EPA Updates Standards and Practices for All Appropriate Inquiries (AAI)

By Latham & Watkins LLP on December 28, 2022 Posted in Contaminated Properties & Waste, Environmental Regulation

EPA adopts final rule, effective February 13, 2023, establishing ASTM E1527-21 as the standard for satisfying AAI requirements and phasing out ASTM E1527-13.

By Aron Potash, Josh Marnitz, Phil Sandick, and Bruce Johnson

On December 15, 2022, the US Environmental Protection Agency (EPA) amended its rule for conducting “All Appropriate Inquiries” (AAI) under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) to incorporate a new standard for conducting Phase I Environmental Site Assessments (Phase I). Satisfying AAI is a critical step when acquiring or leasing real property. AAI is a prerequisite to certain safe harbors under CERCLA (and state analogues), which otherwise subjects property owners and operators to liability for investigating and remediating contamination regardless of fault.

When EPA’s final rule for conducting AAI (AAI rule) takes effect on February 13, 2023, it will allow for the use of the updated standard for conducting Phase Is recently published by ASTM International (ASTM) (i.e., ASTM E1527-21) when conducting AAI. One year after the final rule goes into effect, the previous Phase I standard, ASTM E1527-13, will no longer be sufficient to satisfy AAI. ASTM E1527-21 incorporates several changes that distinguish it from E1527-13, including expanding requirements for using historical sources, updating guidance on emerging contaminants, and expanding reporting requirements.

FTC Seeks Public Comments on Green Guides as Part of 10-Year Review Cycle

By Latham & Watkins on December 20, 2022 Posted in Environmental Regulation, Environmental, Social and Governance

The updated Green Guides will likely impact legal liability for environmental marketing claims in the years to come.

By Jean-Philippe Brisson, Paul A. Davies, Sarah E. Fortt, Julia A. Hatcher, Betty M. Huber, Robin M. Hulshizer, Michael Dreibelbis, Michael D. Green, Danny Dvorak, Brett Frazer, Austin J. Pierce, Angela Walker, and Jacqueline Y. Zhang

Latham & Watkins presents a blog series on the Federal Trade Commission’s Guides for the Use of Environmental Marketing Claims (Green Guides). This first post discusses the evolving focus areas as well as the enforcement and litigation risks of the Green Guides.

On December 20, 2022, the Federal Trade Commission (FTC) published a notice (hereinafter, the 2022 Notice) requesting public comments on its Guides for the Use of Environmental Marketing Claims (commonly known as the Green Guides or the Guides). The FTC reviews its rules and guides on a 10-year schedule, and its publication of the 2022 Notice is in accordance with the agency’s regulatory review cycle. The Guides were first issued in 1992 and most recently revised in 2012.

The public can submit comments by using the Federal Register online submission form or by mailing comments to the FTC. The public comment period will close on February 21, 2023.

The FTC publishes the Green Guides in part to support marketers and companies in their environmental advertising decisions. Adherence to the Guides can also help companies avoid litigation involving deceptive environmental claims. Further, the Guides can inform companies in their supply chain decision-making. Per the FTC, the Guides are designed to provide guidance on (1) general principles that apply to all environmental marketing claims; (2) how consumers are likely to interpret particular claims and how marketers can substantiate these claims; and (3) how marketers can qualify their claims to avoid deceiving consumers.[1]

CARB Adopts Final 2022 Scoping Plan

By Latham & Watkins on December 16, 2022 Posted in Air Quality and Climate Change, California

The plan accelerates already ambitious climate goals for California and charts a course to carbon neutrality by 2045.

By Joshua Bledsoe, Jen Garlock, and Brian McCall

On December 15, 2022, the California Air Resources Board (CARB) adopted its Final 2022 Scoping Plan for Achieving Carbon Neutrality (Final Scoping Plan). Assembly Bill (AB) 32 requires CARB to develop and update every five years a scoping plan that describes the approach California will take to reduce greenhouse gas emissions (GHGs) to combat climate change. AB 32 originally set a target of reducing emissions to 1990 levels by 2020. After California met this goal, Senate Bill (SB) 32 strengthened the state’s GHG reduction target to at least 40% below 1990 levels by 2030. California committed to even greater targets this year with adoption of AB 1279, which directs the state to become carbon neutral no later than 2045.

European Parliament and European Council Reach Provisional Agreement on Carbon Border Adjustment Mechanism

By Latham & Watkins LLP on December 16, 2022 Posted in Carbon Offsets, European Environmental and Public Law

By Paul A. Davies, Michael D. Green, and James Bee

The CBAM would seek to mitigate carbon leakage through the imposition of a levy on carbon-intensive imports into the EU, while free allowances under EU ETS would be phased out.

On 13 December 2022, negotiators from the European Parliament and European Council reached a provisional and conditional agreement on the terms of the EU’s carbon border adjustment mechanism (CBAM).

The CBAM was initially proposed by the European Commission in July 2021 as part of its “Fit for 55” package of policies. The measure seeks to address and mitigate the risk of “carbon leakage” from the EU, which refers to the risk that the EU’s greenhouse gas reduction efforts will be offset by increasing emissions outside of its border through the relocation of production to non-EU countries with less ambitious emissions reduction policies.

The CBAM would impose a levy on in-scope goods that are imported into the EU. Importers of such goods would be required to pay an amount equal to the cost of the emissions allowances under the EU Emissions Trading System (ETS) that would have been necessary to pay to produce that good in the EU.

Momentum Builds Toward California Offshore Wind Reality

By Latham & Watkins LLP on December 2, 2022 Posted in California

California’s first upcoming offshore wind lease sale, scheduled for December 6, 2022, is the next major step forward for clean energy in the Golden State.

By Nikki Buffa, Jennifer K. Roy, Janice M. Schneider, Daniel P. Brunton, Nathaniel Glynn, and Brian McCall

The Bureau of Ocean Energy Management (BOEM) and the State of California have taken significant steps to advance offshore wind development in the lead-up to BOEM’s upcoming auction for the first renewable energy lease sale in federal waters offshore California. The BOEM lease sale will involve a number of new facets not seen in other recent lease sales in New York and North Carolina, including revised bidding credits and lease stipulations. In anticipation of the lease sale, California is developing a permitting roadmap to streamline the state approvals process for any resulting offshore wind projects.

On the federal side, the Biden Administration is deploying significant resources and funding to boost development of floating offshore wind technologies that will be essential off the Pacific Coast. While BOEM’s upcoming lease sale and California’s actions to support offshore wind development represent an important moment for the offshore wind industry, many challenges remain to capture the full resource potential off California’s coast.

Study: Growing Wildfire Risks Threatening California’s Climate Policies

By Latham & Watkins on December 2, 2022 Posted in Air Quality and Climate Change, California

The 2020 wildfire season alone released more carbon dioxide than what California reduced through years of emission cuts.

By Marc Campopiano and Joshua Bledsoe

California is a recognized leader in climate policy, but a wildfire crisis is threatening to unwind progress towards the state’s ambitious climate goals. In 2006, with the passage of AB 32, California set a then-unprecedented target of reducing the state’s greenhouse gas emissions (GHGs) to 1990 levels by the year 2020. Having achieved this goal, California dramatically upped the ante with the passage of SB 32, requiring a 40% reduction of GHGs, and again earlier this year with AB 1279, which requires the state to become carbon neutral by 2045 or earlier. Despite notable progress to date, a recent university study found that GHGs emitted from California’s 2020 wildfire season alone equated to more than double of all the GHG reductions the state achieved since 2003.[1]