Houston Partner Ben Cowan Quoted by Law360 on Slowdown of Energy Infrastructure Projects and Costly Delays After Federal Court Ruling Vacated Nationwide Permit 12

April 27, 2020

Ben Cowan, a Partner in the Firm’s Environmental Section, was quoted by Law360 on the impact of U.S. District Judge Brian Morris’ decision to vacate Nationwide Permit 12, which is used by the U.S. Army Corps of Engineers to enable streamlined approvals for many energy infrastructure projects. The ruling will have severe consequences for the approval process and ongoing projects and results in costly delays, Cowan said, noting that extended delays also increase pressure on tighter-deadline projects and those for which permitting alternatives may not work, putting into question their overall viability.

"I think it's inevitable that it's going to slow down quite a number of projects," Cowan said of the judge's ruling. "Particularly when it comes to a project that is under construction and you've got heavy equipment and contractors mobilized. Delays are incredibly costly and on their own can be fatal to a project."

Cowan also said endangered species may be present at a location only at certain times of year, so tree-clearing might only be allowed during a certain time frame. If a developer were to miss that window because of the permitting uncertainty, he explained, they'd have to wait until the next window opened months down the line. He further noted that delays can also cause missed contractual deadlines for delivering the product or the power.

Cowan continued, "Then there's the question of financing for these projects. Many of them, particularly in the renewables industry, are relying on third-party financing, which generally involves risk-averse lenders and investors who require legal opinions regarding compliance with laws and permits."

To read the full article, click here (subscription may be required).