Corporate Environmental Lawyer

New MOU For EPA And DoD

By E. Lynn Grayson

EPA and DoD have entered into a new Memorandum of Understanding (MOU) to advance the use of innovative technologies and their mutual interests in sustainability. This MOU is entered into between EPA through its Office of Research and Development, and the Department of Defense through its Office of the Deputy Under Secretary of Defense for Installations and Environment, to establish relations between the two institutions regarding collaboration on their mutual goals.

The Office of Research and Development (ORD) is the scientific research arm of EPA, whose leading-edge research helps provide the solid underpinning of science and technology for the EPA. The work at ORD laboratories, research centers, and offices across the country helps improve the quality of air, water, soil, and the way these resources are used.

The Office of the Deputy Under Secretary of Defense for Installations and Environment ((DUSD-I&E)) is the principal advisor to the Secretary of Defense on matters related to Department of Defense (DoD) installation capabilities, programs, and budgets. Responsibilities include installation-energy programs and policy, environmental management, safety and occupational health, environmental restoration at active and closing bases, conservation of natural and cultural resources, pollution prevention, and environmental research technology.

Subject to mutual consent and availability of funding, EPA and DoD intend to carry out joint activities to advance the development and/or demonstration of new applications and technologies that can be used to achieve mutual sustainability goals. These applications and technologies will use both new and existing data about health and the environment, as well as new data developed within the scope of this MOU.

EPA and DoD intend to cooperate in research, development, and demonstration of technologies that can be used to achieve mutual goals. Joint EPA-DoD activities are expected to be undertaken subject to available funding and resources within each agency. Each party may contribute funding and in-kind resources, depending on the collaborative project, which is consistent with the goals, missions, and programmatic requirements of the party.

The MOU is effective for five (5) years until 2017.

New Chemicals Proposed for Addition to California’s Proposition 65 List

By Katherine M. Rahill

In December and January, the California Environmental Protection Agency's Office of Environmental Health Hazard Assessment ("OEHHA") announced its intent to add seven new chemicals to the Proposition 65 chemicals list:

• Kresoxim-methyl
• Tetraconazole
• Methyl isopropyl ketone
• Benzophenone
• Coconut oil diethanolamine condensate
• Diethanolamine
• 2-Methylimidazole

 The Safe Drinking Water and Toxic Enforcement Act of 1986, otherwise known as Proposition 65, requires the State of California to publish a list of chemicals determined by the State to cause cancer or reproductive toxicity.  There are four mechanisms by which a chemical can be determined to cause cancer or reproductive toxicity sufficient to require listing: (1) either the Carcinogen Identification Committee or the Developmental and Reproductive Toxicant Identification Committee, independent committees of scientists and health professionals that are part of OEHHA's Science Advisory Board, make a determination that there is sufficient evidence that the chemical causes cancer or reproductive impacts; (2) an authoritative body such as the International Agency for Research on Cancer, the National Toxicology Program, or the U.S. Environmental Protection Agency identifies the chemical as causing cancer or reproductive impacts; (3) a state or federal agency requires the chemical to be labeled as causing cancer or reproductive impacts; or (4) the chemical meets certain criteria and is identified in the either of two provisions of the California Labor Code as causing cancer or reproductive impacts.  The listing of a chemical generally imposes two obligations on businesses that use that chemical: (1) businesses must provide a warning before exposing anyone to a chemical on the Proposition 65 chemicals list; and (2) businesses must prevent the discharge of listed chemicals into sources of drinking water. 

 Of the seven chemicals for which OEHHA has published Notices of Intent to list in the last two months, five of the chemicals are being listed through the California Labor Code mechanism, four chemicals as a result of findings that the chemicals are carcinogenic (Benzophenone, Coconut oil diethanolamine condensate, Diethanolamine, and 2-Methylimidazole) and one chemical for evidence of developmental toxicity (Methyl isopropyl ketone).  The other two chemicals are proposed for listing through the authoritative body mechanism as a result of U.S. EPA studies concluding they are capable of causing cancer (Kresoxim-methyl and Tetraconazole).  A comment period was provided by OEHHA for the listing of these chemicals.  Once the comment periods have ended (some of which have expired already), OEHHA will then make a final determination and publish a revised Proposition 65 list, no sooner than 60 days after the publication of the Notices of Intent. 

In addition to the proposed addition of these seven chemicals to the Proposition 65 chemicals list, OEHHA also announced the selection of two chemicals (deltamethrin and xylene) for consideration by the Developmental and Reproductive Toxicant Identification Committee.  The Committee will undertake a review of existing scientific evidence regarding the potential for these two chemicals to cause reproductive impacts.  With the announcement of the selection of these chemicals, OEHHA requested the public provide information relevant to the Committee's review.

 OEHHA's Notices of Intent to list new chemicals can be found by clicking here and Requests for Information can be found by clicking here.

CCX Sued For Fraud

By Steven M. Siros

On December 14, 2011, a group of investors that purchased trading privileges on the Chicago Climate Exchange ("CCX") sued the CCX and its founders, alleging fraud and violations of Illinois' Consumer Fraud and Deceptive Business Practices Act. The lawsuit, which was filed in Illinois state court, contends that defendants falsely represented that only a limited number of trading privileges would be sold and once these privileges were sold, the privileges would be freely transferable. The CCX was acquired by Intercontinental Exchange ("ICE") in April 2010. In August 2011, ICE announced that due to low trading volume on the CCX (attributable to the failure to pass federal cap and trade legislation), the exchange would operate through first quarter 2012 and then shut down. In their lawsuit, plaintiffs allege that they would not have purchased trading privileges on the CCX had they been aware that the privileges would ultimately not be marketable. To see a copy of the complaint, please click here.

New EPA Draft Report Links Contaminants Found In Groundwater To Fracking

By Steven M. Siros

On December 8, 2011, the United States Environmental Protection Agency ("U.S. EPA") issued a draft report noting a need for the collection of more baseline data, greater transparency on the chemical composition of fracking fluids and more care to be exercised with respect to well construction and testing.  The draft report was issued following U.S. EPA's November 9, 2011 release of the preliminary findings of an investigation it conducted near the town of Pavillion, Wyoming which found the presence of chemicals commonly used in fracking (benzene, naphthalene and diesel) in groundwater in the vicinity of 169 natural gas production wells.

Although the draft report recommends additional testing to determine the vertical and horizontal extent of the contamination, the draft report is important for its conclusion that fracking fluids are the likely source of the contamination of the Pavillion drinking water aquifer (after having ruled out agricultural chemicals as a potential contamination source). The draft report is already attracting significant attention. Senator James Inhofe has already gone on record criticizing the draft report, noting that "this announcement is part of President Obama's war on fossil fuels and his determination to shut down natural gas production…. It is irresponsible for EPA to release such an explosive announcement without objective peer review." On the other hand, environmental groups such as the Natural Resources Defense Council have lauded the report as an acknowledgement of its position that fracking poses a significant environmental threat.

Beginning on December 14, 2011, the draft report will undergo a 45-day public comment period and a 30-day peer review process (although not the more heightened peer review that would be required if the draft report were considered a highly influential scientific study).

CDP Issues 2nd Annual Water Disclosure Report

By E. Lynn Grayson

The Carbon Disclosure Project (CDP) launched its second annual Water Disclosure Global Report on Friday, November 16th. It is based upon a questionnaire sent to 315 companies on the Global 500 Index identified as operating in the most water-stressed locations or industry sectors. The CDP report shows some improvement by reporting companies on water management issues but overall, the report concludes that more board-level attention is required to address this critical concern.

The following are some key findings from the process and the report:

1. 190 companies or 60% of identified companies responded to the questionnaire – a 10% increase over last year.
2. Over half (59%) of companies responding reported exposure to water-related risks such as flooding, scarcity and reputational damage.
3. One third (38%) of companies already have experienced water-related business impacts, such as disruption to operations from severe weather events or water shortages.
4. 63% of companies believe that water presents commercial opportunities and commonly identified opportunities relate to increased water efficiency, among others.
5. 72% of companies understood the linkages or tradeoffs between water and carbon emissions.
6. 41% of companies confirm that the biggest water risk facing their businesses is water stress or scarcity.

CDP Water Disclosure collects data annually on water use, strategies, and risks and opportunities from companies on behalf of 354 investors representing US$43 trillion in assets. The Carbon Disclosure Project is an independent not-for-profit organization providing a transformative global system for companies and cities to measure, disclose, manage, and share climate change and water information.

The 2011 CDP Water Disclosure Report is available at https://www.cdproject.net/CDPResults/CDP-Water-Disclosure-Global-Report-2011.pdf.

Criminal Charges Filed For Sale of Fake Renewal Energy Credits; NOVs Issued to Companies that Purchased Fake Credits

By Steven M. Siros

On October 3, 2011, Rodney Hailey, the Chief Executive Officer of Clean Green Fuels, LLC was charged with wire fraud, money laundering, and Clean Air Act violations for allegedly selling $9 million in fake renewable energy credits. According to the complaint, Hailey is alleged to have sold 32 million renewable energy identification numbers representing approximately 22 million gallons of biodiesel fuel. The credits were purchased by oil companies to demonstrate compliance with a provision in the Energy Independence and Security Act that requires these companies to either produce a specific quantity of renewable fuel or purchase renewable energy credits.

On November 7, 2011, U.S. EPA issued notices of violation to 24 companies that had purchased these invalid credits, noting that the use by these companies of invalid credits to demonstrate compliance was still a violation "regardless of that person's good faith that the [credits] were valid at the time they were acquired." U.S. EPA has ordered these 24 companies to submit revised corrected compliance reports within 14 days or face potential penalties of $37,500 per day. Please click here to go to U.S. EPA's website for more information on these notice of violations.

States Seek Review By The U.S. Supreme Court In Asian Carp Case

By Allison A. Torrence

As previously discussed in this blog, the states of Michigan, Minnesota, Ohio, Pennsylvania and Wisconsin have sued the U.S. Army Corps of Engineers and the Metropolitan Water Reclamation District of Greater Chicago, seeking a preliminary injunction aimed at stopping the spread of Asian carp from the Chicago Area Waterway System ("CAWS") into the Great Lakes. The United States Court of Appeals for the Seventh Circuit recently affirmed a lower court's denial of a preliminary injunction in the case of Michigan v. U.S. Army Corps of Engineers. On October 26, 2011, the states filed a Petition for a Writ of Certiorari, asking the U.S. Supreme Court to review and reverse the decision of the Seventh Circuit.

NWF Says Ecosystem Breakdowns in Great Lakes Caused by Excessive Nutrients and Invasive Mussels

By Phoebe B. Scott

On October 4, 2011, the National Wildlife Federation ("NWF")released a report titled Feast and Famine in the Great Lakes: How Nutrients and Invasive Species Interact to Overwhelm the Coasts and Starve Offshore Waters, claiming that a combination of excessive nutrients and invasive zebra and quagga mussels are causing ecosystem breakdowns in the Great Lakes. According to NWF, excessive nutrients are threatening local species by causing large-scale algal blooms in near-shore waters and invasive mussels are reducing fish populations by depleating nutrients, including plankton, that would support shrimp-like crustaceans, a critical link in the food chain.

Update: Great Lakes Week — October 11-14, 2011

By E. Lynn Grayson

EPA has announced a final schedule of meetings and programs for Great Lakes Week headquartered in the Metro Detroit Area. According to EPA, this gathering of annual meetings and conferences of various organizations in one place makes this one of the most wide-ranging Great Lakes summits in history.

For more on the Great Lakes Restoration Initiative visit http://www.glri.us/.

New USGS Report Finds Wells Contaminated

By E. Lynn Grayson

According to a new study by the U.S. Geological Survey, Trace Elements and Radon in Groundwater Across the United States, 1992-2003, about 20% of untreated water samples from public, private and monitoring wells contain concentrations of at least one trace element, such as arsenic, manganese and uranium, at levels of potential health concern.

These findings are based on over 5,000 samples collected primarily from public and private wells nationwide. This study is part of efforts by the U.S. Geological Survey's National Water-Quality Assessment Program to monitor the quality of the nation's groundwater and surface water.

Human health benchmarks used in this study include U.S. Environmental Protection Agency Maximum Contaminant Levels for regulated contaminants and Health Based Screening Levels (HBSLs) for unregulated contaminants. HBSLs are unenforceable contaminant threshold guidelines developed by the USGS in collaboration with EPA, and the New Jersey Department of Environmental Protection and Oregon Health Sciences University.

The major findings of the new study include:

• Arsenic, uranium, and manganese, were the trace elements in groundwater that most frequently exceeded USEPA human-health benchmarks.
• Climate and land use are important factors in trace element distribution.
• Basic geology and geochemistry of water samples helps to predict occurrence of trace elements in groundwater.
• The effects of mixtures of trace elements are poorly understood and could cause further health concerns.

More information about the USGS and its national water quality assessment program can be accessed at USGS.gov.