Chernobyl & Gulf Spill Anniversaries, BP Advances $1 Billion for Natural Resource Damages, Xayaburi Dam (by Bob Percival)

As Japan continues to struggle with the aftermath of an earthquake and tsunami that has crippled four nuclear reactors, today is the 25th anniversary of the world's worst nuclear accident at the Chernobyl nuclear power station #4 in north central Ukraine. In the 25 years since the Chernobyl accident the damaged reactor has been at the center of a large human exclusion zone because of radiation released in the accident. It is estimated that the inside of the damaged reactor, which is surrounded by a crumbling cement sarcophagus, will be dangerously radioactive for the next 300 years. Funds are being raised to encase the facility in a new steel containment structure. Radiation in the exclusion zone has declined to the point where small groups of tourists may make brief tours to a monument outside of the damaged reactor to the nearby ghost town of Pripyat, whose 55,000 inhabitants had to be evacuated due to the accident. I visited Chernobyl on one of these tours in March 2009 (see blog post of March 22, 2009. A gallery of photos from this visit is available online at: http://gallery.me.com/rperci#100427.

The effect of the Japanese accident in dampening a revival of the nuclear power industry was apparent last week when NRG Energy Inc. announced that it was withdrawing from a project to build new new nuclear power reactors in Texas. The reactors were to be furnished by Toshiba and financed in large part by Tokyo Electric Power Co., the financially crippled owner of the Fukushima Daichi nuclear power complex where accident response is still ongoing.Rebecca SMith, NRG Drops Plan for Texas Reactors, Wall St. J., April 20, 2011, at B1. Meanwhile Exxon CEO Rex Tillerson predicted that nuclear power's share of global energy production would be unchanged thirty years from now despite the Japanese disaster. David Blair & Sylvia Pfeifer, Exxon Sees Nuclear Holding Its Own, Financial Times, April 21, 2011, at 18.

Wednesday April 20 was the first anniversary of the Deepwater Horizon blowout and oil spill in the Gulf of Mexico. In an op-ed in the Wall Street Journal, BP CEO Bob Dudley expressed regret for the accident and reiterated that BP would pay all legitimate claims. Bob Dudley, The Lessons of Deepwater Horizon, Wall St. J., April 20, 2011, at A15. BP reached a settlement with the Justice Department last week in which BP agreed to provide $1 billion as a down payment on what it will owe for damages to natural resources. The money will be used for coastal restoration projects. In addition BP and other responsible parties are likely to owe the Oil Spill Liability Trust Fund large penalties under the Clean Water Act that could range from $5 to $21 billion on top of the compensation it is paying through its $20 billion compensation fund. Consideration is being given to legislation that would allocate 80% of these penalties to Gulf Coast restoration, as recommended by the President's Commission on the spill, rather than using it to replenish the Trust Fund to a level of $2.7 billion with the rest going to the U.S. Treasury as current law provides. Campbell Robertson, Beyond the Oil SPill, the Tragedy of an Ailing Gulf, N.Y. Times, April 21, 2011, at A16.

Last week BP filed lawsuits in federal district court in New Orleans against Transocean, the owner of the Deepwater Horizon oil rig, and Cameron International, the manufacturer of the blowout preventer that failed in the accident. BP alleges in the lawsuits that negligence by Transocean and Cameron caused the blowout. Transocean and Cameron filed cross claims against each other and BP. BP's case against Transocean may be bolstered by a Coast Guard report released on Friday April 22, which faulty the company for improper maintenance and poorly designed safety systems, though the report focused largely on the fire and sinking of the Deepwater Horizon platform, and not the initial cause of the blowout, because of the Coast Guard's jurisdiction over the rig, which is treated like a ship subject to Coast Guard regulation. Russell Gold & Angel Gonzalez, Spill Report Faults Transocean Rig, Wall St. J., April 23-24, 2011, at A3.

Plans to build a $3.5 billion dam on the Mekong River temporarily were placed on hold last week when Vietnam, Cambodia and Thailand objected to Laos's plan to proceed with the 1,20 megawatt Xayaburi dam. At a meeting sponsored by the Mekong River Commission, the three objecting countries argued that insufficient consideration had been given to the environmental impact of the project. The Commission itself had released a study late last year that found that the dam would "fundamentally undermine the abundance, productivity, and diversity of Mekong fish resources." The project is one of ten or more dam projects being considered in the region. Pursuant to a 1995 regional agreement, the countries are committed to consult with one another before proceeding with such dam projects, but no country has veto power. Thus, Laos ultimately may decide to go ahead with the project despite the objections of the other countries. Patrick Batra, Asian Nations Defer Decision on Dam, Wall st. J., April 20, 2011, at A9.

A week after the oral argument in the Supreme Court in the climate change case (American Electric Power v. Connecticut), a consensus seems to be emerging in the blogosphere that the plaintiff states suing electric utilities with large, coal-fired powerplants are likely to lose, though the grounds for such a decision are uncertain. Most believe the Court will hold that EPA's efforts to regulate greenhouse gas emissions under the Clean Air Act will be held to displace the federal common law of nuisance.

Yesterday it was announced that the University of Maryland School of Law has received a $30 million donation from the W.P. Carey Foundation. Tamar Lewin, Maryland Renames Law School After Gift, N.Y. Times, April 25, 2011, at A14.The law school will now be named the University of Maryland Francis King Carey School of Law, in honor of Francis Carey who graduated from the law school in 1880. The funds are unrestricted and will be a great boost to all of our school's programs, including our environmental law program. The gift, which is one of the ten largest gifts in the history of legal education, is a tribute to the generosity of the Careys and the great work of Phoebe Haddon, our dean. A celebration involving Maryland Governor Martin O'Malley and Baltimore Mayor Stephanie Rawlings, both alums of our law school, as well as other leading figures in Maryland's bench and bar was held at the law school yesterday.

TVA Settlement, BP Annual Meeting, Chevron CEO Interview & AEP Argument (by Bob Percival)

On Thursday April 14 the U.S. Justice Department announced that the Tennessee Valley Authority (TVA) will close 18 old coal-fired electrical generating units at three power plants in settlement of litigation by states and environmental groups charging the TVA with violations of the Clean Air Act's new source review (NSR) provisions. The plants, which are more than 50 years old, have operated for decades without modern pollution control equipment because they were grandfathered-in when the 1970 Clean Air Act (CAA) was adopted. The idea was that they eventually would be replaced by generating units that would have new pollution controls required by the Act, but the TVA continued to renovate the old plants to take advantage of the CAA's failure to control existing sources. The settlement covers all of the power plants targeted by a state common law nuisance suit brought by North Carolina. Eight of the generating units that will be shut down at two power plants initially had been ordered in January 2009 to install new pollution control equipment due to North Carolina' lawsuit. North Carolina ex rel. Cooper v. Tennessee Valley Authority, 593 F. Supp. 2d 812 (W.D.N.C. 2009). However, in July 2010 the U.S. Court of Appeals overturned this decision, erroneously ruling that as long as the power plants were in compliance with the CAA they could not be nuisances at common law. North Carolina ex rel. Cooper v. Tennessee Valley Authority, 615 F.3d 291 (4th Cir. 2010) (see August 1, 2010 blog post).

What may have spurred the settlement was the filing of a petition for Supreme Court review of the Fourth Circuit's decision. While the TVA generally has independent litigating authority, when a case goes to the Supreme Court the Solicitor General (SG) must weigh in and the SG's office repeatedly had sought extensions of the deadline for its reply to the state's cert petition. Presumably the SG's office consulted EPA which may have insisted that TVA settle the NSR litigation. The settlement will reduce TVA's emissions of sulfur dioxide by 97% below 1977 levels and nitrogen oxides by 95%. TVA also will spend between $3 and 5 billion to upgrade pollution controls at plants that it will continue to operate.

On April 14 BP held its annual meeting of shareholders in London. Protesters covered in what looked like oil greeted the shareholders as they filed into the meeting. The father of Gordon Jones, a worker who had been killed when the Deepwater Horizon oil platform exploded and caught fire, took the microphone and argued that the company could have prevented his son's death. This prompted BP CEO Robert Dudley to read out the names of the 11 workers who were killed by the blowout. Other protesters sought to disrupt the meeting to draw attention to BP's development of Canada's tar sands. Kiran Stacey & Sylvia Pfeifer, BP Shareholders Shaken by Invasion of Motley Protesters, Financial Times, April 15, 2011. Twenty-five percent of BP shareholders voted against the re-election to BP's board of Sir Bill Castell, chair of the board's safety committee.

Last week Chevron's CEO John Watson gave an interview to Kimberley Strassel of the Wall Street Journal where he argued that renewable energy is too expensive to be a significant supply source and that because America has taken "affordable energy for granted" it will need a lot more oil, coal and natural gas. He also strongly attacked EPA's effort to regulate emissions of greenhouse gases. Apparently the interview did not touch on whether Watson believes in Chevron's massive "We Agree" advertising campaign or how he feels about the $8.6 billion judgment against the company for pollution in Ecuador. Kimberley Strassel, Oil WIthout Apologies, Wall St. J., April 16-17, 2011, at A11.

Today the U.S. Supreme Court heard oral argument in American Electric Power v. Connecticut, a case involving whether a federal common law nuisance lawsuit by several states can be brought against utilities operating large coal-fired powerplants. The case initially was brought by the states in 2004, dismissed as a political question by a federal district judge in 2005, and then reinstated by the U.S, Court of Appeals for the Second Circuit in 2009 (see Sept. 27, 2009 blog post). I attended the oral argument and will provide more details in my next blog post. A transcript of the argument is available online at: http://www.supremecourt.gov/oral_arguments/argument_transcripts/10-174.pdf

Last Wednesday Alan Miller from the International Finance Corporation, who is one of the co-authors of my environmental law casebook, attended the Nats/Phillies game with me. On the second to the last pitch of the game I caught a foul ball hit by Pudge Rodriguez (unfortunately he struck out on the next pitch with the tying and winning runs on base and the Phillies won 3-2). On Thursday evening I attended a Fulbright Association reception at the Colombian embassador's residence.

I am currently experiencing technical difficulties posting to my parallel blog at: www.globalenvironmentallaw.com, which contains more photos. I started doing parallel postings because the Chinese government's firewall sometimes would block one of the two websites. Now I have another reason to be glad that I have been doing cross postings.

EPA GHG Riders Deleted in Budget Compromise, ABA Int'l Section: India & China, Texas Senate Seeks to Bar Climate Change Suits (by Bob Percival)

Faced with the specter of a shutdown of the U.S. government at midnight last Friday, a last-minute compromise was reached that continued funding for a week in return for a promise of $38 billion in overall budget cuts. Fortunately the Obama administration insisted on the deletion of “policy riders” adopted by the House that would have barred EPA from regulating emissions of greenhouse gases (GHGs). Although EPA still faces the prospect of significant budget cuts, President Obama has made it clear that he will veto legislation that includes similar policy riders. Separate legislation to amend the Clean Air Act to bar EPA from regulating GHGs (deceptively titled the “Energy Tax Prevention Act”) passed the House last week by a vote of 255 to 172 with the support of 19 Democrats. An effort to get the Senate to approve similar legislation on Friday fell ten votes short of the 60 votes needed to avert a filibuster. President Obama has promised to veto such legislation.

This week the section on International Law of the American Bar Association (ABA) held its annual Spring Meeting in Washington. On Thursday April 7 I was on a panel on “Evolution of the Environmental Rule of Law in China and India.” The panel was moderated by former EPA General Counsel Roger Martella. Jay Pendergrass from the Environmental Law Institute (ELI) and Stanford professor Armin Rosencranz discussed the state of environmental law in India. They noted that despite a burst of judicial activism on behalf of the environment by the Supreme Court of India during the 1990s, development interests now are prevailing in most environmental conflicts in the country. The legal system works notoriously slowly in India and enforcement of environmental law has not been a high priority as the country pursues rapid development. India’s Minister of Environment and Forests Jairam Ramesh has made a splash by temporarily halting certain projects for failure to comply with India’s environmental laws. These include the Lavasa project, India’s first planned hill city. However, most of these projects ultimately will be completed, as is occurring with the Posco steel mill. There has been hardly any public interest litigation in India in the last decade, although the Supreme Court of India retains continuing jurisdiction over forest management to implement its 1995 Godavarman decision.

Tseming Yang described the structure of the Chinese legal system and Chinese environmental laws. I discussed five developments in Chinese environmental policy: (1) Increasing awareness of the need to combat climate change, as reflected in the 12th Five Year Plan the government adopted last month, (2) The growth of environmental courts in the provinces, (3) civil society initiatives to encourage multinational companies to “green” their supply chains in China, (4) increasing production and consumption of asbestos in China despite the trend in the developed world to ban its use, and (5) the possibility that Chinese companies may become targets of transnational litigation over their resource extraction practices in Africa and South America.

I also noted that China and India are relying heavily on construction of nuclear powerplants to supply their future energy needs. China is beginning construction of 27 reactors and has 50 more in stages of planning. India has five under construction and 18 more in planning stages. Together the two countries account for more than 60 percent of new nuclear construction (37 of 60 plants under construction and 68 of 109 reactors in the planning stages worldwide). Max Colchester & Liam Moloney, Japan Crisis Dims Nuclear Plans, Wall St. J., March 30, 2011, p. A14. While both countries have indicated that they do not expect the Japanese nuclear accidents to affect their energy plans, China has temporarily suspended licensing and ordered a safety review. Last week Indian Minister of Environment and Forests Jairam Ramesh conceded that the possibility of a tsunami had not been considered in connection with planning for the Jaitapur nuclear power project to be constructed on the coast of the Arabian Sea in Maharastra state.

Copies of materials prepared for the Thursday sessions are available online at: http://www2.americanbar.org/calendar/section-of-international-law-2011-spring-meeting/Pages/Thursday.aspx. (Links to the panel’s materials can be found under the 2:30-4:00pm Thursday time slot).

On Tuesday April 19 the U.S. Supreme Court will hear oral argument in a climate change nuisance suit brought by several states against utilities with large coal-fired powerplants. The Court’s decision in American Electric Power v. Connecticut could have a major impact on the future of federal common law nuisance litigation. Meanwhile the Texas Senate voted last week to bar state common law nuisance suits based on emissions of GHGs. SB 875 would create an affirmative defense for anyone subject to such litigation so long as they are in compliance with their existing permits for emissions of air pollutants. The bill does not cover emissions that create a “noxious odor”.

Pace Environmental Courts Symposium, EPA Appropriations Riders, Obama Energy Speech & Tiger Comeback (by Bob Percival)

On April 1st and 2nd I participated in an International Symposium on Environmental Adjudication at Pace Law School. A terrific opening keynote address was delivered by Brazilian Supreme Court Justice Antonio Herman Benjamin, who spoke on “Judges, the Environment, and the Rule of Law.” I have known Justice Benjamin, who was the founder of Brazil’s Green Planet Society (an environmental NGO), since before his appointment to Brazil’s Superior Tribunal de Justiça by President Luiz Inacio Lula da Silva in 2006. Justice Benjamin contrasted two models of the role of the judiciary - the juiz espectader and the juiz protaganista. In the former a judge just performs a passive role of “calling balls and strikes” in enforcing property and contract rights, while seeking to avoid environmental controversies because of their technical nature. In the latter, judges acknowledge that they often must decide highly technical issues, like those posed by intellectual property law, and they treat environmental rights created by newly amended constitutions as more than merely cosmetic.

The conference also featured fascinating presentations by the Honorable Brian J. Preston, Chief Judge of the Land & Environment Court of New South Wales, Australia, and the Honorable Donald Kaniaru, who is directing the launch of the new Environmental Court of Kenya created by the country’s new constitution adopted in August 2010. Rock and Kitty Pring reported on their findings concerning the burgeoning movement to establish environmental courts throughout the world, offering a dozen guidelines for good practices to maximize the effectiveness of such courts.

I spoke on two panels at the conference - a panel on “The Rule of Law and Environmental Adjudication” and a panel on the “Capacity of Environmental Courts in China.” The first panel was chaired by Judge Meredith Wright of the Environmental Court of the State of Vermont. It featured presentations by Charles DiLeva of the World Bank and Ken Markowitz of the International Network on Environmental Compliance and Enforcement (INECE). I argued that whether or not countries establish specialized environmental courts, they need to resolve environmental disputes that often involve highly technical issues of environmental science. I traced the history of the U.S. federal courts’ involvement in environmental dispute resolution from the early transboundary pollution cases heard by the U.S. Supreme Court exercising its original jurisdiction over disputes between states. I noted that the federal courts often seek environmental experts to advise them, noting my own service as a special master presiding over a multi-week trial in federal court in a Superfund dispute. On the second panel I emphasized the difficulties China’s environmental courts face while operating in a country without an independent judiciary. Many of the federal regulatory programs to protect the environment in the U.S. were implemented only after citizen suits against the federal government, something that is unlikely ever to be authorized in China so long as the Communist party monopolizes power.

On Saturday April 2nd the speakers at the conference met with Professor Nick Robinson of Pace Law School to discuss a draft U.N. General Assembly Resolution to promote the development of environmental courts throughout the world. Justice Benajmin chaired the session and demonstrated a new website the Supreme Court of Brazil has created to facilitate contacts among judges throughout the world.

Fearful that the Obama administration might accede to appropriations riders restricting EPA’s ability to act, environmental groups last week launched a concerted effort to pressure the administration to threaten to veto them. By the end of the week the effort seemed to have borne fruit as Senate Majority Leader Harry Reid declared that the administration would not accept such riders as part of a budget agreement.

President Obama gave a major energy policy speech at Georgetown University last week, urging the country to shift away from imported foreign oil and to reduce U.S. consumption of it by one-third. This made President Obama the latest in a string of presidents to endorse such policies, even though they have had little success in the past.

At the opening of an International Tiger Conservation Conference last week the government of India released the results of a tiger census. The census showed that the number of tigers in the wild in India had climbed to 1,706, a substantial increase since the last tiger population estimate of 1,411 in 2007. The 2007 number did not include tigers in Sunderbans, making the actual increase somewhat smaller than it appears, but nonetheless a positive sign for tiger conservation efforts.

On Sunday I was in Charlottesville, Virginia for the University of Virginia Law School’s annual national law school softball tournament. This year 130 teams from 52 law schools competed in the tournament. One of Maryland’s coed teams advanced to the Elite Eight before losing to the University of Virginia. Florida Coastal won the coed division and UVA won the men’s division. Photos of the tournament are online at: http://gallery.me.com/rperci/100817