Chevron Rules Out Apology, China Cadmium Spill, WTO Rules Against China Mineral Export Tax, Malaysian Rare Earth Refinery (by Bob Percival)

On February 3 Chevron told the government of Ecuador that it did not intend to apologize for oil pollution damage in the Amazon for which it has been held liable by an Ecuadoran court. Under a judgment rendered a year ago, Chevron can reduce its liability from $18 billion to $9 billion by apologizing to the people of Ecuador for the pollution. Chevron spokesman James Craig said that an apology would be a “false admission of responsibility.”

In the wake of a cadmium spill that contaminated drinking water to millions, seven people in southern China have been fired. Two hundred miles of the Longjiang River in Guangxi Zhuang Autonomous Region were affected by the spill, which contaminated drinking water to millions. The fired officials included the head of the environmental protection board for the town of Hechi, which failed to report the spill and six officials from the Jinhe Mining Company and Hongquan Lithopone Factory, who were blamed for the spill. Andrew Jacobs, China Fires 7 Officials After Spill, New York Times, Feb. 4, 2012.

Last week an appellate body of the World Trade Organization (WTO) ruled that China’s policies to limit mineral exports, including export taxes, violated international trade rules. The case was initially brought in 2009 by the U.S., the European Union (EU), and Mexico, which challenged Chinese export taxes on bauxite, coke, zinc, fluorspar, magnesium, manganese, silicon carbide and yellow phosphorous. The complaining states believe the ruling should curb some of China’s efforts to limit exports of rare earth minerals. Joshua Chaffin & Alan Beattie, Financial Times, Jan. 31, 2012, at 6.

The world’s largest refinery for rare earth metals is about to be opened by Lynas, an Australian company, in Kuantan, Malaysia. Rare earth metals are important components of smartphones and wind turbines. Their prices soared after China slashed exports of the metals in 2010. The Malaysian refinery will generate approximately 20,000 tons per year of low-level radioactive waste. Despite protests by Malaysians, Lynas has failed to find a permanent disposal site for this waste. They plan to store it onsite for 20 years in pits lined with clay and plastic. Keith Bradshear, Rare Earth Metal Refinery Nears Approval, New York Times, Jan. 31, 2012.

On Monday evening January 30 I spoke to a graduate seminar on Environmental Reporting at Georgetown University’s main campus. The seminar is taught by Associated Press energy and environmental reporter Dina Cappiello. I spoke on what reporters should know about environmental law. On Thursday February 2 I joined John Cruden, president of the Environmental Law Institute, in reviewing the four environmental cases currently before the U.S. Supreme Court at the annual ALI/ABA conference on Environmental Law in Washington, D.C. I covered the PPL Montana and Kiobel cases while John reviewed the Sackett and Southern Union cases.

U.S. Court Rejects Chevron Appeal, China Air Monitoring, Apple Supply Chain, Peru Mine, New EPI Rankings, California Car Standards (by Bob Percival)

On January 26 the U.S. Court of Appeals for the Second Circuit released its decision rejecting Chevron’s efforts to reinstate an injunction barring global enforcement of en Ecuadoran court’s $18 billion judgment against the oil giant for oil pollution. Last September the court had lifted the New York federal district court’s injunction three days after hearing oral argument in the case. The decision, Chevron v. Naranjo, No. 11-1150-cv(L), concludes that New York’s Uniform Foreign Country Money-Judgments Recognition Act does not “grant putative judgment-debtors a cause of action to challenge foreign judgments before enforcement of those judgments is sought.” Thus Chevron can challenge the Ecuadoran judgment “only defensively, in response to an attempted enforcement – an effort that the defendants-appellees have not yet undertaken anywhere, and might never undertake in New York.”

The internet campaign that helped force Chinese authorities to agree to improve air quality monitoring was spurred in part by Chinese NGOs purchasing their own pollution monitors. Last May citizens in Beijing spent $4,000 to purchase their own air quality monitoring device and in December groups in Shanghai and Wenzhou followed suit, with the Wenzhou group selling oranges to finance their purchase. After data from these private monitors and from the U.S. Embassy’s twitter feed contradicted Chinese government claims concerning air quality, China’s Ministry of Environmental Protection agreed to release hourly readings of fine particulate levels in Beijing, while promising to set a standard to control them as soon as possible. Sharon LaFraniere, Activists Crack Wall of Denial About Air Pollution, New York Times, Jan. 27, 2012.

Chinese environmentalists have been exposing labor and environmental violations by companies that are part of the supply chains of multinational electronics companies, including Apple Inc. On January 25, the New York Times examined labor and safety conditions at an iPad manufacturing plant in Chengdu, China, where some workers were killed in an aluminum dust explosion last May. Charles Duhigg & David Barboza, In China, Human Costs Are Built Into an iPad, New York Times, Jan. 25, 2012, at A1. Apple CEO Tim Cook responded to the TImes article by sending an email to Apple employees on January 26. He stated: “We care about every worker in our worldwide supply chain. Any accident is deeply troubling, and any issue with working conditions is cause for concern. Any suggestion that we don’t care is patently false and offensive to us.” Apple certainly has the financial resources to correct health, safety and environmental problems with its supply chains. Last week it passed ExxonMobil as the most valuable company in the world and the company currently holds nearly $100 billion in cash, greater than the gross domestic products of more than half of the countries in the world.

On January 24 the government of Peru announced that it has selected three independent consultants to review the environmental impact of Newmont Mining’s $4.8 billion gold and copper mine. Work on the project, which is the largest foreign investment in Peru’s history, has been suspended for the last two months due to protests that blockaded the town of Cajamarca. Gregorio Santos, governor of the region where the mine is located, has called for the project to be canceled because of concerns over its environmental impact. Environmental protests in Peru have centered on mines and dams being built by foreign companies including the Tia Maria copper project (U.S. company), the Santa Ana silver project (Canadian company), the Inambari dam (Brazilian company), and the Tambo 40 hydroelectric project (Brazilian company). Naomi Mapstone, Peru Sets Up Close Scrutiny of Conga Mine, Financial Times, Jan. 25, 2012.

As the 2012 World Economic Forum convened in Davos, Switzerland last week, Yale researchers released their latest update of their Environmental Performance Index (EPI ), which seeks to rank countries on their environmental performance. Switzerland ranked first in the latest ratings, while Russia suffered the greatest decline to 106th place due to a breakdown in air and water pollution controls, increased overfishing and deforestation. Latvia moved into second place and showed the greatest improvement overall due to eliminating coal from its electrical supply mix and reforestation efforts. The complete rankings are available online at: http://epi.yale.edu/epi2012/rankings.

On January 24 President Obama delivered his third State of the Union address. He reiterated the administration’s commitment to promoting clean energy and defended EPA’s mercury rule. President Obama touted increased oil and gas production in the U.S. and reminded the audience that hydraulic fracturing that produced much of this increase was developed in part through federal support.

This week California’s Air Resources Board unanimously approved the Advanced Clean Car Program. The program will require a two-thirds reduction in auto exhaust emissions and the production of more than a million zero-emission vehicles for the California market by 2025. The rules are designed to reduce greenhouse gas emissions from vehicles by half by 2025. Peter Fimrite, State OKs Stringent Fuel Rules, San Francisco Chronicle, Jan. 28, 2012, at C1.

This week I attended the annual Macworld conference in San Francisco, the annual gathering of devotees of Apple products. The new product that holds the greatest interest for me is Apple’s iBooks Author software, which was announced on January 19. This app allows authors to create electronic textbooks with rich multi-media material that can be sold through Apple’s online iTunes store (http://www.apple.com/ibooks-author/). Although Apple no longer directly participates in the conference, vendors of supporting products were there in force selling things like an iPhone case that can open a beer bottle (intoxicase.com). Serendipitously, on Friday night I was able to attend a reunion of some of the members of the Beijing Environment and Energy Roundtable (BEER) who now are living and working in the San Francisco Bay Area. The gathering was organized in part by Alex Wang, who was with NRDC’s Beijing office when I lived there in 2008 and who now is a visiting professor at Boalt Hall. It was a great opportunity to catch up with Alex and other people who share a passion for China’s environment. I really appreciate their including me in the group.

Obama Nixes Pipeline, Shark Fin Ban Spreads in Asia, Vermont Yankee Wins Extension, U.S. Oil Production Surges (by Bob Percival)

On January 18 President Obama denied approval for the construction of the Keystone XL pipeline to transport oil from Canadian tar sands to refineries on the U.S. Gulf Coast. Environmentalists fiercely oppose the pipeline, which they argue would facilitate the use of the dirtiest, carbon-intensive fuel on the planet while threatening spills that would harm precious groundwater resources. Proponents of the pipeline argue that the pipeline project will create jobs and that the tar sands oil will be used whether or not the pipeline is built because Canada will instead sell the oil to China if the pipeline is not built. Canada currently is holding hearings on a plan to build a trans-Canada pipeline to the Pacific Ocean. While Canada’s First Nations tribes initially were united in their opposition to the proposed Canadian pipeline to the Pacific, many have dropped their opposition in return for a 10 percent equity share in the Canadian project. President Obama argued that the 60-day period Congress had given him to make a decision was too short in light of the need to study the environmental impact of a new route for the pipeline that would avoid Nebraska’s Ogallala aquifer. His decision does not permanently bar construction of the pipeline. The President indicated that he eventually would consider a new application subject to the normal timetable for environmental reviews.

Efforts to protect endangered sharks gained ground last week when the luxury hotel chain Shangri-La Asia Ltd. announced that it would ban shark fin from all the dishes served at its 72 hotels throughout Asia. Two weeks ago the large supermarket chains Carrefour and FairPrice announced that their Singapore stores will no longer sell shark fins. The popular South Beauty chain of restaurants in China also banned shark fins two months ago, as did the Peninsula Hotel chain. This represents a significant shift in Chinese attitudes from the time when I lived in Beijing in 2008. The restaurants are quite significant. I often ate at the South Beauty restaurant in Oriental Plaza and the Beijing Shangri-La Hotel’s Blu Lobster restaurant was absolutely the best in town. Four years ago, while dining at an upscale restaurant in the Oriental Plaza complex called My Humble House, an EPA attorney and I asked the waitress why they still displayed two pages of shark fin dishes on their menu despite Chinese basketball star Yao Ming urging people to stop eating shark fin soup. She replied, “then there will just be more for the rest of us to eat.”

Last week a Vermont federal district judge, Gavin Murtha, ruled that the Vermont Yankee nuclear power plant could continue operating despite efforts by the Vermont legislature to prohibit an extension of its operating license. The plant initially had been given a 40-year operating license that would expire in March 2012. But last March the U.S. Nuclear Regulatory Commission (NRC) approved a 20-year extension of the plant’s license, just as the Fukushima Daiichi nuclear accident was occurring in Japan. Judge Murtha ruled that Vermont’s efforts to prohibit an extension of the license were based primarily on safety concerns and thus are preempted by federal law and the NRC’s issuance of a license extension.

On January 23 the U.S. Energy Information Agency (EIA) issued its preliminary 2012 Annual Energy Outlook (see http://www.eia.gov/todayinenergy/detail.cfm?id=4671). The EIA reported that production of oil and natural gas has surged dramatically in the U.S. in recent years. Domestic crude oil production increased from 5.1 to 5.5 million barrels per day in 2010, more than in nearly any other country. Last year North Dakota produced more oil than OPEC member Ecuador. The EIA is forecasting a 20 percent increase in U.S. production of crude oil to 6.7 million barrels daily in 2010. Due to higher fuel economy standards and increased domestic production, U.S. petroleum imports are projected to decline from 49 percent of domestic liquid fuel consumption to 28 percent in 2020. In four years the U.S. is projected to become a net exporter of natural gas, due largely to expanding use of hydraulic fracturing. U.S. emissions of carbon dioxide in 2020 are expected to be 7 percent below their 2005 levels, though tighter fuel economy standards may reduce them even further.

A second call for papers has been issued for the 10th Colloquium of the IUCN Academy of Environmental Law, which will be held from July 1-5, 2012 at the University of Maryland Francis King Carey School of Law. The theme of the Colloquium is “Global Environmental Law at a Crossroads.” The deadline for submitting proposed speaker/paper abstracts has been extended to February 15, 2012. For details see: http://digitalcommons.law.umaryland.edu/gelc/

Sackett Oral Argument, Apple Supply Chain, EPA GHG Data, Rio+20 Draft (by Bob Percival)

On Monday January 9 the U.S. Supreme Court heard oral argument in Sackett v. EPA, a case raising the question whether recipients of an EPA administrative compliance order to stop filling wetlands can get pre-enforcement judicial review. Only a few months ago the Court had denied review of a similar issue involving the General Electric Company and a Superfund unilateral administrative order to clean up PCBs in the Hudson River. I attended the oral argument and it definitely did not go well for EPA. The government made little effort to rebut the Pacific Legal Foundation’s portrayal of EPA as an agency that seeks to dictate what people can do in their own backyards. The Natural Resources Defense Council had filed an amicus brief noting that no individual permit is needed to fill wetlands on properties that are less than half an acre (the Sackett’s property is .6 acres). But at the oral argument EPA was portrayed by the petitioners as an out of control agency trying to dictate what homeowners can do in their own backyards, leading Justice Alito to express anger that such an outrage could occur in the U.S.

While nearly everyone expects the Sacketts to win the case with the Court ruling that they can obtain pre-enforcement review of an EPA administrative compliance order, environmental pundits are split over how serious a blow this will be to enforcement of the Clean Water Act (CWA). Some believe that EPA will simply substitute informal warnings for compliance orders with little impact on enforcement because they will not trigger pre-enforcement review. Others contend that it will neuter an important tool for EPA to achieve compliance with the CWA. There was no real discussion at the argument of the importance of protecting wetlands or the consequences for enforcement if pre-enforcement review of compliance orders is mandated.

On January 13 Apple Inc. released its Apple Supplier Responsibility 2012 Progress Report. A copy of the report is available online at: http://images.apple.com/supplierresponsibility/pdf/Apple_SR_2012_Progress_Report.pdf. It reveals that Apple conducted 229 audits of its suppliers in 2011, up from 127 in 2010. Apple found that 62 percent of its suppliers had violated a 60-hour per week limit on working hours, 32 percent had failed to comply with hazardous substance management regulations, and more than 35 percent had worker safety violations. For the first time Apple published a list of its 156 leading suppliers, accounting for more than 97 percent of the company’s supply chain. The company also announced that it would join the Fair Labor Association which could conduct outside monitoring of its suppliers. Jessica E. Vascellaro & Owen Fletcher, Apple Navigates China Maze, Wall St. J., Jan. 14-15, 2012, at B1.

Now that an intermediate appellate court in Ecuador has affirmed the Lago Agrio judgment against Chevron, the oil company fears efforts to collect the $18 billion judgment. It has filed an emergency motion asking the U.S. Court of Appeals for the Second Circuit to reinstate an injunction barring enforcement anywhere in the world, it has renewed its motion with the Eastern District of New York’s federal court to grant pre-judgment attachment of any proceeds the plaintiffs receive, and it has asked the Permanent Court of Arbitration in the Hague to require Ecuador to document how it will comply with a ruling issued last February that the judgment could violate a bilateral investment treaty. Stay tuned.

Last week EPA released an interactive map of the nation’s largest emitters of greenhouse gases (GHGs) in 2010. The map, which can be accessed online at: http://ghgdata.epa.gov/ghgp/main.do, allows you to view the largest emitters in your state and to do custom searches for data on particular facilities. Three coal-fired power plants owned by the Southern Company are the top emitters of GHGs in the U.S. with each releasing more than 20 million tons of carbon dioxide. The EPA data include 6,700 facilities, including refineries and chemical plants, that emit more than 25,000 tonsof GHGs annually. Tennile Tracy, Three Southern Co. Plants Are Top Emitters, Wall St. J., Jan. 12, 2012, at B3.

Last week a federal district judge granted preliminary approval to a settlement of litigation against manufacturers of defective Chinese drywall. Knauf Plasterboard Tianjin Co., a Chinese manufacturer, agreed last month to establish a fund to repair 4,500 properties in Alabama, Florida, Louisiana, and Mississippi. The company also has established a $30 million fund to compensate for harm, such as health problems, caused by the defective drywall.

Last week the United Nations Rio+20 Conference Bureau released its “Zero Draft” of the document that will serve as the basis for negotiations at the Rio+20 conference in June 2012. The document, entitled “The Future We Want,” includes the suggestion that Sustainable Development Goals, similar to the Millenium Development Goals, be adopted by 2015 and it largely defers to the Durban Platform on climate issues. A copy of the draft is available online at: http://www.stakeholderforum.org/fileadmin/files/zerodraft110112.pdf

Ecuador Judgment Affirmed, Beijing Air Pollution, U.S. Toxics Releases Increase, Nigerian Oil Subsidies End (by Bob Percival)

Last week an appellate court in Ecuador upheld the $18 billion judgment against Chevron for oil pollution that had been awarded by a trial court in February 2011. The decision still can be appealed to Ecuador’s Supreme Court. The plaintiffs previously had told the U.S. Court of Appeals for the Second Circuit that they would not seek to enforce the judgment until the appeal in Ecuador was finished. Ecuador’s Supreme Court can still review the case and stay enforcement of the judgment if Chevron posts a multi-billion dollar bond. Naomi Napstone, Chevron Fights on Despite $18 Billion Ecuador Ruling, FInancial Times, Jan. 8, 2012, at 9.

The January 9th issue of the New Yorker features an excellent article on the Ecuador litigation against Chevron. The article, entitled “Reversal of Fortune: A Crusading Lawyer Helped Ecuadorans Secure a Huge Environmental Judgment Against Chevron -- But Did He Go Too Far?,” profiles plaintiffs’ lawyer Steve Donziger who has been involved in the litigation since 1993. Patrick Keefe, the author of the article, interviewed me for the article by phone for 40 minutes on November 25. We primarily discussed the legal issues involved in the case and I am not quoted in the article, which focuses largely on Donziger. I learned some interesting facts that I did not previously know, including that Donziger was in Barack Obama’s Harvard Law School class and about a prior settlement offer.

Last week the Beijing Municipal Environmental Protection Bureau announced that by January 23 it will provide the public with hourly PM2.5 data measuring the amount of small particulate (2.5 micron) air pollution in Beijing. The decision was announced after Chinese Environment Minister Zhou Shengxian toured Beijing’s air pollution monitoring facilities. As noted in previous blog entries, the U.S. Embassy has been tweeting air pollution readings that indicated that official Chinese data seriously underestimate the severity of air pollution in Beijing. Chinese officials maintain that Beijing experienced 286 “blue sky” days in 2011 compared with 252 such days in 2010. However, last Friday was officially reported as a “blue sky” day in Beijing even though the embassy’s tweets showed that pollution ranged from “very unhealthy” to “unhealthy”. The decision is viewed as one of the most important examples of Chinese officials bowing to public pressure expressed over the internet. Jeremy Page, Beijing Bows to U.S. On Air Quality Report, Wall St. J., Jan. 7-8, 2012, at A11.

On January 5 the U.S. Environmental Protection Agency (EPA) reported that releases of toxic chemicals into the environment increased by 16% in 2010 over 2009 levels. This was the first increase in toxic releases since 2006. EPA attributed most of the overall increase to the metal mining industry, but it also noted that releases from the U.S. chemical industry also had increased. Annual reporting of toxic emissions is required by the Emergency Planning and Community Right to Know Act (EPCRA). Juliet Eilperin, Toxic Releases Rose16 Percent in 2010, EPA Says, Washington Post, Jan. 5, 2012.

Last week China’s Tianjin Maritime Court agreed to hear a lawsuit brought by clam and sea cucumber producers against ConocoPhillips for oil pollution from offshore drilling in Bohai Bay. In June 2011 two leaks of oil and drilling muds occurred near a Conoco platform there. Conoco maintains that the contamination was mostly drilling muds that have been fully recovered, but Chinese authorities subsequently shut down oil production in the area. Conoco has stated that it will pay “reasonable compensation” to those harmed by the spill. CNOC, China’s national oil company, also announced last week that it had established a 500 million renminbi ($79 million) marine environmental fund. James T. Areddy, Chinese Court Accepts Offshore-Oil Lawsuit Against ConocoPhillips, Wall St. J., Jan. 3, 2012.

Gasoline prices soared last week in Nigeria as a result of the government ending fuel subsidies. The price of a liter of gasoline jumped from 65 naira (approximately 40 cents) to between 130 and 140 naira on January 2. This is the equivalent of a rise in gasoline prices from $1.50 to $5.00 per gallon. The Nigerian government announced that the $7.3 billion it had been spending annually on fuel subsidies could now be used to build schools, hospitals, and roads. Drew Hinshaw, Nigeria Braces for Gas-Price Protests, Wall St. J., Jan. 3, 2012, at A11. Responding to fierce protests generated by the end of the subsidy, the government announced that it would consider measures to reduce the cost of mass transit. It noted that oil subsidies had cost approximately one-quarter of the government’s annual budget and had contributed to corruption as much of the gasoline was resold at higher prices in neighboring countries. Drew Hinshaw, Kills of Christians, Protests Roil Nigeria, Wall St. J., Jan. 7-8, 2012, at A9.

On January 6 Japanese government officials announced that they would submit new legislation to the country’s Parliament to strengthen regulation of nuclear power. Goshi Hosone, the minister responsible for responding to the Fukushima Daiichi nuclear disaster, stated that the the legislation would mandate that Japanese nuclear power plants close after 40 years of operation while requiring plant owners to engage in “worst-case” analysis. Kelly Olsen & Phred Dvorak, Japan Plans Age Limits, Tougher Tests for Nuclear Plants, Wall St. J., Jan. 7-8, 2012, at A9.

Last week the annual conference of the American Association of Law Schools (AALS) was held in Washington, D.C. I spent Thursday afternoon at Aspen Publishers’ booth in the exhibit hall demonstrating their “SmartBook” technology that has been used to produce an electronic version of my casebook Environmental Regulation: Law, Science and Policy. The technology enables professors to annotate the book electronically and to embed links that provide a multi-media experience to students. It has proved wildly popular with the students who opted to use it.

Top 10 Developments of 2011, Setbacks for California & EPA Rules, China Dam & Steel Industry (by Bob Percival)

Happy New Year! In keeping with tradition on this first day of 2012 here are what I consider to have been the top ten developments in global environmental law in 2011 (in no particular order).

(1) The March 2011 Japanese earthquake and tsunami that caused the world’s most catastrophic nuclear accident since Chernobyl at the Fukushima Daiichi powerplant fundamentally changed attitudes toward nuclear power around the world. It spurred a renewed phaseout of nuclear power in Germany, caused many countries to rethink their nuclear safety standards, and stalled plans for construction of new nuclear powerplants. It is now estimated that it will take at least 40 years to clean up the damaged Japanese reactors.

(2) The February 2011 $18 billion judgment against Chevron by a court in Lago Agrio, Ecuador for oil contamination of the Oriente region by Texaco during the 1970s spurred what has become a truly epic legal battle over collection of the judgment. Alleging fraud, Chevron filed a RICO lawsuit against the plaintiffs and their lawyers in federal district court in New York and obtained an injunction against enforcement of the judgment that was later dissolved by the U.S. Court of Appeals for the Second Circuit. The plaintiffs countered by receiving hedge fund financing to enable them to hire additional legal counsel to combat the ever-expanding litigation. Ironically, the plaintiffs first brought the case in federal court in New York in the early 1990s, but it was transferred to Ecuador at the behest of the oil company on the grounds of foreign non conveniens.

(3) The rapid deployment of hydraulic fracturing (“fracking”) to release natural gas deposits trapped in underground rock formations has greatly expanded U.S. natural gas production. Despite concerns that the practice may pollute underground sources of drinking water it was exempted from the U.S. Safe Drinking Water Act by an amendment pushed by Vice President Cheney in 2005 energy legislation. The huge increase in domestic natural gas production has made the U.S. a net exporter of energy for the first time in more than half a century. France banned fracking while the state of New York imposed a moratorium on the practice until its risks can be better understood. Fracking controversies are now spreading to other countries. See Ian Urbina, Hunt for Gas Hits Fragile Soil, And South Africans Fear Risks, N.Y. Times, Dec. 30, 2011, at A1.

(4) The Republican Party’s “War on EPA” and fierce opposition to virtually any form of environmental regulation was on display in the party’s presidential primary debates and nearly 200 votes by the U.S House of Representatives to roll back environmental regulations. The Obama administration helped ensure that few of these initiatives became law, but it made a horrendous decision to postpone EPA’s revision of national ozone regulations in a misguided effort to defuse political controversy. Climate change denial became an article of faith among Republican presidential candidates even though some previously had recognized it as a serious problem. Expensive advertising campaigns by fossil fuel industries may help explain how this could occur even in a year that featured a dozen extreme weather-related disasters in the U.S. Extreme drought, heat waves, floods, unprecedented tornado outbreaks, hurricanes and wildfires caused at least $54 billion in damage in the U.S. and cost at least 620 lives. See http://www.noaa.gov/extreme2011/

(5) Efforts to forge a global agreement to control GHG emissions to combat climate change resulted in December in the Durban Platform for Enhanced Action, an agreement to agree on such limits in the future. Australia, the last developed country aside from the U.S. to ratify the Kyoto Protocol, enacted legislation imposing a carbon tax, while Canada announced its withdrawal from Kyoto. Perhaps the most significant development in Durban’s COP-17 was the insistence for the first time by many poor developing nations that China and India agree to curb their GHG emissions.

(6) The EU hung tough in its efforts to include foreign airlines in the EU-wide cap-and-trade program to limit GHG emissions. In December the European Court of Justice rejected legal challenges against the program brought by non-EU airlines and 26 non-EU governments. This decision could spur new initiatives by non-EU countries to include EU airlines in non-EU cap-and-trade or carbon tax programs.

(7) Transparency initiatives gained momentum including efforts to “green” the supply chains of multinational corporations and to monitor suppliers’ compliance with environmental and labor laws. Ma Jun of China’s Institute of Public and Environmental Affairs played a particularly important role in these developments in China.

(8) Indigenous peoples and the governments of developing countries became more aggressive in seeking to combat environmental harm from projects promoted by developed countries in Asia, South America and Africa. The military government of Myanmar (Burma) stunned the world when it canceled China Power Investments’s construction of the Myistone Dam on the Irrawaddy River. Environmentalists and indigenous people fiercely opposed the project, which was intended to provide China with more electricity. Brazil and China responded to oil spills in their waters caused by offshore drilling by foreign oil companies even more aggressively than the U.S. responded to the BP oil spill.

(9) Many wind and solar energy companies faced hard financial times due to intensifying global competition and pressure to reduce government subsidies. This reinforced the case for policies to tax fossil fuels instead of trying to pick winners to subsidize from among emerging renewable technologies.

(10) In June the U.S. Supreme Court held that use of the federal common law of nuisance to combat climate change had been displaced by the Clean Air Act and EPA’s efforts to use it to regulate GHG emissions. This decision actually gava a boost to EPA’s GHG regulations, which are being challenged in the U.S. Court of Appeals for the D.C. Circuit.

Last week two decisions by federal courts dealt setbacks to important environmental rules. On December 29 a federal district judge in Fresno, California barred enforcement of provisions of California’s statewide program to reduce GHG emissions that require importers of crude oil or ethanol to buy emissions credits. Judge Lawrence J. O’Neill ruled that the regulations discriminate against fuel from other states in violation of the U.S. constitution’s dormant commerce clause. The decision effects at most 9% of the total emission reductions California seeks to achieve. On December 30 the U.S. Court of Appeals for the D.C. Circuit stayed the January 1 effective date of EPA’s Cross-State Air Pollution Rule that would have required 26 states to reduce emissions of sulfur dioxide and nitrogen oxide from powerplants. The court indicated that it would hear legal challenges to the rule, promulgated in July 2011, by April 2012. EPA had estimated that the rule would save between 13,000 and 34,000 lives annually by 2014.

Chinese environmentalists have been stunned by a decision by the country’s State Council to reduce the size of a Yangtze River nature preserve in order to allow the $3.8 billion Xiaonanhai Dam project to be built. The project had been suspended in 2009 after objections from environmentalists. A special panel of 15 certified experts and 15 representatives of government agencies was assembled to review the project, but before they could receive input from environmental groups, they were recorded as unanimously approving the project. The dam is expected to wipe out many rare aquatic species. Michael Wines, China Proceeds on Plan for Disputed Yangtze Dam, N.Y. Times, Dec. 30, 2011, at A8.

China’s steel industry, which accounts for 40% of global steel production, has refused to join the World Steel Association’s global initiative to reduce emissions of GHGs from steel plants, imperiling the project. The decision is not viewed as surprising because the Chinese cement and aluminum industries also have refused to join similar global initiatives, perhaps due to fears of disclosing technical information about their production processes to foreign competitors. Peter Marsh, Financial Times, Dec. 30, 2011, at 2.

Cuba Trip, End of Durban COP-17, EU Airline Cap & Trade Upheld, Incandescent Bulb Phaseout Delayed, EPA Mercury Rule (by Bob Percival)

I am back in D.C. after ten days in Cuba on a people-to-people exchange trip sponsored by the National Geographic Society. As anticipated, very limited internet access there precluded me from posting a blog entry a week ago. The trip was an amazing journey. A 40-minute flight from Miami seemed to transport us back more than 50 years in time to a land with little modern transportation or communication technology and a place where the Cold War still rages. Imagine a country with few cellphones, no private internet access, and where the only advertising is propaganda extolling the virtues of the socialist revolution more than half a century ago.

On our first full day in Havana we met with historic preservationist Miguel Coyula, who discussed the efforts being made to restore Havana’s spectacular colonial architecture. We then spent the day exploring old Havana. The next day we met with a group of Cuban officials, including Elpidio Pérez Suárez, a justice of Cuba’s Supreme Court, at the National Union of Jurists to discuss Cuba’s legal system. We then visited Finca Vigia, Ernest Hemingway’s home, which is located a short distance east of Havana. On our third full day in Cuba we traveled west of Havana to visit the famous Robaino tobacco farm near Pinar Del Rio and we stayed overnight in the picturesque Viñales Valley that features beautiful karst scenery. We later visited the Las Terrazes Bio-Park and a school that incorporates ecological education in all of its classes. We then shifted our base of operations to Cienfuegos from where we visited historic old Trinidad, a World Heritage site, and the Playa Giron where the ill-fated Bay of Pigs invasion took place in April 1961. We then returned to Havana where we met the famous Cuban artist José Fuster and toured the Cementerio Colon, an historic old cemetary. On our last full day in Cuba my wife and I split away from the group to attend a baseball game in Havana between Metropolitana and Granma. We were struck by the quality of play -- close to major league caliber -- as well as the absence of commercialism in the stadium (the only billboard display was a sign announcing in Spanish that “Sport is the right of the people”), and the passion of the fans.

We were blessed with wonderful guides - Christopher Baker (http://www.christopherbaker.com/) who has authored several books about Cuba, including the wonderful “Mi Moto Fidel” about his motorcycle trip around the island, and Neyla Carpio, who works for the Cuban government and passionately disagreed with Baker’s criticisms of the ruling regime. One could not but be struck by the irony of people being transported on ox carts next to billboards extolling the virtues of the socialist system. Due to the U.S. embargo all that we brought back were CDs of Cuban music, but we still were pulled aside by U.S. Customs in Miami for an extra x-ray of our luggage. When I tried to check my Charles Schwab account via the internet from Havana, I received a message stating that access was denied because I was using a computer located in a “dangerous area” of the world. Upon returning to the U.S. I discovered that Schwab had frozen my account because of this (I subsequently was able to get it unfrozen with a phone call explaining the circumstances).

Cuba’s economy collapsed after the fall of the Soviet Union, a time now called the “special period” by the Cuban government. Cuba’s energy infrastructure now relies heavily on discounted oil from Venezuela traded in return for Cuban medical services. Cuba has greatly reduced power blackouts by decentralizing its electrical grid, reportedly in response to some of Amory Lovins’ work. Oliver Houck’s article “Environmental Law in Cuba,” 16 J. Land Use & Envt’l Law 1 (2000) is still the definitive work on environmental law in Cuba. Cuba has some wonderful protected areas, but it undoubtedly will face considerable environmental challenges as its development accelerates in response to greater economic openness. Once the country opens up and U.S. sanctions are lifted, the Cuba that I saw is likely to be radically transformed. The Cuban people express great warmth toward Americans, though not always toward the U.S. or Cuban governments. They seem particularly passionate about Cuban music, the beauty of their country, dogs, baseball, and ice cream. There were so many amazing things to photograph in Cuba that I took more photos than ever. I have edited and labeled the best and posted them online along with some brief video clips at: http://gallery.me.com/rperci#100882. A 16-minute video slideshow of the trip that I prepared is available online at: http://gallery.me.com/rperci#100897.

While I was in Cuba the Durban COP-17 conference went into overtime before concluding with a face-saving “agreement to agree” in the future on binding measures to control emissions of greenhouse gases. Opinion is divided about the significance of this agreement with the commentaries reflecting a kind of “glass half full/glass half empty” quality. To me it seems to represent a further confirmation of the diminishing importance of top-down approaches to international environmental law, in line with my theory about how global environmental law is now developing more from the bottom up. The most shameful performance at the Durban COP was that of the Canadian delegation, which during the conference denied persistent rumors that Canada planned to withdraw from the Kyoto Protocol only to confirm them shortly after the conference ended.

A further illustration of this trend is the European Union’s application of cap and trade regulations to control greenhouse gas emissions to all airlines who fly to and from the EU. On December 21 the European Court of Justice rejected legal challenges to the regulations that had been brought by foreign airlines. Air Transport Association of America and Others v Secretary of State for Energy and Climate Change, Case C-366/10. The Court found that the regulations did not violate principles of customary international law including sovereignty of states over their airspace and freedom to fly over the high seas. The Court also found that the regulations were not precluded by the Chicago Convention on International Civil Aviation and that they did not violate the “Open Skies” Air Transport agreement between the United States and the European Union. The decision was not unexpected and U.S. airlines indicated that they would comply with it while still vowing to persuade the EU to rescind the rules, which will take effect on January 1, 2012. A press release in English from the Court describing the decision is available online at: http://curia.europa.eu/jcms/upload/docs/application/pdf/2011-12/cp110139en.pdf A copy of the Court’s judgment is available at: http://curia.europa.eu/juris/document/document.jsf?text=&docid=117193&pageIndex=0&doclang=EN&mode=req&dir=&occ=first&part=1&cid=162625. Now that the EU can require U.S. airlines to reduce their greenhouse gas emissions on their flights to and from Europe, an appropriate U.S. response would be for us to do the same for flights by EU airlines to and from the U.S. But that may be difficult to do in the absence of a U.S. cap-and-trade system.

While I was in Cuba the U.S. Congress resolved a budget battle by agreeing to appropriations legislation that included a provision to block for nine months (until Sept. 30, 2012) the expenditure of funds to enforce tighter energy efficiency standards that would start to phase out incandescent light bulbs in the U.S. The tighter energy efficiency standards had been adopted by Congress with overwhelming bipartisan support in the 2007 Energy Independence and Security Act. Now it has become an article of faith among some on the right that they represent a severe interference with individual freedom. Canada also has postponed for two years to January 1, 2014, a ban on importation of inefficient incandescent light bulbs, which actually waste the vast majority of their energy by generating heat rather than light. The move to postpone the energy efficiency standards likely will harm U.S. suppliers of more efficient light bulbs who took the regulations seriously while providing temporary windfalls to foreign companies.

Last week the U.S. Environmental Protection Agency (EPA) released long-awaited regulations to require U.S. power plants to reduce their emissions of mercury and other air toxics. EPA estimates that the new regulations will prevent as many as 11,000 premature deaths and 4,700 heart attacks annually while preventing 130,000 cases of childhood asthma symptoms and 6,300 cases of acute bronchitis among children each year. Predictably the regulations were denounced by the editors of the Wall Street Journal, Lisa Jackson’s Power Play, Wall St. J., Dec. 22, 2011, who previously had argued that the regulations could may the lights go out. “If the Lights Go Out,” Wall St. J., Dec. 6, 2011. Their argument was complicated by letters to the editor from the CEOs of two large electric utilities who claim that the utility industry is “well-positioned to comply with these rules” and that the “rules should not be controversial” because “[n]o one disputes that mercury is harmful to human health or that the technology is available now to reduce mercury emissions dramatically.” “Utilities Have Planned for Years for the ‘New’ EPA Rule, Wall St. J., Dec. 10-11, 2011, at A14 (letters to the editor from Jack Fusco, CEO and President of Calpine Corp. and Ralph Izzo, Chairman, CEO and President of PSEG). The Journal editors responded to these letters by denouncing the utility executives as having a vested interest in profiting from higher electricity prices.

Next week I will review the top ten global environmental law developments of the year. Merry Christmas.