Chinese Pollution Costs 3.5% of GDP, IMF Attacks Energy Subsidies, EPA Clean Fuel Rule, Golden Tree Awards (by Bob Percival)

Last week the Chinese Academy of Environmental Planning estimated that the cost of environmental damage in China in 2010 had risen to $230 billion, 3.5% of the country’s gross domestic product (GDP).  This estimate is nearly four times greater than the $62 billion in environmental damage calculated for 2004, which then represented 3.05% of China’s GDP.  In 2010 it was estimated that the cost of environmental damage in China had risen in 2008 to $185 billion.  Most economists view these estimates as underestimates of actual environmental damage because the researchers lack considerable important data. On March 28 the Beijing government released a plan to invest $16 billion to upgrade its sewage treatment and garbage incineration facilities and to promote reforestration.  Edward Wong, Cost of Environmental Damage in China Growing Rapidly Amid Industrialization, N.Y. Times, March 30, 2013, at A4.

On March 27 economists with the International Monetary Fund (IMF) issued a report criticizing global energy subsidies.  Reviewing a database of 176 countries, the economists estimated that countries spend approximately $1.9 trillion each year on subsidies to reduce energy prices.  The report, “Energy Subsidy Reforms -- Lessons and Implications,” argues that energy subsidies are counterproductive as a means for helping the poor because their benefits flow more to rich consumers who use more energy.  It estimates that in low- and middle-income nations the 20 percent richest households receive six times more in energy subsidies than the 20 percent poorest.  The report argues that energy subsidies harm the environment and cost governments substantial revenues at a time of chronic government deficits.  The three countries with the largest energy subsidies are the United States ($502 billion), China ($279 billion), and Russia ($116 billion).  The report is available online at: http://www.imf.org/external/np/pp/eng/2013/012813.pdf

On March 29 the U.S. Environmental Protection Agency (EPA) proposed new rules to require oil refiners to reduce the amount of sulfur in gasoline by two-thirds (from 30 to 10 parts per million).  The rules essentially will extend the strict standards applied to gasoline in California to the entire U.S.  EPA estimates that by the year 2030 the new rules will save 2,400 lives per year while reducing childhood respiratory illnesses by 23,000 annually, producing net benefits to society ranging from $8 billion to $23 billion per year.  It is estimated that the rules will increase the cost of gasoline by 1 cent (EPA estimate) to 8 cents (industry estimate) per gallon.

On March 27 the University of Maryland Environmental Law Program held its annual “Golden Tree” award ceremony for films made by students in my Environmental Law class last fall.  This year students made nine films that addressed a wide variety of topics including the environmental effects of methamphetamine labs, the environmental justice implications of pollution in Baltimore Harbor, offshore wind energy, natural gas exports, invasive species, and the effects of climate change on the wine industry.

The film that captured the most Golden Trees was “Beware the Beasts of the Ballast” by Matthew Jacobs, Phillip Chalker, Christopher Collins and Lisa Piccinini.  It won Golden Trees for Best Acting, Best Animation/Special Effects, and Best Use of Humor. “Maryland’s Offshore Wind Debate” by Tom Blonkowski, Alana Wase, and James Miller won the Golden Tree for Best Narration.  One of the most thought-provoking films was “The Environmental Effects of Methamphetamine Labs” by Gina Fioravanti and Chelsea Treadwell.  It won Golden Trees for Most Educational film and Best Interviews.

The film “Controversy at Calvert Cliffs: The Implications of Natural Gas Exports” by Dawn Leung and Mona Zhe won a Golden Tree award for Best Cinematography. “Business for a Better Baltimore” by Mollie Rosenweig & Fernando Guerra won the Golden Tree for Best Sound.  Best Picture honors were captured by Cassandra Miranda Villardes’s film “Here Comes the Oyster,” which also won the Golden Tree for Best Screenplay.

Other films included “Environmental Justice and the Baltimore Harbor” by Ilana Kerner, George Aguilar, and Adam Janet, which interviewed Baltimore Harborkeeper Tina Meyers, and “Climate Change You Can Taste,” a film about the impact of climate change on the wine industry by Emma Currin, Jacqueline Lynch, and Kevin Kellogg.

Thank you to our judges: Prof. Taunya Banks, John Brosnan, Dominic Dachille, Sonja Gloeckle from the Voice of America, Prof. Kathleen Hoke, former Program Coordinator Laura Mrozek, Mark Nevitt, and Jill Smith. This year’s Special Judge’s Award, proposed by judge Jill Smith, was the “Blair Witch Shaky-Cam Award Inspired by Dramamine.”  It was awarded to “Baltimore Climate Action Plan” by  Christine Hein and Kate Matthews.  Photos of some of the award-winning student filmmakers and a video of the winning film "Here Comes the Oyster" can be viewed by visiting the March 30, 2013 blog post on my parallel blog at: http://www.globalenvironmentallaw.com

India Enforcement Conference, Supreme Court Exempts Logging Road Runoff, Private Fracking Regulation Initiative (by Bob Percival)

Last week I was in Kolkata, India to speak at an International Conference on Environmental Compliance and Enforcement -- the Emerging Global Trend.  The conference was co-sponsored by the West Bengal Pollution Control Board and the Environmental Compliance & Assistance Centre of West Bengal with funding from the World Bank.  I was the opening speaker at the conference, which was attended by more than 300 people, including environmental enforcement officials from India’s state pollution control boards, several representatives of industries in India, and some NGOs.  In my opening talk on “Environmental Enforcement in an Era of Globalization” I reviewed how NGOs and enforcement officials throughout the world are increasingly coordinating their actions to improve the effectiveness of enforcement efforts.  Other presentations were made by enforcement officials from India, Sweden, Norway, Australia, and Kenya. The only other speaker from the U.S. was Apple Chapman, a former student of mine, who is the associate director of air enforcement at the U.S. Environmental Protection Agency’s Office of Civil Enforcement.  She gave a terrific talk displaying how technology is being used to help enforcement officials detect air emissions.  A copy of the conference program is available online at: http://www.wbpcb.gov.in/html/ICECE_2013_ProgramSchedule.pdf.  The conference was organized by Professor Binay K. Dutta, Chairman of the West Bengal Pollution Control Board. I was a member of the International Advisory Committee he recruited to help plan the conference.

In addition to speaking at the opening and closing sessions of the conference on March 19 & 20, I gave a lecture to a group of Indian law students at the West Bengal National University of Juridical Sciences (WBNUJS) on March 20.  Vice Chancellor P. Ishwara Bhat of WBNUJS introduced me to the students.  We had a nice dialogue after my presentation including a discussion of what India’s role should be in global efforts to control climate change.  The West Bengal Pollution Control Board has posted slides from the presentations online at: http://www.wbpcb.gov.in/html/icece_presentation.shtml and photos of the conference at: http://www.wbpcb.gov.in/html/icece_photos/.  My album of photos from my trip to India is available by going to my parallel website at: http://www.globalenvironmentallaw.com and clicking on the “Photo Albums” link at the top of the page.

On March 20 the U.S. Supreme Court decided Decker v. Northwest Environmental Defense Center, a case argued on December 3 (see Dec. 9, 2012 blog post).   The case involved the question whether timber companies need Clean Water Act permits to control stormwater runoff from logging operations that flows through ditches and culverts along logging roads.  Three days before the argument the U.S. Environmental Protection Agency (EPA) promulgated regulations clarifying that such runoff did not require a stormwater permit. The Court ruled that EPA’s pre-existing regulations, which also provided that such runoff would not require a Clean Water Act permit, were entitled to judicial deference.   All eight Justices voting in the case (Justice Breyer recused himself because his brother had heard the case when it was before the district court) agreed that a Clean Water Act permit was not required, though Justice Scalia in a separate opinion objected to the type of deference the Court said it was affording the EPA regulation.  A copy of the decision is availabe online at: www.supremecourt.gov/opinions/12pdf/11-338_kifl.pdf.

On March 20 the Environmental Defense Fund, Shell Oil and Chevron announced the formation of a new Center for Sustainable Shale Development (CSSD) (www.sustainableshale.org).  The Center, which will be based in Pittsburgh, will promote voluntary industry efforts to ensure that hydraulic fracturing is conducted in an environmentally responsible manner.  The Center announced that it had established 15 initial performance standards to protect air and water quality from fracking operations.  CSSD will operate an independent, third--party certification process to certify that firms in Pennsylvania, West Virginia, and Ohio are voluntarily complying with the standards, which are not legally enforceable.  The Sierra Club criticized the agreement for perpetuating the nation’s reliance on fossil fuels, which it stated would harm the environment even with the best controls in place.

In other global environmental news during the last two weeks:

The Conference of the Parties to the Convention on International Trade in Endangered Species approved new protections for endangered shark populations.

President Obama proposed using $2 billion from federal oil and gas royalties to fund research on alternative fuel vehicles.  

A proposal by the European Food Safety Authority to restrict the use of neonicotinoid pesticides that have been linked to a decline in bee populations failed to win approval when Britain and Germany abstained during a crucial vote in the European Commission. Thirteen countries voted in favor of the proposal, nine opposed it and five abstained.

On March 19 the British government approved the construction of the first new nuclear power plant in nearly 20 years. The plant will be constructed at Hinkley Point in southwestern England.

On March 20 BP declined to bid on new leases of tracts of the Gulf of Mexico for offshore drilling, indicating that the company is not close to resolving its debarment by EPA from receiving federal contracts.

Chinese solar panel manufacturer Suntech Power Holdings Co. filed for bankruptcy in China due to the plunging prices it was receiving for new solar components.

The Natural Resources Defense Council reported on March 15 that populations of 21 of 44 fish species protected by the 1996 amendments to the Magnuson-Stevens Act have met rebuilding targets and 7 more are making significant progress.

Spring Break Environmental Field Trip in Israel (by Bob Percival)

Last week I was in Israel with Julie Weisman from the Water Resources Action Group, a non-profit that works on Middle Eastern water issues, and a group of University of Maryland students.  The group, which included students from my Global Environmental Law seminar, spent spring break studying environmental issues in the Middle East.  On Sunday we traveled from Tel Aviv to the Arava Institute for Environmental Studies, which is located in the Negev desert on a kibbutz 30 miles north of Eilat, the southernmost city in Israel.  On Sunday March 10 Dr. Elli Groner, an ecologist, gave us an opening presentation on the work of the Arava Institute.  He noted that this has been one of the wettest years in the Negev, which has resulted in some interesting ecological changes.  A panel of students then discussed the projects on which they are working.  The Arava Institute pairs Israeli, Arab and foreign students in teams to emphasize the need to overcome political differences in addressing the environmental issues that afflict the Middle East.

On March 11 we toured Kibbutz Keturah where the Arava Institute is located.  Because of the intense sun in the Negev the kibbutz hosts a facility where various designs of new solar panels are tested.  We visited Israel’s first solar power plant, which is located on the kibbutz and run by the Arava Power Company.  The project has been such a success that it will be expanded dramatically over the next year.  The kibbutz also runs a biogas facility. We saw the world-famous Methusaleh Palm grown from an ancient seed discovered during the excavation of Masada.  We also visited an algae factory operated by the kibbutz that is used to produce an antioxidant that sells for $5,000 to $6,000 per kilogram.  Following our tour, Julie and I met with the leadership of the Arava Institute to discuss opportunities for student exchanges.

Our group spent the afternoon of March 11 attending a class on water resource management taught by Dr. Clive Lipchin.  He gave an excellent lecture on water problems in the Middle East and the need for basin-wide water management structures, which are very difficult to establish given the political conflict between Israel and its neighbors.  Israel is investing in desalination projects and efforts to recycle water are increasing throughout the region.  On the evening of March 11 we attended a briefing on a new project to recycle grey water from the dormitories at the Arava Institute, on which construction would commence on March 12.  Our students then joined students from the Institute in an Arabic lesson followed by salsa dancing.

On March 12 Dr. Lipchin took us on a field trip to the Dead Sea.  We stopped at the Dead Sea Works, a major industry in Israel that extracts potash and magnesium from the mineral-rich waters at the south end of the Dead Sea.  Dr. Lipchin then took us up close to view some of the giant sinkholes that are forming as the waters of the Dead Sea recede by one meter per year.  We then took a dip in the Dead Sea at a resort on its north end where we had lunch.  The students and I experienced the phenomenon of being unable to sink in the extremely salty waters.  

We spent the evening of March 12 in Jerusalem where Julie had arranged a meeting with Richard Laster, an Israeli environmental activist who teaches as an adjunct at Hebrew University.  He and his friend Mohammed, who joined us for dinner, have been part of a coalition trying to get a sewage treatment plant built to treat sewage from East Jerusalem.  They have made amazing progress in winning approval for the plant, but still are thwarted for now by the Israeli government’s fear of its implications for future negotiations over the status of Jerusalem.

On March 13 our group toured the Old City of Jerusalem.  I discovered a shop selling t-shirts that claimed that it had every American sports team’s logo in Hebrew.  But when I asked for a Washington Nationals t-shirt they said they had never heard of the team.  I pointed out that the Nats had won the most games in baseball’s regular season last year and that they are owned by the Lerners, a Jewish family.  The shopowner then told me not to leave while he confirmed my assertions about the team on the internet.  WIthin 10 minutes he had made me a Nats t-shirt in Hebrew and promised to make a second such shirt to display in his shop window.

Our group drove back to Tel Aviv in the late afternoon of March 13.  On March 14 we spent the day at Bar Ilan University where we met with professors and students from the university’s Environmental Law Clinic. Professor Oren Perez gave us an excellent presentation on environmental problems in Israel and the evolution of Israeli environmental law.  Professor Galit Ofer, director of the clinic, then gave us a presentation on the clinic’s work.  Israel has very liberal standing requirements, but it does not have a student practice rule so the clinic students cannot serve as actual lawyers.  However, students in the clinic provide tremendous assistance to the clinical professors and other lawyers who handle the clinic’s cases. One important issue on which the clinic is focusing involves petroleum leaks from underground storage tanks. We had a very useful  discussion comparing environmental law in the U.S. and Israel and discussing how petroleum tanks are regulated in the U.S. and recent U.S. litigation involving such tanks. 

On Thursday evening March 14 I hosted a farewell happy hour for our group in the executive lounge of the Renaissance Hotel.  Afterwards I met Israeli lawyer Asaf Pink to discuss the growth of public interest class action litigation in Israel.  I learned a lot on this trip and I was really inspired to see so many people working together to address the many challenging environmental issues that the Middle East faces.  An album of photos from the trip can be viewed by going to my parallel blog at: http://www.globalenvironmentallawcom and clicking on “Photo Albums” at the top of the opening page.

There were several interesting developments in global environmental law last week, which I will cover in next week’s post.  Right now I am in Mumbai, India, on my way to Kolkata where I will be speaking at a conference on environmental enforcement hosted by the government of India.

Israel Field Trip, McCarthy to Head EPA, CITES COP, China Leadership Transition, Australian Climate & BP Settlement Rises (by Bob Percival)

On Thursday evening I flew to Tel Aviv to start a spring break field trip to Israel with a group of University of Maryland students, including students from my Global Environmental Law seminar. Co-leading the trip with me is Julie Weisman, a New York attorney who works on Israeli water issues with the Water Resources Action Project (http://www.wrapdc.org).  Tomorrow we are traveling to the Arava Institute of Environmental Studies (http://www.arava.org) in the Negev desert in southern Israel.  After a day of classes on Monday, we will make a field trip to the Dead Sea on Tuesday, explore Jerusalem on Wednesday, and then visit the Environmental Law Clinic at Bar Ilan University on Thursday.  

Last week President Obama made official his nomination of Gina McCarthy to be the next administrator of the U.S. Environmental Protection Agency. The nomination of McCarthy, the assistant administrator of EPA’s Office of Air and Radiation, drew widespread praise from the environmental community.  The President also announced the nomination of Ernest Moniz, head of MIT’s Energy Initiative, to be U.S. Secretary of Energy.  The two are widely expected to work together to control U.S. emissions of greenhouse gases.

The first week of the 16th Conference of the Parties to the Convention on International Trade in Endangered Species (CITES) was held in Bangkok last week.  The conference opened with calls for new efforts to combat overfishing, illegal logging and wildlife crime.  At the opening of the conference on March 3 Thailand’s prime minister Yingluck Shinawatra promised to crack down on the illegal export of ivory to China.  Huge demand for ivory from wealthy Chinese has fueled poaching of elephants in Thailand and Africa.  The conference also featured what was billed as the first comprehensive meeting of officials from global wildlife enforcement networks who discussed how to combat trans-national wildlife crime.  A proposal to ban international trade in polar bear parts was rejected at the conference on March 7. 

China’s annual National People’s Congress is now underway in Beijing.  This year’s meeting is particularly important because it marks an important leadership transition with incoming president Xi Jinping and incoming premier Li Keqiang replacing president Hu Jintao and premier Wen Jiabao.  The new leadership has acknowledged that environmental problems in China have become so severe that they must be a top priority for the new government.  Some now argue that pollution problems have replaced land disputes as the primary cause of social unrest in the country.  Despite the new leadership’s emphasis on protecting the environment, there are rumors that projects to dam the Nu River that previously had been vetoed by outgoing premier Wen Jiabao will be resuscitated after his departure.  

Last week the Australian government’s Climate Commission issued a report concluding that the extreme weather events the country has been experiencing are attributable in part to climate change.  The report, entitled “The Angry Summer” is available online at: http://climatecommission.gov.au/report/the-angry-summer/.  It notes that extreme weather events are occurring across much of Australia, “including record-breaking heat, severe bushfires, extreme rainfall and damaging flooding.”  The Commission reported that extreme heatwaves and catastrophic bushfire conditions “were made worse by climate change” and that it “is highly likely that extreme hot weather will become even more frequent and severe in Australia and around the globe, over the coming decades.”

In its annual report to shareholders last week, BP announced that the settlement it reached last year with private parties will likely cost it significantly more than the $7.8 billion it previously had estimated.  Last month BP estimated that costs under the settlement could run as high as $8.5 billion.  Although BP said last week that it could no longer estimate the final cost, based on claims processed so far, BP could end up paying as much as $11 billion under the settlement.  The judge supervising implementation of the settlement has rebuffed BP’s argument that settlement administration Patrick Juneau has been too generous in paying compensation for lost earnings by businesses and individuals.  Ed Crooks, BP Warns Spill Costs Will Soar, Financial Times, March 8, 2013, at 13.  The trial of BP’s civil liability to the federal and state governments and private plaintiffs who opted out of the settlement continued in New Orleans last week.

BP Trial, Shell "Pauses" Arctic Drilling, Keystone XL SEIS Released, Will on Alar, Russia Smoking Ban, Gore's "The Future" (by Bob Percival)

On February 25 the civil trial of claims against BP, Transocean and Halliburton for the 2010 Deepwater Horizon oil spill began in federal district court in New Orleans (see Feb. 24, 2012 blog post).  While conceding that it was negligent, BP claims that it was not grossly negligent and that much of the fault lies with the other defendants.  Plaintiffs argue that the spill could have been prevented, but that BP was under enormous pressure to cut corners in order to reduce costs and speed up production.  Further details surfaced about a reported $16 billion settlement offer from the governmental plaintiffs which would involve a $6 billion civil penalty (not tax deductible), $9 billion in tax deductible natural resources damages (effective after-tax cost of $5.9 billion), and a $1 billion contigency fund. Professor Percival gave an interview about the trial to BBC News (see http://www.bbc.co.uk/news/business-21548117).  He also was interviewed live on the BBC’s “Up All Night” program on February 26 (http://www.bbc.co.uk/radio/player/b01qx3rz - the interview begins at 1:36:54).

On February 27 Royal Dutch Shell PLC announced that it will postpone oil drilling in Arctic waters until at least the summer of 2014.  Although Shell has spent more than $5 billion over six years to obtain the permits that would allow it to drill, it has encountered severe problems in conducting the drilling in the face of horrendous weather and equipment failures.  Its Noble Discoverer drilling ship experienced an engine fire in December and on January 1 Shell’s drilling ship Kullak ran aground.  Environmentalists argue that Shell’s problems simply illustrate that it is too risky to drill in the harsh Arctic environment. 

On March 1 the U.S. State Department released its draft supplemental environmental impact statement (SEIS) on the proposed Keystone XL pipeline project.  The SEIS concludes that the project will have no impact on climate change because the carbon-intensive tar sands oil will be extracted even if the pipeline is not approved because the oil will be transported by rail or by a new pipeline through Canada to the Pacific Ocean.  Environmentalists argue that if President Obama vetoes the Keystone XL it will make it much more difficult for the tar sands to be developed. 


Last week Washington Post columnist George Will wrote a column decrying “The Manufactured Crisis of Sequester” that repeated what in some quarters has become an urban legend.  Citing public reaction to the discovery in 1989 that the apple supply was contaminated with the chemical Alar, Will claims that “Alar, was not, after all, a risk.”  Yet subsequent EPA testing revealed that Alar, also known as daminozide, was indeed carcinogenic and posed an “unacceptably high” risk that warranted its swift removal from the food supply.  Kimm, Alar’s Risks, 254 Science 1276 (1991).  Rather than trying to demonize the messenger, Will should be grateful that an alert public forced this chemical off the market.

Last week the Kremlin announced that Russian President Vladimir V. Putin had signed a law than bans smoking in most public places.  This could be particularly significant because the World Health Organization (WHO) estimates that 40 percent of Russian adults smoke.  The law will be phased in beginning on June 1, 2013.  It also raises taxes on tobacco products and restricts advertising of them.  David M. Herszenhorn, Putin Signs Law to Ban Most Public Smoking, N.Y. Times, Feb. 26, 2013.

This weekend I made my annual pilgrimage to Florida for Washington Nationals spring training.  I made it a little earlier than usual because I will be out of the country for the next two weeks, taking a group of my students to Israel to study Middle Eastern water resources issues and then speaking at an environmental enforcement conference in Kolkata, India.  Beginning on Friday night, my son and I watched the Nats sweep the weekend, beating the Braves on Friday and the Cardinals on both Saturday and Sunday.  While on the trip I have been reading Al Gore’s new book The Future.  The book outlines what Gore describes as six important trends that are shaping the future of the planetary environment - globalization of the world’s economy, globalization of communication technology, a new balance of power in the world, rapid unsustainable growth in resource consumption, new technologies that enable humans to redesign the molecular structure of all solid matter, and climate change.   While arguing that the democratic process has been “hacked” by monied interests, Gore argues that the internet offers hope for mobilizing citizens to combat these worrisome trends.