We reported in January that three environmental groups had notified the Fish and Wildlife Service (FWS) of their intent to sue over the Service’s failure to act on a petition to list the polar bear as a threatened or endangered species. The original petition was filed in February 2005.

Under 16 U.S.C. § 1540(g)(2)(C), written notice must be given to the Secretary of the Interior at least 60 days before a citizen suit can be filed in federal district court. The 60 day period elapsed yesterday and the three groups — the Center for Biological Diversity, Greenpeace, and the Natural Resources Defense Council — filed suit to force FWS to act on the petition.

The Department of the Interior has indicated that it will respond to the suit “in a timely manner.”

The Center for Biological Diversity also recently sued the FWS to have ten species of penguins listed as a result of the effects of climate change. For many penguin species, including the emperor penguin, loss of habitat, caused by declines in Antarctic sea ice, poses a significant threat to survival.

For further information about this topic, please contact Akin Gump.

In our previous coverage of Center for Biological Diversity v. National Highway Traffic Safety Administration, Perry Rosen noted that one likely course of action was for NHTSA to petition for a rehearing en banc - before the full Ninth Circuit, rather than just the typical panel of three judges. NHTSA recently filed just such a petition before the Ninth Circuit.

In the original ruling, the judges found that the new CAFE (fuel economy) standards were arbitrary and capricious. In addition, the court held that the Environmental Assessment (EA) was inadequate, and ordered NHTSA to produce a full Environmental Impact Statement (EIS) that accounts for the effect of emissions on climate change. An EIS is required when an agency find that its proposed action will have a significant impact on the environment.

NHTSA’s petition focuses on the second aspect of the decision, and argues that the 9th Circuit does not have the authority to order a full EIS. Instead, NHTSA argues that it should be allowed, on remand, to address any deficiencies in the EA and potentially avoid the preparation of a full EIS.

NHTSA argues that administrative law “only allows a reviewing court to ‘hold unlawful and set aside’ agency action that if finds arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” Citing a long string of Supreme Court cases, the agency writes that “when a reviewing court finds that an administrative agency has erred, the appropriate remedy is to remand the matter back to the agency for ‘further consideration.’” The court does not substitute its own judgment for that of the agency, but merely reviews the agency’s determinations.

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A ruling this morning invalidating the U.S. mercury emissions cap and trade program should not impact the Environmental Protection Agency’s authority to establish trading programs for other emissions, including carbon dioxide.

The United States Court of Appeals for the District of Columbia Circuit today struck down two rules promulgated by the U.S. Environmental Protection Agency (EPA) addressing mercury emissions from coal-fired power plants. State of New Jersey v. EPA, No. 05-1097 (D.C. Cir. Feb. 8, 2008). The court ruled that EPA deleted power plants from the list of emission sources subject to hazardous air pollutants requirements of the Clean Air Act (CAA) without following the statutory requirements for delisting. This conclusion, the court reasoned, required it also to invalidate EPA’s Clean Air Mercury Rule (CAMR) that had established numerical limitations for the emission of mercury from power plants and a cap and trade system for compliance with those limits.

The Bush Administration developed and promulgated CAMR in an effort to back away from an 11^th hour finding issued by EPA Administrator Browner in December 2000 that regulation of mercury emissions from coal-fired power plants under the hazardous air pollutant program was “appropriate and necessary.” This finding by the Clinton Administration was not subject to judicial review, but served as the linchpin for the court’s invalidation of CAMR. Once EPA made that finding and included power lists on the “list” of emission sources subject to regulation, the court ruled EPA could change course only by following the procedures set forth in the CAA.

To promulgate the CAMR, and its cap and trade system, EPA tried to short-circuit the statutory procedures. The court ruled that EPA did not have the discretion to proceed in that manner. While this decision prevents EPA from proceeding with a cap and trade system for mercury emissions, it does not provide opponents of cap and trade systems comfort. The court expressly declined to consider arguments concerning EPA’s authority to establish a cap and trade system for pollutants and sources outside the hazardous air pollutant regime.

For further information about this topic, please contact Akin Gump.

This post is the second part of a two part series analyzing challenges to coal-fired power plant permits under federal statutes.

Challenges to coal-fired power plants under the National Environmental Policy Act (NEPA) may not be as standard as those under the Clean Air Act, but their impact will be no less substantial. Lawsuits challenging permitting of coal-fired power plants under NEPA will, by their very nature, be limited because NEPA challenges require a “major” federal action that significantly affects the quality of the human environment – for example, a funding decision or a permit approval. While the cases may impact a small number of coal-fired power plants, the outcomes will have far-reaching consequences on any private project with greenhouse gas (GHG) emissions that requires federal approvals.

To date, there have been only two lawsuits filed challenging coal-fired power plant approvals under NEPA. Both cases involve loans and other approvals provided by the Rural Utilities Service (RUS), a Depression-era agency created to bring electricity to farming communities. The Sierra Club and local environmental groups argue that RUS’ Environmental Impact Statement (EIS) for the Highwood generating plant near Great Falls, Montana, failed to disclose the project’s carbon emissions and discuss the impacts of those emissions on climate change.

The second case, which involves the Sunflower Electric Corporation’s proposed expansion of its facility in Holcomb, Kansas, alleges failure to undertake an EIS to analyze global warming impacts (among other things), prior to approving alleged construction loans and other financing at the site. The Sunflower case – which also is in litigation over the Kansas Department of Health and Environment’s rejection of its permit on global warming grounds – involves a limited federal handle and defendants certainly will raise objections to Sierra Club’s characterization of RUS’ approvals as a “major” federal action.

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For further information about this topic, please contact Akin Gump.

The Environmental Protection Agency’s Environmental Appeals Board (EAB) declined to hear a Clean Air Act (CAA) challenge to a permit issued for construction of a coal-fired electric generating plant near Springfield, Illinois, on grounds the petitioners failed to properly raise their climate change arguments during public comment on the draft permit. Although the EAB did not reach the merits of the petitioners’ argument that the failure to include Best Available Control Technology (BACT) for CO2 violates the CAA, the Board did note that the issue “remains a matter of considerable dispute.”

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For further information about this topic, please contact Akin Gump.

This post is the first part of a two part series analyzing challenges to coal-fired power plant permits under federal statutes.

Lawsuits challenging coal-fired power plant permits from Oregon to Georgia have the potential to shape the regulatory future of industries that emit large quantities of greenhouse gases. These lawsuits are taking aim at power plants under two statutes: the Clean Air Act (CAA) and the National Environmental Policy Act (NEPA). Although these cases are in the early stages, the issues raised offer insight into what regulatory requirements will look like in a carbon-constrained world.

This post reviews the two CAA petitions filed before the Environmental Protection Agency’s appeals board challenging permitting of coal-fired power plants in Utah and Illinois, with plaintiffs’ groups vowing to challenge on CAA grounds permitting decisions by state boards in Georgia, Arkansas, Montana, and Oregon.

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For further information about this topic, please contact Akin Gump.

Today, three environmental groups informed the Fish and Wildlife Service (FWS) of their intent to sue the agency regarding the listing of the polar bear as an endangered or threatened species.

The Center for Biological Diversity, Greenpeace and the Natural Resources Defense Council had petitioned the government in February 2005 to give polar bears protection under the Endangered Species Act (ESA). After not receiving a response, the petitioners sued in federal court in December 2005. Center for Biological Diversity v. Norton (N.D. Cal).

On July 5, 2006, the parties agreed to a negotiated settlement under which FWS would publish a finding by December 27, 2006. On January 9, 2007, after missing the initial deadline, FWS issued a proposed rule to extend “threatened” status to polar bears, which would mark the first time a mammal was found to be at risk because of global warming. FWS had one year from that date to make a final determination. Read the rest of this entry »

For further information about this topic, please contact Akin Gump.

As companies prepare their 2007 10K filings to the U.S. Securities and Exchange Commission (SEC), issues surrounding disclosure of the risks and opportunities presented by climate change loom like an iceberg awaiting the passing of the Titanic. Despite numerous appeals from a variety of sources, the SEC has yet to issue interpretive guidance describing how companies should disclose climate change impacts.

Institutional investors, groups such as Ceres, and traditional environmental groups are demanding that public companies identify and quantify the impacts of climate change on their business. As recently as two years ago, shareholder resolutions relating to climate change were rare and generally considered “nuisance” resolutions. No more. Such resolutions abound and must be treated seriously.

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For further information about this topic, please contact Akin Gump.

Leveraging the decision in Massachusetts v. EPA, public interest groups are using the National Environmental Policy Act (NEPA) to challenge approvals of coal-fired power plants on global warming grounds. Montana Environmental Information Center v. USDA, No. 07-1311 (D. D.C. July 23, 2007).

The groups sued to enjoin Rural Utilities Service (RUS), an agency of the U.S. Department of Agriculture, from providing federal loans for construction of a coal-fired power plant. The plaintiffs asserted that the agency failed to assess adequately the proposed plant’s environmental impacts, including the impact of CO₂ emissions on global warming. The plaintiffs claimed further that the proposed plant, along with other coal-fired power plants seeking funding from RUS, “could account for a significant share of U.S. greenhouse gas emissions.” RUS’s failure to consider these cumulative impacts on global warming in its Environmental Impact Statement, according to plaintiffs, violates its obligations under NEPA to take a “hard look” at actions that could impact the environment.

The Supreme Court’s decision in Massachusetts v. EPA did not involve NEPA and did not address whether federal agencies must consider global warming potential when undertaking such actions as permit approvals or funding decisions. The Ninth Circuit’s recent decision in Center for Biological Diversity v. NHTSA, however, concluded that regardless of whether climate change is outside the control of the agency whose action is at issue, NEPA obligates the agency to assess the effects of its own actions on greenhouse gas emissions. Courts’ willingness to require agencies to consider global warming in regulatory decisionmaking will complicate previously routine actions such as funding coal-fired power plants.

Briefing in the case is slated to begin March 7, 2008 and conclude May 30, 2008.

For further information about this topic, please contact Akin Gump.

A federal court in California today issued a major ruling in the battle between states and the auto industry over who has the authority to regulate emissions from motor vehicles.

In Central Valley Chrysler-Jeep v. Goldstone, Judge Ishii of the Federal District Court for the Central District of California ordered that California may properly enact emissions regulations that are more strict than the federal fuel economy standards. The Plaintiffs, led by the Association of International Automobile Manufacturers, had argued that such regulations were pre-empted by federal law, specifically the Energy Policy and Conservation Act (EPCA). Read the rest of this entry »

For further information about this topic, please contact Akin Gump.