This section of the FEDERAL REGISTER

contains regulatory documents having general

applicability and legal effect, most of which

are keyed to and codified in the Code of

Federal Regulations, which is published under

50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations is sold by

the Superintendent of Documents.

Rules and Regulations Federal Register

78197 

Vol. 85, No. 234 

Friday, December 4, 2020 

1 15 U.S.C. 717b. Section 3(a) of the NGA requires 

DOE to issue an order authorizing natural gas 

exports unless it finds that such an order ‘‘will not 

be consistent with the public interest.’’ 2 42 U.S.C. 4332(2)(C). 

3 40 CFR 1507.3. 

4 85 FR 43304 (July 16, 2020). 

5 10 CFR part 1021. 

6Section 3(c) requires DOE to authorize 

applications for the export of natural gas to nations 

with which there is a free trade agreement (FTA 

countries), requiring that all such exports be 

‘‘deemed consistent with the public interest, and 

. . . granted without modification or delay.’’ 

7 40 CFR 1508.1(g); see also Dep’t of Transp. v. 

Pub. Citizen, 541 U.S. 752 (2004); Sierra Club v. 

Fed. Energy Regulatory Comm’n, 827 F.3d 36 (D.C. 

Cir. 2016). 

8This scope of analysis is consistent with 

decisions in recent years of the United States Court 

of Appeals for the District of Columbia Circuit (D.C. 

Circuit), which recognize that DOE ‘‘maintains 

exclusive jurisdiction over the export of natural gas 

as a commodity.’’ Sierra Club v. Fed. Energy 

Regulatory Comm’n, 827 F.3d at 40. Specifically, 

the D.C. Circuit has observed that the Federal 

Energy Regulatory Commission (FERC) has an 

obligation to comply with the NGA and NEPA with 

respect to its decisions to authorize the construction 

of LNG terminals, whereas DOE has an independent 

obligation ‘‘to consider the environmental impacts 

of its export authorization decision under NEPA 

and determine whether it satisfie[s] the Natural Gas 

Act’s ‘public interest’ test.’’ Sierra Club v. U.S. 

Dep’t of Energy, 867 F.3d 189, 192 (D.C. Cir. 2017). 

9 DOE defines export activities as starting at the 

point of delivery to the export vessel, and extending 

to the territorial waters of the receiving country. 

10Energy Policy Act of 1992, Public Law 102– 

486, 106 Stat. 2776 (Oct. 24, 1992). 

11 40 CFR 1501.1(a)(5), and 40 CFR 

1508.1(q)(1)(ii); 10 CFR 1021.104(b) (defining 

‘‘Actions’’ requiring NEPA review but specifically 

excluding ‘‘purely ministerial actions with regard to 

Continued 

DEPARTMENT OF ENERGY 

10 CFR Part 1021 

[DOE–HQ–2020–0017] 

RIN 1990–AA49 

National Environmental Policy Act 

Implementing Procedures 

AGENCY: Office of the General Counsel, 

Department of Energy. 

ACTION: Final rule. 

SUMMARY: The U.S. Department of 

Energy (DOE or the Department) is 

updating its National Environmental 

Policy Act (NEPA) implementing 

procedures pertaining to authorizations 

issued under the Natural Gas Act 

(NGA). These changes will improve the 

efficiency of the DOE decision-making 

process by saving time and expense in 

the NEPA compliance process and 

eliminating unnecessary environmental 

documentation for these actions that 

DOE has determined normally do not 

have significant effects. 

DATES: This final rule is effective 

January 4, 2021. 

ADDRESSES: Documents relevant to this 

rulemaking are posted on the Federal 

eRulemaking Portal at https://

beta.regulations.gov/ (Docket: DOE–HQ– 

2020–0017). Documents posted to this 

docket include: The Notice of Proposed 

Rulemaking issued on May 1, 2020 (85 

FR 25340); DOE’s May 2020 Technical 

Support Document, which provides 

additional information; a ‘‘redline/ 

strikeout’’ (markup) file of affected 

sections of the DOE NEPA regulations 

indicating the proposed changes; the 

comments received on the proposed 

changes; this final rule; and DOE’s 

November 2020 Technical Support 

Document. Documents related to this 

rulemaking also are available on DOE’s 

NEPA website at https://energy.gov/ 

nepa. 

FOR FURTHER INFORMATION CONTACT: Mr. 

Mark J. Matarrese, Office of Fossil 

Energy, Mark.Matarrese@hq.doe.gov, 

202–586–0491; Edward Le Duc, Office 

of Assistant General Counsel for 

Environment, Edward.LeDuc@

hq.doe.gov, 202–586–4007. 

SUPPLEMENTARY INFORMATION: 

I. Background 

DOE is responsible for authorizing 

exports of domestically produced 

natural gas to foreign countries under 

section 3 of the NGA.1 NEPA requires 

agencies to consider the environmental 

impacts of proposed major Federal 

actions as part of their decision-making 

process.2 DOE must comply with 

NEPA’s requirement for an 

environmental review before reaching a 

final decision on applications to export 

natural gas to countries with which the 

United States does not have a free trade 

agreement requiring national treatment 

for trade in natural gas (non-FTA 

countries). 

The Council on Environmental 

Quality (CEQ) regulations (40 CFR parts 

1500–1508) implementing NEPA require 

agencies to develop their own NEPA 

implementing procedures, as necessary, 

to apply the CEQ regulations to their 

specific programs and decision-making 

processes.3 CEQ revised its NEPA 

regulations in July 2020.4 Through this 

rule, DOE is revising its NEPA 

regulations 5 consistent with the CEQ 

regulations that allow agencies to 

identify in their agency procedures 

categories of actions that normally do 

not have significant effects, and with the 

legal principle that potential 

environmental effects to be considered 

by an agency under NEPA do not 

include effects that the agency has no 

authority to prevent. 

In particular, DOE makes these 

revisions because (1) DOE is required by 

section 3(c) of the Natural Gas Act 6 to 

authorize liquefied natural gas (LNG) 

exports to FTA countries and lacks 

discretion with respect to such 

approvals and (2) DOE’s review of 

applications for LNG exports to nonFTA countries is limited to 

consideration of effects that are 

reasonably foreseeable and have a 

sufficiently close causal connection to 

the granting of the export 

authorization.7 As set forth below, DOE 

revises categorical exclusion (CX) B5.7 

to focus exclusively on the analysis of 

potential environmental impacts 

resulting from activities occurring at or 

after the point of export, which are 

within the scope of DOE’s export 

authorization authority under the NGA.8

Such impacts begin at the point of 

export and are limited to the marine 

transport effects.9

DOE authorization also is required for 

imports of natural gas under section 3(a) 

of the NGA. However, section 3(c) of the 

NGA was amended by section 201 of the 

Energy Policy Act of 1992 10 to require 

that applications to authorize the import 

of natural gas be ‘‘deemed consistent 

with the public interest, and . . . 

granted without modification or delay.’’ 

This requirement leaves DOE with no 

discretion in its approvals of LNG 

imports, as they are deemed to be in the 

public interest. Accordingly, DOE is 

removing the reference to authorizations 

to import natural gas from its NEPA 

regulations, consistent with the legal 

principle that an agency is not required 

to prepare a NEPA analysis when it has 

no discretion in its action.11

78198 Federal Register / Vol. 85, No. 234 / Friday, December 4, 2020 / Rules and Regulations 

which DOE has no discretion,’’ such as ‘‘ministerial 

actions to implement congressionally mandated 

funding for actions not proposed by DOE and as to 

which DOE has no discretion’’); Dep’t of Transp. v. 

Pub. Citizen, 541 U.S. at 768–770; Sierra Club v. 

Fed. Energy Regulatory Comm’n, 827 F.3d at 40; 

Citizens Against Rails-to-Trails v. Surface Transp. 

Bd., 267 F.3d 1144, 1151 (D.C. Cir. 2001). 

12There are three levels of NEPA review 

established in the (CEQ NEPA implementing 

regulations (40 CFR parts 1500–1508)—categorical 

exclusion, environmental assessment (EA), and 

environmental impact statement (EIS) each 

involving different levels of information and 

analysis. 

13See 10 CFR part 1021, subpart D. 

14 40 CFR 1508.1(g)(2). 

15 Dep’t of Transp. v. Pub. Citizen, 541 U.S. 768– 

770; Sierra Club v. Fed. Energy Regulatory Comm’n, 

827 F.3d 40 (D.C. Cir. 2016). 

16U.S. Dep’t of Energy, Technical Support 

Document, Notice of Final Rulemaking, National 

Environmental Policy Act Implementing Procedures 

(10 CFR part 1021) (Nov. 2020) [hereinafter 

Technical Support Document]. 

17Supra note 11. 

18 10 CFR part 1021, subpart D, Appendix B, 

paragraphs (1) through (5). 

19 Dep’t of Energy, National Environmental Policy 

Act Implementing Procedures, Notice of Proposed 

Rulemaking and Request for Comment, 85 FR 25340 

(May 1, 2020). 

A. What parts of DOE’s NEPA 

regulations is DOE amending? 

DOE’s NEPA regulations list classes of 

actions normally associated with each 

level of NEPA review.12 This final rule 

revises the five classes of actions 

regarding applications to import or 

export natural gas to a non-FTA 

country. These are two CXs: B5.7 

(Import or export of natural gas, with 

operational changes) and B5.8 (Import 

or export of natural gas, with new 

cogeneration powerplant); one class of 

actions normally requiring an EA: C13 

(Import or export natural gas involving 

minor new construction); and two 

classes of action normally requiring an 

EIS: D8 (Import or export of natural gas 

involving major new facilities) and D9 

(Import or export of natural gas 

involving major operational change).13

B. What revisions is DOE making? 

DOE is revising the classes of action 

in its NEPA regulations regarding 

authorizations under section 3 of the 

NGA for non-FTA countries, consistent 

with the CEQ regulations,14 and the 

legal principle enunciated in Public 

Citizen and Sierra Club 15 that potential 

environmental effects considered under 

NEPA do not include effects that the 

agency has no authority to prevent. 

DOE’s discretionary authority under 

Section 3 of the NGA is limited to the 

authorization of exports of natural gas to 

non-FTA countries. Therefore, DOE 

need not review potential 

environmental impacts associated with 

the construction or operation of natural 

gas export facilities because DOE lacks 

authority to approve the construction or 

operation of those facilities. DOE’s 

review is properly focused on potential 

environmental impacts resulting from 

the exercise of its NGA section 3 

authority. These potential impacts 

would occur at or after the point of 

export to non-FTA countries. 

Accordingly, DOE is revising the 

scope of CX B5.7 by deleting the 

reference to operation of natural gas 

facilities. The revised B5.7 includes a 

new statement that the scope includes 

any ‘‘associated transportation of 

natural gas by marine vessel,’’ which 

would be the only source of potential 

environmental impacts resulting from 

DOE’s decision regarding authorizations 

under section 3 of the NGA. Based on 

prior NEPA reviews and technical 

reports,16 DOE has determined that 

transport of natural gas by marine vessel 

normally does not pose the potential for 

significant environmental impacts. 

DOE also is removing the reference to 

import authorizations from B5.7 because 

section 3(c) of the NGA directs that 

authorization requests to import natural 

gas, as described in NGA section 3(b), 

‘‘shall be granted without modification 

or delay.’’ DOE is not required to 

prepare NEPA analysis when it has no 

discretion in its action.17

Finally, DOE is removing and 

reserving CX B5.8 and classes of action 

C13, D8, and D9 because these actions 

are outside the scope of DOE’s authority 

or are covered by the revised CX B5.7. 

C. How does DOE make a CX 

determination? 

The revised CX B5.7 is subject to the 

same conditions as other CXs listed in 

appendix B to subpart D of DOE’s NEPA 

regulations. Before a proposed action 

such as an export authorization may be 

categorically excluded, DOE must 

review the proposed action in 

accordance with 10 CFR 1021.410 and 

determine that application of a CX is 

appropriate. 

In addition, to fit within a class of 

actions in appendix B (including B5.7), 

a proposed action must satisfy certain 

conditions known as ‘‘integral 

elements.’’ 18 These conditions ensure 

that a proposed action would not have 

the potential to cause significant 

environmental impacts—for example, 

due to a threatened violation of 

applicable environmental, safety, and 

health requirements. 

II. Comments Received and DOE’s 

Responses 

DOE invited interested persons to 

submit comments on the Notice of 

Proposed Rulemaking and supporting 

information during a public comment 

period that ended on June 1, 2020.19

DOE received 16 comment letters from 

a number of parties, including 

environmental organizations, industry 

groups, and individuals. The Notice of 

Proposed Rulemaking and comments 

DOE received are available on the 

Federal eRulemaking Portal as described 

in the ADDRESSES section of this final 

rule. 

DOE has evaluated the comments it 

received. In this section, DOE discusses 

the relevant, substantive comments and 

provides its responses to those 

comments. Some commenters raised 

issues that are outside the scope of the 

Notice of Proposed Rulemaking, because 

they do not speak to DOE’s NEPA 

obligations or to the subject of the 

proposed rule. These issues include 

fossil energy extraction and use, 

construction of LNG pipelines and 

terminals, expanding use of renewable 

energy generally, moving to a carbonneutral energy mix, and whether DOE’s 

public interest analysis under the NGA 

has an environmental component. 

A. General Comments 

Some commenters expressed support 

for DOE’s proposed changes. For 

example, some commenters remarked 

that the proposed changes will reduce 

redundancy, delay, and regulatory 

uncertainty. DOE acknowledges these 

comments. Some commenters opposed 

the proposed rulemaking, stating, for 

example, that DOE had provided no 

evidence the proposed changes would 

improve efficiency. Based on its 

experience reviewing and considering 

the potential environmental effects of 

many requests for export authorization, 

DOE believes that the proposed changes 

will improve the efficiency of DOE’s 

decision-making process by focusing its 

NEPA review on those activities that are 

within DOE’s authority under the NGA. 

Some commenters requested that DOE 

extend the public comment period on 

the Notice of Proposed Rulemaking. To 

support their request, these commenters 

referred to impacts of the proposed 

changes on agency environmental 

review obligations and to circumstances 

created by the COVID–19 national 

emergency. DOE believes that the thirtyday comment period provided for this 

proposed rulemaking provided an 

adequate opportunity for public 

comment for these limited revisions to 

its implementing procedures. DOE 

recognizes the substantial disruption 

and hardship brought about by the 

COVID–19 pandemic. However, the 

proposed rule was widely available in a 

variety of accessible formats, and 

Federal Register / Vol. 85, No. 234 / Friday, December 4, 2020 / Rules and Regulations 78199 

20 40 CFR 1501.4(b). 

21 In most cases, facility approval falls under 

FERC jurisdiction. In some cases involving offshore 

export facilities, the United States Maritime 

Administration (MARAD), rather than FERC, has 

statutory authority to approve facility construction 

and operation. Less commonly, where MARAD 

lacks jurisdiction, the Bureau of Ocean Energy 

Management (BOEM) would issue approval. DOE’s 

practice was to adopt the NEPA record established 

by the authorizing agency for the facility. 

22See Kuhali v. Reno, 266 F.3d 93, 104 (2d Cir. 

2001) (citing legal definitions of ‘‘export’’ including 

those in Black’s Law Dictionary 600 (7th ed.1999) 

(‘‘to send or carry abroad’’), ‘‘as well as with the 

common usage of the term, e.g., Webster’s New 

Collegiate Dictionary 400 (1981) (‘to carry or send 

(as a commodity) to some other place (as another 

country).’ ’’). This suggests that the ‘‘export’’ is 

limited to the action of transporting natural gas 

products from the U.S. to the receiving country, and 

that export activities therefore do not begin before 

the act of transporting the product overseas is 

initiated. 

23Heartwood, Inc. v. U.S. Forest Service, 73 F. 

Supp. 2d 962, 972–73 (S.D. Ill. 1999), aff’d, 230 F. 

3d 947, 954–55 (7th Cir. 2000) (upholding the 

determination that establishing agency NEPA 

procedures does not require an EA or an EIS). 

24 40 CFR 1507.3(b). 

25Pub. Citizen, 541 U.S. 767–768. 

26Pub. Citizen, 541 U.S. 767 (‘‘Respondents must 

rest, then, on a particularly unyielding variation of 

‘but for’ causation, where an agency’s action is 

considered a cause of an environmental effect even 

when the agency has no authority to prevent the 

effect. However, a ‘‘but for’’ causal relationship is 

insufficient to make an agency responsible for a 

particular effect under NEPA and the relevant 

regulations.’’); see also 40 CFR 1508.1(g). 

27U.S. Dep’t of Energy, Addendum to 

Environmental Review Documents Concerning 

Exports of Natural Gas from the United States, at 

1 (Aug. 2014) (citing Freeport LNG Expansion, L.P. 

Continued 

comment submission was available 

through the Federal eRulemaking Portal 

and postal mail. It is important 

throughout this pandemic that DOE 

continue its mission, particularly in 

areas that contribute to strengthening 

the United States’ economy. 

B. Comments Regarding the NEPA 

Process and Standards for Developing a 

CX 

I. Environmental Documentation 

Supporting Decisions Made Pursuant to 

DOE’s Statutory Authority 

Some commenters objected to use of 

a CX as proposed, stating that NEPA 

reviews are not ‘‘unnecessary 

environmental documentation.’’ A CX 

does not eliminate NEPA review. Rather 

it is a form of NEPA review that allows 

agencies to focus their resources on 

information pertinent to the agency’s 

decision-making authority and related 

to potentially significant environmental 

impacts. In implementing the revised 

CX, DOE will consider whether an 

extraordinary circumstance is present 

such that an EA or EIS will be 

required.20 DOE will also document its 

determination that application of the CX 

is appropriate. DOE’s use of the phrase 

‘‘unnecessary environmental 

documentation’’ is a reference to DOE’s 

prior practice of considering the 

potential environmental effects from 

activities that are beyond its decisionmaking authority, such as LNG terminal 

construction and operation. In virtually 

all of its recent LNG export proceedings, 

DOE has referenced in its export orders 

the environmental documents prepared 

by the Federal Energy Regulatory 

Commission (FERC).21 FERC, not DOE, 

reviews the potential environmental 

impacts of the construction and 

operation of the LNG terminals. Under 

the revised CX, DOE’s NEPA review is 

tailored to its statutory authority and 

will not unnecessarily duplicate the 

documents that FERC or other agencies 

prepare under their statutory 

authorities. 

II. Scope of ‘‘Export Activities’’ 

One commenter suggested that DOE 

should expand the definition of 

‘‘export’’ to include operations required 

for the export process. DOE 

acknowledges the comment and notes 

that the statutory term ‘‘export’’ is not 

defined in the NGA. However, in 

adjudications under NGA section 3(a), 

DOE has construed an ‘‘export’’ of LNG 

from the United States as occurring 

‘‘when the LNG is delivered to the 

flange of the LNG export vessel.’’ 22

Therefore, DOE believes it is 

appropriate for its NEPA review of 

natural gas export applications to 

consider the potential environmental 

impacts starting at the point of delivery 

to the export vessel, and extending to 

the territorial waters of the receiving 

country. This is referred to in the 

revised CX as export of natural gas 

under section 3 of the Natural Gas Act 

and any associated transportation of 

natural gas by marine vessel. 

III. Criteria for Establishing a CX 

Some commenters expressed concern 

that DOE did not meet the standard for 

establishing a CX and should have 

prepared an EA or an EIS for this 

rulemaking. These commenters stated 

that DOE (i) did not adequately consider 

the potential significance of 

environmental impacts resulting from 

this rulemaking, (ii) must analyze 

cumulative impacts of this rulemaking, 

and (iii) segmented consideration of 

natural gas exports from other 

connected actions in promulgating this 

rule. 

DOE has met its obligations under 

NEPA. As noted in the Review Under 

National Environmental Policy Act 

sections of the Notice of Proposed 

Rulemaking and this final rule, the CEQ 

regulations do not direct agencies to 

prepare an EA or EIS before establishing 

agency procedures that supplement the 

CEQ regulations to implement NEPA.23

CEQ regulations provide that an agency, 

when establishing a CX, must ‘‘consult’’ 

with CEQ for input regarding 

conformity with CEQ regulations and 

NEPA before publishing new NEPA 

procedures in the Federal Register for 

comment.24 DOE has complied with this 

requirement. 

Nevertheless, to support its decision, 

DOE did engage in an analysis to 

properly assess the potential 

significance of actions included in the 

revised CX B5.7. This analysis included 

a detailed review of technical 

documents regarding potential effects 

associated with marine transport of 

LNG. These documents are included in 

the Technical Support Document and 

support DOE’s conclusion that potential 

environmental effects associated with 

marine transport, the only reasonably 

foreseeable environmental impacts 

associated with DOE natural gas export 

authorizations, are minimal. 

Commenters asserted that DOE does 

not meet the standard for establishing a 

CX because it impermissibly segments 

natural gas exports from other 

connected actions, arguing that FERC’s 

approval of export facilities is a 

‘‘connected action’’ to DOE’s export 

approval that must be considered as part 

of DOE’s NEPA review. The CX adopted 

in this final rule follows the Supreme 

Court’s holding in Public Citizen 25 and 

the current CEQ NEPA regulation at 40 

CFR 1501.9(e)(1) regarding the 

circumstances in which ‘‘connected 

actions’’ must be analyzed. According to 

Public Citizen and the current CEQ 

NEPA regulations, a ‘‘but for’’ causal 

relationship is insufficient to make an 

agency responsible for a particular effect 

under NEPA.26 Accordingly, DOE’s 

export authorizations and the 

construction and operation of export 

facilities do not have a sufficient causal 

connection to be considered connected 

actions. FERC has exclusive statutory 

authority to approve construction and 

operation of natural gas export facilities. 

DOE has no authority to approve 

construction or operation of such 

facilities, and thus there is no DOE 

decision to be informed by a NEPA 

analysis. The only decision for which 

DOE has authority is with respect to the 

export of the commodity itself. DOE’s 

and FERC’s approval actions are not 

interdependent.27 Therefore, DOE need 

78200 Federal Register / Vol. 85, No. 234 / Friday, December 4, 2020 / Rules and Regulations 

and FLNG Liquefaction, LLC, DOE/FE Order No. 

3282, Order Conditionally Granting Long-Term 

Multi-Contract Authorization to Export Liquefied 

Natural Gas by Vessel From the Freeport LNG 

Terminal on Quintana Island, Texas, to Non-Free 

Trade Agreement Nations (May 17, 2013)) 

(‘‘receiving a non-FTA authorization from DOE does 

not guarantee that a particular facility would be 

financed and built; nor does it guarantee that, even 

if built, market conditions would continue to favor 

export once the facility is operational.’’). 

28Sierra Club v Bosworth, 510 F.3d 1016 (9th Cir. 

2007). 

29U.S. Forest Service, FSH 1909.15, at 31.3 (May 

28, 2014). 

30 40 CFR 1501.9. 

31See Texas LNG Brownsville LLC, DOE/FE 

Order No. 4489, FE Docket No. 15–62–LNG, 

Opinion and Order Granting Long-Term 

Authorization to Export Liquefied Natural Gas to 

Non-Free Trade Agreement Nations, at 40–42 (Feb. 

10, 2020) (reviewing the content of the life cycle 

analyses (LCAs) and Addendum; noting that the 

information in the LCA is too general to play a 

direct role in the NGA public interest analysis, and 

explaining that the Addendum supports the public 

interest analysis, but that environmental concerns 

should be addressed directly through 

environmental regulation, and that ‘‘section 3(a) of 

the NGA is too blunt an instrument to address these 

environmental concerns efficiently.’’). 

32Sierra Club v. U.S. Dep’t of Energy, 867 F.3d 

198 (‘‘The Department offered a reasoned 

explanation as to why it believed the indirect 

effects pertaining to increased gas production were 

not reasonably foreseeable.’’). 

33 40 CFR 1508.1(g). 

34Quechan Indian Tribe of the Fort Yuma Indian 

Reservation v. U.S. Dept. of the Interior, 547 F. 

Supp. 2d 1033, 1042 (D. Ariz. 2008) (citing Public 

Citizen, 541 U.S. 767). 

not consider effects associated with the 

construction and operation of natural 

gas export facilities under NEPA. 

To the extent that commenters rely on 

Sierra Club v. Bosworth 28 to support the 

concerns raised above, this reliance is 

misplaced. As described in the 

paragraphs that follow, the facts of 

Bosworth are not analogous to this 

rulemaking. 

With regard to scoping, DOE notes 

that Bosworth pertains to an action 

taken by the U.S. Forest Service. 

According to the Forest Service NEPA 

Handbook, scoping was required for all 

Forest Service proposed actions, 

including those that would be 

categorically excluded.29 DOE has no 

similar requirement in its regulations, 

and the CEQ regulations require scoping 

only after a decision has been made to 

prepare an EIS.30 Since an EIS is not 

required to establish NEPA procedures 

under CEQ or DOE regulations or 

applicable case law, scoping was not a 

prerequisite for the promulgation of this 

rule. 

Some commenters cited Bosworth 

when raising their concern that DOE 

had failed to adequately review 

potential cumulative impacts associated 

with promulgation of the CX, or that 

DOE has failed to draft the CX with 

sufficient specificity to distinguish 

between actions having significant 

impacts and those that do not. In 

contrast to the CX at issue in Bosworth, 

DOE’s CX has been drafted with the 

requisite specificity, given the nature of 

action to which it will apply. 

Furthermore, DOE has determined that 

the transport of natural gas by marine 

vessels adhering to applicable maritime 

safety regulations and established 

shipping methods and safety standards 

normally does not pose the potential for 

significant environmental impacts. 

Impacts beyond marine transport are 

beyond the scope of DOE’s NEPA 

review. 

In Bosworth, the court agreed with 

previous cases finding that the 

promulgation of agency NEPA 

procedures, including the establishment 

of new CXs, did not itself require 

preparation of an EA or EIS, but that 

agencies need only comply with CEQ 

regulations setting forth procedural 

requirements, including consultation 

with CEQ, and Federal Register 

publication for public comment. The 

court, however, found that the record 

relied on by the U.S. Forest Service to 

develop and justify a CX was deficient. 

Unlike the circumstances in Bosworth, 

DOE’s proposed CX would not include 

exports with materially different 

environmental impacts. Although DOE’s 

CX would apply to various types of 

natural gas exports, the degree of 

potential environmental effects are not 

expected to vary significantly based on 

the type or volume of natural gas to be 

exported, to the extent they comport 

with established applicable maritime 

safety regulations and shipping methods 

and safety standards. This is due, in 

part, to the safety controls imposed on 

vessels permitted to carry natural gas 

products. 

Other commenters argued that DOE 

does not meet the standard for 

establishing a CX because it fails to take 

into account the potential 

environmental impacts of natural gas 

export beyond marine transit, noting 

that DOE has previously acknowledged 

other potential impacts associated with 

its export authorizations, including 

inducement of upstream natural gas 

production. However, DOE has not 

previously included potential upstream 

and downstream impacts as part of its 

NEPA analyses for natural gas export 

approvals.31 Induced upstream 

production impacts are not reasonably 

foreseeable for NEPA purposes,32 and 

are therefore not ‘‘effects’’ subject to 

analysis under NEPA.33 Furthermore, 

downstream emissions at the point of 

consumption are too attenuated to be 

reasonably foreseeable and do not have 

a reasonably close causal relationship to 

the granting of an export authorization. 

The Notice of Proposed Rulemaking and 

final rule are consistent with these 

principles. 

One commenter noted that while DOE 

has relied on the life cycle analyses 

(LCAs) to support its public interest 

determination, the subject matter falls 

outside DOE’s NEPA review obligations 

because the regasification and ultimate 

burning of LNG in foreign countries are 

beyond the scope of DOE requirements 

under NEPA. DOE agrees with this 

comment. 

IV. Compliance With Applicable NEPA 

Requirements 

Some commenters raised concerns 

regarding the application of the 

proposed CX, arguing that the CX is 

invalid because it improperly excludes 

the consideration of end use impacts, 

including those related to climate 

change. Conversely, one commenter 

requested that DOE explain in the final 

rulemaking that effects should not be 

considered significant if they are remote 

in time, geographically remote, or the 

result of a lengthy causal chain. The 

commenter indicated that DOE should 

also state that for any required analysis 

of effects, ‘‘a ‘but for’ causal relationship 

is insufficient to make an agency 

responsible for a particular effect under 

NEPA.’’ 34 In response, DOE reiterates 

that the relationship between DOE’s 

authorization decision and potential 

end use impacts is too attenuated to 

define end use impacts as reasonably 

foreseeable effects requiring NEPA 

review. 

Additionally, commenters alleged that 

DOE’s commissioning of Energy 

Information Administration (EIA) 

analyses of export impacts on domestic 

energy markets, including the 2018 

study ‘‘Macroeconomic Outcomes of 

Market Determined Levels of U.S. LNG 

Exports,’’ show that DOE considers the 

upstream impacts of its export 

decisions. The EIA studies informed 

DOE’s public interest analysis under the 

NGA, but they do not analyze potential 

environmental impacts and have not 

been included as part of DOE’s NEPA 

analyses supporting the natural gas 

export decision-making process. 

Commenters stated that DOE could 

rely on the locations of interstate 

pipelines to develop a reasonable 

estimate of where increased upstream 

production of natural gas may occur as 

a result of an authorization of natural 

gas exports. DOE disagrees with this 

comment. The question of whether 

upstream production impacts should be 

Federal Register / Vol. 85, No. 234 / Friday, December 4, 2020 / Rules and Regulations 78201 

35Sierra Club v. U.S. Dep’t of Energy, 867 F.3d 

198. 

36 Id. at 199 (internal citations omitted). 

37 40 CFR 1508.1(g). 

38See Technical Support Document. 

39 40 CFR 1501.4. 

40Sierra Club v. Federal Energy Regulatory 

Comm’n, 867 F.3d 1357, 1372 (D.C. Cir. 2017) 

(stating that rule was the touchstone of Public 

Citizen). 

41 40 CFR 1508.1(d). 

42U.S. Dep’t of Energy, Life Cycle Greenhouse 

Gas Perspective on Exporting Liquefied Natural Gas 

From the United States, 79 FR 32260 (June 4, 2014) 

(LCA GHG Report). 

43U.S. Dep’t of Energy, Life Cycle Greenhouse 

Gas Perspective on Exporting Liquefied Natural Gas 

From the United States; Notice of Availability of 

Report Entitled Life Cycle Greenhouse Gas 

Perspective on Exporting Liquefied Natural Gas 

From the United States: 2019 Update and Request 

for Comments, 84 FR 49278 (Sept. 19, 2019) (LCA 

GHG Update). 

included in the scope of DOE’s NEPA 

analyses has been addressed by the D.C. 

Circuit. The D.C. Circuit has held that 

DOE has provided ‘‘a reasoned 

explanation as to why it believe(s) the 

indirect effects pertaining to increased 

gas production were not reasonably 

foreseeable’’ and therefore not subject to 

NEPA review.35 The court found that 

‘‘(b)ecause the Department could not 

estimate the locale of production, it was 

in no position to conduct an 

environmental analysis of 

corresponding local-level impacts, 

which inevitably would be more 

misleading than informative.’’ 36 The 

current CEQ NEPA regulations confirm 

that effects must be ‘‘reasonably 

foreseeable and have a reasonably close 

causal relationship to the proposed 

action’’ to be considered under NEPA, 

and note that ‘‘effects should generally 

not be considered if they are remote in 

time, geographically remote, or the 

product of a lengthy causal chain.’’ 37

Under this standard, consideration of 

upstream impacts is not required. 

Commenters suggested that DOE 

prepare a programmatic environmental 

impact statement to streamline NEPA 

review of natural gas export 

authorizations. DOE has identified no 

information to indicate that natural gas 

export authorizations pose the potential 

for significant environmental impacts.38

Therefore, a CX is the appropriate level 

of NEPA review, and preparation of a 

programmatic environmental impact 

statement is not required, nor is it 

necessary.39

Other commenters suggested that DOE 

should continue to evaluate NGA 

Section 3 export authorizations on a 

case-by-case basis to determine whether 

an EA or EIS is appropriate. As 

described in the section of this final rule 

titled ‘‘How does DOE make a CX 

determination?,’’ the proposed CX 

would be applied on a case-by-case 

basis. For any request for export 

authorization, DOE would apply the CX 

only after determining that the subject 

authorization complies with 10 CFR 

1021.410, including that it presents no 

extraordinary circumstances warranting 

preparation of an EA or EIS, and with 

the integral elements listed in appendix 

B of DOE’s NEPA regulations. 

Some commenters argued that DOE 

should be assessing the potential 

environmental impacts stemming from 

the construction or operation of natural 

gas export facilities. As noted in the 

‘‘Background’’ section of this document, 

under Section 3 of the Natural Gas Act, 

DOE’s authority is limited to reviewing 

applications for natural gas exports; 

FERC (or, in the case of a facility falling 

outside FERC jurisdiction, MARAD or 

BOEM) reviews applications to 

construct and operate natural gas import 

and export facilities. Because DOE lacks 

the authority to prevent effects 

stemming from the construction and 

operation of such a facility, it has 

appropriately focused its environmental 

review on proposals over which it has 

approval authority, as required by 

NEPA. 

Finally, some commenters noted that 

CEQ was, at the time of the comment 

period on the Notice of Proposed 

Rulemaking, in the process of revising 

its NEPA regulations. These 

commenters stated that DOE must 

comply with the CEQ regulations in 

effect, rather than proposed revisions. 

DOE prepared the Notice of Proposed 

Rulemaking consistent with the CEQ 

regulations in effect at the time the 

Notice of Proposed Rulemaking was 

published. DOE has prepared this final 

rule in light of the current CEQ 

regulations, which became effective on 

September 14, 2020, and DOE has 

determined, in consultation with CEQ, 

that the rule is consistent with those 

regulations. 

C. Comments Regarding DOE’s Reading 

of Public Citizen 

Certain commenters challenged DOE’s 

reading of Public Citizen as overly 

broad, arguing that DOE is incorrect in 

its conclusion that the case permits DOE 

to focus exclusively on the marine 

transport related effects of its export 

authorizations. In DOE’s view, Public 

Citizen held that an agency has no 

obligation to ‘‘gather or consider 

environmental information if it has no 

statutory authority to act on that 

information.’’ 40 This final rule is fully 

consistent with that holding. 

D. Comments Regarding Indirect and 

Cumulative Impacts and Related DOE 

Authority 

Some commenters suggested that by 

establishing a CX for exports of natural 

gas, DOE is evading the obligation to 

perform NEPA review. As identified in 

the CEQ and DOE NEPA regulations, a 

CX is a form of NEPA review, and DOE 

has complied with the requirements of 

NEPA by determining that this class of 

actions normally does not have a 

significant effect on the human 

environment.41 Application of the 

revised CX B5.7 will occur on a case-bycase basis as described in the section of 

this final rule titled ‘‘How does DOE 

make a CX determination?’’ As 

explained previously, DOE is tailoring 

its environmental review consistent 

with the court’s holding in Public 

Citizen. 

In further delineating agencies’ NEPA 

review obligations, the D.C. Circuit in 

Freeport II agreed with DOE’s rationale 

that effects pertaining to increased gas 

production were not reasonably 

foreseeable. Under this standard, DOE’s 

analysis is properly limited to impacts 

stemming directly from decisions made 

pursuant to its statutory authority. The 

D.C. Circuit has held that local 

idiosyncrasies coupled with the 

limitations of estimating geology at the 

local level, and the uncertainty of 

predicting local regulation, land use 

patterns, and the development of 

supporting infrastructure are all local 

environmental issues presented by 

unconventional gas production. 

Accordingly, DOE’s review of potential 

environmental impacts begins at the 

point of export, and is limited to the 

marine transport effects covered by the 

revised CX. The CX, which provides 

DOE with an option for full NEPA 

compliance, does not evade NEPA 

review. 

E. Comments Regarding DOE’s LCA 

As discussed in the Notice of 

Proposed Rulemaking, this rulemaking 

is consistent with—but not dependent 

upon—two LCAs that DOE 

commissioned to calculate the life cycle 

greenhouse gas (GHG) emissions for 

LNG exported from the United States. 

DOE commissioned both the original 

LCA, published in 2014,42 and an 

updated LCA, published in 2019,43 to 

evaluate environmental aspects of LNG 

export applications under NGA section 

3(a). Both LCAs concluded that the use 

of U.S. LNG exports for power 

production in European and Asian 

markets will not increase global GHG 

emissions from a life cycle perspective, 

when compared to regional coal 

extraction and consumption for power 

78202 Federal Register / Vol. 85, No. 234 / Friday, December 4, 2020 / Rules and Regulations 

44See, e.g., U.S. Dep’t of Energy, Life Cycle 

Greenhouse Gas Perspective on Exporting Liquefied 

Natural Gas From the United States: 2019 Update— 

Response to Comments, 85 FR 72 78, 85 (Jan. 2, 

2020). 

45U.S. Dep’t of Energy, Life Cycle Greenhouse 

Gas Perspective on Exporting Liquefied Natural Gas 

From the United States: 2019 Update—Response to 

Comments, 85 FR 72 (Jan. 2, 2020). 

46Bureau of Transp. Stat., U.S. Dep’t of Transp., 

Freight Facts and Figures 2017, https://

rosap.ntl.bts.gov/view/dot/34923. 

47Office of Fossil Energy, U.S. Dep’t of Energy, 

LNG Monthly 2020, https://www.energy.gov/fe/ 

downloads/lng-monthly-2020. 

48U.S. Gov’t Accountability Office, Maritime 

Security: Public Safety Consequences of a Terrorist 

Attack on a Tanker Carrying Liquefied Natural Gas 

Need Clarification, GAO-07–316 (Feb. 2007), 

https://www.gao.gov/new.items/d07316.pdf. 

49U.S. Dep’t of Energy, Liquefied Natural Gas 

Safety Research: Report to Congress, (May 2012), 

https://www.energy.gov/fe/downloads/lng-safetyresearch-report-congress. 

production.44 These reports are not part 

of DOE’s NEPA review process, 

inasmuch as the regasification and 

ultimate combustion of regasified U.S. 

LNG in foreign countries are beyond the 

scope of appropriate NEPA review in 

this context. 

Some commenters on the Notice of 

Proposed Rulemaking stated that the 

LCAs are deficient because they 

underestimate methane emissions 

associated with natural gas production 

and do not account for the rise of 

renewable energy in overseas markets. 

As noted, the LCA is not a NEPA 

document. Comments regarding its 

adequacy do not address DOE’s NEPA 

analysis and related regulations, or the 

proposed changes in the Notice of 

Proposed Rulemaking. 

Furthermore, comments stating that 

the LCAs are deficient parallel 

comments that DOE received on the 

2019 LCA GHG update regarding 

methane emission estimates. DOE 

responded to those comments before 

finalizing the 2019 LCA GHG update.45

Among other relevant points, DOE 

explained in its earlier response the 

basis for use of 0.7% as the average 

methane leakage rate in the LCA GHG 

update, how DOE’s analysis considered 

the natural gas supply chain, differences 

in top-down and bottom-up 

methodologies, and how studies cited 

by commenters relate to DOE’s analysis. 

DOE directs readers to that document 

for additional background information 

and discussion. Commenters on the 

Notice of Proposed Rulemaking have 

not raised information or arguments that 

were not raised and responded to in the 

2019 GHG LCA update. 

With regard to the second point—the 

rise of renewable energy in overseas 

markets—DOE also received and 

responded to similar comments on the 

2019 LCA GHG update. DOE explained 

its use of coal-fired power as a 

comparative scenario to natural gas. 

DOE also explained limitations on 

expanding the analysis to include a 

broader array of fuel types and on 

modeling the effect that U.S. LNG 

exports would have on net global GHG 

emissions. Commenters also suggested 

that U.S. LNG exports would compete 

with renewable energy sources, while 

other commenters noted that natural 

gas-fueled power plants, because of 

their ability to power up quickly, may 

be used as a backup to renewable energy 

sources. DOE acknowledges these 

comments, but notes that these 

comments are beyond the reasonable 

scope of analysis for this rulemaking. 

F. Comments Regarding DOE’s 

Technical Support Document 

Commenters stated that the Technical 

Support Document only considered one 

pathway for potential environmental 

impacts (leaks during natural gas 

transportation) and did not address 

potential impacts to wildlife during 

marine transport from noise and ship 

strikes, air pollutants and greenhouse 

gas emissions from the marine vessels, 

and impacts from invasive species that 

travel in ballast water. The Technical 

Support Document is focused on the 

potential impacts associated with 

transporting the LNG cargo. The 

Technical Support Document includes 

consideration of accidents (including 

spills and fires), safety and security 

during transport, and some 50 years of 

experience transporting LNG on marine 

vessels. With regard to comments 

related to potential environmental 

impacts of shipping generally, DOE’s 

approval of export authorizations for 

natural gas has the potential to 

contribute only a very small amount to 

total shipping. More than 82,000 

oceangoing vessels called at U.S. ports 

in 2015.46 LNG shipments associated 

with DOE export authorizations 

numbered 209 in 2017, 330 in 2018, and 

563 in 2019.47 These LNG shipments 

comprise less than one percent of vessel 

calls from U.S. ports annually. Even 

with increased LNG exports, the relative 

proportion of LNG shipments to total 

shipping is not expected to change 

substantially. Thus, marine transport 

from DOE’s actions does not have the 

potential to markedly affect the global 

environmental impacts associated with 

the commercial shipping industry. 

Some commenters further stated that 

the Technical Support Document 

downplays significant spill and 

terrorism-related safety concerns. DOE’s 

Technical Support Document includes a 

discussion of these concerns, as the 

commenters noted. The studies 

referenced in the Technical Support 

Document analyzed a number of 

scenarios, most involving fires, and 

provided information and 

recommendations to help manage and 

reduce hazards. Commenters pointed to 

a 2007 report 48 by the U.S. Government 

Accountability Office that identified 

additional areas for research into LNG 

spills and fires. That report resulted in 

recommendations that DOE accepted 

and incorporated into a study 

conducted by Sandia National 

Laboratories.49 DOE’s technical studies 

and related research by others to 

examine the hazards of potential fires 

and the consequences of malevolent acts 

is part of the process used by regulatory 

agencies and industry to understand 

and mitigate risks. 

Commenters suggested that DOE 

cannot rely on certifications and 

requirements from other Federal 

agencies (e.g., FERC, the Department of 

Transportation, and the Department of 

Homeland Security) and that doing so in 

the Technical Support Document 

amounted to a refusal to look at the 

potential environmental impacts 

associated with transportation of LNG 

by marine vessel. DOE notes that it is 

common practice to consider regulatory 

requirements (in this case, requirements 

intended to minimize any 

environmental impacts of marine 

transport of LNG), as well as analyses 

and determinations by other Federal 

agencies and external parties, in 

determining the potential impacts of the 

activity that is the focus of an agency’s 

NEPA review. Also, DOE did not rely in 

the Technical Support Document only 

on the safety aspects of existing 

regulations. Rather, the effectiveness of 

those regulations and industry practices 

over decades of LNG transport provide 

strong evidence that there is normally 

no potential for significant 

environmental impacts due to marine 

transport of LNG. 

G. Comments Regarding Review by the 

Federal Energy Regulatory Commission 

Some commenters discussed the 

nature of DOE’s interaction with FERC 

when approving natural gas exports. 

One commenter stated that DOE must 

actively participate in FERC’s 

environmental review process. DOE 

intends to continue to participate as a 

cooperating agency in FERC’s 

environmental review of natural gas 

export facilities. 

Several commenters noted that DOE’s 

proposed revision reflects an 

appropriate approach to balancing FERC 

Federal Register / Vol. 85, No. 234 / Friday, December 4, 2020 / Rules and Regulations 78203 

and DOE’s respective responsibilities. 

They explain that the proposed 

revisions do not impede FERC’s ability 

to carry out its responsibilities and do 

not reflect an intention to hinder 

environmental review of facilities 

subject to section 3 of the NGA. One 

commenter noted that DOE’s 

jurisdiction rests solely with the export 

of natural gas, and that DOE lacks the 

authority to approve the construction or 

operation of the natural gas facility 

itself, which rests with FERC. The 

commenter stated that because DOE 

lacks authority over construction and 

operation, it need not review potential 

environmental impacts associated with 

the facilities themselves. Instead, the 

commenter maintained that under 

Public Citizen, DOE should limit its 

review to the potential environmental 

impacts within DOE’s authority, namely 

the impacts that occur at or after the 

point of export. DOE acknowledges 

these comments and has revised its 

NEPA regulations consistent with the 

view expressed in the comments. 

Commenters suggested that there will 

be a regulatory gap when an export 

facility does not fall within FERC 

jurisdiction. DOE lacks the statutory 

authority to authorize construction and 

operation of export facilities, regardless 

of whether these facilities are deemed 

jurisdictional by FERC. Therefore, DOE 

need not review environmental impacts 

associated with those authorizations. 

For a proposed export facility outside 

FERC jurisdiction, another Federal 

agency, such as MARAD or BOEM, 

would typically be responsible for 

completing the NEPA review. 

III. Procedural Requirements 

A. Review Under Executive Order 12866 

This final rule has been determined 

not to be a significant regulatory action 

under E.O. 12866, ‘‘Regulatory Planning 

and Review,’’ 58 FR 51735 (Oct. 4, 

1993). Accordingly, this action was not 

subject to review under that Executive 

Order by the Office of Information and 

Regulatory Affairs (OIRA) of the Office 

of Management and Budget (OMB). 

B. Review Under National 

Environmental Policy Act 

The Department’s NEPA procedures 

assist the Department in fulfilling its 

responsibilities under NEPA and the 

CEQ regulations, but are not themselves 

final determinations of the level of 

environmental review required for 

particular proposed actions. The CEQ 

regulations do not direct agencies to 

prepare an EA or EIS before establishing 

agency procedures that supplement the 

CEQ regulations to implement NEPA (40 

CFR 1507.3). See Heartwood, Inc. v. 

U.S. Forest Service, 73 F. Supp. 2d 962, 

972–73 (S.D. III. 1999), aff’d, 230 F.3d 

947, 954–55 (7th Cir. 2000). In 

establishing this CX, DOE is following 

the requirements of CEQ’s procedural 

regulations, which include publishing 

the Notice of Proposed Rulemaking in 

the Federal Register for public review 

and comment, considering public 

comments, and consulting with CEQ to 

obtain CEQ’s written determination of 

conformity with NEPA and the CEQ 

regulations. (See 40 CFR 1507.3(b)(2)). 

Furthermore, DOE notes that this 

rulemaking is also categorically 

excluded under DOE’s NEPA 

regulations (A6, Procedural 

rulemakings). In any case, the 

Department does not anticipate any 

significant environmental impacts from 

this final rule, and there are no 

extraordinary circumstances present. 

C. Review Under Regulatory Flexibility 

Act 

The Regulatory Flexibility Act (5 

U.S.C. 601 et seq.) requires preparation 

of a final regulatory flexibility analysis 

for any rule that by law must be 

proposed for public comment, unless 

the agency certifies that the rule, if 

promulgated, will not have a significant 

economic impact on a substantial 

number of small entities. As required by 

E.O. 13272, ‘‘Proper Consideration of 

Small Entities in Agency Rulemaking,’’ 

67 FR 53461 (Aug. 16, 2002), DOE 

published procedures and policies on 

February 19, 2003, to ensure that the 

potential impacts of its rules on small 

entities are properly considered during 

the rulemaking process (68 FR 7990). 

DOE has made its procedures and 

policies available on the Office of the 

General Counsel’s website: https://

energy.gov/gc. 

DOE has reviewed this final rule 

under the provisions of the Regulatory 

Flexibility Act and the procedures and 

policies published on February 19, 

2003. This final rule does not directly 

regulate small entities. The revisions to 

10 CFR part 1021 revise the scope of CX 

B5.7 by removing reference to operation 

of natural gas facilities and adding 

‘‘transportation of natural gas by marine 

vessel.’’ The revisions also focus on the 

export of natural gas because imports 

are deemed by law to be in the public 

interest. The revisions are intended to 

appropriately focus DOE’s NEPA 

analysis for natural gas export 

applications, and do not impose any 

new requirements on small entities. 

DOE anticipates that the rule could 

reduce the burden on applicants for 

conducting environmental reviews. 

On the basis of the foregoing, DOE 

certified that the proposed rule, if 

adopted, would not have a significant 

economic impact on a substantial 

number of small entities. DOE’s 

certification and supporting statement 

of factual basis was provided to the 

Chief Counsel for Advocacy of the Small 

Business Administration pursuant to 5 

U.S.C. 605(b). DOE received no 

comments on its certification or any 

potential economic impact of the 

proposed rule, and did not make 

changes in this final rule to the rule as 

proposed. 

D. Review Under Paperwork Reduction 

Act 

This rulemaking will impose no new 

information or record-keeping 

requirements. Accordingly, OMB 

clearance is not required under the 

Paperwork Reduction Act (44 U.S.C. 

3501 et seq.). 

E. Review Under Unfunded Mandates 

Reform Act of 1995 

The Unfunded Mandates Reform Act 

of 1995 (Pub. L. 104–4) generally 

requires Federal agencies to examine 

closely the impacts of regulatory actions 

on state, local, and tribal governments. 

Subsection 101(5) of title I of that law 

defines a Federal intergovernmental 

mandate to include any regulation that 

would impose upon state, local, or tribal 

governments an enforceable duty, 

except a condition of Federal assistance 

or a duty arising from participating in a 

voluntary Federal program. Title II of 

that law requires each Federal agency to 

assess the effects of Federal regulatory 

actions on state, local, and tribal 

governments, in the aggregate, or to the 

private sector, other than to the extent 

such actions merely incorporate 

requirements specifically set forth in a 

statute. Section 202 of that title requires 

a Federal agency to perform a detailed 

assessment of the anticipated costs and 

benefits of any rule that includes a 

Federal mandate which may result in 

costs to state, local, or tribal 

governments, or to the private sector, of 

$100 million or more in any one year 

(adjusted annually for inflation) (2 

U.S.C. 1532(a) and (b)). Section 204 of 

that title requires each agency that 

proposes a rule containing a significant 

Federal intergovernmental mandate to 

develop an effective process for 

obtaining meaningful and timely input 

from elected officers of state, local, and 

tribal governments (2 U.S.C. 1534). 

This final rule amends DOE’s existing 

regulations governing compliance with 

NEPA to update DOE’s regulations for 

the reasons described in Section I. 

Background, of this document. This 

78204 Federal Register / Vol. 85, No. 234 / Friday, December 4, 2020 / Rules and Regulations 

final rule will not result in the 

expenditure by state, local, and tribal 

governments in the aggregate, or by the 

private sector, of $100 million or more 

in any one year. Accordingly, no 

assessment or analysis is required under 

the Unfunded Mandates Reform Act of 

1995. 

F. Review Under Treasury and General 

Government Appropriations Act, 1999 

Section 654 of the Treasury and 

General Government Appropriations 

Act, 1999 (Pub. L. 105–277) requires 

Federal agencies to issue a Family 

Policymaking Assessment for any 

proposed rule that may affect family 

well-being. This final rule will not have 

any impact on the autonomy or integrity 

of the family as an institution. 

Accordingly, DOE has concluded that it 

is not necessary to prepare a Family 

Policymaking Assessment. 

G. Review Under Executive Order 13132 

E.O. 13132, ‘‘Federalism,’’ 64 FR 

43255 (Aug. 4, 1999), imposes certain 

requirements on agencies formulating 

and implementing policies or 

regulations that preempt state law or 

that have federalism implications. 

Agencies are required to examine the 

constitutional and statutory authority 

supporting any action that would limit 

the policymaking discretion of the states 

and carefully assess the necessity for 

such actions. DOE has examined this 

final rule and has determined that it 

will not preempt state law and will not 

have a substantial direct effect on the 

states, on the relationship between the 

national government and the states, or 

on the distribution of power and 

responsibilities among the various 

levels of government. No further action 

is required by E.O. 13132. 

H. Review Under Executive Order 12988 

With respect to the review of existing 

regulations and the promulgation of 

new regulations, section 3(a) of E.O. 

12988, ‘‘Civil Justice Reform,’’ 61 FR 

4729 (Feb. 7, 1996), imposes on 

Executive agencies the general duty to 

adhere to the following requirements: 

(1) Eliminate drafting errors and 

ambiguity; (2) write regulations to 

minimize litigation; and (3) provide a 

clear legal standard for affected conduct 

rather than a general standard and 

promote simplification and burden 

reduction. With regard to the review 

required by section 3(a), section 3(b) of 

E.O. 12988 specifically requires that 

Executive agencies make every 

reasonable effort to ensure that the 

regulation: (1) Clearly specifies the 

regulation’s preemptive effect, if any; (2) 

clearly specifies any effect on existing 

Federal law or regulation; (3) provides 

a clear legal standard for affected 

conduct while promoting simplification 

and burden reduction; (4) specifies the 

retroactive effect, if any; (5) adequately 

defines key terms; and (6) addresses 

other important issues affecting clarity 

and general draftsmanship under any 

guidelines issued by the Attorney 

General. Section 3(c) of E.O. 12988 

requires Executive agencies to review 

regulations in light of applicable 

standards in section 3(a) and section 

3(b) to determine whether they are met 

or it is unreasonable to meet one or 

more of them. DOE has completed the 

required review and determined that, to 

the extent permitted by law, this final 

rule meets the relevant standards of E.O. 

12988. 

I. Review Under Treasury and General 

Government Appropriations Act, 2001 

The Treasury and General 

Government Appropriations Act, 2001 

(44 U.S.C. 3516 note) provides for 

agencies to review most disseminations 

of information to the public under 

guidelines established by each agency 

pursuant to general guidelines issued by 

OMB. 

OMB’s guidelines were published at 

67 FR 8452 (Feb. 22, 2002), and DOE’s 

guidelines were published at 67 FR 

62446 (Oct. 7, 2002). DOE has reviewed 

this final rule under the OMB and DOE 

guidelines and has concluded that it is 

consistent with applicable policies in 

those guidelines. 

J. Review Under Executive Order 13211 

Executive Order 13211, ‘‘Actions 

Concerning Regulations That 

Significantly Affect Energy Supply, 

Distribution, or Use,’’ 66 FR 28355 (May 

22, 2001), requires Federal agencies to 

prepare and submit to OMB a Statement 

of Energy Effects for any proposed 

significant energy action. A ‘‘significant 

energy action’’ is defined as any action 

by an agency that promulgated or is 

expected to lead to promulgation of a 

final rule, and that: (1)(i) Is a significant 

regulatory action under E.O. 12866, or 

any successor order, and (ii) is likely to 

have a significant adverse effect on the 

supply, distribution, or use of energy; or 

(2) is designated by the Administrator of 

OIRA as a significant energy action. For 

any proposed significant energy action, 

the agency must give a detailed 

statement of any adverse effects on 

energy supply, distribution, or use 

should the proposal be implemented, 

and of reasonable alternatives to the 

action and their expected benefits on 

energy supply, distribution, and use. 

This regulatory action would not have a 

significant adverse effect on the supply, 

distribution, or use of energy, nor was 

it determined to be a significant energy 

action by the OIRA Administrator, and 

it is therefore not a significant energy 

action. Accordingly, DOE has not 

prepared a Statement of Energy Effects. 

K. Review Under Executive Order 12630 

DOE has determined pursuant to E.O. 

12630, ‘‘Governmental Actions and 

Interference with Constitutionally 

Protected Property Rights,’’ 53 FR 8859 

(Mar. 18, 1988), that this final rule 

would not result in any takings that 

might require compensation under the 

Fifth Amendment to the United States 

Constitution. 

L. Review Under Executive Orders 

13771 and 13777 

On January 30, 2017, the President 

issued E.O. 13771, ‘‘Reducing 

Regulation and Controlling Regulatory 

Costs.’’ E.O. 13771 states that the policy 

of the executive branch is to be prudent 

and financially responsible in the 

expenditure of funds, from both public 

and private sources. E.O. 13771 states 

that it is essential to manage the costs 

associated with the governmental 

imposition of private expenditures 

required to comply with Federal 

regulations. 

Additionally, on February 24, 2017, 

the President issued E.O. 13777, 

‘‘Enforcing the Regulatory Reform 

Agenda.’’ E.O. 13777 requires the head 

of each agency to designate an agency 

official as its Regulatory Reform Officer 

(RRO). Each RRO oversees the 

implementation of regulatory reform 

initiatives and policies to ensure that 

agencies effectively carry out regulatory 

reforms, consistent with applicable law. 

Further, E.O. 13777 requires the 

establishment of a regulatory task force 

at each agency. The regulatory task force 

is required to make recommendations to 

the agency head regarding the repeal, 

replacement, or modification of existing 

regulations, consistent with applicable 

law. At a minimum, each regulatory 

reform task force must attempt to 

identify regulations that: 

(i) Eliminate jobs, or inhibit job 

creation; 

(ii) Are outdated, unnecessary, or 

ineffective; 

(iii) Impose costs that exceed benefits; 

(iv) Create a serious inconsistency or 

otherwise interfere with regulatory 

reform initiatives and policies; 

(v) Are inconsistent with the 

requirements of Information Quality 

Act, or the guidance issued pursuant to 

that Act, in particular those regulations 

that rely in whole or in part on data, 

information, or methods that are not 

publicly available or that are 

Federal Register / Vol. 85, No. 234 / Friday, December 4, 2020 / Rules and Regulations 78205 

insufficiently transparent to meet the 

standard for reproducibility; or 

(vi) Derive from or implement 

Executive Orders or other Presidential 

directives that have been subsequently 

rescinded or substantially modified. 

DOE concludes that this rulemaking is 

consistent with the directives set forth 

in these Executive Orders. This final 

rule will update and improve efficiency 

in DOE’s implementation of NEPA by 

appropriately focusing DOE’s NEPA 

analysis for natural gas export 

applications and eliminating certain 

requirements of its existing regulations 

that are unnecessary. 

M. Congressional Notification 

As required by 5 U.S.C. 801, DOE will 

submit to Congress a report regarding 

the issuance of this final rule prior to 

the effective date set forth at the outset 

of this rulemaking. The report will state 

that it has been determined that the rule 

is not a ‘‘major rule’’ as defined by 5 

U.S.C. 801(2). 

Approval of the Office of the Secretary 

The Secretary of Energy has approved 

publication of this final rule. 

List of Subjects in 10 CFR Part 1021 

Environmental impact statements. 

Signing Authority 

This document of the Department of 

Energy was signed on November 24, 

2020, by William S. Cooper III, General 

Counsel, pursuant to delegated 

authority from the Secretary of Energy. 

That document with the original 

signature and date is maintained by 

DOE. For administrative purposes only, 

and in compliance with requirements of 

the Office of the Federal Register, the 

undersigned DOE Federal Register 

Liaison Officer has been authorized to 

sign and submit the document in 

electronic format for publication, as an 

official document of the Department of 

Energy. This administrative process in 

no way alters the legal effect of this 

document upon publication in the 

Federal Register. 

Signed in Washington, DC, on November 

25, 2020. 

Treena V. Garrett, 

Federal Register Liaison Officer, U.S. 

Department of Energy. 

For the reasons stated in the 

preamble, DOE amends part 1021 of 

Chapter X of Title 10 of the Code of 

Federal Regulations as set forth below: 

PART 1021—NATIONAL 

ENVIRONMENTAL POLICY ACT 

IMPLEMENTING PROCEDURES 

■ 1. The authority citation for part 1021 

continues to read as follows: 

Authority: 42 U.S.C. 7101 et seq.; 42 U.S.C. 

4321 et seq.; 50 U.S.C. 2401 et seq. 

■ 2. Appendix B to subpart D of part 

1021 is amended by: 

■ a. Revising section B5.7; and 

■ b. Removing and reserving section 

B5.8. 

The revision reads as follows: 

Appendix B to Subpart D of Part 1021— 

Categorical Exclusions Applicable to 

Specific Agency Actions 

* * * * * 

B5. * * * 

* * * * * 

B5.7 Export of natural gas and associated 

transportation by marine vessel 

Approvals or disapprovals of new 

authorizations or amendments of existing 

authorizations to export natural gas under 

section 3 of the Natural Gas Act and any 

associated transportation of natural gas by 

marine vessel. 

B5.8 [Removed and Reserved] 

* * * * * 

Appendix C to Subpart D of Part 1021— 

Classes of Actions That Normally 

Require EAs But Not Necessarily EISs 

C13 [Removed and Reserved] 

■ 3. Remove and reserve section C13. 

Appendix D to Subpart D of Part 1021— 

Classes of Actions That Normally 

Require EISs 

D8 and D9 [Removed and Reserved] 

■ 4. Remove and reserve sections D8 

and D9. 

[FR Doc. 2020–26459 Filed 12–3–20; 8:45 am] 

BILLING CODE 6450–01–P 

SMALL BUSINESS ADMINISTRATION 

13 CFR Part 120 

RIN 3245–AH04 

SBA Supervised Lenders Application 

Process 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Final rule. 

SUMMARY: The U.S. Small Business 

Administration (SBA or Agency) is 

amending the regulations applicable to 

Small Business Lending Companies 

(SBLCs) and state-regulated lenders 

(Non-Federally Regulated Lenders 

(NFRLs) (collectively referred to as SBA 

Supervised Lenders). The key 

amendments to the regulations include 

a new application and review process 

for SBA Supervised Lenders, including 

for transactions involving a change of 

ownership or control. Other 

amendments to the regulations include 

updating the minimum capital 

maintenance requirements, clarifying 

the factors SBA will consider in its 

evaluation of an SBA Supervised Lender 

application and limiting the 7(a) lending 

area for NFRLs. 

DATES: This rule is effective January 4, 

2021. 

FOR FURTHER INFORMATION CONTACT: Paul 

Kirwin, Chief, SBA Supervised Lender 

Oversight Team, Office of Credit Risk 

Management, Office of Capital Access, 

U.S. Small Business Administration, 

409 3rd Street SW, Washington, DC 

20416; telephone: (202) 205–7261; 

email: paul.kirwin@sba.gov. 

SUPPLEMENTARY INFORMATION: 

I. Background Information 

The 7(a) Loan Program is a business 

loan program authorized by section 7(a) 

of the Small Business Act (15 U.S.C. 

636(a)) and is governed primarily by the 

regulations in part 120 of title 13 of the 

Code of Federal Regulations (CFR). The 

core mission of the 7(a) Loan Program 

is to provide SBA-guaranteed financial 

assistance to small businesses that lack 

access to capital on reasonable terms 

and conditions to support our nation’s 

economy. 

Most Lenders participating in the 7(a) 

Loan Program are depository 

institutions that have a primary Federal 

Financial Institution Regulator (as 

defined in 13 CFR 120.10) that oversees 

the Lender’s lending activities. SBA has 

statutory authority under section 

7(a)(17) of the Small Business Act to 

authorize non-federally regulated 

entities to make 7(a) loans, including 

entities that have state regulators. Under 

this authority, SBA has authorized SBA 

Supervised Lenders to make loans in the 

7(a) Loan Program. SBA Supervised 

Lenders are defined in 13 CFR 120.10 to 

include SBLCs and NFRLs, and are 

subject to regulation, oversight, and 

enforcement by SBA. 

SBLCs are non-depository lending 

institutions that are authorized only to 

make loans pursuant to section 7(a) of 

the Small Business Act and loans to 

Intermediaries in SBA’s Microloan 

program. SBLCs are regulated, 

supervised, and examined solely by 

SBA, except for the subset of SBLCs 

defined as Other Regulated SBLCs in 13 

CFR 120.10. SBA imposed a moratorium 

on issuing additional SBA lending