Policy Position: Liquefied Natural Gas Facilities And Threats To Our Security

On February 5th, the heads of our federal intelligence agencies testified before the United States Senate’s Select Committee on Intelligence, uniformly warning that an attempted terrorist attack against the United States is “certain” within the next 3-6 months. Yet, only two days prior to this hearing in Washington, D.C., the Department of Homeland Security, through its local Coast Guard office here in Boston, announced that it would allow liquefied natural gas (LNG) tankers from Yemen, a country linked to recent terrorist plots and known to have a weak internal security system, to enter Boston Harbor this month and make deliveries at the Distrigas terminal in Everett, a facility constructed over 40 years ago. The Boston Globe editorialized that “public officials should have long ago begun planning a safer alternative” to the Everett facility. The problem, however, is that the location of natural gas distribution facilities is a subject governed almost exclusively by federal law, which would pre- empt any attempts at state or local regulation. In other words, it’s not as easy as the Globe suggests to simply “plan a safer alternative.”

The Legal Framework
The approval of new sites for LNG facilities is governed by federal law, the Natural Gas Act (NGA), which was originally passed in the 1930’s. See, 15 U.S.C. §§717 – 717(z). Under a 2005 amendment, the NGA grants the Federal Energy Regulatory Commission (FERC) “exclusive authority to approve or deny an application for the siting, construction, expansion, or operation of an LNG terminal.” §717(b)(e)(1). Under constitutional law principles, Congress’ regulation of LNG terminals means that state and local governments cannot adopt conflicting statutes or requirements. Congress did, however, give states some authority to make binding objections to proposed new facilities. Under the NGA, states can weigh in on proposed new sites through its regulatory authority under the Coastal Zone Management Act (CZMA). See §717b(d)(1). The CZMA gives states an opportunity to review applications to ensure that they are consistent with state regulations. This in effect gives states “a conditional veto over federally licensed or permitted projects.” 16 U.S.C. §1456(c)(3)(a). In Massachusetts, which has an approved “coastal management plan,” an applicant for a new LNG facility must certify with the state’s Office of Coastal Zone Management that the proposed facility is “consistent” with that plan. The state can object to a consistency certification, but the applicant may appeal the decision to the Secretary of Commerce, who can override the objection

on a finding “that the activity is consistent with the objectives of the [NGA] or is otherwise necessary in the interest of national security.” The Secretary’s decision may be reviewed in federal district court.

The Solution
Addressing the immediate threat posed by the Yemeni tanker, the Coast Guard should reconsider its decision in light of the federal intelligence community’s security assessment.

Looking at this issue more broadly, our state’s Coastal Zone Management Plan has not been updated since March, 2002. The threat of terrorism, particular from ships originating in hostile countries, has evolved significantly since then. Our CZMP needs to be updated so that it provides a solid, legal basis for objecting to new LNG terminals and other inherently dangerous activities along our coastline. We need to undertake a “stem to stern” review of our CZM “federal consistency” review procedures to ensure that we are maximally prepared to respond to such proposals. It would be unconscionable if FERC allowed the construction of a new LNG or other liquid fuel terminal in a densely-populated area like Charlestown, Chelsea and Everett simply because Massachusetts did not have an adequate veto mechanism in place.

Dealing with existing facilities like Distrigas in Everett is more problematic. To our knowledge, there are no substantive renewal procedures for LNG terminals, even though a facility may present legitimate concerns in 2010 that did not exist 40 years ago. If a facility like Distrigas’ could not be permitted today on public safety grounds, it should not be permitted to remain.

In connection with its approval of the proposed off-shore LNG terminal in Mount Hope Bay (Fall River) in 2009, the Coast Guard suggested that a “security zone” be enforced around any LNG vessel entering the Bay, with a perimeter of 2 miles ahead, 1 mile astern, and 1,000 yards on either side of the vessel. Requiring such a “security zone” around a vessel sailing to Everett would be impossible – vessels come within 50-100 yards of residential neighborhoods in Boston Harbor. I find it disturbing that safety requirements for new facilities apparently do not need to be met for existing facilities.

As State Senator, I will form a multi-state caucus of legislators and governors to press Congress and the President to amend the Natural Gas Act, to give federal and state regulators the authority to revoke licenses to operate LNG terminals in densely-populated areas if such facilities pose a clear and present danger. At a minimum, the Distrigas facility should be phased out of operation. To ensure a steady flow of natural gas into our country, we should fast-track the permitting and construction of off-shore facilities such as the Weaver’s Cove facility in Narragansett Bay. This decommissioning and replacement process may take years, but if we do not start now, we can never look forward to solving the problem. At the same time, we need to double our efforts to stimulate investment and development in the renewable energy sector, so that we can eventually disconnect ourselves economically from terrorist-linked nations.