Jenner & Block LLP

Earth Day 2015: DOT, FRA, PHMSA Take Additional Steps to Improve Rail Hazmat Safety

Essig_Genevieve_COLORBy Genevieve J. Essig

 

The U.S. Department of Transportation (DOT), along with the Federal Railroad Administration (FRA) and Pipeline and Hazardous Materials Safety Administration (PHMSA), recently took additional steps in their action plan to improve safety with respect to transportation of flammable liquids, including crude oil, by rail.  These steps consisted of several main actions:

  • PHMSA Safety Advisory reminding hazardous materials shippers and carriers of “their responsibility to ensure that current, accurate and timely emergency response information is immediately available to emergency response officials for shipments of hazardous materials, and such information is maintained on a regular basis.”
  • PHMSA and FRA Safety Advisory reminding railroads operating a “high hazard flammable train” (HHFT) and offerors of Class 3 flammable liquids transported on such trains that certain information may be required by PHMSA and/or FRA personnel in their investigation immediately following an accident.
  • FRA Emergency Order requiring that trains transporting large amounts of Class 3 flammable liquid through certain highly populated areas to adhere to a speed limit (40 mph).
  • FRA Safety Advisory making recommendations intended to enhance the mechanical safety of the cars in trains transporting large quantities of flammable liquids.  In particular, the advisory recommends that railroads use highly qualified individuals to conduct the brake and mechanical inspections and recommends a reduction to the impact threshold levels the industry currently uses for wayside detectors that measure wheel impacts to ensure the wheel integrity of tank cars in those trains.
  • FRA Notice and comment request to gather additional data concerning rail cars carrying petroleum crude oil in any train involved in an FRA reportable accident. 
  • FRA Acting Administrator letter to the president of the Association of American Railroads (AAR) seeking an additional voluntary commitment to ensure certain relevant information is available to FRA and emergency responders immediately following a HHFT derailment, including information related to the lading, tank cars, and trains involved.  The letter requests a meeting within 30 days to discuss development of a process to do so.

These materials reference the July 2013 derailment in Lac-Mégantic, Quebec, Canada, as highlighting potential consequences of a railroad accident involving flammable liquids, as well as a number of other subsequent accidents in the U.S. involving trains transporting large quantities of crude oil and ethanol that resulted in hazardous material releases and fires – including three already in 2015.


Earth Day 2015: Trivia — April 21 (Answers)

Essig_Genevieve_COLORBy Genevieve J. Essig

 

Approximately what percentage of of the U.S.'s electricity demand is supplied by wind power? According to the U.S. Department of Energy's recent report Wind Vision: A New Era for Wind Power in the United States, as of 2013, U.S. electricity demand served by wind energy had tripled from 1.5% of total end-use demand in 2008 to 4.5%.

Earth Day 2015: Earth Day Celebrations — Earth Day Tokyo 2015 Event

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By Alexander J. Bandza Jenner & Block Earth Day 2015

 

This past weekend in Japan, the annual “Earth Day Tokyo” took place in the city’s Yoyogi Park. The event, which began in 2001 and now attracts more than 100,000 visitors, claims to be the largest annual environmental event in Japan. Japanese charities, non-profit organizations, and eco-conscious businesses set up booths to meet visitors. The two-day event features speakers, art, and free music.

The official website is here (in Japanese), and an English website with photos of past events is here.


Earth Day 2015: Beach Clean Up!

Grayson_Lynn_COLORBy E. Lynn Grayson Jenner & Block Earth Day 2015

 

On Friday, April 17th, Jenner & Block partnered with ComEd and Exelon to clean up the 12th Street beach at Northerly Island, in cooperation with the Alliance for the Great Lakes. Our group picked up over 85 pounds of broken glass, plastic beverage containers, food wrappers, cigarettes, and other miscellaneous trash and debris.

The Adopt-a-Beach program is the premier volunteer initiative for the Alliance for the Great Lakes. Teams remove litter and enter results into the Adopt-a-Beach online system to share with local beach authorities, educate the public, and improve the beaches and the health of the Great Lakes.

This picture shows our team after clean up efforts at 12th Street beach: 

Beach Day Cleanup

 

What will you do to celebrate Earth Day 2015? How about participating in the Adopt-a-Beach program?

To learn more about beach clean up opportunities or to schedule an event, visit http://www.greatlakes.org/.

A special thanks to our own Gay Sigel for organizing the Jenner & Block team. Thanks, Gay!

Earth Day 2015: Trivia — April 20 (Answers)

Essig_Genevieve_COLORBy Genevieve J. Essig

 

1. What recent environmental catastrophe in part inspired Gaylord Nelson to organize the first Earth Day in 1970? The first Earth Day followed closely on the heels of a massive oil spill off the coast of Santa Barbara, California, in 1969.  It is considered one of the largest oil spills to have taken place in United States waters.

2. What United Nations decade-long initiative aims to promote efforts to fulfill international commitments made on water and water-related issues by 2015? The United Nations' International Decade for Action, "Water for Life," 2005-2015, was proclaimed by the United Nations General Assembly in resolution A/RES/58/217. More information and updates are available here

Congratulations to Brian Fitzgerald for being our first correct responder!


Earth Day 2015: Earth Day Celebrations — Global Citizen 2015 Earth Day

Bandza_Alexander_COLORBy Alexander J. Bandza

 

Over the weekend, on April 18, 2015, over 200,000 people gathered on the National Mall in Washington DC for Global Citizen 2015 Earth Day, a collaboration between the Global Poverty Project and Earth Day Network. The two groups joined together to address ending extreme poverty and tackling climate change. Global Citizen 2015 Earth Day was co-hosted by will.i.am and Soledad O’Brien. The event featured performances by No Doubt, Usher, Fall Out Boy, Mary J. Blige, Train, and My Morning Jacket, with special guests Common, D’Banj, Fally Ipupa, VIXX, and Roy Kim.

For more information, including highlights of the event, check out the website here.


Earth Day 2015: Water Scarcity—Important Developments

Grayson_Lynn_COLORBy E. Lynn Grayson

 

While much progress has been made in the U.S. to address water quality since the first Earth Day in 1970, increasingly the critical issue of the day is water quantity and specifically sufficient availability of safe water for everyone. According to the World Water Council, 1 in 9 people in the world, or approximately 750 million individuals, lacks access to safe water. In January 2015, the World Economic Forum identified water scarcity as the #1 global risk based upon possible impact to society. These issues exist worldwide, including throughout the U.S.

This month, California Governor Jerry Brown announced the state's first-ever mandatory effort to cope with four years of the worst drought in California's history including a 25% use reduction on cities and towns. There are 5 things you need to know about California's water situation, according to National Geographic's ongoing research and study of water scarcity issues in the Western U.S.:

  1. The state (and much of the West) relies heavily on snowpack each winter to resupply surface water streams and lakes. Because of a lack of winter storms and record high temperatures this past winter, snowpack in California is at an all-time low. This is the fourth consecutive year that the snowpack has been below normal. The state's hydropower supply is also threatened when snowpack is scarce.
  2. When surface water supplies are low, hidden water supplies beneath the surface in aquifers, or groundwater, are drilled to make up the shortfall. A large aquifer under the Central Valley is being rapidly depleted to make up for shortfalls in surface water supply. A 2011 study indicated that the Central Valley Aquifer is losing an amount of water each year equivalent to the nearly 29 million acre-feet of water found in Lake Mead, the nation's largest surface reservoir on the Colorado River. (An acre-foot is one acre of ground covered one foot deep in water.) California for the first time last year passed legislation regulating groundwater use, but those restrictions will not come into effect for years.
  3. While the 25 percent water use restrictions announced last week are intended to help reduce demand, most of the water in California is used for farming, which was largely not included in Brown's announcement on restrictions. California's farms produce and export fruits and vegetables, hay for livestock, and meat and dairy products. Surface water for farms is allocated from state and federal water projects. Water supply restrictions for farmers may be announced soon by the state, but farmers have been drilling groundwater to compensate for surface supply shortages. Last week's rules require only that agricultural operations improve their reporting of water use to the state.
  4. California is not the only state in the West facing water supply issues. Winter snowpack in Oregon and parts of Washington was far below normal. The Colorado River Basin, which supplies water to Phoenix, Las Vegas, Los Angeles, and San Diego, has also been in a drought for more than a decade, and the river basin's aquifers have been declining, too. 
  5. When California faced a major drought in the late 1970s, fewer than 20 million people lived in the state. Now nearly 40 million live there. While Californians have drastically improved the efficiency of their water use in recent years, if rain and snow do not arrive later this year, the supply of groundwater—much of which is non-renewable—will continue to decline as it is used to make up for surface shortages.

The good news is there are two technical advancements that are currently available to mitigate water scarcity issues—one more mainstream and the other yet to be a "politically correct" option given public perceptions:

  1. Desalination—this age old process of converting seawater to drinking water is gaining in popularity despite costs and energy demands. A $1B plant is near completion by Poseidon Resources in Carlsbad, CA and will be the largest desalination plant in the Western Hemisphere. 13-15 plants are proposed for California between Los Angeles and San Francisco. There are 300 plants in the U.S. today and over 12,500 plants worldwide, particularly in the Middle East.
  2. Janicki Bioenergy's Omni Processor—the Bill and Melinda Gates Foundation has invested in this low cost, hyper-efficient sewage treatment plant which produces clean drinking water that meets both FDA and World Health Organization standards AND generates the very energy it requires to run. Janicki Bioenergy, based in Seattle, WA, has a prototype operating in Washington State and this year enters the developing world with a plant in Dekar, Senegal. Here's how it works:
  • The sewage sludge is fed into the plant by conveyor belt and dried in a tube that separates solid waste from water. The Omni Processor's intensely hot incinerator reaches 1,000 degrees Celsius, scorching enough to kill all pathogens and, perhaps more important for those living downwind, to operate without the expected offensive smell.
  • Converted into vapor, the water is spun in a centrifuge to remove remaining particles and then fed through two layers of filters. Next, it is cooled and condensed, at which point it is filtered one more time. The latest model can yield 86,000 liters of pure drinking water each day.
  • The remaining solids are then fed into an incinerator, yielding a high-powered steam that drives a generator, which in turn produces the very electricity that runs the plant (the Dakar unit produces 150 kW per day), plus excess energy that can be diverted back to the surrounding community. Another byproduct is a phosphorus-rich, disease-free ash that can be used as fertilizer. And the circle of life continues.

While some solutions exist, water remains a precious natural resource and there is no alternative. Every sector of society needs to do their part to conserve, protect and restore water resources in conjunction with governmental action to regulate quality concerns, improve infrastructure and water distribution systems, and address use limitations when appropriate.

For more information about water security, recent developments, and ongoing efforts to ensure the availability of access to safe water for everyone, visit Water.org at http://water.org or World Water Council at http://worldwatercouncil.org/.

Earth Day 2015: Trivia — April 20

Essig_Genevieve_COLORBy Genevieve J. Essig

 

1. What recent environmental catastrophe in part inspired Gaylord Nelson to organize the first Earth Day in 1970?

2. What United Nations decade-long initiative aims to promote efforts to fulfill international commitments made on water and water-related issues by 2015?

Please submit your answers to me at gessig@jenner.com and indicate whether you would mind us sharing your name in a later post, should you be the first correct responder.


Earth Day 2015 Special Series — April 20-24, 2015

 

In celebration of Earth Day 2015, the Corporate Environmental Lawyer blog will host a special campaign April 20-24 featuring a daily Earth Day trivia question, as well as unique news and stories about Earth Day events and activities taking place around the world, in addition to important developments in environmental law. As environmental lawyers, this is a good day for us to remember the contributions our clients and friends make to improving the environment in the communities where we live and work.

Earth Day 2015 commemorates the 45th anniversary of the first Earth Day held on April 22, 1970. This year more than 1 billion people in 192 countries will participate in Earth Day activities and events, making it the largest civic observance in the world.

To celebrate Earth Day, the Global Citizen 2015 Earth Day organizers will host a free event on the National Mall in Washington, D.C. on Saturday, April 18, featuring presentations and remarks by U.S. and UN leaders, as well as entertainment throughout the day from No Doubt, Usher, Fall Out Boy, Mary J. Blige, Train, and others. This special event will be web streamed live at www.globalcitizen2015earthday.org.

You are invited to follow and participate in our Earth Day special series next week at http://environblog.jenner.com  and follow us on Twitter @JennerBlockEHS.

If you have any questions about our Corporate Environmental Lawyer blog or this special series, please feel free to contact me at lgrayson@jenner.com or 312-923-2756.


EPA E-Manifest Implementation Update

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By E. Lynn Grayson

 

On October 5, 2012, President Obama signed into law the Hazardous Waste Electronic Manifest Establishment Act (PDF), which authorizes the EPA to implement a national electronic manifest system. Commonly referred to as "e-Manifest," this national system is envisioned to be implemented by the EPA in partnership with industry and states.

EPA issued the e-manifest final rule, effective August 6, 2014, authorizing the use of electronic hazardous waste manifests that will become available when EPA establishes a new electronic hazardous waste manifest system (79 Fed. Reg. 7518, February 7, 2014). The modification will provide waste handlers with the option to complete, sign, transmit, and store manifest information electronically in the electronic system. States that currently receive and collect paper manifest copies will receive copies of manifest data electronically from the system.

EPA Connect, the Agency's official blog, provided some updates this week on the status of the e-Manifest implementation process. EPA reported that an important next step is to establish the initial fee structure for users of the system. EPA is working with states and stakeholders to create this fee proposal. According to the blog, EPA anticipates the proposed rule establishing the fee model for the system to be available for public comment by May 2016.

When implemented, EPA estimates this rule will impact 160,000 entities in at least 45 industries that ship off-site, transport, or receive approximately 5.9 million tons of RCRA hazardous wastes annually. These entities currently use between 4.6 and 5.6 million EPA Uniform Hazardous Waste Manifests.

Further insights and regulatory developments are detailed at http://www.epa.gov/osw/hazard/transportation/manifest/e-man.htm.


OECD Recommends More Tariffs and Taxes to Manage Water Risks

Grayson_Lynn_COLORBy E. Lynn Grayson

 

Today's financing mechanisms cannot cover the cost of upgrading old water systems, due to public budget cuts, a failure to reflect future costs in water charges and a drop in tariff revenues as city dwellers use less water. A new report by the Organization for Economic Cooperation and Development (OECD) titled "Water and Cities: Ensuring Sustainable Futures" recommends redesigning tariffs and taxes to discourage wasteful or costly practices and seeking new sources of funding from users who generate the biggest costs.

The report also recommends that cities:

  • Improve the way they use taxes and tariffs. Taxes should be designed so those who benefit most from water systems or generate extra costs foot more of the bill. Tariffs should better reflect water scarcity and the cost of upgrading infrastructure. For example, new taxes could be aimed at property developers, who need first-rate water services.
  • Harness more private investment from financiers, property developers and entrepreneurs to finance new infrastructure or facilities like desalination or wastewater plants. Capital tied up in water infrastructures could be used to generate liquidity for new projects.
  • Drive innovation in water management by changing regulations that favor old technologies, having tariffs and taxes reflect the true cost of inefficient practices, and introducing performance-based contracts that reward objectives like conserving water.
  • Encourage co-operation between cities and their surroundings, e.g. using farmland as a buffer against floods or sending city run-off to be used for rural irrigation. Set up institutions that can manage water at different scales through urban-rural partnerships or through co-operation between neighboring towns and cities.
  • Where they exist, empower water regulators to protect the public interest and increase transparency in urban water supply and sanitation to make service providers more accountable, and to introduce more independence and technical underpinning in the setting of tariffs.

OECD projects global water demand will increase some 55 percent by 2050 when global population tops 9 billion. While OECD's 34 member countries currently enjoy water security, the report concludes now is the time to address water-related challenges presented by rapid urbanization that will adversely impact cities throughout the world.

OECD's report addresses global concerns but is good insight for U.S. cities facing water scarcity and drought concerns, now and in the future. It is well understood in the U.S. that the improvement of water infrastructure is key to effectively managing water resources.

More information about OECD's water related work including further insights into the new report is available at http://www.oecd.org.


Associate Alexander Bandza Explores the Michigan Environmental Protection Act

Essig_Genevieve_COLORBy Genevieve J. Essig

 

Associate Alexander Bandza co-authored an article that examines Michigan state courts’ brief adoption of Article III standing requirements for citizen-suit plaintiffs as witnessed through several recent appellate decisions interpreting the Michigan Environmental Protection Act (MEPA).  The authors provide a background on the Michigan Constitution and MEPA and review the shifting historical treatment of Article III standing requirements for citizen-suit plaintiffs in Michigan.  The authors conclude that as a practical matter, plaintiffs proceeding on statutory standing-based claims, and defendants responding to such claims, must regularly apprise themselves about the current availability of statutory standing in Michigan state courts in light of this uncertainty.

Mr. Bandza wrote the article with Andrew Armstrong, an attorney at the Environmental Law & Policy Center.   The article appears in the newsletter of the American Bar Association Section of Environment, Energy, and Resources Constitutional Law Committee.

The article is available here.


EPA Proposes New Nanoscale Chemical Reporting Rule

Grayson_Lynn_COLORBy E. Lynn Grayson

 

EPA has proposed one-time reporting and record keeping requirements on nanoscale chemical substances in the marketplace. The proposed rule contains a 90-day public comment period. After the comment period, EPA will review and consider those comments before issuing any final rule. EPA also anticipates a public meeting during the comment period to obtain additional public input.

Specifically, EPA proposed requiring companies that manufacture or process (or intend to manufacture or process) chemical substances in the nanoscale range to electronically report information, including the specific chemical identity, production volume, methods of manufacture, processing, use, exposure and release information, and available health and safety data. The proposed rule would apply to chemical substances that have unique properties related to their size. The proposed rule contains exclusions for chemical substances in the nanoscale range that would not be subject to the rule. In addition to this proposed one-time reporting on chemical substances manufactured or processed as nanoscale materials already in commerce, EPA currently reviews new chemical substances manufactured or processed as nanomaterials prior to introduction into the marketplace to ensure that they are safe.

Chemical substances that have structures with dimensions at the nanoscale -- approximately 1-100 nanometers (nm) -- are commonly referred to as nanoscale materials or nanoscale substances. A human hair is approximately 80,000-100,000 nanometers wide. These chemical substances may have properties different than the same chemical substances with structures at a larger scale, such as greater strength, lighter weight, and greater chemical reactivity. These enhanced or different properties give nanoscale materials a range of potentially beneficial public and commercial applications; however, the same special properties may cause some of these chemical substances to behave differently than conventional chemicals under specific conditions.

EPA is proposing this new requirement under TSCA Section 8(a) to determine if further action, including additional information collection, is needed.

More information about the proposed rule, including the Federal Register notice, EPA fact sheet and press release, are available at http://www.epa.gov/oppt/nano/.

World Water Day 2015

Grayson_Lynn_COLORBy E. Lynn Grayson

 

Designated by the UN General Assembly in 1993, World Water Day is celebrated each March 22nd. This year's theme for World Water Day is "Water and Sustainable Development." It is about how water links to all areas we need to consider to create a more sustainable future.

According to UN Water, a day for water and water for sustainable development includes the following considerations:

  1. Water is health – clean hands can save your life.
  2. Water is nature – ecocystems lie at the heart of the global water cycle.
  3. Water is urbanization – every week one million people move into cities.
  4. Water is industry – more water is used to manufacture a car than fill a swimming pool.
  5. Water is energy – water and energy are inseparable friends.
  6. Water is food – to produce two steaks, you need 15,000 liters of water.
  7. Water is equality – every day women spend millions of hours carrying water.

http://www.unwater.org/

FY2016 EPA Budget Proposal

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By E. Lynn Grayson

 

EPA Administrator Gina McCarthy recently testified before the Senate Environment and Public Works Committee regarding EPA's proposed 2016 fiscal year budget. EPA's 2016 fiscal year from October 1, 2015 through September 30, 2016. EPA is seeking an increase of $453M over the FY2015 budget to $8.6B proposed in FY2016.

FY2016 budget highlights include funding to address:

1.     Making a visible difference in communities across the country—efforts focused on coordination with other federal agencies, states, tribes and stakeholders to provide community support for needed assistance and support for capacity building, planning, and implementation of environmental protection programs;

2.    Addressing climate change and improving air quality—actions to reduce climate change and support the President's Climate Action Plan including new proposed funding for greenhouse gases through commonsense standards, guidelines and voluntary programs;

3.    Protecting the Nation's Waters—focus on to ensure waterways are clean and drinking water is safe because there are far reaching effects when rivers, lakes and oceans become polluted;

4.    Taking steps to improve chemical facility safety—support to improve the safety and security of chemical facilities and reduce the risks of hazardous chemicals to facility workers and operators, communities and responders;

5.    Protecting our lands—continued work to cleanup hazardous and nonhazardous wastes that can migrate to air, groundwater and surface water and soils;

6.    Ensuring the safety of chemicals and preventing pollution—expand chemical safety programs and enhance quality, accessibility and usefulness of information about commercial chemicals and pesticides;

7.    Continuing EPA's commitment to innovative research & development—R&D efforts to address the interplay between air quality, climate change, water quality, healthy communities and chemical safety;

8.    Supporting state and tribal partners—new funds for categorical grants and setting the bar for continuing partnership efforts with states and tribes;

9.    Maintaining a forward looking and adaptive EPA—emphasis on physical footprint including space optimization and essential renovations of laboratories throughout the U.S.; and,

10.    Reducing and eliminating programs—elimination of programs that have served their purpose and accomplished their mission for a cost savings of $44M.

For more information on the proposed budget, visit http://www2.epa.gov/planandbudget/fy2016.

CPSC Seeks Funding for Nanotechnology Center

Grayson_Lynn_COLORBy E. Lynn Grayson

 

The Consumer Product Safety Commission (CPSC) is seeking $7M to establish a nanotechnology center and proposes to create a five year interagency agreement with the National Science Foundation and a learning center or university to house the center. The proposed "Center for Consumer Product Applications and Safety Implications of Nanotechnology" would be a consortium of scientists tasked with researching methods to quantify and characterize the presence, release and mechanisms of consumer exposure to nanomaterials from consumer products.

Nanotechnology is the manipulation of matter on an atomic, molecular and supramolecular scale. While there is some controversy over the correct definition, nanomaterials generally are characterized by their tiny size, measured in nanometers. A nanometer is one millionth of a millimeter—approximately 100,000 times smaller than the diameter of a human hair. While nano-sized particles exist in nature, there is growing concern over the increased use of and impacts from engineered nanomaterials present in many commercial, industrial and consumer products—most nanoscale materials are too small to be seen with the naked eye or even with conventional lab microscopes, according to the National Institute of Environmental Health Sciences.

According to the CPSC, the Woodrow Wilson International Center for Scholars issued a 2008 report evaluating the CPSC's role in nanotechnology. The report concluded that nanotechnology is used in all of the categories that CPSC regulates including toys and baby products, sports and fitness equipment, home improvement and garden equipment, clothing, appliances, computers and other electronic devices. The Wilson Center has established a Consumer Products Inventory identifying over 1,800 consumer products that contain nanomaterials.

Even though the CPSC is attempting to take a more proactive approach to nanotechnology, it is believed by many that the CPSC is behind the curve in analyzing the impacts of nanomaterials in consumer goods, particularly those associated with children's products. All agree the launch of the new nanotechnology center would be an important step for the CPSC assuming the necessary funding can be secured.

The CPSC has been active in developing agreements with other agencies to address issues related to nanotechnology and is a member of the National Nanotechnology Initiative—a group of 25 government agencies that have committed resources for the completion of nanotechnology research to assess environmental, health and safety concerns and related data gaps.

Chicago Regional Trees Initiative

Grayson_Lynn_COLORBy E. Lynn Grayson

 

The Morton Arboretum and The Field Museum have partnered to launch the Chicago Regional Trees Initiative (CRTI) to study and understand Chicagoland's tree populations and identify opportunities for its collaborative management. The long term goal is to create healthier woodland environments distributed across seven counties including Cook, DuPage, Kane, Kendall, Lake, McHenry and Will.

Chicagoland's urban forests are threatened by invasive species such as buckthorn and honeysuckle. Trees that once dominated the landscape such as oak and hickory have become less abundant. These conditions make urban woodlands more vulnerable in facing challenges from climate change and destructive forces of parasites like the emerald ash borer beetle. As a result, many local communities face the possibility of nearly treeless streets and degraded forests.

The Field Museum's Science Action team is using a combination of satellite imagery, on-the-ground surveys and 3D elevation data to create interactive online maps to create a more accurate picture of the region's urban tree canopy and help identify potential problems. The CRTI will use this information to increase and diversify tree populations, combat invasive species and strengthen and update reporting and mapping tools.

Learn more about this CRTI at http://www.mortonarb.org/science-conservation/chicago-region-trees-initiative


New U.S. Funding for Water Scarcity in Western States

Grayson_Lynn_COLORBy E. Lynn Grayson

 

This month the U.S. agreed to provide $50 million for drought relief as California enters the fourth year of drought conditions. This funding will include $20 million for the Central Valley Water Project to address water transfers, drought monitoring for endangered species and diversifying water supplies.

California Governor Jerry Brown declared a drought emergency last January and signed a $687 million drought relief package. California residents cut monthly water use by 22% in December complying with state mandates to reduce water use by 20%.

Governor Brown has proposed spending $115 million for emergency drinking water and money for increased firefighting needs this year as well as part of his budget recommendations.

The California Office of Emergency Services reported last week in its bi-weekly drought brief that January 2015 finished up as one of the driest Januaries on historical record with very little meaningful precipitation throughout the state. At this time, California is only delivering 15% of the water requested from the state's vast reservoir system to farmers and local water agencies.

The ongoing drought conditions are having a variety of social, environmental and economic impacts throughout the state. The latest updates on drought conditions and state/local community actions can be viewed at California's Drought Information Clearinghouse via http://www.opr.ca.gov/s_droughtinfo.php.


Criminal Asbestos Case Against Tennessee Salvage Company

Grayson_Lynn_COLORBy E. Lynn Grayson

 

U.S. District Judge Ronnie Greer sentenced five people to prison terms in federal court in Greeneville, Tennessee, this week for conspiring to commit Clean Air Act offenses in connection with the illegal removal and disposal of asbestos-containing materials at the former Liberty Fibers Plant in Hamblen County, Tennessee, the Justice Department announced. A&E Salvage had purchased the plant out of bankruptcy in order to salvage metals which remained in the plant after it ceased operations.

U.S. District Judge Greer sentenced Mark Sawyer, 55, of Morristown, Tennessee, a former manager of A&E Salvage, to the statutory maximum of five years in prison, to be followed by two years of supervised release. A&E Salvage manager Newell Lynn Smith, 59, of Miami, Florida, was sentenced to 37 months and two years of supervised release. A&E Salvage Manager Eric Gruenberg, 50, of Lebanon, Tennessee, received a 28-month sentence. Armida, 56, and Milto DiSanti, 54, of Miami, Florida, each received sentences of six months in prison, to be followed by six months of home confinement. The judge ordered all the defendants to pay restitution of more than $10.3 million, which will be returned to Environmental Protection Agency's (EPA) Superfund, which was used to clean up the plant site contamination.

According to court documents, all the defendants pleaded guilty to one criminal felony count for conspiring to violate the Clean Air Act's "work practice standards" salient to the proper stripping, bagging, removal and disposal of asbestos. According to the EPA, the individuals engaged in a multi-year scheme in which substantial amounts of regulated asbestos containing materials were removed the former Liberty Fibers plant without removing all asbestos prior to demolition and stripping, bagging, removing and disposing of such asbestos in illegal manners and without providing workers the necessary protective equipment. 

While managing asbestos in renovations and demolition projects can be challenging from an environmental and worker safety perspective, there clearly is a right way to do it and a wrong way. This case serves as a good reminder that taking shortcuts to save time and/or money has significant consequences.


The Business Case for Environmental Sustainability

Grayson_Lynn_COLORBy E. Lynn Grayson

 

A corporation's main objective, and many would agree legal obligation, is to make money and maximize profits for its shareholders, but should more be asked or required of today's successful businesses? For an ever increasing segment of society, the answer without a doubt is "yes." The concept, commonly referred to as corporate social responsibility (CSR), extends beyond compliance with legal mandates or even charitable donations and good deeds. CSR advocates believe a company has a clear duty of care to all stakeholders connected to or impacted by a company's operation.

A new article, The Business Case for Environmental Sustainability, published this week in the American Bar Association's Business Law Today, by E. Lynn Grayson and Gary P. Kjelleren, addresses these considerations. The article examines environmental sustainability and why it matters for business. The authors detail key environmental sustainability focus areas and outline a roadmap of essential considerations companies should incorporate into any environmental stewardship initiatives. Lastly, they conclude that there is a business case for environmental sustainability that will improve financial performance.

The authors conclude there is a business case for environmental sustainability in the context of corporate social responsibility. In closing, they note: "It appears a virtual certainty that environmental sustainability will increasingly move from voluntary to legally mandated initiatives including sustainability reporting requirements. The critical inquiry for business is no longer if, but how and when to launch a meaningful environmental sustainability program. There is a growing business case for environmental sustainability. It is an added bonus that addressing these business challenges not only will enhance financial performance over time, but is simply the right thing to do as well."

World Bank Sells Record $91M of Green Bonds Tied to “Ethical” Companies

Grayson_Lynn_COLORBy E. Lynn Grayson

 

The World Bank sold $91 million in green bonds tied to an index of "ethical" companies – its largest offering of green bonds linked to an equity index and the first offered to individual investors.

Green bonds were created to increase funding by accessing the $80 trillion bond market and expanding the investor base for climate-friendly projects worldwide. They are fixed income, liquid financial instruments that are easy to understand, and the funds green bonds raise are dedicated exclusively to climate-mitigation and adaption projects, and other environmentally beneficial activities. This provides investors an attractive investment proposition as well as an opportunity to support environmentally sound projects, according to the World Bank.

The World Bank Treasury issued its first green bond in 2008, at a time when investors didn't have liquid, fixed income investment options that specifically supported climate-focused and environmentally-friendly projects. The World Bank has since issued more than US$7 billion in green bonds in 17 currencies, including a new green growth bond linked to an equity index and designed for retail investors. Separately, the International Finance Corporation (IFC) has issued US$3.7 billion, including two US$1 billion green bond sales in 2013. Proceeds form World Bank and IFC green bonds are used to support renewable energy, energy efficiency, sustainable transportation and other low-carbon projects, as well as financing for forest and watershed management, and infrastructure to prevent climate-related flood damage and build climate resilience.

The two institutions – whose AAA/Aaa ratings provide security for investors and development mandate and safeguards provide assurance for the use of proceeds and impact – have helped pioneer the green bond market, expand the investor base, and raise awareness about the needs and opportunities for climate-friendly investment.

The latest securities, which don't pay a coupon, are linked to the performance of the Ethical Europe Equity Index, a group of European companies that have no involvement in weapons, gambling, tobacco or nuclear energy. The seven-year notes were sold in $100 denominations to individuals in Belgium and Luxembourg, according to a World Bank statement.

The Washington-based lender, founded in 1944 with the goal of aiding post-war reconstruction, issued its first debt securities in 1947 and has sold more than $7 billion of green bonds in 78 deals. Global issuance of the securities, which are used to fund environmentally friendly projects, rose to a record last year, with $32.6 billion sold through October 24, according to data compiled by Bloomberg. Pension funds that are required to invest in sustainable assets have helped to fuel demand, according to Bloomberg New Energy Finance.

The Climate Bonds Initiative (CBI) also recently reported that the green bond market saw it biggest year yet in 2014. CBI has reported that almost $37 billion worth of labeled green bonds were issued in 2014--this figure is consistent with estimates also released by Bloomberg New Energy Finance.

According to the World Bank, the fastest growing cities and developing countries face increasing financial challenge from climate change. The green bond is a climate friendly investment developed to provide much needed funding to address climate change related impacts, primarily by governmental entities.


Environmental Groups Sue Over Applicability of TRI Data

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By E. Lynn Grayson

 

A recent lawsuit filed by 10 environmental groups against EPA alleges that EPCRA Section 313 Toxic Release Inventory (TRI) reporting should apply to oil and gas extraction companies. The environmental groups want TRI data regulatory requirements about releases to the environment to apply to oil drilling and exploration, hydraulic fracturing and natural gas processing activities.

According to the lawsuit recently filed in the U.S. District Court for the District of Columbia, EPA conducted rulemaking in the 1996-1997 time frame to consider adding other industry sectors to the list of facilities required to complete TRI reporting. At that time, EPA concluded that "oil and gas extraction classified in SIC code 13 is believed to conduct significant management activities that involve EPCRA Section 313 chemicals." EPA did not regulate the oil and gas industry following these earlier rulemaking efforts and for that reason, in 2012, environmental groups petitioned EPA to initiate rulemaking to add the oil and gas industry to TRI reporting requirements. The lawsuit alleges that EPA has not responded to that petition.

The environmental groups also allege that 127 tons of hazardous air pollutants are released by the oil and gas industry annually as well as other releases to the environment through discharges to surface waters, contamination of groundwater, underground injection and disposal in landfills. The lawsuit contends that regulation of the oil and gas industry is even more important today given the expansion of hydraulic fracturing and  horizontal drilling.

The environmental groups bringing the lawsuit include the: Environmental Integrity Project, Center for Effective Government, Chesapeake Climate Action Network, Citizens for Pennsylvania's Future, Clean Air Council, Delaware Riverkeeper Network, Natural Resources Defense Council, Responsible Drilling Alliance, and Texas Campaign for the Environment.

The oil and gas industry has concluded that TRI requirements never were intended to cover such facilities given the few employees typically involved in these operations and the multitude of other regulations applicable to the oil and gas industry. They also look to the 1996-1997 rulemaking effort but with a different recollection recalling that EPA confirmed at that time that "…This industry group is unique in that it may have related activities located over significantly large geographic areas. While together these activities may involve the management of significant quantities of EPCRA section 313 chemicals in addition to requiring significant employee involvement, taken at the smallest unit (individual well), neither the employee nor the chemical thresholds are likely to be met." Industry advocates have criticized these environmental groups, and particularly the Environmental Integrity Project, for attempting to manipulate data in order to oppose oil and gas development and seeking to impose additional regulatory requirements on an industry already heavily regulated.

The TRI program is an expansive regulatory initiative that mandates annual reporting obligations for certain facilities that fall within specific industry sectors, have 10 or more full time employees and manufacture or process 25,000 pounds of toxic chemicals subject to EPCRA Section 313 or otherwise use 10,000 pounds of these same chemicals in any given year. It is typically the case that  many of the oil and gas extraction operations would not meet these reporting thresholds as previously concluded by EPA. It appears, however, that this issue may be debated once again in the context of this case.

Another Criminal Conviction Under the Migratory Bird Treaty Act for Wind Farms

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By E. Lynn Grayson

 

PacifiCorp Energy has agreed to pay $2.5 million to settle charges arising from bird deaths at two of its wind farms located in Wyoming. PacifiCorp pled guilty in Wyoming federal court to two misdemeanor violations of the Migratory Bird Treaty Act and was sentenced to five years' probation. The company also agreed to institute a compliance program to prevent bird deaths at the utility's four commercial wind farms in Wyoming.

According to allegations, the company failed to make all reasonable efforts to build projects in a way that would avoid risk of bird deaths by collision with turbine blades consistent with guidance finalized by the Fish & Wildlife Service in 2012. The Migratory Bird Treaty Act violations were charged following discovery of the carcasses of 38 golden eagles and 336 other protected birds at the company's Seven Mile Hill and Glenrock/Rolling Hills wind farms in Carbon and Converse counties.

This is the second prosecution of wind farm owners and operators under the Migratory Bird Treaty Act. Duke Energy was convicted last year in similar charges flowing from bird deaths at two of its wind farms also located in Wyoming. See "First Criminal Conviction Under the Migratory Bird Treaty Act for Wind Farm" blog we posted on November 26, 2013.

These are very troubling cases that pit environmentalists against clean energy advocates. While wind farm energy is highly sought after in the U.S., it is clear there is an increased scrutiny on the utilities that operate these wind projects to ensure that construction, design and operation of these wind farms are protective of birds. In many ways, this seems like an almost impossible achievement for companies.