A New Chapter in New York Energy Permitting: The NESE Pipeline Approval and Its Implications

On November 7, 2025, the New York State Department of Environmental Conservation (“DEC” or the “Department”) issued a Water-Quality Certification under the Clean Water Act, along with related permits, for the Northeast Supply Enhancement (“NESE”) natural gas pipeline proposal. This decision marks a potential sea change in New York’s energy infrastructure permitting landscape – one that may signal a longer horizon for the State’s transition to a carbon-free energy future, as embodied in the Climate Leadership and Community Protection Act ("CLCPA"). 

The NESE project, developed by Williams Companies (via its Transco Gas Pipe Line Co. subsidiary), would route approximately 23.5 miles of new underwater pipeline (17.4 miles within New York waters) from Pennsylvania through New Jersey and under the Raritan and Lower New York Bays to the Rockaway Peninsula in Queens. The project is anticipated to provide approximately 4,000 dekatherms per day of natural gas transportation services to National Grid customers in Brooklyn, Queens, and Long Island. The project has faced a long history of permit denials. The DEC initially rejected water-quality certification in 2018, with additional denials in subsequent years citing concerns regarding sediment disturbances, seafloor contamination, and potential water-quality issues.

However, in this most recent round, New York regulators have reversed course, concluding that the application now satisfies state water-quality standards and that appropriate mitigation conditions can be implemented (including independent third-party monitoring, dredge-management plans, and seasonal work windows) to protect marine species. The permit’s issuance represents a dramatic shift in regulatory posture for this particular natural gas infrastructure project.

Historically, post-CLCPA environmental permitting approvals have emphasized promoting renewable energy generation, energy storage, and other sustainable energy projects, while natural gas and fossil fuel pipelines and related infrastructure have often faced increased scrutiny and more frequent permitting rejections. Up until this point, NESE’s turbulent permitting history seemed to align with this trend. However, several features of NESE’s approval stand out as emblematic of a potential change in the Department’s permitting attitude:

• The Department’s evaluation explicitly referenced regional reliability and energy need, linking the permit decision to a broader view of energy system resilience and supply constraints downstream.
• Mitigation strategies for potential impacts of the project played a central role, and the permit now includes detailed conditions, including independent monitoring, dredge management, and a projected mitigation budget of roughly $23.5 million.
• In a dramatic departure from recent policy, the Department explicitly noted that the CLCPA, and specifically Section 7(2) of the law, was preempted by the Natural Gas Act, and consequently the project could not be assessed for consistency with the mandates of that law, nor could GHG mitigation measures be required as part of an approval. The decision arrives in a political context where state agencies appear more willing to engage with natural gas and fossil fuel infrastructure if it can be packaged as serving reliability or affordability goals, rather than strictly climate transition priorities in furtherance of the State’s renewable energy goals under the CLCPA.
• The decision to permit the NESE pipeline is consistent with NYSERDA’s recently released Draft 2025 New York State Energy Plan that cited reliability as necessitating that New York continues to utilize “the safe and reliable provision of natural gas and petroleum fuels to electric, residential, commercial, industrial, and transportation sectors.” For further insights, see Hodgson Russ’s recent post: New York Shifts from Zero Emissions to a Balanced Energy Future.

Implications and Looking Ahead

Taken together, this approval may be the first sign of a more flexible energy policy and permitting regime in New York, where regulators are more willing to engage with gas infrastructure under certain framing (namely, reliability and affordability). This approval may open the door to other similar projects that were formerly perceived as unfeasible due to misalignment with the State’s climate goals-driven energy policy. While renewables and clean energy will likely remain a priority under the CLCPA’s mandate, gas infrastructure may be judged more on its system role and less subject to categorical denial.

Regardless of the future permitting environment in the State, it is likely that this approval is not the end of the line for the NESE project. Given the project’s prior history of denials, the volume of public comments submitted in response to the project, and the ongoing debate over its place in the broader context of the State’s energy and climate goals, litigation over these approvals is likely to ensue.

The Department has made NESE’s finalized Section 401 Water Quality Certification and Article 15 Excavation & Fill Permit available for review, as well as the project’s Industrial SPDES Permit and Factsheet. A detailed cover letter provides a narrative summary of notable permit conditions. Hodgson Russ will continue to monitor the NESE project’s ongoing efforts towards development, including any litigation that may arise as a result of these permitting approvals.

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