Environmental Protection Agency

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By Michael J. Gergen, Jared W. Johnson, and David E. Pettit

On June 19, 2014, the Federal Energy Regulatory Commission (“FERC” or “Commission”) conditionally accepted revisions to the California Independent System Operator Corporation’s (“CAISO”) FERC Electric Tariff to implement the CAISO’s proposed Energy Imbalance Market (“EIM”) that will allow neighboring balancing area authorities (“BAAs”) in the western states to participate in the imbalance energy portion of the CAISO’s real-time market.  Energy imbalance services have long been required as an “ancillary service” under FERC’s open access regulations and pro forma open access transmission tariff (“OATT”).  In its proposal, the CAISO noted that the EIM was effectively an expansion of its existing real-time energy market allowing to take part in the EIM alongside entities already transacting within the CAISO.  PacifiCorp’s two BAAs will be the first to participate in the EIM, and in a concurrent order, FERC also conditionally accepted in large part corresponding revisions to PacifiCorp’s OATT.  NV Energy has also entered into an implementation agreement with the CAISO to join the EIM.  Although several market participants protested various aspects of the CAISO’s proposed design of the EIM, most of it was approved by FERC.  The CAISO plans to start the new EIM on October 1, 2014.    

By Michael G. Romey, Aron Potash and Gregory Fuoco (summer clerk)

On June 2, 2014, the U.S. Supreme Court announced it would not review a decision by the Court of Appeals for the Third Circuit allowing state common law tort claims against sources of air pollutants.  This spells uncertainty for emitters, who now must look beyond the requirements in their facility permits in contending with local tort law.  Even if they are in full compliance with the Clean Air Act (CAA), sources—including fossil fuel-fired power plants, petroleum refineries, and emitters of greenhouse gases (GHGs)—may be faced with claims that their emissions constitute a nuisance or trespass. 

By Paul Singarella, Claudia O’Brien and David Amerikaner

The proposed rule to revise the definition of “waters of the United States” under the federal Clean Water Act, which originally was announced on March 25, 2014 by the United States Environmental Protection Agency (EPA) and United States Army Corps of Engineers (Corps), formally was published in the Federal Register on Monday, April 21, 2014. (Federal Register Vol. 79, No. 76, Monday, April 21, 2014, at pages 22187-22274.) The text of the proposed rule is substantively identical to the March 25 pre-release version.

By Ann Claassen and Eli Hopson

Last week EPA finalized the Renewable Fuel Standard (“RFS”) levels for 2013.[1]  Although EPA missed the statutory deadline of November 30, 2012, for setting levels for the 2013 RFS, EPA notes that the statute does not provide any penalty for missing the deadline, nor does it remove the general requirements of the RFS if the deadline is missed.[2]  In light of the significant delay, EPA has extended the deadline for obtaining sufficient credits for gallons of ethanol equivalent fuels (known by the term Renewable Identification Number, or RIN) from February 28 to June 30, 2014.  EPA also intends to meet the statutory deadline of November 30, 2013 for the 2014 standards, and therefore will have released the 2014 standards well in advance of the 2013 compliance deadline.  This will allow obligated parties to make informed decisions about their 2013 compliance strategies, such as whether to use banked RINs, or save certain RIN categories for 2014 compliance.[3]

By Joshua T. Bledsoe and Aron Potash

California’s low carbon fuel standard (LCFS), a core component of the state’s greenhouse gas (GHG) emission reduction strategy, likely will survive a legal challenge and remain in effect despite an appellate court’s order indicating that the regulation was improperly adopted.

The California Court of Appeal for the Fifth Appellate District issued a tentative disposition on June 3, 2013, in POET, LLC et al. v. Goldstene, et al. finding that the California Air Resources…

By Mia Robertshaw

The U.S. District Court for the District of Columbia has removed a layer of uncertainty for Clean Water Act section 404 permits.  On March 23, 2012, the Court held that the U.S. Environmental Protection Agency (EPA) exceeded its authority by purporting to invalidate an existing section 404 dredge-and-fill permit.  Nearly three years after the permit was issued, in a move unprecedented in the history of the Clean Water Act, EPA purported to withdraw the specification of disposal…

By Michael Feeley and Aron Potash

A lawsuit which delayed and once threatened to dismantle California’s greenhouse gas (GHG) cap and trade scheme was largely resolved last week, removing one roadblock to California’s plan to be the first state to impose an economy-wide GHG trading program.  Under modified regulations adopted by the California Air Resources Board (CARB) on October 20, 2011, California will require certain emitters of GHGs to obtain allowances or offsets in amounts commensurate to their respective emissions…

In a March 15, 2011, decision, the Fifth Circuit Court of Appeals vacated in part the Environmental Proection Agency’s (“EPA”) Concentrated Animal Feeding Operations (“CAFO”) rules, which we analyzed in a previous blog entry.  The Fifth Circuit struck down the requirement that CAFOs which “propose to discharge”—that is, which are “designed, constructed, operated, or maintained such that a discharge would occur”—must obtain NPDES permits.  Under EPA’s “propose to discharge” standard, a CAFO could be required to obtain an…

The United States Environmental Protection Agency faces an obligation to propose, before June of this year, a rule under the Clean Water Act which will impose reporting requirements upon owners and operators of concentrated animal feeding operations (PDF), or CAFOs, which include certain dairy and poultry farms, horse racing tracks, rodeo facilities, and many other types of operations. 

As EPA estimates that there are thousands of CAFOs which should have applied for National Pollution Discharge Elimination System, or NPDES, permits but did not do so (PDF), EPA is likely to propose that every CAFO—regardless of whether is has a permit or even discharges—provide information which will enable EPA to determine if the facility must obtain a permit and if it is otherwise in compliance with CAFO regulations. 

The expected proposed rule’s reporting requirements will place noncompliant CAFOs at heightened risk of EPA enforcement action.  EPA is also obligated to release to the public the information it collects on CAFOs under the new rule, which could place CAFO owners and operators at risk of citizen suits. 

In light of this expected proposed rule, the window may quickly be closing for CAFOs to come into compliance with CWA requirements, including by contacting EPA to self-report noncompliance, before EPA undertakes what could be a significant enforcement initiative.  Waste-to-energy opportunities may arise as CAFOs evaluate their waste management practices and potentially modify their facilities in response to the CAFO compliance push.