Water Law Update: Five Regulatory Changes to Watch in 2021

The Legal Intelligencer

(by Lisa Bruderly)

State and federal water law permitting can pose significant obstacles for energy infrastructure construction projects that impact waterbodies (e.g., wells pads, access roads, natural gas/oil pipelines). The following five new and proposed regulatory changes are likely to significantly affect project design and construction in Pennsylvania.

  1. Waters of the United States (WOTUS)

The definition of WOTUS identifies which waters are federally-regulated under the Clean Water Act (CWA), and, therefore, determines when a federal permit is required for projects that involve dredging or filling of a waterbody (i.e., a Section 404 permit). The current WOTUS definition was promulgated in 2020 under the Trump administration. It has been criticized by environmental groups as federally regulating fewer types of waterbodies than the WOTUS definition promulgated under the Obama administration. For example, ephemeral streams are not regulated under the current WOTUS definition.

President Joseph R. Biden Jr. has asked the U.S. Army Corps of Engineers (the Corps) and the U. S. Environmental Protection Agency (EPA) to consider revising or rescinding the current definition. He has also asked courts to stay judicial challenges to the current WOTUS definition while his administration reconsiders the issue.

The Biden administration is expected to propose its own definition of WOTUS, which will, undoubtedly, be more expansive than the current definition and require more projects to obtain federal CWA permitting. Among other things, the Biden administration’s definition of WOTUS is likely to regulate waters (including ephemeral streams) that are considered to have a “significant nexus” with traditionally navigable waters. This definitional change is expected to extend the time and increase cost of permitting for many energy construction projects.

  1. Nationwide Permits (NWPs)

In Pennsylvania, qualifying projects impacting federally regulated waters may be eligible for one of two types of Section 404 general permits (i.e. NWPs or the Pennsylvania State Programmatic General Permit (PASPGP)), in lieu of the more costly, lengthy and complicated process of obtaining an individual Section 404 permit.

In January, the Corps and EPA revised and reissued 12 existing NWPs and created four new NWPs; all of which were effective on March 15, 2021. The revised NWPs largely relate to energy industry activities, including the revision of NWP12 relating to   oil and natural gas pipeline activities.

Pennsylvania subsequently finalized new/revised regional conditions to the NWPs. Many of these regional conditions apply to all NWPs (i.e., regional general conditions); however, other regional conditions apply to a specific NWP or Corps District. In some instances, these new conditions change the eligibility criteria for a specific NWP or change the information required to be submitted as part of a pre-construction notification to the Corps. When planning a project, it is crucial to identify and comply with the new regional general conditions, as well as conditions applicable to the specific NWP and/or Corps District to avoid project revisions and/or the need to switch from a NWP to an individual permit.

As a further consideration, projects intending to use a NWP should evaluate whether the proposed project is still eligible for coverage, either through grandfathering of the prior NWP or coverage under the revised/new NWP. In some instances, a project may no longer be eligible for a NWP, and the project may need to be redesigned or permitted under the lengthier individual permitting process.

Lastly, while the use of many NWPs, including NWP12, has historically been suspended in Pennsylvania, the new/revised regional general conditions allow the use of nine of the new/reissued NWPs in “areas within Pittsburgh District’s area of responsibility in the Commonwealth of Pennsylvania.” Previously, the PASPGP (discussed below) was the only general permit available for many activities. This exception to the NWP suspensions offers potentially increased flexibility to use NWPs in the western part of Pennsylvania, subject to the discretion of the Pittsburgh District.

  1. PASPGP-6

PASPGP-5 expires on June 30, 2021. The Corps has not yet finalized PASPGP-6, which was proposed in September 2020. PASPGP-6, as proposed, would reduce the general permit’s eligibility threshold from one acre of temporary and/or permanent impact to 0.5 acre of permanent impact and unlimited acreage of temporary impact. In addition, the reporting threshold, triggering the need for Corps review, would be based on impacts from the overall project (i.e., all regulated activities), rather than from each crossing single and complete project (i.e., crossing of a single water). Future projects that are anticipating PASPGP-6 authorization should evaluate applicability with these proposed thresholds (if finalized as proposed).

  1. Section 401 Conditional State Water Quality Certification for NWPs

In December 2020, PADEP conditionally granted 401 Water Quality Certification (WQC) for the new/revised NWPs. The conditions of the 401 WQC are incorporated into the NWP regional conditions, as summarized below:

  • All necessary environmental permits or approvals must be obtained from PADEP and all necessary environmental assessments must be submitted to PADEP before beginning any activity authorized by the Corps under a NWP.
  • Fill material may not contain any waste as defined in the Solid Waste Management Act.
  • Applicants and projects eligible for these NWPs must obtain all necessary state permits and/ or approvals to ensure that the project meets Pennsylvania’s applicable water quality standards, including any project-specific WQC.

Project conditions should be reviewed to determine whether they conform with the 401 WQC. If not, the project could require an individual 401 WQC or waiver.

  1. Chapter 105 – In December 2020, PADEP proposed its first substantive revisions to its stream and wetland regulations (i.e., 25 Pa. Code Chapter 105) since 1991. Chapter 105 regulates obstructions and encroachments of waters of the Commonwealth, similar to the Corps’ Section 404 permitting program under the CWA.

Approximately 20 definitions would be added or amended by the proposed rulemaking. Many of the proposed amendments would codify existing application requirements. However, other amendments introduce new or expanded requirements, which could introduce new hurdles for applicants. Many of these revisions relate to performing an alternatives analysis and cumulative impact analyses to demonstrate that a project’s impacts to regulated waters have been minimized or avoided. If finalized as proposed, the rulemaking will likely increase the cost and effort required to obtain a Chapter 105 permit.

Conclusion

As discussed above, 2021 already has, and will continue to, present challenges regarding the permitting of projects that disturb regulated waters, including wetlands, in Pennsylvania. Energy project developers should stay abreast of these regulatory changes to anticipate new requirements and avoid unnecessary delays.

For the full article, click here.

Reprinted with permission from the May 20, 2021 edition of The Legal Intelligencer© 2021 ALM Media Properties, LLC. All rights reserved.