The Nickel Report

In August 2018, the US Environmental Protection Agency announced it was rebranding its National Enforcement Initiatives as National Compliance Initiatives, and specifically stated it was no longer targeting oil and gas sources as deserving of extra scrutiny. In addition, since taking office in January 2017, the Trump administration has aggressively rolled back many environmental regulations promulgated under the Obama administration. Despite what some may perceive as a kinder, gentler EPA and the Trump administration’s “deregulatory” agenda, however, the EPA has continued to pursue enforcement cases against many of the same businesses believed to benefit the most from the administration’s policies. Notably, this includes midstream oil and gas sources, as recently evidenced by EPA’s September 2019 Enforcement Alert (EA) titled, “EPA Observed Air Emissions from Natural Gas Gathering Operations in Violation of the Clean Air Act.”

In December 2018, an article in this blog flagged a petition for EPA rulemaking under the Toxic Substances Control Act (TSCA) that, if denied, had the potential to set up precedent-setting litigation on citizens’ ability to use the courts to require EPA action under TSCA. Now, nearly a year later, the scenario that article described is coming true. In a challenge to EPA’s denial of that petition, a federal district court is poised to decide what constitutes a petition for issuance of a new rule as opposed to one for amendment of an existing rule—and in the process, to decide when a court may cast aside deference to EPA and undertake its own evaluation independent of the Agency’s record and conclusions.

California Prop 65 has allowed a slew of lawsuits to be brought by plaintiff attorneys against consumer retailers with products that end up in California.  Hunton Andrews Kurth partners Malcolm Weiss and Shannon Broome walk through the process for Prop 65 60-day notices and tactics companies can use to respond.

On August 27, 2019, the Federal Energy Regulatory Commission (FERC) and North American Electric Reliability Corporation (NERC) issued a White Paper proposing to disclose the names of entities that violate Critical Infrastructure Protection (CIP) standards, while continuing to withhold other details of those violations. This significant change in policy reflects broader issues in FERC’s handling of security information.

Going green has gone mainstream. Perhaps nowhere is this more pronounced than in the automotive industry. J.P. Morgan estimates that, by 2030, electric vehicles (EVs) and hybrids will make up 59 percent of the global market share, up from about 1 percent in 2015. What may be the most important feature of the EV revolution is its power source: lithium-ion (Li-ion) batteries. They are not new; they have been powering cell phones and computers for years. What is new is their large-scale use to power automobiles (and, some day, trucks and buses) and significantly reduce emissions. As our colleagues Samuel L. Brown and Lauren A. Bachtel note in an article to be published in the ABA’s Natural Resource & Environment magazine, components of Li-ion batteries include metals (e.g., lithium, cobalt, nickel) that are costly to extract and process. As demand for them increases, pressure to re-use or recycle batteries will increase.

Congress is exploring regulatory action for PFAS as states begin to implement their own regulations for the chemicals. Hunton Andrews Kurth attorneys, Dan Grucza and Chuck Knauss outline approaches companies can take while operating in this changing legal landscape.

Energy industry: is your insurance sufficient to handle a major cyber event? Larry Bracken, Mike Levine and I, Andrea DeField, address this question and more in our recent article for Electric Light & Power, found here.  In the article, we identify three major gaps in cyber insurance that we routinely see when analyzing coverage for energy industry clients. The first major gap is coverage for bodily injury or property damage caused by a cyber event. Most cyber insurance policies exclude coverage for both bodily injury and property damage, even if caused by a cyber event. Meanwhile ...

Last December, we reported that President Trump signed into law the Agriculture Improvement Act of 2018 (the 2018 Farm Bill). Since then, federal and state governments have rushed to implement the new law and state analogs in time for the 2020 growing season. As we have seen with the development of complex new regulatory schemes in other industries, regulatory uncertainty and opportunities abound.

In my October 16, 2018, post, I observed that a panel of the Fifth Circuit put another nail, though not the final nail, in the coffin of NSR enforcement for projects completed a long time (some of them, decades) before EPA or other plaintiffs filed a complaint alleging NSR violations. In United States v. Luminant, No. 17-10235 (5th Cir. Oct. 1, 2018), the panel unanimously ruled that the statute of limitations bars civil penalties for NSR violations that allegedly occurred more than five years before the filing of the complaint. But over a strong dissent by Judge Elrod, a 2-1 majority ruled that while injunctive relief is also barred in those circumstances for non-government plaintiffs (Sierra Club, in this case), injunctive relief is still “available” when the government is seeking to enforce the Clean Air Act.

California Prop 65 is designed to reduce exposures to chemicals that are known to cause cancer and reproductive harm, but it has become a flash point in California environmental law. Hunton Andrews Kurth partners Malcolm Weiss and Shannon Broome outline the regulations and the impacts on businesses with products in California.