Environment, Land & Resources

Carbon Capture Updates From the COP 25

Posted in Air Quality and Climate Change, Energy Regulatory

Non-governmental organizations release new studies and reports on new developments in carbon capture, usage, and storage technology.

By Jean-Philippe Brisson, Christopher G. Cross, Paul J. Hunt, Eli M. Katz, Joshua T. Bledsoe, Benjamin W. Einhouse, and Taylor R. West

At the 25th annual Conference of Parties (COP 25) United Nations Climate Summit, held in December 2019 in Madrid, non-governmental organizations (NGOs) and other groups submitted reports and studies on the latest developments in environmental technology. Several organizations, including the Innovation for Cool Earth Forum, the Global CCS Institute, and the National Petroleum Council of the United States, submitted reports on the use and future development of carbon capture, use, and storage (CCUS) technologies.

Innovation for Cool Earth Forum

The Innovation for Cool Earth Forum (ICEF), an organization that organizes an annual conference hosted by Japan’s Prime Minister that brings international leaders together to tackle climate change, published a roadmap for Industrial Heat Decarbonization in December 2019 (the Roadmap).[i] The Roadmap outlines how the use of industrial heat must be changed to reduce global greenhouse gas (GHG) emissions, specifically discussing the issue of carbon dioxide (CO2) emissions. The Roadmap further notes that industrial heat is particularly important due to the fact that roughly 10% of all GHG emissions come from industrial heat production. The Roadmap discusses the use of heat in a variety of industries, including cement, iron, and steel, as well as chemical production. Generally, the Roadmap discusses solutions that include the use of low-carbon energy sources such as hydrogen combustion and biomass burning, and electrical sources such as resistance heating, microwaves, induction, and electric arc furnaces. Moreover, the Roadmap discusses the role of CCUS in reducing the carbon produced in the creation of industrial heat. Continue Reading

EU Commission Formally Announces European Green Deal

Posted in Air Quality and Climate Change, Environmental Regulation, European Environmental and Public Law

Analysing whether the new Green Deal policies will help the EU achieve climate neutrality. 

By Paul A. Davies and Michael D. Green

On 11 December 2019, the European Commission adopted the European Green Deal (Green Deal), initially proposed earlier in the year by the Commission’s President Ursula von der Leyen. The Commission also presented a communication (the Communication) on the Green Deal to the European Parliament. The Green Deal is intended to map out Europe’s strategy to becoming the first climate-neutral continent, by proposing a number of measures to reduce the continent’s greenhouse gas emissions and increasing biodiversity. This blog post will consider some of the Green Deal’s new proposals, and how those proposals aim to achieve the Commission’s “ambitious” targets.

4 Key Green Deal Policies

The Green Deal introduces a number of new policies that form the framework of what the EU terms, “the sustainable future”. These policies vary, both in terms of the areas they target and the level of detail the Green Deal currently provides on them. However, the Commission hopes that these measures will improve the EU’s green credentials and ensure the benefits of the transition to a zero carbon economy are felt by the whole population. Key policies include: Continue Reading

TCI Releases Framework for Draft Policy to Reduce GHG Emissions From Transportation

Posted in Air Quality and Climate Change, Environmental Regulation

Under the TCI program, fuel suppliers would be required to hold allowances to cover their reported emissions.

By Jean-Philippe Brisson, Joshua T. Bledsoe, and Benjamin W. Einhouse

The Transportation & Climate Initiative (TCI), a regional collaboration of Northeast and Mid-Atlantic states and the District of Columbia, has advanced its program to reduce greenhouse gas (GHG) emissions from the combustion of transportation fuels. On October 1, 2019, TCI published a Framework for a Draft Regional Policy Proposal (the Policy Proposal).

This blog post reviews the presentation of the TCI program’s key design elements and summarizes key stakeholder comments on the Policy Proposal. Continue Reading

Air District Targets Southern California Logistics Industry

Posted in Air Quality and Climate Change, California, CEQA, Environmental Regulation, Project Siting and Approval

A local air district is developing a rule that would require both existing and proposed warehouses to reduce trucking emissions or pay a mitigation fee.

By Joshua T. Bledsoe

The South Coast Air Quality Management District (SCAQMD or District) is developing a so-called Indirect Source Rule (ISR) that would require Southern California warehouses to reduce emissions associated with trucking activity and on-site equipment. Proposed Rule 2305, recently released by the District in discussion draft form, would establish the Warehouse Actions and Investments to Reduce Emissions (WAIRE) Program — which would apply to owners and operators of warehouses located in the South Coast Air Basin (Basin) with greater than 100,000 square feet of indoor space in a single building. If the SCAQMD’s development timeline holds, Proposed Rule 2305 will phase in on July 1, 2020. Continue Reading

Satisfying ‘Daubert’ in Environmental Toxic Tort Litigation

Posted in Environmental Litigation

Recent decisions have excluded plaintiffs’ expert opinions that fail to estimate actual exposure and prove it was sufficient to cause injury.

By Christine G. Rolph and Laura J. Glickman

Recent federal court rulings in toxic tort litigations have stressed the importance of the dose-response relationship and the need to carefully evaluate the level of exposure to pass the Daubert standard for expert witness admissibility under the Federal Rules of Evidence 702. Under the Daubert standard, courts must assess whether the reasoning or methodology underlying the expert testimony is scientifically valid and whether those reasons or methodologies can be properly applied to the facts at issue. Dose-response methodology studies the relationship between the quantity of a substance (dose) and its overall effect (response) on a person, and is “the hallmark of basic toxicology.”[1] The courts continue to scrutinize experts’ dose-response analysis to determine the reliability of that testimony on specific causation. The following three cases highlight the importance of a thorough dose-response analysis in any expert opinion that evaluates a plaintiff’s exposure and harm. Continue Reading

New Multi-Target French Climate Energy Package Boosts Objectives

Posted in Air Quality and Climate Change, Environmental Regulation, European Environmental and Public Law

The legislation includes six key measures to cut greenhouse gas emissions and to reach carbon neutrality by 2050.

By Paul A. Davies and Michael D. Green

The French Parliament has adopted a new climate energy package to tackle the effects of climate change and boost France’s energy transition endeavors to reach carbon neutrality by 2050. As per Article 4.1 of the 2015 Paris Agreement, carbon neutrality is defined in the package as the balance, across the national territory, between anthropic emissions by sources and removal of greenhouse gases by sinks. Six key goals comprise this latest legislation. Continue Reading

Council of EU Adopts ESG Disclosure and Benchmarks Legislation

Posted in Green Finance

The formal adoption reflects the EU’s acknowledgement that a robust system of sustainable finance will be essential to the proposed capital markets union.

By Paul A. Davies and Michael D. Green

On 8 November 2019, the Council of the EU published a press release announcing the adoption of legislative reforms that aim to enhance the proposed capital markets union. Notably, two of the reforms are related to sustainable finance: the Low Carbon Benchmark Regulation (LCBR), and the Disclosure Regulation, the full texts of which were published on 24 October 2019.

LCBR

The LCBR amends the previous Benchmarks Regulation, and was introduced in response to the perceived lack of uniformity among existing low-carbon indices. This inconsistency was considered to be unsatisfactory, as investors were unable to use benchmarks as reliable and easy tools to compare the low-carbon attributes of investments and portfolios.

To combat these issues, the LCBR introduces the following:

  • A new category of benchmarks, comprising two types of financial benchmark: an EU climate transition benchmark, and a “Paris-aligned” benchmark that brings investment portfolios in line with the Paris Agreement. Administrators for these benchmarks will have to publish detailed information on whether or not, and to what extent, the benchmarks ensure a degree of overall alignment with the target of reducing carbon emissions or the attainment of the objectives of the Paris Agreement is ensured.
  • An obligation for all benchmarks (with the exception of those related to interest rates and foreign exchange) to disclose in their benchmark statement whether or not their benchmarks pursue environmental, social, and corporate governance (ESG) objectives, and whether or not the benchmark administrator offers such ESG-focused benchmarks.
  • An extension of the transition regime under the Benchmarks Regulation to 2021, for critical and third-country benchmarks.

Moving forward, the LCBR empowers the European Commission to lay down the specific minimum standards for the two new benchmarks. These standards will specify the criteria for the choice of underlying assets, the weighting of those underlying assets, and the trajectory for the decarbonisation of the climate transition benchmark, as well as determining the method for the calculation of the carbon emissions associated with the underlying assets. In completing this task, the Commission will take into account the work of the Technical Expert Group on Sustainable Finance, which published a final report on the climate-related benchmarks introduced by the LCBR on 30 September 2019. (See EU Issues Final Report on Climate Benchmarks and ESG Disclosures).

Administrators who seek to provide either of the two new benchmarks will need to comply with the LCBR by 30 April 2020.

Disclosure Regulation

The Disclosure Regulation governs ESG disclosure requirements for financial market participants and financial advisers, and how those firms integrate ESG factors into their investment decisions. (See EU Issues New Sustainable Investment Disclosure Rules). The next step is for European supervisory authorities to come up with specific and detailed rules for the implementation of the Disclosure Regulation, for which they are expected to begin the consultation process in early 2020.

Conclusion

The adoption of the LCBR and the Disclosure Regulation demonstrates the EU’s continuing interest in sustainable finance and its acknowledgement that a robust system of sustainable finance will be an essential part of the capital markets union. The effectiveness of the new regulations remains to be seen, and may be dependent on the technical input to be provided by the Commission in the near future.

Latham & Watkins will continue to follow and report on developments in this area.

This post was prepared with the assistance of James Bee in the London office of Latham & Watkins.

German Court Dismisses Farmers’ Climate Protection Claim

Posted in Environmental Litigation

The court argued that the German government’s 2014 decision on climate protection goals for 2020 was not legally binding.

By Jörn Kassow

On 31 October 2019, the Administrative Court of Berlin dismissed a climate lawsuit brought by German citizens against the government. The plaintiffs had alleged that the government was violating their rights by missing certain climate protection targets.

In 2014, the German government adopted its climate protection goals for 2020, which aimed at a reduction of greenhouse gas (GHG) emissions by 40% (compared to 1990). However, the government now estimates that Germany will only be able to reduce emissions by 32%. Furthermore, Germany will probably not achieve the 14% reduction of GHGs which are not covered by the European Union Emissions Trading System (EU ETS), as required under the so-called Effort Sharing Decision, without credits from emission-reduction projects in third countries. Continue Reading

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