Will Evidence of Causality Be Enough to Change EPA’s Mind About the PM2.5 Standard?

There have been numerous studies that support a decrease in the current PM2.5 annual standard of 12 ug/m3.  EPA has nonetheless proposed to retain the current standard on the basis that there is too much uncertainty regarding whether those studies provide a basis for concluding that PM2.5 concentrations below the standard cause increased mortality.  As I have previously noted, the statutory provision requires that NAAQS be set with an “adequate margin of safety.”  That would seem to require EPA to resolve such uncertainty in favor of a more stringent standard.

Putting aside EPA’s interpretation of the statutory requirement, evidence continues to roll in.  Last week, Science Advances published a study which uses causal inference approaches to conclude that lowering the PM2.5 standard to 10 ug/m3 would save more than 143,000 lives over ten years.

Will EPA nonetheless still conclude that the current standard provides an adequate margin of safety?  If I were a betting man, I’d certainly put my money on EPA holding firm.  I will only add that the idea that EPA will not lower the standard just blows my mind.

Perhaps, Some Day, There Will Be a Carbon Tax

There are few people left, at least in my orbit, who don’t share the goal of prompt decarbonization of the economy.  The quaintly named $64,000 question ($64 trillion question?) is how we get from here to there.

Today, the New England Power Generators Association released a report prepared by Analysis Group that explains how an economy-wide price on carbon can help New England do just that.  (Full disclosure:  Foley Hoag has done work for NEPGA and my wife works at Analysis Group, though not on this project.)

As a long-time carbon tax supporter, I did not need to be sold, but the report still has some important conclusions.

  • A carbon price of $25-35/ton in 2025 and $55-70/ton in 2030-35 would be sufficient to put us on a path to meet our GHG reduction targets.
  • Electrification will reduce household energy costs such that, even including the price on carbon, such costs will be lower in 2035 than without electrification.
  • The only means to get on a pathway towards attaining region-wide carbon reduction goals is to combine “high electrification” with carbon pricing.
  • Existing fossil fuel generators will still be necessary for “at least the next one to two decades” for load management.

So, the way to get to a decarbonized economy in New England is to price carbon.  We still have to answer one more question:  how do we build sufficient support for pricing carbon that it becomes a political reality?

Woe Is WOTUS, Redux

Sometimes, history repeats itself.  Sometimes, that is not a good thing.

After the Obama WOTUS rule was promulgated in 2015, the challenges came fast and furious, and in multiple forums.  The Supreme Court, as I put it, adopted the “give me a break” theory over the “just plain nuts” theory, and ruled that challenges to the rule had to be heard in district courts. … More

Particulate Matter Experts Still Think that the PM2.5 NAAQS Should Be Lowered. Will The Courts Defer to Them Or to EPA?

Last week, the New England Journal of Medicine published The Need for a Tighter Particulate-Matter Air-Quality Standard, written by the Independent Particulate Matter Review Panel.  For those who don’t remember, the Review Panel used to be a sub-committee of EPA’s Clean Air Science Advisory Committee, until EPA Administrator Wheeler decided that CASAC did not need the specific advice that the Review Panel had to offer.

The review panel was not deterred.  The NEJM article largely mirrors the report they issued last October, which concluded that the current PM2.5 annual standard is not sufficiently protective.  The authors state that:

The estimated all-cause mortality from long-term exposure to PM2.5, calculated on the basis of the 2015 air quality adjusted to just meet the existing standards, ranges from 13,500 to 52,100 deaths annually.

Their recommendation remains that EPA should lower the standard to between 8 and 10 ug/m3, although they note that risks remain even at the low end of that range.

As I’ve noted previously, the relevant statutory provision is that the NAAQS must be requisite to protect public health “with an adequate margin of safety.”  I still don’t understand how EPA can conclude that the current PM2.5 NAAQS complies with the statute, even if there is uncertainty surrounding these mainstream conclusions.  What does “adequate margin of safety” mean other than that EPA must resolve uncertainties in favor of protection of public health?

The article poses this question about judicial review of EPA’s decision to leave the PM2.5 standard unchanged:

Federal courts have in the past given considerable deference to the Clean Air Scientific Advisory Committee regarding its scientific advice. Will the courts defer to a committee that has been arbitrarily and capriciously deprived of a particulate matter–specific expert panel? Or will the courts look elsewhere, such as to public comments from experts and input from the dismissed panel?

I asked the nearly identical question last April, when EPA’s proposal was released.  It remains the question of the day.  How much deference does EPA get when it ignores the recommendation of the overwhelming weight of mainstream science?

Massachusetts AG Petitions DPU to Investigate Gas Industry Future in Light of Commonwealth’s GHG Emissions Goals

On June 4, 2020, the Massachusetts Office of the Attorney General (AGO) filed a petition with the Department of Public Utilities (DPU) requesting that the DPU open an investigation “to assess the future of local gas distribution company (LDC) operations and planning in light of the Commonwealth’s legally binding statewide limit of net-zero greenhouse gas (GHG) emissions by 2050.” Citing Massachusetts’ Global Warming Solutions Act, and the Executive Office of Energy and Environmental Affairs’ Determination of Statewide Emissions Limit for 2020,… More

EPA’s New Cost-Benefit Rule — Are Both Sides Misrepresenting What It Says?

Last week, EPA released its proposed rule regarding Increasing Consistency and Transparency in Considering Benefits and Costs in the Clean Air Act Rulemaking ProcessAs much as I hate to give aid and comfort to this Administration, I have to say that the rule does not herald the end of western civilization.  The biggest controversy surrounding the rule is its impact on consideration of “co-benefits”.  Supporters of the rule are trumpeting its elimination of the consideration of co-benefits.  Opponents are pointing to that very same conclusion as evidence of how wrongheaded the rule is.

There’s only one problem with all the commentary.  I’ve read the rule three times and, as far as I can tell, it does not preclude consideration of co-benefits.  In fact, here’s what the proposed rule does say:

The key elements of a rigorous regulatory BCA include: 1) a statement of need; 2) an examination of regulatory options; and 3) to the extent feasible, an assessment of all benefits and costs of these regulatory options relative to the baseline (no action) scenario. (My emphasis.)

EPA proposes that, to the extent supported by the scientific criteria, as discussed above, as well as practicable in a given rulemaking, (1) BCAs will quantify all benefits; (2) BCAs will monetize all the benefits by following well-defined economic principles using well-established economic methods; and (3) BCAs will qualitatively characterize benefits that cannot be quantified or monetized. (My emphasis.)

So, why does everyone think that the rule would preclude assessment of co-benefits?  This is what the preamble does say:

Disaggregating benefits into those targeted and ancillary to the statutory objective of the regulation may cause the EPA to explore whether there may be more efficient, lawful and defensible, or otherwise appropriate ways of obtaining ancillary benefits, as they may be the primary target of an alternative regulation that may more efficiently address such pollutants, through a more flexible regulatory mechanism, better geographic focus, or other factors. This may be relevant when certain benefits are the result of changes in pollutants that the EPA regulates under a different section of the CAA or under another statute.

And from the proposed rule itself:

The Agency must, to the extent supported by scientific literature as well as practicable in a given rulemaking:

(i) Quantify all benefits.

***

(b) The Agency must provide an additional presentation in the preamble of the public health and welfare benefits that pertain to the specific objective (or objectives, as the case may be) of the CAA provision or provisions under which the rule is promulgated.

(1)This presentation must list the benefit categories arising from the environmental improvement that is targeted by the relevant statutory provision and report the monetized value to society of these benefits.

To me, there’s nothing wrong about this.  Where pollutants are regulated or potentially regulated under multiple programs, double counting (of both costs and benefits) is possible.  Disentangling the effects of one program from another is important.

I understand the concern that this administration will misuse the cost-benefit analysis.  However, I think that this EPA has already demonstrated that it does not need this rule to do so.

If I’ve missed something here, please do let me know.  If you just don’t trust cost-benefit analysis, however, then I don’t need to hear it (and your complaint is not really with this rule, but with 50 years of efforts by presidents of both parties to strengthen cost-benefit analysis).

State Climate Suits Really, Really, Belong in State Court When They Allege Misleading Statements To Investors

On Thursday, there was yet another opinion addressing whether state and local climate suits belong in state or federal court.  This time, Judge William Young issued an opinion explaining his March bench decision to remand Massachusetts’ case against ExxonMobil to state court. 

The Massachusetts case for remand was easier than in the cases seeking a remedy for climate change.  The Massachusetts case does not make nuisance claims or seek a substantive remedy for the impacts of climate change.  It is limited to claims that ExxonMobil deceived investors in Massachusetts by knowingly misrepresenting the science of climate change and the impacts of that science on ExxonMobil’s share price.  As Judge Young noted:

the Commonwealth wants “to hold ExxonMobil accountable for misleading the state’s investors and consumers.” No one doubts that this task falls within the core of a state’s responsibility. States routinely enforce consumer protection and securities laws alongside the federal government.

Contrary to ExxonMobil’s caricature of the complaint, the Commonwealth’s allegations do not require any forays into foreign relations or national energy policy. It alleges only corporate fraud.

Whatever one may think of the merits of the Commonwealth’s claims, or even whether the Commonwealth’s suit was motivated by broader issues related to climate change, Judge Young got this one right.  It’s a consumer fraud case brought under state law and is not subject to removal to federal court based on the allegations in the complaint.

It’s Not Looking Good For Nationwide Permit 12

Yesterday, the 9th Circuit Court of Appeals refused the appellants’ request for a partial stay of the injunction recently issued against use of the Army Corps Nationwide Permit 12 for oil and gas pipeline projects.  The upshot is that use of Nationwide Permit 12 is prohibited for oil and gas pipelines until the Court of Appeals hears and decides the appeal.

The order contains more bad news for the Trump administration, the developers of Keystone XL, and the other energy companies that rely on Nationwide Permit 12.  The Court’s Order wasn’t based simply on the balance of harms.  The Court stated that:

Appellants have not demonstrated a sufficient likelihood of success on the merits and probability of irreparable harm to warrant a stay pending appeal.

That doesn’t bode well.

California Climate Nuisance Cases Will Also Be Heard In State Court (I Think)

The 9th Circuit Court of Appeals has issued two rulings that, combined with the recent 4th Circuit ruling in the Baltimore case, makes it more likely that state and local public nuisance climate cases will be heard in state courts, rather than federal courts.  The two California cases got to the 9th Circuit via different routes.

San Mateo v. Chevron is on all fours with the recent 4th Circuit decision.  As in Baltimore, the defendants in San Mateo removed to federal court, but the federal judge remanded to state court.  The defendants appealed the remand, but the removal statute is very clear that, except in limited circumstances pretty obviously not in play here, even plainly wrong remand orders are not reviewable by courts of appeal.  Moreover, since the 9th Circuit and the 4th Circuit agreed, there is no circuit split to tempt SCOTUS.  Although a circuit split is still possible given pending cases in other circuits, it seems likely that, where a federal judge remands a case to state court, the case will be heard in state court.

City of Oakland was different.  There, the federal judge found that there was federal jurisdiction, refused to remand, and then dismissed under Rule 12.  The 9th Circuit disagreed, concluding that the complaint did not create federal question jurisdiction.  It’s a rather deft decision (joined by a Trump appointee, I feel compelled to note).  The 9th Circuit had already concluded, following the SCOTUS decision in AEP, that there is no federal common law of nuisance to be applied to climate change cases.  As a result, the Court basically hoisted the defendants on their own petard.  If there is no federal common law of nuisance, how can state complaints alleging violations of state nuisance law create federal question jurisdiction?  There’s more to the opinion, but that’s the crux.

Defendants still can hold out some hope.  They had raised a variety of federal question arguments that the district court did not address in its original opinion.  Therefore, the 9th Circuit remanded so that the district court could address them.  Stay tuned for round 2.  In the meantime, the San Mateo case should start moving forward.

Sage Grouse Habitat Still Gets Priority in BLM Leasing Decisions

Last week, Chief Judge Brian Morris of the Federal District Court for the District of Montana vacated an “Instruction Memorandum” issued by BLM in 2018 – and also vacated numerous oil and gas leases issued in reliance on the 2018 IM.  The 2018 IM changed the way BLM interpreted land management plans issued by BLM in 2015 in order to preserve sage grouse habitat, and avoid the necessity for listing the sage grouse as endangered under the ESA.

The short version is that the 2015 plans required BLM to prioritize for leasing land that is not sage grouse habitat.  The 2018 IM required BLM to give priority to land that is not sage grouse habitat only when BLM has a backlog of potential leasing sites to review.  BLM provided no explanation for the change in how it addressed prioritization.  The Court was, of course, aware that the BLM changes resulted from President’s Trump’s drive to expand oil and gas leasing on federal lands.  Its response was short and to the point:

“Faster and easier lease sales,” at the expense of potentially imperiling the habitat of a species on the brink of listing under the ESA, falls short.

Interestingly, given the push by conservatives to decrease the deference given to agency interpretation of their own rules, BLM sought deference to its interpretation of the 2015 plan.  Here, too, the Court gave short shrift to BLM:

Courts do not defer to agency interpretations of a management plan that prove inconsistent with the plain language of the plan.

Finally, and perhaps most importantly, the Court vacated both the IM and the leases, notwithstanding BLM’s request that the Court remand without vacatur.

The Court sees no reason to leave the 2018 IM in place. BLM’s errors undercut the very reason that the 2015 Plans created a priority requirement in the first place and prevent BLM from fulfilling that requirement’s goals. As for the lease sales, the errors here occurred at the beginning of the oil and gas lease sale process, infecting everything that followed.

That paragraph could serve as a fitting epitaph for this Administration’s overall effort to undo the entire environmental regulatory structure put in place since 1970.

Has President Trump Just Limited Enforcement To Willful Violations?

On Tuesday, President Trump issued an Executive Order on Regulatory Relief to Support Economic Recovery.  I’ll leave to others a discussion of the provisions telling agencies to look for more regulations to roll back.  I’m in general agreement with commenters who have said that those provisions don’t add much to Trump’s prior deregulatory efforts and are likely to face mostly the same reception in the courts as prior efforts.

Instead, I want to focus on this provision:

The heads of all agencies shall consider whether to formulate, and make public, policies of enforcement discretion that, as permitted by law and as appropriate in the context of particular statutory and regulatory programs and the policy considerations identified in section 1 of this order, decline enforcement against persons and entities that have attempted in reasonable good faith to comply with applicable statutory and regulatory standards, including those persons and entities acting in conformity with a pre-enforcement ruling.

I hate to give the President too much credit, but this may be the most significant deregulatory measure he’s taken.  As far as I can tell, Trump is telling agencies that they should only take enforcement action against persons who willfully violate environmental laws.  It is true that the President only tells agencies to “consider” policies “consistent with law,” but I think we all know what President Trump means when he tells agencies to consider cutting regulated entities a break.

Because this provision involves the exercise of agency enforcement discretion, it will be much harder to challenge in court.  Certainly, written policies saying that an entire agency will always exercise enforcement discretion to prosecute only willful violations, even in the case of statutes that plainly provide for strict liability, might cause raised eyebrows among judges, but if the agencies actually care about the outcome and draft the policies carefully, they might well withstand judicial review.

My advice to my clients, and I mean this in all seriousness, is pretty simple.  Take steps to carefully document your good faith efforts at compliance – and keep a copy of this EO in your back pocket at all times.

More Evidence About Methane Emissions From Fracking

Earlier this month, I reported on a study showing that methane emissions from Permian Basin fracking operations were quite high.  Since that study acknowledged that there are reasons to think that methane emissions from the Permian Basin may be higher than from fracking elsewhere, it seemed worth noting that an EDF study published last week indicated that methane emissions from oil and gas wells in Pennsylvania (from both fracked wells and conventional wells) are 16 times greater than what has been reported to the Pennsylvania DEP.  That’s a lot of methane.

I don’t know whether these results have been validated.  However, according to EnergyWire (subscription required), “David Spigelmyer, president of the Marcellus Shale Coalition oil and gas industry group, said operators have every incentive to capture and market natural gas, especially in the current, ‘historic’ low price environment.”  That doesn’t sound like a denial to me.  I don’t even understand it.  Don’t operators have more incentive to capture and market methane when prices are high, rather than low?

In any case, the study only reemphasizes my original point – it’s important to accurately account for the life cycle GHG impacts of any kind of product or process, but particularly when the very purpose of the process is to extract GHG.

It’s the Life Cycle Impacts, Stupid

It is generally understood that the shift from coal to gas has helped, at least in the short run, to reduce emissions of greenhouse gases.  It is certainly true that combustion of natural gas releases less CO2 per unit of energy than combustion of coal.  Unfortunately, that’s not the entire answer.  A recent study published in Science Advances indicates that 3.7% of natural gas produced in the Permian Basin ends up in the atmosphere. Given methane’s global warming potential, that’s a significant number.

I don’t know whether further investigation will confirm that number, and methane losses in the Permian Basin may be higher than elsewhere due to the lack of sufficient infrastructure to move the gas to markets.  Regardless, though, the study reminds us that what matters are cumulative impacts, both direct and indirect.  The cost of coal includes the GHG emissions – and other environmental degradation – from mining, as well as from combustion.  Even beneficial technologies aren’t exempt.  Comparisons of electric vehicles to internal combustion vehicles have to include the costs associated with the mining and production of rare earth metals used in electric vehicles.

In other words, it’s all about the life cycle, stupid.  Unfortunately, our environmental protection regulatory system is not organized to provide life cycle analyses.  Impacts are cabined by media-based regulatory requirements.  NEPA and its state analogs are the closest we have to a method to incorporate life cycle assessments.  Unfortunately, anyone who has followed recent litigation to require BOEM and FERC to assess indirect impacts of mineral leases, pipelines, and the like, knows what a blunt instrument NEPA is, even if it’s better than nothing.

I wish I had a solution.  For now, all I can say is that we have to keep doing the science while continuing to work to make government legislation and regulation reflect the knowledge that science provides. That would be, one might say, a breath of fresh air.

EPA’s Science Advisory Committee Policy Fails Judicial Review 101 — Does EPA Even Care?

Earlier this week, the D.C. Circuit Court of Appeals became the latest court to reject EPA’s position that its decision to bar scientists receiving grants from EPA from serving on its advisory panels was not subject to judicial review.  The D.C. Circuit went farther than the First Circuit; it went to the merits and found that EPA’s policy was arbitrary and capricious under the Administrative Procedure Act.

The decision should not come as a surprise.  Once the new EPA policy was found subject to judicial review, the outcome was obvious.  It was not just that EPA’s new policy was unreasonable; it was that EPA provided no reasoned argument at all to justify its rejection of the Office of Government Ethics rules which state that a scientist may obtain agency grants and still provide independent advice to the agency on an advisory panel.

As the Court noted:

although agencies remain “free to change their existing policies,” they still must “provide a reasoned explanation for the change.”

As stupid as I think the new EPA policy is, I believe that I could have created a record that would have allowed the policy to survive judicial review.  That the agency did not do so is only more confirmation of my position that this administration cares more about ammunition for its twitter feed than it does about actually governing.

SCOTUS Gets One Right: Discharges To Groundwater Require Permits, But Only If They Are the Functional Equivalent of a Direct Discharge to Surface Water

The Supreme Court ruled today that discharges to groundwater are subject to the permitting requirements of the Clean Water Act, but only where the “discharge is the functional equivalent of a direct discharge from the point source into navigable waters.”

I don’t often say this about Supreme Court environmental decisions, but I think that the Court got it exactly right.

The apparent dilemma for the Court was that, on one hand, the CWA pretty clearly focuses on surface water discharges, largely leaving groundwater to the states. On the other hand, excluding all groundwater discharges from the CWA would create a massive loophole that could not have been intended by Congress.  Justice Breyer, the Court’s preeminent administrative law scholar, solved it elegantly and simply.

First, he addressed why the CWA must address at least some discharges to groundwater.  As he noted, the “bright line” rule sought by the respondent (and the Trump administration) would allow a person currently discharging to surface waters to cut the pipe off so that the discharge now occurred 10 feet short of surface water, thus avoiding CWA jurisdiction.  Justice Breyer found this untenable.

We do not see how Congress could have intended to create such a large and obvious loophole in one of the key regulatory innovations of the Clean Water Act.

And I love that one of his clerks found a case from 1824

rejecting an interpretation that would facilitate “evasion of the law”.

The other side of the dilemma was how to prevent the loophole without subjecting all or almost all groundwater discharges to CWA coverage.  The 9th Circuit approach was to apply the CWA to any groundwater discharge where the surface water pollution is “fairly traceable” to the groundwater discharge.  This was far too broad for SCOTUS to swallow.  Justice Breyer’s solution?

We hold that the statute requires a permit when there is a direct discharge from a point source into navigable waters or when there is the functional equivalent of a direct discharge.

Why didn’t I think of that?  And for those of you who think that this formulation is too vague, aside from asking rhetorically what would be a better definition, I’ll note that Justice Breyer included a list of seven factors that courts may use in determining whether a groundwater discharge is the functional equivalent of a direct discharge.

Resolving this issue may not be rocket science, but it’s a difficult legal issue that has evaded resolution for years.  Kudos to Justice Breyer for finding a workable middle ground that avoids eviscerating the statute without subjecting untold number of groundwater discharges to CWA jurisdiction.

Well done!