In the second installation of Jenner & Block’s Corporate Environmental Lawyer's discussion of emerging trends in Climate Change Litigation, we are highlighting recent investigations brought by US state attorneys general against private companies for allegedly misleading the public and/or company shareholders regarding the potential climate impacts of their operations.
In recent years, several major state investigations were launched following investigative journalism reports of private companies’ failures to disclose the causes and effects of climate change. One such example is the Los Angeles Times 2015 exposé into Exxon Mobil Corp.’s historic in-house research on climate change.
Approximately one month after the publication of the Los Angeles Times’ article, the New York Attorney General subpoenaed Exxon, seeking documents related to the company’s research on the causes and effects of climate change; the integration of its research findings into business decisions; and the company's disclosures of this information to shareholders and the Securities and Exchange Commission. The attorney general’s investigation was grounded in New York's shareholder-protection statute, the Martin Act, as well as New York’s consumer protection and general business laws.
In 2016, New York’s investigation was publically supported by a coalition of top state enforcement officials from Vermont, Virginia, Massachusetts, Maryland, Connecticut, and the Virgin Islands, all of which agreed to share information and strategies in similar climate change investigations and future litigation. Exxon responded by filing its own lawsuit seeking to block New York and Massachusetts’ investigations.
After a three-year contentious investigation, the New York Attorney General's office sued Exxon on October 24, 2018, alleging that Exxon engaged in “a longstanding fraudulent scheme” to deceive investors by providing false and misleading information about the financial risks the company faced from its contributions to climate change.
Jenner & Block’s Corporate Environmental Lawyer will continue to update on this matter, as well as other important climate change litigation cases, as they unfold.
On Tuesday, April 16th, from 12:00 - 1:00 pm CST, Jenner & Block is hosting an interactive webinar that will discuss how environmental claims can arise in many different contexts and how high costs can be avoided. One way to manage the cost of environmental claims associated with historical operations is to pursue coverage under historical (and often pre-pollution exclusion) occurrence-based commercial general liability insurance policies. Our panelists will discuss the nuances and pitfalls that can arise in environmental insurance litigation and creative strategies to maximize recovery. In addition, companies facing environmental risks in their current operations or transactions can also manage environmental risk through a variety of current insurance products. Our panelists will identify current options available to manage environmental risks going forward and provide insight into the costs and benefits of those insurance products.
Jenner & Block Partners Allison Torrence and Brian Scarbrough will be panelists, along with Richard Reich, Managing Director at Aon Risk Services Central, Inc. Jenner & Block Associate Alex Bandza will moderate the webinar.
Please click here to RSVP for this webinar.
New Jersey continues to take an aggressive stance with respect to per- and polyfluoralkyl (PFAS) contamination. On March 25, 2019, the New Jersey Department of Environmental Protection (NJDEP) issued a “Statewide PFAS Directive Information Request and Notice to Insurers” to five major chemical companies notifying those companies that NJDEP believed them to be responsible for PFAS impacts to the air and waters of New Jersey. In addition to seeking recovery from these companies for past costs incurred by NJDEP to investigate and remediate PFAS impacts, the Directive also seeks to compel these companies to assume responsibility for ongoing remediation of drinking water systems throughout the state. The Directive further seeks information from these companies regarding historical PFAS manufacturing practices as well as information regarding these companies’ ongoing efforts to manufacture PFAS replacement chemicals.
Although environmental organizations have been quick to praise the NJDEP Directive, in reality, the state agency may have overstepped its authority. NJDEP has been quick to point out that the Directive is not a final agency action, formal enforcement order, or other final legal determination and therefore cannot be appealed or contested. Notwithstanding NJDEP’s efforts to insulate its Directive from immediate legal challenge, it will almost certainly draw strong industry challenges. For example, NJDEP’s efforts to obtain information regarding PFAS replacement chemicals may run afoul of the Toxic Substances Control Act and its efforts to compel reimbursement of past claims and/or the takeover of ongoing remedial actions will certainly be the subject of court challenges.
Continuing its full court PFAS press, on April 1, 2019, New Jersey unveiled a proposed drinking water standard of 14 parts per trillion (ppt) for PFOA and 13 ppt for PFOS. These proposed drinking water levels are significantly lower than the current U.S. EPA health advisory level of 70 ppt for combined PFOS/PFOA.
The term “climate change litigation” has become a shorthand for a wide range of different legal proceedings associated with addressing the environmental impacts of climate change. Plaintiffs in climate change lawsuits may include individuals, non-governmental organizations, private companies, state or local level governments, and even company shareholders who, through various legal theories, allege that they have been harmed or will suffer future harm as a direct result of the world’s changing climate. The targets of climate change litigation have included individual public and private companies, government bodies, and even entire industry groups. While there appears to be no shortage of plaintiffs, defendants, or legal theories emerging in climate change litigation, one clear trend is that the number of these lawsuits has grown dramatically in recent years. By one count, more than fifty climate change suits have been filed in the United States every year since 2009, with over one hundred suits being filed in both 2016 and 2017.
In light of the growing trend of climate change litigation, Jenner & Block’s Corporate Environmental Lawyer blog is starting a periodic blog update which will discuss the emerging trends and key cases in this litigation arena. In each update, our blog will focus on a sub-set of climate change cases and discuss recent decisions on the topic. In Part 1 of this series, we will be discussing Citizen-Initiated Litigation Against National Governments.
U.S. EPA continues to be on the hook for damages associated with the Gold King Mine located in San Juan County, Colorado. Several years ago, a contractor working on behalf of U.S. EPA to address environmental impacts associated with a closed gold mine, destroyed a plug holding water trapped inside of the mine, causing the release of approximately three million gallons of mine waste water into Cement Creek, which was a tributary of the Animas River. Although U.S. EPA took responsibility for the incident, it has refused to pay damages incurred as a result of he release, leading to lawsuits being filed by a variety of plaintiffs, including the states of Utah and New Mexico, the Navajo Nation, and affected individuals. Plaintiffs asserted a variety of claims, including claims under CERCLA, RCRA, CWA, and the Federal Tort Claims Act (FCTA). U.S. EPA filed a motion to dismiss, arguing among other things, that it was entitled to sovereign immunity for damages resulting from an ongoing cleanup effort.
On February 28, 2019, the federal district court in New Mexico rejected U.S. EPA’s claim that it was protected from CERCLA liability on sovereign immunity grounds, noting that at least three circuit courts have found that U.S. EPA can face liability under CERCLA where U. S. EPA’s actions in remediating a site are alleged to have caused releases of hazardous wastes. The court also found that plaintiffs’ allegations (which included Utah and New Mexico, as well as the Navajo Nation and individuals), if proven, would demonstrate U.S. EPA’s liability as an “arranger,” “operator,” and “transporter” of hazardous substances. Specifically, Plaintiffs stated claims for arranger liability because they "allege that EPA took intentional steps to dispose of a hazardous substance.” With respect to operator liability, the court noted that Plaintiffs “allege that EPA managed, directed, or conducted operations specifically related to the pollution, that is, operations having to do with the leakage or disposal of hazardous waste.” Finally, regarding transporter liability, Plaintiffs “allege that EPA took steps to drain the mine and treat the water at the site.”
With respect to the RCRA, CWA, and FCTA claims, the court concluded that there were disputed issues of fact that precluded the court from being able to grant dismissal of those claims. We will continue to provide updates on this proceeding.
In a 2-1 decision on February 28, 2019, the full Occupational Safety and Health Review Commission (“OSHRC”) vacated the U.S. Secretary of Labor’s Occupational Safety and Health Administration’s (“OSHA”) citation charging a roofing contractor with a “general duty clause” violation for exposing employees “to the hazard of excessive heat from working on a commercial roof in the direct sun” and separately vacated a citation for failure to train employees regarding heat-related risks. Sec’y of Labor v. A.H. Sturgill Roofing, Inc., OSHRC Docket No. 13-0224. OSHA had issued the citations following the physical collapse and subsequent death of a temporary worker on the first day of his work for the roofing company.
Different from a violation based on an OSHA regulation, a general duty clause violation alleges that the employer has violated the federal Occupational Safety and Health Act’s provision stating: “Each employer … shall furnish to each of his employees employment and a place of employment which are free from recognized hazards that are causing or are likely to cause death or serious physical harm to his employees.” 29 U.S.C. § 654(a)(1).
BACT to the Future: Enviros Petition for Review on Natural Gas Power Plant Air Permit, Saying Batteries Are “BACT” Under the Clean Air Act
Last week, the Center for Biological Diversity and other environmental groups petitioned the Ninth Circuit for review of EPA Region 9’s decision in December 2018 to issue a final prevention of significant deterioration (PSD) permit for the Palmdale Energy Project (Project), a gas-fired plant being developed in the city of Palmdale, CA. These environmental groups had previously but unsuccessfully challenged the permit in front of EPA’s Environmental Appeals Board (EAB), arguing that a new control technology configuration—namely, replacing the combined-cycle turbines’ duct burners with battery storage—should be used to satisfy EPA Region 9’s “Best Available Control Technology” (BACT) requirements under the Clean Air Act (CAA). The EAB denied the environmental groups’ appeal in October 2018. However, as the EAB explicitly recognized, “energy storage technology is a rapidly growing development in the electrical power supply sector,” and therefore the totality of the environmental groups’ efforts may spur additional consideration of battery storage as an option for facilities to meet their obligations under the CAA.
OSHA Rescinds Electronic Submission of Injury/Illness Logs and Incident Reports and Raises Penalties
On January 25, 2019, the U.S. Occupational Safety and Health Administration (OSHA) issued a Final Rule eliminating the requirement that certain employers electronically submit to OSHA information from their annual OSHA 300 log of workplace injuries and illnesses and their OSHA 301 incident reports, which are required to be created after each logged injury and illness. OSHA also announced that, pursuant to annual escalating requirements, penalties for OSHA violations in 2019 would increase to a maximum of $132,598 per willful or repeat violation and a maximum of $13,260 for all other types of violations.
Pursuant to a regulation issued in the final year of the Obama Administration, employers of establishments with 250 or more employees were to be required to submit information from their 300 logs and 301 reports annually to OSHA through an electronic portal. However, the portal was never established during the Obama or Trump Administrations, and the submission obligation was repeatedly suspended until, through the Final Rule, the electronic submission requirement was rescinded entirely.
OSHA described the Final Rule rescinding the submission requirement as primarily driven to “protect worker privacy,” because the OSHA 300 logs and 301 reports contain identifying information which “might be publicly disclosed” under Freedom of Information Act (FOIA) requests or otherwise. In the Final Rule’s preamble, OSHA stressed that its position is that data electronically submitted to OSHA regarding injuries and illnesses are exempt from FOIA public disclosure, both to protect OSHA’s enforcement efforts and to protect employees’ privacy. OSHA stated, however, that despite its position, it is concerned that “it still could be required by a court to release the data,” if it had not rescinded the broader submission requirements. OSHA also expressed concern that, if information from the 300 logs and 301 reports had been electronically collected pursuant to the regulation as issued in 2016, there were increased risks of cyber-security issues involved in protecting sensitive information. OSHA also stated that by rescinding the electronic submission requirement, OSHA can “focus its resources on initiatives that its past experience has shown to be useful … rather than on collecting and processing information from Forms 300 and 301 with uncertain value for OSHA enforcement and compliance assistance.”
Employers of establishments with 250 or more employees, or with 20-249 employees in designated high-hazard industries, remain obligated to annually, electronically submit information from OSHA Form 300A, which summarizes information from the annual OSHA 300 log and 301 reports. The OSHA Summary Form 300A for 2018 injuries and illnesses must be physically posted at each establishment by February 1, 2019, and submitted electronically to OSHA by March 2, 2019. The Form 300A electronic submission information also has been amended to require employers to include their Employer Identification Number (EIN). The requirement to electronically submit the 300A Summary and EIN applies nationwide, including to employers in the 28 State Plan States.
The January 25, 2019 Final Rule does not change the obligation of employers in most industries (unless specifically exempted) to maintain OSHA 300 logs and 301 reports at their establishments, for inspection by OSHA, employees, and their representatives. In addition, all employers continue to be required to report to OSHA, within prescribed time periods, when an employee is killed on the job or suffers a work-related hospitalization, amputation, or loss of an eye. State requirements regarding injury reporting may be more stringent than those imposed by federal OSHA.
What's in Your Baby Powder: NY Proposes Stringent New Disclosure Requirements on Cleaning and Personal Care Products
Last week, New York Governor Andrew Cuomo announced the Consumer Right to Know Act (“Act”) as part of his proposed executive budget. The Act would authorize the New York Department of Environmental Conservation, along with the New York Department of Health and the New York Department of State, to promulgate regulations requiring product manufacturers to disclose the presence of potentially hazardous substances on their product labeling. Among other things, the Act would require these agencies to assess the feasibility of on-package labeling; develop regulations establishing a labeling requirement for designated products; develop a list of more than 1,000 substances that must be labeled; and identify the types of consumer products that will be subject to these new labeling requirements. The Act would also extend the Department of Environmental Conservation’s disclosure requirements for household cleaning products to encompass all cleaning products sold in New York, and it would empower the Department of Health to require similar disclosures for personal care products like shampoo, deodorant, or baby powder. Needless to say, these disclosure requirements would be among the most stringent—if not the most stringent—in the United States.
Governor Cuomo’s announcement is available here. We will keep our readers updated on the progress of Governor Cuomo’s proposal.
Exploring the E-Suite with Sharon Neal, Assistant General Counsel-EHS Counsel,
Exelon BSC, Law Department
- How did you get involved in environmental law?
My interest in the environment began when I was young, around 10‑12 years old. I recall hearing my parents talk of their concerns about the environment and that triggered my curiosity. In college, I began by focusing on environmental science. In my sophomore year, a single paragraph in an environmental studies text discussed environmental law as an up-and-coming field for those with an interest in protecting the environment and shaping policy. From that moment, I decided to become an environmental lawyer. I graduated from Loyola University Chicago School of Law in 1988. I became a lawyer for the Illinois EPA in 1990, and I have been practicing environmental law ever since.
- What do you enjoy most about your work in environmental law?
I have never stopped finding my work in this field interesting and meaningful. No two days mirror one another. There is always something new to learn and do in light of the vast, ever changing nature of the environmental field. Even after more than 20 years with Exelon, my knowledge of the Company’s broad range of operations continues to grow. I have also so enjoyed and appreciated the many talented, intelligent and committed people with whom I have worked over my entire career, who have a wide range of expertise, such as in environmental science, investigation, remediation, nuclear operations, utility operations, regulatory and governmental affairs, and law. They have truly enriched my practice and life.
- What do you find to be the most challenging aspect of environmental law?
As a field, environmental law is especially challenging in light of the seemingly endless and changing laws, regulations, and other requirements, at the federal, state and local levels, with separate requirements for air, land, and water. It is challenging to stay current and to understand the legal implications for a large company that has many different types of complex operations. As with all fast-paced work, deadlines and competition for time are always a challenge. Also, unique to environmental law, is the deep intersection of science, law, and policy. The longer I have practiced, the more I have come to understand that you cannot possibly be an expert in all aspects of environmental law; there just too much to know and to know well. However, I do feel that what makes this field challenging also makes it continually interesting.
- What or who helped you succeed as an environmental lawyer?
I have had the privilege of working with so many exceptionally bright and experienced environmental specialists, consultants, attorneys (in-house and outside counsel) since my start in environmental law, as well as great, supportive managers and company leaders, here at Exelon, who prioritize environmental compliance and stewardship. That has made all the difference. Much of what I do is as part of a team made up of persons with diverse expertise. We work together and rely on each other to succeed.
- What do you think are the emerging issues in the field of environmental law?
Climate change will be at the heart of much of environmental law and policy going forward. There will be great emphasis on efforts to limit the operations that impact and create climate change, along with more and continuing efforts to reduce those impacts. There also will be a focus on responding and adapting to the effects that we already are seeing and that we will increasingly see in the future. We cannot overstate the significance of climate change in environmental issues going forward.
- Describe those projects as an environmental lawyer of which you are the proudest.
Looking at my career as a whole, what stands out initially is the work I did when I was with the Illinois EPA. That was my first environmental position, so my learning curve was steep. Yet, within those first couple of years, I was able to negotiate and write state laws and regulations. I appreciate that I had the opportunity to do such important work so early in my career.
I have worked on so many interesting matters at Exelon. The focus of my work has changed many times over the years, depending on regulatory and operational/business developments. Some of the most fascinating work has been supporting Exelon Nuclear, including on Clean Water Act issues. I have spent much time at our nuclear stations, including at the Quad Cities Generating Stations, which, among other things, operates a successful fish hatchery that feeds into the Mississippi River. I also had the opportunity to attend a U.S. Supreme Court argument concerning federal regulations under the Clean Water Act, which affected Exelon, among other regulated entities. I have supported Exelon on many interesting projects over the years focused on evaluating, preventing and mitigating environmental impacts. I have especially enjoyed learning about and supporting Exelon’s many environmental stewardship projects.
- Which community service or pro bono matters have been the most meaningful to you and why?
Exelon has an extensive pro bono and volunteer network, which provides opportunities for employees to participate in numerous activities that benefit a wide range of organizations and individuals in the communities that Exelon serves. At our annual Exelon Law Department All Hands clinics, attorneys and support staff work together to help many persons in single day’s event. At a recent clinic, we assisted seniors with planning and preparing important end of life documents. Last year’s clinic focused on providing support for those seeking immigration relief. Exelon’s Law Department holds such clinics annually in each of its four main cities, Chicago, Philadelphia, Baltimore and Washington D.C.
In the past year, I have also participated in some especially rewarding events and projects focused on introducing children and young adults to the field of law. A few of these events have supported “Just the Beginning”, a pipeline organization that motivates young people in economically challenged communities to become part of the legal profession and future leaders. I have also worked with young students in the “Lawyers in the Classroom” program, sponsored by the Constitutional Rights Foundation Chicago. It is a pleasure to teach and talk with the students in these programs and encourage them to see the legal profession as meaningful and attainable.
Also, in the past year, at the recommendation of a friend and colleague within the Exelon/EHS legal group, I became a board member of Thresholds, one of the oldest and largest Illinois organizations supporting persons with mental illnesses and substance use disorders. Thresholds provides a wide range of support—from care to employment to housing—for thousands of people in the broader Chicagoland community. I have been deeply gratified by the support I have received from Exelon and other friends, such as Jenner & Block, for my work on behalf of Thresholds.
- What advice would you give a young person today who is considering starting out in your field?
I am confident that environmental law, and the field of environmental studies, in general, will continue to be important, fascinating work. If you have the opportunity to work for the government, especially early in your career, take that opportunity. Government service is an incredible place to learn, not only substantive environmental law, but many aspects of how policy comes to be law, how regulations are drafted and laws are enacted, interagency relationships, and the needs and role of the regulated community. I am grateful to have had that opportunity at the start of my career.
Ms. Neal was interviewed by Gabrielle Sigel, Co-Chair, Environmental and Workplace Health and Safety Law Practice, Jenner & Block
In 2016, U.S. EPA established an advisory level of 70 parts per trillion (PPT) for combined perfluorooctanoic acid (PFOA) and perfluorooctane sulfonate (PFOS)-- two of the more commonly found polyfluoroalkyl substances (PFAS). However, the Agency for Toxic Substances and Disease Registry (ATSDR) recently suggested that these advisory levels may not be stringent enough, releasing draft risk values earlier in 2018 that are significantly more conservative than the values relied upon by U.S. EPA in 2016. The ATSDR draft report identifies a minimal risk level for PFOA that equates to approximately 11 ppt and approximately seven ppt for PFOS.
The ATSDR draft report, the issuance of which the White House had sought to delay, has been subject to criticism by both sides of the spectrum, with some questioning the science behind the conclusions reached in the report, while others claim that the draft report doesn’t go far enough. The public comment period on the draft report closed on August 20, 2018 and the report has yet to be finalized.
However, in lieu of waiting for the report to be finalized and/or for U.S. EPA to take further action to revise its current health advisory level, several states have elected to move forward to establish their own regulatory limits for these chemicals. New Jersey and Vermont had taken the lead in adopting more stringent regulatory standards, with New Jersey adopting a 14 ppt limit for PFOA and Vermont adopting a 20 ppt limit for combined PFAS in drinking water. However, these levels were established prior to the release of the draft ATSDR report and a number of other states have since jumped on the regulatory bandwagon. For example, New York’s Drinking Water Quality Council recently recommended that New York adopt a 10 ppt limit for PFOA and PFOS. Michigan, which had adopted U.S. EPA’s recommended advisory level of 70 ppt, also is in the process of developing more stringent standards for PFAS in drinking water.
ATSDR has yet to release a time-line for finalizing its draft toxicological profile for PFAS and although U.S. EPA has announced that it intends to evaluate the need for a maximum contaminant level (MCL) for PFOA and PFOS, that is several years away. In the interim, it appears likely that individual states will continue to adopt their own individual regulatory levels for these chemicals in drinking water which will continue to result in a patchwork regulatory framework across the United States.
OSHA’s Directorate of Enforcement Programs recently issued an enforcement memorandum to all OSHA Regional Administrators providing a new “Enforcement Policy for Respiratory Hazards Not Covered by OSHA Permissible Exposure Limits” (“Enforcement Policy”). OSHA’s 2003 policy on the same topic is now superseded and archived.
The Enforcement Policy explains how and when OSHA will cite an employer for respiratory hazards from an air contaminant under the OSH Act’s General Duty Clause (“GDC”). The GDC is the statutory requirement that an employer “furnish to each of his employees employment and a place of employment which are free from recognized hazards that are causing or are likely to cause death or serious physical harm.” 29 U.S.C. § 654(a)(1). By regulation, OSHA has stated that “An employer who is in compliance with any standard in this part shall be deemed to be in compliance with the requirement of section 5(a)(1) of the Act, but only to the extent of the condition, practice, means, method, operation, or process covered by the standard.” 29 CFR 1910.5(f). There is an open question as to whether and when an employer is in violation of the law if either (a) OSHA has not set a regulatory exposure limit for a particular chemical; or (b) exposures are below OSHA’s regulatory Permissible Exposure Limit (“PEL”), but above another organization’s recommended occupational exposure limit (“OEL”) for the same chemical. An OEL can be issued by, for example, an industry group, U.S. EPA, the National Institute for Occupational Safety and Health, or the American Conference of Governmental Industrial Hygienists.
OSHA’s new Enforcement Policy states that a GDC violation for airborne chemical exposures cannot be alleged unless OSHA can meet the 4-element standard of proof imposed by the courts for any GDC violation:
On December 11, 2018, the U.S. EPA and the U.S. Army Corps of Engineers jointly issued a proposed rule to define the basic jurisdictional reach of the federal Clean Water Act (“CWA”), which applies to protection of the “navigable waters” of the U.S. The proposed rule defines the term “waters of the United States,” which establishes the scope of waters subject to the CWA (“the Proposed WOTUS Rule”). The definition of WOTUS has been the subject of decades of litigation, including at the U.S. Supreme Court, see Rapanos v. U.S., 547 U.S. 715 (2006), itself a divided opinion. The Trump Administration’s WOTUS rule, when issued in final, would replace the definitional rule issued in June 2015 by the Obama Administration. 80 Fed. Reg. 37054. Obama’s 2015 rule itself was the subject of litigation; including after the Trump Administration attempted to delay application of that rule. See, e.g., Puget Soundkeeper Alliance v. Wheeler, No. C15-1342-JCC (W.D. Wash. Nov. 26, 2018). As of now, 28 States are not subject to the 2015 rule, but to the definition of WOTUS pursuant to rules issued in 1977 and the 1980s, as well as decisions of the Supreme Court and the agencies’ guidance and practices.
The Proposed WOTUS Rule, which the Trump Administration states is consistent with the Rapanos plurality opinion written by Justice Scalia, purports to provide “clarity, predictability, and consistency” and, by limiting the scope of the CWA’s jurisdiction, “gives states and cities more flexibility to determine how best to manage waters within their borders.” By setting forth “six clear categories of waters” that are considered WOTUS, the Proposed WOTUS Rule seeks to ensure that the CWA applies only to those waters “that are physically and meaningfully connected to traditional navigable waters.” The six categories are, in general:
On Thursday, November 29th, Jenner & Block Associate Matthew Lawson will be giving a CLE presentation on the “Environmental Impact of Blockchain” at the Chicago Bar Association’s Young Lawyers Environmental Law Committee Meeting. Matthew Lawson’s presentation will discuss both the negative environmental impacts caused by the growth in popularity of cryptocurrency mining, and the potential positive impacts on the environment from emerging and future applications of the Blockchain technology.
The presentation is on November 29, 2018, from 12:15 PM - 1:30 PM at the Chicago Bar Association, 321 S. Plymouth Ct. Chicago, IL 60604.
For more information on the event click here.
The director of the Agency for Toxic Substances and Disease Registry (ATSDR), Peter Breysse, continues to defend his agency's minimal risk levels (MRLs) for perfluorinated chemicals that were released in June 2018 as part of a draft toxicological profile. In response to questions posed at a recent Senate hearing, Breysse noted that ATSDR’s draft MRLs roughly corresponded to drinking water levels of 14 parts per trillion (ppt) for perfluorooctane sulfonate (PFOS) and 21 ppt for perfluorooctanoic acid (PFOA). Where these levels are exceeded, ATSDR has recommended that residents take steps to lower their exposures and contact state and local authorities. Breysse also recommended that residents consult with physicians and noted that ATSDR has information on its website for physicians to consult regarding exposure risks for these chemicals.
The drinking water levels referenced in the ATSDR toxicological profile (14 ppt for PFOS and 21 ppt for PFOA) correspond generally with regulatory standards implemented in several states, including New Jersey and Vermont, both of which have the lowest regulatory levels for these compounds in the United States. However, the ATSDR MRLs are much stricter than U. S. EPA’s drinking water advisory level of 70 ppt. In addition, many news outlets reported that U.S. EPA had sought to delay ATSDR’s issuance of its June 2018 toxicological profile. Perhaps coincidentally, at about the same time as ATSDR issued its draft report, U.S. EPA announced plans to begin to evaluate the need for a maximum contaminant level (MCL) for PFOA and PFOS.
Although ATSDR and U.S. EPA continue to work cooperatively (at least on paper) to address PFOA and PFOS at contaminated properties throughout the United States, it remains to be seen how well these agencies will cooperate in setting an MCL for these contaminants. The agencies' "cooperative" relationship may face choppy waters, especially in light of ATSDR's continued defense of its MRLs and U.S. EPA's skeptical view regarding same.
On Tuesday, November 6th, Colorado voters rejected a highly contested ballot initiative which would have set unprecedented limits on oil and gas drilling in the state. The measure, Proposition 112, would have prohibited drilling new oil or natural gas wells within 2,500 feet of certain occupied buildings—including homes, schools and hospitals; various water sources—including lakes, rivers and creeks; and other areas specifically designated as “vulnerable” by the state. In total, a report from the Colorado Oil & Gas Conservation Commission estimated that the measure would have prohibited new hydraulic fracturing operations on as much as 95% of the land in Colorado’s top oil and gas producing counties.
The proposition received a high degree of pre-election attention, with individuals from politician Bernie Sanders to actor Leonardo DiCaprio encouraging Colorado voters to support the initiative. While early polling indicated Proposition 112 was supported by the majority of Colorado voters, the initiative was ultimately defeated with 57% of the state’s voters opposing it in Tuesday’s elections. In what may have served as a fatal blow, Colorado’s governor-elect, Jared Polis, distanced himself from the ballot initiative in the days leading up to the election. The newly elected Democrat had campaigned as a pro-environment alternative to his Republican opponent, but categorized the ballot initiative as “economically damaging” to the state of Colorado.
At present, New York, Vermont, and Maryland are the only states to have established outright bans on fracking. None of those states, however, has oil and gas reserves approaching the production capacity of Colorado. The state’s oil and gas industry has grown dramatically in the last decade, with the state’s production of crude oil rising from 73,000 barrels per day in 2008 to 477,000 barrels per day in August 2018. As the state’s production of oil and gas continues to grow, it appears likely that legislative battles over fracking regulations will continue to unfold.
New Jersey Federal District Court Dismisses Enviro’s Constitutional Challenges to FERC’s Approval of PennEast’s $1B Gas Pipeline, Holding that the Court Doesn’t Have Jurisdiction under the Natural Gas Act
On Monday, in N.J. Conservation Found. v. FERC (No. 17-11991), the U.S. District Court for the District of New Jersey dismissed the New Jersey Conservation Foundation’s (“NJCF”) suit against the Federal Energy Regulatory Commission (“FERC”) because the Court found that the courts of appeals, and not it, had subject matter jurisdiction under the Natural Gas Act (“NGA”). NJCF’s suit sought to declare that FERC’s practice of issuing certificates authorizing the construction of natural gas pipeline facilities violated the U.S. Constitution. While pled solely against FERC and its Commissioners, the case was predicated on FERC’s prior approval of PennEast Pipeline Company, LLC’s (“PennEast”) right to construct a $1B interstate natural gas pipeline. NJCF’s case centered on three purported Constitutional issues with FERC’s environmental analysis: (1) FERC’s approvals that delegate the power of eminent domain in the absence of adequate public use analyses violate the Takings Clause; (2) FERC’s approvals that grant eminent domain prior to receiving environmental impact findings from regulatory agencies violate the Fifth Amendment; and (3) FERC’s approvals that provide for subsequent state or federal authorizations, which then may require changes to the pipeline route or prevent construction, also violate the Takings Clause. The Court granted FERC’s motion to dismiss, holding that the Court did not have subject matter jurisdiction because the NGA vested the courts of appeals, not district courts, with exclusive jurisdiction to hear NJCF’s claims. NJCF is another voice in a growing chorus of district court and appellate cases that have rejected dissatisfied parties’ collateral attempts to re-litigate FERC’s decisions and decision-making processes, especially with regard to environmental issues, outside of FERC.
The United States’ Largest Wholesale Energy Provider Launches Blockchain-Based Pilot for Renewable Energy Markets
On April 18, 2018, the Corporate Environmental Lawyer published a blog entry discussing the growing use of Blockchain technology by startup companies seeking to connect populations without access to traditional electricity markets to electricity produced by distributed renewable energy systems. As discussed in that blog entry, proponents of Blockchain technology have asserted the platform’s built-in efficiencies would allow it to compete with traditional, utility-owned electrical grids, with one company going as far as setting up a “micro-grid” in Brooklyn, New York. It appears that the marriage between Blockchain and the electricity grid may be moving forward at an accelerated pace as the technology is now being examined and piloted by major utility operators.
PJM Interconnection (“PJM”), the United States’ largest power grid operator and market administrator serving over 65 million people from Chicago to Washington D.C., has announced its intention to test a Blockchain system that will allow clean-energy buyers and sellers to trade the renewable energy credits that wind and solar farms produce as they generate electricity. Working through its subsidiary—PJM Environmental Information Services—PJM has announced a partnership with Energy Web Foundation, a nonprofit entity with experience developing Blockchain platforms for smaller energy markets in Europe and Asia. The partnership hopes to rollout a pilot for the program by the end of the first quarter of 2018. “This collaboration between EWF and PJM-EIS is a major milestone for the adoption of advanced digital technologies in the energy sector,” said Hervé Touati, CEO of Energy Web Foundation. “We are excited to partner with a leader such as PJM-EIS.”
Blockchain, the technology that functions as a public ledger underpinning digital currency transactions, continues to be promoted as a key driver of growing renewable energy markets. At its core, the belief that Blockchain can spur renewable energy growth and disrupt current energy markets stems from the potential built-in efficiencies of the technology, which allow buyers and sellers of clean power to interact directly, without the need for a central coordinator. While the potential impact of Blockchain on future energy markets is still unknown, the successful use of the technology by PJM could represent a major milestone in the growth and development of the technology in the marketplace.
On October 23, 2018, President Trump signed into law America’s Water Infrastructure Act of 2018 which, in addition to authorizing federal funding for water infrastructure projects, also requires drinking water systems serving more than 3,300 people to test for unregulated contaminants pursuant to U.S. EPA’s Unregulated Contaminants Monitoring Rule (UCMR). Prior to this new law, only drinking water systems that served more than 10,000 people were required to monitor for unregulated contaminants. Contaminants covered by the UCMR include PFOA, PFOS, 1,2,3-TCP, hexavalent chromium and 1,4-dioxane. This new testing requirement, which goes into effect in 2021, is expected to add more than 5,000 drinking water systems to the list of systems that are required to test for these unregulated contaminants.
The challenge that continues to be faced by drinking water systems across the country is what to do if these contaminants are in fact found in the drinking water supply. As their name would imply, U.S. EPA has yet to set drinking standards for these contaminants although many states and local entities continue to enact a patchwork of regulatory requirements often without regard to the technical feasibility of treating these chemicals and/or the health risks actually posed by these chemicals. Unfortunately, until such time as U.S. EPA takes action to enact a federal standard, the regulated community will continue to be subject to this regulatory quagmire and now, with the new testing requirements, more drinking water systems will be forced to struggle with this issue without any clear regulatory guidance.
On November 5, 2018, the United States Supreme Court will hear oral arguments on a landmark case regarding the preemptive effect of the Atomic Energy Act of 1954 (the “Atomic Energy Act”) on a state’s regulation of uranium mining. The case, Virginia Uranium Inc. v. Warren, questions whether the Atomic Energy Act’s regulation of radiation safety standards extends to preempt a Virginia state law banning uranium mining within the borders of the state. The Virginia law dates back to the early 1980s, after the largest uranium deposit in the United States was discovered in Pittsylvania County, Virginia. In response to the discovery, the Virginia General Assembly asked the state’s Coal and Energy Commission to evaluate the potential safety effects of uranium mining, and enacted an indefinite ban on mining the deposit. The unharvested deposit is valued at up to $6 billion USD.
In 2007, the owners of the land, Virginia Uranium Inc., Cole Hill LLC and Bowen Minerals LLC, announced their intention to begin mining the deposit. After failing to convince the Virginia legislature to overturn its mining ban, the plaintiffs sought to challenge Virginia’s law as preempted under the Atomic Energy Act.
The Atomic Energy Act gives the federal Nuclear Regulatory Commission the sole power to regulate several steps in the production of nuclear fuel, including setting radiation safety standards for milling uranium ore and disposing of uranium waste byproducts. The Atomic Energy Act does not, however, directly regulate the mining of uranium on non-federal land.
According to the Plaintiffs/Petitioners, the Virginia ban is preempted by the Atomic Energy Act because the purpose and direct effect of Virginia’s law is to regulate radiation safety standards, which the Atomic Energy Act exclusively entrusted to the purview of the Nuclear Regulatory Commission. Predictably, the Virginia legislature has taken a much less expansive view of the law, arguing that the Atomic Energy Act only regulates uranium “after [uranium’s] removal from its place of deposit in nature.” Thus, according to the legislature, a state is free to regulate—or ban—the harvesting of uranium prior to its removal from the deposit.
The eventual resolution of the dispute will not only have a significant impact on the availability of American mined uranium, but may also potentially set the stage for the broader battle over states' rights brewing between the Trump administration and liberal states like California, which have looked to enact environmental laws in areas currently regulated by the federal government.
The Trump Administration has released its Fall 2018 Unified Agenda of Regulatory and Deregulatory Actions. This regulatory agenda “reports on the actions administrative agencies plan to issue in the near and long term [and] demonstrates this Administration’s ongoing commitment to fundamental regulatory reform and a reorientation toward reducing unnecessary regulatory burdens on the American people.”
According to the Trump Administration, the regulatory agenda reflects the following broad regulatory reform priorities:
- Advancing Regulatory Reform
- Public Notice of Regulatory Development
- Consistent Practice across the Federal Government
The EPA-specific regulatory agenda lists 148 regulatory actions in either the proposed rule stage or final rule stage, and provides information about the planned regulatory actions and the timing of those actions. Notable regulatory actions under consideration by EPA include:
- Revised Definition of “Waters of the United State”
- Notice of proposed rulemaking planned for October 2019; final rule planned for September 2019
- Definition of “Waters of the United States”–Recodification of Preexisting Rule
- Final rule planned for March 2019
- Clean Water Act Section 404(c) Regulatory Revision
- Notice of proposed rulemaking planned for June 2019
- National Primary Drinking Water Regulations for Lead and Copper: Regulatory Revisions
- Notice of proposed rulemaking planned for February 2019
- National Primary Drinking Water Regulations: Regulation of Perchlorate
- Notice of proposed rulemaking planned for October 2019; final rule planned for December 2019
- Emission Guidelines for Greenhouse Gas Emissions From Existing Electric Utility Generating Units; Revisions to Emission Guideline Implementing Regulations; Revisions to New Source Review Program (a/k/a The Affordable Clean Energy (ACE) rule to replace the Clean Power Plan)
- Final rule planned for March 2019
- TSCA Chemical Data Reporting Revisions and Small Manufacturer Definition Update for Reporting and Recordkeeping Requirements Under TSCA Section 8(a)
- Notice of proposed rulemaking planned for December 2018; final rule planned for October 2019
More information, and EPA's Statement of Priorities, can be found here.
Under the Trump Administration, EPA has expressed a renewed focus on the Superfund program and making sure that site cleanups operate optimally. In 2017, EPA established a Superfund Task Force, “to provide recommendations for improving and expediting site cleanups and promoting redevelopment.” The Superfund Task Force has made a number of recommendations, including recommending that EPA “Promote the Application of Adaptive Management at Complex Sites” and “Broaden the Use of Adaptive Management (AM) at Superfund Sites.”
According to the Superfund Task Force,
Adaptive Management is an approach used at large and/or complex sites that focuses limited resources on making informed decisions throughout the remedial process…Under an Adaptive Management strategy, Regions are encouraged to consider greater use of early and/or interim actions including use of removal authority or interim remedies, to address immediate risks, prevent source migration, and to return portions of sites to use pending more detailed evaluations on other parts of sites.
The Frank R. Lautenberg Chemical Safety for the 21st Century Act (a/k/a the TSCA Reform Act), signed into law in 2016, was a major overhaul of the 40-year-old chemical law, reforming how new and existing chemicals are evaluated and deemed “safe.” Since the law’s passage, EPA has completed determinations on 1,602 new chemical cases. EPA has also taken action to ban or restrict use of five existing chemicals, including trichloroethylene (TCE) and methylene chloride, which EPA found to pose heightened risks.
EPA has expended considerable resources over the past two year to fulfil these new review and evaluation requirements. EPA has now taken action to pass some of those costs down to the chemical industry in the form of fees authorized by the TSCA Reform Act.
On September 27, 2018, Acting EPA Administrator Wheeler signed the final Fees Rule, setting out the fees EPA will impose on industry to pay for the costly TSCA review process. The final rule will become effective one day after publication in the Federal Register, which is expected to happen in the next few days.
On September 13, 2018, the United States Environmental Protection Agency (“EPA”) took the final, unprecedented step of adding a contaminated site to the Superfund National Priorities List (“NPL”) based solely on the risk to human health posed by indoor air vapor intrusion at the site. The newly designated site, which consists of the former Rockwell International Wheel & Trim facility and its surrounding 76 acres (the “Site”), is located in Grenada, Mississippi. The Site has an extensive history. Beginning in 1966, the Rockwell facility operated as a wheel cover manufacturing and chrome plating plant. After chrome plating operations ceased in 2001, the facility was used for metal stamping until approximately 2007. According to EPA, the Site’s historic operations resulted in multiple releases of trichloroethene, toluene, and hexavalent chromium into the surrounding soil and adjacent wetland. However, EPA’s primary concern—and reason for listing the site—is the potential for airborne volatile organic compounds (“VOCs”) to enter the facility through cracks, joints, and other openings, resulting in contaminated indoor air. The potential for indoor air contamination appears to be of particular concern to EPA, given that nearly 400 individuals currently work within the facility.
The Site will now join a list of approximately 160 contaminated sites that have been federally designated as NPL sites. The NPL includes the nation’s most contaminated and/or dangerous hazardous waste sites. A contaminated site must be added to the NPL to become eligible for federal funding for permanent cleanup under the Comprehensive Environmental Response, Compensation, and Liability Act. While EPA’s decision to list the Site based on risks from indoor air contamination is unprecedented, the move is not all together surprising, given EPA’s recent rulemaking actions. In May 2017, EPA passed a final rule expanding the list of factors the agency is allowed to consider when designating NPL sites to specifically include risks to human health from impacted indoor air. In the preamble to the rule, EPA noted that it needed the authority to list sites on the basis of significant risk to human health from vapor intrusion contamination.
In contrast to EPA’s position, environmental consultants operating at the Site have strongly opposed the NPL designation. Several of the firms submitted comments on the final listing, asserting that EPA’s risk evaluation failed to take into account the Sub Slab Depressurization System (“SSDS”) installed at the facility in 2017, which subsequently reduced levels of VOCs in the indoor air to safe levels. However, EPA rejected these arguments, noting that even though the SSDS may protect workers from immediate threats, “it is not intended to address possible long-term remedial goals such as addressing the sources of the contamination below the building.”
EPA’s designation of the Site should alert potentially responsible parties that vapor intrusion issues may result in an increased chance of a site becoming listed on the NPL. In addition, parties relying on engineering controls to maintain compliant indoor air vapor levels should note the potential for EPA to deem such actions insufficient as long-term site remedies.
United Airlines became the first U.S. airline to publicly commit to reducing its greenhouse gas emissions (GHG) by 50% by 2050. In a press release issued on September 13, 2018, United Airlines explained that it would achieve that reduction by expanding its use of more sustainable biofuels and by relying on more fuel-efficient aircraft and implementing other operational changes to better conserve fuel. United Airlines' commitment to reduce GHG emissions by 50% by 2020 is consistent with reduction targets established by the International Air Transport Association in May 2018.
U.S. EPA has yet to regulate GHG emissions from aircraft in the United States, notwithstanding U.S. EPA’s July 25, 2016 endangerment finding for GHG emissions from aircraft and U.S. EPA’s Advanced Notice of Proposed Rulemaking contemplating adoption of the International Civil Aviation Organization’s (ICAO) aviation carbon emission design standards.
The decision by United Airlines is likely to be followed by other U.S. carriers that have international routes because those carriers will be subject to the ICAO standards when flying internationally.