climate change 2009: united states legal & …...• mandatory reporting rulemaking • final...

Climate Change 2009: United States Legal & Regulatory Developments Tom Lindley

Perkins Coie LLPJanuary 15, 2010

• Public Opinion

• International: Copenhagen

• Federal: Legislative and Regulatory

• State and Regional

• WRI Greenhouse Gas Protocol

• Litigation Update

U.S. Climate Change Regulatory Developments:

Overview


Current Public Opinion

That global warming is happening (91% of Democrats; 43% of Republicans)67%

The U.S. should take action to limit emissions regardless of what other countries do56%

We should “increase investment in clean energy sources"82%

The U.S. should sign an international climate treaty “as long as countries like China and India do as well”66%

The government should develop policies aimed at “limiting carbon pollution and other gases that may cause global warming”

67%

Support or Believe…Respondents

-National Wildlife Federation (NWF) poll, 12/09; -Washington Post/ABC News poll, 12/09, http://www.washingtonpost.com/wpsrv/politics/polls/postpoll_121509.html?sid=ST2009121800006


Current Public Opinion

"Americans now are more likely than they have

been in the past to claim understanding of

global warming, to recognize that global

warming could be a threat in their lifetimes, and

to say the effects of global warming have

already begun."

Gallup, April 2008, http://www.gallup.com/poll/106660/little-increase-americans-global-warming-worries.aspx

Climate change considerations are becoming mainstream:

Copenhagen Goals:


International

• 193 nations

• Draft and enter into global agreement

• Extend and expand Kyoto Protocol

• Enable global organization to influence and monitor all nations' efforts to reduce CO2 emissions.

COP-15

Dec. 7-18, 2009

Copenhagen Results:


International

• No legally binding agreement• No emissions targets • Copenhagen Accord not formally endorsed, but participants "take note" • $30 billion pledged over 3 years to support developing nations with goal of $100 billion annual contribution by 2020

COP-15

Dec. 7-18, 2009

Meanwhile, back in Washington…

Major climate legislation tabled during fall/winter healthcare debate:

• H.R. 2454 (Waxman-Markey bill)

• S. 1733 (Kerry-Boxer bill)


Federal

House of Representatives:


Legislation

• HR 2454, "American Clean Energy and Security Act," passed June 26, 2009

• Considered comprehensive clean energy and climate bill

• Establishes cap & trade program covering all stationary sources that emit > 25,000 metric tons of GHGs annually• Caps:

• 3% below 2005 by 2012• 17% below 2005 by 2020• 42% below 2005 by 2030• 83% below 2005 by 2050


Legislation

• New plants built between 2009 and 2020 expected to adopt CCS technologies when they become commercially available

• By 2025, all plants built after 2009 must capture 50% of CO2

• Plants built after 2020 must capture 65% of CO2

• Early movers on CCS rewarded—for every ton sequestered, an electric utility that gets at least half its power from coal to receive bonus emission permits for 10 years

• $1 billion to fund CCS demonstration and deployment annually, funded by a fee on consumers of fossil-based electricity

What would HR 2454 mean for coal-fired power plants?

Senate:


Legislation

• S. 1733, "The Clean Energy Jobs and American Power Act"

• Democrats voted out of EPW committee in November

• Focus on reducing U.S. GHG emissions

• Slightly more stringent reductions than HR bill

• Viewed as "important starting point for Senate deliberations"


Federal

While the future of federal cap-and-trade legislation remains uncertain . . .

One year into his term, President Obama continues to

focus on economy and promote "green" job creation.


Obama Administration

- $2.3 billion in tax credits to create 17,000 "green" jobs in solar, wind, and energy management

- Additional $5 billion for clean energy manufacturing

- 180+ projects in 40+ states to receive tax credits


Obama Administration

Such initiatives are "an important step

toward meeting the goal I've set of

doubling the amount of renewable

power we use in the next three years

with wind turbines and solar panels

built right here in the U.S. of A."

-President Obama, Jan. 8. 2010, remarks to reporters about green jobs and manufacturing, in the East Room of the White House


EPA

And the Environmental Protection Agency

moves steadily toward regulating GHGs…

• "Endangerment Finding"

• Finalized December 7, 2009

• GHG emissions found to endanger public health and welfare

• Paves the way for EPA to begin rulemaking to regulate and reduce GHG emissions under CAA

• First-ever federal tailpipe standards for GHGs• Require industrial sources to install GHG-reducing "BACT" (Best Available Control Technology)• Proposed "tailoring" rule


EPA

• September 30, 2009, EPA proposed rule to exempt smaller GHG emitters from CAA permitting

• Draft rule would require facilities emitting > 25,000 tons annually to account for emissions when obtaining CAA permits:

• Power plants

• Refineries

• Large industrial facilities

• Current permitting thresholds under CAA are 100 or 250 tons per year.

• Rule would "tailor" permitting programs to limit number of facilities required to obtain New Source Review and Title V permits

• Excludes small farms, restaurants, schools, and other small facilities

Proposed Tailoring Rule


EPA

• Mandatory Reporting Rulemaking

• Final rule published October 30, 2009

• Establishes mandatory GHG reporting regime covering all sectors of U.S. economy

• 10,000 facilities; 85% of U.S. GHG emissions

• Emitters with > 25,000 metric tons annually

• First reports submitted to EPA in 2011 for 2010 (vehicle and engine manufacturers delayed 1 year)

Pew Center on Global Climate Change 2009

U.S. Climate Change Regulatory

Developments:

State/Regional

• WCI:

• Essential Requirements of Mandatory Reporting released

• RGGI:

• March 18, 2009: member states conduct third allowance auction

• December 30, 2009: RGGImembers and PA sign MOU to develop regional LCFS

• Indeck lawsuit settled Jan. 6, 2010

Vehicle Greenhouse Gas Emissions Standards


State/Regional

Pew Center on Global Climate Change 2009


Greenhouse Gas Protocol

• GHG Protocol jointly convened in 1998 by the World Business Council for Sustainable Development (WBCSD) and the World Resources Institute (WRI)

• Provides businesses standardized guidance when developing GHG emissions inventory

• Covers accounting and reporting of six greenhouse gases covered by the Kyoto Protocol

• Aims to:

• Provide "true and fair account of emissions"

• Simplify and reduce costs

• Guide businesses in managing and reducing emissions

• Increase consistency and transparency

• ESA

• Clean Air Act

• NEPA/CEQA

• Clean Water Act

• Common Law

Federal climate change-related litigation continues to grow under both statutory and common law:


Litigation Update

• "There will be more judicial action before there's enacted federal

legislation or international agreement . . . . In the absence of federal

legislation and an international accord, these cases are the leading

beacons for remedying the effects of climate change."

- Professor of Law James May, Widener University*

• "These cases . . . have managed to prop open the door for new lawsuits

against any company or other entity that is a significant greenhouse gas

emitter, creating the possibility of large damages awards or injunctive

relief that alters how defendants like energy companies do their

business."- Bruce Myers, Environmental Law Institute attorney*


Litigation Update

*As quoted in Greenwire, December 17, 2009

Courts are "taking control" of climate change:

Endangered Species Act:

• Center for Biological Diversity v. NOAA (September 3, 2009)

• Plaintiffs claim NOAA/NMFS has denied necessary ESAprotections for ribbon seal "despite clear scientific evidence that the species is threatened by global warming"

• Lawsuit aims to mitigate GHG emissions tied to new development projects

• State of Alaska intervened on December 17, 2009 in support of NMFS' decision not to list ribbon seal

• Polar Bear update

• October 22, 2009, USFW announced proposal to designate critical habitat for polar bear


Litigation Update

• Longleaf Energy Assoc., Inc. v. Friends of the Chattahoochee,

Inc. (July 7, 2009)• Georgia Court of Appeals reversed lower court ruling that would have

required state to conduct CO2 "BACT" review

• Court held that lower court's order would preempt federal efforts to regulate CO2, require the state to invent new regulations and ultimately lead to "a regulatory burden on Georgia never imposedelsewhere."

• Permit upheld; Longleaf to construct first new coal-fired power plant in Georgia in 2 decades

• Ohio Edison Consent Decree

• August 11, 2009 decree requires Ohio Edison Company to reduce GHGs by 1.3 million tons annually as part of CAA settlement agreement

• EPA and DOJ: Consent decree marks first-time mandates for GHG emissions reductions

Clean Air Act:


Litigation Update

NEPA/CEQA:

• CBD v. California Dept. of Forestry and Fire Protection (August 13, 2009)

• Environmental groups sued state regulators over approval of Sierra Nevada logging plan

• Claim plan fails to adequately address/mitigate GHG emissions under CEQA

• Logging eliminates carbon sinks and results in "foregone sequestration"

• Could result in scale-back of logging plans or requirement to mitigate via carbon offsets

• CBD v. Sunrise Powerlink (August 12, 2009)

• Petition for review to the California Supreme Court challenging CPUC's

approval of 150-mile power line that would carry electricity from the Imperial Valley and Mexico to San Diego.

• Claim project violates CEQA based on lack of renewable energy mandate

• CPUC & BLM should have considered impacts of additional GHG

emissions during CEQA/NEPA review


Litigation Update

Clean Water Act:


Litigation Update

• CBD v. EPA (May 14, 2009)

• Plaintiffs allege failure to slow ocean acidification caused by CO2 emissions

• Claim EPA must require Washington State to list coastal waters as "impaired" due to human-induced pH changes

•First-of-its-kind lawsuit, aims to win CO2 regulations under CWA

• Connecticut v. American Electric Power Corp. (2d. Cir.)

• Tort suit against six of nation's largest electric utilities, plaintiffs claimed defendants' GHG emissions cause harmful climate change and should be enjoined as public nuisance

• New York federal court dismissed, holding that remedies for climate change presented "political question" and thus court lacked jurisdiction

• Sept. 2009, 2nd Circuit reinstated suit, affirming plaintiffs' ability to file “nuisance” complaints against GHG emitters under federal common law

• Nov. 4, 2009, defendants requested rehearing, argue ruling contradicts precedent on “traceable injury” required to establish a plaintiff’s standing to sue

Common Law:U.S. Climate Change

Regulatory Developments: Litigation Update

• Comer v. Murphy Oil USA (5th Cir.)

• Property owners brought claims against energy industry defendants in federal Mississippi court

• Claim industry emissions resulted in global warming that caused Hurricane Katrina destruction

• District court dismissed all claims in August 2007

• October 2009, following 2nd Circuit lead, 5th Circuit reinstated plaintiffs' suit

• Held global climate change issues could be considered against emitters in private litigation

Common Law:U.S. Climate Change


• Native Village of Kivalina v. Exxon, et al. (9th Cir.)• February 2008: Alaska village filed suit against energy

and oil companies in California federal court claiming property damages from industrial GHG emissions

• September 2009, Northern District of CA granted all of defendants' motions to dismiss

• November 2009: Plaintiffs filed notice of appeal in 9th

Circuit

• 9th Circuit expected to follow 2nd and 5th Circuit rulings

Common Law cont.:U.S. Climate Change


For more information:

Perkins Coie regularly publishes

client updates regarding recent

developments in climate change law:

www.perkinscoie.com (Practices: Climate Change Law and Policy: Updates)

Questions & Comments

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