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Judd Law - Meteorology of Env'ntal Impact Review of GHGs

Judd Law - Meteorology of Env'ntal Impact Review of GHGs

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Published by Jeffrey M. Judd
In this article, Mr. Judd discusses state and federal governmental efforts to require greenhouse gas emissions impacts to be included in environmental impact statements.
In this article, Mr. Judd discusses state and federal governmental efforts to require greenhouse gas emissions impacts to be included in environmental impact statements.

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Published by: Jeffrey M. Judd on Apr 25, 2010
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The Meteorology Of Environmental Impact Review - Law360

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The Meteorology Of Environmental Impact Review

Law360, New York (September 18, 2009) -- Awareness of global climate change issues has become deeply entrenched in the public consciousness. Indeed, it seems that hardly a day passes without a mainstream media report on greenhouse gas emissions, carbon footprints, rising sea levels or polar ice loss.

With so much of the public's attention directed toward global climate, one might expect rigorous procedures to be in place that require governmental decision-makers to consider these issues in project environmental reviews.

In fact, recent developments in science, law and politics have, at present, made this area of the law as volatile as the weather. This article reviews recent case law and discusses some administrative and legislative trends that are stabilizing conditions somewhat in some jurisdictions. The long-term forecast, however, calls for unsettled conditions to remain in most of the country.

Since 1970, the National Environmental Policy Act, 42 U.S.C. § 4321 et seq. (NEPA), has required responsible federal agencies to complete a full environmental impact statement (EIS) whenever a "major Federal action" may cause a significant adverse environmental impact.

NEPA thus ensures that government decision-makers - and the public - are informed about reasonable alternatives that would avoid or minimize adverse impacts or enhance the quality of the human environment.

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Federal actions that fall within NEPA's jurisdiction include projects and programs that are financed, assisted, conducted, regulated or approved by federal agencies; agency rules, regulations, plans, policies or procedures; and legislative proposals.

NEPA requires analysis of the reasonably foreseeable effects the proposed federal action will

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cause - whether such impacts are direct, indirect or cumulative. Over 15 states have adopted "mini-NEPA" statutes, most of them patterned closely after the federal act.

At every stage of the" environmental review process the lead agency has discretion to make environmental policy judgments.

Because NEPA is a procedural statute, a reviewing court cannot substitute its judgment for the agency's; the EIS must, however, include a record demonstrating that the agency's analysis and conclusions are well-reasoned and based on available scientific information and other available evidence.

An agency cannot avoid analyzing the adverse impacts a project will cause, even if essential information is incomplete or unavailable: In such cases, NEPA requires the agency to obtain all essential information, unless the cost of obtaining it is exorbitant. Even then, the EIS must identify the Information that is unavailable and include a finding that it is not reasonably obtainable.

For well over a decade environmental activists have sponsored litigation challenging the adequacy of environmental impact statements under NEPA and state "mini-NEPA" statutes for failure to analyze project-generated impacts on global climate change.

They have argued that a sufficient body of scientific work has for years supported the conclusion that greenhouse gas emissions cause cumulative, significant adverse climate impacts. They further argue that any lack of essential information does not negate NEPA's mandate to undertake an environmental assessment.

Recent judicial decisions illustrate the variety of responses different jurisdictions have to these arguments.

Center for Biological Diversity v. National Highway Traffic Safety Administration, 538 F.3d 1172 (9th Cir. 2008), for example, holds that projects that cause even a slight increase in greenhouse gas must be analyzed for impact significance.

In reaching this conclusion. the Ninth Circuit relied on recent scientific papers positing that any incremental emission of greenhouse gases, regardless how slight, could cross a - presently unknown - threshold and cause a sudden, accelerated, irreversible change in the world's climate as evidence of indirect, cumulative significance. See 538 F.3d at 1221-22.

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On the other hand, in Mayo Foundation v. Surface Transportation Board, 472 F.3d 545 (8th Cir. 2006), the Eighth Circuit refused to require the agency to analyze how the facilitated extraction of coal might affect climate, accepting the agency's assertion that easier access to coal would, at most, cause "small" climate impacts on a national and regional basis. See 472 F.3d 555-56.

In the absence of regulatory or statutory requirements for agencies to perform environmental review of project-generated greenhouse gas emissions, practitioners will continue to face different requirements, depending on the jurisdiction in which a project is located.

On Feb. 28, 2008, however, the International Center for Technology Assessment, the Natural Resources Defense Council and the Sierra Club petitioned the U.S. Council on Environmental Quality (CEQ) to amend the regulations that govern NEPA review to "clarify that climate change analyses be included in environmental review documents."

The petition sets forth the scientific, policy and legal arguments that environmental activists regularly make in challenging project EISs. The CEQ has not yet acted on the petition, and to date there has been no official statement indicating when, or how, the CEQ will respond.

Some predict the current administration's CEQ will promulgate regulations that require all federal agencies to include greenhouse gas emissions analysis in environmental impact statements.

As support for this prediction, they point to the recent settlement of a lawsuit brought by a coalition of environmental groups against the Export-Import Bank (Ex-Irn Bank) and the Overseas Private Investment Corporation (OPIC).

Ex-Irn Bank and OPIC are federal corporations that provide assistance, including financing, to support U.S. exports and business operations abroad.

In 2002, the environmental groups filed a complaint alleging that, because Ex-1m Bank or OPIC decisions involving energy projects abroad could affect global climate, NEPA required them to analyze greenhouse gas impacts before approving any project under consideration.

After years of hard-fought litigation, in February 2009 the parties submitted a written stipulation to settle the case. The settlement includes the Ex-Irn Bank's and OPIC's respective agreements to follow specific procedures for greenhouse gas impacts review

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under NEPA, among other things.

See Friends of the Earth v. Spinelli (Civ. No. 02-4106, N.D. Cal.) at www.foe.org/pdf/ExIm_Settlement.pdf (Ex-Im Bank settlement agreement), www.foe.org/pdf/OPIC_Settlement.pdf (OPIC settlement agreement).

Guidance for project review under CEQA is provided in the CEQA Guidelines, 14 California Code of Regulations Sections 15000-15387.

Whether the Ex-1m Bank/OPIC settlement signals that the CEQ is ready to promulgate regulations that expressly require environmental review of project-generated greenhouse gas emissions remains to be seen.

At the state level, however, California is in the final stages of promulgating regulations that specifically address the analysis of project-related greenhouse gas emissions under the California Environmental Quality Act, Cal. Pub. Res. Code § 21000, et seq. (CEQA).

CEQA is California's version of a "mini-NEPAli statute. Although CEQA closely follows NEPA in most respects, in at least one way it differs substantially: CEQA requires all identified significant adverse environmental impacts to be mitigated or reduced to a level of no significance.

The California Natural Resources Agency commenced the rulemaking process for CEQA greenhouse gas analysis guidelines on July 3; the public comment period has closed, and new guidelines are expected to be enacted by Jan. 1, 2010.

The new California guidelines take the approach that greenhouse gas analysis does not require a wholesale change to CEQA, and the majority of changes simply make express the mandate to analyze greenhouse emissions in environmental impact reports (the California version on an EIS).

The guidelines include two entirely new sections: One discusses how a lead agency should assess whether greenhouse gas emissions cause significant impacts, and the other new section addresses two methods - "tiering and streamlining" - to simplify the greenhouse gas impacts analysis.

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The most difficult task lead agencies will face, at least initially, is to determine whether project-generated greenhouse gas emissions will cause "significant" adverse impacts.

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A lead agency is thus essentially free to select a project-appropriate method to determine the significance of project-generated greenhouse gases, so long as it adequately explains its reasoning, based on substantial evidence.

This analysis is complicated by the absence of established regulatory standards, the relatively small amount of greenhouse gas emissions that any single project is likely to generate, the cumulative nature of climate change, and the rapidly developing study of climate sciences.

The California greenhouse gas guidelines direct lead agencies to consider the extent to which a project may increase or reduce greenhouse gas emissions as compared with existing conditions; any thresholds of significance the lead agency deems appropriate for the project; and the extent to which the project complies with existing statewide, regional or local plans to reduce or mitigate greenhouse gases.

Until generally accepted standards are developed, some California courts may require environmental impact reports to examine a wide array of guidance and policy documents and provide a reasoned, evidence-based explanation as to why the lead agency has deemed certain greenhouse gas policy documents to be most relevant to the study project and how the project relates to such policies.

The new provision for tiering and streamlining, Section 15183.5 of the guidelines, outlines several methods to simplify analysis of the impact of project-generated greenhouse gas emissions.

To the extent a programmatic approach to greenhouse gas emissions has been adopted following CEQA review - such as in a general plan, a long-range development plan or a separate plan to reduce greenhouse gas emissions - project-specific review may rely on such plan's underlying environmental report.

Environmental impact report proponents should be aware of general plans, development plans, specific greenhouse gas reduction plans, and other programs that have jurisdiction over the project, and be prepared to include in the record a discussion of such plans.

Greenhouse gas policy documents that have not been reviewed under CEQA may be used in the cumulative impacts analysis, but simply referring to such a plan and asserting that the project complies will not by itself suffice.

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A recent case illustrates how a trial court may apply the new CEQA greenhouse gas guidelines.

At a minimum, an environmental impact report must provide a reasoned, evidence-based analysis that explains why the lead agency finds a non-CEQA greenhouse gas-reduction plan to pertain to the project under review.

In response to project opponent critiques submitted during the public review process, WalMart's final environmental impact report asserted that the project's climate impacts were not significant because the project complied with the governor's greenhouse gas strategies, a high-level strategy document to guide statewide efforts to reduce greenhouse gas emissions over the next dozen years.

In May 2009, Wal-Mart's plans to build a "Supercenter" near Joshua Tree National Forest were put on hold when a California Superior Court ruled that the environmental impact report inadequately assessed the effect of project-generated greenhouse gases.

The governor's strategy document was adopted without CEQA review. The court found WalMart's analysis inadequate because it was not supported by substantial evidence.

A proffer of evidence demonstrating compliance with the governor's strategies could remedy this defect and possibly be found to adequately address CEQA's greenhouse gas emissions analysis requirement.

The court also held, however, that Wal-Mart's environmental impact review must comply with the draft greenhouse gas emissions guidelines, which could be found to require a more fulsome analysis.

Recent cases and policies developed in a variety of states, including New York and California, indicate that projects in which energy use or greenhouse gas emissions are deemed to cause significant adverse environmental impacts need to consider various emissions sources and possible mitigation measures.

Direct greenhouse gas emissions sources, like combustion, industrial processes and the use of fleet vehicles at the project site should be analyzed.

Indirect sources, like purchased power consumed by the project that is generated off-Site, and project-induced non-fleet vehicle trips should also be considered.



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In at least one case, even "induced traffic" - the phenomenon by which increasing road capacity also increases the number of drivers using the roadway, was also found to require analysis in that project's EIS.

See North Carolina Alliance for Transp. Reform Inc. v. U.S. Dept. of Transportation, 151 F.Supp.2d 661, 690 (M.D.N.C. 2001).

Increaslnqlv, potential construction impacts - that is, the energy used in the fabrication of construction materials and the transport of materials to and from the site, among other things - require discussion in EISs.

See, e.g., New York State Department of Environmental Conservation Policy, Guide for Assessing Energy Use and Greenhouse Gas Emissions in an Environmental Impact Statement (sssued July 15, 2009).

During this time of rapidly evolving developments in climate change policy, science and public concern, project proponents are well-advised to consider project-generated greenhouse gas emissions early in the development cycle.

While this area of the law remains uncertain, project sponsors can be sure that environmental review of greenhouse gas impacts will continue to be a favorite target of project opponents.

Because being targeted for environmental activism can adversely affect a project's budget, timing and public perception, project stakeholders should consider the point at which the cost of defending against serial environmental challenges exceeds the cost of implementing strategies to reduce greenhouse gas emissions.

Familiarity with local and regional greenhouse gas reduction programs and policies will become lncreaslnqlv important as a means to identify and economically address projectcaused impacts.

Until specific approaches to greenhouse gas emissions analysis become generally accepted, a significant level of uncertainty will continue to exist.

Addressing greenhouse gas issues early will help guide client expectations, maximize the opportunities to reduce delay, incorporate design flexibility and avoid unnecessary transaction costs.



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--By Jeffrey M. Judd, Howrey LLP

Jeffrey Judd is a partner with Howrey in the firm's San Francisco office and a member of the firm's environmental, product and tort law group.

The opinions expressed are those of the author and do not necessarily reflect the views of Portfolio Media, publisher of Law360.

All Content © 2003-2009, Portfolio Media, Inc.

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