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Entries in EPA (3)

Monday
Aug102015

Supreme Court Tells EPA Cost Does Matter

Litigation Los AngelesEnvironmental Litigation  

Stephen T. Holzer
818.907.3299

 

The Environmental Protection Agency's Mercury and Air Toxics Standards (MATS) placed national limits on mercury and other toxic emissions from power plants. The agency projected MATS to prevent 11,000 premature deaths, 4,700 heart attacks and 130,000 asthma attacks each year.

What the EPA didn't project, however, was the cost effectiveness of enforcing MATS.

Twenty-three states and other petitioners challenged the Agency's refusal to consider costs of emissions reduction in a Washington D.C. circuit court, which sided with the EPA, then again at a D.C. Appellate Court which upheld the lower court's decision. But in June, the U.S. Supreme Court (SCOTUS) sided with the petitioners in Michigan v. Environmental Protection Agency, and remanded the case back to the Court of Appeals to reconsider its decision in light of SCOTUS guidance.

Mercury Cleanup Costs

The central question in this case pertains to the federal Clean Air Act, as amended in 1990. One of the amendments directs the EPA to study public health hazards caused by power plant emissions and to determine whether or not these facilities should be subject to regulation. The Agency must then decree certain floor standards for emissions based on the type of facility in question and on the top-performing 12 percent of those facilities in the category. Section 7412(d)(2) of the Act clearly directs the EPA to consider the costs of reducing emissions.

In 2000 the EPA concluded coal and oil burning power plants need regulation, and reaffirmed this decision in 2012. It issued a Regulatory Impact Analysis, estimating costs of regulation at $9.6 billion per year for the power plants, but did not fully estimate the benefits of emission reduction, which it estimated at $4-6 million.

The EPA found collateral benefits for regulation of the power plants, which would reduce particulate matter and sulfur dioxide in emissions. The Regulatory Impact Analysis estimated those benefits to fall between $37 and $90 billion per year – but these substances aren't covered under the Clean Air Act, and the Agency did not base its decree for regulation on these additional benefits.

SCOTUS's 5-4 Opinion

The Supreme Court's close decision centered on the sometimes ambiguous, yet sometimes particular, wording of the Clean Air Act. On the ambiguous side, §7412(n)(1)(A):

Congress instructed EPA to add power plants to the program if (but only if) the Agency finds regulation "appropriate and necessary"…. One would not say that it is rational, never mind "appropriate," to impose billions of dollars in economic costs in return for a few dollars in health or environmental benefits.

More to the point, SCOTUS cited this:

Congress called for two additional studies. One of them, a study into mercury emissions from power plants and other sources, must consider “the health and environmental effects of such emissions, technologies which are available to control such emissions, and the costs of such technologies.” §7412(n)(1)(B).

The EPA made several arguments, one being that the Agency shouldn't have to consider cost when first deciding whether to regulate power plants – costs become a factor in deciding how much regulation is necessary. SCOTUS responded, "By EPA’s logic, someone could decide whether it is “appropriate” to buy a Ferrari without thinking about cost, because he plans to think about cost later when deciding whether to upgrade the sound system."

Respondents in Michigan asked the Court to consider the potentially $90 billion in collateral benefits EPA published in the Regulatory Impact Analysis, but SCOTUS refused to do so, saying the Court could only consider the "grounds on which the agency acted."

Significance

Court analysts can and will draw various lessons from the SCOTUS decision.

First, some will argue that this shows the Court majority is returning to a literal reading of statutes and following that literal approach despite policy arguments that administrative flexibility is needed (the above quote from the Clean Air Act says EPA must consider “the costs of such technologies”). However, it is arguably hard to square such a broad conclusion after the Court, in a majority opinion by Chief Justice Roberts, virtually admitted one could, for policy reasons, ignore the plain language of the Affordable Care Act stating that subsidies would only be available for an exchange set up by “the states”, not the federal government.

Perhaps a more accurate interpretation of the approach is that the Court’s conservative majority has decided the Court has historically given substantial deference to EPA and the agency needs a shot across the bow to force the agency to proceed more cautiously, and not assume it can count on such judicial deference in the future.

Yet perhaps a third conclusion is simply that the Court is severely split, roughly 5-4, between conservatives and liberals. The decisions referenced above were decided by one or two votes, with a conservative Justice or two occasionally swinging over to vote with the liberals.

Whatever the analysis, it does seem that EPA regulation may have entered a new era in which more restrictions are placed upon the agency’s scope of action.

 

Stephen T. Holzer is the Chair of our Environmental Practice Group and a business litigation attorney. Contact him by phone: 818.907.3299, or by email: sholzer@lewitthackman.com.

 

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

Friday
Feb082013

Hydraulic Fracking in California - This Means War

Litigation Los AngelesEnvironmental Litigation  

Stephen T. Holzer
818.907.3299

 

Environmental Defense

 

 

Here comes the boom: If someone told you that California could become the next Texas in terms of oil production, how would you react?

Do you envision barren tracts of land featuring nothing but the mechanical bob of pump jacks? Or do you picture thriving cities and an end to the state budget crisis?

It's these conflicting images that may very well spark the next great political wars, as the oil and gas industries face off with environmental watch groups over what's known as hydraulic fracturing, or fracking. The likely battleground is Monterey Shale – a stretch of rock formation lying between Los Angeles and San Francisco, which potentially holds 15.4 billion barrels of oil, according to the United States Energy Information Administration.

That's a lot of crude – adding about two thirds more to the national oil reserve, in fact.

 

California Fracking: Frightening Consequences or Financial Boon?

 

For the environmentalists, drilling is bad enough.

But fracking means injecting fluid, sand and chemicals to open up cracks in the shale, which allow more natural resources to flow into oil and gas wells.

The oil and gas industries have been fracking in California for decades, but a recent boom in technology now allows companies to drill horizontally, targeting very specific areas for the injection technique. With less guesswork involved, speculators are moving in. The environmentalists are on heightened watch. 

State and national green groups claim hydraulic fracturing may pose risks to ground water, air quality and seismic stability, citing problems in Pennsylvania where fracking for natural gas has caused some concern.

Environmental Defense Lawyer - Fracking

Earthjustice, representing four environmental plaintiffs, filed a suit in October against the California Department of Conservation Division of Oil, Gas and Geothermal Resources (DOGGR) for insufficient evaluation of fracking risks. The Center for Biological Diversity filed another complaint against DOGGR in January, claiming the Department issued permits for fracking-related oil and gas well operations without tracking, monitoring or supervising the high-risk practice.

However, a recent study by Plains Exploration & Production Co., owner of the Inglewood oil field, found that hydraulic fracturing of two test wells here in Los Angeles posed no threats to either groundwater or air quality, and did not induce seismic activity.

 

Expect Fracking Complications

 

As the environmentalists demand oversight to deal with land, water and air safety, oil and gas companies will fight back.

One of the issues they're already voicing is that of trade secret protection. The industry seems to be willing to disclose the identity and nature of the chemicals used in fracking to a certain point – but not enough to risk the years of investment they've made to perfect their new technology. It will be interesting to watch how all of this plays out in California courts over the coming year.

In the meantime though, here comes the boom: The Monterey Shale's liquid assets are already helping California's economy. Speculating oil companies are already moving in, bidding more than a thousand dollars an acre in some land auctions, according to the New York Times. Fracking advocates agree this is the very thing we need to bolster our red-ink economy.

Stephen T. Holzer is the Chair of our Environmental Practice Group. Direct your questions regarding environmental concerns and your property to Mr. Holzer via email.

 

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

Tuesday
Sep132011

Perchloroethylene Cleanup Hangs Drycleaners Out to Dry

Litigation Los AngelesEnvironmental Litigation  

Stephen T. Holzer
818.907.3299

Drycleaners have been using perchloroethylene, a colorless liquid chemical also known as “PERC” or “PCE,” for decades. The chemical is also used in solvents, inks, shoe polish and other products, but it’s the dry-cleaning industry that accounts for 85 percent of its use.

PERC is a hazardous waste made with chlorine and other chemicals, and until modern-era environmental legislation regulating the disposal of PCE, the liquid leaked or spilled into the ground and seeped into water tables without much notice.

But federal and state-mandated clean ups are now hanging drycleaners out to dry financially, and insurance companies are also paying the price. In an attempt to find someone to pay for cleanup, some drycleaners are suing their machine manufacturers citing faulty designs and distributing use instructions that failed to warn drycleaners of potential perchloroethylene leaks and how to prevent them.

The drycleaner plaintiffs allege the machine manufacturers violated the federal Resource Conservation and Recovery Act, or RCRA, which governs all handling of hazardous waste from generation to disposal. RCRA provides for liability on the part of:

“Any person . . . including any past or present generator, past or present transporter, or past or present owner or operator of a treatment, storage, or disposal facility, who has contributed or who is contributing to the past or present handling, storage, treatment, transportation, or disposal of any solid or hazardous waste which may present an imminent and substantial endangerment to health or the environment . . . .”

The Plaintiffs in Hinds Investments v. Patricia McLaughlin relied on this language in RCRA. But last August, the Ninth Circuit Court of Appeals rejected plaintiffs’ claims, stating:

“From the language Congress chose, it seems plain that Congress was concerned with those who handle, store, treat, transport, or dispose of the waste, not with manufacturers who design machinery that might generate a waste byproduct that could be disposed of improperly at hazard to the public.”

Despite the Appellate Court’s ruling, perchloroethylene cleanup remains controversial, because plaintiffs may still try to hold dry-cleaning machine manufactures liable under other, State-law theories.

But manufacturer defendants in the dry-cleaning industry can now argue that holding such defendants liable for what their customers is too far of a judicial reach even at the State level, when it comes to perchloroethylene leaks.

Stephen T. Holzer is the Chair of our Environmental Law Practice Group.  You can reach him via e-mail: sholzer@lewitthackman.com, or by calling 818.990.2120.

 

 
Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

 

 

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