NEW YORK (Legal Newsline) -- A three-judge federal panel has denied a request for review of a Certificate of Public Convenience and an order denying a Request for Rehearing of the Certificate Order for an energy project in Pennsylvania.

The Federal Energy Regulatory Commission was the defendant in the case in the U.S. Court of Appeals for the Second Circuit.

Both reviews were requested by a group of environmentalist organizations, including the Sierra Club, which were attempting to deny permission for the Central New York Oil and Gas Company to build and operate a natural gas pipeline - 39 miles long and 30 inches in diameter - to run through several Pennsylvania counties and to build and operate related facilities.

The court said, according to the National Environmental Policy Act, a federal agency proposing a "major Federal action significantly affecting the quality of the human environment" must prepare a detailed statement about the environmental impact of the proposed action - an environmental impact statement. If an agency is uncertain as to whether the action requires an EIS, it must prepare an environmental assessment."

The Appeals Court opined that it must factor in reviewing a decision whether to issue an EIS how closely the agency looked at the possible effects of the proposed action. It must also consider whether "the agency's decision was arbitrary or capricious." A court may set aside an agency's decision not to require an EIS only upon a showing that it was "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." The court's role is to "insure that the agency considered the environmental consequences" of the federal action at issue.

FERC prepared an EA when it considered the pipeline application. It concluded that an EIS was not required. FERC subsequently issued a permit.

The environmentalists argued that FERC's cumulative impact analysis was inadequate. The court did not concur. It said FERC's analysis of the development of the Marcellus Shale natural gas reserves was sufficient. FERC's discussion of the incremental effects of the project on forests and migratory birds was sufficient according to the three-judge panel.

FERC addressed both issues in the EA and required Central NY Oil to take concrete steps to address environmental concerns raised by petitioners and others. The environmental concerns identified by commenting parties, including the Environmental Protection Agency, were considered and addressed by FERC in the EA and the Rehearing Order.

The Appeals Court ruled that that "FERC properly discharged its responsibilities under NEPA." It considered all of the petitioners' arguments and concluded that "they are without merit."

But the Sierra Club thinks it has merit. The organization feels the court erred.

"I think it is a concern that the courts are looking at FERC as though it has the final say on these issues - when FERC has not done its job. FERC has been a rubber stamp for the industry," said Jeff Tittel, the director of the New Jersey Sierra Club.

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