The Nickel Report

In June 2023, federal agencies released their “Spring 2023” Regulatory Agendas that provide an outlook for numerous upcoming regulatory actions on chemicals which could have significant implications for the regulated community. Hunton Andrews Kurth LLP’s regulatory team have provided analyses of these upcoming regulatory actions:

• EPA’s Spring 2023 Unified Regulatory Agenda—Upcoming PFAS-Related Actions
• EPA’s Spring 2023 Regulatory Agenda—Upcoming TSCA Actions

On July 10, 2023, California Governor Gavin Newsom signed into law a suite of bills intended to facilitate the permitting and approval processes for clean energy and other infrastructure projects in California.

Enactment of these measures in conjunction with the state’s budget bill marked the culmination of negotiations between the governor and state legislators that began on May 19, 2023, when the governor’s office announced a number of legislative proposals to streamline approval and permitting processes for clean infrastructure projects in California. On the same day, Governor Newsom issued Executive Order N-8-23, creating an Infrastructure Strike Team to work across state agencies to maximize federal and state funding opportunities for California innovation and infrastructure projects. The governor’s legislative proposals and executive order reflect the administration’s commitment to infrastructure development in California.

While liability for PFAS—per- and polyfluoroalkyl substances, also known as “forever chemicals”—may be an emerging issue, the availability of insurance coverage for these and similar liability claims is not. “Commercial general liability,” or CGL, insurance was specifically designed to cover claims made by a company’s customers or customers of customers for resulting bodily injury and property damage. PFAS claims fit this bill. 

Continue reading this article on the Hunton Insurance Recovery Blog.

On May 31, 2023, the Eleventh Circuit in South River Watershed Alliance, Inc. et al. v. DeKalb County, Georgia affirmed dismissal of an environmental group’s citizen suit challenging a Clean Water Act (CWA) consent decree between DeKalb County and government regulators on “diligent prosecution” grounds. The CWA precludes citizen suits if the government is “diligently prosecuting” an action to require compliance with the same standard, limitation, or order for which the citizen suit alleges a violation. The Eleventh Circuit’s opinion may provide guidance to defendants seeking to resolve government enforcement actions and obtain protection from future citizen suits.   

On June 5, 2023, the US Department of Energy (DOE) published its US National Clean Hydrogen Strategy and Roadmap. This report addresses the Infrastructure Investment and Jobs Act (IIJA) requirement that the DOE “develop a technologically and economically feasible national strategy and roadmap to facilitate widespread production, processing, delivery, storage, and use of clean hydrogen.” Notably, in developing this strategy, Congress instructed the DOE to focus on clean hydrogen production and use from a variety of sources—including natural gas, coal, renewable energy, nuclear energy, and biomass.

In May 2023, Minnesota’s Governor Walz signed into law HF 2310, which bans the sale of certain products containing “intentionally added” per- and- polyfluoroalkyl substances (PFAS) in 2025 and then all products in 2032, and also establishes reporting requirements for products containing PFAS starting in 2026. Following Maine’s lead, Minnesota has now become the second state in the country to pass a broad ban on PFAS-containing products sold in the state. While reporting requirements apply to product manufacturers, the bans on sale, offer for sale, or distribution in the state apply to “persons,” including retailers. Companies who manufacture products for sale (and who sell) products in the state of Minnesota will need to prepare to assess the presence of PFAS in their supply chains in order to comply with these new requirements.

On June 3, 2023, President Biden signed the bipartisan Fiscal Responsibility Act of 2023 (FRA) to suspend the United States’ debt limit until January 2025. The legislation also imposes changes to the environmental review process for infrastructure projects. Most notably, the FRA amends key provisions of the National Environmental Policy Act (NEPA), a touchstone environmental statute that imposes procedural requirements for the approval of major federal actions. The amendments to NEPA are the first major changes to the statute in almost 40 years. These changes signal Congress’s intent to streamline the environmental review of projects and improve the federal permitting process for energy projects. The amendments to NEPA will likely influence (and may delay) the Council on Environmental Quality’s (CEQ) Phase 2 revisions to NEPA’s implementing regulations which are currently undergoing interagency review. The FRA also expedites the approval process for all permits for the Mountain Valley natural gas pipeline project in West Virginia.

On May 17, 2023, the US District Court for the District of Massachusetts granted summary judgment to federal government defendants and intervenor Vineyard Wind in the first of four lawsuits pending in that court challenging the development of Vineyard Wind, a 62-turbine offshore wind project being built off the coast of Massachusetts, approximately 14 nautical miles south of Nantucket and Martha’s Vineyard at its nearest point. Vineyard Wind—which is slated to be the nation’s first commercial-scale offshore wind project, with capacity to power over 400,000 homes and businesses—has been under development for several years and has met opposition from a range of constituencies, including local residents and the fishing industry.

On May 3, 2023, EPA released its proposed risk management rule under Section 6(a) of the Toxic Substances Control Act (TSCA) to impose restrictions on the manufacture, import, processing, distribution, and use of methylene chloride, a widely-used solvent in a variety of consumer and commercial applications. This is the first risk management rule proposed by EPA since it issued revised risk determinations last year based on its new “whole chemical approach” and policy for assuming that personal protective equipment (PPE) is not used by workers. It also reflects a substantial expansion of the regulatory prohibitions applicable to a chemical that was already subject to TSCA risk management restrictions, albeit more limited ones, under EPA’s prior framework for risk management actions.

EPA is proposing to prohibit the manufacture, processing, and distribution in commerce of methylene chloride for consumer use; prohibit most industrial and commercial uses of methylene chloride; require a workplace chemical protection program (WCPP) for certain identified conditions of use that are allowed to continue; and provide certain time-limited, critical use exemptions under Section 6(g) of TSCA for uses of methylene chloride that would otherwise significantly disrupt national security and critical infrastructure. Stakeholders have until July 3, 2023 to comment on the proposed rule.

On April 27, 2023, the Environmental Protection Agency (EPA) published a Proposed Rule to grant Louisiana primacy to administer and enforce the Class VI Underground Injection Control (UIC) program within its borders. EPA approval of Louisiana’s primacy application would authorize the Louisiana Department of Natural Resources (LDNR) to issue UIC permits for Class VI geologic carbon sequestration facilities and undertake compliance enforcement for such facilities located within the state. EPA has determined that Louisiana’s application meets the necessary requirements for approval and is soliciting public comments on the proposal. One of the major sticking points in EPA’s approval of Louisiana’s program has been the approach to incorporating environmental justice (EJ) into the Class VI permit process. LDNR has agreed to implement a number of EJ-focused elements into the permitting process, including robust EJ analysis and public participation.