Category: Environmental Law

New Report Highlights Need for Coordinated and Consistent U.S. Policy to Address Possible Impacts to Financial Stability Due to Climate Change

“Climate change is an emerging threat to the financial stability of the United States.” So begins a recently issued Financial Stability Oversight Council (FSOC) Report, identifying climate change as a financial risk and threat to U.S. financial stability and highlighting a need for coordinated, stable, and clearly communicated policy objectives and actions in order to avoid a disorderly transition to a net-zero economy.

The FSOC’s members are the top regulators of the financial system in the United States, including the heads of the Federal Reserve, the Securities and Exchange Commission (SEC), and the Consumer Financial Protection Bureau. Their charge is to identify risks facing the country’s financial system and respond to them. This new Report supports steps being taken by various financial regulators in the U.S.

The Report suggests four steps necessary to facilitate an orderly transition to a net-zero economy.

  1. Regulators must develop and use better tools to help policymakers. “Council members recognize that the need for better data and tools cannot justify inaction, as climate-related financial risks will become more acute if not addressed promptly.” The FSOC Report highlights the tool of scenario analysis, “a forward-looking projection of risk outcomes that provides a structured approach for considering potential future risks associated with climate change.” The FSOC recommends the use of sector- and economy-wide scenario analysis as particularly important because of the interrelated and unpredictable development of climate impacts and technologies necessary to address them. Each of these technologies may have an unexpected impact on a part of the economy.
  2. Climate-related financial risk data and methodologies for filling gaps must be addressed.  The FSOC Report noted that its members lacked the ability to effectively access and use data that may be present in the financial system. The FSOC Report also noted potential risks to lenders, insurers, infrastructure, and fund managers caused by physical and transitional risks of climate change and the need to develop tools to better understand those risks.
  3. As has been highlighted by the environmental, social, and governance (ESG) movement, disclosure by companies of their climate-related risks is a key piece of data not only for investors but also for regulators and policymakers. Disclosure regimes that promote comparable, consistent, or decision-useful data and impacts of climate change are necessary, according to the Report, and also regimes that cover both public and private entities. The Report highlights various ongoing discussions on this topic, including possible regulations by the SEC.
  4. To assess and mitigate climate-related risks on the financial system, methods of analyzing the interrelated aspects of climate change are necessary. The Report details the developing thoughts around scenario analysis as a tool to help predict the many aspects of climate change on the financial system but notes that clearly defined objectives and planning are essential for decision-useful analysis.

Eliminating Use of PFAS at Airports May Be Harder Than Congress Thought

Per- and polyfluoroalkyl substances (PFAS) are emerging contaminants that are subject to increasing environmental regulation and legislation, including legislation to outright ban their use in certain products. Congress directed the Federal Aviation Administration (FAA) to stop requiring PFAS in the foams used to fight certain fires at commercial airports, and to do so by Oct. 4, 2021. In complying with this order, FAA shows the difficult tightrope it has to walk to meet the “intent” of Congress’ directive, while not really meeting the goal Congress had hoped for.

The FAA issued Certification Alert (CertAlert) 21-05, “Part 139 Extinguishing Agent Requirements,” addressing the continued use of aqueous film-forming foam (AFFF) in order to meet the Oct. 4 deadline. In Section 332 of the FAA Reauthorization Act of 2018, Congress directed that after this date, FAA “…shall not require the use of fluorinated chemicals to meet the performance standards referenced in chapter 6 of AC No: 150/5210–6D and acceptable under 139.319(l) of title 14, Code of Federal Regulations.”

The CertAlert directs airports to continue using AFFF with PFAS unless they can demonstrate another means of compliance with the performance standards stablished by the Department of Defense (DoD) for extinguishing fires at commercial airports. The FAA alert also reminds airports about the need to test their firefighting equipment. Airports can perform the required testing by using a device that has been available since 2019 which does not require the discharge of any foam. Finally, the FAA also reminded airports to comply with state and local requirements for management of foam after it has been discharged.

The FAA reported in its communication that it began constructing a research facility in 2014 that was completed in 2019 and that it has been collaborating with DoD in the search for fluorine-free alternatives for AFFF. The FAA reported that it has tested 15 fluorine-free foams and found that none of them meet the strict DoD performance specifications that also are imposed on commercial airports. More specifically, FAA said the tested alternative foams had the following failings:

  • Increased time to extinguish fires
  • Not as effective at preventing a fire from reigniting
  • Not compatible with the existing firefighting equipment at airports

AFFF was developed to fight fuel fires on aircraft carriers where the ability to suppress fires as rapidly as possible and keep them suppressed is vital to the health and safety of pilots, crews, firefighters and the ship. The military specification (commonly known as MilSpec) for effective firefighting foams for fuel fires is in place for both military and civilian airports.  For many years, the consequences of the use of AFFF to fight aircraft fuel fires – most specifically, the adverse impact on groundwater and surface water – was not fully appreciated. Only recently has this threat been understood and only even more recently has the management of firefighting debris been directly addressed.

Congress may have thought it was eliminating a threat with the legislation directing the FAA to no longer require airports to use AFFF. But FAA’s latest messaging on AFFF highlights just how difficult it is to find suitable replacements, especially when they also have to meet the DoD’s stringent performance standards. The FAA did invite any airport, if they identify a replacement foam that meets the performance standards, to share that discovery with the FAA. However, it is unclear what that would accomplish when it is the DoD and not the FAA that certifies a particular foam’s performance.

In essence, FAA could not solve the challenge that Congress gave it (approve a fluorine-free foam) and instead used the CertAlert to approve airports to use such foams if they can find them on their own. The bottom line is that inadequate progress has been made to fulfill congressional intent to stop using AFFF at commercial airports, and airports are left with no choice but to use PFAS containing foams.

There is legislative activity in many states to ban products with PFAS and at the federal level there have been legislative actions targeting the same – like removing them from MREs. The FAA’s removal of its mandate to use AFFF without offering a PFAS-free alternative is a particularly visible example of the challenge in transitioning away from reliance on PFAS chemicals.

© 2021 BARNES & THORNBURG LLP
For more on travel and transportation, visit the NLR Public Services, Infrastructure, Transportation section.

EPA agreement with Kennedy Center protects water quality of Potomac River, Chesapeake Bay

PHILADELPHIA – The John F. Kennedy Center for the Performing Arts in Washington, D.C. has settled alleged Clean Water Act violations at its facility in Washington, D.C., the U.S. Environmental Protection Agency announced today.

The Kennedy Center, located at 2700 F St NW, has a Clean Water Act permit regulating its discharges of condenser cooling water from the facility’s air conditioning system into the Potomac River, which is part of the Chesapeake Bay watershed.

This settlement addresses alleged violations of temperature and pH discharge permit limits required under the Kennedy Center’s Clean Water Act permit. EPA also cited the Kennedy Center for failing to timely submit monitoring reports and failing to submit pH influent data. Additionally, the agreement addresses alleged violations identified by the District of Columbia’s Department of Energy and Environment during a prior inspection of the facility.

As part of the settlement, the Kennedy Center is required to submit a compliance implementation plan. The Kennedy Center has certified that it is now in compliance with permit requirements.

This agreement is part of EPA’s National Compliance Initiative: Reducing Significant Non-Compliance with National Pollutant Discharge Elimination System (NPDES) Permits. For more information about the Clean Water Act permit program, visit www.epa.gov/npdes.

Read this article in its original. form here.

© Copyright 2021 United States Environmental Protection Agency

Article by the EPA

Read more about the Clean Water Act in the NLR section Energy, Climate, and Environmental Law News.

The End of the Road in Maui?

Late yesterday, Federal Judge Susan Oki Mollway, of the District of Hawaii, ruled that the County of Maui needs a Federal Clean Water Act NPDES permit for its groundwater discharge of treated water from its wastewater treatment facility.

This isn’t the first time the Judge has ruled against the County.  The last time the Court’s decision was revised by the Ninth Circuit Court of Appeals before it was ultimately remanded by the United States Supreme Court for application of its new seven-factor functional equivalence test of whether a discharge to groundwater is within the reach of the Federal Clean Water Act.

Judge Mollway’s decision is the first Federal District Court decision applying the Supreme Court’s functional equivalence test.

The Court’s fifty-page decision on cross-motions for summary judgment finds in the County’s favor with respect to some of those seven factors but concludes that the County’s discharge of treated water is within the reach of the Clean Water Act.

Not mentioned at all in the Court’s decision is an eighth factor enumerated by the United States Environmental Protection Agency after the Supreme Court’s Maui decision — the design and performance of the system or facility from which a pollutant is released.

EPA’s guidance memorandum, issued last January, says that “the composition and concentration of discharges of pollutants directly from a [point source] . . . with little or no intervening treatment or attenuation often differ significantly from the composition and concentration of discharges of pollutants into a system that is engineered, discharged, and operated to treat or attenuate pollutants”.

That didn’t matter at all to Judge Mollway who found such changes both during and after the discharge of treated water from the County’s facility but also found that the treated water was not “devoid of pollutants” and held that the discharge of any pollutants to groundwater is covered by the Clean Water Act when the discharge is “.3 to 1.5 miles” from a Water of the United States and the water containing “pollutants” will take “14 to 16 months on average” to reach the Water of the United States.

I suspect the Ninth Circuit would agree and so this may be the end of the road for the County of Maui. Now EPA and millions of property owners whose discharges to groundwater are not “devoid of pollutants” will need to consider what this first application of the Maui functional equivalence test means for them.

©1994-2021 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved
ARTICLE BY Jeffrey R. Porter of Mintz
For more articles on the CWA, visit the NLR Environmental, Energy & Resources section.

Forced Labor Sanctions in the Solar Industry – What You Need to Know

U.S. Customs and Border Protection (“CBP”) issued a Withhold Release Order (“WRO”) against Hoshine Silicon Industry Co. Ltd. , a company located in China’s Xinjiang Uyghur Autonomous Region (“XUAR”). The WRO has instructed personnel at all U.S. ports of entry to immediately begin to detain shipments containing silica-based products made by Hoshine and its subsidiaries. The WRO applies not only to silica-based products made by Hoshine and its subsidiaries but also to materials and goods derived from or produced using those silica-based products. CBP’s investigations into allegations of forced labor have produced six WROs this fiscal year.

CBP’s move comes the day after the Department of Commerce placed Hoshine and four other companies operating out of the XUAR on its Entity List. The Department imposed a license requirement for all items subject to the Export Administration Regulations (EAR) and a license review policy of case-by-case review for certain Export Control Classification Numbers (ECCNs) and certain items designated as EAR99. The administration made clear at the G7 summit that it would take action to ensure global supply chains are free from the use of forced labor. We noted in March that the Biden administration would use all of the tools at its disposal to combat forced labor, and we continue to expect the pace and scope of enforcement to increase.

Companies in the solar industry should take increasing care to ensure compliance programs are up to date, that new (and current) suppliers are carefully vetted, and supply chain audits are completed to their satisfaction. The State Department has recently noted that the employees of at least one supply chain auditor located in China were detained and interrogated for several days, and that supply chain audit companies are beginning to fear for their employees’ safety. If these allegations are credible, companies sourcing materials from China will need to reevaluate the effectiveness of their compliance programs and diligence procedures and, if they are dissatisfied with the results of their supply chain audits, consider sourcing from elsewhere.

Companies doing business with Hoshine – particularly those who have shipments en-route to U.S. ports – should review their contracts for force majeure and other compliance provisions. Companies should also review their commercial project contracts to determine the impact of supply chain delays and determine compliance with relevant notice provisions. Companies importing silicon of any kind should evaluate whether they have sufficient tracing information to ensure compliance with the WRO. CBP will be on the lookout for potential transshipment attempts by Chinese companies, to try to evade the WRO. If your company acts as an importer of record, it will be held responsible for any such attempt, underscoring the importance of full-spectrum supply chain due diligence for the solar industry.

© 2021 Foley & Lardner LLP
For more articles on the solar industry, visit the NLR Environmental, Energy & Resources section.

Coca-Cola Sued For Deceptive Sustainability Claims

Last week, Coca-Cola was sued by Earth Island Institute for deceptive marketing regarding its sustainability efforts “despite being one of the largest contributors to plastic pollution in the world.”

In the Complaint, Earth Island Institute, a not-for-profit environmental organization, alleges that Coca-Cola is deceiving the public by marketing itself as sustainable and environmentally friendly while “polluting more than any other beverage company and actively working to prevent effective recycling measures in the U.S.” Coca-Cola has developed a number of initiatives to advertise its commitment to plastic waste reduction and recycling, in part through its “Every Bottle Back” and a “World Without Waste” campaigns. It touts its goal to collect and recycle one bottle or can for each one it sells by 2030. Coke also claims that its plastic bottles and caps are designed to be 100% recyclable. The Complaint presents a number of examples of these allegedly misleading statements across a range of mediums, including on its website, in advertising, on social media, and in other corporate reports and statements.

Meanwhile, according to the Complaint, Coca-Cola is the world’s leading plastic waste producer, generating 2.9 million tons of plastic waste per year. It uses about 200,000 plastic bottles per minute, amounting to about one-fifth of the world’s polyethylene terephthalate (PET) bottle output. This plastic production also relies on fossil fuels, resulting in significant CO2 emissions.

This waste generation is complicated by significant deficiencies in recycling. Despite the public’s common understanding that plastic bottles can be recycled, only about 30 percent of them actually are. According to the Complaint, the plastics industry has long understood this problem, but it has sought to convince the consumer that recycling is viable and results in waste reduction. The Complaint even quotes former president of the Plastics Industry Association as saying, “If the public thinks that recycling is working, then they are not going to be as concerned about the environment.”

The Complaint alleges that not only has Coca-Cola failed to implement an effective recycling strategy, it has actively opposed legislation that would improve recycling rates. According to the Complaint, Coke has actively fought against “bottle bills”—laws that would impose a small fee on plastic bottle purchase that would be returned to the consumer when that bottle is returned to a recycling facility. Jurisdictions with these laws tend to have better recycling rates, albeit at a small additional cost to the consumer at the point of purchase.

The Complaint does not allege that Coke has violated any environmental laws. Instead, Earth Island Institute seeks to hold Coke accountable under the Washington, D.C. Consumer Protection Procedures Act. The Complaint alleges that Coca-Cola’s misrepresentations mislead consumers, and that Coke’s products “lack the characteristics, benefits, standards, qualities, or grades” that are stated and implied in its marketing materials. Earth Island Institute does not seek damages; it only seeks to stop Coca-Cola from continuing to make these statements.

This case is the latest example of ESG—Environmental, Social, and Governance—factors playing out in practice.

Copyright © 2021 Robinson & Cole LLP. All rights reserved.
ARTICLE BY Megan Baroni of Robinson & Cole LLP
For more articles on Coca-Cola litigation, visit the NLR Litigation / Trial Practice section.

President Biden’s FY 2022 Budget Request Includes $11.2 Billion For EPA

On May 28, 2021, the Biden-Harris Administration submitted President Joseph Biden’s budget for fiscal year 2022 (FY 2022) to Congress. According to EPA’s May 28, 2021, press release, the budget request advances “key EPA priorities, including tackling climate change, advancing environmental justice, protecting public health, improving infrastructure, creating jobs, and supporting and rebuilding the EPA workforce.” The President’s FY 2022 budget request supports:

  • Rebuilding Infrastructure and Creating Jobs: The budget provides $882 million for the Superfund Remedial program to clean up some of the nation’s most contaminated land, reduce emissions of toxic substances and greenhouse gases (GHG) from existing and abandoned infrastructure, and respond to environmental emergencies, oil spills, and natural disasters;
  • Protecting Public Health: The budget includes $75 million to accelerate toxicity studies and fund research to inform the regulatory developments of designating per- and polyfluoroalkyl substances (PFAS) as hazardous substances while setting enforceable limits for PFAS. In FY 2022, EPA will advance public health by providing an additional $15 million and 87 full-time equivalent employees (FTE) to build agency capacity in managing chemical safety and toxic substances under the Toxic Substances Control Act (TSCA);
  • Tackling the Climate Crisis with the Urgency Science Demands: The FY 2022 budget recognizes the opportunity in tackling the climate crisis by developing the technologies and solutions that will drive new markets and create good paying jobs. The budget restores the Air, Climate, and Energy Research Program and increases base funding by more than $60 million, including $30 million for breakthrough research through the Advanced Research Projects Agency-Climate (ARPA-C) with DOE. The budget provides an additional $6.1 million and 14 FTEs to implement the recently enacted American Innovation and Manufacturing (AIM) Act and reduce potent GHGs while supporting new manufacturing in the United States;
  • Advancing Environmental Justice and Civil Rights: The budget includes more than $900 million in investments for environmental justice-related work, collectively known as EPA’s Accelerating Environmental and Economic Justice Initiative, elevating environmental justice as a top priority across the agency. The budget also proposes a new national program dedicated to environmental justice to further that goal;
  • Supporting States, Tribes, and Regional Offices: Almost half of the total budget, $5.1 billion, will support states, tribes, and localities through the State and Tribal Assistance Grants account;
    • Prioritizing Science and Enhancing the Workforce: The FY 2022 budget includes an increase of 1,026 FTEs “to stop the downward slide in the size of EPA’s workforce in recent years to better meet the mission.” Within this increase are 114 FTEs to propel and expand EPA’s research programs to ensure the agency has the science programs that communities demand from EPA. Also included are 86 additional FTEs to support the criminal and civil enforcement programs to ensure that environmental laws are followed.
    ©2021 Bergeson & Campbell, P.C.
ARTICLE BY Lynn L. Bergeson of Bergeson & Campbell, P.C.
For more articles on the Biden Administration, visit the NLR Administrative & Regulatory section. 

The Need for Speed: Five Drivers Affecting Developments in Climate Action

Current climate action around the globe and in the U.S. signals the very real possibility that efforts to address climate change are not moving fast enough for some. The landmark Dutch court decision ordering Royal Dutch Shell PLC to cut 2019 greenhouse gas emissions levels by 45% by 2030 and the results of recent energy company shareholders’ meetings provide two examples, highlighting that change is in the air. We list five drivers, among many, affecting recent developments in climate action:

1. The Courts – Recent court verdicts are accelerating climate change action at home and abroad. In the U.S. Supreme Court, decisions on climate-related cases lodged by state and local governments are advancing climate issues toward a future Supreme Court ruling on whether climate torts belong in state or federal court. Citing its recent BP PLC et al. v. Mayor and City Council of Baltimore decision, the high court vacated and remanded First, Ninth, and Tenth circuits decisions, to allow for expanded jurisdictional reviews. In the Netherlands, a Dutch court ordered Royal Dutch Shell PLC to cut its greenhouse gas emissions to align with the Paris Agreement. This result could trigger “a wave of climate-related litigation.”

2. The Biden Administration – The Biden Administration’s “whole-of-government” approach to climate change is having an enormous impact. The President’s decision to rejoin to the Paris Agreement sends a message heard around the world that the U.S. is serious about climate change. The Administration’s full court press on climate issues encompasses everything from policies to federal appointees to the Social Cost of Carbon to a sustainable federal supply chain to the acceleration of the electric vehicle transformation.

3. Financial Governance – The Treasury Department’s new climate hub as well as the Securities and Exchange Commission’s anticipated climate-related disclosures requirement reflect the depth and breadth of renewed focus on climate change within the financial sector. Additional emphasis on Environmental, Social, and Governance (ESG) initiatives will include an environmental justice focus.

4. Investors – Climate action affected the latest shareholder votes within the energy industry. ExxonMobil shareholders elected two environmentally conscious directors to the board, while Chevron shareholders pushed the company to cut greenhouse gas emissions. Increasingly, those who finance businesses are getting involved in the climate change battle, as witnessed by Goldman Sachs’ $750B climate commitment, Citibank’s $1.5T sustainability program, and the global banking and insurance industry coalition, Glasgow Finance Alliance for Net Zero.

5. Demographics – It is clear that new voices are entering the climate change debate, with increasing influence. Millennials, Generation Z, and environmental justice communities in general view the climate issue differently than generations past. Industry must account for their perspectives and influence both today and tomorrow.

With these changes in the air, the regulated community will want to consider how to adapt to an accelerating climate change focus.

© 2021 Beveridge & Diamond PC

ARTICLE BY Jennifer J. Leech and Benjamin F. Wilson of Beveridge & Diamond PC

For more articles on climate, visit the NLR Environmental, Energy & Resources section.

Supreme Court to Hear Arguments regarding Natural Gas Act and Eminent Domain Power

On April 28, the Supreme Court will hear oral argument in PennEast Pipeline Co., LLC v. New Jersey et al., No. 19-1039, a case with significant implications for pipeline projects.  The main issue is whether the Natural Gas Act (NGA) delegates the federal government’s eminent domain power to Federal Energy Regulatory Commission (FERC) certificate holders and allows them to sue a state to condemn land in which the state claims an interest, or whether the Eleventh Amendment immunizes states from such lawsuits.

Factual and Legal Background

In 2018, following an extensive application and approval process that included public participation and numerous route modifications, FERC granted PennEast a certificate of public convenience and necessity allowing it to construct and operate a nearly 120-mile natural gas pipeline to transport gas in Pennsylvania and New Jersey.

The state of New Jersey has an interest in several properties in the pipeline’s approved route.  Section 717f(h) of the NGA provides that when any holder of a public convenience and necessity certificate cannot obtain by negotiation or contract the necessary rights-of-way to construct, operate, and maintain an interstate pipeline, it “may acquire the same by the exercise of the right of eminent domain” in federal district court.  Under that provision, PennEast brought several in rem actions against New Jersey in district court to establish just compensation and obtain by condemnation the rights-of-way that it had been unable to obtain.

New Jersey moved to dismiss, asserting Eleventh Amendment sovereign immunity from the suit.  The district court rejected New Jersey’s argument and granted the condemnation orders.  However, the Third Circuit disagreed, and vacated the district court’s ruling.  The Third Circuit expressed doubt that the United States can delegate to a private party the federal government’s exemption from Eleventh Amendment immunity that allows it to sue states.  The Third Circuit likened such delegation to an abrogation of sovereign immunity, which Congress can accomplish only through certain federal powers.  Regardless, the court held, the federal government’s eminent domain power and its exemption from state sovereign immunity “are separate and distinct,” and Section 717f(h) delegates only the former, not the latter.

The Third Circuit noted that its “holding may disrupt how the natural gas industry, which has used the NGA to construct interstate pipelines over State-owned land for the past eighty years, operates.” The Third Circuit stated that as “a work-around,” eminent domain actions could be filed by some “accountable federal official.” On January 30, 2020, in response to PennEast’s petition for a declaratory order interpreting the Third Circuit’s decision, FERC issued an order “confirm[ing its] strong belief in” the correctness of PennEast’s position.  FERC also disclaimed the authority to file condemnation actions itself, in place of natural gas companies.

On February 3, 2021, the Supreme Court granted PennEast’s petition for a writ of certiorari.  In addition, the Court instructed the parties to brief and argue a second issue—whether the Third Circuit properly exercised jurisdiction over the case.

Eleventh Amendment Arguments

New Jersey argues that the federal government cannot delegate its exemption from state sovereign immunity to allow private parties to bring condemnation suits against states, but even if it could, Congress did not clearly do so through the text of the NGA.  Thus, New Jersey asserts that the Court “need not conclusively resolve the constitutional question” because the text of the NGA disposes of the issue presented.

By contrast, PennEast asserts that the NGA’s delegation of the federal government’s eminent domain power necessarily includes the ability to sue states.  Concluding otherwise, PennEast argues, would overlook the history of eminent domain proceedings and the fact that Section 717f(h) includes no exception for state-owned properties.  It would also frustrate the NGA’s fundamental purpose of facilitating interstate pipelines.  PennEast also emphasizes that the condemnation actions are in rem proceedings that do not implicate the same state sovereign immunity concerns that in personam suits implicate.  Finally, PennEast argues that the Third Circuit’s decision “not only gives states a veto power over federally approved pipelines but creates gravely misaligned incentives, as a private property owner seeking to preclude construction of a pipeline could do so by granting an easement to a state that shares its opposition.”

A coalition of 19 states—including some facing potential suits regarding pipeline projects—filed an amicus brief in support of New Jersey, primarily based on “the constitutional questions that undergird [New Jersey’s] statutory analysis.”  PennEast’s argument on the merits is supported by numerous industry amici and the federal government.  Those industry amici argue that the Third Circuit’s decision will have significant negative impacts on the industry’s ability to reliably supply the country with affordable natural gas.  Similarly, the federal government has emphasized that an affordable and reliable interstate natural gas supply is a general purpose of the NGA, which the Third Circuit’s decision threatens.

Other Jurisdictional Arguments

In June 2020, the Supreme Court invited the Solicitor General to file a brief expressing the United States’ views on the certiorari petition.  The United States subsequently filed a brief characterizing the case as a “collateral attack on [PennEast’s] authority to execute the terms of the FERC-issued certificate.”  It, therefore, argued that the lower courts lacked jurisdiction to entertain the case because Section 717r(b) of the NGA vests exclusive jurisdiction for direct review of the certificate in the D.C. Circuit or the circuit in which the certificate-holder has its principal place of business.

PennEast and New Jersey both argue that the lower courts properly exercised jurisdiction; neither party understands New Jersey’s Eleventh Amendment challenge as a collateral attack on the FERC certificate.

***

The Supreme Court is expected to return a decision before the term ends in late June.

Copyright © 2021, Hunton Andrews Kurth LLP. All Rights Reserved.

ARTICLE BY Kate Perkins of Hunton Andrews Kurth
For more articles on SCOTUS, visit the NLR Litigation / Trial Practice section.

Expectations for Offshore Wind Under the Biden Administration

President Joe Biden’s arrival at the White House in January was, as customary for any new executive branch leader, met by outsized expectations on the part of supporters and detractors alike. Among the countless areas of public policy set to be affected by the new administration, perhaps no one issue is more anticipated to be in play than energy and environmental policy.

The heightened set of expectations around energy policy began with the campaign, when Team Biden consistently placed climate change issues among its leading priorities — a trend that noticeably continued with Cabinet picks, as nominees for agencies from Defense to Transportation to Treasury cited climate considerations as key factors affecting their respective portfolios. On January 27, 2021, shortly after taking office, the Biden administration released a series of executive actions that included a stated goal of reaching a “carbon pollution-free power sector by 2035.”

Perhaps no single industry would be more critical to the realization of this far-reaching carbon-free goal than offshore wind, which has emerged in the United States over the past several years as a potentially game-changing source of clean energy generation, based on its earlier-moving success in Europe and elsewhere. In fact, along the country’s populous coastal areas, where fifty three percent of US residents reside, offshore wind presents the most viable option to build up renewable energy resources in the foreseeable future.

The industry’s significant upside potential has not been overlooked by the Biden energy team. The same late January set of Executive Orders arrived with a pledge to “identify steps that can be taken to double renewable energy production from offshore wind by 2030.” Energy wonks were quick to note that exactly zero megawatts of wind power are currently generated in US federal waters, where the Department of the Interior (DOI) exerts jurisdiction, making the double production pledge either poorly conceived or remarkably easy to accomplish, depending upon your point of view.

In reality, a significant amount of offshore wind power development is underway in US federal waters today. Some 10 projects with a potential 8000 MWs of output are currently in the pipeline along the east coast, all in need of federal approvals to continue forward. On the US West Coast, significant groundwork at the state and federal levels has been underway for years as part of a concerted push to launch a large-scale offshore wind industry utilizing floating turbine technology already deployed in Europe — a necessity on the West Coast given the sharp drop-off of the continental shelf just a few miles offshore.

Looking forward, here’s what we expect to see from a Biden administration federal policy apparatus that seems determined to maximize the potential of offshore wind in short order:

Federal Permitting: Furthest along in the pipeline, the fate of the 800 MW Vineyard Wind project off the coast of Massachusetts has been widely watched over the past few years. Viewed by many as a bellwether for DOI’s approach to assessing the impacts of offshore wind development, the project appeared to lose momentum in the course of its National Environmental Policy Act (NEPA) review process, unexpectedly finding itself subject to a Supplemental Environmental Impact Statement (SEIS) that would assess “cumulative impacts that could result from the incremental impact of the Proposed Action … combined with past, present, or reasonably foreseeable activities, including other future offshore wind activities.” DOI’s move, based on a lofty forecast of 22 GWs of offshore wind along the East Coast in 10 years, confirmed to many that agency leaders deliberately sought to slow industry growth, even as optimists countered that a successful expanded review process would better insulate the promising industry from future litigation.

The Biden administration has quickly moved to turn the page on Vineyard Wind, announcing a restart of the project’s SEIS (pulled in the waning days of the last administration for fear of a negative outcome) timed to coincide with the debut of newly minted Bureau of Ocean Energy Management (BOEM) head Amanda Lefton, who stated that “robust and timely” permitting would again become regular order. Indeed, only a month later, BOEM followed up by issuing the final EIS for Vineyard Wind. Developers in dire need of predictability should take heart at this early demonstration of timeliness — yet patience will continue to be required as a thinly staffed BOEM makes its way through the significant permit backlog.

Leasing: Beyond timeliness in permitting, the other key federal ingredient needed to instill predictability in the US offshore wind industry involved the issuance of new wind lease areas. For all the aggressive state-level renewables targets that have seeded enthusiasm in offshore wind, little can be done unless the federal government decides to hold lease sales, another action that appeared to be placed on the back burner during the last administration. Currently, developers are eyeing pending lease sales for significant additional acreage in the vicinity of the New York Bight and along the coast of California, both along the central coast at Morro Bay and further north offshore Humboldt County. Under a Biden administration intent on quickly ramping up offshore wind, creating a predictable path forward for development is an obvious priority. Look for release of a predictable, long-range leasing plan for both pending and future offshore wind lease areas as a means to restore investor confidence.

Inter-agency Cooperation: The aforementioned “all-of-government” approach to advancing renewables development stands to find real meaning in relation to offshore wind — starting at the Commerce Department, where the National Oceanic and Atmospheric Administration (NOAA) is housed. The jurisdiction of NOAA’s National Marine Fisheries Service gives the agency significant ongoing contact with commercial fisheries interests, many of whom are skeptical about offshore wind development, allowing it to play an important role in interfacing with fisheries and related stakeholder interests. The Department of Energy (DOE) has a significant role to play in advancing the industry’s future; backing research into new offshore wind technologies suited to US-specific conditions could bolster the potential manufacturing and supply chain benefits linked to the new industry. Finally, the Department of Defense (DOD) has significant say over the early planning process surrounding future wind lease area offerings; its ability to reach agreement on siting decisions in a timely manner is key to an efficient leasing process. Look for empowered climate policy leaders within the White House to enforce cooperation among these and other agencies to help streamline development.

© 2020 Bracewell LLP

ARTICLE BY George D. Felcyn of Bracewell LLP
For more articles on environmental law, visit the NLR Environmental, Energy & Resources section.