Nebraska's court ruling deeming Keystone XL's route void is a win for landowners, water and climate

This week’s court decision invalidating Keystone XL’s route through Nebraska has reverberations that extend far beyond the borders of that state and is likely to have a major impact on the federal evaluation process.  This decision is a huge win for both the citizens of Nebraska as well as the larger global community that would be subject to the climate impacts from an expanded tar sands industry. It’s important to remember that Nebraska’s concerns surrounding the route for the Keystone XL tar sands pipeline through Nebraska’s most sensitive, water rich regions of the Ogallala Aquifer have weighed heavily in the federal process in the past. In fact, the Administration stopped the National Interest Determination process in late 2011 in order to allow Nebraska’s legal process to determine the route of Keystone XL. Moreover, after Congress passed a bill setting an artificial 60 day deadline on the decision, President Obama later rejected the permit for Keystone XL because it was impossible to decide whether a project was in the nation’s interest without knowing the route through Nebraska. Following the court’s decision finding that the law giving Keystone XL an exemption from the state’s rigorous pipeline siting process is unconstitutional, the people of Nebraska will have a chance to weigh in on the pipeline route through their state. When they do, it is likely Nebraska’s nonpolitical Public Service Commission (PSC) will propose a third route for the pipeline – as Keystone XL’s “new” route only shifted the pipeline by nineteen miles and still sites the massive tar sands pipeline through some of the most sensitive portions of the Oglala Aquifer.The controversial Keystone XL tar sands pipeline would pose a long term risk to our lands, water and climate that is not in the nation's interest - but the pipeline needs a route before officials can consider a final decision.

To appreciate the significant impact that Nebraska’s recent ruling are likely to have on the evaluation of Keystone XL moving forward, it’s useful to take at the history of the project’s process and the impact Nebraskans have had on it. 

In August 2011, the State Department had released a final environmental review for Keystone XL, and agencies had begun to consider the project under the National Interest Determination (NID) process. As federal agencies weighed Keystone XL’s impacts on a national level, Nebraskans had seen TransCanada ignore their concerns surrounding the route of Keystone XL for years.

TransCanada had given its proposed Keystone XL tar sands pipeline as short a route as possible between the Canadian border and Steele City Nebraska. However, this straight line took the massive tar sands pipeline through Nebraska Sandhills - a region known for its porous sandy soils and a rich groundwater table that starts at the ground level and goes down as far as a thousand feet.

While Nebraska’s citizens, its Senators and its Governor had all pressed TransCanada to change the route o avoid their sensitive aquifer, because the state lacked a pipeline siting law, they had little leverage with the Canadian pipeline company and were ignored. When Nebraskans began pressing for a pipeline siting act, TransCanada, which had already told the State Department that a reconsideration of its route through Nebraska was impossible, said such a move would be unacceptable:

I think the likelihood of that occurring is very slim…What possible new information would be gained by having a state-level siting review? Alex Pourbaix, President of TransCanada Pipelines, September 26, 2011

In a letter to Nebraska State Senators, TransCanada’s Pourbaix reiterated:

 As we discussed in the meeting, at this late date in the federal Presidential Permit process, it is impossible for us to move the route to avoid the Sandhills. Alex Pourbaix, Oct. 18, 2011

Special Legislative Session

On October 24, 2011, Governor Heineman called for a special legislative session to begin on November 1, 2011 to pass a pipeline siting law that would allow Nebraska to weigh in on the route for Keystone XL through Nebraska’s Sandhills, saying:

The key decision for current pipeline discussions is the permitting decision that will be made by the Obama Administration, which is why I have urged President Obama and Secretary of State Clinton to deny the permit,” said Gov. Heineman. “However, I believe Nebraskans are expecting our best efforts to determine if alternatives exist. Therefore, I will be calling a special session of the Nebraska Legislature to have a thoughtful and thorough public discussion about alternative solutions that could impact the route of the pipeline in a legal and constitutional manner. Gov. Heineman, Oct. 24, 2011

During that special legislative session, TransCanada threatened to sue Nebraska if the state enacted a law that would prevent the tar sands pipeline company from routing Keystone XL through its most sensitive groundwater resources in the Sandhills.

However, after several days of hearing from landowners and concerned citizens throughout Nebraska, the State’s committee on Natural Resources approved a pipeline siting bill in the late evening hours of November 9th, 2011.

National Interest Determination process delayed

On November 10th, 2011, the State Department announced that it was stopping the 90 day NID clock, stating:

The concern about the proposed route’s impact on the Sand Hills of Nebraska has increased significantly over time, and has resulted in the Nebraska legislature convening a special session to consider the issue… State law primarily governs routes for interstate petroleum pipelines; however, Nebraska currently has no such law or regulatory framework authorizing state or local authorities to determine where a pipeline goes. Taken together with the national concern about the pipeline’s route, the Department has determined it is necessary to examine in-depth alternative routes that would avoid the Sand Hills in Nebraska in order to move forward with a National Interest Determination for the Presidential Permit. State Department Press Release, Nov. 10, 2011

A few days later, TransCanada belatedly agreed to reroute Keystone XL in Nebraska in accordance with the state’s law, despite having told the Department of State that a reroute of the pipeline was impossible. Alex Pourbaix, who had been telling Nebraskans that their perspective was immaterial to Keystone XL, stated in a press release:

I can confirm the route will be changed and Nebraskans will play an important role in determining the final route. Alex Pourbaix, Nov. 14, 2011

Russ Girling, TransCanada’s CEO, would go a step further. Rerouting Keystone XL, which TransCanada had been telling the State Department and Nebraska’s federal and state was impossible, actually happened to be very easy for the company:

 We can re-route this pipeline quite easily. Russ Girling, Nov. 28, 2011

Nebraska Passes Pipeline Siting Laws

On November 27th, 2011, Nebraska passed two pipeline siting laws. The first law, the Major Oil Pipeline Siting Act, established a process under which Nebraska’s Public Service Commission (PSC) would exercise the state’s authority to site future oil pipelines. However, under threats of lawsuits by TransCanada, the Nebraska Senate exempted all pipelines for which an existing Presidential Permit application was already pending (i.e. Keystone XL) from the Major Oil Pipeline Siting Act.

For Keystone XL, the Unicameral passed the Oil Pipeline Route Certification Act, an expedited review process paid for by the State to move the route from the heart of the Ogallala Aquifer in Nebraska’s Sand Hills. Rather than using the PSC to rigorously assess Keystone XL, the Oil Pipeline Route Certification Act allowed for an expedited review followed by a final certification decision by the Governor.

Congressional Interference

However, on December 23rd, Congress attached an amendment to a payroll tax bill that forced the President to make a decision on Keystone XL’s permit application before a route in Nebraska had been determined.

Placed under this artificial constraint by Congress, on January 18th, 2012 President Obama and the State Department rejected TransCanada’s application to build Keystone XL, finding that it was impossible to determine that Keystone XL was in the national interest without a resolution of the routing concerns in Nebraska and federal environmental review of the new route through that state.

TransCanada lobbies to change pipeline safety law

Keystone XL’s permit rejection created a major problem for TransCanada in Nebraska. It forced TransCanada to reapply under a new permit, and as such Keystone XL would be subject to the more rigorous provisions of the Major Oil Pipeline Siting Act (MOPSA), rather than the Governor’s expedited review process. Rather than go through the legal process set up by the state of Nebraska for other pipeline projects, TransCanada lobbied the state legislature to change the law.

In April 2012, Nebraska passed LB 1161, a bill that amended the MOPSA, allowing oil pipelines which had already received a certification under the Oil Pipeline Route Certification Act to skip MOPSA’s more rigorous review process and be considered under the governor’s lax process. There was no rationale for exempting Keystone XL tar sands pipeline from scientific review by the Nebraska’s PSC. However, TransCanada lobbied hard to get the unconstitutional LB 1161 passed in order to allow it to avoid the PSC’s more rigorous and transparent process.

Just as TransCanada’s initial refusal to engage with concerned citizens regarding its original route, the pipeline company’s attempt to short-cut the process backfired on Wednesday with the court’s decision that the bill it lobbied for was unconstitutional.

The court’s found that the law the governor used to propose Keystone XL route was unconstitutional, the route was void as are any easements TransCanada received through eminent domain or threat of eminent domain. In other words, TransCanada is back to square one in Nebraska.  

Understanding Nebraska’s constitutional pipeline siting process

The MOPSA allows the PSC to obligate a report on Keystone XL’s impact from Nebraska’s Department of Environmental Quality, Department of Natural Resources, Department of Revenue, Department of Roads, Game and Parks Commission, Nebraska Oil and Gas Conservation Commission, Nebraska State Historical Society, State Fire Marshal, and Board of Educational Lands and Funds. The PSC will then schedule a public hearing within 60 days of receiving an application and allows additional public meetings to be scheduled. Under MOPSA, TransCanada has the burden to establish that its proposed route for Keystone XL will serve the public interest after considering whether any other utility corridor could feasibly be used for the route, evidence of the pipeline route's impact due to intrusion on natural resources, evidence of the pipeline carrier's compliance with all applicable laws, rules and regulations, and the various reports received from state agencies.

MOPSA requires the PSC to either approve or deny the application within seven months after it is received, and any order approving an application must state that the pipeline application is ‘in the public interest.’ Any party aggrieved by the decision of the PSC regarding an application under MOPSA (including a decision on whether the application is in the public interest) may appeal the PSC's decision.

It should be noted that there is still significant controversy surrounding TransCanada’s “new” route for Keystone XL through Nebraska. A large part of the governor’s process for getting the route for Keystone XL out of the Sandhills appears to have involved redrawing the map of the Sandhills (see below). As InsideClimate News and E&E News have reported, the new route for the pipeline still places it in some of the most sensitive, sandy regions of Nebraska’s Ogalala Aquifer. And that’s small comfort to Nebraska’s landowners, given the impact that tar sands spills have been shown to have on waterbodies, uncertainties surrounding spill cleanups in aquifers, and Keystone XL’s leak detection system inability to detect leaks smaller than half a million gallons per day.

"Citizens won today. We beat a corrupt bill that Gov. Heineman and the Nebraska Legislature passed in order to pave the way for a foreign corporation to run roughshod over American landowners. We look forward to the Public Service Commission giving due process to a route that TransCanada will have to now submit to this proper regulatory body in Nebraska. TransCanada learned a hard lesson today: never underestimate the power of family farmers and ranchers protecting their land and water." Jane Kleeb, Director of Bold Nebraska, Feb. 19, 2014

Photo courtesy of Bold Nebraska