On 19 October, alongside a number of other important strategy documents (over 2,000 pages in total), the UK Government published its ‘Net-Zero Strategy’ (NZS) which will help achieve the UK’s interim five yearly carbon targets leading up to net-zero by 2050.
In December 2020, the UK PM set out an ambitious 10 Point Plan for a green industrial revolution, one of the key points of which was the production of 5 GW of low carbon hydrogen in the UK by 2030. The Plan envisaged hydrogen playing a key role in decarbonising energy-intensive industries and heavy transport and replacing natural gas in domestic heating.
On 17 August the UK Government published its Hydrogen Strategy (together with a number of associated Consultations), which lays the foundations for the UK’s future hydrogen economy and sets out how the UK Government will support innovation and stimulate investment in low carbon hydrogen to meet its 5GW target.
The D.C. Circuit issued a decision in Vecinos para el Bienestar de la Comunidad Costera v. FERC, which faulted FERC for failing to consider whether the social cost of carbon (SCC) is a “generally accepted” analytical tool for assessing the significance of greenhouse gas impacts under NEPA. The decision is likely to result in additional agency engagement of the necessity of the SCC in project reviews, although the decision does not mandate the tool’s use going forward.
As we have described in prior posts, the social cost of carbon is a tool that expresses in dollar amounts the estimated cost to society of a one metric ton increase in CO2 emissions. Developed by a federal interagency working group (IWG) originally to aid cost benefit analysis in rulemaking context, the tool also has potential use in the project approval, by informing agency assessments of environmental impacts under the NEPA. By and large, however, courts have accepted agency decisions not to utilize the SCC in their analysis, often relying on the well-established rule that NEPA generally does not mandate cost-benefit analysis. See 40 C.F.R. 1502.22.
Enter Vecinos, the most recent decision in an evolving area of law. The case concerned FERC approval of liquefied natural gas export terminals and pipelines in Texas. As it has in past projects, FERC quantified the greenhouse gas emissions associated with construction and operation of the facilities, but declined to consider the significance of those effects on the project’s contribution to climate change. The Commission justified this position on the grounds that there is no “universally accepted methodology to attribute discrete, quantifiable, physical effects on the environment to” an individual source’s greenhouse gas emissions. Local residents, environmental groups, and a nearby city challenged, arguing, inter alia, that the Commission was obligated to use the social cost of carbon in light of 40 C.F.R. § 1502.21, a CEQ regulation implementing NEPA which requires agencies to evaluate impacts based on theoretical approaches or research methods “generally accepted in the scientific community” when “information relevant to reasonably foreseeable significant adverse impacts cannot be obtained.”
The D.C. Circuit held that the Commission’s NEPA analysis was inadequate. Its decision regarding the social cost of carbon rests solely on FERC’s failure to consider the potential effect of § 1502.21, which was not discussed or cited in any FERC order or briefing in the case. In so doing, it distinguished an earlier D.C. Circuit decision which had upheld FERC’s decision not to use the social cost of carbon in other projects, which also did not discuss the regulation.
Accordingly, on remand and in the future, FERC and other agencies will have to more directly evaluate the tool and the rigor of the science behind it. Proponents will argue that the social cost of carbon is the kind of “generally accepted” theoretical approach § 1502.21 requires be incorporated into NEPA: The IWG’s SCC framework is at this point over a decade old, and was designed from the start to reflect scientific consensus, incorporating the three most widely cited climate economic impact models, each of which have been extensively peer reviewed. The National Academy of Sciences has recognized the tool and provided recommendations on how to strengthen it, which the Biden Administration is actively working to incorporate through an inclusive public process with stakeholders and experts to ensure that projections are based on the “best available science.”
The decision is the latest in a series of cases assessing the adequacy of FERC’s NEPA analysis. The D.C. Circuit has required that FERC more fully consider the climate consequences of approved projects, particularly the reasonably foreseeable downstream impacts of additional fossil fuel transportation infrastructure, and Vecinos is another push in the same direction. But, as it has in the past, the D.C. Circuit made clear that it was stopping short of forcing the social cost of carbon on FERC. Indeed, the Vecinos court remanded the approval without vacating it, concluding it was “reasonably likely” that the Commission would be able to reach the same result even after discussing § 1502.21, and that vacatur could “needlessly disrupt completion of the projects.” Construction of the facilities continues after the ruling.
Even if Vecinos does not result in broader adoption of the social cost of carbon in project approval, changes from the executive and legislative branches may, for FERC as well as other agencies. By the end of this month, the interagency working group will submit recommendations on “areas of decision-making, budgeting, and procurement” across the federal government where the SCC should be applied, which could include project approval and NEPA analysis. Regarding FERC specifically, President Biden will soon be expected to announce his replacement for Commissioner Neil Chatterjee, potentially shifting the Commission to a Democratic majority and providing additional support to Chairman Glick, who has vocally supported having the Commission consider the significance of greenhouse gas emissions and the social cost of carbon in NEPA analyses.
 Vecinos separately held that the Commission’s environmental justice analysis was arbitrarily limited, as it did not discuss potential disproportionate effects more than two miles away from the project site.
 See EarthReports, Inc. v. FERC, 828 F.3d 949, 956 (D.C. Cir. 2016); see also Appalachian Voices v. FERC, No. 17-1271, 2019 WL 847199 (D.C. Cir. Feb. 19, 2019); Sierra Club. v. FERC, 672 Fed. Appx. 38, 39 (D.C. Cir. 2016).
In wrapping up our three-month long series on the ABCs of the AJP that commenced on Earth Day, we offer some final reflections on the progress and outlook for this monumental public policy initiative. Continue Reading Not Broken, Simply Unfinished – What’s Next for the AJP?
This is the twenty-sixth post in our series on “The ABCs of the AJP.”
As we wrap up our blog series on the climate and energy implications of the Biden Administration’s American Jobs Plan (AJP), it is an opportune moment to revisit our journey from A through Z, and reflect on whether the Biden Administration’s proposed investment in infrastructure can set the nation on a path to achieve its 2050 net-zero target. Continue Reading Zeroing-In on Net-Zero Emissions
On July 14, the European Commission presented its legislative proposal for a Carbon Border Adjustment Mechanism (“CBAM”). This long-anticipated tool is intended to make importers pay for the greenhouse gas (“GHG”) emissions embedded in the covered goods that they market in the EU. A Covington webinar on the main elements of the proposal and related policy considerations is available here. Continue Reading Will the EU CBAM Cover More Than What You Think? Complex Goods, System Boundaries, and Circumvention Under the Commission’s CBAM Proposal
Driven by the entry of renewable generation resources locating far from load centers and the new demands placed on the grid by their differing characteristics, the Federal Energy Regulatory Commission (FERC) launched a comprehensive review of its policies regarding regional transmission planning, interconnection and cost-allocation. In an Advance Notice of Proposed Rulemaking (ANOPR), the agency requested public comments on its current policies and offered potential areas for reform with a view toward anticipated future generation. According to FERC Chairman Richard Glick, “(a) piecemeal approach to expanding the transmission system is not going to get the job done. We must take steps today to build the transmission that tomorrow’s new generation resources will require.” Continue Reading FERC Reviewing Rules for Grid of the Future
The easing of the coronavirus pandemic in the United States, with 67.7% of adults having at least one vaccine shot, provides the Biden Administration’s EPA with a unique opportunity to take stock of its pandemic response and consider any potential policy improvements that could be made. This post focuses on two particular issues: (1) EPA’s regulation of pesticide devices, including in particular indoor air quality-related devices, and (2) treated articles.
The Federal Insecticide, Fungicide, and Rodenticide Act (“FIFRA”) regulates both pesticide devices and pesticides. Pesticide devices operate by physical or mechanical means, and EPA has concluded that ultraviolet (“UV”) lights and various types of air cleaning machines are pesticide devices, if claims to kill microbes or other pests within FIFRA’s jurisdiction are made. Under FIFRA, devices are subject to fewer requirements than pesticides—for example, unlike pesticides, devices are not subject to pre-sale review and approval by EPA. Instead, EPA’s principal substantive regulation of devices is premised on its authority to take action regarding “misbranded” devices. 7 U.S.C. § 136j. EPA interprets the misbranding requirement as mandating that a device be safe and effective for its claimed use and that devices not bear any false or misleading labeling—including efficacy claims that are not adequately substantiated.
While EPA requires sellers of devices to not make false or misleading efficacy claims, EPA has provided little guidance to industry regarding what efficacy data or other substantiation is adequate to support such efficacy claims. Indeed, in an April 12, 2021 letter addressing UV lights, EPA declined to provide detail regarding the type of substantiation it believes is appropriate for UV lights, other than to note that “[i]f claims are made against specific pathogens, EPA maintains that testing of the device against those pathogens on the specific substrate (e.g., E.coli on cloth) is necessary to substantiate those claims.” Likewise, EPA has cautioned consumers about devices claiming to be effective against SARS-CoV-2, but has not provided guidance on what efficacy substantiation is required for such products.
This lack of guidance is in tension with recommendations by public health authorities that such devices may be important tools to combat the pandemic. For example, the CDC has indicated that upper-room UV light systems “can be used to control SARS-CoV-2 as a useful ventilation tool to consider in reducing the spread of infectious pathogens.” Yet an entity marketing such a system would have little guidance as to what type of efficacy data might satisfy EPA, or what data EPA considers necessary to substantiate any given claim.
With the easing of the pandemic, EPA now has an opportunity to consider, in a non-emergency context, whether and how it can provide guidance to both regulated parties and consumers regarding appropriate efficacy claims and substantiation. There may well be significant challenges associated with such guidance, given the different types of devices and the fact that their effectiveness could potentially change depending on the environment in which they are used. Nevertheless, EPA plainly could develop some guidance (e.g., safe harbor specifications, generalized guidance regarding certain efficacy claims and data requirements, efficacy claims it views as impermissible or data it views as unreliable), and nothing prohibits the Agency from doing so after soliciting input from stakeholders via a public notice and comment process.
Treated articles are products that are treated with an EPA-approved antimicrobial pesticide to kill microbes (e.g., a shower curtain treated to resist mildew). Under longstanding EPA regulations and guidance, claims for such treated articles are limited to claims to protect the article itself. 40 C.F.R. § 152.25(a), PR Notice 2000-1. Thus, claims to kill disease-causing bacteria or viruses may not be made in connection with treated articles. Instead, to make such claims, an entity must “register the article as a pesticide product,” which is a lengthy, complex, and costly process. PR Notice 2000-1. Unlike pesticide devices, this class of products is subject to full-blown regulation under FIFRA.
Based on publicly-available information, EPA has registered few, if any, articles with claims to kill disease-causing bacteria or viruses. One of the few examples emerged earlier this year, when EPA announced that certain copper alloys used in hard surfaces (e.g., a doorknob) was the first such product registered to make antiviral claims. EPA has also provided draft guidance for hard-surface antimicrobial coatings. But for many other types of products, EPA has not developed test protocols or other guidance indicating what sort of data (efficacy, safety etc.) would be adequate.
It is not difficult to imagine the potential utility of such products, both now and in any future pandemic—especially a pandemic where surface transmission is a significant disease vector. For example, treatment of high-contact surfaces (e.g., public transit seats, light switches) could potentially provide significant public-health benefits, assuming efficacy, safety, and durability can be ensured.
To be sure, there may be significant challenges and questions associated with developing such products. But that is all the more reason for EPA to implement a process to work through these issues sooner rather than later.
EPA has played a key role in regulating antimicrobial products throughout the SARS-CoV-2 pandemic, and in expediting a variety of approval processes to provide immediate assistance in combatting the pandemic. Now that the pandemic appears to have abated, EPA could consider giving thought to lessons learned from this pandemic, including how to provide a broader suite of antimicrobial tools to combat the next pandemic, while ensuring that those products are in fact safe and effective for use.
This is the twenty-fifth in our series on the “ABCs of the AJP.”
The American Jobs Plan aims to electrify 20% of the country’s iconic yellow school bus fleet through a new “Clean Buses for Kids” program, alongside a broader effort to replace 50,000 diesel transit vehicles. The move will have important health benefits and assist in the electrification of the heavy duty transportation and freight sectors, which face additional challenges as they seek to decarbonize. Continue Reading Yellow School Buses and Diesel Electrification
This is the twenty-fourth in our series, “The ABCs of the AJP.”
In 2020 alone, the United States suffered 22 separate extreme weather and climate-related disasters that each caused at least $1 billion in damages, for a total of more than $100 billion in losses. That staggering statistic is not an anomaly, as climate change continues to result in more and more extreme weather events every year. For example, the Texas freeze that rocked the state earlier this year and killed more than one hundred people, also shut down the state’s significant petrochemical industry, disrupting supply chains nationwide, and caused an estimated $80 billion to $130 billion in direct and indirect economic losses. Hundreds of deaths are attributed to the unprecedented and record-breaking heat wave of the Pacific Northwest, and a British Columbia village where the highest temperature ever recorded in Canada was devastated by wildfire. Taking into account these and other weather-related tragedies, the losses become inestimable on a human scale. Continue Reading X-Treme Weather and the Need for Climate Resiliency