and Wyoming’s 

Powder River Basin alone. As one BLM official noted, ‘‘Most of our drill pads 

are less than 5 acres. Our average is less than 3 acres.’’

IPAA believes that this section actually limits NEPA only for seven specific situations all but one of which have already been through the NEPA process. The one 

exception would be water discharged through an NPDES permit, an action that requires its own permit review process. In the other cases there would be at least one, 

if not two, NEPA analyses conducted. For example, in the 5 acre case, the Resource 

Management Plan (RMP) for the area would have been done under NEPA. In most 

cases the leasing decision would be subjected to a second NEPA review. Later, in 

its testimony, NRDC refers to the issuance of over 6000 Applications for Permits 

to Drill (APDs) in 2004. Implicitly, NRDC argues that each of these should have 

still one more NEPA review. Once (RMP) should be enough; two (leasing) becomes 

overkill; three (APD) is clearly an effort to delay. This type of effort to use NEPA 

to delay action goes well beyond the intent to assure that stakeholders’ positions are 

understood by the Federal decisionmaker; it hopes to use the NEPA process to prevent action. 

Further in its testimony, NRDC states:

Another piece of H.R. 6 (Sec. 2028) requires the Interior Secretary to approve 

applications for permits to drill within as little as 10 days of completion, restricting the ability of Federal land managers to provide the environmental review and public participation required by NEPA.

This comment is actually pointed at Sec. 2027. What really happens is that BLM 

would have 10 days after an APD is submitted to tell the applicant if it is complete 

or not. If it is complete, the Bureau of Land Management (BLM) would have 30 

days to issue or defer issuance if additional information (e.g., NEPA documents) is 

needed. If additional information is needed, it must be submitted in 2 years. When 

the additional information is submitted, BLM would have 10 days to issue the permit. Clearly, this section was drafted with the idea that NEPA had to be met to 

allow the APD action to take place. 

NRDC goes on to state:

Sections 1808 and 2014 would allow oil and gas companies to conduct their 

own NEPA analysis of proposed projects—and reimburse the companies for 

doing so. The bill offers no criteria to ensure that analyses would be unbiased 

and objective.

This comment misstates the issue. What has happened is that BLM has not had 

adequate funds to do all its NEPA documents. Instead, producers have had to pay 

for the NEPA documents to get their permits. The documents are done under BLM 

standards at BLM direction. Companies provide the money but do not control the 

process. Sec. 20141 would allow them to recover these costs through reduced royalties if the project is successful. In passing NEPA in 1970 Congress decided that 

NEPA documents were a Federal responsibility; however, to meet this responsibility 

there must be funds available to the agencies. Adequately funding BLM would 

eliminate the need for this provision. 

NRDC concludes this paragraph with the following comment:

Our public lands can help meet our energy needs and almost 90 percent of 

them in the Rocky Mountain West are open for development. NEPA is the way 

to ensure that this development is done right.

This statement reflects a common NRDC misstatement. It refers to a study conducted by the Department of Interior under the Energy Policy and Conservation 

Act. What this study really says is that about 12 percent of natural gas reserves 

underlie parks and wilderness areas. It then identifies that another 25 percent is 

constrained by stipulations at the leasing stage. It does not address stipulations at 

the permitting stage. 

No one is suggesting the NEPA should not apply. The broader issue, however, is 

whether NEPA is being done right or being abused. As the Congress grapples with 

the need to balance effective stakeholder participation in the Federal decisionmaking process and the need to produce its national resources, it should look be-
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yond the broad objectives of NEPA. It needs to consider the application of NEPA 

in the real world of the Federal permitting process, in a world that puts conflicting 

mandates on the consenting and concurring agencies. It needs to grapple with this 

mosaic of laws and regulations and seek ways to improve the decisionmaking process. All the stakeholders need to be heard, but no stakeholder should be able to stop 

the process through manipulating it. 

IPAA appreciates the opportunity to submit this testimony. 

STATEMENT OF SUSAN NICKERSON, DIRECTOR, ALLIANCE TO PROTECT

NANTUCKET SOUND

Senator Inhofe and members of the Committee, thank you for this opportunity to 

submit testimony to the Committee regarding the need for streamlining the siting 

and review process for power projects. Improving the efficiency and effectiveness of 

the procedures for reviewing energy projects is an important goal, which we support. 

However, the most efficacious way to streamline the review process in a manner 

that respects and protects the environment is by first requiring a thorough environmental analysis of the technology and a general siting assessment, so that agencies 

and developers of site-specific projects can rely on programmatic decisions and a 

general data base that eliminates sites that are unacceptable, sets standards to 

guide decisions and provides the basis for accelerating the review of individual 

projects. This approach is tried and true in energy project contexts such as offshore 

oil and gas and offshore wind, and it is essential in situations where Federal land 

and resources are to be used for the power projects involved. The Bureau of Land 

Management fully understands the value in such an approach, and has effectively 

implemented it in the context of on-shore wind energy development. 

Unfortunately, the lessons learned from these approaches have been lost on the 

U.S. Army Corps of Engineers, which is currently implementing an unstructured, 

ad hoc, highly controversial and contentious process in the context of offshore wind 

energy in New England. This issue is extremely important to Cape Codders, where 

we face a substantial threat by Cape Wind Associates (CWA), the private developer 

testifying here today, to develop a massive marine industrial facility in the middle 

of Nantucket Sound without adequate review or protections for the public trust. 

Concerned citizens living on Cape Cod and the Islands established our organization, the Alliance to Protect Nantucket Sound (APNS), in 2002 to oppose development in the Sound and to fight for its long-term protection and conservation. Motivated by its desire to take advantage of the unique physical characteristics offered 

by Nantucket Sound that would allow it to maximize its profit margin, CWA has 

attempted to downplay or ignore the numerous other unique ecological, cultural, 

economic, historic, and scenic values those very same physical characteristics generate and support. CWA’s proposed development will irreparably harm these very 

values, a fact which CWA has attempted to downplay, ignore or hide during the entire review process. 

CWA has complained before you today that there is no end in sight to the review 

process it is undergoing, that its review has been thorough and extensive, and that 

the existing system allows project opponents to employ dilatory tactics. In fact, this 

is a problem largely of CWA’s own creation. Its choice to develop the nation’s first 

and the world’s largest offshore wind energy plant in the middle of one of the nation’s most prized marine ecosystems, through a process that virtually every other 

knowledgeable party agrees is inadequate, under the jurisdiction of an agency that 

itself admits to having insufficient expertise set it down a bumpy path of uncertain 

duration. 

On November 21, 2001, knowing that Congress had not authorized the development of offshore wind, CWA nonetheless applied to the Corps for a permit to construct its wind energy power project on Horseshoe Shoal in Nantucket Sound. CWA 

attempted to locate its plant entirely within Federal waters, so that the Commonwealth of Massachusetts would have little control over the project, despite the incredible importance of the Sound to the Commonwealth’s economy. Nantucket 

Sound has, in fact, been under consideration at various times for national marine 

sanctuary status, beginning in 1980 and remaining today on the list of candidate 

areas. The Commonwealth designated the surrounding state waters as a State marine sanctuary more than thirty years ago and prohibited therein the development 

of power plants and other structures that would alter or endanger the ecology or 

appearance of Nantucket Sound. Despite the obvious intent of the Commonwealth 

to protect Nantucket Sound, ‘‘[a]fter extensive analysis and long review of sites and 

conditions,’’ CWA somehow identified the area as an ideal location for industrial development. 
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1Despite the lack of authorization, the Corps has explained its position as follows: 

Our regulations specify that we do not get involved in property rights issues. It is the applicant’s responsibility to ensure they have the necessary property rights. It is not our responsibility to tell them what property interests they need to acquire. So we did not spend any time 

researching that issue any further. Our regulations are clear that we do not address property 

rights issues. It may be that’s an issue that needs to be addressed in the legislative branch of 

government. That if in fact there is a gap that the people perceive, that is something that the 

Congress will need to decide whether or not they want to address it. 

Massachusetts Technology Collaborative Meeting, (Jan. 8, 2005). 

The primary vehicle for CWA’s ‘‘thorough and extensive analysis’’ is an 1899 law 

administered by the Corps regulating impediments to navigation. This century-old 

law is the sole source of authorization CWA intends to obtain a massive proposed 

power facility, which would consist of 130 417-foot tall wind turbines laid out in a 

grid spanning 24-square miles of Federal waters. Nothing in the statute addresses 

energy development, and indeed, no statute or regulation at all relevant to using 

public lands or energy development appears to apply to the proposed project. The 

Federal Government has not authorized CWA to use the outer continental shelf 

(OCS) for its proposed development, and the Corps itself admits that it has no 

power to grant any entity a property right to use the OCS. 

Rather than suspending review of the application, the Corps has been in the process of reviewing the project and conducting an environmental impact statement 

under the National Environmental Policy Act (NEPA).1 From the outset of the 

NEPA process, the Corps has allowed CWA to dictate the review process, including 

determining the purpose and need for the project, the scope of the alternatives analysis, and the scope of the studies required. The consequences of allowing CWA to 

dictate the process were evident in the draft environmental impact statement 

(DEIS) generated by the Corps. In fact, contrary to CWA’s testimony, most did not 

praise the depth and detail of the DEIS, but instead complained about the numerous deficiencies in the document. For example: 

U.S. Environmental Protection Agency:

‘‘We do not believe that the DEIS provides enough information to fully characterize baseline environmental conditions, the substantial environmental impacts 

of the proposed project, and alternatives that avoid or minimize those impacts. 

Without this information we do not believe an adequate mitigation and monitoring plan can be developed, nor can a decision be made as to whether the 

project is environmentally acceptable or in the public interest.’’ 

‘‘[W]e recommend that the Corps prepare a supplemental DEIS.’’

U.S. Geological Survey: 

‘‘In many cases ‘conclusory statements’ regarding environmental impacts of 

the proposed [CWA project] cannot be supported by the data collected and analyses done. While some sections appear to have been done reasonably well, others are not and in certain regards the DEIS is at best incomplete, and too often 

inaccurate.’’

U.S. Fish and Wildlife:

‘‘[W]e believe this DEIS is insufficient to provide the information necessary 

for the Corps to make a decision in the public interest. 

Based on our review, significant additional information needs to be developed 

to assess the impacts of the proposed action on resources under our jurisdiction 

and expertise, and to identify actions which will adequately address those effects. This may be best accomplished through a Draft Supplemental Environment Impact Statement for public review.’’

Cape Cod Commission:

‘‘The Commission Subcommittee has a variety of concerns about the analysis 

and methodology employed in reaching conclusions in the DEIS/DEIR. This results in many questions regarding the validity of the conclusions reached and 

the appropriateness of the study. The Commission Subcommittee concerns can 

be grouped into the following areas: Incomplete—Flawed Assumptions; Lack of 

independent assessment—lack of transparency; Balance of conclusions; and 

Lack of quantitative information.’’ 

‘‘[I]t is the recommendation of the Subcommittee that a SUPPLEMENTAL 

DEIS/DEIR be prepared . . .’’

Attorney General Tom Reilly:

‘‘A similar point can be made about the sufficiency of the existing regulatory 

process. Proponents point to the lengthy environmental review process that is 

underway. But the length of the process cannot make up for the flaws that lie 
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at its core. The current process includes no prospective planning of where we—

as a society—want to put our off-shore wind farms.’’ 

‘‘In sum, the DEIS is an inadequate document, that resulted from a flawed process, that was based on an invalid understanding of the underlying law.’’ 

Massachusetts Division of Fisheries & Wildlife:

‘‘The amount and design of the fieldwork conducted was insufficient to demonstrate avian use of the waters and airspace of Nantucket Sound, much less 

to evaluate risk.’’ 

‘‘The analyses (e.g., passage rates, facility rates, radar work) as presented in 

the DEIS-DEIR are cursory, simplistic, and sometimes inaccurate. At times the 

calculation methodology is not transparent, and some calculations contain procedural/mathematical errors that generally result in (sometimes vast) underestimates of bird use in the area.

Massachusetts Audubon:

‘‘Adequate information has not been provided on some key aspects of avian, 

bat, and marine impacts . . . Much of the data that is presented is characterized by insufficient or flawed analysis.’’ 

‘‘Additional information should be provided and the public should be given the 

opportunity to review and comment on material through a Supplemental DEIS 

. . .’’

The Humane Society of U.S.:

‘‘Much more data and analysis than were provided in the DEIS/DEIR are necessary to determine whether Nantucket Sound is an appropriate location for one 

of the nation’s first offshore wind farms. We believe that, at a minimum, a supplemental DEIS/DEIR is required.’’

Sierra Club Massachusetts Chapter:

‘‘The Club believes that the Army Corps of Engineers has done a reasonable 

job in pursuing a rigorous and comprehensive process for a project area that 

lacks Federal and state guidelines. However, because of this lack of guidelines, 

the regulatory framework the Corps currently has available for siting and permitting offshore wind facilities is nowhere near a full-fledged and adequate 

process.’’ 

‘‘The DEIS does not carry out a sufficient analysis of alternatives to the proposed project.’’ 

‘‘The Cape Wind project should not be ‘grandfathered’ but be subject to the 

process as the process evolves . . .’’

The review of CWA’s proposed project is a model of agency mismanagement. It 

demonstrates the hazards of proceeding in an ad hoc manner, without an adequate 

regulatory regime in place, and without an overarching environmental review of the 

technology proposed for development. It is also precisely the approach one should 

take if a process fraught with controversy, delay, and confusion is sought. By allowing a project applicant to dictate the scope of review, the Corps has produced a document that undermines the public’s faith in the Federal review process, will require 

substantial additional work to comply with NEPA, makes possible a decision that 

will have serious adverse environmental and economic consequences, and fundamentally hinders the development of an industry of substantial potential and importance 

to the nation. 

What is required is, first and foremost, is authorization for the type of development involved. The approach currently considered for this purpose in H.R. 5, the 

House energy bill, is not adequate for this purpose because it fails to provide for 

adequate standards and includes special interest legislation that would accord favored treatment to the Cape Wind project itself. Second, to streamline the review 

process, it is critical that a programmatic review of the type of development involved 

be conducted before individual projects are considered. The advantages of this approach manifold. As Conservation Law Foundation has noted in the context of offshore LNG facilities on May 5, 2004, an ‘‘ad hoc approach has not been effective 

and will continue to founder. It has pitted New England communities against one 

another in wrestling with the merits and the risks of specific proposals.’’ The most 

appropriate vehicle for such a review is ‘‘the development of a programmatic environmental impact statement’’ under the National Environmental Policy Act, which 

is used to evaluate ‘‘broad actions geographically (e.g., by region) or generically (e.g., 

common timing, impacts alternatives), and anticipates that connected, cumulative 

or similar actions should be evaluated in a single EIS.’’ ‘‘CLF believes that undertaking a regional approach to LNG terminal siting represents an important opportunity to address this controversial issue in a strategic manner and propel consideration beyond the current, site-specific, polarized siting debates.’’ 
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BLM has reached the same conclusion with respect to onshore wind:

The proposed Wind Energy Development Program policies would establish a 

comprehensive mechanism for ensuring that the impacts of wind energy development on BLM-lands would be kept to a minimum . . . These elements of the 

program, along with the proposed amendment of land use plans, would likely 

result in shorter time lines and reduced costs for wind energy projects, thereby 

facilitating development. 

In terms of facilitating wind energy development, implementation of the proposed action is expected is expected to minimize some of the delays that currently occur for wind energy development projects and reduce costs. In addition, 

the proposed program would ensure consistency in the way [right-of-way] application and grants for wind energy development are managed. These benefits 

would be realized as a result of the emphasis onsite-specific and species-specific 

concerns during the project-level environmental analyses, the amendment of numerous land use plans to address wind energy development, and the potential 

to tier future NEPA analyses off of this PEIS and decisions in the resultant 

[record of decision].

This approach is no less necessary with offshore wind energy development. With 

a structured regulatory regime and programmatic review comes certainty and efficiency. Both are needed to encourage development. The Cape Wind project might 

have come to symbolize the promise of offshore wind energy, but it has instead set 

back the development of offshore wind energy for years. This is because, as Cape 

Wind has testified to this Committee, it is trying to fast-track the review of its own 

project, to the detriment of the environment and the kind of programmatic review 

that would protect special places like Nantucket Sound while identifying the appropriate locations for such development and establishing the framework for expedited, 

efficient, site-specific decisionmaking. This Committee can help rectify this problem 

by ensuring that the development of natural resources for energy purposes proceed 

in a systematic, structured and efficient manner. The result is not to weaken or exempt projects like Cape Wind from our hallmark environmental laws, as they desire, but to return to the principles of Federal land and ocean management that 

have been developed over the decades, but are being ignored by the Corps and 

avoided in the offshore wind context. The Alliance pledges its support for establishing such a program.

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