Federal Pipeline Policy pivots toward tribal and environmental interests

Sacred Stone Camp in North Dakota and the Standing Rock Sioux Reservation have become the staging area for protests along the proposed Dakota Access Pipeline route.  Photo: Joe Brusky.

Last November, the Obama Administration denied federal approval of the Keystone XL pipeline, finding that approval of the pipeline was not in the US' interests.  It largely did so because Keystone XL had become THE symbol of environmental resistance.  Previously, energy infrastructure projects had not been particularly controversial.  Even Keystone XL's impacts (both environmental and economic) were overblown by vehement opponents and supporters of the project.  I wrote then that the federal government's rejection signaled a pivot toward environmental protection, especially as the timing of the rejection came just before world leaders met in Paris to negotiate a major climate agreement.  It also represented a major victory for environmentalists, and the power of environmental protests.

The history of Keystone XL has become more salient in recent weeks, as protests over the proposed Dakota Access Pipeline (DAPL) intensified.  DAPL would carry oil from western North Dakota oil fields to an existing pipeline network in Illinois.  Along the way, however, the proposed route crosses federally controlled waterways, as well as sacred tribal lands and burial sites.  The Standing Rock Sioux Tribe, in particular, is also concerned that an oil spill might contaminate their water supplies.  But protests over the pipeline have evolved into a larger battle regarding tribal and environmental interests, on the one hand, and energy security on the other hand.  Other tribes are standing in support of the Standing Rock Sioux, as are scores of celebrities, politicians, environmentalists, and other activists.  Protests have taken place all over the country.  It is possible that these protests and shows of support for blocking the pipeline would have taken place regardless, but it seems more likely that the anti-Keystone XL movement has provided a model for citizens to use political pressure to block pipeline construction.

The legal process took an interesting turn this week, as the D.C. District Court rejected the Standing Rock Sioux Tribe's request for an injunction.  The tribe claimed that, because it was not consulted about the DAPL (as is required by the National Historic Preservation Act), construction of the pipeline would lead the tribe to suffer irreparable harm worthy of a preliminary injunction.  The court appeared sympathetic to the tribe's concerns, opening its decision thusly: "Since the founding of this nation, the United States’ relationship with the Indian tribes has been contentious and tragic."  But ultimately the standard one must meet to be granted a preliminary injunction is a very high one.  As the court noted, "'[I]njunctive relief' is 'an extraordinary remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief'" [citing Winter v. Nat. Res. Def. Advisory Council].  The tribe didn't meet that standard, according to the court, and the injunction was denied.

The legal defeat notwithstanding, pipeline protesters received a significant victory immediately after the court's decision was released.  The US Department of the Interior, Department of Justice, and Army Corps of Engineers issued a joint statement that federal approval of the DAPL would be suspended pending further review.  In addition, the federal government invited tribes and the general public to participate in consultations regarding tribal lands and resources, and the potential need for new legislation.  The joint statement calls into question the viability of the DAPL moving forward - without federal approval, the pipeline will not be able to cross major waterways blocking its path.  The statement represents a remarkable victory for tribes, environmentalists, and pipeline protestors.

This is, therefore, the second major pipeline protest breakthrough in less than one year.  One of three developments is likely true: either the federal administration is pivoting toward tribal and environmental interests, or the political pressure mounted by pipeline protestors is increasingly influential, or both.  The administration's support for tribal and environmental interests can be measured in other ways over the past few years, and that support is likely a factor in this case as well.  But the influence of protest movements in shaping energy politics is undoubtedly a major factor as well.  As mentioned, these types of infrastructure projects rarely took center stage in the past.  Now, they are doing so with regularity.  It will be interesting to see how the DAPL legal and political processes play out.  It will also be interesting to see if more pipeline protests emerge in the near future.  If the Keystone XL and Dakota Access Pipelines are any indication, high-profile pipeline protests may become the new normal.  

Was the President's Keystone XL rejection constitutional?

An oil pipeline near the Copper River in Alaska.  Photo: Luke Jones.

In the run-up to the COP 21 Climate Conference, US energy politics was dominated by President Obama's rejection of TransCanada's proposed Keystone XL pipeline.  The pipeline would have extended and modified the route of the existing Keystone pipeline, facilitating the extraction of Canadian tar sands oil and helping bring it to market.  Before the decision was made, I wrote about the impact a rejection of the pipeline might have on COP 21 negotiations:

If the pipeline were rejected before the COP 21 negotiations, it would further cement the feeling (shared by myself and others) that the Keystone XL fight is largely a symbolic one [...] Admittedly it's hard to quantify the extent to which a rejection of Keystone XL would bolster the US position on climate change during COP 21 negotiations, but if the administration is looking to maximize its leverage with other countries, a decision on the pipeline would be a bold move.  

As it turned out, the perception that Keystone XL would contribute to global climate change was a major factor in rejecting the project.  The State Department had already concluded that other environmental impacts would be minimal (a disputed claim), and even questioned the idea that Keystone XL would have a meaningful impact on GHG emissions.  Still, it would have been difficult to push the international community towards climate action if the US President didn't appear to be taking action himself.

It's now clear that TransCanada intends to use that reasoning against the President.  In a brief filed in January in a federal district court in Houston, Texas, TransCanada alleges that the President's rejection of the pipeline was unconstitutional.  This week several states (Oklahoma, Kansas, Montana, Nebraska, South Dakota, and Texas) filed a brief in support of TransCanada's claims.  The most interesting claim is that the President lacks the constitutional authority to reject a pipeline project.  Here is the gist of the argument:

Essentially, the argument boils down to this: Congress has constitutional authority to regulate foreign and domestic commerce; Congress has not delegated that authority to the President; and to the extent that Presidents have traditionally exercised approval power in the past, none have rejected an international pipeline on the basis that it would undercut the President's bargaining power in unrelated international negotiations.

There is some merit to the claim, but of course, the issue is not as clear-cut as the brief suggests.  While Congress has not expressly delegated approval powers to the President, it has not established a statutory scheme for regulating international pipelines either.  So there is an absence of regulation, within which several Presidents have stepped in to make approvals and regulate international pipelines to some extent.  Here is Prof. James Coleman on the federal government's likely response:

President Obama’s administration will raise several counterarguments. First, it will argue that the President has inherent and unilateral constitutional authority to control the nation’s borders, so he must have some kind of ability to control international border crossings. Second, if Congress has not established any criteria for the President to use in this decision, then he is free to create his own criteria. Third, President Johnson established this process almost fifty years ago and it has been frequently used to approve pipelines so Congress has, with the passage of time, acquiesced to this process. Fourth, federal district courts have upheld the President’s unilateral decision to approve international pipelines.

The process President Johnson established was Executive Order 11423 in 1968, which allowed the President to approve international pipelines as long as they serve the national interest.  Presidents have long followed this process, and until the Keystone XL rejection, it was largely uncontroversial.  What TransCanada is arguing, however, is not just that the President doesn't have constitutional authority to approve or reject international pipeline proposals; even if they lose that point, they can argue that in this specific case, the rejection was based on the project's perceived impacts, not its actual impacts.  

A comprehensive energy policy framework does not exist, and for the most part, has never existed.  That absence results in some constitutional ambiguities, such as the one in this case.  I think it likely that the President's authority to review and approve/reject international pipelines will be upheld in federal court; cross-border pipelines are sufficiently related to foreign affairs, even if foreign and domestic commerce is implicated as well.  However, the government should expect to receive some flack for its reasoning.  In the future, pipeline decisions may be more closely based on the substantive review of the project and its direct impact on the national interest as a result of this challenge.  

Keystone XL and the COP 21 Deadline, Ctd

That was fast.  President Obama announced today that his administration would not be approving TransCanada's proposal to build the Keystone XL pipeline.  The decision came two days after the administration denied TransCanada's request to delay a final decision.  And on Wednesday I wrote:

If the pipeline were rejected before the COP 21 negotiations, it would further cement the feeling (shared by myself and others) that the Keystone XL fight is largely a symbolic one [...] Admittedly it's hard to quantify the extent to which a rejection of Keystone XL would bolster the US position on climate change during COP 21 negotiations, but if the administration is looking to maximize its leverage with other countries, a decision on the pipeline would be a bold move.  

President Obama appears to share those views.  On the symbolic nature of the Keystone XL fight:

“This pipeline would neither be a silver bullet for the economy, as was promised by some, nor the express lane to climate disaster proclaimed by others”

The President was also forthcoming about the influence that COP 21 had on his decision:

Obama said the Keystone decision was important ahead of the summit to reinforce the United States’ global leadership and commitment to combating climate change. “Approving this project would have undercut that global leadership,” Obama said. “If we want to protect the worst effects of climate change before it’s too late, the time to act is now.”

The NYT also points out that US-Canada relations may have played a large role in the timing of the decision:

The recent election of a new Canadian prime minister, Justin Trudeau, may also have influenced Mr. Obama’s decision. Mr. Trudeau’s predecessor, Stephen Harper, had pushed the issue as a top priority in the relationship between the United States and Canada, personally urging Mr. Obama to approve the project. Blocking the project during the Harper administration would have bruised ties with a crucial ally. While Mr. Trudeau also supports construction of the Keystone pipeline, he has not made the issue central to Canada’s relationship with the United States, and has criticized Mr. Harper for presenting Canada’s position as an ultimatum, while not taking substantial action on climate change related to the oil sands.

Here's the full announcement:

Keystone XL and the COP 21 Deadline

A pumping station on the (existing) Keystone Pipeline System, Nebraska.  Photo: Shannon Ramos.

The proposed Keystone XL pipeline is in the news again this week, after the pipeline company (TransCanada) requested that the US State Department delay its decision to approve or reject the project.  Ostensibly TransCanada made the request on the grounds that there are outstanding siting issues to work out in Nebraska, but the more likely reason is that the company fears the Obama administration will soon issue its rejection, possibly in the run-up to the COP 21 climate negotiations in Paris.  The administration will be trying to obtain as many concrete climate commitments from other nations as possible, and a rejection of the Keystone XL pipeline would send a strong message that the US is committed to the COP 21 process.  A delay, on the other hand, would likely push the decision onto the next president (many of whom have declared support for the project).  Today the State Department announced it would not grant TransCanada's request, and suggested that a decision will be made before the president leaves office.

If the pipeline were rejected before the COP 21 negotiations, it would further cement the feeling (shared by myself and others) that the Keystone XL fight is largely a symbolic one.  Supporters trump up the job-making potential of the pipeline, but those hopes are overblown ("between 35 and millions," according to Jon Stewart), and most jobs would be short-term construction positions.  On the other hand, approving the pipeline isn't likely to be the apocalyptic death to the climate system some project, largely because the oil can find its way to global markets by other means (one pipeline being proposed would take tar sands oil from Alberta to the Pacific Ocean, across sensitive wilderness areas and First Nations lands).  

That's not to say the symbolic fight doesn't matter.  Landmark victories have been hard to come by for the environmental movement in recent years, especially when it comes to climate change.  Demonstrating the ability to defeat a large energy project supported by the oil and gas industry and many Congressional politicians would be a monumental achievement and might catalyze other organized campaigns.  And doing so at the moment when the US is trying to show leadership during COP 21 climate negotiations would amplify the impacts of that achievement.  So while rejecting the pipeline project itself may not have a significant impact on GHG emissions directly, it may have a very significant impact indirectly. 

Ultimately that may be the most relevant long-term outcome of the Keystone XL fight.  Even if the pipeline is rejected, TransCanada can resubmit its application when the next administration takes office (the costs of going through the permitting process and NEPA review are significant but not insurmountable, and there are few legal obstacles that would prevent the company from resubmitting some variation of the initial proposal).  And while many are focused on the political influences on the pipeline's destiny, the global price for oil may be just as, if not more, influential.  If oil prices stay low, new investments in oil and gas are unlikely even if Keystone XL is approved.  If prices rise TransCanada can try its luck again with the next president.  Admittedly it's hard to quantify the extent to which a rejection of Keystone XL would bolster the US position on climate change during COP 21 negotiations, but if the administration is looking to maximize its leverage with other countries, a decision on the pipeline would be a bold move.