in Re Application of Encana Oil & Gas Re Beaver Creek Pipeline
329909
Mich. Ct. App.May 16, 2017Background
- Encana (assigned to DTE) applied for ex parte PSC approval to construct two natural-gas pipelines: Garfield 36 and Beaver Creek 11, primarily along existing roads and well-access corridors.
- Initial PSC approvals were vacated by this Court in Buggs v Pub Serv Comm because the PSC had not adequately addressed environmental review under the Michigan Environmental Protection Act (MEPA) and State Hwy Comm v Vanderkloot. The case was remanded for further proceedings.
- On remand the PSC denied Buggs and Bonamie’s renewed motion to intervene; appellants argued the vacatur also reopened the prior denial of intervention. The PSC proceeded without admitting appellants’ affidavits into the record.
- The PSC obtained supplemental environmental information (including MNFI rare-species reviews) and relied on environmental impact assessments (EIAs) prepared by Dean Farrier, who performed on-site route surveys and addressed wetlands, habitat, and construction methods (including directional drilling to avoid wetland disturbance).
- The PSC concluded, based on the EIAs and supplemental records, that neither pipeline would impair the environment, that construction stayed largely within easements and existing corridors, and that issues about future well development/forest fragmentation were not ripe or within PSC jurisdiction.
- Appellants appealed, arguing (1) the PSC improperly denied intervention on remand, (2) the PSC failed to assess environmental impacts in the surrounding vicinity (not just the easement), (3) Farrier’s EIAs were inadequate/unreliable, and (4) the PSC improperly excluded an affidavit reporting dead Kirtland’s warblers.
Issues
| Issue | Buggs' Argument | PSC/DTE Argument | Held |
|---|---|---|---|
| Denial of intervention on remand | Vacatur of PSC pipeline approvals also vacated prior denial of intervention so they should be allowed to intervene | Prior denial of intervention was not appealed and remained in force; remand did not mandate reopening that denial | Denial of intervention on remand was proper; no basis for relief |
| Scope of environmental review (vicinity vs. easement) | PSC should assess environmental impacts in the wider vicinity and consider forest-fragmentation risks | Remand required MEPA/Vanderkloot analysis; PSC complied by reviewing EIAs and supplements; federal "vicinity" rule not applicable | PSC satisfied remand instructions; no requirement to apply federal vicinity rule |
| Adequacy / credibility of EIAs (Farrier) | Farrier lacked credentials, surveys may have missed protected species (e.g., Kirtland’s warbler), timing/methods inadequate | Appellate precedent (Buggs) already held Farrier’s EIAs constituted substantial evidence; PSC further supplemented and found them credible | EIAs and supplemental materials were competent, material, and substantial evidence; PSC reliance upheld |
| Exclusion of petitioners’ affidavits (dead Kirtland’s warblers) | Affidavits showed actual environmental harm and should have been considered | Petitioners were not intervenors; affidavits were not part of the administrative record; PSC need not explicitly address every public comment | Exclusion did not require reversal; record still supported PSC findings |
Key Cases Cited
- State Highway Comm v. Vanderkloot, 392 Mich 159 (discusses MEPA requirements for environmental review)
- Mich Consol Gas Co v. Pub. Serv. Comm., 389 Mich 624 (presumption of PSC orders’ lawfulness and deference principles)
- In re Complaint of Rovas Against SBC Mich, 482 Mich 90 (deference to agency statutory interpretation)
- K & K Constr., Inc. v. Dep’t of Environmental Quality, 267 Mich App 523 (requirement to strictly comply with appellate remand instructions)
- Reeves v. Cincinnati, Inc., 208 Mich App 556 (law‑of‑the‑case doctrine on remand)