Federal Court Nullifies New Jersey Approval for $1B Gas Pipeline to New York City

A federal appeals court has vacated New Jersey's water-quality certification for Williams Cos.' more than $1-billion Northeast Supply Enhancement natural gas pipeline, a decision that injects fresh regulatory uncertainty into a project designed to add 400,000 dekatherms per day of capacity for National Grid customers in New York City and Long Island. The U.S. Court of Appeals in Philadelphia on Sept. 8 sent the Clean Water Act Section 401 certification back to the New Jersey Dept. of Environmental Protection for further proceedings. The ruling matters because the pipeline's Raritan Bay segment crosses both New Jersey and New York waters, and the underwater construction requires dredging a trench, placing the pipe, and backfilling it—work that cannot proceed lawfully without a valid state water-quality certification.

The court found that New Jersey regulators left critical monitoring requirements unresolved. The certification required Transcontinental Gas Pipe Line Co., the Williams subsidiary, to submit water-quality monitoring and adaptive-management plans, but it did not make agency approval of those plans a prerequisite to dredging. Material questions remained open, including thresholds that would trigger mitigation measures, how quickly exceedances must be reported, and whether dredging would stop if corrective measures failed. "No prescribed NJDEP approval stands between the unfinished plans and dredging," the court said. The project includes a new compressor station in Somerset County, the 3.4-mile Madison Loop in Middlesex County, and about six miles of offshore pipeline in Raritan Bay.

The court's technical findings centered on sediment contaminants along the route, which include arsenic, manganese, mercury, polychlorinated biphenyls, and 4,4'-DDE, a breakdown product of DDT. Transco's modeling predicted concentrations of 4,4'-DDE at two sampling locations 500 feet from dredging that exceeded New Jersey's human-health criterion, with one modeled concentration more than 13 times the criterion. Although the final certification reduced the allowable dredging rate and required work during slack tide in that area, the court said DDE concentrations were not recalculated under those operating conditions. New Jersey also required monitoring for turbidity but not the toxic contaminants themselves, and the court said the agency had not explained why monitoring water cloudiness would assure compliance with standards governing DDE, PCBs, mercury, and other contaminants. Judges additionally found the department attributed to state marine experts a prediction that affected surf-clam populations would recover within one to three years when the prediction actually came from Transco.

The decision comes less than three weeks after a separate federal appeals court upheld New York's water-quality certification for the same project. The court cited safeguards in New York's approval—including review of compliance plans before applicable construction can begin, an independent third-party monitor with stop-work authority, and specified pollutant limits—in distinguishing New York's approval from New Jersey's. Williams spokesperson Cherice Corley told Reuters by email that the company is working with state regulators to address the court's findings and remains committed to advancing the project. "At this time, we do not expect the decision to adversely affect project construction or the anticipated in-service timeline," she said. Williams continues to target fourth-quarter 2027 service. Ben Dziobek, executive director of Climate Revolution Action Network, called the decision a win for communities along Raritan Bay, saying no fossil fuel company "gets to cut corners on the protections our communities are entitled to." A coalition of environmental groups filed suit last November against the decision.

The ruling does not invalidate the underlying project approvals or the New York certification, and Williams has signaled it expects to resolve the New Jersey deficiencies without delaying construction. However, the court's remand leaves the New Jersey Dept. of Environmental Protection with the task of explaining how turbidity monitoring alone can assure compliance with contaminant standards, recalculating DDE concentrations under revised operating conditions, and clarifying the source of ecological recovery predictions. Until those technical findings are adequately explained and monitoring plans are made enforceable prerequisites to dredging, the Raritan Bay segment remains legally exposed. The case illustrates how state-level water-quality certifications under Section 401 have become a contested venue for pipeline opponents, even after federal policy shifts. What to watch is whether New Jersey issues a revised certification with explicit approval gates and contaminant-specific monitoring, and whether any further litigation challenges the adequacy of that response.