VNF Issue Alerts

Weekly Climate Change Update - May 5, 2008

Over the last week, the biggest emerging question is what will be in the Manager's Amendment, an overhaul of the Lieberman-Warner bill designed to attract more votes. Meanwhile, the Energy Information Administration released its analysis of the Lieberman-Warner bill, showing allowance prices doubling from $30/ton to $60/ton between 2020 and 2030. Also, some Senate Republicans may endorse an alternative approach proposed by Senator Voinovich that focuses on tax incentives and other subsidies for clean energy technologies.

Weekly Climate Change Policy Update - April 28, 2008

Noteworthy in Climate Change news this week was the "Manager's Amendment" drawn up by the staff for Senators Boxer, Lieberman, and Warner. In addition, Senator Voinovich (R-OH) is working on a bill focusing on technology incentives. Also, some Senators are considering ways to expand the Lieberman-Warner bill to target deforestation.

Weekly Climate Change Policy Update - April 21, 2008

President Bush's Rose Garden speech on climate change policy was the topic of conversation in this week's climate change news, although it brought about less of an impact than anticipated. In addition, the Governors of 18 states signed a declaration requesting a federal-state partnership to address climate change. Also in the news were the two front-page articles in the Wall Street Journal on problems with the Kyoto Protocol's Clean Development Mechanism.

Weekly Climate Change Policy Upate - April 14, 2008

It is expected that the Lieberman-Warner bill will be brought to the Senate floor on June 2nd, which will likely include a manager's amendment to the bill. Also in the news is the "cost containment" compromise that could be in the works with the help of the National Commission on Energy Policy, the Nicholas Institute, and the US Climate Action Partnership.

Weekly Climate Change Policy Update - April 7, 2008

The climate change news this week includes the request of 12 states that the D.C. Circuit Court of Appeals force EPA to take action on GHG emissions, the reports issued by three subcommittees of the Western Climate Initiative, and Former Vice-President Al Gore's new media campaign to build support of US effort to regulate GHG emissions.

PHMSA Issues Interim Final Rule Establishing Procedures for Safety Orders and Special Permits

The Department of Transportation’s Pipeline and Hazardous Materials Safety Administration issued an interim final rule that establishes procedures for issuing Safety Orders and handling requests for emergency and non-emergency Special Permits.

Weekly Climate Change Policy Update - March 31, 2008

The pace of activity on the Hill last week was slow due to Congress' recess and the Easter holiday. However, EPA announced it will issue an Advanced Notice of Proposed Rulemaking in the spring in response to the Supreme Court's finding in Massachusetts v. EPA. This development has implications in the speed at which the rulemaking process is moving.

FERC Proposes to Revise Approach to Standards of Conduct for Transmission Providers

The Federal Energy Regulatory Commission issued a notice of proposed rulemaking that would modify the standards of conduct applicable to interstate natural gas pipelines and electric utilities.

Weekly Climate Change Policy Update - March 24, 2008

This week's climate change news included the readiness of Senators Cantwell and Ensign to make another attempt at renewing renewable energy tax credits. Also in the news was the belief held by Democrats on the House Oversight and Government Reform Committee that the EPA is delaying findings for GHG emissions. Lastly, RGGI is ready to hold its first auctions, and the EU is warning US airlines of limitations on landing rights that would be imposed on them should they refuse to join the EU Emissions Trading Scheme.

PHMSA Proposes Regulations to Permit Certain Gas Transmission

On March 12, the Department of Transportation’s Pipeline and Hazardous Materials Safety Administration issued a notice of proposed rulemaking that would amend existing federal pipeline safety regulations to enable operators of gas transmission pipelines to obtain approval to calculate higher maximum allowable operating pressures for certain lines by using higher design factors.

Weekly Climate Change Policy Update - March 17, 2008

Developments with the Lieberman-Warner bill dominated the news this week. The EPA came out with its analysis of the bill, and a study by the National Association of Manufacturers and the American Council for Capital Formation predicts adverse impacts arising from the bill, such as doubled gas prices by 2030. In addition, the Coalition for Emission Reduction Projects (CERP) released a letter to the Senate offices advocating that regulated entities be able to use offsets for compliance in any cap-and-trade program.

EPA Lowers the 8-Hour Ozone Standard to 0.075 ppm

On March 12, 2008, the Environmental Protection Agency (EPA) announced its decision to revise the 8-hour ozone National Ambient Air Quality Standard (NAAQS) to 0.075 parts per million (ppm).

Weekly Climate Change Policy Update - March 10, 2008

Very noteworthy this week was the tremendous caliber of the Washington International Renewable Energy Conference (WIREC) that was held in Washington, D.C. In addition, Energy and Commerce Committee Chairman John Dingell (D-MI) stated that he will release a draft bill by mid-April, and he also held a hearing discussing international competition in U.S. climate change legislation.

PHMSA Issues Advisory Bulletin Regarding Mechanical Couplings Used in Natural Gas Distribution Systems

On March 4, the Department of Transportation’s Pipeline and Hazardous Material Safety Administration (PHMSA) issued an Advisory Bulletin urging operators of natural gas distribution systems to review their procedures for using mechanical couplings and ensure that design and installation procedures for couplings, leak survey procedures, and personnel qualifications meet federal pipeline safety requirements.

Weekly Climate Change Policy Update - March 3, 2008

This week Florida considered linking its climate change program to those of other states and regions in the US. In addition, PG&E bought forestry offsets in anticipation of California's regulatory program. Also, the House of Representatives Energy and Commerce Committee issued a new "white paper" on climate policy discussing questions on the distribution of various efforts once the plan comes into place.

Weekly Climate Change Policy Update - February 25, 2008

In the coming weeks, keep an eye out for analyses from the Environmental Protection Agency and the Energy Information Administration on the impacts associated with the Lieberman-Warner bill. Also in the news are the efforts of various states to move towards emissions programs as well as the Bush Administration's newfound consideration of global carbon markets.

Weekly Climate Change Policy Update - February 19, 2008

There were a variety of developments in this week's climate change news including the consensus that was reached during the hearing in the Senate Finance Committee on the notion of trade sanctions on imports from countries that do not have an absolute emissions cap. Also in the news were the CA Public Utilities Commission's recommendations for California's emissions trading program, the Congressional Budget Office's strong support of carbon tax as the best climate policy, and statements issued by banks and other financial institutions regarding investment in clean energy and energy efficiency.

FERC Poised to Review NERC Registration of Generator as Transmission Owner and Transmission Operator

On February 4, New Harquahala Generating Co., LLC (Harquahala), appealed to the Federal Energy Regulatory Commission (FERC) a decision by the North American Electric Reliability Corporation (NERC) to register Harquahala as a transmission owner and transmission operator (TO/TOP) for purposes of compliance with NERC’s mandatory reliability standards. In the case, FERC will decide whether to uphold NERC’s determination that high-voltage interconnection facilities should be treated as integrated transmission facilities for reliability compliance purposes. The decision may have significant consequences for generators that own interconnection facilities.

D.C. Circuit Strikes down EPA’s Clean Air Mercury Rule

The D.C. Circuit held that the Environmental Protection Agency lacks authority to remove electric utility steam generating units from the list of regulated source categories subject to stringent Maximum Achievable Control Technology standards under section 112 of the Clean Air Act except by applying the delisting criteria specified in the Act. The court also invalidated EPA’s Clean Air Mercury Rule, issued under section 111 as a substitute for the more rigorous controls required by section 112.

Weekly Climate Change Policy Update - February 11, 2008

Mercury and its relation to global warming legislation dominated the climate change news this week. With the federal court's rejection of the EPA's Clean Air Mercury Rule, Congress is looking to other ways in which to regulate greenhouse gas emissions.

Weekly Climate Change Policy Update - February 4, 2008

Developing countries, carbon capture and sequestration (CCS) technology, and voluntary offsets dominated the news this week. Developments included those related to climate change legislation, funding for the launch of CCS technology, the Bush Administration's withdraw of funding for the FutureGen project, and the scrutiny the retail voluntary market for GHG offsets in the U.S. is receiving.

Weekly Climate Change Policy Update - January 28, 2008

In the US, developments continue with regards to several issues including the Regional Greenhouse Gas Initiative, California Air Resources, and the EPA's rejection of the waiver for the California vehicle emissions standards. Internationally, the European Commission released its proposal for a post-2012 phase of the European Union Emission Trading Scheme, some aspects of which were received with much contention by the United States.

Weekly Climate Change Policy Update - January 22, 2008

As the House of Representatives resumed its session this week, climate change was on the top of the agenda. Specific issues included developing climate legislation, the auto industry's role in carbon emissions programs, and the EPA's denial of California’s request for a Clean Air Act waiver for its vehicle emissions standard.

Weekly Climate Change Policy Update - January 14, 2008

2008 could be an unexpectedly busy year for EPA due to many developments. It will be drafting a registry rule while finalizing a low carbon fuel standard and federal vehicle standards. At the same time, it will face legal challenges from California and the other states whose vehicle regulation plans it thwarted. The beginning of 2008 will also bring additional progress for a myriad of climate change initiatives.

DC Circuit Reconfirms FERC’s Remedial Discretion

The U.S. Court of Appeals for the District of Columbia Circuit has strongly reconfirmed the enforcement and remedial discretion of the Federal Energy Regulatory Commission (“FERC”) in its decision, Consolidated Edison Co. of New York v. FERC. No. 06-1025, (D.C. Cir. Dec. 18, 2007). The court reemphasized that on judicial review it must defer to FERC’s reasonably explained decisions because “agency discretion is at its zenith” when the agency is fashioning remedies.

Weekly Climate Policy Update - December 21, 2007

This week, President Bush signed an energy bill that significantly increases fuel economy standards for cars and light trucks, mandates greater biofuels production, and creates efficiency standards for buildings. Although the bill was not as comprehensive as earlier versions – which included a renewable portfolio standard and tax incentives for renewable energy production – it addresses a number of energy issues facing the U.S. The enactment of the bill and its increased fuel economy standards also contributed to EPA’s landmark decision to deny California’s request for a waiver to implement its vehicle CO¬2 emission standards. The denial marks the first time that EPA has denied such a waiver and sets the stage for a showdown between the state and the agency. The denial, and EPA’s reasoning for denying the waiver, may have important implications for the future of GHG regulation at the agency.

Energy Independence and Security Act Becomes Law; Congress Acts on Additional Energy-Related Bills but Issues Remain for 2008

Congress passed the Energy Independence and Security Act, an energy bill that includes new energy efficiency and renewable fuel requirements, but does not include renewable electricity requirements or energy tax incentives. Congress also adopted the omnibus appropriations bill which contains new direction on loan guarantees for advanced energy projects, and the Senate passed a farm bill containing incentives for biofuels, setting up a conference with the House of Representatives in early 2008.

Weekly Climate Policy Update - December 14, 2007

After a dramatic finish, the Bali talks produced a two-year road map for development of a successor to the Kyoto Protocol. The Bush Administration successfully avoided inclusion of any explicit emission targets in the Action Plan. However, after the 2008 Presidential election, a different team will take the field for U.S., and that team will face strong international pressure to accept binding reduction obligations.

Lieberman-Warner Climate Security Act Clears Senate Committee Markup: Future Prospects Uncertain

The Senate Committee on Environment and Public Works favorably reported the S.2191, The Lieberman-Warner Climate Security Act, by an 11-8 vote. S.2191, as reported from the full Committee, retains the major design features of the version reported from the Subcommittee on Private Sector and Consumer Solutions to Global Warming and Wildlife Protection on November 1, 2007.

Weekly Climate Policy Update - December 7, 2007

This week saw two major successful developments in Congress – Senate Committee passage of climate legislation after months of negotiation, as well as passage of an energy bill of 1,000 pages by the House of Representatives.

Weekly Climate Change Policy Update - November 30, 2007

It looks likely that the Senate Environment & Public Works Committee will report out the Lieberman-Warner bill at the end of its Dec. 5-6 markup. The bill underwent some significant surgery this week, including modifications to the allowance allocation provisions and a shift to "upstream" regulation of emissions from natural gas. Also, there are indications that the House and Senate could close on an energy bill in December. The final bill appears likely to include a substantial tightening of fuel economy standards.

Weekly Climate Change Policy Update - November 16, 2007

Chairman Boxer has decided to stick to a scheduled December 5 markup of the Lieberman-Warner bill by the full Environment & Public Works Committee. Twenty US states have now committed themselves in some way to a regional cap-and-trade program. The federal courts continue to issue decisions requiring federal agencies to account for climate change impacts in their actions.

FERC Issues Staff Report on Enforcement

On November 14, the Federal Energy Regulatory Commission (FERC) released its Staff Report on Enforcement that provides background into the evolution of its enforcement program, and shows how FERC uses its enforcement tools to encourage companies to develop effective compliance programs and to deter and punish misconduct.

Weekly Climate Change Policy Update - November 9, 2007

Presidential politics are starting to complicate Chairman Boxer's goal of passing a version of the Lieberman-Warner bill out of her Senate Environment & Public Works Committee before the Bali negotiating conference in mid-December. Senator Hillary Clinton has outlined her preferences for a cap-and-trade bill and her preferences add up to something far more aggressive than Lieberman-Warner.

FERC Issues Final Rule Amending Regulations for Processing Critical Energy Infrastructure Information

The Federal Energy Regulatory Commission issued a Final Rule amending its regulations for processing critical energy infrastructure information.

Weekly Climate Change Policy Update - November 2, 2007

A Senate Environment and Public Works Subcommittee approved the Lieberman-Warner climate change legislation in a 4-3 vote. This milestone marks the first time that a Congressional committee has reported economy-wide climate change regulatory legislation and, in many respects, marks the official beginning of a long and arduous effort to enact such legislation.

Weekly Climate Change Policy Update - October 26, 2007

The Lieberman-Warner bill got its first Congressional hearing this week in a subcommittee of the Environment & Public Works Committee. Permitting issues for coal-fired power plants remain at the forefront of the climate change debate. Read more about these and other developments in this week's Update.

FERC Issues Final Rule Revising Blanket Certificate Regulations

FERC issued a final rule amending its blanket certificate construction regulations with respect to landowner notification requirements and noise surveys for the construction of natural gas compressor units or liquefied natural gas facilities.

Lieberman-Warner Climate Change Cap-and-Trade Bill Seen as Framework for Senate Climate Debate

On October 18, Senators Joseph Lieberman and John Warner introduced climate change cap-and-trade legislation. The bill, titled America’s Climate Security Act, comes after an August 2, 2007 outline the Senators released to generate discussion and feedback, and contains some key differences from the August white paper.

Weekly Climate Change Policy Update - October 19

This was Lieberman-Warner week as the Senators finally introduced their long-expected legislation. The bill first will be considered in Senator Lieberman’s subcommittee of the Environment & Public Works Committee.

Weekly Climate Change Policy Update - October 12

Former Vice President Al Gore was awarded the Nobel Peace Prize this week, along with the United Nations (UN) Intergovernmental Panel on Climate Change. This announcement, along with the upcoming UN Climate Change Conference in Bali in December, is likely to put pressure on Democratic leaders in Congress to demonstrate some progress on climate change legislation. Also, the experience with the energy bill underscores the obstacles that this Congress will face in gaining an agreement on climate legislation.

Weekly Climate Change Policy Update - October 5

This week, the House of Representatives gave the first indication that its climate legislative machinery is moving into gear. House Energy and Commerce Chairman John Dingell and Energy and Air Quality Subcommittee Chairman Rick Boucher issued the first in what is expected to be a series of white papers on design issues for climate legislation.

Weekly Climate Change Policy Update - September 28

International climate talks at the United Nations and in Washington were top news items this week. House Commerce Committee Chairman John Dingell introduced a carbon tax bill, and several notable energy efficiency and climate change commitments were made at the Annual Meeting of the Clinton Global Initiative. Read more about these and other developments in this week's edition.

FERC Proposes to Amend Financial Reporting Requirements for Natural Gas Pipeline Companies and Seeks Comments on Fuel Retention Practices

FERC issued a notice of proposed rulemaking that would require natural gas pipeline companies to provide additional information in their FERC Form Nos. 2, 2-A and 3-Q. The Commission also issued a notice of inquiry seeking responses on specific questions relating to the Commission’s policy on fuel retention practices of natural gas companies.

New Ethics and Lobbying Reform Legislation Signed Into Law

President Bush signed into law comprehensive ethics and lobbying reform legislation that make important changes to the congressional rules governing the acceptance of gifts and travel expenses, as well as to internal congressional procedures relating to earmarks.

Weekly Climate Change Policy Update - September 21

This week, publicly-traded companies faced inquiries from two different angles regarding disclosure of risks and opportunities related to climate change.

Congress Prepares to Debate Climate Change Legislation This Fall

As members of Congress return from their August recess and begin working on a packed agenda, climate change is one of the issues expected to receive continued attention. The committees of jurisdiction in both the Senate and the House will focus on climate change legislation, and the leaders of those committees have emphasized their interest in having climate bills considered on the floor of each chamber by the end of the year.

Fall 2007 Federal Energy Outlook: Energy Bills Face Uncertainty in Conference

One of the major challenges for Congress this fall will be to reconcile, through a conference committee, the differences between energy bills passed by the House of Representatives and the Senate. This Alert discusses the status of, and outlook for, the energy bills.

Federal District Court Declares Washington Tribes’ Treaty Fishing Right Requires the State of Washington to Refrain from Building or Operating Culverts that Block Fish Passage

The U.S. District Court for the Western District of Washington issued a summary judgment order declaring that the Western Washington Tribes’ treaty right of taking fish imposes a duty upon the State of Washington to refrain from building or maintaining any culverts that block anadromous fish migration.

Ninth Circuit Adopts Justice Kennedy’s “Significant Nexus” Test As Described in Rapanos

On August 6, the U.S. Court of Appeals for the Ninth Circuit affirmed a district court holding that activities involving a pond located adjacent to a navigable water of the United States, but with typically no surface connection, are subject to the Clean Water Act.

Senators Lieberman and Warner Release Detailed Outline of Climate Change Legislation

On August 2, Senators Joseph Lieberman and John Warner released a detailed outline for a federal greenhouse gas cap-and-trade bill. The Senators are seeking comment on the outline in order to inform their effort to draft legislation to be introduced in the fall.

FERC Proposes $458 Million in Sanctions in Natural Gas Market Manipulation Cases

On July 26, the Federal Energy Regulatory Commission issued two show cause orders that make preliminary findings of market manipulation in natural gas markets and propose civil penalties totaling $329 million and disgorgement of unjust profits totaling $129 million.

FERC Proposes Approval of Mandatory Cyber Security Standards

The Federal Energy Regulatory Commission (FERC) issued a Notice of Proposed Rulemaking proposing to approve eight Critical Infrastructure Protection reliability standards and directing the North American Reliability Corporation to modify certain standards to address specific concerns raised by FERC.

FERC Moves to Clarify Rules on Merger Reviews and Cross-Subsidy Restrictions

The Federal Energy Regulatory Commission issued three orders designed to provide additional clarity and guidance concerning FERC’s merger and corporate review policies, and to strengthen its protections against unauthorized cross-subsidization of affiliates by regulated utilities.

Senators Bingaman and Specter Offer Detailed Climate Change Bill

Senators Jeff Bingaman and Arlen Specter introduced a bill that would establish a mandatory federal greenhouse gas cap-and-trade program. The “Low Carbon Economy Act of 2007” would establish a limit on GHG emissions that would take effect in 2012 and would require reductions to 2006 levels by 2020 and to 1990 levels by 2030.

Closely Divided U.S. Supreme Court Rejects Effort to Expand the Scope of the Endangered Species Act

On June 25, the U.S. Supreme Court issued a landmark decision that rejected an effort to expand the scope of the Endangered Species Act. The Supreme Court concluded that § 7(a)(2) of the ESA (§ 7(a)(2)) does not add additional requirements to statutory mandates or alter constraints placed on a federal agency’s discretion by other Acts of Congress. In doing so, the Court reversed a decision by the Ninth Circuit Court of Appeals and affirmed a long-standing U.S. Fish and Wildlife Service and National Marine Fisheries Service joint regulatory interpretation that the requirements of § 7(a)(2) are only triggered by discretionary federal agency action.

FERC Adopts New Rules for Market-Based Rate Authorization

On June 21, the Federal Energy Regulatory Commission (FERC) issued a Final Rule that codifies FERC’s requirements for market-based rate authorization.

FERC Issues Order on Rehearing Clarifying Revisions to Blanket Certificate Authority

On June 22, the Federal Energy Regulatory Commission issued an order granting in part, and denying in part, requests for rehearing and clarification of its Final Rule expanding the scope of activities authorized under its blanket certificate regulations.

U.S. District Court Upholds State Authority Under Coastal Zone Management Act to Block Siting of LNG Terminals

The U.S. District Court for the District of Maryland upheld a Baltimore County Council zoning amendment prohibiting the siting of liquefied natural gas facilities in previously designated Chesapeake Bay “Critical Areas” in Baltimore County.

EPA Proposes to Lower the 8-Hour Ozone Standard

On June 21, EPA announced its proposal to revise the 8-hour ozone National Ambient Air Quality Standard (NAAQS) to within the range of 0.070 to 0.075 parts per million (ppm).

Supreme Court Holds That Potentially Responsible Parties May Recover Voluntary Cleanup Costs Under CERCLA

On June 11th, the Supreme Court unanimously held the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA) permits a potentially responsible party (PRP) that has not been sued or ordered to participate in an administrative proceeding, to recover from other PRPs necessary response costs it incurred voluntarily.

EPA and the U.S. Army Corps of Engineers Issue Joint Guidance on Wetlands Jurisdiction

On June 5th, the Environmental Protection Agency and the U.S. Army Corps of Engineersissued joint wetlands guidance to their field offices to identify those waters over which the agencies will assert jurisdiction under § 404 of the Clean Water Act.

Energy Legislation Outlook in the 110th Congress

PHMSA Proposes to Extend Safety Regulations to Rural Large-Diameter Low-Stress Hazardous Liquid Pipelines

The Pipeline and Hazardous Materials Safety Administration (PHMSA) issued a supplement to its pending notice of proposed rulemaking (Supplemental Notice) that would extend all Part 195 safety regulations to rural large-diameter low-stress hazardous liquid pipelines.

PHMSA Adopts Design and Construction Standards for Gas Pipelines to Reduce Internal Corrosion Risks and Issues Advisory Bulletin Requiring Executive Signature and Certification of Integrity Management Performance Reports

The Pipeline and Hazardous Materials Safety Administration (PHMSA) issued a final rule adopting new regulations requiring operators of onshore gas pipelines to incorporate design and construction features in new and replaced onshore transmission and non-rural gathering pipelines to reduce the risk of internal corrosion.

FERC Proposes Daily Posting Requirements for Intrastate Pipelines and Annual Reporting Requirements for Buyers and Sellers of Natural Gas

On April 19th, the Federal Energy Regulatory Commission (FERC) issued a notice of proposed rulemaking that would (1) require intrastate pipelines to post on a daily basis capacities of, and volumes flowing through, the major receipt and delivery points and mainline segments, (2) require that buyers and sellers of more than a de minimis volume of natural gas annually report aggregate numbers and volumes of physical natural gas transactions, and (3) require all buyers and sellers of natural gas to report annually whether they sell natural gas under FERC’s blanket certificate and whether they report transactions to price index developers.

Supreme Court Overturns Fourth Circuit’s Interpretation of the Definition of “Modification” in EPA’s NSR Regulations

On April 2nd, the Supreme Court unanimously overturned the Fourth Circuit’s decision interpreting the Environmental Protection Agency’s (EPA) New Source Review (NSR) regulations in Environmental Defense v. Duke Energy Corp. The Court’s decision will likely cause difficulty for Duke Energy and other industry defendants to fend off NSR enforcement actions involving alleged major modifications to existing stationary sources.

Supreme Court Holds EPA Must Consider States’ Request for Climate Change Rule

On April 2nd, the Supreme Court decided its first climate change case and held that (1) a group of states have standing to challenge the Environmental Protection Agency’s (EPA) denial of their petition under the Clean Air Act for a rule regulating greenhouse gas (GHG) emissions from new motor vehicles, (2) that the Agency has the statutory authority to issue such a rule, and (3) that EPA’s rejection of the rulemaking petition was arbitrary and capricious.

FERC Issues Final Rule on Open Access Reform

On February 15th, the Federal Energy Regulatory Commission (FERC) issued a Final Rule (Order No. 890) amending its open access transmission regulations and pro forma Open Access Transmission Tariff (OATT). Order No. 890 represents the FERC’s first comprehensive reforms to its open access requirements since those requirements were originally promulgated ten years ago in Order Nos. 888 and 889. Order No. 890, which is over 1200 pages in length, becomes effective 60 days after its publication in the Federal Register. The rule imposes a series of compliance requirements on jurisdictional public utilities and others.

Ninth Circuit Clarifies the Requirements for Incidental Take Statements Prepared During Endangered Species Act Section 7 Consultations

The Ninth Circuit Court of Appeals issued an important Endangered Species Act decision, which clarified: (1) the legal relationship between an incidental take statement and a biological opinion; and (2) the factors that must exist for an ITS to include a surrogate measure for authorized incidental take instead of a specific numerical limit.

District Court Strikes Down Clean Water Act Tulloch II Dredging Rule

The United States District Court for the District of Columbia found that two federal environmental agencies had exceeded their statutory authority and invalidated the “Tulloch II” rule. The rule presumed that the use of “mechanized earth-moving equipment” would result in the discharge of dredged or fill material into waters of the United States and thus would require a permit pursuant to the Clean Water Act.

Second Circuit Invalidates Key Provisions of EPA’s Phase II Cooling Water Intake Rule

The U.S. Court of Appeals for the Second Circuit vacated in part, and remanded in part, a final rule promulgated by the Environmental Protection Agency intended to protect aquatic organisms from cooling water intake structures at large, existing power-producing facilities.

U.S. District Court Finds Local Zoning Law Preempted by FERC’s Exclusive LNG Terminal Siting Authority under the Natural Gas Act

The U.S. District Court for the District of Maryland determined that a zoning law promulgated by the Baltimore County Council to regulate the siting of an LNG import terminal was preempted under the Supremacy Clause of the U.S. Constitution by the Natural Gas Act, as amended by the Energy Policy Act of 2005 (EPAct 2005), which gave the Federal Energy Regulatory Commission “exclusive authority” over the siting construction, expansion and operation of liquefied natural gas (LNG) import terminals. (AES Sparrows Point LNG, LLC v. Smith, et al., CA No. RDB-06-2478).

FERC Proposes Changes to Standards of Conduct Applicable to Electric Transmission Providers

On January 18th, the Federal Energy Regulatory Commission issued a Notice of Proposed Rulemaking (NOPR) proposing, inter alia, changes to its Standards of Conduct to address impediments to integrated resource planning and competitive procurements by electric utilities. The NOPR also solicits public comment on whether the Standards of Conduct applicable to electric utilities should continue to cover all energy affiliates, or should be narrowed to cover only marketing affiliates.

More Greenhouse Gas Bills Introduced In U.S. Senate

Senator Bernard Sanders (I-VT) and Senate Environment and Public Works Committee Chairwoman Barbara Boxer (D-CA) introduced S. 309, the “Global Warming Pollution Reduction Act.” The plan – the most stringent global warming legislation introduced in the 110th Congress to date – would require the U.S. to cap greenhouse gas (GHG) emissions at 1990 levels by 2020. The national GHG cap would further tighten over the next 30 years until the cap reaches an 80% reduction below 1990 levels in 2050.

FERC Imposes Civil Penalties of $22.5 Million in First Exercise of New Authority

The Federal Energy Regulatory Commission (FERC) approved settlements with four traditional electric utilities and one independent generator in which FERC imposed civil penalties totaling $22.5 million and additional monetary remedies totaling $2.8 million. FERC stated that it relied on the factors set forth in the Policy Statement on Enforcement in assessing the penalties in each of the settlements approved on January 18th.

FERC Proposes Revised Standards of Conduct

The Federal Energy Regulatory Commission (FERC or Commission) issued a notice of proposed rulemaking to revise its standards of conduct applicable to gas and electric transmission providers. With respect to interstate natural gas pipelines, the Commission is proposing to narrow the standards’ application to cover only pipelines’ relationships with their marketing affiliates. The Commission seeks comments on whether the application of the standards of conduct should be similarly narrowed for electric transmission providers.

Senators Circulate Mandatory Greenhouse Gas Reduction Legislation

Last week, Senators John McCain (R-AZ) and Joseph Lieberman (D-CT) advanced legislative proposals for establishing mandatory caps on U.S. greenhouse gas (GHG) emissions. Separately, Senate Energy and Natural Resources Committee Chairman Jeff Bingaman (D-NM) also circulated a draft GHG bill. An analysis of the Bingaman proposal by the Energy Information Administration predicts it would curb growth in U.S. GHG emissions by half with little impact on the economy.

D.C. Circuit Decision Limits Flexibility for the Eight-Hour Ozone Standard

The U.S. Court of Appeals for the District of Columbia Circuit upheld the Environmental Protection Agency's decision to replace the existing one-hour standard with the new eight-hour standard.

FERC Issues Revised Interim Standards of Conduct for Interstate Natural Gas Pipelines

The Federal Energy Regulatory Commission (FERC or Commission) issued Order No. 690 adopting, on an interim basis, standards of conduct applicable to interstate natural gas pipelines and their marketing affiliates. The Commission plans to issue a notice of proposed rulemaking in the near future to respond to the court’s decision on a permanent basis.

DHS Proposes Rule to Secure “High-Risk” Chemical Facilities

On December 22nd, the Department of Homeland Security released an advance notice of proposed rulemaking proposing regulations to improve security at “high-risk” chemical facilities.

FERC Issues Statement of Administrative Policy Regarding Procedures to Assess Civil Penalties

The Federal Energy Regulatory Commission issued a “Statement of Administrative Policy” to provide guidance on the process for assessing civil penalties for violations of statutes, orders, rules, or regulations administered by the Commission.

FERC Staff Issues Preliminary Assessment of NERC’s Proposed Critical Infrastructure Protection Reliability Standards

Staff of the Federal Energy Regulatory Commission issued a “Preliminary Assessment” of the North American Electric Reliability Corporation’s (NERC) proposed mandatory reliability standards governing critical infrastructure protection (CIP). Certain proposed CIP standards require the direct involvement of senior management.

Ninth Circuit Modifies Mobile-Sierra Review, Eases Test for Repricing Power Sales Contracts

On December 19, 2006, the United States Court of Appeals for the Ninth Circuit issued two related decisions – Public Utility District No. 1 of Snohomish County, Washington, v. FERC, Nos. 03-72511, et al. and Public Utilities Commission of the State of California v. FERC, No. 03-74207 – that comprehensively reconsider both the applicability of the Mobile-Sierra doctrine to power sales contracts executed under the Federal Energy Regulatory Commission’s current market-based rate regime, and the appropriate “public interest” standard to be used where the Mobile Sierra doctrine is found to apply.

Ninth Circuit Holds that Ongoing Hydroelectric Operations and License Reopeners Do Not Trigger Consultation Under § 7 of the Endangered Species Act

On December 12th, in California Sportfishing Protection Alliance v. FERC, the United States Court of Appeals for the Ninth Circuit held that ongoing operations of a hydroelectric project under a license issued by the Federal Energy Regulatory Commission do not constitute a federal “agency action” triggering the consultation requirement under § 7 of the Endangered Species Act.

Congress Reauthorizes Pipeline Safety Programs and Increases Department of Transportation’s Enforcement Authority

Congress passed The Pipeline Inspection, Protection, Enforcement, and Safety Act of 2006, re-authorizing federal pipeline safety programs through 2010.

U.S. Supreme Court Hears Oral Argument in First Global Warming Case

On November 29th, the Supreme Court heard oral argument in its first global warming case, Massachusetts v. EPA, Case No. 05-1120. The case reviews a divided decision by the U.S. Court of Appeals for the District of Columbia Circuit holding that the Environmental Protection Agency reasonably exercised its discretion in refusing to regulate carbon dioxide and other air pollutants associated with climate change under the Clean Air Act.

D.C. Circuit Vacates FERC Order No. 2004's Standards of Conduct as Applied to Natural Gas Pipelines

On November 17, the D.C. Circuit issued a decision in National Fuel Gas Supply Corporation v. FERC which vacates the Federal Energy Regulatory Commission’s (FERC) standards of conduct promulgated by Order Nos. 2004, et al. as applied to natural gas pipelines, and remands the issues to FERC for further consideration.