Air Quality and Climate Change

Proposed regulations clarify FEOC restrictions and clean vehicle tax credit compliance for manufacturers aiming to produce eligible EVs.

By Jean-Philippe Brisson, Jim Cole, Eli M. Katz, Qingyi Pan, Rob Thompson, J. Dylan White, and Sam Wong

As countries around the world accelerate the transition to clean energy, the race to gain shares in the electric vehicle (EV) manufacturing market is intensifying, with global sales of EVs rising 31% in 2023.[1]

To facilitate increased

EPA’s transfer of primary enforcement authority to states for carbon capture and storage projects may decrease permitting delays but raise legal questions.

By Nikki Buffa, Joshua Bledsoe, Jennifer Roy, Michael Dreibelbis, Brian McCall, Austin Wruble, and Sam Wong

Louisiana has become the third state in the United States to receive primacy from the US Environmental Protection Agency (EPA), allowing it to assume permitting authority for carbon capture and storage (CCS) projects. EPA granted primacy

New report raises social cost of carbon estimates, surpassing previous estimates by more than 250%.

By Joshua Bledsoe, Kevin Homrighausen, and John Detrich

On December 2, 2023, the US Environmental Protection Agency (EPA) released a final report that substantially increases estimates of the social cost of greenhouse gases (GHG), including carbon dioxide, methane, and nitrous oxide (collectively, SC-GHG). The report describes SC-GHG as “the monetary value of the net harm to society from emitting one metric ton of that GHG into the atmosphere in a given year.”[1] The new estimates are intended to serve as a tool for decision-makers, aiding in the cost-benefit analysis of actions that would reduce or increase GHG emissions. Indeed, federal agencies are expected to use the estimates in future rule-makings and in the environmental review of forthcoming projects.

A district court has ruled that federal law does not preempt an indirect source rule that targets emissions associated with warehouses in Southern California.

By Joshua Bledsoe, Nick Cox, and Jennifer Garlock

On December 14, 2023, a US federal judge rejected claims that federal law preempts the South Coast Air Quality Management District’s (SCAQMD or the District) adoption of Rule 2305 (Rule), upholding the first-in-the-nation Rule[1] that regulates trucking emissions from warehouses.

Rule 2305 is the Warehouse Indirect Source Rule (ISR) — Warehouse Actions and Investments to Reduce Emissions (WAIRE) Program. As described in this Latham blog post, the WAIRE Program applies to certain warehouses in the South Coast Air Basin and imposes a compliance obligation based on the number of truck visits to that warehouse per year. Warehouse operators can meet that obligation by taking any number of emissions-reducing actions, either from the “WAIRE Menu” or through a custom plan approved by the District.

Regulators are pursuing steep fines in response to widespread alleged noncompliance with an emissions rule still subject to potential reversal by the courts.

By Joshua T. Bledsoe, James Friedland, and Jennifer Garlock

Key Points:

  • The enforcement action alleges 1,400 warehouses are noncompliant.
  • Noncompliance can result in fines of up to $11,710 per day.
  • Litigation challenging this program remains pending, with no quick end in sight.

On September 20, 2023, the South Coast Air Quality Management District (SCAQMD or the District) announced an enforcement initiative for Rule 2305, also known as the Warehouse Indirect Source Rule (ISR), which is part of the Warehouse Actions and Investments to Reduce Emissions (WAIRE) Program. As described in this June 2021 blog post, the WAIRE Program applies to warehouses in the South Coast Air Basin over 100,000 square feet, with a phased implementation based on warehouse size. The ISR imposes a compliance obligation based on the number of truck visits to that warehouse per year, which warehouse operators can meet through emissions-reducing actions, either from the “WAIRE Menu” or through a custom plan approved by the District.