Declaratory Relief in CERCLA Actions

The Ninth Circuit today held that a CERCLA plaintiff that fails to prove liability for recoverable response costs may not obtain declaratory relief for future response costs that it may incur. In City of Colton v. American Promotional Events, Inc., the Ninth Circuit first affirmed summary judgment for defendants on plaintiff's claims for responses costs because plaintiff had admittedly not complied with the National Contingency Plan. The court then held, in a case of first impression in the Ninth Circuit, that plaintiff was not entitled to declaratory relief for future costs.

-Morgan

Ninth Circuit Decides CERCLA Current Owner Issue

In State of California Department of Toxic Substances Control v. Hearthside Residential Corp., the Ninth Circuit answers one of the unanswered questions of CERCLA liability -- is the "current owner" of a CERCLA facility, one of the four categories of responsible parties, the owner at the time a lawsuit is filed, or at some other time? The Ninth Circuit holds that the "current owner" is the owner at the time that response costs are incurred. The decision also provides a very handy statement of the various purposes of CERCLA, and will probably be cited far more for those purposes than for its holding. The decision makes sense, because costs are usually incurred from the time of discovery of a release, and any other rule would create a game of hot potato in which parties have an incentive to transfer the property after discovery of contamination but before a lawsuit is filed. One interesting ramification is that because costs may be incurred over a long period of time, there may be more than one "current owner," and perhaps many.

-Morgan

Draft Cap-and-Trade Regulations

CARB's new very preliminary draft cap-and-trade regulations are now available on CARB's website. The draft regulations have placeholders for many of the most important provisions, such as how allowances will be distributed, how many will be auctioned and how many will be freely distributed. And CARB has not yet made a decision whether to include industrial emitters of less than 25,000 MTCO2e in the initial cap-and-trade phase from 2012 to 2015. CARB's overview summary provides a schedule for the promulgation of the regulations, which are scheduled to go into effect January 1, 2012.

-Morgan

Final GHG Reporting Regulations Published

On October 30, 2009, EPA published its final greenhouse gas reporting regulations in the Federal Register. The regulations are described below in my September 28 post.

-Morgan

District Court Allows Katrina Victims to Pursue Climate Change Lawsuit

In Comer v. Murphy Oil USA, residents along the Gulf Coast filed suit against numerous energy companies claiming defendants' business activities contributed to global warming that contributed to the destruction of their properties during Hurricane Katrina. J. Dennis rules that plaintiffs have standing to assert their public and private nuisance, trespass, and negligence claims, and that none of these claims presents nonjusticiable political questions. But plaintiffs' unjust enrichment, fraudulent misrepresentation, and civil conspiracy claims must be dismissed for prudential standing reasons.

-Morgan Gilhuly and Chris Jensen

New GHG Reporting Requirements

On September 22, 2009, EPA issued final greenhouse gas reporting regulations. The text of the regulations, and some explanatory materials are available here.

In general, the regulations apply to certain industry categories and to generators of more than 25,000 metric tons of CO2 equivalent GHGs. Reporting is, for the most part, based on emissions from a specific facility (not an entire company) but there are exceptions, for example for automobile manufacturers. Certain industry categories (petroleum refineries, cement manufacturing) are required to report regardless of the threshold; other industries that were proposed for inclusion in draft regulations have been exempted (e.g., electronics manufacturing), and agricultural emissions are mostly exempt. Most building owners will not be required to report emissions from boilers and facility equipment because those sources, even for a large building, are unlikely to meet the 25,000 metric ton threshhold. Similarly, virtually all state and local government facilities are likely to fall below the reporting threshhold. EPA estimates that the reporting regulations will cover 85 percent of greenhouse gas emissions from the United States.

Reporting will be required starting January 1, 2010, with the first report due March 31, 2011.

EPA's website has a list of frequently asked questions that help to answer some of the questions about applicability of the regulations, but this rule is just the beginning in what will likely be a more comprehensive set of reporting regulations.

-Morgan

Second Circuit Reinstates States' Nuisance Suits

The Second Circuit has reversed a district court decision and reinstated a nuisance suit, under the federal common law, against electric power providers brought by several states and environmental organizations. A copy of the decision is available here. The Second Circuit panel originally included Justice Sotomayor, but because of her elevation to the Supreme Court the two judges remaining on the panel decided the matter themselves.

-Morgan

New Pew Update to IPCC

And here's a new Pew Center report, updating the IPCC's Fourth Assessment Report on the effects of climate change. There's no good news here.

-Morgan

White House Report on Climate Change

Thirteen federal agencies have published a new report on the impacts from global climate change. The key findings from the report, in very general form, can be found here. This report does not provide a prescription for legislative action, but its factual findings will support proponents of Waxman-Markey and other legislative action.

-Morgan

Scoping Plan

The California Air Resource Board's Climate Change Scoping Plan is available here.

EPA Endangerment Finding

EPA signed proposed endangerment and cause or contribute findings today.  The proposed findings and the technical backup are available here.  A sixty day comment period will begin when the proposed findings are published in the Federal Register.  EPA is also holding two public meetings on the proposed findings.  The west coast meeting will be held in Seattle on May 21.  

--Morgan

More Rumors About An Endangerment Finding

There are more rumors that an endangerment finding for greenhouse gases is imminent. Here's the latest from one of the New York Times' blogs.

-Morgan

Warming costs for California

Here's a summary of the Climate Action Team's latest estimates of the cost of climate change for California: http://www.chicagotribune.com/news/nationworld/sns-ap-climate-change-california,0,4184482.story The final report is due out at the end of March.

New Federal GHG Reporting Rules Announced

Its only March and the new administration is already laying the groundwork to address climate change. EPA proposed a rule today that requires mandatory reporting of greenhouse gas (GHG) emissions from large sources.

The rule would require that suppliers of fossil fuels or industrial greenhouse gases, manufacturers of vehicles and engines, and facilities that emit 25,000 metric tons or more per year of GHG emissions submit annual reports to EPA. The gases covered by the proposed rule are carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFC), perfluorocarbons (PFC), sulfur hexafluoride (SF6), and other fluorinated gases including nitrogen trifluoride (NF3) and hydrofluorinated ethers (HFE).

The preamble to the Rule, which hasn't yet been published in the Federal Register, is at: http://www.epa.gov/climatechange/emissions/downloads/MRRPreamble.pdf

The press release, announcing the rule is at: http://yosemite.epa.gov/opa/admpress.nsf/6424ac1caa800aab85257359003f5337/4bd0e6c514ec1075852575750053e7c0!OpenDocument

-Morgan

The End of California Agriculture?

U.S. Secretary of Energy Steven Chu reportedly said this week that climate change could mean "no more agriculture in California."  While Chu was referring to a worst-case scenario, in which the Sierra snowpack would be reduced by 90 percent, this a stark comment from a cabinet official.  

-Morgan

Futures

According to the Environmental Markets Newsletter, the Chicago Climate Exchange has begun trading in futures that will require, for contracts expiring in 2013 and later, the delivery of greenhouse gas emission allowances that would be usable for compliance with a mandatory U.S. greenhouse gas cap-and-trade program. (If there is no program by then, then other allowances may be delivered.) These contracts allow companies to hedge today against a future cap-and-trade program.

-Morgan

ABA Survey

The American Bar Association is conducting a very brief survey of lawyer attitudes towards the recession. I will be interested in the results if for no other reason than to see how long lawyers as a group think a legal recession will last. If the "wisdom of crowds" research holds true, this collective prediction may be worth reading.

-Morgan

California's Price Tag

The LA Times reports today on a study by two UC Berkeley researchers that puts the annual costs to California from climate change at $300 million to $3.9 billion. About $2.5 trillion of real estate assets in California are subject to threats associated with global warming.

-Morgan

Cap and Trade News

http://www.bloomberg.com/apps/news?pid=20601072&sid=aa8POBVmixHg

California's blueprint to address global warming won't include details of an emissions-trading program as regulators try to build consensus on how best to organize the market-based system.
The California Air Resources Board will begin a rule-writing process after next month's approval of the so-called scoping plan and is seeking outside help from experts to recommend ways to build a cap-and-trade system, said Mary Nichols, chairwoman of the rule- making panel. Under state law, the program must be ready to begin by 2012.

Draft Cap and Trade Legislation

The House Energy and Commerce Committee has released draft cap-and-trade legislation. On the key issue of whether allowances will be allocated by the government or auctioned, the draft legislation incorporates a range of possible alternatives, from mostly allocated to all auctioned. Under the latter scenario, 17.5 percent of the auction proceeds would be used to reduce the federal deficit with the rest distributed to consumers, energy efficiency and greenhouse gas reduction measures, and 0.5 percent for "management" -- federal agency management of the program.

-Morgan