Last week, a number of Democratic Senators filed an amicus brief in Loper Bright Enterprises v. Raimondo, arguing that the Supreme Court should not overrule Chevron.  The first heading under the argument section of the brief is that:

CHEVRON … IS UNDER ATTACK IN THIS CASE BY PRO-CORPORATE SPECIAL INTERESTS

My first point is to ask whether, as a matter of strategy, an argument based on opposing “pro-corporate special interests” is likely to succeed before a SCOTUS that is largely sympathetic to corporate interests.

My second point is to emphasize, as I’ve noted in the past, that Chevron is not a left-right issue.  The Trump administration pursued a number of regulatory initiatives based on statutory interpretations that heavily relied on Chevron deference.

Chevron, at its heart, is not even really about deference to agency interpretation.  The real issue about Chevron is whether Congress has authority to enact statutes that enshrine broad principles, while leaving the Executive Branch to fill in the details.  In other words, the opposition to Chevron is really just a back-door argument about the non-delegation doctrine.  It’s an attack on Congress masquerading as an attack on the deep administrative state.

On September 21, 2023, the Biden administration outlined plans to expand federal agencies’ consideration of the social cost of carbon—a metric for the economic cost of each additional ton of carbon dioxide emitted to the atmosphere. This announcement tilts the balance of cost-benefit analyses in favor of activities that reduce greenhouse gas emissions, and it could have widespread effects for entities that receive federal funding or are subject to federal regulation.… More

Earlier this month, Judge William Young dismissed for lack of standing claims brought by the Conservation Law Foundation alleging that bus companies violated anti-idling regulations.  The opinion is important, because it does not make life easy for citizen plaintiffs and it provides something of a roadmap for defendants to follow in challenging plaintiffs’ standing.

The Court addressed both the injury in fact and traceability requirements.  Because the Court found that plaintiffs could not establish an injury in fact that was traceable to defendants’ conduct, it did not need to reach the redressability criterion.

First, with respect to injury in fact, the Court noted the following:

• The “particularity” requirement means that the harm suffered by the plaintiff must be specific and different in kind than that suffered by the general populace.

• The Court declined to follow other cases in which courts have held that merely breathing contaminated air constitutes injury in fact.

This Court holds that the requirement of an actual injury — one that is concrete and particularized — necessitates more than just breathing in polluted air.  Without any associated physical side effects, recreational or aesthetic harm, or well-grounded fear of health effects, this Court is not satisfied that breathing may constitute an Article III injury.

• The court did find that two CLF members had established injury in fact, through statements that they recreated less due to concerns about air pollution near the defendants’ bus stops.

The real nail in the plaintiffs’ standing coffin was the Court’s conclusion that CLF could not establish that any injuries that its members suffered were in fact traceable to pollution from defendants’ idling buses.

• At bottom, the Court found that CLF had failed “to show a sufficiently direct causal connection between the challenged action and the identified harm.” The CLF members said that they were bothered by vehicle exhaust, but the declarations did not establish that the exhaust that bothered them came from illegally idling buses.

These connections between the members’ injuries and the Bus Companies’ conduct are just too attenuated to satisfy the second prong of the standing inquiry. In an urban environment, a span of a mile or two contains numerous vehicles and bus stops. In such an environment, the injuries alleged cannot be conclusively linked to the excessive idling by the Defendants. Allowing suit against the Defendants for anyone suffering the most minor of injuries who has occasionally traveled within two miles of any bus stop could mean that every resident of the greater Boston area has standing to sue the Bus companies. This Court cannot find that this aligns with the Supreme Court’s guidance on standing.

What’s the lesson here?  At a certain level, it may be simply that size matters. If the defendant is a major stationary source and there’s modeling information about concentrations resulting from the source that are likely impacting potential plaintiffs, it’s going to be easier to establish standing than it was in this case.  Either way, whether you are a potential plaintiff or a potential defendant, this case warrants careful reading.

Last week, Inside EPA (subscription required) reported that the Texas Commission on Environmental Quality has basically informed EPA that EPA may not promulgate guidance on cumulative risk assessments because of questions about its legal authority to require CRAs. 

If EPA plans to interpret such environmental regulations as providing EPA with the authority to require that states consider CRAs in its decision making, including CRAs that may include nonchemical stressors, then TCEQ requests that EPA conduct rulemaking to implement regulations applicable to state programs that include CRAs as criteria allowed for consideration in permitting and other regulatory decisions.

Without such rulemaking, TCEQ has no authority to consider CRAs and CIAs in decision making where they are not required in statute or rule. Guidance is non-binding, often not media-specific, and no substitute for rulemaking, which would provide state agencies with authority to consistently apply CRAs and CIAs in decision making as contemplated by EPA.  (Emphasis added.)

I freely confess from my ivory tower located in deep-blue Massachusetts that I don’t always agree with the TCEQ.  But on this issue, I support TCEQ’s position, at least insofar as it calls for EPA to undertake a rulemaking to implement CRAs.  If EPA believes in the value and importance of cumulative risk assessment, then it should have the courage of its convictions and do a rulemaking.  Because if there’s one thing that’s certain, it’s that, if EPA does promulgate CRA guidance, such guidance will be implemented as though were in effect a binding regulation.

For what it’s worth, I support integrating cumulative risk assessments (and cumulative impact assessments) into federal and state agency decision-making, notwithstanding the difficult methodological issues that need to be resolved to make CRAs a reliable tool. I’m also skeptical that TCEQ would actually support a CRA rulemaking.  I fully expect that TCEQ would challenge a rulemaking, just as they are challenging issuance of guidance.

Still, they’re right about the guidance part!

Last month, Judge John Hunderaker held that the Endangered Species Act requires EPA to consult with the Fish and Wildlife Service and the National Marine Fisheries Service before issuing recommended water quality criteria.  He also vacated EPA’s 2016 chronic freshwater criterion for cadmium.  The case is potentially important for a number of reasons. 

First, it’s a thorough analysis of standing in cases where the plaintiffs claim a procedural injury – here, EPA’s failure to consult with FWS and NMFS before issuing new recommended water quality criteria.

Second, there is an extensive discussion regarding what constitutes agency “action” subject to judicial review.  EPA argued that promulgation of recommended water quality criteria is not an action because it does not dictate what states must do; they are free to promulgate WQC that differ from EPA’s recommendation.

However, as the Court noted repeatedly its opinion, the statute requires states that wish to vary their WQC from EPA’s recommendations to explain the basis for their decision to reject EPA’s recommendation.  That matters, because it imposes costs on states and “nudges” their behavior in the direction of adopting EPA’s recommendations.

And so we come to my real reason for posting about this case.  Without using the words “behavioral economics” or talking about “nudges” or “choice architecture”, the Court made clear that Congress, in enacting what the Court referred to as the “adopt-or-explain requirement”, had established a specific choice architecture for states deciding whether to adopt EPA’s recommended WQC and had purposefully nudged states in the direction of adopting EPA’s recommended WQC.  Moreover, as the Court noted, the nudge works, because states overwhelming choose to adopt EPA’s criteria.

Stakeholders can argue that the statute incorporates much more of a shove than a nudge and can reasonably take the position that Congress shouldn’t be nudging – or shoving – states in that direction.  Regardless, it important to recognize that it is possible in a federal system for Congress to provide incentives to states to take particular actions, while still leaving the ultimate decision to state authorities.

[This post is part of our Hydrogen Blog Series. Read the rest of the series here.]

The Department of Energy (“DOE”) held a webinar on Friday, August 18, 2023 on the U.S. government’s national hydrogen strategy.  The main announcement was the formation of the Hydrogen Interagency Task Force, or “HIT,” but the webinar was otherwise light on details regarding the status of key federal hydrogen programs,… More

Earlier this week, the 10^th Circuit Court of Appeals vacated EPA’s disapproval of Wyoming’s regional haze plan for the PacifiCorp’s Wyodak power plant.  The basis for the disapproval was an issue near and dear to my heart.  In rejecting Wyoming’s SIP, EPA repeatedly pointed to Wyoming’s failure to comply with EPA’s guidelines for determining Best Available Retrofit Technology, even though the guidelines were not enforceable regulations. 

The role of the BART guidelines is a curious one.  Congress required in the Clean Air Act that EPA develop guidelines for determining BART.  Moreover, the CAA provides that, with respect to powerplants with a total capacity great than 750 megawatts, the BART guidelines are binding.  However, Congress did not make the BART guidelines mandatory for facilities below the 750 MW threshold.

To me, that Congress made the BART guidelines binding for large facilities, but not for small facilities, makes it obvious that EPA cannot enforce the guidelines against small facilities.  It’s actually a weaker situation for the enforcement of guidance than if Congress had said nothing at all and EPA had just developed the BART guidelines on its own.

However, EPA did not see it that way, and the 10^th Circuit opinion is replete with citations to EPA’s rule that reflect a conclusion by EPA that the failure to “comply” with the BART guidelines was a fatal flaw in Wyoming’s regional haze SIP.  For example:

In the final rule, the EPA noted that it had “proposed to disapprove the State’s [Wyodak] determination because the State neglected to reasonably assess the costs of compliance and visibility improvement in accordance with the BART Guidelines.”

It is important to note that the decision was not some radical repudiation of EPA authority.  The opinion is in fact quite measured both in its tone and its conclusion:

Certainly, the guidelines are helpful while not binding, and ordinarily no problem presents itself when the EPA references them in reviewing Wyoming’s SIP. The problem arises, however, when the EPA’s rejection of the state’s BART determination—supposedly for unreasonable cost and visibility analyses—is grounded in a strict application of the nonbinding guidelines. The EPA’s final rule confirms that the agency treated the guidelines as binding for Wyodak and disregarded the state’s broad discretion under the Clean Air Act.

Moreover, the Court did not rule that EPA had to accept the Wyoming SIP.  It merely remanded with an order the EPA reconsider the Wyoming SIP, “giving proper deference to the state and without treating the guidelines as binding.”

Sounds reasonable to me.

The case is clearly further grist for my anti-guidance mill.  The evidence is inescapable that, when agencies promulgate guidance – even when with the best intentions – it is inevitable that they will ultimately come to treat the guidance as though it were a binding regulation.  And that’s not how the administrative process is supposed to work.

As more advisory services, investment companies, and public companies have publicized their Environmental, Social, and Governance (ESG) goals, the U.S. Securities and Exchange Commission (SEC) has proposed a set of new rules intended to create a consistent, comparable, and reliable source of information regarding climate change impacts and sustainability efforts to inform and protect investors while facilitating further innovation in this evolving area.

The SEC’s proposed new rules have,… More

Yesterday, the plaintiffs prevailed in the Montana climate litigation.  Time will tell whether the decision will end up being seen as a watershed moment or just a blip.  In trying to answer that question, it does seem worth briefly reviewing what the case was actually about and what the decision says. 

First, it’s important to acknowledge that the decision’s formal reach is limited.  It found unconstitutional and permanently enjoined enforcement of a provision in the Montana Environmental Policy Act that forbids consideration of the impacts of climate change in environmental impact reviews.  The basis for the Court’s decision was straightforward.  Article IX, Section 1, of the Montana Constitution provides that:

(1) The state and each person shall maintain and improve a clean and healthful environment in Montana for present and future generations.

(2) The legislature shall provide for the administration and enforcement of this duty.

(3) The legislature shall provide adequate remedies for the protection of the environmental life support system from degradation and provide adequate remedies to prevent unreasonable depletion and degradation of natural resources.

There are two notable aspects here.  First, while many states have similar constitutional provisions, not all do.  Second, Article IX, Section 1(3) turned out to be very important.  The Court relied on the text of Section 1(3) in concluding that Article IX provides a judicial remedy to enforce the protection of Article IX.  Specifically, section 1(3) rendered unconstitutional efforts by the Montana legislature to preclude litigation challenging the limitation on MEPA review.  Again, some other state constitutions may have similar provisions, but not all do.

Finally, it’s also significant that the Montana Supreme Court had already interpreted Article IX, Section 1, including one decision containing the simple statement that:

MEPA is an essential aspect of the State’s efforts to meet its constitutional obligations.

I’m not a Montana lawyer and I know nothing about the current composition of the Montana Supreme Court, but I will say that, if the Montana Supreme Court has respect for precedent, there’s a very good chance that this decision will be affirmed on appeal.

The more important question is what impact this decision will have on other climate cases.  That’s even more difficult to assess, because the answer depends on subjective factors such as momentum and atmospherics and, dare we say, the weather outside, as much as it depends on state constitutional provisions and jurisprudence.

I’ll only point out, as I’ve written previously, that in the examples of tobacco litigation and gay marriage litigation, the plaintiffs lost case after case until, all of a sudden, they didn’t.  I’m not sure we’re at that tipping point in climate litigation, but that’s the thing about tipping points; they’re really only visible in retrospect.

Greenwire (subscription required) reported this week that the Fish & Wildlife Service Recovery Plan for the Oregon spotted frog estimates that the cost to achieve recovery of the frog will be roughly $2.7 billion over 40 years.  This post isn’t about the Oregon spotted frog or even about the Endangered Species Act as a whole.  (I’ve blogged multiple times about how flawed the NAAQS-setting process is from a cost-benefit point of view.) 

It’s not about whether $2.7 billion is a lot of money to spend on species recovery or whether it will be “worth it” to save the Oregon spotted frog.

It’s about the fact that we don’t even have a way of evaluating whether $2.7 is the right about to spend or whether it’s too little or too much.  I will go out on a limb and say it’s a heck of a lot of money to spend when we don’t know and can’t evaluate whether it’s the right amount.

As regular readers will know, I’m a big believer in cost-benefit analysis.  I acknowledge that the ESA is the poster child for the limitations of cost-benefit analysis.  It’s wicked hard to put a value on saving the Oregon spotted frog.  But nonetheless, if we list it as endangered and we implement a recovery plan that costs $2.7 billion, then we’ve made an implicit decision that it’s worth it to do so.

I sure wish I had a way of knowing whether that’s the right decision or not.  Goldilocks had it easy.

On July 31, 2023, Boston Mayor Michelle Wu signed an executive order ending the use of fossil fuels in new construction and major renovations of city-owned buildings. Although city buildings comprise a small percentage of overall carbon emissions in Boston, the new executive order aligns with larger efforts to decarbonize both publicly and privately owned buildings throughout Boston.

The executive order covers both new city buildings and renovation projects affecting 75% or more of a city building’s square footage.… More

On July 28, 2023, the Council on Environmental Quality (CEQ) proposed reforms to the National Environmental Policy Act (NEPA) regulations governing how federal agencies review the environmental effects of major federal projects. The proposed rules follow amendments to NEPA itself that were enacted in June 2023 through the Fiscal Responsibility Act of 2023, which addressed, among other things, the federal debt ceiling.… More

Earlier this week, the 9^th Circuit Court of Appeals affirmed EPA’s NPDES permit issued to San Francisco’s Oceanside sewer system.  San Francisco had challenged the permit on the ground that EPA does not have authority to impose narrative prohibitions related to compliance with water quality criteria.  Here is the primary section subject to challenge: 

Discharge shall not cause or contribute to a violation of any applicable water quality standard for receiving waters adopted by the Regional Water Board, State Water Resources Control Board (State Water Board), or U.S. EPA as required by the CWA and regulations adopted thereunder.

As EPA pointed out, and as most practitioners are probably aware, provisions such as this are common in NPDES permits.  That doesn’t mean that such provisions are in fact authorized and it’s worth noting that the Court’s decision was not unanimous.  Moreover, while this case does not involve the definition of WOTUS, I think that there are echoes of Justice Alito’s opinion for the Court in its recent decision in Sackett in the objections raised by San Francisco to the NPDES permit here.  San Francisco specifically challenged the narrative criterion as being too vague:

San Francisco argues that EPA’s inclusion of the general narrative prohibitions is inconsistent with the CWA because they are too vague to ensure the city’s control measures will protect water quality.

While the 9^th Circuit disagreed, Justice Alito specifically noted in Sackett that the:

The CWA is a potent weapon. It imposes what have been described as “crushing” consequences “even for inadvertent violations.”

He then went on to state that EPA’s interpretation of the Clean Water Act :

gives rise to serious vagueness concerns in light of the CWA’s criminal penalties. Due process requires Congress to define penal statutes “‘with sufficient definiteness that ordinary people can understand what conduct is prohibited’”.

My initial read was that SCOTUS wouldn’t be interested in reviewing a challenge to an NPDES permit.  However, if SCOTUS feels like taking another shot at the authority of the administrative state, it’s not at all out of the question that it could hear an appeal of this decision.  If it does hear the case, I wouldn’t bet a lot of money that EPA would win the appeal.

The White House Environmental Justice Advisory Council recently weighed in on EPA’s decision whether to lower the National Ambient Air Quality Standards for PM_2.5 and ozone. 

Specifically, with respect to PM_2.5, WHEJAC recommended that the annual primary standard be lowered to 8.0 ug/m³ and the annual daily standard be lowered to 25.0 ug/m³.  Both recommendations are lower than what EPA has proposed.

With respect to the ozone NAAQS, which EPA has proposed remain at 70 parts per billion, WHEJAC recommends that EPA lower the NAAQS to “the low end of the range recommended in the forthcoming review by EPA’s Clean Air Scientific Advisory Committee….”  As I’ve noted previously, CASAC has recommended that the NAAQS be set somewhere in the range of 50-60 ppb.

This administration has paid a lot of attention to EJ and the NAAQS for PM_2.5 and ozone are important EJ issues.  As WHEJAC notes in its letter, both PM_2.5 and ozone disproportionately impact EJ communities.

EPA’s decision on both the PM_2.5 and ozone NAAQS will thus be an important test of the political power of the EJ community.  The economic cost to comply with NAAQS in the ranges recommended by WHEJAC would be substantial.  It is worth noting that WHEJAC stated that:

EPA should finalize the new ozone NAAQS no later than Spring 2024 to ensure maximum durability of the regulation given potential political vulnerabilities.

In other words, WHEJAC wants EPA to finalize stringent NAAQS while EPA is still controlled by a Democratic administration and the Senate is in Democratic hands, thus preventing a legislative rollback under the Congressional Review Act.  On the flip side, as I also previously noted, EPA has indicated that it does not intend to promulgate a new ozone NAAQS until December 2024, after the election, presumably to ensure that EPA’s decision does not become an election issue for the GOP.

Can you say “horns of a dilemma”?  Does the Biden administration timely address EJ concerns – which have significant science behind them – in order to insulate its decision from later Congressional review?  Or does it delay its decision to maximize the likelihood that it will still be around in 2025 and thus able to avoid the inevitable rollback of EJ progress that would follow a GOP victory in 2024?

Politics is a messy business.

I’ve posted previously about the importance of extreme heat among the impacts of climate change.  Much of the popular literature focuses, rightly, on the public health impacts.  Without at all minimizing the public health impacts, I thought it worth noting that there is an increasing scientific literature on the impacts of extreme heat on economic productivity. 

Spoiler alert – the news isn’t good.

“The Effects of Temperature on Labor Productivity” provides a good high-level summary of some of the recent research.  Among the highlights (or lowlights):

• Extreme heat does not only affect agricultural production; it decreases industrial production as well.
• In one study, both agricultural and industrial output decreased by more then 2% with each degree Celsius increase in temperature
• Extreme temperatures affect productivity in both rich and poor countries.

And while the underlying correlation holds true even in the absence of climate change, the magnitude of the impacts is increasing due to climate change.  “Extreme Heat:  The Economic and Social Consequences for the United States” notes that, under baseline conditions, the cost of heat-related productivity losses in the United States may be approximately $100 billion annually, but that, absent effective measures to mitigate the impact of climate change, those costs could be $200 billion by 2030 and $500 billion by 2050.

And that’s just the impact of heat-related productivity losses.  Factor in increases in health care costs and the impacts of hurricanes, flooding, and sea level rise, and, as Senator Everett Dirksen may or may not have said, “pretty soon you’re talking real money.”

For those who still think we can’t afford to the cost of moving to a carbon-free economy, it’s becoming more and more apparent that we may not be able to afford not to do so.