Ceres reports that insurers want to be part of the climate change solution
In April 2009, Ceres published a report entitled “From Risk to Opportunity, Insurer Responses to Climate Change.” The report contains responses and significant information from over 12 insurance companies, as well as several brokers, insurance consultants, insurance associations regarding the climate initiatives being undertaken by the industry, including coverage for green buildings, renewable energy, carbon risk management, and officers’ liability insurance to tackle climate change and rising weather-related losses in the US. The report speaks to the many insurer activities identified in our previous blog post regarding insurance industry climate change strategy and its implications for corporate policy holders, as well as the more recent March 17, 2009 National Association of Insurance Commissioners (NAIC) climate risk disclosure requirement for insurance companies. The insurance industry’s response aims to address more than $200 billion in estimated losses to the global economy attributed to climate change, but critics say the industry’s response is too little, too late.
Continue Reading...EPA seeks remand of Desert Rock coal fired power plant permit to consider gasification technology as BACT
Despite granting a permit for the proposed Desert Rock coal fired power plant in New Mexico less than a year ago, the US Environmental Protection Agency (“EPA”) recently moved its Environmental Appeals Board (“EAB”) to remand the permit to allow the EPA to reevaluate its decision. In particular, the EPA wants to consider requiring the plant, which would be built by Desert Rock Energy Co., to use low-carbon dioxide gasification technology. The technology gasifies coal before it is burned, resulting in lower carbon dioxide emissions than conventional coal burning technology.
Continue Reading...Green Patents: setting royalties for clean technology
Co-authored with Cyrus Frelinghuysen.
On April 17th, Judge David J. Folsom of the US District Court for the Eastern District of Texas issued an order in Paice LLC v. Toyota Motor Corp., increasing the royalty rate that the Toyota Motor Company must pay Paice LLC for sales of Prius, Highlander, and the Lexus RX400h vehicles found to infringe a Paice patent involving hybrid vehicle technology. Judge Folsom had previously ordered Toyota to pay $25 per infringing vehicle but on remand raised the rate to roughly $98 per vehicle.
The decision stems from a series of lawsuits Paice brought against Toyota alleging infringement of its patents related to hybrid electric vehicles. Paice filed its complaint in this particular case in June 2004. A jury later found that Toyota had infringed two claims of US Patent No. 5,343,970 for drive trains for hybrid electric vehicles. Paice was awarded $4,269,950 for past infringement, but Judge Folsom denied Paice’s request for injunctive relief in light of the Supreme Court’s decision in eBay, Inc. v. MercExchange, LLC, 547 U.S. 388 (2006). Instead, Judge Folsom ordered Toyota to pay Paice an “ongoing royalty” of $25 per infringing vehicle until the expiration of the patent.
Continue Reading...California passes Schwarzenegger's Low Carbon Fuel Standard
On Thursday California Air Resources Board (“CARB”) adopted a regulation implementing Governor Schwarzenegger's Low Carbon Fuel Standard (“LCFS”) making it the first state in the nation to mandate carbon-based reductions in transportation fuels. This “new low-carb” standard hopes to officially slash from California’s diet the greenhouse gas emissions blamed for climate change. Specifically, the new standard is expected to significantly reduce the state’s carbon emissions waistline by trimming California transportation fuels by 10% and replacing 20% of the petroleum fuels burned by California cars by the year 2020. The new low-carbon standard was recently proposed as part of the implementation of the California Global Warming Solutions Act (AB 32).
Continue Reading...California OPR issues proposed amendments to CEQA guidelines regarding greenhouse gases
On April 13, 2009, the Governor’s Office of Planning and Research (“OPR”) submitted to the Secretary for Natural Resources its proposed amendments to the California Environmental Quality Act (“CEQA”) Guidelines for greenhouse gas emissions, as required by Senate Bill 97. These proposed CEQA Guideline amendments are intended to provide public agencies guidance when analyzing and mitigating the effects of greenhouse gas emissions in draft CEQA documents. The California Natural Resources Agency will conduct formal rulemaking in 2009, prior to certifying and adopting the amendments, but must certify and adopt the guidelines on or before January 1, 2010.
Continue Reading...California Clean Truck Programs not enjoined by court despite anticompetitive concerns raised by Federal Maritime Commission
On April 15, 2009, the United States District Court for the District of Columbia denied a motion for a preliminary injunction filed by the Federal Maritime Commission to stop certain aspects of the Clean Truck Programs instituted by the Port of Los Angeles (“POLA”) and Port of Long Beach (“POLB”). The POLA and POLB Clean Truck Programs (“CTPs”) are environmental programs aimed at reducing air pollution caused by trucks used for “drayage” or shipping of cargo to and from the Ports. The Ports designed their CTPs in response to December 2007 rules promulgated by the California Air Resources Board (“CARB”) to reduce emissions from diesel trucks at California’s ports. POLA and POLB are neighboring, and competing, ports in Los Angeles County's San Pedro Bay which together form the largest port area in the United States. Approximately 40 percent of the United States’ import and export container traffic flows through the Ports, making them critical components of the nation’s economy. The Ports’ CTPs, while not identical, share similar features, including a rolling ban on older trucks, a Clean Truck Fee of $35 on containers leaving each port, and a concession agreement into which Licensed Motor Carriers must enter to transport cargo to or from the Ports.
Continue Reading...Obama administration ups the ante for climate change legislation by proposing regulation of greenhouse gases under the Clean Air Act
The US Environmental Protection Agency (EPA) made a game-changing move last Friday in the policy debate over climate change. EPA declared in a proposed rule released on April 17 that greenhouse gases endanger human health and welfare and that greenhouse gas emissions from new motor vehicles and new motor vehicle engines contribute to climate change. The proposal is the Obama Administration’s response to the 2007 US Supreme Court decision in Massachusetts v. EPA, wherein the Court held that greenhouse gases are “air pollutants” under the Clean Air Act and remanded the matter to EPA to set forth a reasoned explanation for its decision as to whether to regulate greenhouse gasses.
In its rulemaking proposal, EPA answered the Supreme Court ruling by providing the Administration’s rationale for regulating greenhouse gases: that climate change is the “unambiguous result of human [greenhouse gas] emissions” and that the “observed” adverse effects of climate change include degraded air quality, greater sea level rise, increased drought, and harm agriculture, wildlife and ecosystems. If the proposal becomes a final rule, EPA would define “air pollution” to include “the mix of six key directly emitted and long lived greenhouse gases: carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydroflurocarbons (HFCs), perflurocarbons (PFCs), and sulfur hexafluoride (SF6).”
By taking the administrative route to regulate greenhouse gases through the existing Clean Air Act, the Administration is gambling in high stakes poker. Similar endangerment language to Section 202 (a) is present in many other sections of the Clean Air Act including Section 108 (NAAQS), Section 111 (NSPS), Section112 (NESHAP), Section 213 (Non-road vehicle emissions) and Section 231 (Aircraft emissions). The proposed endangerment finding could well lead to a cascade of unintended regulation that includes a presumption of an endangerment finding under multiple provisions of the Clean Air Act, a corresponding duty to regulate new and existing stationary sources, and a duty to permit greenhouse emissions from as many as a million or more new sources including numerous construction projects selected to be built pursuant to the Stimulus Package. This would create what Rep. John Dingell (D-Mich.), a 30 year veteran of Clean Air Act legislation, has called "a glorious mess."
Continue Reading...United Nations Human Rights Council resolves to conduct panel on human rights and climate change
At the tenth session of the UN Human Rights Council, from March 11-27, the Council passed Resolution L30, which calls upon the Council to hold a panel discussion on the relationship between human rights and climate change at the eleventh session. The Maldives, an island nation southwest of India, proposed Resolution L30. The Maldives has been emerging as a proponent of environmental protection, as evidenced by a July 2007 speech of its President, Abdul Gayoom. The country recently announced a dedication to be carbon neutral by the year 2020. Since 2007, the Maldives has been urging the United Nations to globally address the issue of climate change.
Continue Reading...Professor advocates new nuclear waste policy
On March 27, 2009, Professor Richard Stewart of NYU presented his recent paper, entitled “US Nuclear Waste Law and Policy: Fixing a Bankrupt System” at the US Capitol Visitor Center. Steve Kraft, Senior Director of used fuel management at the Nuclear Energy Institute (NEI), Tom Cochran, the director of the nuclear program of the Natural Resources Defense Council (NRDC), and Charles Powers (moderator), a professor at Vanderbilt University also provided comments on this paper. Stewart’s paper advocates a major shift in the way the US has thought about nuclear waste policy since the 1970s. He provides five steps towards creating a more effective nuclear policy: 1) rethinking the ethics of nuclear waste; 2) creating a Nuclear Waste Policy Commission; 3) creating new waste management and siting agencies and eliminating regulatory duplication; 4) a risk-based approach to categorizing nuclear waste (as opposed to process-based approach); and 5) a flexible and adaptive waste management strategy. The fundamental tenants of his plan are garnering public support and acceptance and using nuclear waste reprocessing as an alternative to disposal.
Continue Reading...RAT Board to monitor spending of stimulus plan dollars for fraud, waste and abuse
The stimulus package, also known as the American Recovery and Reinvestment Act, signed into law on February 17, 2009, includes a number of initiatives aimed at addressing climate change, including investment in renewable energy. However, companies receiving monies from the stimulus package for clean tech, renewable energy, and other climate-related projects will be subjected to heightened scrutiny, transparency in spending and accountability. Along with the billions of dollars allocated to energy and the environment, the Act created the “Recovery Accountability and Transparency Board,” commonly referred to as the “RAT” Board, which has been given the authority to root-out fraud, waste and abuse in the expenditure of stimulus dollars. Indeed, of the $787 billion to be plowed into the economy, $350 million was allocated to the RAT Board and the offices of Inspector General for many of the major federal agencies.
Continue Reading...Major Economies Forum on Energy and Climate to address emissions targets, clean energy tech, more
President Obama has announced the launch of the Major Economies Forum on Energy and Climate. A preparatory session will be held at the Department of State in Washington, DC on April 27-28 and further talks will take place in La Maddalena, Italy in July. The goal of these meetings is to lay the diplomatic foundation for a successful outcome at the UN climate change negotiations to be held in Copenhagen, Denmark in December.
Continue Reading...FTC updating Green Guides, which govern environmental building claims
Original post available at www.constructionweblinks.com.
The Federal Trade Commission’s Green Guides, which govern environmental marketing claims, will be updated this year. The Green Guides are the FTC’s primary tool for preventing consumer deception in the ever-expanding arena of environmental claims. The manual was last updated in 1998. This year’s version will clarify the legal parameters for environmental promises made to consumers and business clients.
The Green Guides are intended to prevent “greenwashing” – claims of environmental superiority or benefit that are untruthful or misleading. Companies may engage in greenwashing in an effort to sell more products or to bolster their reputation with consumers.
Waxman-Markey climate change and energy bill faces significant political hurdles
On March 31, 2009, House Energy and Commerce Committee Chair Henry Waxman (D-MA) and Energy and Environment Subcommittee Chair Ed Markey (D-MA) unveiled the American Clean Energy and Security Act of 2009 (ACES). Although the legislation sketches a skeletal framework for carbon regulation, it is conspicuously silent on several key issues. Most importantly, the bill does not discuss what percentage of allowances, if any, will be auctioned or provided free of charge; nor does it specify whether, to what extent, and in what form, the billions in revenue generated by allowances will be returned to US taxpayers. These critical questions have been tabled for committee deliberation.
Reps. Waxman and Markey have fast-tracked ACES to be out of committee by Memorial Day. This schedule is consistent with the administration’s larger objective of signing a comprehensive climate and energy bill into law in advance of the December 2009 UN Climate Change Conference in Copenhagen. With key questions yet to be addressed and stark policy differences between supporters and detractors of the draft bill, some are skeptical whether the US can agree on comprehensive climate legislation before the Copenhagen summit.
Continue Reading...New York's participation in RGGI to be reconsidered
New York Governor David Paterson plans to reconsider the rules that enable New York’s participation in the Regional Greenhouse Gas Initiative (RGGI), according to a recent report in the New York Times. Power plants have long contended that the RGGI system of auctioning emission allowances puts companies who are locked into long term contracts at a serious disadvantage. Such generators, argue representative groups such as the Independent Power Producers of New York (IPPNY), cannot recoup the extra costs associated with purchasing allowances. Similar concerns prompted Indeck Energy in January to file a lawsuit challenging New York’s authority to implement RGGI, and alleging that the regulations would essentially impose an unauthorized tax.
Continue Reading...California proposes regulations implementing Low Carbon Fuel Standard for transportation fuels
At its upcoming April 23-24 hearings, the California Air Resources Board (CARB) will consider adoption of recently proposed regulations for implementing a Low Carbon Fuel Standard pursuant to an Executive Order signed by Gov. Arnold Schwarzenegger in 2007. The proposed regulations, part of the implementation of the California Global Warming Solutions Act (AB 32) would require a 10 percent reduction in transportation fuel emissions by 2020, which would be accomplished by requiring regulated parties to incrementally reduce the carbon intensity of fuels sold in California. CARB predicts this will require 20 percent of fuel currently used statewide to be replaced with alternative energy sources (e.g. biofuels, electricity, and hydrogen). CARB Chairwoman Mary Nichols described the proposed rule as a “comprehensive, cradle-to-grave approach” for spurring competition and innovation in the alternative energy market.
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