Weekly Climate Change Policy Update - January 31, 2011

The President’s State of the Union address outlined a Clean Energy Standard, which received further elaboration in a paper subsequently issued by the White House.  The aim is to ensure that 80% of the country’s electricity comes from clean energy sources—including not only renewables, but also nuclear power, clean coal, and natural gas.  The White House announcement could enhance already existing bipartisan interest in such an approach in the Senate.  For now, there is no corresponding interest in the House—where an anti-mandates sentiment currently holds sway . . . The State of California, EPA, and the National Highway Traffic Safety Administration have reached agreement on a timetable for release of GHG and fuel economy standards for MY2017-2025 motor vehicles . . .California is exploring how to integrate crediting for carbon capture and sequestration into its A.B. 32 regulatory program . . .An EPA report concluded that natural gas-fired power generation has a higher carbon footprint than previously thought because of methane leaks in the extraction and transportation process.    

Executive Branch

• President Obama Calls for Clean Energy Target, Increased Clean Energy Investment in State of the Union Address.  In his second State of the Union address, President Obama called for extensive public investment and incentives for clean energy as a way of enhancing the country’s economic competitiveness and creating jobs. The President indicated that his proposed fiscal year 2012 budget, which will be released in a few weeks, contemplates increased financial support for clean energy research, to be financed by eliminating tax benefits for oil companies.  In addition, the President said he supported a national goal of ensuring that 80% of the country’s electricity derives from clean energy sources—including renewables, nuclear, clean coal, and natural gas—by 2035.  For more information see Van Ness Feldman Alert of January 31, 2011.  Following the speech, the White House announced that its budget plans include providing funding for three additional Department of Energy-sponsored “energy innovation hubs,” as well as a doubling of funding for the Advanced Research Projects Agency-Energy (ARPA-E).  A transcript of the President’s remarks is available at http://www.whitehouse.gov/the-press-office/2011/01/25/remarks-president-state-union-address. 
• EPA, DOT, and CARB Announce Harmonization on Timing for MY2017-2025 GHG and Fuel Economy Standards.  The Environmental Protection Agency (EPA), the Department of Transportation (DOT), and the California Air Resources Board (CARB) jointly announced that the agencies have coordinated the timing for the proposal of new vehicle greenhouse gas (GHG) and fuel economy standards for light duty passenger vehicles in model years (MY) 2017-2025.  Under the agreement, CARB will delay the release of its standards—which were initially scheduled to be proposed and finalized this spring–until September of this year, and NHTSA and EPA agreed to accelerate their rulemaking proposals to coincide with CARB.  The agreement will allow the CARB standards to reflect technical studies currently being conducted by EPA and the National Highway Traffic Safety Administration (NHTSA), and demonstrates continued commitment by all three agencies to develop a single national program for fuel economy and GHG regulation in MY 2017-2025.  The announcement is available online here.
• EPA Report to Congress Discusses GHG Impacts of Biofuels.  EPA has released a draft of its first triennial report to Congress on the environmental impacts of biofuels, as mandated by section 204 of the Energy Independence and Security Act of 2007.  Among other environmental impacts, the report discusses the results of EPA studies on the life-cycle GHG emission associated with the use of biofuels.  The report concludes that EPA’s Renewable Fuel Standard (RFS) program will result in GHG reductions of 138 million metric tons CO₂-e by 2022 relative to continued reliance on petroleum-based fuels.  In addition, the report reviews research undertaken for the RFS on the GHG emissions associated with direct and indirect land-use changes resulting from biofuels production.  According to the report, the effect of land-use change depends greatly on location; biofuels made from waste biomass or biomass cultivated on abandoned agricultural lands results in far fewer life-cycle GHG emissions than conversion of tropical rainforest.    EPA will take public comment on the draft through February 28, 2011, and has scheduled a separate peer review panel meeting on the draft for March 14, 2011.  The draft is available at http://cfpub.epa.gov/ncea/cfm/recordisplay.cfm?deid=217443#Download. 
• Browner Steps Down as Climate Change Adviser.  Carol Browner, who has served as Director of the White House Office of Energy and Climate Change Policy since President Obama took office, will resign her post in a matter of weeks.  She has not announced her future plans.  It is not clear whether the President will appoint a successor or will instead close the office. 

Congress

• Obama’s Clean Energy Proposal Gets Mixed Reviews in the Senate.  Senate Energy and Natural Resources Chairman Jeff Bingaman (D-NM) said he is “anxious to work with the president, [Energy Secretary Steven] Chu, Republicans, and Democrats to see if we can come up with a proposal that does what the President outlined.”  Sen. Bingaman also noted that “I just haven’t seen a concrete proposal yet that I thought was workable and made sense.”  Sen. Richard Lugar (R-IN), a key moderate on energy policy, told reporters that he does not know whether a clean energy standard will be a part of the energy bill he plans to introduce.  The energy bill Sen. Lugar introduced in the previous Congress included a “diverse” energy standard, but Sen. Lugar told reporters “I presume that it might but I am reserving the right until we work with our other legislators to see what we are going to include.”  He also said that “I suspect to the extent that we begin now to edge into a good many more federal mandates that we run into some of the hazards” from the cap-and-trade debate.  “We are hoping to build a constituency of people that really like to save energy and save money.”
• Senate Rules Reform Deal Struck.  In response to a campaign led by Democrats Tom Udall (NM), Jeff Merkley (OR), and Tom Harkin (IA) to reduce the opportunities for obstructionism in the Senate, Senate Majority Leader Harry Reid (D-NV) and Minority Leader Mitch McConnell (R-KY) have reached a largely non-binding reform agreement. Majority Leader Reid has committed to “fill the tree” less often (a tactic used to prevent the minority party from getting a vote on controversial amendments to legislation under consideration).  Minority Leader McConnell has committed to reduce the number of filibusters of procedural motions; in the past, such filibusters effectively have given Republicans two chances to block a bill.  The two party leaders have also agreed to reduce by approximately one-third the number of presidential appointments that are subject to Senate confirmation, and to ban senators from forcing amendments to be read aloud, provided the amendment has been available to the public for 72 hours. The Senate also passed a resolution by a 92-4 vote that requires the identity of any Senator who uses an anonymous hold to stall a nominations or bill to be printed in the Congressional Record within two legislative days.
• EPA Bills Proliferate in the Senate.  Sen. Lisa Murkowski (R-AK) said that she is looking to amend Sen. Jay Rockefeller’s (D-WV) bill—which would delay EPA regulation of stationary sources GHG emissions for two years—to address the impacts of GHG regulations already in effect.  Sen. Rockefeller accused Sen. Murkowski of abandoning his bill, and told reporters:  “She wants to do more to EPA than I want to do . . . obliterate it, or whatever.  I voted with her the first time, and it was sort of a symbolic statement I wanted to make to my state, and now I’m past symbolism.”  Sen. Murkowski also expressed support for Sen. John Barrasso’s (R-WY) plans to introduce legislation to eliminate the federal government’s authority to regulate GHG emissions under a broad array of laws.  Sen. David Vitter (R-LA) has already introduced a bill (S. 25) that would prohibit regulation of carbon dioxide emissions in the United States until China, Russia, and India “implement similar reductions.”  Senate Majority Leader Harry Reid (D-NV) has said he will not bring to the floor for a vote any bill that would erode EPA’s authority to regulate GHG emissions.
• Boxer Introduces Green Buildings Bill.  Sen. Barbara Boxer (D-CA) introduced legislation (S. 77) to create a Building Pollution Reduction Program under the Clean Air Act.  The program would provide grants to fund reductions of direct and indirect emissions of conventional pollutants and GHGs from buildings.  The language of the bill is very similar to certain language included in the broader Kerry-Boxer climate bill introduced in the last Congress.
• Waxman Seeks Probe of Climate Skeptic.  Representative Henry Waxman (D-CA), ranking member of the Energy and Commerce Committee, wrote committee Chairman Fred Upton (R-MI) to ask for an investigation into whether climate skeptic Patrick Michaels “misled” the committee when reporting what percentage of his funding comes from the oil and gas industry.  According to the letter, Michaels recently said that 40% of his funding is from the petroleum industry, compared to the 3% he reported to the committee in early 2009.

Judicial

• Kivalina Defendants Seek Stay While Supreme Court Considers Climate Change Lawsuit.  The defendants in Native Village of Kivalina v. ExxonMobil have filed a petition asking the United States Court of Appeals for the Ninth Circuit to delay its consideration of the case until after the Supreme Court decides potentially relevant legal issues in the case of Connecticut v. American Electric Power.  Filed in 2008, the Kivalina suit was brought by Alaska natives residing in the village and city of Kivalina against twenty-four major energy companies.  Plaintiffs argued that GHG emissions from defendants’ operations constitute a public nuisance under federal and state common law, and sought damages to cover the cost of relocating the village away from rising sea levels that plaintiffs attribute to climate change.  A Federal district court dismissed the complaint in October 2009 on the grounds that the plaintiffs’ complaint presented a non-justiciable “political question”; an appeal is pending.  The Supreme Court is expected to reach a decision in Connecticut, which also involves federal common law claims based on climate change-related injuries, towards the end of the current term. 

States and Cities       

• California Superior Court Bars Further Cap-and-Trade Implementation Pending CEQA Compliance.  In Association of Irritated Residents, et al. v. California Air Resources Board, et al., the Superior Court of California for the County of San Francisco (Superior Court) issued a “tentative statement of decision” (Tentative Decision) that prevents the California Air Resources Board (CARB) from implementing a state-wide GHG regulatory program under A.B. 32 until the agency complies with the requirements of the California Environmental Quality Act (CEQA), the state’s version of the National Environmental Policy Act.  A.B. 32, the state’s landmark 2006 climate change statute, required CARB to develop a regulatory program to reduce state-wide GHG emissions to 1990 levels by 2020.  In response to this mandate, the Board of CARB already approved a first set of comprehensive regulations in December 2010; the regulations were based on an earlier “Scoping Plan” developed by the CARB staff.   The Tentative Decision partially grants a petition for a writ of mandate brought by a coalition of environmental justice organizations (Petitioners) that alleged that CARB’s Scoping Plan violated both A.B. 32 and CEQA.  Although the Superior Court denied all claims related to A.B. 32, the court found that CARB: 1) failed to adequately discuss and analyze the impacts of alternatives in its proposed Scoping Plan as required by its CEQA implementing regulations; and 2) improperly approved the Scoping Plan prior to completing the environmental review required by CEQA.  In upholding the Petitioners’ challenge on these two CEQA issues, the Superior Court issued a Peremptory Writ of Mandate and enjoined CARB from further implementation of the Scoping Plan until it complies with all CEQA requirements.  Parties to the case have 15 days from the issuance of the Tentative Decision to file objections before the Superior Court issues a final decision in the case. 
• California Panel Recommends Incorporating CCS Into GHG Program.  In other California news, the Carbon Capture and Storage Review Panel (Panel), an expert panel formed by three state agencies, issued a report recommending that CARB incorporate carbon capture and sequestration technologies (CCS) into the state’s A.B. 32 GHG reduction program by making reductions achieved through CCS eligible as offset credits.  The Panel is composed as a joint project of CARB, the California Energy Commission and the California Public Utilities Commission.  The Panel’s work is responsive to CARB’s December 16, 2010 decision on the A.B.32 regulations, which recommended the CARB staff initiate a public process to develop a CCS protocol.  The Panel’s report addresses key legal, economic and safety issues that affect the development and deployment of CCS technologies.  The report recommends that CARB create an industry trust fund to enable long-term management of CCS sites, but the report does not otherwise address the key issue of CCS liability.  The Panel’s report is available at http://www.climatechange.ca.gov/carbon_capture_review_panel/documents/2011-01-14_CSS_Panel_Recommendations.pdf.  
• New Mexico Supreme Court Rejects Governor’s Moratorium on GHG Rule.  The New Mexico Supreme Court ruled unanimously that new Governor Susana Martinez (R) violated the state Constitution when she prevented the publication of a GHG rule passed by the state Environmental Improvement Board last December.  The Governor had prevented publication of the rule under an executive order that placed a 90-day moratorium on the publication of all “pending and proposed” rules to allow review by a business task force created by the Governor.  Under state law, new regulations do not go into effect until they are published in the state register.  In its decision, the Court held that the GHG rule is final and it also issued a writ of mandamus directing the state records administrator to publish the rule, which provides for the implementation of a backstop GHG cap-and-trade program in the event that the state does not participate in the Western Climate Initiative (WCI).
• Arizona Withdraws Support for EPA GHG Endangerment Finding.  The U.S. Court of Appeals for the District of Columbia Circuit approved a motion by Arizona Attorney General Tom Horne (R) requesting that the state be removed from litigation over a decision by the Environmental Protection Agency (EPA) that GHG emissions are a threat to human health and welfare.  Arizona was one of 20 states to support the Obama Administration’s endangerment finding in the lawsuit and had signed briefs supporting the EPA position as recently as January 10, 2011.  The endangerment finding is a key piece in EPA’s GHG regulatory program in that it provides the legal basis for the agency to promulgate rules regulating GHG emissions under the Clean Air Act.

Industry and NGOs

• Industry, Environmentalists React to State of the Union Address.  President Obama’s State of the Union call for a clean energy target prompted mixed reactions from environmentalists and clean energy advocates.  The Natural Resources Defense Council called the target an “ambitious goal” that, if properly implemented, “will foster will foster more renewable electricity and energy efficiency and encourages us to leave behind old dirty technologies we have propped up for too long already.”  Denise Bode, CEO of the American Wind Energy Association, said the organization was “pleased to see the possibility of the first predictable long-term federal policy toward renewable energy” but that “we'll need to make sure the policy really deploys the renewable energy Americans want in the near term, as well as the long term.”  The Nuclear Energy Institute also expressed support for the proposal, calling it more “inclusive” than Renewable Energy Standard proposals debated in the last Congress.  However, Physicians for Social Responsibility criticized the President for regarding coal generation with carbon capture and sequestration as a clean energy resource, and an American Council on Renewable Energy representative said the President’s target needs to be supplemented with interim targets for deployment of renewable energy.  The U.S. Chamber of Commerce’s Institute for 21^st Century Energy also voiced opposition to the President’s proposal, calling it “unrealistic” and asserting that it “picks winners and losers.” 

Studies and Reports

• Report Warns of Security Risks from Climate Change Impacts on Water, Food.  A report by the International Institute for Strategic Studies found that climate change could increase instability in Afghanistan, Iraq, and central and western Africa and thereby threaten global security.  The report also recommends including water and food infrastructure as central components of climate change impact planning in order to address the potential for conflict over decreased water supplies and food shortages.  The report also calls for military and intelligence personnel to be given a prominent role in climate policy design, because of their experience in strategic planning under conditions of uncertainty.

International

• UNFCCC Adds April Climate Session in Bangkok To Calendar.  The United Nations Framework Convention on Climate Change (UNFCCC) has added an extra session to the climate change negotiating schedule for 2011.  The talks will take place from April 3-8 in Bangkok, Thailand.  The negotiating schedule already includes major climate talks in Bonn, Germany in June and a year-end meeting in Durban, South Africa.  The full UNFCCC negotiations calendar is available at http://unfccc.int/meetings/unfccc_calendar/items/2655.php.