Daniel L. Robertson Feed

In a Choose Your Own Adventure - Approach, EPA Proposes Greenhouse Gas Emissions Standards for New and Existing Power Plants

Tatjana 

  image from environblog.jenner.com

Daniel BLOG

Feltman-Frank

     

By Tatjana Vujic  Allison A. Torrence  Daniel L. Robertson  and Arie Feltman Frank

Today, the US Environmental Protection Agency released its long-awaited proposal for New Source Performance Standards for Greenhouse Gas Emissions from New, Modified, and Reconstructed Fossil Fuel-Fired Electric Generating Units; Emission Guidelines for Greenhouse Gas Emissions from Existing Fossil Fuel-Fired Electric Generating Units; and Repeal of the Affordable Clean Energy Rule (Proposed GHG Rule). This article provides an overview of the Proposed GHG Rule and Power plant identifies some issues that may lie ahead.

I. Basic Architecture of the Proposed GHG Rule

The Proposed GHG Rule includes four parts. First, as a matter of housekeeping, the proposed rule officially rescinds the Affordable Clean Energy (ACE) Rule. The ACE Rule would have set emissions guidelines for states to incorporate into measures to address greenhouse gas (GHG) emissions from existing coal-fired power plants and focused on efficiency improvements. The ACE Rule was promulgated in 2019 to replace the 2015 Clean Power Plan. In 2022, the Supreme Court issued its landmark decision in West Virginia v. EPA, which ruled that the Clean Power Plan exceeded EPA’s authority to regulate GHGs pursuant to the Major Questions Doctrine, an assessment of which can be found in our article West Virginia v. EPA: The Major Questions Doctrine Arrives to Rein in Administrative Power, published in Pratt’s Law Report.[1]

The Proposed GHG Rule then outlines standards of performance and emissions requirements based on the Agency's determination of the best system of emissions reduction (BSER), as required by Section 111 of the Clean Air Act (CAA), for three types of generating units: (A) existing coal-fired power plants, (B) new gas-fired power plants, and (C) existing gas-fired power plants. For each of these categories of generating units, EPA establishes stratified emissions standards and compliance dates dictated by the unit’s anticipated lifespan and capacity factor. Observers may recognize that the targets and dates proposed in the rules are consistent with climate goals already set by many power generators.

II. Operation of the Fuel-Type Subcategory Approach

Within the basic categories of existing coal plants, existing gas plants, and new gas plants, the Proposed GHG Rule applies a schedule for compliance and emissions reduction targets based on an individual plant’s capacity and anticipated lifespan. These standards and subcategories are guided by EPA’s determination of what constitutes the most cost effective and demonstrated technology available, thereby meeting BSER.

  • Existing Coal-Fired Generating Unit GHG Emissions Standards

For existing coal plants, EPA created four subcategories based on the projected lifespan of the individual operating unit. They include coal plants that have not committed to a date certain by which to cease operations, coal plants that have voluntarily committed to cease operations by 2040, coal plants that will retire by 2035, and coal plants that will retire by 2032.

(1) Coal Plants Anticipating Ongoing Operations

If a coal steam unit has not committed to ceasing operations, EPA will require it to meet a standard consistent with carbon capture and sequestration at a 90% capture rate.

(2) Coal Plants with a Voluntary Commitment to Cease Operations by 2040

For a coal plant that has committed to voluntary retirement before 2040, the plant must meet a standard consistent with co-firing 40% natural gas.

(3) Coal Plants Retiring By 2035

With respect to a coal plant retiring in the near term, i.e., it plans to discontinue operations by 2035, EPA proposes a more relaxed standard. The more relaxed standard requires, in addition to routine operation and maintenance activities, the plant to accept a capacity limitation of 20% by 2030 and each year of operation thereafter.

(4) Coal Plants Retiring By 2032

For coal plants with an imminent retirement schedule, which means a coal plant that commits to ceasing operations by 2032, no capacity limitations must be taken. The plant need only continue to fulfill routine operation and maintenance requirements.

The underlying message for coal plants is that if retirement looms near on the horizon, then there is not an expectation for significant investments to be made in the plant.

  • New Gas-Fired Electric Generating Units

In setting a BSER for GHG emissions from new gas-fired power plants, EPA also uses subcategories to stratify the BSER analysis. In doing so, EPA appears to be striving to strike a balance between a requirement that plants install demonstrated and achievable technology and the observation that infrastructure must exist to support the technology that would make it possible to meet the standards.

The subcategories thus include standards for peaker plants or plants that have a capacity factor of 20% or less, intermediate plants, which include plants with a 20 to an approximately 50% capacity factor (used over a certain amount of time per annum), and baseload plants, which constitute plants with a capacity factor over 50%. The standards are set based on the usage of the plant – the greater the annual operation of the plant, the greater controls and stricter emissions standards required.

(1) New Gas-Fired Peaker Plants / Plants with an Annual Capacity Factor of 20% or Less

Peaker plants include natural gas-fired power plants with a capacity factor of 20% or less. The Proposed GHG Rule would require peaker plants to use clean fuels, which include natural gas, with no other requirements.

(2) New Gas-Fired Intermediate Plants / Plants with an Annual Capacity Factor between 20% and 50%

The intermediate category includes plants with a capacity factor ranging from 20% to approximately 50%. This category generally includes the most efficient simple-cycle plants. By 2032, intermediate plants will be required to meet an emissions standard equal to blending 30% hydrogen by volume into the plant’s fuel stream. The hydrogen must qualify as low GHG hydrogen, which is a standard borrowed from the Inflation Reduction Act’s hydrogen tax credit and is defined in the Inflation Reduction Act as hydrogen generated via a process that results in a lifecycle GHG emissions rate of no more than 4 kilograms of carbon dioxide equivalent (CO2e) per kilogram of hydrogen.[2] In the Proposed GHG Rule, EPA identifies the low hydrogen standard but defers the determination of what constitutes low hydrogen to the Department of Treasury. The Treasury Department is currently developing guidance on the implementation of the production tax credit for clean hydrogen, which includes a decision on how to account for GHG emissions as part of the hydrogen production lifecycle analysis.

(3) New Baseload Gas-Fired Electric Generating Units / Plants with an Annual Capacity Over 50%

For natural gas-fired power plants with an annual capacity factor over 50%, EPA plans to require those plants to employ efficient combined cycle technology in the first phase of operation. This means that when the plant is built, it must implement the most efficient combined cycle technology and meet an emissions standard of 770 lb CO2/MWh-gross standard. Over time, the standard becomes stricter, seemingly to match the anticipated increased availability and advancements in technology in future years, with a choice of one of two pathways. The first pathway requires the increasing use of hydrogen, or an equivalent emissions outcome, and the second pathway would require carbon capture and storage (CCS) or an equivalent emissions outcome.

(3)(a) Hydrogen Pathway for New Baseload Gas-Fired Electric Generating Units

If a baseload plant were to choose to use hydrogen as its path for reducing its GHG emissions, it can anticipate a stepwise timeline. By 2032, the plant will have to reach a level that represents a 30% hydrogen blend by volume or reduce its emissions to an equivalent extent. Then, by 2038, the same plant will need to achieve a 96% blend of hydrogen by volume or reduce its emissions to an equivalent extent. In all instances, the source of hydrogen must meet the standards set for the lowest carbon-emitting hydrogen tax credits, which will be defined by the Department of Treasury.

(3)(b) Carbon Capture and Storage Pathway for New Baseload Gas-Fired Electric Generating Units

If a plant operator were to choose to employ CCS as a means of reducing its GHG emissions, the Proposed GHG Rule would require the plant to reach a 90% capture rate by 2035 or reduce its emissions to an equivalent extent. Note that the 90% capture rate achieves emissions reductions equivalent to a 96% blend of hydrogen in the fuel stream.

  • Existing Gas-Fired Generating Units

Finally, the Proposed GHG Rule not only sets standards for new gas-fired generating units, but also for the largest and most frequently used of the existing gas-fired power plants. These plants include those that generate 300 megawatts or more of electricity per year and operate at a 50% or greater capacity factor. Under the proposal, these plants will be required to meet the 2038 hydrogen pathway standard, the 2035 CCS pathway standard, or achieve the equivalent thereof. For existing gas-fired generating units that do not meet the 300MW and 50% annual capacity factor thresholds, EPA is seeking comment on how it should regulate such units.

III. Anticipated Questions and Challenges

In addition to the obvious legal challenges regarding whether the proposed rule implicates the Major Questions Doctrine and whether the technologies and timelines constitute BSER, there remain questions regarding the definition of what constitutes clean or green hydrogen. Are hydrogen and CCS as achievable as EPA contends? Are the target dates correct? Also, the proposed rule’s new gas turbine standards will apply to any plant for which construction commences after the date of publication of the Proposed GHG Rule. This CAA provision is intended to prevent a rush to commence construction on new plants to lock in the old standards. This may lead to an early challenge of this mechanism because it becomes controlling upon the publication of the proposal and prior to the rule’s finalization.

Another question is how will states, which have two years to develop state plans to incorporate the existing source standards, go about implementing the proposed rule. Will states be able to cooperate to achieve emissions reductions, such as through emissions trading regimes, particularly if such cooperative approaches allow states to achieve equivalent or better results? Why has EPA overlooked other significant emissions reduction options, such as renewable natural gas? How will plant operators pay for these upgrades? EPA has considered the Inflation Reduction Act’s many tax incentives and the Bipartisan Infrastructure Law’s incentives and payments in determining what is economically achievable, but how easy will it be to access such funds, and how can those funds be leveraged?

  • Immediate Takeaways

An initial review of the Proposed GHG Rule indicates EPA has been careful not to step outside the proverbial fenceline. EPA appears to be taking into account the implied guidance provided by the Supreme Court in West Virginia v. EPA that the Agency’s authority under the CAA to regulate power plants should focus on facilities on a unit-by-unit basis rather than an approach that relies on generation-shifting, which the Court determined exceeded EPA’s statutory authority. The rules also appear to be designed in a way and timed to align with other regulatory requirements for the power sector, such as regulations governing wastewater discharges and ozone and mercury emissions, which may streamline investments made in specific plants as well as across the power generation fleet.

Details on the findings that underlie the emissions standards and timing within the proposal will be well litigated. The ultimate question, however, will be whether the overall approach, which entails setting standards for individual plants while still providing options and flexibility by which plant operators can achieve those standards, can thread the judicial scrutiny needle. As you work through these issues, Jenner’s Transitions in Energy and Climate Solutions Practice and Environmental and Workplace Health and Safety Practice are here to help.

 

 

 

 

 

 

 

 

 

Justice Department Issues First-Ever Comprehensive Environmental Justice Enforcement Strategy Report

Robertson  Daniel   

By: Daniel L. Robertson

 

On October 13, 2023, the U.S. Department of Justice’s Office of Environmental Justice (OEJ) released its Comprehensive Environmental Justice Enforcement Strategy Report (Report). The Report outlines what OEJ considers to be its environmental justice successes over the past year since OEJ’s creation, as well as its enforcement strategy moving forward. Regarding successes, the Report highlights the Civil Rights Division’s first ever Title VI environmental justice resolution agreement in Lowndes County, Alabama (read our summary of that agreement here). The Environmental and Natural Resources Division also negotiated interim orders to stabilize drinking water and wastewater systems in Jackson, Mississippi.

Moving forward, OEJ outlines four main principles in its Report:

(1) Prioritizing cases that will reduce public health and environmental harms to overburdened communities. This includes OEJ working with Department of Justice (DOJ) components to help federal investigative agencies evaluate adverse effects on environmental justice communities during their investigations. OEJ also developed a guidance document for DOJ attorneys to develop outreach plans for cases affecting overburdened communities.

(2) Making strategic use of all available legal tools to address environmental justice concerns. Tools highlighted by OEJ include enforcement actions under environmental protection, civil rights, worker safety, and consumer protection laws; the False Claims Act; and appropriate settlement tools such as Supplemental Environmental Projects in the pursuit of timely and effective remedies.

(3) Ensuring meaningful engagement with impacted communities. This includes increased outreach and listening sessions, of which OEJ highlights undertaking over 27 public engagements. OEJ also highlights its development of case-specific community outreach plans in prior matters, and efforts to coordinate engagement across DOJ’s offices as well as other federal agencies.

(4) Promoting transparency regarding environmental justice enforcement efforts and their results. This includes the development of performance standards including pulling performance metrics from DOJ’s Strategic Plan. Performance metrics include the percentage of environmental enforcement matters in or substantially affecting overburdened and underserved communities that are favorably resolved; the percentage of participants in OEJ-facilitated environmental justice events who indicate an increased awareness of DOJ’s efforts to advance environmental justice; and the percentage of trainees who indicate an increased awareness and capacity to identify and address environmental justice concerns.

The Report highlights other actions taken by OEJ over the past year, including appointing an Environmental Justice Coordinator in each of its 94 United States Attorney’s offices and increasing environmental justice training. OEJ further highlights provisions in the report for partnering with other federal enforcement agencies and strengthening coordination with Tribes on environmental justice issues.

Federal agencies continue to provide transparent guidance on their environmental justice strategies. Companies that fall under the purview of a particular agency should consider keeping apprised of these strategies as part of their environmental compliance initiatives. We will continue tracking environmental justice developments on the Corporate Environmental Lawyer.


EPA narrows “Waters of the United States” definition following Sackett ruling

 image from environblog.jenner.comDaniel BLOGByAllison A. Torrence and Daniel L. Robertson 

Free-photo-of-wetlands-by-the-seaThe Environmental Protection Agency and the Army Corps of Engineers recently announced a revised and final rule amending the definition of Waters of the United States (WOTUS) following the Supreme Court decision in Sackett v. EPA that invalidated the agencies’ previous definition. The revised rule took effect immediately upon its publication in the Federal Register on September 8.

The definition of “waters of the United States” is significant because it sets the jurisdictional limits of the Clean Water Act (CWA). Under the CWA, EPA and the Army Corps have the power to regulate, among other things, the discharge of pollutants to navigable water from a point source (33 U.S.C. § 1362(12)) and the discharge of dredged or fill material into navigable waters (33 U.S.C. § 1344). “Navigable waters” are defined in the CWA as “the waters of the United States, including the territorial seas.” 33 U.S.C. §1362(7). “Waters of the United States” is not defined further under the CWA, so the agencies have been left to try to craft a definition.

Since the Supreme Court’s 2006 decision in Rapanos v. United States, the agencies have relied on a “significant nexus” standard to include nearby wetlands and ephemeral waterways in the WOTUS definition. A “significant nexus” was established if the body of water “either alone or in combination with similarly situated wetlands in the region, significantly affect the chemical, physical, and biological integrity of other covered waters more readily understood as navigable.”

In January of this year, the agencies published a “Revised Definition of ‘Waters of the United States’”, which incorporated both a “relatively permanent” standard and a “significant nexus” standard. However, in May 2023, the Supreme Court decision in Sackett v. EPA rejected the “significant nexus” test, instead holding that bodies of water must have a “continuous surface connection” to a traditional navigable water to be a covered wetland (read our analysis of the Sackett decision here).

In consideration of the Sackett ruling, the agencies have again revised their final rule to conform with the Supreme Court’s decision. Under the new rule, “interstate wetlands” are no longer covered, and the “significant nexus” standard is no longer applicable in defining WOTUS. Instead, to be jurisdictional water, a wetland must be “relatively permanent, standing or continuously flowing…” and must have “a continuous surface connection” to a traditional navigable water.

Continue reading "EPA narrows “Waters of the United States” definition following Sackett ruling" »

Proposed NEPA Revisions Seek to Ingrain Environmental Justice into Permitting Decisions

Daniel BLOG By: Daniel L. Robertson

The Council on Environmental Quality recently published the “Bipartisan Permitting Reform Implementation Rule,” the second in a two-phase approach to revising National Environmental Policy Act (NEPA) implementation regulations. An accompanying White House Fact Sheet highlights the proposal’s objectives to accelerate environmental reviews, encourage community engagement, accelerate clean energy advancements, strengthen energy security, and advance environmental justice.

From an environmental justice perspective, the proposed revisions will require agencies, where appropriate, to incorporate mitigation measures that will avoid or reduce a proposed action’s significant adverse health and environmental effects that disproportionately and adversely affect communities with environmental justice concerns. The proposal generally embeds the term “environmental justice” throughout the NEPA regulations, making a facility’s location a determining factor in the degree of review an agency gives a specific proposal, or whether the agency approves the project at all. Agencies must also, “to the fullest extent possible,” encourage and facilitate public engagement in decisions affecting the quality of the human environment, including meaningfully engaging communities with environmental justice concerns.

The revisions require agencies to consider the needs of affected communities when developing outreach and notification strategies. Notably, the proposal replaces the term “public involvement” with “public engagement,” emphasizing that interaction and collaboration is required between agencies and impacted communities, versus simply posting a public notice. That engagement must begin early in the process to seek input on proposals from impacted communities. Agencies are also required to provide sufficient notification to the community, which means making relevant documents accessible for community review. The proposal emphasizes that agencies must respond to public comments, removing a revision under the Trump Administration that an agency “may” respond to public comments. Further, agencies will be required to identify a “Chief Public Engagement Officer” that will be responsible for facilitating the agency’s community engagement. Overall, these processes are intended to make federal agency decisions more accessible and transparent to interested community members.

Besides encouraging early community engagement, the proposed rule also seeks to enhance engagement by removing what it described as “detailed and onerous” requirements that the prior administration imposed on public comments for them to be considered by an agency. These included requirements such as producing supporting information on a position or obtaining an expert to provide certain levels of detail. The proposal also removes a qualifier that the public comment should indicate what specific economic or employment impacts it is addressing. Generally, the expectation is that public comments will increase and more comments will be considered in agency decision-making.

The CEQ is currently holding public meetings on the proposal, with public comments due by September 29, 2023. Interested parties can submit their comments, identified by docket number CEQ–2023–0003, here. Additional information on the public hearings is located here. The first phase received almost 95,000 written comments, and it’s anticipated that this second phase will equally receive significant public attention.

Through this proposal, the Biden Administration is continuing its “whole of government” approach to embracing environmental justice initiatives. While not stated in the revisions, the regulated community should be mindful of these enhanced community engagement and cumulative impact provisions potentially entering future permit application requirements. We will continue to monitor CEQ’s proposed revisions and other environmental justice developments on the Corporate Environmental Lawyer blog.


New EPA Rule Removes Emergency Defense Waiver in Title V Air Permits

 Daniel BLOG image from environblog.jenner.comBy: Daniel L. Robertson and Allison A. Torrence

On July 21, 2023, the Environmental Protection Agency published a final rule eliminating an affirmative defense for Clean Air Act permit emissions violations caused by
Smokestack“emergency” circumstances.

“Major sources” (i.e. sources with actual or potential emissions above certain emission thresholds) are required under Title V of the Clean Air Act to obtain operating permits. When the EPA originally promulgated rules implementing Title V, the proposed rules did not include an emergency affirmative defense provision. However, the EPA included the provisions in its final rule following requests from commenters. Specifically, 40 C.F.R. Parts 70.6(g) (state operating permit program) and 71.6(g) (federal operating permit program) contained identical affirmative defense provisions whereby a source could avoid liability for an emission violation if the violation was caused by an emergency “arising from sudden and reasonably unforeseeable events beyond the control of the source.” This included “acts of God, which situation requires immediate corrective action to restore normal operation, and that causes the source to exceed a technology-based emission limitation under the permit, due to unavoidable increases in emissions attributable to the emergency.” In such circumstances, a source could demonstrate an emergency affirmative defense by providing evidence that:

  1. An emergency occurred and the cause was identified;
  2. The facility was at the time being properly operated;
  3. The facility took all reasonable steps to minimize emission level exceedances and permit requirements during the emergency; and
  4. The permittee submitted notice of the emergency to the permitting authority within two working days.

The EPA’s attempt to remove the Title V emergency affirmative defense has been around since an initial rule proposal in 2016. However, later administrations did not pursue the proposal until a revised version was introduced in 2022. According to the EPA, the affirmative defense is “inconsistent with the EPA’s interpretation of the enforcement structure of the Clean Air Act in light of prior court decisions.” In one of those court decisions, Natural Resources Defense Council v. EPA, 749 F.3d 1055 (D.C. Cir. 2014), the D.C. Circuit Court of Appeals vacated a Title V permit provision that specified an affirmative defense for unavoidable malfunctions. The court held that the EPA exceeded its authority, as only the courts have the authority to decide whether to assess penalties for civil suit violations. The 2014 ruling was upheld in 2016, when the D.C. Circuit in U.S. Sugar Corp. v. EPA, 830 F.3d 579 (D.C. Cir. 2016), reaffirmed that the EPA’s affirmative defense provision at issue intruded on the judiciary’s role in determining Title V permit violation penalties. Similarly, the D.C. Circuit in a 2008 case, Sierra Club v. EPA, 551 F.3d 1019 (D.C. Cir. 2008), vacated an EPA rule exempting emission standards requirements during startup, shutdown or malfunction, finding such exemption in violation of Clean Air Act requirements. These decisions led EPA to revisit similar affirmative defense provisions, resulting in the latest rule.

The EPA states that the provisions’ removal is consistent with other EPA actions, specifically referencing removal or omission of similar affirmative defenses for New Source Performance Standards, emission guidelines for existing sources, and regulations for National Emission Standards for Hazardous Air Pollutants (NESHAP). According to the EPA, the latest action “would harmonize the EPA’s treatment of affirmative defenses across different [Clean Air Act] programs.”

As described in the rule summary, “any impermissible affirmative defense provisions within individual operating permits that are based on a Title V authority and that apply to federally-enforceable requirements will need to be removed.” The EPA has therefore instructed “any states that have adopted similar affirmative defense provisions” in operating permit programs to remove those provisions from their programs within twelve months of the rule’s August 21, 2023 effective date. The EPA expects the same revisions by local and tribal permit programs. Existing Title V operating permits “will eventually need to be revised” to remove language regarding affirmative defense provisions. These changes will likely occur during permit renewals or revisions.

The EPA does not believe the revisions will have a significant impact on sources, noting in the final rule that the Title V emergency defense provisions “have rarely, if ever, been asserted in enforcement proceedings.” Instead, sources more often assert affirmative defenses based on malfunctions, which were not addressed in this rule. In response to the potential chilling effect the rule may have on sources operating to provide vital services during an emergency, the EPA emphasized the enforcement discretion of oversight authorities, as well as accounting for emergency situations in determining remedies. The EPA further stated that the revisions will not restrict a source’s “ability to defend itself in an enforcement action” and that sources will still be able to seek the reduction or elimination of monetary penalties “based on the specific facts and circumstances of the emergency event.”

The proposed rule received significant comments, and legal challenges are likely to be forthcoming. We will continue to track this and other Clean Air Act developments on the Corporate Environmental Lawyer.

Biden Administration Seeks Public Comment on Expanding Environmental Justice Initiatives to Ocean-Related Activities

Robertson  Daniel

 

By:  Daniel L. Robertson, Associate Attorney

 

On June 8, 2023, the Council on Environmental Quality, on behalf of the Ocean Policy Committee (OPC), published a Federal Register request for information seeking public input on the development of a new “Ocean Justice Strategy.”

The OPC is a Congressionally mandated interagency body tasked with coordinating ocean science, technology and management policy across Federal agencies in order to maximize Ocean2 the effectiveness of Federal investments in ocean research and ocean resource management. Codified by the 2021 National Defense Authorization Act, the Committee falls within the National Oceanic and Atmospheric Administration and is led by the Director of the White House Office of Science and Technology Policy and the Chair of the Council on Environmental Quality. The OPC currently consists of at least 25 members, including the Secretary of State, Secretary of Defense, Attorney General, and the Administrator of the Environmental Protection Agency.

In Thursday’s announcement, the Council states that the new ocean justice strategy will “aim to identify barriers and opportunities to fully integrate environmental justice principles into ocean-related activities of the Federal Government.” The strategy will further “propose equitable and just practices to advance safety, health, and prosperity” for communities near oceans and the Great Lakes. Through its request, the OPC is seeking public input “on what the vision and goals of the Ocean Justice Strategy should be and how the Federal Government can advance just and equitable access to, and management and use of, the ocean, the coasts, and the Great Lakes.” The notice provides examples of environmental justice concerns including inequitable placement of polluting infrastructure such as ports and landfills, and inadequate responses to natural hazards like storms and typhoons.

In addition to a general request for any considerations in developing the strategy, the OPC is specifically seeking public input on the following areas:

  • How ocean justice is defined;
  • Barriers and key challenges to realizing ocean justice;
  • What elements, activities and components the strategy should include, including injustices that the federal government should better address;
  • Research and knowledge gaps the federal government should address;
  • How the federal government can harness existing tools (such as the Climate and Economic Justice Screening Tool and EJScreen) to address ocean justice, and what new tools or practices are necessary; and
  • Where and how can the federal government partner with external stakeholders, and what solutions should be led by non-federal entities.

The strategy will further expand the federal government’s advancement of environmental justice initiatives, and follows President Biden’s recent executive order clarifying the administration’s “whole of government” approach to addressing environmental justice, which we previously discussed here. The notice also gives indication as to areas that the OPC may be looking to address, stating that communities have not shared an equitable benefit and burden in ocean-related activities including “climate change, sea level rise and coastal flooding, increased storm intensity, pollution, overfishing, loss of habitat biodiversity, and other threats.”

Public comments are due on or before July 24, 2023, and can be submitted through the federal rulemaking portal located here by referencing docket number CEQ-2023-004. We will continue to monitor environmental justice developments on the Corporate Environmental Lawyer.

Embracing Environmental Justice Initiatives to Advance Corporate Objectives

Siros  Tatjana   Daniel BLOG Feltman-Frank  By    Steven M. Siros, Tatjana Vujic, Daniel L. Robertson and Arie Feltman-Frank

Earth Week 2023 brought with it two significant environmental justice developments. The week began with New Jersey Governor Phil Murphy announcing the adoption of regulations aimed at reducing pollution in historically overburdened communities and those disproportionately impacted by health and environmental stressors. President Biden White House then capped the week off by issuing an Executive Order on Revitalizing Our Nation’s Commitment to Environmental Justice for All which further embeds environmental justice initiatives throughout the federal government (read our analysis of that order here). These actions display the heightened emphasis on environmental justice that has led to these and other significant developments at the federal and state levels.

The United States Environmental Protection Agency (USEPA) defines environmental justice as “the fair treatment and meaningful involvement of all people regardless of race, color, national origin, or income, with respect to the development, implementation, and enforcement of environmental laws, regulations, and policies.” With increased funding provided by the Inflation Reduction Act, the Infrastructure Investment and Jobs Act, and the American Rescue Plan Act, federal agencies are investing at unprecedented levels to advance environmental justice.

The Biden administration also developed the Justice40 Initiative, with a goal of ensuring that 40% of the overall benefits of certain federal investments flow to “disadvantaged communities that are marginalized, underserved, and overburdened by pollution.” The Climate and Economic Justice Screening Tool geospatially identifies such disadvantaged communities, which include federally recognized Tribes and Alaska Native villages.

As companies face increased scrutiny all along the supply chain, including from regulators, customers, investors, and the public, one thing is clear: failure to consider environmental justice implications of corporate activities can significantly hinder the advancement of corporate objectives, including the achievement of climate targets, the effects of which are quite significant. By way of example, in September 2022, a company’s air permits to build a $9.4 billion plastics manufacturing complex were vacated in part because the state Department of Environmental Quality’s environmental justice analysis was found to be arbitrary and capricious, and therefore failed to uphold the “public trust doctrine” of Louisiana’s constitution.

The increased scrutiny and risks associated with failing to consider environmental justice issues is causing some companies to reevaluate corporate policies and develop business practices that embrace environmental justice and community stakeholder initiatives. In this client alert, our team explains how embracing environmental justice and community stakeholder concerns can advance corporate objectives.

A Recent History of Environmental Justice Developments

While the concept of environmental justice has long had its roots in American civil rights history, President Biden brought the topic to the forefront of federal governance as part of the administration’s “whole-of-government” approach to addressing health and environmental impacts on disproportionately affected communities. Through various executive orders, the Biden administration has put its policy of prioritizing environmental justice initiatives and directing federal agencies to make achieving environmental justice a part of their missions into practice. Federal developments thus far have taken the form of plans, new offices and positions, grant programs, mapping tools, reviews of existing legal authority, permitting guidance, and enforcement policies.

Federal, state, and local developments that are particularly relevant to the regulated community are reviewed below.

USEPA’s Legal Authorities to Advance Environmental Justice

USEPA published a May 2022 report, followed by a January 2023 addendum, that reviewed the agency’s legal authority to advance environmental justice and take steps to mitigate the cumulative impacts of federal actions taken under its various programs. The takeaway is that USEPA has existing legal authority to advance and address these topics in decision-making. This authority encompasses the full breadth of the agency’s activities, including its oversight of state programs.

USEPA also has the authority to advance environmental justice through civil rights laws. Title VI of the Civil Rights Act of 1964, for instance, prohibits recipients of federal financial assistance from intentionally discriminating on the basis of race, color, or national origin (including limited English proficiency) in their programs or activities.

USEPA’s implementing regulations also prohibit recipients of federal financial assistance from taking actions that have a discriminatory effect. The regulations offer a mechanism for a person who believes they have been discriminated against to file a complaint with any USEPA office, as well as authorize USEPA’s Office of Civil Rights to periodically conduct compliance reviews. If a recipient is found to be noncompliant, the recipient may elect to take corrective actions to mitigate the risk of losing financial assistance.

Permitting Guidance

USEPA recently issued interim guidance for addressing environmental justice and civil rights during permitting, as well as specific guidance for addressing environmental justice concerns specific to air permitting. The guidance emphasizes that compliance with federal environmental laws does not necessarily provide a shield against allegations of non-compliance with federal civil rights laws.   

For example, in Chicago, the city allegedly agreed to permit a scrap metal recycling facility’s relocation from a predominantly White neighborhood into a predominantly Black and Hispanic neighborhood. After a two year investigation, the US Department of Housing and Urban Development found the city in violation of the Civil Rights Act and the Housing and Community Development Act, stating that the city’s involvement in the relocation of the facility, approval of the new site, and methods used to achieve these objectives were shaped by the race and national origin of the residents of each neighborhood.

Therefore, even beyond what is legally required by the applicable permitting statute and regulations, companies should consider taking steps throughout the permitting process to ensure that environmental justice and civil rights concerns are being sufficiently analyzed and adequately addressed, as well as ensuring sufficient community engagement.   

Enforcement Policies

As outlined in USEPA’s Fiscal Year 2022-2026 Strategic Plan, new environmental justice-focused enforcement policies emphasize increased inspections in communities with environmental justice concerns, prioritizing enforcement in overburdened communities, and identifying remedies for noncompliance that offer tangible benefits to those communities. USEPA also emphasized acting through emergency orders to secure early relief where possible. Enforcement remedies include increased or additional fence-line monitoring, public availability of monitoring data, and encouraging supplemental environmental projects that are tied to addressing adverse environmental impacts on local communities. 

State and Local Developments

In addition to various states that have enacted or are in the process of enacting environmental justice-related legislation, New York recently joined Montana and Pennsylvania by explicitly including a “right to clean air and water, and a healthy environment” in the New York Bill of Rights. Several other states have proposed ballot initiatives to incorporate environmental rights into their constitutions.

At the local level, the focus on environmental justice has propelled some municipalities to address the topic in similar as well as different ways. As a 2019 report prepared by the Tishman Environment and Design Center indicates, municipalities have addressed environmental injustice through various land use measures, including bans on polluting facilities; policies that incorporate environmental justice goals and considerations into municipal activities; environmental review processes; and proactive planning, zoning, and public health codes.

For example, in 2020, Washington, DC amended its comprehensive plan to incorporate environmental justice objectives. Among other things, the plan states that environmental justice principles should inform public policy decisions on the siting of municipal and industrial facilities.

Embracing Environmental Justice as Part of a Company’s Corporate Culture

Considering the heightened focus on environmental justice outcomes, companies would be well served to ensure that their environmental, health, and safety programs adequately consider potential environmental justice issues and concerns and are designed in ways that strengthen community and stakeholder relationships, such as by incorporating environmental justice commitments into a company’s environmental, social, and governance (ESG) goals. Below, we outline some recommendations and best practices. 

Keep Abreast of Environmental Justice Developments that May Affect Your Operations

Track environmental justice issues. Not all environmental justice issues will apply to a specific business. However, being aware of national and local developments will allow a company to minimize regulatory, permitting, and community concerns and challenges that may otherwise catch it off-guard, including potential risks of objections to permits and litigation.

Understand your geographical area. By taking steps to better understand the communities in the areas where a company operates or may operate, a company can evaluate risks and make better informed business decisions. For example, companies can take advantage of resources such as USEPA’s EJScreen Mapping Tool, which provides demographic, socioeconomic, and environmental information for chosen geographic areas. Other mapping tools, such as the Council on Environmental Quality’s Climate and Economic Justice Screening Tool and state-specific tools are also available.

Companies with current or future operations in areas with higher percentiles of socioeconomic or environmental quality factors should prepare for the potential legal risks this may pose, including increased government and public scrutiny, and consider how to mitigate potential issues ahead of time. The tools can also be used to aid a company in analyzing health, social, and economic effects of a specific project.

Build a Proactive Environmental Plan

Create an environmental policy or revise an existing one. The rise of corporate accountability has resulted in companies revising their business plans to incorporate ESG criteria into their decision-making. A way to ensure that environmental justice is included in a company’s ESG plan is to make environmental justice part of a company’s social objectives.

In particular, as we discussed in a prior client alert, a company may wish to organize its social criteria objectives so that environmental justice commitments are treated as under the company’s direct control, much like scope 1 greenhouse gas emissions are under the direct control of the company. Companies should also consider developing a public involvement plan as part of their social criteria. Environmental justice can be measured by the amount and quality of direct community engagement and community service. In this way, companies that develop robust engagement plans that further environmental justice objectives of the local community can fold those plans into the social criteria aspects of a greater ESG policy.

Perhaps the most important takeaway is that companies should be cognizant of the interconnectedness of their environmental goals to environmental justice and social/stakeholder concerns. A good environmental justice policy means a good social policy which means a more robust and effective environmental policy and greater chance of meeting environmental objectives.

Develop a robust compliance plan. Enforcement and litigation risk will be higher for companies with operations in communities with environmental justice concerns. Therefore, it is especially important that these companies have robust compliance programs in place. As we previously discussed here, companies can benefit from consistently monitoring their operations and considering the availability of advanced monitoring technologies and methodologies (such as monitoring by aircraft and satellite) that may catch violations and prevent ongoing ones.

Companies should also strictly comply with all applicable monitoring, recordkeeping, and reporting requirements, and consider voluntary disclosure policies. USEPA’s Audit Policy provides several major incentives, including reduction of 100% of gravity-based penalties, for regulated entities to voluntarily discover and fix federal environmental violations. Moreover, the US Department of Justice, Environmental Crimes Section’s Voluntary Self-Disclosure Policy offers beneficial treatment to companies that disclose potentially criminal environmental violations.

Review suppliers and other entities with which the company contracts. In a prior client alert, and as mentioned above, we discussed how a company can define the social aspect of its ESG plan to assist in developing a baseline standard against which a company can measure itself. This includes a company taking steps to establish a standard by which it expects those with which it contracts to behave, reviewing its supply chains to identify any potential areas of inequity against such a standard, and subsequently holding suppliers and other entities with which it transacts accountable, while being particularly mindful of actions that could be tied back to the company.

Use Existing Tools and Resources to Assist in Siting and Permitting Decisions

Be aware of evolving siting and permitting requirements. As discussed above, companies making siting or permitting decisions should consider that projects in or near communities disproportionately burdened by pollution will receive scrutinized attention. Therefore, companies should ensure that environmental justice and civil rights concerns are being proactively evaluated and sufficiently addressed under environmental, civil rights, and environmental justice laws and seek out any available guidance to rectify such concerns. Failure to do so may result in unforeseen project hurdles, wasted resources, and an eventual siting or permit denial. We previously discussed how USEPA incorporates these concerns into the permitting process. Considering recent USEPA guidance on this topic, companies should develop their own best practices for permitting oversight, which should include the following: 

  • Use available screening tools to assess the existence of environmental justice or civil rights concerns early in the permitting process.
  • Perform an appropriately scoped environmental justice analysis or disparate impact analysis (which should consider cumulative impacts) where concerns exist.
  • Know what questions to ask, such as who is being affected by the action? How, and by how much? Compared to whom? Can we mitigate the effects and, if so, how?
  • Develop a public involvement plan and engage communities and tribes to ensure that their views are accounted for (discussed further below).

Failure to take these measures as part of the project scoping process may result in significant hurdles to project development. This includes the possibility of pressure being exerted on state and local regulators to change their course of action with respect to a proposed project. In the Chicago example discussed earlier, the city denied a scrap metal recycling facility’s permit to begin operating an $80 million facility after USEPA issued a letter raising health impact concerns in the surrounding community. The city’s decision, which is currently the subject of a lengthy and ongoing appeal, followed an alleged agreement between the facility operator and city that would have allowed the operator to move to the site.

This also includes active opposition to a project, which may turn into litigation. For example, developer Air Products recently sued Livingston Parish after the parish attempted to restrict the company’s proposed hydrogen/carbon capture and storage project through a moratorium. Ultimately, the parties came to a resolution, whereby the parish agreed that the moratorium was invalid and unenforceable, and the parties agreed that each would bear its own fees and costs related to the litigation.

Review existing permit conditions. Companies with existing facilities that will be applying for permit renewals should be prepared for the possibility of new and more stringent permit obligations being imposed by regulators at the time of their permit renewal. The recently enacted New Jersey environmental justice regulations, for example, set forth a step-by-step process for reviewing future permit applications, including specifically stating that existing permit holders may be subject to additional permit conditions to reduce health and environmental impacts.

More stringent requirements of which companies should be mindful may include, among other obligations: additional monitoring, recordkeeping, and reporting requirements; additional pollution controls and/or more stringent limits; and the inclusion of enforceable work practices, operating plans, and/or best practices for minimizing emissions and/or discharges.

Companies should address environmental justice-related concerns sooner than later, by taking advantage of the existing tools discussed above, to avoid unforeseen complications arising during the permit renewal process. For example, if particulate emissions are a specific concern in your area (e.g., EJScreen shows a particularly high EJ Index percentile for particulate matter 2.5), taking proactive measures to mitigate any increased particulate emissions may streamline the permit renewal process.

Engage the Local Community

Be proactive in engaging the community. Governmental environmental justice policies typically entail expectations of robust engagement with the local community and opportunities for community actors to provide input into company decisions that will affect their communities. Companies may want to similarly engage with the local community prior to taking steps to expand or modify existing operations. This is particularly true for the permitting process; however, companies are well served by engaging with communities and local tribes as a vehicle for making more informed business decisions generally.

This can include learning from a community about a company’s impact, creating strategic partnerships within the community, and collaborating with the community to advance shared goals and establish outcomes that will benefit the community overall. For example, a company can help communities finance environmental justice initiatives or help eligible applicants apply for available grants and help formulate how these community-driven initiatives will take shape.

Being proactive will better prepare a company for what issues, if any, a governmental agency may uncover during its own public engagement process. Ultimately, by strengthening its bond with the local community, companies are better situated to identify community concerns early and take appropriate action that will satisfy both company and community needs while building trust into the future.

Review existing community relationships. The community engagement discussed above should include a review of existing community relationships, specifically where potential environmental justice concerns may not have previously been addressed. To stay on track with such engagement and to ensure the maintenance of strong relationships, making periodic reviews and assessments of existing community relationships could be incorporated into a company’s ESG criteria.

Engage internal stakeholders. Community engagement goes beyond external forces at a specific facility. A company should also cultivate internal discussions with workers, unions, and other stakeholders affected by the company’s actions. Initiatives to consider include informational meetings, listening sessions, and trainings. Environmental health and safety managers should also engage upper management to ensure leadership buy-in for environmental justice initiatives. This guarantees that all levels of the company are aware of and striving towards the same goals.

Conclusion

By embracing environmental justice, companies minimize environmental oversight risks, are likely to achieve environmental goals more quickly, build community relationships, help reduce inequity and ultimately, create a solid foundation for long-term strength, all of which are accretive to an improved bottom line. As federal, state, and local governments continue embedding environmental justice and related initiatives in their regulations, policies, and programs, companies would be well served to do the same. 

Jenner & Block’s Environmental and Workplace Health and Safety and Transitions in Energy and Climate Solutions practice teams are made up of former federal regulatory commissioners, state regulators, regulatory compliance attorneys, and internal counsel and project developers, and are able to help companies achieve environmental justice objectives. Please reach out to a member of one or both of our teams with any questions.

 

 

Department of Justice Secures First Title VI Environmental Justice Resolution Agreement

Daniel BLOG By Daniel L. Robertson, Associate Attorney

On May 4, 2023, the Department of Justice (DOJ) announced a first-of-its-kind Title VI environmental justice interim resolution agreement with the Alabama Department of Public Health (ADPH). The resolution follows an investigation DOJ and the Department of Health and Human Services (DHHS) initiated in November 2021 into whether ADPH violated Title VI of the Civil Rights Act and Section 1557 of the Affordable Care Act. Both laws prohibit discrimination against individuals in programs receiving federal funding. Seal_of_the_United_States_Department_of_Justice.svg

DOJ’s investigation found that ADPH’s enforcement of sanitation laws threatened residents of Lowndes County with criminal penalties and property loss for sanitation conditions they did not have the capacity to alleviate. Median household income in the county is just under $32,000, and 28.3% of county residents live below the poverty line. As of 2022, 80% of residents did not have reliable sewage systems. The process is complicated in part due to the clay soil in the area being incompatible with regular wastewater systems, causing them to often fail. Residents unable to afford specialized systems, estimated to cost between $6,000 and $30,000, have resorted to a system known as “straightpiping” whereby piping systems or ditches are constructed to draw wastewater away from the home. This often results in these wastes being exposed on the property and increasing related healthcare risks caused by exposure to raw sewage. DOJ’s investigation further found that ADPH engaged in a pattern of inaction and/or neglect concerning the health risks associated with raw sewage, and failed to take meaningful action to address the disproportionate burden and impact of these issues on Black residents of Lowndes County. Approximately 72.5% of county residents are Black.

Under the agreement, ADPH agreed to: suspend enforcing sanitation laws against residents who lack the means to purchase functioning septic systems; measure public health risks from raw sewage exposure of different populations; develop a public health awareness campaign regarding raw sewage exposure; create or supplement education materials for Lowndes County health care providers to provide more information on symptoms and illness related to raw sewage exposure; conduct a comprehensive assessment to determine the appropriate septic and wastewater management systems for Lowndes County homes; and create a plan to improve access to adequate sanitation systems. ADPH is also required to consistently engage community residents, government officials, subject matter experts and environmental justice advocates on each aspect of the agreement. DOJ and DHHS in turn have suspended their investigation as long as ADPH complies with the agreement.

One day following its announcement, DOJ released a statement marking the one year anniversary of the establishment of its Office of Environmental Justice, including a fact sheet of department accomplishments from the prior year. The Office’s actions include supporting the DOJ’s lawsuit to improve safe drinking water access in Jackson, Mississippi, training DOJ attorneys on environmental justice best practices, and developing community-outreach best practices for DOJ departments nationwide. DOJ also highlighted an ongoing investigation into potential discriminatory practices by the city of Houston in how it responds to illegal dumping.

Thursday’s move reinforces the federal government’s emphasis on advancing environmental justice initiatives, following President Biden’s recent Executive Order on Revitalizing Our Nation’s Commitment to Environmental Justice For All. As we discussed in a recent client alert, companies should evaluate and instill best practices to navigate this evolving landscape. We will continue to monitor environmental justice developments on the Corporate Environmental Lawyer.


New York Becomes First State to Pass Natural Gas Ban for New Construction

Daniel BLOG  AllyssaMilam  By Daniel L. Robertson and Allyssa Milam

On May 2, 2023, New York passed its 2024 fiscal year budget, including a prohibition on fossil fuel equipment and building systems in new construction. The policy will go into effect in 2026 for new buildings not more than seven stories tall, except for new commercial or industrial buildings greater than one hundred thousand square feet, and in 2029 for all new Download  buildings.

The ban will not apply to buildings in existence prior to the effective dates. Even after the effective dates, existing buildings will remain unimpacted by the ban in the course of repairs, alterations, additions, relocations, and changes to the occupancy or use of such buildings. Further, existing buildings may install and continue to use and maintain fossil fuel equipment and building systems.  

The budget includes exemptions for buildings ranging from hospitals to car washes, keeping some buildings on gas beyond the 2029 deadline. Specifically, fossil fuel equipment may be installed and natural gas may be used:

  • for generation of emergency back-up power and standby power systems;
  • in manufactured (e., mobile) homes; and
  • in a building or part of a building that is used as a manufacturing facility, commercial food establishment, laboratory, car wash, laundromat, hospital or other medical facility, and in other critical infrastructure such as emergency management facilities, wastewater treatment facilities, water treatment and pumping facilities, agricultural buildings, fuel cell systems, and crematoriums.

To curb the use of natural gas in buildings with exemptions, the budget includes additional guardrails. Some buildings will be required to, “to the fullest extent feasible,” limit the use of fossil fuel combusting systems. Further, qualifying exempted buildings will be required to be electrification ready in the areas where the building was permitted to install fossil fuel systems. The budget also expressly states that financial restraints are an insufficient basis on which to determine the feasibility of such requirements.

The budget states that standards for building construction shall be designed to achieve the state’s clean energy and climate agenda as set forth in New York’s Climate Leadership and Community Protection Act (“Climate Act”), signed into law in July of 2019. The Climate Act is part of New York’s ambitious climate strategy to reduce greenhouse gas emissions 40% by 2030 and 85% by 2050 from 1990 levels.

New York becomes the first state to enact this type of emissions prohibition, joining cities and municipalities across the nation with similar prohibitions including San Francisco, Los Angeles, Denver, and Montgomery County, Maryland. By contrast, legal challenges to these policies and the significant number of states passing laws prohibiting cities from banning natural gas means that the nationwide trajectory of natural gas bans and emissions regulations remains undetermined. We will continue to monitor these developments on the Corporate Environmental Lawyer.


Biden Administration Underscores Environmental Justice Commitment with Earth Week Executive Order

 

 Daniel BLOG By Daniel L. Robertson, Associate Attorney

White House - BLOGCapping off Earth Week 2023, President Biden on Friday signed an executive order expanding the Administration’s Justice40 Initiative and creating a new White House Office of Environmental Justice.

The Executive Order, titled Revitalizing Our Nation’s Commitment to Environmental Justice for All, expands and provides additional clarity to the Biden Administration’s environmental justice commitment. According to a White House fact sheet distributed on Friday, the order is intended “to ensure that all people – regardless of race, background, income, ability, Tribal affiliation, or zip code – can benefit from the vital safeguards enshrined in our nation’s foundational environmental and civil rights laws.” The order addresses this commitment through various means:

  • Embedding the Administration’s “Whole of Government” approach to Environmental Justice.

The Order makes clear that the pursuit of environmental justice should be incorporated into the missions of all executive branch agencies. It also adds agencies to the White House Environmental Justice Interagency Council, a body tasked in part with developing federal agency performance metrics and publishing an annual public performance scorecard (more on that below).

Notably, the Order directs agencies to consider measures that will address and prevent “disproportionate and adverse” impacts on health and the environment, contrasting the prior “disproportionately high and adverse” requirement established by Executive Order 12898 signed by President Clinton on February 11, 1994. The Administration describes this change as “eliminat[ing] potential misunderstanding that agencies should only be considering large disproportionate effects” which will likely lead to increased federal agency scrutiny as projects under their purview meet this lower threshold.

  • Enhancing Community Engagement.

The Order requires federal agencies to notify nearby communities in the event of a release of toxic substances from a federal facility. This notification includes holding a public hearing to share information on any resulting health risks or necessary precautions. The Order also directs federal agencies to “actively facilitate meaningful public participation and just treatment of all people in agency decision-making.” This includes Tribal consultation and strengthening nation-to-nation relationships on environmental justice issues.

Federal agencies are also required to submit to the White House Council on Environmental Quality and make available to the public an Environmental Justice Strategic Plan. Agencies will use the plan to set forth goals and actions to advance environmental justice, and identify oversight opportunities to improve accountability and compliance with any statute administered by that agency that affects communities with environmental justice concerns. The Order requires that this plan be submitted no later than 18 months after the date of the Order, and every 4 years thereafter.

  • Launching a new White House Office of Environmental Justice.

The new Office of Environmental Justice will be located within the White House Council on Environmental Quality and be led by the Federal Chief Environmental Justice Officer. The office will be tasked with coordinating the implementation of environmental justice policies across federal government agencies.

  • Creating a new Environmental Justice Subcommittee within the National Science and Technology Council.

This new subcommittee, led by the Office of Science and Technology Policy, will be tasked with coordinating a strategy for federal agencies to identify and fill gaps in data and research relating to environmental justice in part to aid in advancing cumulative impact analyses. Filling in these data gaps will allow agencies to use science to better address adverse health and environmental impacts. The Committee will be required to update this Environmental Justice Science, Data, and Research Plan every two years.

  • Publication of the Inaugural Federal Agency Environmental Justice Scorecard and Draft National Strategy on Preventing Plastic Pollution.

While not part of the Executive Order, the White House unveiled a first-of-its-kind environmental justice scorecard for federal agencies. Developed by the Office of Management and Budget, the Council on Environmental Quality, and the United States Digital Service, the scorecard assesses 24 federal agencies’ environmental justice advancement efforts, including efforts to advance the Administration’s Justice40 initiative. This initiative is designed to ensure that 40 percent of federal funding investments flow to communities that are marginalized, underserved, and overburdened by pollution. Similarly, Friday’s announcement referenced the addition of the Department of Commerce, the National Science Foundation, and the National Aeronautics and Space Administration programs to the Justice40 initiative, bringing the total number of programs covered by the initiative to 470 across 19 federal agencies.

The White House also announced a new Interagency Policy Committee on Plastic Pollution and a Circular Economy, alongside a draft National Strategy on Preventing Plastic Pollution released the same day by the U.S. EPA. The draft strategy plan is intended to address disparate impacts on communities affected by plastic from production to waste. The Committee, meanwhile, will coordinate federal efforts addressing plastic pollution to ensure an equitable distribution of the benefit from these efforts.

In a time when the Biden Administration faces increased scrutiny regarding its environmental efforts, the White House’s announcement also highlights various actions undertaken by executive agencies during the current presidential term. Friday’s action marks the latest installment in the Biden Administration’s advancement of environmental justice initiatives, following Executive Order 13990 signed on President Biden’s first day in office, and Executive Order 14008 signed soon thereafter on January 27, 2021. The White House states that Friday’s Order reflects the goals and recommendations of the White House Environmental Justice Advisory Council, demonstrating the active approach that council continues to take in this area. The Order underscores the Administration’s commitment to developing environmental justice initiatives at the federal level, entrenching those initiatives into the goals of executive agencies, and providing transparency to the public on how those goals are being achieved.

We will continue to monitor this and other federal environmental justice developments on the Corporate Environmental Lawyer.


Earth Day 2023--Investing in a Balanced Approach to Emerging Contaminants

Daniel BLOG

By:  Daniel L. Robertson, Associate Attorney

 

 

Earth Week Blog Image2023

In the 1962 book, Silent Spring, Rachel Carson brought to the forefront of public attention contaminants of emerging concern (CECs). CECs, or emerging contaminants, are chemicals or materials that can be characterized by a perceived, potential or real threat to human health or the  environment. These threats typically “emerge” as advances in scientific technologies reveal previously unknown adverse effects of a specific chemical  that may already be ubiquitous in the environment. Examples in recent years include 1,4 dioxane, polychlorinated biphenyls (PCBs), ethylene oxide, and per- and polyfluorinated substances (PFAS). Pharmaceuticals and nanomaterials are increasingly being considered as areas of concern that may require further scrutiny in future.

Often by the time adverse impacts are identified, the contaminant is in widespread use. PCBs, for example, were prevalent in coolants and lubricants in a variety of electrical equipment because PCBs are very effective insulators. PFAS were heralded as revolutionary for their effective fire-fighting and coating characteristics and currently are in a multitude of everyday products ranging from food packaging to the clothes we wear.

As we gain a better understanding of the potential effects of these chemicals, regulators face challenges in promulgating appropriate regulations for these CECs. Meanwhile, companies seemingly acting in full compliance with permits and regulatory requirements find themselves targeted by lawsuits seeking to compel remediation of impacted sites and product reformulation. Long dormant sites previously considered remediated may be reopened and additional clean-up required as, for example, may result as a result of U.S. EPA’s pending proposals to designate certain PFAS as hazardous substances under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA).

As history has shown, and due to ongoing technological advancements, new emerging contaminants will continue to be identified and the process of evaluating potential health and environmental risks will begin anew. There is an ongoing debate as to whether the approach employed by the Toxic Substances and Control Act (TSCA) is the most effective approach to regulating CECs, when contrasted for example with the approach taken by the European Union’s Registration, Evaluation, Authorization, and Restriction of Chemicals (REACH).  While both programs are designed to protect human health and the environment through restricting the use of harmful substances, they accomplish this through different means. TSCA requires reporting oversight of a chemical where U.S. EPA demonstrates an unreasonable risk. REACH, on the other hand, obligates manufacturers and importers to register and demonstrate the safe control of a chemical prior to that chemical being placed into the market.

As applied to PFAS, in the United States, U.S. EPA seeks to regulate specific PFAS through a variety of avenues. In August 2022, U.S. EPA proposed designating two PFAS substances as CERCLA hazardous substances, and in April 2023 proposed additional PFAS substance designations. In March 2023, U.S. EPA simultaneously proposed maximum contaminant levels (MCLs) setting drinking water limits for two PFAS compounds and proposed to regulate four additional PFAS through a Hazard Index screening approach that will require site-specific determinations for drinking water concentration. Pursuant to the 2019 PFAS Act, 176 PFAS substances have been added to the Toxic Release Inventory (TRI) chemical database, creating additional reporting liabilities for impacted companies. However, in December 2022, U.S. EPA proposed reclassifying all TRI-listed PFAS to the Chemicals of Special Concern list, which would further increase reporting scrutiny on regulated companies. Each of these practices takes significant resources to implement, and with 10,000 PFAS already identified, could create a significant investment over time.

Contrast this approach with the approach of the European Chemicals Agency (ECHA) that in February proposed a blanket restriction of all 10,000 PFAS substances in the European Union. This itself creates uncertainty for companies where no commonly accepted testing methods exist whereby companies can test for all of these compounds. The approach further restricts PFAS chemicals for which studies on their adverse impacts may not yet exist. It is expected that ECHA will receive a substantial number of comments on its proposal, much like U.S. EPA has received on its proposals discussed above.

While there may not be a single “right” way to address CECs, the risks posed by emerging contaminants will continue to challenge both the regulators and the regulated community to find the appropriate regulatory balance between protection of human health and the environment and the need to continue to manufacture products that we rely upon daily. As demonstrated by the 2016 Lautenberg amendments to TSCA, stakeholders on all sides appear invested to continue striving towards this balance.  

Maine Proposed Rule Provides Further Reporting Clarity for Products and Product Components Containing PFAS

   SirosRobertson  Daniel By Steven Siros, Partner and Daniel L. Robertson, Associate Attorney

On February 14, 2023, the Maine Department of Environmental Protection (MDEP) issued a proposed draft rule that provides guidance on reporting requirements and sales prohibitions for products and product components containing intentionally added Per- and Polyfluoroalkyl substances (PFAS). PFAS BLOG This proposed rule comes on the heels of two prior MDEP concept drafts and public hearings attended by hundreds of interested parties that generated a significant number of substantive comments.

In July 2021, the Maine Legislature enacted An Act to Stop Perfluoroalkyl and Polyfluoroalkyl Substances Pollution. The law sets forth three main objectives: (1) banning the sale of any product containing intentionally added PFAS by January 1, 2030; (2) banning the sale of carpets, rugs, and fabric treatments with intentionally added PFAS beginning on January 1, 2023; and (3) creating reporting requirements for manufacturers of products with intentionally added PFAS, also beginning on January 1, 2023.  In the absence of implementing regulations as of the January 1, 2023 effective date of the law, MDEP granted compliance extensions to hundreds of manufacturers, following the Maine State Chamber of Commerce actively encouraging Maine businesses to seek extensions.

MDEP’s latest draft rule clarifies a number of issues, including providing guidance on which PFAS chemicals must be reported, conditions for seeking waivers or exemptions from the reporting requirements, submitting claims for confidential business information, and certain fee requirements.

With regards to reporting, the draft rule specifies that the notification must include:

  1. a) A brief description of the product;
  2. b) The purpose for which PFAS are used in the product, including any product component;
  3. c) The amount of each PFAS as a concentration, identified by name and its chemical abstract service (CAS) registry number, of each PFAS in the product or any product component reported as an exact quantity determined using commercially available analytical methods, or as falling within a range approved by MDEP; and
  4. d) The name and address of the reporting manufacturer and information identifying a responsible officer for the manufacturer.

MDEP notes that because the statute requires notification of intentionally added PFAS by CAS number, chemicals which do not have a CAS number assigned are not subject to the reporting requirements or use prohibitions. The latest draft also removes a prior proposed requirement that manufacturers report estimated sales volume for the product. In defining a manufacturer, the proposal clarifies that, in the event a product contains more than one manufacturer, MDEP “will consider the party who controls the formulation of the product and its PFAS content to be the manufacturer.”

The proposal further provides language on waiver requirements and preemption. MDEP may waive all or part of the notification requirement if MDEP determines that “substantially equivalent information” is publicly available. “Substantially equivalent information” is defined in part as “an existing notification by a person who manufactures a product or product component when the same product or product component is offered for sale under multiple brands.”

A product for which federal law or regulation controls the presence of PFAS in the product is exempt from the proposed requirements. Federal preemption is described as “a determination that the intent of federal laws is to limit or eliminate overlapping programs at the state level.” MDEP “will treat as exempt products where an applicable federal law is written with language that explicitly preempts parts of this program . . . [or] any products where an applicable opinion from a court having jurisdiction in Maine finds that preemption of parts of this program is implied.” There are also exemptions for products subject to Maine Revised Statutes Title 32, Sections 26-A (Reduction of Toxics in Packaging) and 26-B (Toxic Chemicals in Food Packaging). This state exemption specifically applies to items being used as packaging, packing components, or food packing and intended for marketing, handling or protection of products.

MDEP also revised its rules for reporting confidential business information, with the latest draft stating that claims of confidential business information may be made at the time of notification. MDEP will handle these claims in accordance with Maine’s Freedom of Access Act, Maine Revised Statutes and related policies and procedures. The proposal notes in particular that information courts would find to be privileged is excluded from public disclosure.

Finally, the proposed rule clarifies the requirements on product components, noting that “[a] separate notification and fee are only required for product components when they are offered or distributed in Maine without being incorporated into a more complex product.”

The draft rule fails, however, to clarify what if any obligation is imposed on a manufacturer that unknowingly sells or distributes for sale a product that contains “intentionally added PFAS.”   For example, a manufacturer may use an ingredient or component that itself contains “intentionally added PFAS” but the manufacturer may lack “knowledge” of the presence of the PFAS in the ingredient or component.  Moreover, because even the best laboratories can detect only a few of the more than 9,000 different PFAS, it is often impossible for a manufacturer to know whether a product sold or distributed in Maine contains “intentionally added PFAS”.  The regulations are silent on what, if any, compliance obligations may be triggered by what is a fairly common occurrence. 

Manufacturers of products sold in Maine that may contain PFAS would be well served to carefully evaluate this proposed rule to determine how best to ensure compliance with the January 1, 2023 reporting obligations and subsequent sale prohibitions.   Affected entities may elect to submit comments on the proposed rule on an individual basis or through a trade association.  The public comment period closes on May 19, 2023.

We will continue to monitor Maine’s PFAS reporting rulemaking and other nationwide PFAS-reporting developments on Corporate Environmental Lawyer.


PFAS in Consumer Products


Siros Robertson  Daniel Feltman-Frank

 

By Steven Siros, Daniel L. Robertson and Arie Feltman-Frank

 

Developing a Proactive and Strategic Game Plan

Per- and polyfluoroalkyl substances (PFAS) in consumer products continue to be in the regulatory and litigation spotlight in 2023. Manufacturers and downstream businesses should be actively preparing to comply with the continually evolving patchwork of federal and state PFAS laws, as well as taking steps to minimize litigation risks. Below, our team of attorneys offers strategic advice for manufacturers and downstream businesses with respect to how regulatory and litigation PFAS developments may apply to them and best practices for minimizing regulatory and litigation risk with respect to same.

I.     State Consumer Product PFAS Laws PFAS

Consumer products that are currently the subject of state PFAS laws include carpets, rugs, and fabric treatments, children’s products, cookware, cosmetics, food packaging, furniture, oil and gas products, ski wax, and textiles and apparel, but this is a continually evolving list. Businesses that manufacture and sell these and similar products should be carefully evaluating whether these products contain PFAS, in which states the products are or will be manufactured, distributed, or sold, and what the PFAS laws and regulations are in those states. State PFAS laws can be categorized by the PFAS they regulate, the requirements they impose, and other notable nuances.

  1. Regulated PFAS

Thousands of PFAS have been identified by the U.S. Environmental Protection Agency (EPA),[1] but PFAS laws may not apply to all. Thus, when reviewing their applicability, businesses should consider how PFAS laws define PFAS and whether they apply broadly to all PFAS or only a specific subset of PFAS. Businesses should also consider whether there are specific threshold concentrations or whether the regulations are triggered by the presence of any PFAS in the product. Lastly, businesses should consider whether the laws only apply to “intentionally” added or introduced PFAS that serve an intended function. Each of these are discussed, in turn, below.

            A.    PFAS Defined and Specific Subsets

State PFAS laws generally broadly define PFAS as a class of fluorinated organic chemicals containing at least one fully fluorinated carbon atom.[2] Some laws apply to PFAS generally. For example, California’s Chemicals of Concern in Food Packaging, Juvenile Products, and Textile Articles laws prohibit “regulated” PFAS, and their definitions of “regulated” do not narrow their prohibitions’ coverage to a specific PFAS subset.

In contrast, other laws only apply to a specific subset of PFAS. These narrower laws may identify the regulated PFAS themselves or refer to chemicals designated or listed by a state regulatory agency. For example, Maryland’s Cosmetic Products law specifically lists thirteen specific PFAS that fall within its regulatory purview. Similarly, Maine’s Toxic Chemicals in Children’s Products law applies to “priority chemicals,” and perfluorooctanesulfonic acid (PFOS) is the only PFAS that the Maine Department of Environmental Protection has currently designated as such. Importantly, PFAS chemicals that are not subject to prohibitions now may fall victim in the future. Thus, businesses that choose to continue using unregulated PFAS in their products may find themselves forced to adjust their ingredient lists down the road.

            B.    Threshold Concentrations

In addition to identifying the regulated PFAS, businesses should consider whether state PFAS laws specify threshold concentrations that trigger their requirements as these may influence compliance obligations.

For example, Oregon’s Toxic-Free Kids Act imposes disclosure requirements on manufacturers of children’s products that contain a high priority chemical.

but only if the chemical is “in an amount at or above a de minimis level.” For an intentionally added chemical, the de minimis level is the “practical quantification limit” (PQL), which means the lowest concentration of a chemical that can be reliably measured within specified limits during routine laboratory operating conditions. The Oregon Health Authority has defined the PQL for intentionally added PFOS as 0.001 parts per million. For a chemical that is a “contaminant,” which is defined as trace amounts of chemicals that are incidental to manufacturing and that serve no intended function in the product component, the de minimis level is 100 parts per million (see more on unintentional PFAS below).

In a similar fashion, Maine’s An Act to Stop PFAS Pollution imposes disclosure requirements on manufacturers of products with intentionally added PFAS. However, the Maine Department of Environmental Protection has suggested in its FAQs[3] that notification is only required if intentionally added PFAS are detectable when analyzing the product using a commercially available analytical method (above the PQL). The Department understands “commercially available analytical method” to mean any test methodology used by a laboratory that performs analyses or tests for third parties to determine the concentration of PFAS present. 

Finally, California’s Chemicals of Concern in Food Packaging and Juvenile Products laws, which prohibit “regulated” PFAS, specify that PFAS may be considered “regulated” if their presence is at or above 100 parts per million, as measured in total organic fluorine. California’s Textile Articles law provides a similar threshold concentration requirement, as does Vermont’s Chemicals of High Concern to Children law.

Thus, compliance with state PFAS laws may require that businesses be able to reliably measure the concentration of PFAS (or total organic fluorine) in their final products, which will depend on the availability of commercially available testing methods. While EPA has developed approved methods for measuring PFAS concentrations in environmental matrices such as air, water, waste, and pesticides, these methods may not be specifically applicable for consumer products. Notably, the American Society for Testing and Materials (ASTM) has announced that it created a new subcommittee that will develop standards for measuring PFAS in consumer products. ASTM’s efforts are ongoing.

Importantly, limitations in measuring capabilities may pose unique compliance challenges.[4] The traditional PFAS testing methods are liquid chromatography-tandem mass spectrometry (LC/MS/MS) or gas chromatography-mass spectrometry (GC-MS), but these methods target only a specific subset of PFAS—presently approximately 42 unique PFAS.

To address these limitations, there are numerous emerging technologies and methodologies. For example, to evaluate the presence of precursor molecules that can break down or transform into PFAS, total oxidizable precursors (TOPs) assay can be utilized as it was in a recent study to measure the presence of PFAS in a range of household items.[5] Other methodologies such as combustion ion chromatography (CIC), particle-induced gamma ray emission (PIGE), neutron activation analysis (INAA), and X-ray photoelectron spectroscopy (XPS), can be used to quantify total organic fluorine that some state regulators have elected to rely upon as a proxy for PFAS.[6] There are, however, significant risks in relying on total organic fluorine as a proxy for PFAS as numerous studies have documented limitations in this methodology.[7]

Businesses should be reviewing commercially available methods to measure the concentration of PFAS in their products, as well as be cognizant as to how these methods are evolving. Businesses may also want to consider seeking clarification from regulatory agencies on which methods are appropriate for specific consumer products. 

            C.    Intentionality and Functionality

Many state PFAS laws only apply when PFAS are “intentionally” added or introduced to covered products for a specific purpose.[8] Notably, the introduction or addition of PFAS does not need to be direct. Intentionally adding or introducing product ingredients that are not regulated PFAS but break down or transform into PFAS in final products may render state PFAS laws applicable, too. Therefore, businesses should assess whether PFAS (or other chemicals that may serve as precursor molecules of regulated PFAS) are being used in their manufacturing process and for what purpose. Businesses that use PFAS or PFAS precursor product ingredients in their manufacturing process for a specific purpose should evaluate the extent to which they can phase out these ingredients and find substitutes.   

Some laws specifically exempt unintentional PFAS from regulation. For example, Connecticut’s Cosmetic Products law clarifies that a person is not in violation of the law’s PFAS prohibition if the product was manufactured through a process to comply with the law and contains a technically unavoidable trace quantity of regulated PFAS due to an impurity of a natural or synthetic ingredient, the manufacturing process, storage, or packaging.

However, other laws may not let manufacturers off the hook if the unintentional PFAS is above identified threshold concentrations. As discussed above, California’s Chemicals of Concern in Food Packaging, Juvenile Products, and Textile Articles laws and Vermont’s Chemicals of High Concern to Children law establish threshold concentration requirements.

Even if PFAS are not being used to manufacture the product itself, they may still end up in the final product. One way this may happen is through leaching from the product packaging. For example, EPA studies have revealed that PFAS from fluorinated high-density polyethylene (HDPE) container walls of pesticide products can leach into the contents of the containers. In fact, EPA has recently initiated enforcement action against a company that utilized fluorine gas in the manufacture of plastic containers from which EPA claims PFAS are leaching into the products stored in these containers. 

In sum, even if businesses do not use PFAS in their manufacturing process, they would be wise to carefully audit their supply chains to minimize the risk of PFAS winding up in their final products. Moreover, as explained further below, businesses with PFAS in their products, even if their presence is unintentional and not in violation of any specific federal or state regulation, may still be subject to private party litigation.

Finally, although not the primary focus of this client alert, businesses should consider the downstream pathways of their products and other equipment that may contain PFAS because releases into the environment may trigger Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) reporting requirements and liability once perfluorooctanoic acid (PFOA) and PFOS (and other PFAS down the road) become designated as CERCLA hazardous substances (see more on remediation demands below).[9]

  1. Requirements

Requirements fall into two categories: disclosures and prohibitions. While some state PFAS laws directly impose requirements, others give regulatory agencies the authority to. Below is a collection of consumer product categories and state PFAS laws, including the types of requirements imposed and their effective dates.

While some laws are already in effect, others will take effect later this year. For example, Vermont’s prohibitions on intentionally added PFAS in carpets and rugs, food packaging, and ski wax, and California’s prohibition on regulated PFAS in children’s products, will take effect on July 1 of this year. Connecticut’s and New York’s prohibition on intentionally added PFAS in food packaging and apparel, respectively, will take effect on December 31. Other laws won’t take effect until 2024 or beyond.

 

State PFAS Laws/Regulations Targeting Consumer Products

Product Category

States, Type of Requirement, Effective Date

Carpets/Rugs/Fabric Treatments

·         California: Disclosure (effective).

·         Maine: Prohibition (effective).

·         Maryland: Prohibition (effective).

·         Vermont: Prohibition (July 1, 2023).

·         Colorado: Prohibition (Jan. 1, 2024).

Children’s Products

·         Oregon: Disclosure/eventual prohibition (effective). 

·         Maine: Disclosure (effective).

·         Vermont: Disclosure (effective); potential prohibition: businesses should closely follow regulatory developments (see here).  

·         Washington: Disclosure (effective).

·         California: Prohibition (July 1, 2023).

·         Colorado: Prohibition (Jan. 1, 2024).

·         New York: Potential disclosure/eventual prohibition if PFAS are added to Dangerous Chemicals List. Businesses should closely follow regulatory developments (see here).

Cookware

·         California: Disclosure on website (effective); disclosure on label (Jan. 1, 2024).  

·         Colorado: Disclosure (Jan. 1, 2024).

Cosmetics

·         California: Prohibition (Jan. 1, 2025).

·         Colorado: Prohibition (Jan. 1, 2025).

·         Maryland: Prohibition (Jan. 1, 2025).

Food Packaging

·         California: Prohibition (effective).

·         Maryland: Prohibition (effective).

·         New York: Prohibition (effective).

·         Washington: Prohibition (effective).

·         Vermont: Prohibition (July 1, 2023).

·         Connecticut: Prohibition (Dec. 31, 2023).

·         Colorado: Prohibition (Jan. 1, 2024).

·         Minnesota: Prohibition (Jan. 1, 2024). 

·         Rhode Island: Prohibition (Jan. 1, 2024).

·         Hawaii: Prohibition (Dec. 31, 2024).

·         Maine: Potential prohibition if Maine Department of Environmental Protection does so by rule. Businesses should closely follow regulatory developments (see here).

Furniture

·         Colorado: Prohibition for indoor upholstered furniture (Jan. 1, 2025); prohibition for outdoor upholstered furniture (Jan. 1. 2027).

Oil and Gas Products

·         Colorado: Prohibition (Jan. 1, 2024).

Ski Wax

·         Vermont: Prohibition (July 1, 2023). 

Textiles/Apparel

·         New York: Prohibition (Dec. 31, 2023).

·         California: Prohibition (Jan. 1, 2025); disclosure for outdoor apparel for severe wet conditions (Jan. 1, 2025); prohibition for outdoor apparel for severe wet conditions (Jan. 1, 2028).

·         Colorado: Prohibition for indoor textile furnishings (Jan. 1, 2025); prohibition for outdoor textile furnishings (Jan. 1, 2027).

General

·         California: Disclosure (effective).

·         Maine: Disclosure (effective); prohibition (Jan. 1, 2030); in the interim, potential prohibition if Maine Department of Environmental Protection does so by rule. Businesses should closely follow regulatory developments (see here).

·         Washington: Potential disclosure and/or prohibition if the Washington Department of Ecology does so by rule. Businesses should closely follow regulatory developments (see here).

  1. Other Notable Nuances

Finally, state PFAS laws can be characterized by other notable nuances. For example, some laws provide defenses for sellers and distributors that rely in good faith on manufacturer certificates of compliance. Others provide exemptions for certain products or parties or provide a vehicle for regulatory agencies to extend deadlines. Businesses should carefully consider these nuances when evaluating their options.

II.     Federal Consumer Product PFAS Regulations, Bills, and Liability

In addition to preparing to comply with the patchwork of state PFAS laws, businesses should be following and preparing to comply with evolving PFAS obligations at the federal level and seeking to understand and address potential liabilities. These include:

  • Reporting obligations under Section 313 of the Emergency Planning and Community Right-to-Know Act for facilities that manufacture, process, or otherwise use certain PFAS that have been added to the Toxic Release Inventory. Notably, if EPA’s December 5, 2022, proposed rule[10] takes effect, covered facilities will no longer be able to avoid PFAS reporting obligations under the “de minimis exemption,” which allows facilities to evade reporting requirements with respect to mixtures or other trade name products containing PFOS concentrations below 0.1% and other covered PFAS concentrations below 1%. Covered facilities will also no longer be able to take advantage of other burden-reduction reporting options. Businesses should consider submitting comments on the proposed rule, which must be received on or before February 3, 2023.
  • Notification requirements associated with importing articles and carpets containing certain PFAS. Specifically, EPA’s Significant New Use Rule,[11] promulgated under the Section 5(a) of the Toxic Substances Control Act (TSCA), became effective on September 25, 2020, and requires persons to notify EPA at least 90 days before commencing the import of a subset of PFAS chemicals as part of a surface coating on articles and PFOS as part of carpets. The rule provides that examples of articles could include apparel, outdoor equipment, automotive parts, carpets, furniture, and electronic components.
  • Potential future reporting and recordkeeping requirements for manufacturers and importers of PFAS for PFAS manufactured in any year since January 1, 2011. Under EPA’s proposed rule,[12] proposed pursuant to Section 8(a)(7) of TSCA, articles containing PFAS, including imported articles containing PFAS (such as articles containing PFAS as part of surface coatings), are included in the scope of reportable chemical substances.
  • Potential future testing and reporting obligations for manufacturers or processors of certain PFAS that may be on the receiving end of TSCA Section 4(a) testing orders. Under TSCA, the term “processor” includes persons who prepare chemical substances for distribution in commerce as part of articles.[13] These orders require recipients to test identified chemical substances to determine whether they have adverse health or environmental effects.
  • Keep Food Containers Safe from PFAS Act of 2021 (3169): This bill was introduced in the U.S. Senate on November 4, 2021, and would amend the Federal Food, Drug, and Cosmetic Act to, effective January 1, 2024, prohibit the introduction or delivery for introduction into interstate commerce of food packaging containing intentionally added PFAS, and for other purposes. The bill’s sponsor is U.S. Senator Margaret Wood Hassan of New Hampshire.
  • No PFAS in Cosmetics Act (2047): This bill was introduced in the U.S. Senate on June 14, 2021, and would require the Secretary of Health and Human Services to issue a proposed rule to ban the use of intentionally added PFAS in cosmetics no later than 270 days after the bill’s enactment and finalize such rule not later than 90 days after issuing the proposed rule. The bill’s sponsor is U.S. Senator Susan M. Collins of Maine.
  • Safe Drinking Water Act (and state) regulatory developments and remediation demands: EPA is developing a National Primary Drinking Water Regulation (NPDWR) for PFOA and PFOS, which will lead to the establishment of Maximum Contaminant Levels (MCLs) for these PFAS.[14] In the interim, EPA has developed[15] non-regulatory health advisory levels for PFOA and PFOS, as well as final health advisory levels for other PFAS. EPA is also evaluating additional PFAS and considering regulatory actions to address groups of PFAS. For example, EPA’s Fifth Contaminant Candidate List[16] includes a group of PFAS, which may lead to a NPDWR for these PFAS down the road. Also, the Fifth Unregulated Contaminant Monitoring Rule[17] requires certain public water systems to collect samples of 29 PFAS between 2023 and 2025. Notably, in addition to these federal developments, several states have established MCLs and notification requirements for certain PFAS. To comply with these regulatory developments, public water systems may detect and remediate PFAS in drinking water and target nearby consumer product manufacturers or downstream businesses with PFAS in their products to try to force them to pay remediation costs.

III.    Litigation

Finally, businesses should proactively stay ahead of new PFAS litigation trends in the consumer product context.

  1. Current Litigation

As consumer interest in PFAS increases, there is a corresponding increased focus on reporting of PFAS in consumer products. Perhaps not surprisingly, this reporting has spawned litigation.

For example, after a 2022 Consumer Reports review discussed PFAS in packaging products from restaurants and grocery chains, companies named in the report, including Burger King, were sued. In a similar fashion, after Toxic-Free Future published a report on the use of PFAS in water or stain-resistant textiles, one of the companies in the report, Recreational Equipment, Inc. (REI), was sued in California in April 2022, with a second lawsuit filed in Washington in October 2022. Personal care brands and cosmetic manufacturers such as L’Oreal and Cover Girl are facing similar lawsuits, the L’Oreal lawsuit citing a June 2021 Notre Dame research study that investigated the use of PFAS in 231 cosmetic products.

The lawsuits generally allege breaches of express or implied warranties, fraudulent concealment, unjust enrichment, and consumer protection act violations and track similar themes, targeting a business for touting its product as “sustainable,” “safe,” or “green” when the product allegedly contains PFAS known to be harmful. Statements of “transparency” in product ingredients have also been targeted where the use of PFAS was not clearly stated. Unjust enrichment claims tend to allege a company saved money by using PFAS-coated products instead of more expensive, but safer, alternatives. Injury claims, such as in the REI cases, allege that a consumer was led to believe they were spending money on a premium, environmentally friendly brand versus lower-cost competitors.

At least one lawsuit has already been defeated. For example, on November 30, 2022, a district court in Pennsylvania dismissed a lawsuit against Artsana USA, Inc., commonly known as Chicco, that alleged a failure by Chicco to disclose the use of PFAS in its KeyFit 30 children’s car seat in either its packaging, labelling, or ingredients list. The plaintiff, who did not allege any health impacts, instead alleged that she overpaid for the product thinking it was PFAS-free based on Chicco’s omissions and misrepresentations. The plaintiff also pointed to a Chemical Policy on Chicco’s website that claimed the KeyFit 30 to be PFAS-free.

On a motion to dismiss, the court held that the plaintiff did allege an injury-in-fact by paying a price premium for a product the plaintiff believed to be PFAS-free. However, the court also held that the plaintiff failed to state a claim for which relief could be granted because Chicco is not required to disclose the chemicals it uses to treat its car seats and because the plaintiff did not rely on the Chemical Policy when purchasing the car seat. The court further held that the plaintiff failed to follow statutory requirements to notify the defendant of a breach of express or implied warranty.

Other consumer product company defendants have similarly pushed to dismiss litigationThe disposition of these and related lawsuits will bring needed clarity to businesses with respect to how they advertise their products.

  1. Future Outlook

It is likely that plaintiff’s firms will continue to aggressively pursue lawsuits in this area. With most lawsuits focusing on product representations, businesses should pay special attention to how they address PFAS in their consumer-facing descriptions.

Retailers can also expect increased pressure from consumers to remove PFAS-containing products from their catalogs. This, in turn, will put pressure on manufacturers and upstream suppliers to ensure products reaching retail are PFAS-free, as well as increase retailer and consumer demands directed at manufacturers and suppliers for product ingredient information.

IV.    Conclusion

Manufacturers and downstream businesses should be dedicating resources to comply with regulatory developments and minimize litigation risk. Our team of attorneys can help businesses examine how PFAS developments apply to them, as well as help businesses develop a proactive and strategic game plan.

 

[1] See PFAS Master List of PFAS Substances, EPA (Aug. 10, 2021), https://comptox.epa.gov/dashboard/chemical-lists/pfasmaster.

[2] Sometimes state PFAS laws use the language “all” or “any” members.

[3] While the disclosure requirements took effect January 1, 2023, the Maine Department of Environmental Protection is currently in the process of developing regulations. The Department’s website notes that the answers in its FAQs are subject to change in response to feedback and changes in regulation.

[4] Cf. Kelsey L. Rodriguez et al., Recent Developments of PFAS-Detecting Sensors and Future Direction: A Review, Micromachines (Basel). 2020 Jul; 11(7): 667, at 2 (noting the limitations in the practical applications of traditional technologies used to measure PFAS in environmental matrices). For one example of regulatory-detection  mismatch in the drinking water context, EPA’s interim health advisory levels for perfluorooctanoic acid (PFOA) and PFOS, 0.004 and 0.02 parts per trillion, respectively, are below the level of both detection and quantitation for these chemicals.

[5] Kathryn M. Rodgers et al., How Well Do Product Labels Indicate the Presence of PFAS in Consumer Items Used by Children and Adolescents?, Environ Sci Technol. 2022 May 17; 56(10): 6294–6304.

[6] Lara Schultes et al., Total Fluorine Measurements in Food Packaging: How Do Current Methods Perform?, Environ. Sci. Technol. Lett. 2019, 6, 2, at 73–78.

[7] See, e.g., Anna Brinch et al., Risk Assessment of Fluorinated Substances in Cosmetic Products, Ministry of Environment and Food of Denmark. 2018 Oct, at 31.

[8] PFAS are generally added to consumer products to impart water and stain resistance.

[9] See 87 Fed. Reg. 54,415 (Sept. 6, 2022).

[10] 87 Fed. Reg. 74,379.

[11] 85 Fed. Reg. 45,109 (July 27, 2020).

[12] 86 Fed. Reg. 33,926 (June 28, 2021).

[13] See 15 U.S.C. §2602(13), (14).

[14] In March 2021, EPA published Regulatory Determinations for Contaminants on the Fourth Contaminant Candidate List, which included a final determination to regulate PFOA and PFOS in drinking water. 86 Fed Reg. 12,272 (Mar. 3, 2021) (Regulatory Determinations); 81 Fed. Reg. 81,099 (Nov. 17, 2016) (Fourth Contaminant Candidate List).

[15] 87 Fed. Reg. 36,848 (June 21, 2022).

[16] 87 Fed Reg. 68,060 (Nov. 14, 2022).

[17] 86 Fed. Reg. 73,131 (Dec. 27, 2021).

California Adopts Non-Emergency COVID-19 Prevention Workplace Regulations

Robertson  Daniel   Feltman-Frank_Arie  By Daniel L. Robertson and Arie Feltman-Frank, Associate Attorneys

On December 15, 2022, the California Occupational Safety & Health Standards Board (Board) adopted COVID-19 prevention non-emergency COVID-19 Workplace Safety  workplace standards in a 6-1 vote. The standards will be in Title 8, Division 1, Chapter 4, Subchapter 7, of California’s regulations and, if approved by the Office of Administrative Law, will take effect in January 2023. The standards will sunset two years following their effective date, except for certain recordkeeping requirements that will remain in effect for three years.

Subchapter 7, titled “General Industry Safety Orders,” establishes minimum occupational safety and health standards that generally apply to all places of employment in California. In response to the COVID-19 outbreak, the Board previously approved emergency temporary standards (ETS) on COVID-19 prevention starting in November 2020, which were revised in June 2017, January 2022, and May 2022. However, the May 2022 ETS is set to expire on December 31, 2022.

Notable portions of the adopted non-emergency standards are summarized below.

    • Prevention Program: Employers are no longer required to maintain a standalone COVID-19 Prevention Plan but must still address COVID-19 in their written Injury and Illness Prevention Programs or other standalone documents that include measures to address COVID-19 transmission in the workplace. Further, employers are required to review applicable state and local health department guidance when determining measures to prevent and address COVID-19 transmission.

    • Screening and Exclusion: Employers will no longer have to perform daily screenings of employees, whether through questionnaires or otherwise. Employees instead are encouraged to report their own symptoms and stay home if ill. Time periods for exclusion have been shortened, and employees who are deemed close contacts do not necessarily have to be excluded if they test negative and meet certain other requirements.

    • Employee Accommodations: In perhaps the most contested development, employers will no longer have to provide paid time off to infected employees or close contacts ordered to stay home. Instead, those employees must rely on other existing benefits if they are unable to work due to COVID-19 infection or isolation. Employers must continue to provide respirators to employees upon requests, and employees must still wear masks at work for at least 5 days if exposed. Companies experiencing outbreaks, defined as three or more cases in a 14-day period, must make testing available to exposed employees immediately and provide tests twice a week.

    • Notice and Timing: Notice rules now only require notice to close contacts “as soon as possible” while simplifying the notice contents. However, employers should remain mindful of similar applicable rules that currently still require that the notice be given within one business day. Outbreaks no longer require “no new cases” to conclude and instead only require “one or fewer” new cases over a two-week period. A major outbreak, defined as 20 cases in a 30-day period, must be reported to the California Division of Occupational Safety and Health. While there will no longer be a requirement to report outbreaks to local public health agencies, employers should still be mindful of other local standards for reporting.

    • Close Contacts and Testing: The “close contact” definition continues to follow that used by the California Department of Public Health (CDPH), which defines a close contact depending on the size of the workspace and regardless of the use of face coverings.

      • A close contact occurs in an indoor workspace with floor space of 400,000 cubic feet or less when someone shares the same indoor airspace as an infected person for a cumulative total of 15 minutes or more over a 24-hour period during the infectious period.
      • A close contact occurs for larger indoor workspaces when someone is within 6 feet of the infected person for a cumulative total of 15 minutes or more during a 24-hour period during the infectious period.

Notably, this standard affirmatively states that any future amendments to the CDPH definition will take precedent over the Board’s adopted definition. Employers must also follow applicable CDPH guidance to improve ventilation and filtration. Further, employers will now only have to make testing available at no cost to employees who are considered close contacts of an infected coworker, versus previous requirements that testing be made available to all symptomatic employees.

  • Infectious Period: This definition also tracks that of CDPH and states that a person is considered infectious for two days prior to symptoms and 10 days after unless they test negative from the fifth day onward. For an asymptomatic person, these same timeframes apply based on the date of the first positive test.

The Board’s news release can be read here and the text of the adopted standards is available here. We will continue to monitor COVID-19 and other workplace health and safety developments in the Corporate Environmental Lawyer.

 

EPA Proposes Rule to Enhance Reporting of PFAS Data to the Toxics Release Inventory

Robertson  Daniel

By:  Daniel L. Robertson, Associate Attorney

EPA Image2On December 5, 2022, the United States Environmental Protection Agency (USEPA) proposed a rule eliminating an exemption that currently allows facilities to avoid reporting the use of small concentrations of Per- and polyfluoroalkyl substances (PFAS).

PFAS chemicals, commonly referred to as “forever chemicals” due to their longevity, are commonly used in consumer products and industrial processes. The Biden administration has prioritized addressing PFAS as they apply to public health, as outlined in the USEPA’s PFAS Strategic Roadmap released in October 2021. That roadmap sets forth timelines by which the USEPA intends to act on various policies impacting public health, the environment, and accountability.

The 2020 National Defense Authorization Act (NDAA) added certain PFAS to the list of chemicals covered by the Toxics Release Inventory (TRI) for the 2021 reporting year. Under the current provisions, however, facilities that report to the TRI can disregard de minimis concentrations of TRI-listed PFAS in mixtures or trade name products (below 1% concentration, except for Perfluorooctanoic acid which is set at 0.1%).

The USEPA’s action follows a press release from earlier this year wherein the Agency expressed concern at the low number of reporting facilities, seemingly as a result of the existing exemption. The current proposal will add PFAS subject to reporting requirements under the Emergency Planning and Community Right-to-Know Act (EPCRA) and the Pollution Prevention Act (PPA) to the list of Lower Thresholds for Chemicals of Special Concern, eliminating the de minimis reporting exemption. Due to the low concentration of PFAS used in many products, the USEPA contends removing the existing “reporting loophole” will increase data collected for PFAS, thereby providing a clearer picture of PFAS releases and waste management quantities.

The proposal will also remove the de minimis exemption for purposes of the Supplier Notification Requirements for all listed Chemicals of Special Concern, which includes chemicals like lead and mercury. The USEPA states that doing so will ensure purchasers are informed of the presence of these chemicals in the products they purchase.

Parties that may be impacted by the proposal are those who manufacture, process, or otherwise use listed PFAS or any chemicals listed under 40 CFR 372.28. Anyone wishing to comment on the proposal must submit comments by February 2, 2023 through the Federal eRulemaking Portal using docket identification number EPA–HQ–TRI–2022–0270.

In related news, the USEPA on December 6, 2022 released a guidance memorandum providing states with directions on how to use the National Pollutant Discharge Elimination System (NPDES) permit program to protect against PFAS. According to the USEPA’s press release, the guidance “recommends that states use the most current sampling and analysis methods in their NPDES programs to identify known or suspected sources of PFAS and to take actions using their pretreatment and permitting authorities, such as imposing technology-based limits on sources of PFAS discharges.”

We will continue to monitor these and other federal PFAS developments on the Corporate Environmental Lawyer blog.