Uncertainty Continues As to ESG Reporting
By E. Lynn Grayson
The importance of and how best to report on environmental, social and governance (ESG) issues remains uncertain, and what really matters appears to depend upon whether you are a corporate or an investor. The continuing difference of opinion on ESG matters is highlighted in a new survey from PricewaterhouseCoopers LLP titled Investors, Corporates and ESG: Bridging the Gap.
The survey finds that corporates view disclosing ESG data differently—corporates are focused on growth but investors are focused on risk. It is clear that sustainability reporting has become mainstream with 81% of S&P 500 companies publishing sustainability reports in 2015 compared to 20% in 2011.
Some key findings from the survey include:
65% of corporates say ESG issues are very important to the core business strategy
80% of corporates follow Global Reporting Initiative (GRI) standards for ESG disclosure reporting
31% of investors confirm that ESG data is very important to equity investment decisions
43% of investors would like to see ESG information reported using the Sustainability Accounting Standards Board (SASB) standards
A critical issue identified in the survey relates to trust and transparency of ESG disclosures. Corporates express 100% confidence in the quality of ESG information shared but only 29% of investors are confident in the quality of the ESG information received from companies.
The results of this new survey from PWC confirms that investors are increasingly interested in both financial and nonfinancial disclosures including information related to ESG matters. 36% of investors noted that having such information incorporated into SEC filings would ensure higher quality data. The SEC currently is considering corporate disclosures of ESG issues.
An Idled Pipeline Must Be an Abandoned Pipeline—New PHMSA Advisory
By Steven M. Siros
A recently issued PHMSA advisory bulletin seeks to clarify the regulatory requirements that apply to mothballed or idled unused gas or hazardous liquid pipelines. As required by the Pipeline Safety Bill that was signed into law on June 22, 2016, PHMSA recently issued an advisory bulletin providing guidance to owners and operators of gas or hazardous liquid pipelines regarding the requirements for idle and/or unused pipelines.
Although the bulletin recognizes that owners and operators often refer to pipelines that are not in operation but that might be used again in the future as “idled,” “inactive,” or “decommissioned,” the PHMSA regulations do not recognize “idle” or “inactive” status for hazardous liquid or gas pipelines. Instead, the regulations consider such pipelines to either be active and fully subject to all relevant parts of the safety regulations or abandoned. Assuming that these pipelines have not been abandoned in accordance with the requirements set forth at 49 CFR §§ 192.727 and 195.402, these pipelines must comply with all relevant safety requirements, including periodic maintenance, integrity management assessments, damage prevention programs, and public awareness programs.
The bulletin goes on to suggest, however, that in situations where the pipeline has been purged of all hazardous materials but not yet abandoned because of an expectation that the pipeline may later be used, the owner/operator may be able to defer certain of these safety requirements. Although PHMSA indicated that it intends to engage in a future rulemaking to provide further guidance as to which requirements might be deferred, in the interim the bulletin suggests that owners or operators planning to defer certain activities coordinate the deferral in advance with the regulators.
The guidance also reiterates that notwithstanding that companies might not have access to records relating to where historical pipelines might be located and/or if these pipelines were properly purged of combustibles, the owners and operators still have a responsibility to assure facilities for which they are responsible or last owned do not present a hazard to people, property, or the environment.
Please click here to see PHMSA's advisory bulletin.
California Proposes MCL for TCP
By E. Lynn Grayson
The State Water Resources Control Board has proposed a new maximum contaminant level (MCL) for 1,2,3-trichloropropane (TCP) of five parts per trillion (ppt).TCP is a manmade chemical found at industrial and hazardous waste sites. It has been used as a cleaning and degreasing solvent and also is associated with pesticide products.
California recognizes TCP as a carcinogen, and it has been found in numerous drinking water sources in the state. In August 2009, a public health goal (PHG) for TCP was developed by the Office of Environmental Health Hazard Assessment (OEHHA) for use by the State Water Board to establish an MCL. The PHG represents the level of TCP in drinking water that OEHHA believes does not pose a significant risk to health over a lifetime of exposure (70 years). The PHG for TCP is 0.0007 µg/L, or 0.7 ppt.
A drinking water standard, or MCL, establishes a limit on the allowable concentration of a contaminant in drinking water that is provided by a public water system. The State Water Resources Control Board is proposing 5 ppt as the MCL for TCP. Formal rulemaking is expected later this year, and if approved, the MCL would become effective July 1, 2017.
EPA published a technical fact sheet about TCP in 2014. More background information and guidance on the proposed MCL action for TCP also is available from the California State Water Resources Control Board.
TCP is yet another emerging chemical that has been the subject of ongoing federal and state regulatory review and discussion for several years. It also is a chemical being analyzed and assessed at the lower threshold level of ppt versus more traditional parts per billion (ppb). As is often the case, it appears that the State of California is initiating regulatory action addressing TCP concerns, and it is likely that other states will follow.
New Focus on Health and Safety of Infill Associated With Synthetic Turf Fields
By Steven M. Siros
The National Toxicology Program (“NTP”) recently announced that it intends to join the crowded playing field (pun intended) of state, federal, and international agencies that are evaluating the potential human health risks associated with synthetic turf fields. Synthetic turf fields have been the subject of ongoing assessment by U.S. EPA, the Agency for Toxic Substances and Disease Registry, the Consumer Product Safety Commission, California’s Office of Environmental Health Hazard Assessment, and the European Union’s chemicals agency. However, the NTP intends to focus specifically on the tire crumb rubber used in those turf fields and to conduct short-term in vivo and in vitro toxicology studies on the crumb rubber.
As more schools and other public facilities install synthetic turf fields, the potential health effects of the infill is an issue that is attracting increased attention. The NTP believes that its proposed study will help to fill what it views to be an important data gap. Although existing health study have not identified an elevated health risk from playing on artificial turf fields, these studies have generally focused on the potential health effects of exposure to lead other materials released from the artificial grass blades and/or exposure to possible emissions associated with the turf field in its entirety. NTP and U.S. EPA have noted that there are limited studies on the effects of exposure to the tire crumb materials specifically which will be the focus of the NTP study.
Please click here to go the NTP press release concerning its study.
TSCA Reform Act Passed, Sent to the President for Signature
By Allison Torrence
Late on June 7, 2016, the Senate voted in favor of the Frank R. Lautenberg Chemical Safety for the 21st Century Act (HR 2576) (a/k/a the TSCA Reform Act). The TSCA Reform Act regulates the manufacture, transportation, sale and use of thousands of chemicals, and provides a much needed update to the 40 year old Toxic Substances Control Act (TSCA). The TSCA Reform Act had been passed by the House in May, with overwhelming support. It was held up recently in the Senate by an objection from Senator Rand Paul (R-Ky.), who argued that he needed more time to review the complex new law. But, Senator Paul dropped his objection on June 7th, and a vote was quickly held.
The TSCA Reform Act is widely seen as an improvement over the outdated TSCA. The American Chemical Counsel praised the TSCA Reform Act as “truly historic”. Others, however, were disappointed that the TSCA Reform Act preempted state laws on chemical safety, instead of setting a floor and letting state’s set more stringent standards.
President Obama is expected to sign the TSCA Reform Act into law very soon, as the White House had endorsed the Act after it passed the House of Representatives in May.
Earth Day 2016 Special Series: April 18–22, 2016
By Steven M. Siros
In celebration of Earth Day 2016, the Corporate Environmental Lawyer blog will host a special campaign April 18-22 featuring unique news and stories about Earth Day events and activities taking place around the world, in addition to important developments in environmental law. As environmental lawyers, this is a good day for us to remember the contributions our clients and friends make to improving the environment in the communities where we live and work.
The theme for Earth Day 2016 is Trees for Earth. In anticipation of the 50th anniversary of Earth Day in 2020, planting trees is the first of five major goals that will highlighted in each of the next five years. The Earth Day Network challenges the world to plant 7.8 billion trees by 2020.
You are invited to follow and participate in our Earth Day special series next week at http://environblog.jenner.com/ and follow us on Twitter @JennerBlockEHS.
If you have any questions about our Corporate Environmental Lawyer blog or this special series, please feel free to contact me at email@example.com or 312-923-2717.
EPA Limits TCE Use in Consumer Goods
By E. Lynn Grayson
EPA recently took action under the Toxic Substances and Control Act (TSCA) to ensure no TCE containing consumer products enter the marketplace before the Agency has the opportunity to evaluate the intended use and take appropriate action. The new rule issued April 6, 2016, known as a Significant New Use Rule (SNUR), requires any company intending to make certain TCE containing consumer products provide EPA 90-day notice before making the product.
The final rule applies to TCE manufactured (including import) or processed for use in any consumer product, except for use in cleaners and solvent degreasers, film cleaners, hoof polishes, lubricants, mirror edge sealants, and pepper spray. A consumer product is defined at 40 CFR 721.3 as “a chemical substance that is directly, or as part of a mixture, sold or made available to consumers for their use in or around a permanent or temporary household or residence, in or around a school, or in recreation.”
EPA’s June 2014 Work Plan Chemical Risk Assessment for TCE identified health risks associated with several TCE uses, including the arts and craft spray fixative use, aerosol and vapor degreasing, and as a spotting agent in dry cleaning facilities. In 2015, EPA worked with the only U.S. manufacturer of the TCE spray fixative product, PLZ Aeroscience Corporation of Addison, Illinois, resulting in an agreement to stop production of the TCE containing product and to reformulate the product with an alternate chemical.
It is important to note that this regulatory action may affect certain entities with pre-existing import certifications and export notifications required under TSCA.
The rule becomes effective 60 days from its publication in the Federal Register.
Lynn Grayson and Allison Torrence Presenting At CBA Seminar On Environmental Law
By Steven M. Siros
On Wednesday, March 16, 2016, Jenner & Block partners E. Lynn Grayson and Allison Torrence will be speaking at a Chicago Bar Association CLE Seminar titled "Major Cases and Regulatory Changes in Environmental Law." Lynn Grayson will be presenting on proposed RCRA generator and pharmaceutical rules, and Allison Torrence, who is Chair of the CBA Environmental Law Committee, will be presenting on the U.S. v. Volkswagen Clean Air Act litigation.
The seminar is on Wednesday March 16, 2014 from 3–5 pm at the Chicago Bar Association, 321 S. Plymouth Court. A networking reception will be held at the CBA immediately following the seminar, from 5–6 pm.
For more information and to register for the seminar click here.
Update: Hazardous Waste Electronic Manifest System
By E. Lynn Grayson
As required by the Hazardous Waste Electronic Establishment Act (Act), EPA’s efforts are ongoing to develop an e-manifest system. EPA issued its final rule in February 2014 (79 Fed. Reg. 7518, February 7, 2014) seeking to implement the Act’s requirement to create a national electronic manifest system and impose user fees as a means to fund its development and operation. Most recently, EPA has developed an e-manifest listserv to manage communications with the regulated community.
According to EPA, the listserv will: 1) provide stakeholders with program announcements and updates; and 2) facilitate e-manifest conversations among users and other stakeholders. There will be significant progress on the e-manifest program throughout 2016-2017, so participation in the listserv will be a good way to stay informed.
Interested parties may subscribe to EPA’s listserv at https://www3.epa.gov/epawaste/hazard/transportation/manifest/e-man.htm.
EPA conducted a webinar on developments with the e-manifest system in December 2015, and the presentation provides a good overview of the program and related schedule.
Along with the hazardous waste management changes for generators recently proposed by EPA, the e-manifest system will be another significant new development for thousands of companies regulated by RCRA and subject to hazardous waste manifest requirements.
Courts Apply Increased Scrutiny to Efforts to Remand Environmental Class Actions to State Court
By Steven M. Siros
On March 7, 2016, the Ninth Circuit granted Boeing’s petition seeking to appeal the remand to state court of an environmental class action lawsuit alleging the improper disposal of hazardous chemicals into soil and groundwater at a site in Auburn, Washington. This would be the second time that Boeing has appealed an order remanding the case back to state court. In the first go-around, the district court granted plaintiffs’ motion to remand, applying the single-event exception to removal under the Class Action Fairness Act of 2005 (CAFA). Boeing appealed, and the Ninth Circuit concluded that the single-event exception to CAFA removal did not apply and directed the district court to examine plaintiffs’ separate argument in support of remand based on CAFA’s local-controversy exception. Under CAFA’s local-controversy exception, federal courts should decline to exercise jurisdiction over a class where at least two-thirds of the class are citizens of the state in which the complaint is filed and at least one defendant is a citizen of the filing state whose alleged conduct forms a significant basis of the asserted claims and from whom the class seeks significant relief.
New 2017-2019 EPA National Enforcement Initiatives
By E. Lynn Grayson
EPA recently announced seven National Enforcement Initiatives (NEIs) for FY 2017-2019. Every three years, EPA identifies NEIs to focus resources on national environmental problems where there is significant non-compliance with laws, and where federal enforcement efforts can make a difference. According to EPA, the NEIs are selected with input from the public and other stakeholders across EPA’s state, local and tribal partners.
Starting October 1, 2016 and continuing for three fiscal years, the following are the NEIs:
Reducing air pollution from the largest sources
Cutting hazardous air pollutants*
Ensuring energy extraction activities comply with environmental laws
Reducing risks of accidental releases at industrial and chemical facilities*
Keeping raw sewage and contaminated stormwater out of our nation’s waters
Preventing animal waste from contaminating surface and groundwater
Keeping industrial pollutants out of the nation’s waters*
*New for FY2017-2019 as of February 2016.
It is interesting to note that the newly identified NEIs appear to correspond to challenges that EPA recently confronted, including the Gold King Mine wastewater spill, the spill prevention litigation and settlement in New York, and the Flint, MI lead contaminated water matter, where recent government reports concluded EPA failed in its regulatory obligations to this community.
For more information, see EPA’s news release announcing these NEIs.
Court Orders New EPA Spill Prevention Rules
By E. Lynn Grayson
EPA has agreed to initiate rulemaking to better address industrial waste spills as part of a settlement with a coalition of environmental groups. The Environmental Justice Health Alliance for Chemical Policy Reform (EJHA), People Concerned About Chemical Safety (PCACS), and the Natural Resources Defense Council (NRDC), sued EPA last July alleging that the Agency had failed to prevent hazardous substance spills from industrial facilities, including above ground storage tanks. See Environmental Justice Health Alliance for Chemical Policy Reform et al. v. U.S. Environmental Protection Agency, et al., case number 1:15-cv-05705, in the U.S District Court for the Southern District of New York.
Jenner & Block Webinar: The Top Environmental, Health and Safety Issues for 2016 - What You Need to Know
By Allison A. Torrence
On Tuesday, February 23rd, from 12:00– 1:15 pm CT, Jenner & Block Partners Lynn Grayson and Steven Siros will present a CLE webinar on The Top Environmental, Health and Safety Issues for 2016 - What You Need to Know. The webinar will provide an overview of key environmental, health and safety issues in 2016 including the following topics:
Issues relating to the Corps’ jurisdiction under the Clean Water Act;
Fallout under the Safe Drinking Water Act after Flint;
U.S. EPA’s Clean Power Plan regulations, UNFCCC COP 21, and the potential regulation of aircraft GHG emissions;
Status of TSCA reform efforts;
Litigation relating to GMOs under FIFRA;
RCRA waste regulation amendments;
OSHA penalty updates;
U.S. EPA challenges;
Water scarcity and sustainability; and
Technological innovation and its impact on environmental practitioners.
To register for this free Webinar click here.
Failure to Provide Notice to Excess Insurer Dooms Insurance Recovery for Environmental Settlement
By Steven M. Siros
A California appellate court recently affirmed a lower court decision that had concluded that an insured’s failure to obtain consent from its excess insurer barred it from recovering insurance proceeds from that insurer. In 2001, a lawsuit was filed by residents of a Missouri town seeking damages against the insured relating to alleged contamination from a lead and cadmium smelting operation. Zurich Insurance Company was the primary liability insurer and had agreed to provide a defense of the action. Fidelity & Casualty of New York (“F&C”) was an excess carrier and had received notice of the underlying litigation. The matter was resolved during a mediation and the insured agreed to settle the residents' claims for $55 million. However, F&C was not notified of the settlement until a month later.
Steven Siros Presenting at a Webinar on Chemical Fingerprinting
By Allison A. Torrence
On Wednesday, February 10, 2015 from 1:00 p.m.-2:30 p.m. (Central), Partner Steven Siros will be presenting at a DRI webinar titled “Relying on Chemical Fingerprinting as a Line of Evidence in Allocation Proceedings”. The webinar will provide insights on the technical aspects of chemical fingerprinting for a variety of contaminants, including PCBs, dioxins, and chlorinated solvents. The webinar will also provide an overview of how courts have treated chemical fingerprinting from an expert witness standpoint as well as a case study demonstrating how this technique can be used to delineate co-mingled plumes. Michael Bock, with Ramboll Environ will also be presenting at the webinar. Here is a link to the webinar brochure.