On January 6th, the White House Council of Environmental Quality (“CEQ”) released a new Guidance on Consideration of Greenhouse Gas Emissions and Climate Change (“the Guidance”) in permitting decisions, with significant implications for energy and infrastructure projects.  Though this Guidance is effective as of the date of publication, it was issued on an interim basis and CEQ will consider comments until March 10th, after which it could be revised further. 

CEQ’s recommendations will influence the Biden Administration’s analysis of greenhouse gas (“GHG”) emissions in environmental reviews under the National Environmental Policy Act (“NEPA”), applying immediately to all newly proposed actions as well as some on-going NEPA reviews.  While the Guidance is largely framed as a series of recommendations rather than requirements, it highlights best practices for environmental reviews that could help expedite project completions, improve agency decision making, and minimize litigation risks for developers.  Ultimately, CEQ is trying to ensure that agencies and project developers pay sufficient attention to climate impacts, without causing unwarranted delays to agency decision-making, particularly considering that accelerating clean energy infrastructure is a key component of the Biden Admiration’s climate agenda. 

The Guidance seeks to foster a greater understanding of GHG impacts and the tradeoffs among alternatives, thus raising expectations around the quality of federal GHG analyses.  Project developers will want to work closely with federal regulators to ensure the sufficiency of agency NEPA reviews. Failures to do so may provide project opponents a pathway to litigation. 

Continue Reading White House issues guidance on greenhouse gas analysis in permitting decisions

The Federal Energy Regulatory Commission (“FERC”) issued a final rule (Order No. 887) directing the North American Electric Reliability Corporation (“NERC”) to develop new or modified Reliability Standards that require internal network security monitoring (“INSM”) within Critical Infrastructure Protection (“CIP”) networked environments.  This Order may be of interest to entities that develop, implement, or maintain hardware or software for operational technologies associated with bulk electric systems (“BES”).

The forthcoming standards will only apply to certain high- and medium-impact BES Cyber Systems.  The final rule also requires NERC to conduct a feasibility study for implementing similar standards across all other types of BES Cyber Systems.  NERC must propose the new or modified standards within 15 months of the effective date of the final rule, which is 60 days after the date of publication in the Federal Register.  

Continue Reading FERC Orders Development of New Internal Network Security Monitoring Standards

The European Commission is expected to present a Proposal for a Directive on Green Claims  (“Proposed Green Claims Directive” or “the Proposal”) within the next few months.  Together with the Proposal for a Directive empowering consumers for the green transition through better protection against unfair practices and better information (“Consumer Empowerment Directive Proposal”), the Proposed Green Claims Directive would contribute to the EU’s green transition towards a circular, climate-neutral and clean economy by creating a common methodology for the substantiation of green claims that concern the environmental footprint of products, services and companies.  It would aim to reduce greenwashing and enable consumers to take informed purchasing decisions based on reliable information about the sustainability of products and traders.

If adopted, it is likely to significantly limit the environmental claims that businesses can make in the EU/EEA.  Businesses may want to consider approaching the Commission to try to influence the final legislative proposal that it is expected to present by March 2023.  Once the Commission presents its legislative proposal, businesses should consider proposing amendments to the European Parliament and Council. 

Continue Reading Upcoming EU Rules on Green Claims

Congress, the media, and the public have given significant attention to remarks this week by a commissioner of the Consumer Product Safety Commission (“CPSC”) indicating that the agency would be considering a federal ban on gas stoves due to their health effects.  The suggestion of a ban on gas stoves has drawn comments from bipartisan policymakers in both chambers, and even the White House has weighed in against the prospect of a potential ban.

The CPSC is unlikely to ban gas stoves in the near future, although it has the authority to ban unreasonably dangerous products that cannot be made safe, and has done so with toxic substances in children’s products and other product categories in the past.   A CPSC rulemaking on mandatory safety standards for gas stoves, however, is a possibility, and that process may drive the establishment of voluntary industry standards by a standards-setting body.  Additionally, other federal and state regulators have recently sharpened their focus on indoor air quality and gas-powered appliances, for both health and environmental reasons.  The Environmental Protection Agency (“EPA”), for instance, is undertaking several activities related to indoor air quality.  And the California Air Resources Board (“CARB”) recently adopted a plan that would effectively prohibit the sale of gas-powered space and water heaters in California by 2030.

Particularly with regard to federal regulatory activity on gas stoves and other gas-powered appliances, potentially affected parties will have ample opportunities to help shape the outcome of any mandatory or voluntary product standards put in place or accepted by the CPSC, and to engage with other regulators.  This alert provides an overview of recent and emerging legislative and regulatory activity related to indoor air pollution, focusing particularly on activity by the CPSC and EPA.  Companies—both those with interests in gas stoves and those concerned with indoor air quality issues more broadly—should carefully follow indoor air quality developments, including in their interactions with regulators, given the increased focus on this area.

Continue Reading A Growing Focus on Indoor Air Quality by Regulators and Policymakers

Notice 2023-9, “Section 45W Commercial Clean Vehicles and Incremental Cost for 2023”

Concurrent with the white paper and Notice 2023-1, discussed in a separate blog, on December 29, 2022, the IRS released Notice 2023-9, which provides a safe harbor for determining the incremental cost of qualified commercial clean vehicles for the section 45W credit.

Continue Reading Treasury and the IRS provide a safe harbor for determining the incremental cost of a clean vehicle for the commercial clean vehicle credit

On December 29, 2022, Treasury released a white paper indicating the anticipated direction of proposed guidance on the critical mineral and battery component requirements for the new clean vehicle credit under section 30D. Treasury intends to publish proposed guidance in March 2023, and after its publication, the section 30D credit will be available only if a vehicle satisfies one of these requirements ($3,750 for satisfying one requirement and $7,500 for satisfying both requirements).  

In addition to the white paper, the IRS issued Notice 2023-1 which provides proposed definitions of certain terms relevant for the section 30D credit.

Continue Reading Treasury and the IRS provide its first set of proposed guidance and a white paper on the clean vehicle credit

The Greenhouse Gas Protocol (“GHG Protocol” or “Protocol”)—a leading standard setter for measuring and managing corporate greenhouse gas emissions, borne of a partnership between World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD)—has opened stakeholder surveys concerning the revision of its Corporate Accounting and Reporting Standard, Guidance on Scope 2 Emissions, and the Scope 3 Standard and Scope 3 Calculation Guidance.

Continue Reading Corporate Carbon Counting Under Scrutiny—Comments Requested on Pending Updates to the Greenhouse Gas Protocol

On August 16, 2022, President Biden signed the Inflation Reduction Act (IRA) into law, directing a record $370 billion toward clean energy investments.

Yesterday, the White House released a 182-page guidebook to the IRA entitled Building a Clean Economy.  John Podesta, Senior Advisor to the President for Clean Energy Innovation and Implementation, explains in his introduction that the guidebook “provides a program-by-program overview of the Inflation Reduction Act, including who is eligible to apply for funding and for what purposes.”  In the coming weeks and months, the Administration will provide further updates on www.CleanEnergy.gov.

See here for our post providing an overview of the major energy provisions in the IRA.

On December 14, 2022, during an open Commission meeting, the Federal Trade Commission voted unanimously to issue a Federal Register notice requesting comments on the efficacy of the Green Guides.  The initial request for comments seeks input on whether to retain, modify, or rescind the Guides.  The notice was published in late December, marking the beginning of a 60-day comment period that ends on February 21, 2023.

Continue Reading FTC Launches Green Guides Review, 60-day Comment Period Closes February 2023

Today, the IRS released Revenue Procedure 2022-42 to address the reporting requirements for vehicle manufacturers and sellers.  These reporting requirements are prerequisites for purchasers’ eligibility for clean vehicle tax credits under Sections 25E, 30D, and 45W.  Section 30D(d)(3) requires that a manufacturer enter into a written agreement to become a qualified manufacturer, which requires periodic written reports to the IRS.  Similarly, Section 30D(1)(H) requires that the person who sells a vehicle furnish a report to purchasers and the IRS.

Continue Reading IRS Releases Reporting Requirements to Determine Eligibility for Clean Vehicle Tax Credits