House committee releases draft cap-and-trade legislation, challenging state and regional initiatives
On October 7, 2008, John D. Dingell (D-MI), Chairman of the House Committee on Energy and Commerce, and Rick Boucher (D-VA), Chairman of the Subcommittee on Energy and Air Quality, released a discussion draft of legislation establishing a cap-and-trade system designed to cap greenhouse gas emissions. In a memorandum to members of the Committee on Energy and Commerce, Representatives Dingell and Boucher observed:
Since January 2007, the debate over climate change has evolved dramatically, beginning with groundbreaking reports released by the International Panel on Climate Change, which affirmatively settled the question of whether human activity is contributing to global warming. In addition, in the absence of Federal action, some 24 states and several regional organizations have moved towards regulation of greenhouse gases. While the States should be lauded for their progressive stance in addressing the problem, their actions, if not properly coordinated and directed and accompanied by Federal action, could be disruptive to interstate commerce and counterproductive to the goal of limiting national greenhouse gas emissions. (Emphasis added.)
Among other things, the draft legislation proposes limits on state and regional emissions-control programs. For example,
- Section 403(c)(1) would provide the Federal Energy Regulatory Commission with
exclusive jurisdiction over accounts, agreements, and transactions involving a regulated instrument [defined to include emission allowances, offset credits and allowance derivatives], whether inside or outside the United States, that are not subject to the jurisdiction of the Securities and Exchange Commission.
- Section 733(b) would limit the ability of states to implement their own emissions caps:
[N]o State, local, or regional authority may adopt or enforce a program that caps the amount of greenhouse gases that may be emitted or sold, and that uses tradable emission allowances for the purpose of meeting that cap.
- One of two proffered options for Section 816(b) preempts state motor vehicle standards:
(b) [OPTION B] PREEMPTION OF STATE STANDARDS FOR MOTOR VEHICLES.— Notwithstanding sections 177 and 209(b) of this Act, or any other provision of law, no State or any political subdivision thereof shall adopt or attempt to enforce any standard relating to the control of greenhouse gas emissions from new motor vehicles or new motor vehicle engines for which greenhouse gas standards have been established under title II of this Act or for which corporate average fuel efficiency standards have been established under chapter 329 of title 49 of the United States Code. No State shall require certification, inspection, or any other approval relating to the control of greenhouse gas emissions from any new motor vehicle or new motor vehicle engine as condition precedent to the initial retail sale, titling (if any), or registration of such motor vehicle, motor vehicle engine or equipment.
The legislation was not warmly received in all quarters. Fred Krupp, president of the Environmental Defense Fund, cautioned that
[t]he unbending science demands that we reduce global warming pollution far enough — and fast enough — to protect us from the worst consequences of climate change. The near-term targets and timetables in the current draft of the proposal fall far short of that goal.
The potentially preclusive effect of the legislation on existing and prospective state and regional initiatives — among them the Regional Greenhouse Gas Initiative ("RGGI") and the Western Climate Initiative ("WCI") — remains to be seen. Meanwhile, existing initiatives continue to move forward:
- The WCI (a collaboration of seven U.S. states, including California, and four Canadian provinces) released its “Design Recommendations for the WCI Regional Cap-and-Trade Program” on September 23, 2008, followed by the September 30, 2008 release of its "Essential Requirements of Mandatory Reporting for the Western Climate Initiative, Second Draft."
- The week before the House cap-and-trade draft was released, six states participating in the RGGI announced that allowances for the right to emit carbon dioxide from power plants in the northeastern U.S. sold for $3.07 per allowance in the first U.S. greenhouse gas auction. The $38,575,783 in proceeds from the September 25, 2008 auction, operated by World Energy Solutions, Inc., will be distributed to Connecticut, Maine, Maryland, Massachusetts, Rhode Island and Vermont, the six RGGI states that participated in the auction. (The RGGI also includes Delaware, New Jersey, New Hampshire and New York.)
- On October 14, 2008, all ten states of the RGGI initiated the bidding process for the next RGGI allowance auction, set for December 17, 2008.
- The California Air Resources Board ("CARB") released its final draft of a plan designed to reduce emissions to 1990 levels. The “Climate Change Proposed Scoping Plan”, issued on October 15, 2008, includes plans to "develop a cap-and-trade program for California that will link with the programs in the other WCI Partner jurisdictions to create a regional cap-and-trade program."
The release of the draft House bill highlights a looming legislative (and probably judicial) jurisdictional battle over cap-and-trade and other emissions-control programs.
British jury in Kingsnorth case finds in favor of climate change protestors
By a majority verdict, a British jury found five protestors who shut down the Kingsnorth coal-fired power plant had a “lawful excuse” to close the plant to prevent greater damage from global warming. Greenpeace activists, protesting the contribution of coal-electric power plants to climate change, scaled a chimney and painted the word “Gordon” on the chimney before they were forced down (“Gordon” is a reference to British prime minister Gordon Brown). The protest shut down the power plant temporarily and the graffiti cost about $62,000 to remove. The jury verdict in favor of the protestors illustrates how a U.S. jury might respond to similar protests.
The jury verdict in favor of the protestors illustrates how a U.S. jury might respond to similar protests. According to a recent Pew Research global warming survey, 73% of respondents said that global warming was a serious problem. Forty-seven percent said that human activity was the cause of warming. If a case like the one in Britain came to trial before a U.S. jury, about half of the seated jurors are likely to enter the trial with attitudes and opinions favorable to defendants.
With Congress in gridlock and given the increasing partisan divide on the reality of global warming and its causes, climate issues are unlikely to be resolved by the political process, at least in the near term. Instead, climate issues are likely to come, piecemeal, to the courts for resolution on case-by-case basis. Juries (and judges) are ill-equipped to decide these issues and not just because the issues are complex and difficult. Juries and judges typically decide questions of past fact where the evidence is assembled and brought to the trier of fact for evaluation and judgment. But climate change issues involve questions of future fact: “Is the damage to shutting down a power plant greater or lesser than the damage to done to the climate from continued operation of that plant?” These are policy questions, not questions of fact, on which we make judgments before all the evidence is in. On climate issues, the evidence is still being collected and the policy decisions we reach are inevitably affected by our values. To ask a jury to decide these issues while the evidence is still being collected is like asking jurors to decide a murder case while the police are still investigating. Faced with incomplete facts and competing expert opinions, jurors (and judges) have little choice but to interpret the evidence in light of their life experience. As we saw with the British jury, jurors will decide the controversy in light of their own opinions and values. The Kingsnorth case also highlights the thorny issue of how climate science will be dealt with in front of juries. Climate scientist Jim Hansen was permitted to testify that “the 20,000 tonnes of carbon dioxide emitted daily by Kingsnorth could be responsible for the extinction of up to 400 species.” But this kind of specific causation opinion – linking emissions from a single plant to extinction of 400 species – is controversial at best and would face a significant reliability hurdle in U.S. courts.Federal failure to regulate greenhouse gas emissions alleged by new climate lawsuit
On July 31st, Western Environmental Law Center attorney Dan Galpern is expected to announce what a press release describes as "a new lawsuit targeting the Bush administration's unlawful refusal to regulate certain major sources of global warming pollution." The announcement will occur during the eight-day Oregon Climate Convergence.
Galpern currently represents 10 environmental groups in litigation challenging US EPA's decision to deny California's request that the federal government waive preemption and allow state regulation of greenhouse gas emissions from cars and light-duty trucks. Galpern foreshadowed this and other future lawsuits in a May 8, 2008 article in the Journal of Environmental Law and Litigation entitled Climate Change 101: Urgency and Response. There, he wrote:
States and environmental litigants are likely in 2008 and beyond to bring to the courts the ever-mounting evidence that federal inaction increasingly runs the risk of irreversible damage to natural and human systems.
Stay tuned.
Civil conspiracy claim targets political question defense in public nuisance climate suit
While three nuisance-based climate lawsuits have been dismissed by federal district courts because, among other reasons, they raised non-justiciable political questions, plaintiffs in the latest public nuisance case believe that the addition of a civil conspiracy claim will overcome the political question defense.
In a recent radio interview, Steve Susman was asked about the Kivalina litigation, in which he represents plaintiffs alleging that the Alaskan village of Kivalina is sinking as a result of climate change allegedly caused by defendant oil, power and coal companies. The Susman interview supports the conclusion that the conspiracy allegation -- that defendants conspired to mislead the public on the causes and effects of global warming -- was intended to overcome a political question defense: “we are the only case that has a conspiracy allegation, and we think that makes our case different, because courts all the time—there are criminal trials going on throughout this country every week about whether someone participated in a criminal conspiracy. So that's the stuff of which courts are made, to decide whether there was a conspiracy, and did it harm someone.”
Likewise, Matt Pawa, whose firm filed the first climate-based public nuisance claim against power plants, noted that Kivalina “includes a claim that certain defendants conspired to mislead the public about global warming. There were no such conspiracy claims in the other cases. Courts routinely decide such conspiracy claims.”
But the inclusion of a civil conspiracy claim may not be a silver bullet against a political question defense. If the public nuisance claims are non-justiciable (as three district court’s have concluded, all now on appeal), there is a real question of whether the court can decide a stand-alone conspiracy claim. For example, in the public nuisance cases brought by the state of Rhode Island against former manufacturers of lead pigment, the district court dismissed the civil conspiracy claim finding that it “cannot stand in isolation” without an “underlying intentional tort theory.” Rhode Island v. Lead Industries Association, Inc.
