US Supreme Court rules Natural Gas Act can authorize pipeline companies to take State property
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US Supreme Court rules Natural Gas Act can authorize pipeline companies to take State property

The US Supreme Court ruled 5-4 Tuesday in PennEast Pipeline Co. v. New Jersey that the Natural Gas Act can grant private companies authority to take state-owned property to build a pipeline.

Under the Natural Gas Act (NGA), a company seeking to build an interstate pipeline must obtain a certificate from the Federal Energy Regulatory Commission. This certificate authorizes the holder to exercise federal eminent domain in securing property for the pipeline.

PennEast Pipeline obtained a certificate to build a 116-mile pipeline from Pennsylvania to New Jersey and sought to exercise its federal eminent domain authority by taking public land in New Jersey. New Jersey moved to dismiss PennEast Pipeline’s request on sovereign immunity grounds. The district court ruled in favor of PennEast Pipeline, but the Third Circuit vacated the order.

In an opinion delivered by Chief Justice John Roberts, the US Supreme Court reinstated the district court order in favor of PennEast Pipeline. The court held that the NGA can constitutionally grant pipeline companies authority to take state-owned property because states “surrendered their immunity from the exercise of the federal eminent domain power when they ratified the Constitution.” The court also noted that the US has long asserted its eminent domain authority to take private property and state-owned property.

Justice Amy Coney Barret, joined by three other justices, wrote a dissenting opinion to remind the court that “Congress passed the Natural Gas Act in reliance on its power to regulate interstate commerce, and [the US Supreme Court has] repeatedly held that the Commerce Clause does not permit Congress to strip the States of their sovereign immunity.” Hence, Barret argued that the NGA cannot authorize certificate holders to take State-owned property.

PennEast Pipeline released a statement to share that they are pleased with the decision. The statement said that “energy crises in recent years in California, Texas, and New England, have clearly demonstrated why interstate natural gas infrastructure is so vital for our way of life, public safety, and enabling clean energy goals.”

New Jersey Attorney General, Gurbir Grewal, said, “We’re disappointed by today’s SCOTUS ruling on the PennEast pipeline, but our fight is far from over. I’m proud to continue standing up for our residents & championing environmental protection. I urge the feds to take another look at this harmful proposal.”