Sustainability Law Blog

The latest House bill to extend various renewable energy production tax credits (HR 5351) is an important lynchpin to keeping the country moving forward as it weans itself from fossil fuels. The bill deserves the support of everyone interested in renewable energy and sustainability issues. The current bill would extend the production tax credit (used mostly for wind, biomass and landfill gas projects) to December 31, 2011, and would extend the investment tax credit (used primarily for solar projects) to December 31, 2016. It also would create a new, 50 cent-per-gallon tax credit to produce cellulosic ethanol, a $4,000 tax credit for plug-in hybrid vehicles, and modify various other, smaller renewable energy tax credit and bond programs.

As with similar legislation that stalled in 2007, the bill pays for the cost of these tax credits by repealing certain tax deductions enjoyed by the oil and gas industries. Repeal of these deductions was the source of Republican and administration opposition in 2007, and a repeat of those objections should be expected this year.

Posted by David J. Petersen, partner practicing in the Sustainability and Real Estate & Land Use Practice Groups.

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Yesterday I outlined failed or stalled attempts by Massachusetts, California and other states to curb vehicle GHG emissions. While Massachusetts v. EPA is a stalled victory at best, and denial of California's Clean Air Act waiver request is so far a major setback for the states, the states have achieved one recent victory.

In Center for Biological Diversity v. National Highway Traffic Safety Administration, 50 F.3d 508 (9th Cir. 2007), the Ninth Circuit ruled that the National Environmental Policy Act requires all federal projects to be evaluated for both project-specific and cumulative GHG emissions impacts.

The NHTSA (National Highway Traffic Safety Administration) has petitioned for a full court rehearing of the case. If the decision stands, it will have a major impact on NEPA analysis for a wide range of federal activities. Among the requirements will be that carbon dioxide emissions must be monetized in any cost-benefit analysis of a particular project. (The NHTSA had concluded that since the value of carbon dioxide emissions could not be easily determined, they should be valued at zero.)

Continue reading " One Winner in Reducing GHG Emissions from Vehicles " »

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In the absence of federal regulation of greenhouse gas emissions from vehicles, states have tried to take action but so far have had mixed results in the legal arena.

In Massachusetts v. EPA, 127 S.Ct. 1438 (2007), the Supreme Court ruled that carbon dioxide is an air pollutant under the Clean Air Act. This decision obligates the EPA to set emissions standards if it determines that carbon dioxide causes or contributes to air pollution that may endanger public health and welfare. Despite the Supreme Court's order, on February 29th the EPA said it has "no specific timeline" for making that determination. Given the lame duck status of the current administration, I'd be very surprised if anything further happens before 2009.

More significant to regulating vehicle GHG's in the near-term is the status of California's 2005 request for EPA to waive Clean Air Act standards and thereby allow the state to implement standards that would regulate vehicle emissions more strictly. While the Act gives only California the right to request a waiver, if it is granted, other states may follow. Oregon is among 18 states that have adopted or are adopting California’s standards.

Under pressure from Congress, the courts and the states to make a decision, in December 2007 the EPA denied California’s waiver request. Ironically, the denial came mere hours after President Bush signed the Energy Independence and Security Act of 2007 which, among other things, increased automobile fuel efficiency standards for the first time in decades.

Continue reading " Mixed Success on State Efforts to Reduce Vehicle GHG Emissions " »

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Much commentary can be found in the mainstream media today about the negative impacts of first-generation biofuels, mainly corn-based ethanol and soy-based biodiesel. Among the most commonly-heard criticisms are that the biofuels industry has increased demand for corn and soy, leading to higher prices for those commodities, which in turn leads to higher food prices. Critics also allege that demand for acreage for biofuels production increases the speed at which rainforests and other native ecosystems are cleared for food production, causing a "carbon debt" that is not fully offset by the emission savings from use of biofuels. Finally, naysayers assert that the carbon released from burning fossil fuels in the production of biofuels more than offsets the carbon savings.

All of these criticisms have some merit. However, those who crow about rising food costs usually fail to attribute any economic benefit to the increased use of non-fossil fuels, such as reduced carbon emissions and expenditure of energy dollars in America rather than abroad. While these benefits may not be easy to quantify on the individual level, they are real and go a long way toward offsetting the average consumer's increased food costs. Also, if we are going to blame the biofuels industry for increased cultivation of native ecosystems, we should equally blame those industries that convert farmland to subdivisions or that grow non-food crops like flowers, cotton and tobacco. All of those uses can equally be said to increase pressure on other land to meet the world's food supply needs. Finally the fossil-fuel argument is circular – as biofuels become more incorporated into our economy, the amount of fossil fuel burned in biofuel production will go down.

Continue reading " Corn and Soy-Based Biofuels Are A Waypoint, Not A Destination " »

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David Petersen and I recently returned from Las Vegas where Tonkon Torp was an exhibitor at the Power Gen Renewable Energy & Fuels expo held February 19-21. I was impressed by the scope and diversity of exhibitors and attendees at the event. We met people from all over North America, Europe, Asia, and Australia involved in wind, solar, biofuels, geothermal, and wave energy as developers, manufacturers, investors, and economic development agencies. The Northwest was well-represented, too. Tonkon Torp exhibited with fellow members of the Northwest Energy Technology Collaborative, a group made up of a mix of industry, service providers, and governmental agencies. At the show, we were able to highlight some of the unique incentives, such as Oregon’s Business Energy Tax Credit, that make the Northwest such a great place to locate renewable energy projects and businesses. In all, it was a great trip, and I came back feeling energized and excited about renewable energy here in the Northwest and around the world.

Posted by Kimberlee A. Stafford, attorney practicing in the Sustainability and Real Estate & Land Use Practice Groups.

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In the continued absence of meaningful federal involvement in controlling carbon emissions, local and regional governments continue to press forward. Both the Regional Greenhouse Gas Initiative, consisting of ten northeastern states, and the Western Climate Initiative, consisting of six states and two Canadian provinces (with six more states and three more provinces participating as observers), have announced timelines for the design of final greenhouse gas emission credit trading mechanisms. RGGI anticipates awarding a contract to a private auction company by April. The WCI member states and provinces expect to sign a memorandum of understanding for a regional cap-and-trade system by August. In both cases, the initiatives will then rely on the regulatory and legislative authorities of their individual members to implement the programs by legislation and rulemaking. Another regional climate initiative in the upper Midwest remains in its more formative stages.

Posted by David J. Petersen, partner practicing in the Sustainability and Real Estate & Land Use Practice Groups.

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