EU's New Climate Goals, Green Tea Coalition, Court Deals Blow to Arctic Drilling, China's Export Pollution, Tesla to Charge Same Price in China (by Bob Percival)

On January 22 the European Commission unveiled a new set of energy and climate goals through the year 2030.  The goals mandate a 40% reduction in greenhouse gas (GHG) emissions over 1990 levels with 27% of energy coming from renewables.  However, in a victory for industry groups and the UK, the targets leave it up to individual countries to decide how to achieve them rather than specifying increases in particular renewables.  The Commission also expressed concern over high energy prices in the EU, citing the need to maintain “mainstream competitiveness.”  It also rejected calls for EU-wide regulation of hydraulic fracturing in favor of voluntary guidelines. Christian Oliver & Pilita Clark, EU Sets Out New Climate Change Goals, Financial Times, Jan. 22, 2014.

Efforts to roll back state renewable energy measures in the U.S. are meeting fierce pushback from an unusual coalition of libertarian conservatives and pro-environment liberals.  These groups are opposing efforts by the right-wing American Legislative Exchange Council (ALEC) to get state legislatures to enact measures requiring special charges for those who install solar panels.  In Arizona former Congressman Barry Goldwater, Jr. worked with environmentalists to help reduce a planned $100/month charge for those using rooftop solar panels to $5/month. In Georgia the Sierra Club has teamed up with a Tea Party activist to form the “Green Tea Coalition”.  The Virginia General Assembly is moving to repeal a special charge on those who use hybrid vehicles.  John Schwartz, Fissures Emerge in G.O.P. as Some Conservatives Embrace Renewable Energy, N.Y. Times, Jan. 26, 2014, at A13.

On January 22 a divided panel of the U.S. Court of Appeals for the Ninth Circuit reversed a decision that had rejected challenges to the environmental impact statement (EIS) for oil and gas leasing in the Chukchi Sea off the northern coast of Alaska.  The court’s decision is available online at: http://cdn.ca9.uscourts.gov/datastore/opinions/2014/01/24/12-35287%20web%20corrected%202.pdf.  The court held that it was arbitrary and capricious for the Interior Department to rely on an estimate of only one billion barrels of recoverable oil in assessing the likely environmental impact of leasing 30 million acres of the continental shelf. The groups challenging the EIS now may move for an order canceling the existing leases, which would be a huge setback to efforts by Shell Oil to begin drilling in Alaskan Arctic waters.

Last week the Ninth Circuit also rejected a petition for rehearing en banc of its Rocky Mountain Farmers Union decision upholding California’s Low Carbon Fuel Standard against claims that it discriminates against interstate commerce.  See http://cdn.ca9.uscourts.gov/datastore/opinions/2014/01/22/12-15131.pdf. Six judges dissented from the decision not to rehear the case.  It is likely that the plaintiffs will now seek review of the decision by the U.S. Supreme Court.

A study recent published in the Proceedings of the National Academy of Sciences finds transboundary air pollution caused by Chinese production of goods for export contributes between 12% and 24% of sulfate pollution in the western U.S.  The study finds that outsourcing of manufacturing to China may have improved air quality in the eastern U.S., while actually reducing air quality in the western U.S.  A copy of the study, Jintai Lin, et al., China’s International Trade and Air Pollution in the United States, is available online at: http://www.pnas.org/content/early/2014/01/16/1312860111.  Fours years ago, China’s representatives at global climate change negotiations argued that countries importing goods from China should bear responsibility for the greenhouse emissions their production generates, but they quickly abandoned that argument fearing it could be used to support climate tariffs.

Tesla announced last week that it has adopted a policy of charging the same pre-tax price for its all-electric vehicles in every country of the world.  This should provide a huge boost to Tesla sales in China, where luxury auto imports often cost more than twice the price in the U.S.  While China imposes heavy taxes on vehicle imports, most auto manufacturers still charge much higher pre-tax prices in China.  In a press release Tesla stated: “"If we were to follow standard industry practice, we could get away with charging twice as much for the Model S in China as we do in the US," but it announced that it would not do so.  Due to taxes of $36,700 per vehicle imposed by the Chinese government and transportation costs of $3,600, Tesla’s lowest price model still will sell for $121,370 in China, compared with $81,070 in the U.S. 

Last Thursday I presented a Legal Theory Workshop at Maryland on “The Role of Civil Society in Environmental Governance in the U.S. and China.”  I based the presentation on an article I have co-authored with Professor Zhao Huiyu of Shanghai Jiaotong University.  The article will be published in a symposium issue of the Duke Environmental Law and Policy Forum.  Today I am in Vancouver, B.C., en route to Bellingham, Washington.  On Wednesday I will deliver a World Issues Forum lecture on “The Global Environmental Challenge of China” at the Fairhaven College of Interdisciplinary Studies of Western Washington University.  An abstract of my lecture is available online at: http://www.wwu.edu/Fairhaven/news/worldissuesforum/14winter.shtml

Company Declares Bankruptcy after W.Va. Spill, Anti-Environment Riders in Budget Bill, Leaked IPCC Draft, Iranian Minister's Breakthrough Environment Speech Canceled (by Bob Percival)

Faced with lawsuits for the chemical spill that shut down water supplies for more than 300,000 people in the Charleston, West Virginia area, Freedom Industries, the company that owned the ruptured tank that caused the spill, filed for Chapter 11 bankruptcy on January 17.  The bankruptcy filing makes it unlikely that the company that was the source of the spill will be required to fully compensate victims of its harm.  Lawsuits also have been filed against West Virginia-American Water Co. for failure to prevent the chemicals from entering its water supply.  An article in today’s New York Times explores the lax state of environmental regulation in West Virginia that permitted hazardous chemicals to be stored in a poorly monitored tank employing ancient technology (rivets instead of welds) located in close proximity to the main water intake for Charleston.  Trip Gabriel, Michael Wines & Coral Davenport, Chemical Spill Muddies Picture In a State Wary of Regulations, N.Y. Times, Jan. 19, 2014, at A1.  The article notes that the spill has not tempered anti-EPA rhetoric by West Virginia’s elected officials, who continued to rail last week against overzealous federal regulators.  It notes that Randy C. Huffman, West Virginia’s secretary of environmental protection, boasted in May 2009 that his department had brought an enforcement action against PPG Industries for illegally dumping mercury only in order to bar two environmental groups from bringing citizen suits against the company.

Last week U.S. House and Senate negotiators unveiled a $1.1 trillion appropriations bill that won bipartisan support to avoid another budget crisis.  The 1,582-page bill was unveiled on Monday night, passed the House by a vote of 359-67 on Wednesday, and the Senate on Thursday by a vote of 72-26.  President Obama then signed the measure into law.  The legislation contains some anti-environmental provisions inserted at the insistence of House Republicans.  It temporarily blocks EPA and the U.S. Army Corps of Engineers from spending money on the development of new rules related to mountaintop mining, and it temporarily bars expenditures on the enforcement of existing enhanced efficiency standards for light bulbs that effectively ban incandescents.  The latter may have little effect because most major suppliers already have discontinued the manufacture of incandescents and retailers are likely to continue to phase them out of their supply chains.  The budget legislation also tries to revive support by the U.S. Export-Import Bank and the Overseas Private Investment Corporation for construction of coal-fired power plants in countries such as India and Vietnam, a policy the Bank previously had repudiated.

A leaked draft of a report by the Intergovernmental Panel on Climate Change warns that 15 more years of failure to control emissions of greenhouse gases will make the climate change problem impossible to combat with current technologies.  The report finds that technologies would have to be developed to remove greenhouse gases from the atmosphere and store them underground in order to preserve the livability of the planet.  It decried the fact that despite increasingly alarming evidence of climate change more money still is spent each year to subsidize the use of fossil fuels than to promote a shift to cleaner energy sources. Justin Gillis, U.N. Says Lag in Confronting Climate Woes Will Be Costly, New York Times, Jan. 16, 2014.

Masoumeh Ebtekar, head of Iran’s Department of Environment who is the country’s leading female politician, had planned to speak at the country’s Friday Prayers on why environmental protection is a religious imperative under Islam.  The speech would have represented a major breakthrough at the Friday Prayers for women, moderates and the environment, who are disfavored by the fierce conservatives who run the weekly event.  However, Ebtekar reported on her Twitter feed (https://twitter.com/ebtekarm) that at the last minute the speech “was canceled for reasons that [I} do not know.“  The Iranian Student News Agency (ISNA) subsequently has published a text of the speech Ebtekar had planned to deliver (see http://isna.ir/fa/news/92102816069/متن-سخنرانی-لغو-شده-ابتکار-در-پیش-خطبه-نمازجمعه).  In 1979, at the age of 19, Ebtekar served as the spokesperson for Iranian students who stormed the U.S. embassy in Tehran and held its personnel hostages for 444 days. She now is considered a leading moderate and reformer in the Rouhani administration.

Our spring semester classes started on Monday January 13.  This semester I am teaching my Global Environmental Law seminar and first year Constitutional Law.  I have 30 students in my seminar and 66 students in my Constitutional Law class.  Last Monday a group of 15 first-year students from my Con Law class joined me at the U.S. Supreme Court to watch the oral argument in NLRB v. Canning, the case involving the constitutionality of President Obama’s recess appointments to the National Labor Relations Board.  The argument was one of the most interesting that I have seen with the Justices struggling with basic issues of constitutional law that they had not previously addressed.  After the argument, the students joined me for lunch at my home on Capital Hill.  Next weekend I am traveling to Seattle and Vancouver, British Columbia, before delivering a World Issues Forum Lecture at Fairhaven College of Interdisciplinary Studies in Bellingham, Washington (http://www.wwu.edu/Fairhaven/news/worldissuesforum/14winter.shtml). 

Japanese Antarctic Whaling Protested, W.Va. Oil Spill, China Destroys Ivory, BP Settlement Upheld, U.S. Supreme Court to Hear CERCLA Case (by Bob Percival)

On January 6 the Sea Shepherd organization released video taken from its protest vessel the Steve Irwin that it claimed shows Japanese whalers illegally killing whales in a protected area off the coast of Antarctica.  The video showed protected minke whales on the deck of the factory ship Nishin Maru.  After protests by Sea Shepherd and the government of New Zealand, which administers the Ross Dependency where the whaling allegedly occurred, the Japanese whalers relocated 400 miles away from the protected area.  Last year the International Court of Justice heard a lawsuit brought by New Zealand claiming that Japan is violating the ban on commercial whaling under the guise of “scientific research.”  The Court is expected to issue a ruling in the case this year.

Hundreds of thousands of residents of West Virginia were without water as a result of a toxic chemical spill in the Elk River that contaminated public water supplies in Charleston and nine surrounding counties.  The spill was caused when a tank containing thousands of gallons of a chemical used in coal processing ruptured on the morning of January 9.  Little is known about the human health effects of exposure to the chemical, 4-methylcyclohexane methanol.  Freedom Industries, where the leak occurred, apparently did not inform authorities about the spill until its contamination of the Elk River had spread to Charleston’s public water supply.  Having contaminated the water distribution system, the chemical will need to be flushed from the entire system, which may take considerable time.

On January 6 Chinese authorities made a public display of destroying six tons of confiscated ivory in Dongguan, China.  The destruction of the ivory was highly publicized to respond to criticism that Chinese consumer demand for ivory has fueled illegal elephant poaching around the world.  Wildlife conservation officials had high praise for the move as a sign that the Chinese government may become more aggressive in enforcing global agreements to curb the ivory trade. Bettina Wassener, Destruction of Ivory by China Wins Praise, N.Y. Times, January 7, 2013, at A4.

On January 10 the U.S. Court of Appeals for the Fifth Circuit upheld the settlement BP had reached for the 2010 oil spill in the Gulf of Mexico.  By a vote of 2-1 the court rejected BP’s effort to reinterpret the settlement to restrict the parties eligible to receive compensation under it.  Judge Emilio Garza dissented from the majority’s conclusion that BP had to bear the consequences of its broad settlement even if it meant that compensation is paid to some who lack proof that the spill actually caused them harm.

On Friday the U.S. Supreme Court announced that it will hear a case involving an unusual provision of the U.S. “Superfund” statute (the Comprehensive Environmental Response, Compensation and Liability Act, or “CERCLA”).  Section 309 preempts state law to require that state statutes of limitations are tolled until a plaintiff discovers that he has been the victim of exposure to a hazardous substance.  The novel question CTS Corp. v. Waldburger is whether Section 309’s preemption also applies to statutes of repose.  Statutes of repose are broader than statutes of limitation because they bar lawsuits after a certain period of time has passed from a date unrelated to the act causing injury.  Citing CERCLA’s broad remedial purposes, the Fourth Circuit held that North Carolina residents who did not discover chemical contamination of their wellwater until after a statute of repose had expired could still sue the company responsible for it.

On Wednesday afternoon I gave a talk on climate change to the Public Affairs Forum at Roland Park Place, a retirement community in Baltimore.  I was delighted to have a sophisticated and enthusiastic audience that included my host Bill Nagle, formerly of the World Resources Institute, my former colleague Clinton Bamberger, Richard Springer, who as a State Department official helped negotiate the Convention on Long-Range Transboundary Air Pollution, and Janet Gerber, who established an environmental litigation fund for Maryland’s Environmental Law Clinic.  On Wednesday night I had dinner with my old friend Dan Guttman who is back in the U.S. this month before resuming his teaching and public interest policy work in China next month.

Top Developments in Global Environmental Law in 2013 (by Bob Percival)

Happy 2014.  Global environmental law continued to grow in 2013 in a manner that made it one of the most interesting fields of law.  Below is a review of what I consider to be some of the top developments in the field during the past year.

January 2013 featured an “airpocalypse” in China, the first of several incidents of air pollution so severe that considerable economic activity had to be shut down.  These incidents spurred renewed determination by China’s national government to tighten air pollution standards and to permit greater public debate concerning the country’s environmental problems.  In March 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). In April the Global Burden of Disease study published in the Lancet estimated that 1.2 Chinese died prematurely in 2010 due to exposure to air pollution.  Despite increased attention to air pollution in China, Shanghai was gripped with severe air pollution outbreaks in December.

From the standpoint of traditional international environmental law, the top development in 2013 was the successful conclusion in January of negotiations by representatives of more than 140 nations on the United Nation’s Minimata Convention on Mercury. In October 2013 nearly 100 nations gathered in Japan to sign the convention.  While the convention will not end mercury use right away, it has set in motion a global process to phase out mercury use over the next 30 years.  In November the U.S. became the first country to deposit articles of acceptance of the convention, a development made possible because U.S. law already authorizes the actions necessary for the U.S. to implement the convention.

In May it was discovered that concentrations of carbon dioxide in the atmosphere have passed 400 parts per million (ppm) for the first time since the Pliocene Epoch several millions of years ago.  This discovery was made by scientists at Hawaii’s Mauna Loa observatory.  The 400 ppm level is a dramatic increase from the level of 316 ppm measured at Mauna Loa in 1958. While little progress was made in global climate negotiations (COP-19) in Poland in November, President Obama made action to control U.S. emissions of greenhouse gases (GHGs) a major priority for his second term that began in January 2013.  He began the year by emphasizing the importance of responding to climate change in both his inaugural and State of the Union addresses and in June he unveiled the President’s Climate Action Plan.  The Plan details actions that the president and executive agencies will take to use existing law to regulate GHG emissions, including EPA’s issuance of regulations that will make it impossible to build new coal-fired power plants unless they use carbon capture technology.  At a summit meeting held in California in June, President Obama and Chinese President Xi Jinping agreed to phase down production and consumption of hydrofluorocarbons (HFCs), a potent greenhouse gas, pursuant to the Montreal Protocol on Substances that Deplete the Ozone Layer.

Meanwhile China made further progress toward implementing a national cap-and-trade system by launching pilot cap-and-trade projects in several cities. The EU tweaked its existing carbon trading system to increase the value of allowances. Australia’s new premier Tony Abbott who won election in September lost little time in seeking to roll back the country’s carbon tax and other environmental measures.

After agreeing in 2012 to a generous settlement to compensate victims of its 2010 oil spill in the Gulf of Mexico, BP in 2013 fought the extent of its liability for civil penalties in a trial in federal court in New Orleans.  It also sought to reinterpret the terms of its settlement to limit escalating settlement payments, launching a major ad campaign attacking how the settlement is being implemented. These developments unfortunately undermined what had appeared to be BP’s new model for a major oil company to respond to a catastrophic spill, which previous had stood in sharp contrast to Exxon’s aggressive, decades-long fight over its liability for the March 1989 ExxonValdez oil spill in Alaska.  In December the first BP employee to be tried on criminal charges was convicted of obstruction of justice for destroying emails.

Transnational environmental liability litigation suffered another blow in April when the U.S. Supreme Court in its Kiobel decision narrowed the reach of the Alien Tort Statute (ATS).  The Court’s 5-4 majority struggled to apply the presumption against extra-territorial application of domestic law to the ATS, an unusual law that was enacted before the presumption was created and that expressly was designed to facilitate transnational litigation.  Ironically during the fall a federal district court in New York where plaintiffs had sought two decades ago to bring an ATS suit that Chevron had deflected to Ecuador, held a RICO trial where Chevron seeks to have the Ecuadoran court’s multi-billion dollar liability judgment declared the product of a corrupt conspiracy.  In December the Ontario Court of Appeals stunned Chevron by allowing an action to proceed to enforce the Ecuadoran judgment against it.

For many people like me, 2013 was the year when green technology came into its own.  I took delivery of my all-electric Tesla S Performance car in early May.  I have now driven it more than 8,500 miles while paying virtually nothing for fuel (charging was free at the chargers I used except for a charging station in Charlottesville, Virginia).  Last spring Tesla stunned Wall Street by revealing that it had sold more than 10,000 all-electric cars in 31 countries while making a profit.  After jumping more than six-fold in a few months, Tesla’s stock price ended the year more than four-fold higher than at the end of 2012.  Stung by the fact that Tesla’s success undermined the right’s narrative that green technology is a failure, the editors of the Wall Street Journal continued to condemn Tesla’s American business success story, even though the company repaid its federal loans with full interest nine years before they were due.  In November the results of the Two Team Project of the Confederation of European Paper Industries revealed technological breakthroughs that could dramatically reduce the future environmental footprint of the paper industry.

Global energy markets continued to be roiled by the expansion of hydraulic fracturing that greatly increased oil and natural gas production, particularly in the U.S., and the aftermath of the Fukushima Daiichi nuclear accident that dimmed the prospects for an expansion of nuclear power.  Coal use increased in China, but the Chinese government took steps that eventually will limit use of that fuel.

While there was a pause in efforts by oil companies to drill in the Alaskan Arctic, Greenpeace’s protest against Russian drilling in the Arctic resulted in the seizure of 30 protesters in September.  After initially charging the Greenpeace 30 with piracy and holding them for months, Russian authorities released them in late December as a result of a pre-Sochi Olympics amnesty adopted by the Russian Parliament. Little noticed in the controversy was the fact that Russia defied an order from the International Tribunal for the Law of the Sea to release the Greenpeace protest vessel, the Arctic Sunrise.

I just returned from New York City where I attended the annual meeting of the American Association of Law Schools (AALS).  On Saturday January 4 I co-hosted a side event at the Midtown Executive Club to promote the work of the IUCN Academy of Environmental Law.  Professor Nick Robinson of Pace University Law School joined me in co-hosting the event, which attracted a full house of environmental law professors.  I spoke about the history of the Academy and showed photos from the last ten of the Academy’s eleven colloquia.  A highlight of my time in New York was a visit with Nick to the Century Club, which features extraordinary paintings by Albert Bierstadt, Frederic Edwin Church, John Frederick Kensett and other artists from the Hudson River School.