Implementing Maui Remains a Case-by-Case Affair, at Least for Now

Last week, EPA withdrew guidance issued in the waning days of the Trump Administration interpreting the Supreme Court decision in County of Maui v. Hawaii Wildlife FundAs the masochists who follow the torturous case law we call Clean Water Act jurisprudence are well aware, SCOTUS ruled in Maui that discharges from point sources to groundwater that are the “functional equivalent” of a direct discharge to surface water are required to obtain NPDES permits.

SCOTUS outlined seven factors “that may prove relevant (depending upon the circumstances of a particular case).”  Last January, Trump’s EPA issued guidance adding an eighth factor:  “system design and performance.”  I’ll glance over that Trump’s antipathy towards guidance lasted only until he realized how convenient guidance is to the party in power.

EPA’s news release on its withdrawal of the guidance was brief and to the point:

The addition of that factor skewed the “functional equivalent” analysis in a way that could reduce the number of discharges requiring a National Pollutant Discharge Elimination System (NPDES) permit. The agency is rescinding this guidance upon determining that this additional factor is inconsistent with the Clean Water Act and the Supreme Court decision in County of Maui v. Hawaii Wildlife Fund.

I’d put it slightly differently.  The Trump guidance was an awesome combination of irrelevancy and redundancy.  First, the guidance seems largely irrelevant, since the design and performance of a treatment system specify what happens prior to the point source discharge, whereas the focus of the Maui analysis is on what happens between the point source discharge and the affected surface water.  Secondly, to the extent the design and performance of the system are somehow relevant, those impacts would seem to be addressed by the factors identified in Maui.  For example, imagine that there is a facility that will discharge to groundwater and that it would otherwise take one year to reach the surface water, but that the system is designed so that it takes two years (and perhaps that it will reduce the concentrations reaching the surface water).  The time to reach surface water and the change in concentrations over the distance traveled are already factors specified in Maui.  What does the separate consideration of “system design and performance” add to the analysis?

Either way, it does not appear to me that the Trump EPA guidance was an appropriate use of guidance.

The Trump WOTUS Rule Is Vacated; Now We Know What’s Next

Last week, I reported that Judge Rosemary Marquez had vacated the Trump administration’s Navigable Waters Protection Rule.  I also asked “what’s next”?  EPA and the Army Corps have now answered that question, at least for the short run.  In a brief announcement on EPA’s web page, EPA stated that:

the agencies have halted implementation of the Navigable Waters Protection Rule and are interpreting “waters of the United States” consistent with the pre-2015 regulatory regime until further notice.

As a result, the pre-2015 regime applies until EPA and the Corps promulgate what they have promised will be a durable rule that will be based on sound science, survive judicial review, and provide certainty in this long-confused area.  It will also slice and dice, and lead to long-term world peace.

Of course, even before this blessed event comes to pass, if Judge Marquez addresses the plaintiffs’ other claims and strikes down the Trump era rule that repealed the Obama era WOTUS rule, then the Obama rule would come back into force – except that there are several challenges to the Obama rule that would come back to life at that point.

I just love this stuff.  I can’t even think about it without smiling, in a rather bleak, depressed way.

It’s Important to Acknowledge Good News — The End of Leaded Gasoline

As climate change rightly has dominated recent discussions of environmental policy, it’s been easy to forget how much progress has been made in the past fifty years.  I was reminded of the extent of that progress by the story in Bloomberg (subscription required) that the last refinery in the entire world to produce leaded gasoline has ceased operations.  There’s no doubt that that’s something to be celebrated.

I recently did a post asking whether exposure to particulate matter affects cognitive abilities.  Well, there’s no doubt that exposure to lead does so.  The harm wreaked by emissions from leaded gasoline could be described as incalculable.  However, that would be a rhetorical statement.  I’m sure that we could provide at least a rough estimate of the impacts.  If we were to do so, the answer would be terrifying.  The plus side is that the benefit of removing lead from gasoline has therefore also been incalculable.

I’ll close with one final note.  For environmental lawyers, the decision in Ethyl Corp. v. EPA is a foundational case.  At its core, Ethyl Corp. provides the basis for environmental regulation in the face of uncertainty.  And it’s important to remember that, while the decision seems fairly obvious today, it wasn’t so obvious at the time.  The case was decided en banc, and there were multiple dissents.

Imagine the additional harm that would have occurred had Ethyl Corp. been decided the other way.  And now imagine the additional harm that will result from climate change if we fail to regulate because of “uncertainty” about the cause or scope of climate change.

The Trump WOTUS Rule Is Vacated; What’s Next?

Yesterday, Judge Rosemary Marquez vacated the Navigable Waters Protection Rule, the misnomer also known as the Trump WOTUS rule.  In response to this citizens’ suit challenging NWPR, the Biden EPA and Army Corps of Engineers moved to remand the rule to the agencies, since they had already announced an intent to revisit the definition of WOTUS.  However, for reasons that I have never understood, the agencies sought remand without vacatur, notwithstanding their public statements to the effect that implementation of NWPR was already causing harm to waters of the United States.

It turns out that Judge Marquez shares my bewilderment, because it did not take her long to conclude that this case did not fit the criteria for remand without vacatur.

The seriousness of the Agencies’ errors in enacting the NWPR, the likelihood that the Agencies will alter the NWPR’s definition of “waters of the United States,” and the possibility of serious environmental harm if the NWPR remains in place upon remand, all weigh in favor of remand with vacatur.

So NWPR is out.  The next question is “what now”?

The plaintiffs here also challenged the Trump rule that repealed the 2015 Obama WOTUS rule.  If I were a betting man, I’d put my money on Judge Marquez also striking down the repeal rule.  That would revive the Obama WOTUS rule – except that there several legal challenges were filed against the Obama rule.

Oh, what a tangled web the agencies weave when they practice to regulate under an ill-defined statute and a fractured Supreme Court opinion.  I do not see the web getting any less tangled any time in the near future.

NSR Enforcement Lives On (For Now) — A Split Decision for Ameren

The 8th Circuit Court of Appeals has largely affirmed a District Court order finding that Ameren Missouri violated the NSR provisions of the Clean Air Act in making major modifications to its Rush Island facility.  The Appeals Court did reject the District Court’s requirement that Ameren Missouri make improvements at its nearby Labadie facility that was not in violation of the CAA.

I have three thoughts about the decision.

First, the liability finding was pretty much plain vanilla.  I will note, however, that the combination of the decision here and the 3rd Circuit decision in United States v. EME Homer City Generation results in a strong incentive for owners of power plants concerned about NSR liability to sell them quickly, since the courts have clearly landed on an interpretation of the CAA under which former owners are not subject to liability, while current owners (if they were owners at the time of a modification), remain liable.

Second, the 8th Circuit affirmed the injunctive relief imposed by the District Court with respect to the Rush Island facility, but not the requirement imposed by the District Court to reduce emissions at the Ameren Labadie facility to make up for the excess emissions from Rush Island.  When the District Court decision was issued, I praised its carefully crafted injunction and predicted it would survive appeal.

Shows what I know!

I still think that the District Court got it right.  As the 8th Circuit noted (italics in original):

a district court “has the authority to order [a defendant] to take appropriate actions that remedy, mitigate and offset harms to the public and the environment caused by the [defendant’s] proven violations of the CAA.” … [T]he Clean Air Act, 42 U.S.C. § 7413(b), expressly provides for injunctive relief to redress violations of the Act.”

The Court then notes that the Labadie plant didn’t violate the CAA.  However, while the violations occurred at Rush Island, it wasn’t “Rush Island” that violated the CAA.  It was Ameren Missouri that violated the CAA.  There’s nothing in the CAA that precludes the imposition of injunctive relief against a violator with respect to operations separate from those where the violation occurred, as long as they are narrowly tailored to remedying the harm from the violations that did occur.  Here, the District Court made fully supportable findings that the injunctive relief at Labadie would mitigate and offset harms to the public and the environment caused by Ameren Missouri’s proven violations of the CAA.  That should have been enough.

Finally, I have previously described NSR as the most successful program that shouldn’t exist.  I still believe that.  Now, however, as climate change pushes government to adopt programs that will ultimately result in the closure of fossil plants, the NSR program itself is going to become a fossil – or at least extinct.

And that will be a good outcome.

The Sacketts Got Their Day in Court on the Merits; Another Lesson in Being Careful What You Wish For

Last week, in what may or may not be the last round in the ongoing efforts by Michael and Chantell Sackett to build a house on wetlands in Idaho, the 9th Circuit Court of Appeals found that:

EPA reasonably determined that the Sacketts’ property contains wetlands that share a significant nexus with Priest Lake, such that the lot was regulable under the CWA and the relevant regulations.

The history of the case is tortuous, entertaining, and altogether too long even to summarize adequately in a blog post.  Suffice it to say that, after EPA’s rather humiliating defeat before the Supreme Court, and after the passage of seven years, the District Court ruled in EPA’s favor, finding the Sackett’s property was subject to CWA jurisdiction and that the issuance of EPA’s compliance order was not arbitrary and capricious.

The Sacketts appealed, but in the meantime, the Trump EPA withdrew the order and notified the Sacketts that it had no intention of taking any further action against them.  When the Sacketts maintained their appeal, EPA moved to dismiss it as moot.  However, the 9th Circuit concluded that EPA had not met the “heavy burden” required to establish mootness, because the withdrawal of the order was voluntary and not the result of any independent circumstance that would preclude EPA from changing its mind yet again in the future.

With mootness disposed of, the 9th Circuit turned to the merits – which means navigating the craziness environmental lawyers know as Rapanos.  I will confess that I used to find the multiple opinions in Sackett entertaining; now I just want it to go away.  Here, the 9th Circuit had ruled in 2007 that the Kennedy concurrence was the controlling rule of law.  In this recent Sackett decision, the Court decided that there was no reason to revisit that holding.

From there it was fairly easy to conclude that it was not arbitrary and capricious under the “significant nexus” test to find that the Sacketts’ property was subject to CWA jurisdiction.

It seems to me that the Sacketts should have declared victory when EPA withdrew the enforcement order.  They may be hoping to be a test case for SCOTUS, but I’ve never thought that this was a good case on the merits for conservatives to push.  The facts are pretty much an advertisement in support of the significant nexus approach.

Which doesn’t mean that the Supreme Court won’t take the inevitable appeal or that SCOTUS won’t rule in the Sacketts’ favor if they do.

Does Pollution Make You Dumber? (And Other Questions About Exposure to Particulate Matter.)

Most people other than Andrew Wheeler and the Trump Administration Clean Air Science Advisory Committee know that exposure even to low levels of PM2.5 causes increased morbidity and mortality.  And now comes evidence that exposure to PM2.5 may adversely impact cognitive capacity as well.  If the evidence is correct, then the externalities created by activities that release PM2.5 are likely much more significant than we had realized, shifting the cost/benefit analysis even further towards more stringent regulation of particulate exposure.

The recent work is summarized in a fascinating new episode of Freakonomics Radio.  The episode is not just about the impacts of PM2.5 on cognition.  It also includes a discussion of what could be considered early environmental justice impacts of industrialization.  Over the course of the 19th Century, as coal combustion increased dramatically, population shifts occurred, with the result being that, by the end of the 19th Century, poor people came to live in the more heavily polluted areas.  Cause and effect aren’t clear, but the disproportionate impacts seem pretty well established and should be of concern whatever the cause.

As to cognition, let’s just say that the science is not fully developed.  Still, I’ll give the perfect blog teaser to pique your interest.  Freakonomics discusses a study that shows that baseball umpires make more mistakes when the game is played in an area with higher PM2.5 concentrations.  I love this.  Someone actually came up with the idea of studying umpires’ performance to measure the impact of PM2.5 on productivity.

Time will tell whether PM2.5 exposure really does affective cognitive ability.  However, this much I do know – the epidemiological evidence has been pretty much running in one direction:  the more we know about PM2.5, the worse it looks, and the more it seems that stringent regulation of PM2.5 is justified.

Climate Change Is Widespread, Rapid, and Intensifying — And Terrifying

The IPCC has released its Sixth Assessment Report on the physical science basis of climate change.  I would say that it makes sobering reading, except any sane person’s immediate response to AR6 would be to go out and have any number of stiff drinks.  Here are a number of the lowlights:

It is unequivocal that human influence has warmed the atmosphere, ocean and land. Widespread and rapid changes in the atmosphere, ocean, cryosphere and biosphere have occurred.

Global surface temperature has increased faster since 1970 than in any other 50-year period over at least the last 2000 years.

Human-induced climate change is already affecting many weather and climate extremes in every region across the globe.

Global surface temperature will continue to increase until at least the mid-century under all emissions scenarios considered. Global warming of 1.5°C and 2°C will be exceeded during the 21st century unless deep reductions in CO2 and other greenhouse gas emissions occur in the coming decades.

Many changes due to past and future greenhouse gas emissions are irreversible for centuries to millennia, especially changes in the ocean, ice sheets and global sea level.

In the longer term, sea level is committed to rise for centuries to millennia due to continuing deep ocean warming and ice sheet melt, and will remain elevated for thousands of years. (My emphasis.)

Here are my key takeaways from the IPCC:

  • Over time, all of the uncertainties in climate science have resolved towards greater certainty of more significant impacts.  It’s time for the skeptics to stop pointing to uncertainty as an argument against aggressive action.
  • On a more mundane point, I agree with Mike Gerrard (subscription required) that the IPCC now provides sufficient evidence of attribution to have real potential to impact climate change litigation.
  • The increasing pace of climate change might give climate change hawks some well-deserved schadenfreude, since now skeptics will still be alive when the proof is delivered that climate change is real – if it weren’t such an utter disaster for everyone.
  • And finally – the scope of the disaster cannot result in paralysis.  Back to one of my favorite texts:

It is not your responsibility to finish the work of perfecting the world, but you are not free to desist from it either.

Can “Guidance” Ever Be Binding?

Last week, the 9th Circuit Court of Appeals rejected a challenge to EPA guidance that suggested a new statistical method, the Test of Significant Toxicity, for determining the toxicity of discharges subject to NPDES permits.  The Court found that, because it was “nonbinding guidance,” it was not final agency action and was thus not subject to judicial review under the Administrative Procedure Act.

May I ask my legal colleagues to wrap their heads around the concept of “nonbinding guidance?”  Doesn’t the existence of “nonbinding guidance” imply the existing of “binding guidance?”  If not, then the word “nonbinding” would be redundant.  I only wish that it were so.

I’ve ranted on this subject often, I know.  The rant remains valid.  The essence of the problem is that however “nonbinding” the writers of any particular guidance intend it to be, the bureaucrats who implement the guidance can easily convert it into that beautiful misnomer – binding guidance.  And if it’s binding, then it’s a regulation; it’s no longer guidance.

The Court may have gotten this one right.  I’m not sure I agree with the Court’s characterization of EPA’s use of the Guidance here as merely a “mild suggestion,” but it does appear that the TST is not being applied as a ukase.

Still, this case, and others like it, suggest that Courts really need to leave open the possibility of “as applied” challenges to this type of guidance.  If those implementing “nonbinding guidance” treat it as binding, then courts should do so as well – and the formerly “nonbinding guidance” should then be subject to judicial review as final agency action.

FERC Cannot Avoid the Social Cost of Carbon By Arguing That It is Not Universally Accepted

On August 3, the District of Columbia Court of Appeals held that FERC could not avoid use of the social cost of carbon in assessing the impacts of natural gas projects by arguing that “there is no universally accepted methodology.”  Given the growing recognition of the significant role FERC is going to have in combatting climate change, it’s an important decision. 

FERC acknowledged that construction and operation of the projects under review would “contribute incrementally to future climate change impacts.”  However, because of the perceived absence of a “universally accepted methodology”, FERC took the position that “it is not currently possible to determine localized or regional impacts from [greenhouse gas] emissions from the Project.”

However, in so doing, FERC ignored a key provision of the NEPA regulations, which state that:

 [i]f . . . information relevant to reasonably foreseeable significant adverse impacts cannot be obtained . . . because the means to obtain it are not known, the agency shall include within the environmental impact statement . . . [t]he agency’s evaluation of such impacts based upon theoretical approaches or research methods generally accepted in the scientific community.

FERC explained why it did not utilize the SCC in its NEPA analysis.  However, it completely failed to address the NEPA regulatory requirement to use “theoretical approaches or research methods generally accepted in the scientific community.”  That was pretty much the end of the case.  To the Court, the SCC seemed to fit pretty squarely under the regulatory language.  FERC’s complete failure even to discuss the regulation required remand.

The big question is what happens following remand and in other, similar cases.  FERC – or project proponents or GOP state attorneys general – could certainly argue that the SCC is not “generally accepted in the scientific community.”  However, as I have previously noted, even as much as four years ago, a court rejected challenges to use of the SCC in NEPA environmental assessments, noting that “uncertainty” is not the same as “speculation”, and concluding that the presence of uncertainty makes careful environmental assessment even more necessary.  Uncertainty is not an excuse to avoid doing the best job that an agency can to assess environmental impacts – including those related to climate change.

FERC – or project proponents or GOP state attorneys general – could also try to use the Trump administration’s version of the SCC.  It’s unlikely at FERC, since it will soon have a Democratic majority.  I think in any case, the Trump SCC is unlikely to get any traction in implementation of EISs.  However, we still don’t know what a group of Trump-appointed appellate judges will do with EISs based on a significantly higher SCC.

The GOP attorneys general are undoubtedly right about one issue – the value we set on the social cost of carbon matters.  A lot.

Will More Money Managers Start Voting Shares Based on Climate Issues? Fidelity International Gets in the Game

In the wake of Engine No.1’s successful effort to elect more climate-friendly directors at Exxon and the increasingly aggressive action by BlackRock to take climate into account in its investment management decisions, the whole world is watching for further evidence of capitalism’s efforts to save the world from, well, capitalism.

The latest news is from Fidelity International (not to be confused with Fidelity Management and Research), which this week issued its “Sustainable Investing Voting Principles and Guidelines.”

The Guidelines are a mixed bag and I think that reaction to them will depend upon whether one is a glass half-full or glass half-empty type.  Here’s the meat of the climate provisions:

We believe a minimum standard is for companies to provide:

– A stated policy on climate change.

– Emissions data.

– Confirmation of discussion and oversight of climate change at the board level.

In addition, for companies in the most affected industries, we strongly encourage the following:

– Targets for reducing greenhouse emissions.

– Description of the impacts of climate-related risks and opportunities on their businesses, strategy and financial planning.

– Scenario planning including multiple scenarios.

– Impact scenario referencing 1.5°C limits.

For climate hawks, also known as the glass half-empty types, these minimum standards are indeed pretty minimal; they don’t actually require very much from the companies in which Fidelity International invests.  For glass half-full types, the Guidelines are part of a significant trend indicating that capitalism is starting to police itself.

For my own part, I’ve always felt that a glass that is half full is also half empty.  These Guidelines do appear to be part of an increasing trend of shareholder activism on climate, but it’s a trend that going to have to start accelerating pretty quickly if it’s going to result in meaningful action.  And it’s a trend that has to work in concert with legislation and regulation.  It’s a complement to government action, not a substitute for government action.

New York Utility Company Seeks Proposals to Electrify Buildings Instead of Building More Gas Pipelines

On July 12, 2021, in a landmark utility effort to electrify New York City’s building stock, Consolidated Edison (Con Ed) issued a request for proposals (RFP) for non-pipeline solutions (NPS). NPSs avoid the need for investment in pipelines and traditional distribution system infrastructure by meeting on-system natural gas demand with alternative solutions like energy efficiency and heat pumps. Con Ed’s RFP seeks customer-sited load relief solutions that enable the abandonment of leak-prone pipes through full building electrification while maintaining system reliability.… More

Maine, Massachusetts, and Maryland Expand Utility Regulators’ Mandate to Include Climate Considerations, Marking an Emerging Trend by State Legislatures

Maine, Massachusetts, and Maryland all passed legislation this summer that expands the raison d’etre of state utility regulatory bodies to include addressing the impacts of climate change. These efforts mark an emerging trend of legislative bodies directing utility regulators to help advance climate policies. This enhanced vision of utility regulation gives me hope in the fight against climate change.

Despite the fact that utility regulators play a huge role in our energy sector–the sector primarily responsible for historical U.S.… More

Maui Needs a NPDES Permit; What’s Next for WOTUS?

Last week, District Judge Susan Mollway ruled that the County of Maui must obtain a NPDES permit for discharges to groundwater by the Lahaina Wastewater Reclamation Facility.  It is the first trial court decision applying the factors identified by Justice Breyer in the SCOTUS Maui decision. 

Judge Mollway found the most important factors to be what she considered to be the relative short distance from the discharge to the surface water (½ mile) and the relatively short time between the groundwater discharge and the surface water discharge (as little as 84 days and, overall, roughly a year).  Judge Mollway also thought that the sheer volume of the discharge ultimately reaching the surface water is important.

Obviously, ½ mile and one year are still significantly different than the time or distance involved in a discharge direct to surface water.  However, Judge Mollway, effectively put these numbers in context:

Because the Supreme Court knew it was dealing with movement through groundwater, it makes sense to assume that the Court expected the parties to be dealing with transport time measured in months. Notably, the Supreme Court set its extreme at “many years,” not at “many months,” and not even at one year or two years.

I’m confident that Judge Mollway’s analysis comports with the expectation of the SCOTUS majority.  The discharge from the POTW, even though not immediately abutting the shore, was the type of discharge that SCOTUS believed is intended to be encompassed by the NPDES program.

The real question is where do we go from here?  It at least sets a benchmark for other courts to utilize if they so choose.  If you’re less than ½ mile or so from surface water, and it takes less than a year or so for the discharge to reach the surface water – at least if the volume is significant – then it’s plausible to think an NPDES permit may be required.  However, the decision still largely leaves the jurisdictional determination on a case-by-case basis.

More importantly, the decision provides no guidance on the remedy.  What standards should apply?  What effluent limits should be imposed?  I can imagine a facility owner persuasively arguing that its discharge does not cause the exceedance of any water quality criteria, and thus that no effluent limits need be imposed.

In the meantime, what does this mean for legislative efforts to reform the Clean Water Act and efforts by EPA and the Army Corps to develop a workable regulatory definition of WOTUS?

My quick answer is that it will probably have no effect.  I know that experts from both sides of the aisle love to hate Breyer’s opinion.  I may be the only environmental lawyer around who thinks that it was a creative and appropriate effort to solve what has been an insoluble problem.  And I still think that judicial implementation of the SCOTUS opinion may be our best practical hope to get to a workable definition – even if no one’s happy in the meantime.  It’s not as though anyone was happy before the SCOTUS decision.

Three cheers for Judge Mollway.  Let’s see how this plays out.

Will Increased Enforcement Speed Cleanup of Superfund Sites in EJ Communities?

Earlier this month, EPA circulated a memorandum on “Strengthening Environmental Justice Through Cleanup Enforcement Actions.”  It could significantly increase the volume of CERCLA enforcement actions.  More importantly, if implemented appropriately, it could help reduce the risks posed by Superfund sites in overburdened EJ communities. 

The trick of course will indeed be how it’s implemented.  If this becomes just another in a long line of screeds on the subject that all Superfund cleanups take too long, it will accomplish nothing for cleanups in general or EJ communities in particular.  That why, to me, two sentences in the memo are key:

EPA uses mapping and screening tools, including EJSCREEN, in combination with local knowledge to help identify overburdened communities that may be disproportionally impacted by adverse health and environmental effects.

[EPA will] review PRP-lead sites designated as “human exposure not under control” (HENUC) to determine if enforcement actions can effectively reduce human exposure.

In other words, the key to the success of this initiative is EPA’s wise use of data.  Historically, there has been almost no connection (very minor rhetorical exaggeration) between the risk posed by a superfund site and the amount of time and money spent to remediate it.  EPA should be using data to identify the sites that really pose immediate – not just “imminent” – hazards to human health, particularly in overburdened EJ communities.  When it does so, it can focus time and resources on the sites that meet those two criteria and, where necessary, take enforcement action against PRPs who are slow in addressing such significant risks to EJ communities.

If that happens, then EPA can take a bow and I’ll applaud.  However, if in the next six months I hear from an EPA attorney that the Assistant Administrator has told staff that cleanups are just taking too long, then I’ll know that it’s just Superfund business as usual – and that would not be a good result.