In re PUC Docket HP 14-0001
| Decision Date | 13 June 2018 |
| Docket Number | 28331, 28332, 28333 |
| Citation | 914 N.W.2d 550 |
| Parties | In the MATTER OF PUC DOCKET HP 14-0001, Order Accepting Certification of Permit Issued in Docket HP 09-001 to Construct the Keystone XL Pipeline. |
| Court | South Dakota Supreme Court |
TRACEY ANN ZEPHIER of Fredericks Peebles & Morgan, LLP, Rapid City, South Dakota, Attorneys for appellant, Cheyenne River Sioux Tribe #28331.
THOMASINA REAL BIRD, JENNIFER S. BAKER of Fredericks Peebles & Morgan, LLP, Louisville, Colorado, Attorneys for appellant, Yankton Sioux Tribe #28332.
BRUCE ELLISON, Rapid City, South Dakota, and ROBIN S. MARTINEZ of The Martinez Law Firm, LLC, Kansas City, Missouri, Attorneys for appellant Dakota, Rural Action #28333.
ADAM de HUECK, Pierre, South Dakota, Attorneys for appellee, Public Utilities Commission.
JAMES E. MOORE of Woods Fuller Shultz & Smith P.C., Sioux Falls, South Dakota, and WILLIAM G. TAYLOR of Taylor Law Firm, Sioux Falls, South Dakota, Attorneys for appellee TransCanada Keystone Pipeline.
[¶1.] TransCanada Keystone Pipeline LP (TransCanada) applied to the South Dakota Public Utilities Commission (the Commission) for a permit to construct the Keystone XL Pipeline in South Dakota. Following a contested proceeding, the Commission granted the permit subject to 50 conditions. None of the parties in that proceeding—including Dakota Rural Action, a party to the current appeal—appealed the order issuing a permit. Because TransCanada was unable to commence physical construction within four years, it subsequently certified that it continued to meet the permit conditions as required by SDCL 49-41B-27. Upon receipt of that certification, the Commission opened a docket, allowed the intervention of numerous parties, conducted an evidentiary hearing, and ultimately issued an order accepting the certification. The Cheyenne River Sioux Tribe, the Yankton Sioux Tribe, and Dakota Rural Action (collectively, "Appellants") each appealed the Commission’s decision to circuit court, which affirmed. On appeal to this Court, Appellants argue that the Commission and the circuit court committed numerous errors. We consolidated the appeals, and because the circuit court lacked jurisdiction to hear the appeals, we do not reach the parties' arguments. Therefore, we vacate the circuit court’s decision and dismiss the appeal.
[¶2.] In 2008, TransCanada announced its plan to construct the Keystone XL Pipeline. The Keystone XL Pipeline would connect to existing segments of the Keystone Pipeline system, which carries tar-sands crude oil from Alberta, Canada, to delivery points in Oklahoma and Texas. The proposal included placing a 36-inch-diameter steel pipe capable of transporting up to 900,000 barrels of oil per day. The South Dakota portion of the project would begin at the Montana border and exit into Nebraska. The pipeline would extend 314 miles, crossing portions of Harding, Butte, Perkins, Meade, Pennington, Haakon, Jones, Lyman, and Tripp counties.
[¶3.] On March 12, 2009, TransCanada filed an application with the Commission for a construction permit pursuant to SDCL chapter 49-41B, the South Dakota Energy Facility Permit Act. The Commission opened Docket HP09-001, and on April 6, the Commission issued a notice of application, an order for and notice of public-input hearings, and a notice of opportunity to apply for party status. The Commission held two public hearings on April 27 and a third on April 28, where individuals presented comments and questions at the hearings. In May and June, the Commission granted party status to Dakota Rural Action and fourteen other entities and individuals. Following discovery, the Commission conducted a three-day contested-case hearing beginning November 2, 2009, at which TransCanada, Dakota Rural Action, and Commission staff appeared. The Cheyenne River Sioux Tribe and the Yankton Sioux Tribe, appellants in the present case, were not parties.
[¶4.] On February 18, 2010, the Commission voted to grant the permit subject to 50 conditions,1 including that "Keystone shall comply with all applicable laws and regulations in its construction and operation of the Project" and that "Keystone shall obtain and shall thereafter comply with all applicable federal, state and local permits, including but not limited to: [a] Presidential Permit from the United States Department of State[.]" The project required a presidential permit because the pipeline emanated from Canada and crossed an international border. TransCanada’s application for a presidential permit, filed in 2008, was still pending at the time of the permit hearing. On June 29, 2010, the Commission issued an amended final decision and order granting the permit. No party appealed the Commission’s decision.
[¶5.] Four years later, TransCanada still lacked a presidential permit, and construction of the South Dakota portion of the project had yet to begin. Meanwhile, TransCanada continued to build other portions of the Keystone Pipeline system outside South Dakota. Desiring to move forward with the Keystone XL Pipeline, on September 15, 2014, TransCanada filed a certification with the Commission as required by SDCL 49-41B-27. This statute provides in part that "if ... construction ... commences more than four years after a permit has been issued, then the utility must certify to the Public Utilities Commission that such facility continues to meet the conditions upon which the permit was issued."
[¶6.] In its "Petition for Order Accepting Certification," TransCanada attested that "the conditions upon which the Commission granted the facility permit ... continue to be satisfied." TransCanada stated that it remained "in compliance with the conditions ... to the extent that those conditions have applicability in the current pre-construction phase of the Project" and that "[TransCanada] will meet and comply with all the applicable permit conditions during construction, operation, and maintenance of the Project." TransCanada also attached to its certification a quarterly report and a tracking table of changes. The tracking table identified changes in circumstances to those detailed in the findings made in the Commission’s 2010 final decision and order. For example, TransCanada indicated that the total length of the South Dakota portion of the pipeline had increased by approximately one mile. TransCanada claimed that any such changes were "either neutral or positive to the Commission’s concerns" and that "the need, impacts, efficacy, and safety" of the project had not changed in the intervening years.
[¶7.] The Commission opened docket HP14-001 for consideration of the petition for certification. According to the Commission, certification by a utility rarely attracts much interest. However, given the controversy surrounding the Keystone XL Pipeline and the magnitude of the project, the Commission decided to take extraordinary steps to involve the public. Forty-three individuals and entities applied for intervention, of which 42 received party status. These included the Cheyenne River Sioux Tribe, the Yankton Sioux Tribe, and Dakota Rural Action.
[¶8.] Beginning July 27, 2015, the Commission held a nine-day hearing. Commission Chairman Chris Nelson emphasized at the beginning of the hearing that In addition to TransCanada and the intervenors, Commission staff also appeared as a party. The parties submitted pre-filed testimony, called witnesses, and conducted extensive cross-examination.
[¶9.] In September and October 2015, the parties submitted post-hearing briefs. On November 6, 2015, President Obama issued Executive Order 13337, directing the Secretary of State to reject TransCanada’s application for a presidential permit. In a written statement, President Obama cited the project’s lack of a meaningful long-term contribution to the economy, its inability to lower gas prices for American consumers, and energy security and climate change concerns as reasons for denying the permit. Subsequently, on November 9, 2015, Appellants filed a joint motion to dismiss the petition for certification and to revoke the 2010 permit. Appellants argued that TransCanada could no longer comply with condition 2 of the permit, which required that TransCanada obtain a Presidential Permit. However, at a meeting held on December 22, 2015, the Commission dismissed Appellants' joint motion, reasoning that TransCanada could theoretically comply with the condition in the future.
[¶10.] On January 6, 2016, the Commission approved TransCanada’s petition for certification, and on January 21, the Commission issued its final decision and order accepting certification. Appellants and other intervenors appealed the Commission’s decision to the circuit court. On January 24, 2017, President Trump issued a presidential memorandum inviting TransCanada to reapply for a presidential permit. The memorandum directed the Secretary of State to "take all actions necessary and appropriate to facilitate its expeditious review." TransCanada submitted a new application and on March 23 obtained a presidential permit, which the circuit court took judicial notice of.
[¶11.] On March 8, 2017, the circuit court held oral argument at a consolidated hearing. On June 19, 2017, the court issued a memorandum decision and an order affirming the decision of the Commission. Appellants each filed an appeal with this Court, raising numerous issues pertaining to the merits of the Commission’s decision and the circuit court’s affirmance. After review of the parties' submissions, this Court consolidated all three appeals and requested supplemental briefing on the issue of jurisdiction. Because we conclude that the circuit court lacked jurisdiction to hear the appeal, we do not reach the merits of the case.
[¶12.] As a threshold matter, we...
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