The Trump Administration Issues Proposed "Waters of the United States" Rule Under CWA
By Gabrielle Sigel
On December 11, 2018, the U.S. EPA and the U.S. Army Corps of Engineers jointly issued a proposed rule to define the basic jurisdictional reach of the federal Clean Water Act (“CWA”), which applies to protection of the “navigable waters” of the U.S. The proposed rule defines the term “waters of the United States,” which establishes the scope of waters subject to the CWA (“the Proposed WOTUS Rule”). The definition of WOTUS has been the subject of decades of litigation, including at the U.S. Supreme Court, see Rapanos v. U.S., 547 U.S. 715 (2006), itself a divided opinion. The Trump Administration’s WOTUS rule, when issued in final, would replace the definitional rule issued in June 2015 by the Obama Administration. 80 Fed. Reg. 37054. Obama’s 2015 rule itself was the subject of litigation; including after the Trump Administration attempted to delay application of that rule. See, e.g., Puget Soundkeeper Alliance v. Wheeler, No. C15-1342-JCC (W.D. Wash. Nov. 26, 2018). As of now, 28 States are not subject to the 2015 rule, but to the definition of WOTUS pursuant to rules issued in 1977 and the 1980s, as well as decisions of the Supreme Court and the agencies’ guidance and practices.
The Proposed WOTUS Rule, which the Trump Administration states is consistent with the Rapanos plurality opinion written by Justice Scalia, purports to provide “clarity, predictability, and consistency” and, by limiting the scope of the CWA’s jurisdiction, “gives states and cities more flexibility to determine how best to manage waters within their borders.” By setting forth “six clear categories of waters” that are considered WOTUS, the Proposed WOTUS Rule seeks to ensure that the CWA applies only to those waters “that are physically and meaningfully connected to traditional navigable waters.” The six categories are, in general:
- Traditional Navigable Waters (“TNW”s) – large water bodies used in interstate or foreign commerce, e.g., the Mississippi River, and including territorial seas
- Tributaries – rivers and streams that flow to TNWs, which flow more often than just when it rains, e.g. Rock Creek, a tributary to the Potomac River
- Certain ditches – an “artificial channel used to convey water,” if they are TNWs (e.g. the Erie Canal), are subject to tides, or are constructed in a tributary or in an adjacent wetlands
- Certain lakes and ponds – TNWs; water bodies that contribute by perennial or intermittent flow downstream to TNWs; or are flooded by another WOTUS
- Impoundments – impoundments of otherwise defined WOTUS
- Adjacent wetlands – wetlands that physically touch other WOTUS; wetlands with a surface water connection in a typical year from inundation or perennial or intermittent flow; wetlands that are near a WOTUS but not physically touching due to a physical barrier if they are flooded or otherwise reconnected over the surface of the physical barrier
See the exact language of the six categories in the Proposed WOTUS Rule here.
The Proposed WOTUS Rule also specifies waters that would not be considered WOTUS, including features that contain water only in response to rain; groundwater; most farm and roadside ditches; and stormwater control features.
The Administration states that the new rule would eliminate the “time-consuming and uncertain process of determining whether a ‘significant nexus’ exists between a water and a downstream [TNW],” which has occurred since Justice Kennedy’s Rapanos opinion using the “significant nexus” language. The Administration also notes that the new rule, when final, would narrow the scope of WOTUS by eliminating some “ephemeral” streams and all such ditches. In addition, certain non-navigable lakes and ponds and other wetlands would no longer be regulated under the CWA. Perhaps the most dramatic change would be in the scope of wetlands which, if physically separated, would require a direct hydrologic surface connection to an otherwise recognized jurisdictional waters to be included within CWA jurisdiction.
Any new WOTUS rule, like its predecessors, will be subject to extensive litigation and further interpretation. The Administrator’s focus on surface bodies is likely to be a prime basis for substantively contesting the rule.
The Proposed WOTUS Rule is subject to written public comment, during a 60-day period after the Proposed Rule is formally published in the Federal Register. Comments can be submitted electronically at Docket ID No. EPA-HQ-ow-2018-0149.
Matthew Lawson to Present at the Chicago Bar Association on the Environmental Impacts of Blockchain
By Allison A. Torrence
On Thursday, November 29th, Jenner & Block Associate Matthew Lawson will be giving a CLE presentation on the “Environmental Impact of Blockchain” at the Chicago Bar Association’s Young Lawyers Environmental Law Committee Meeting. Matthew Lawson’s presentation will discuss both the negative environmental impacts caused by the growth in popularity of cryptocurrency mining, and the potential positive impacts on the environment from emerging and future applications of the Blockchain technology.
The presentation is on November 29, 2018, from 12:15 PM - 1:30 PM at the Chicago Bar Association, 321 S. Plymouth Ct. Chicago, IL 60604.
For more information on the event click here.
ATSDR and U.S. EPA--Conflicting Guidance Regarding Emerging Contaminant Regulatory Standards?
By Steven M. Siros
The director of the Agency for Toxic Substances and Disease Registry (ATSDR), Peter Breysse, continues to defend his agency's minimal risk levels (MRLs) for perfluorinated chemicals that were released in June 2018 as part of a draft toxicological profile. In response to questions posed at a recent Senate hearing, Breysse noted that ATSDR’s draft MRLs roughly corresponded to drinking water levels of 14 parts per trillion (ppt) for perfluorooctane sulfonate (PFOS) and 21 ppt for perfluorooctanoic acid (PFOA). Where these levels are exceeded, ATSDR has recommended that residents take steps to lower their exposures and contact state and local authorities. Breysse also recommended that residents consult with physicians and noted that ATSDR has information on its website for physicians to consult regarding exposure risks for these chemicals.
The drinking water levels referenced in the ATSDR toxicological profile (14 ppt for PFOS and 21 ppt for PFOA) correspond generally with regulatory standards implemented in several states, including New Jersey and Vermont, both of which have the lowest regulatory levels for these compounds in the United States. However, the ATSDR MRLs are much stricter than U. S. EPA’s drinking water advisory level of 70 ppt. In addition, many news outlets reported that U.S. EPA had sought to delay ATSDR’s issuance of its June 2018 toxicological profile. Perhaps coincidentally, at about the same time as ATSDR issued its draft report, U.S. EPA announced plans to begin to evaluate the need for a maximum contaminant level (MCL) for PFOA and PFOS.
Although ATSDR and U.S. EPA continue to work cooperatively (at least on paper) to address PFOA and PFOS at contaminated properties throughout the United States, it remains to be seen how well these agencies will cooperate in setting an MCL for these contaminants. The agencies' "cooperative" relationship may face choppy waters, especially in light of ATSDR's continued defense of its MRLs and U.S. EPA's skeptical view regarding same.
In Midterm Elections, Colorado Voters Reject High Profile Anti-Fracking Initiative
By Matthew G. Lawson
On Tuesday, November 6th, Colorado voters rejected a highly contested ballot initiative which would have set unprecedented limits on oil and gas drilling in the state. The measure, Proposition 112, would have prohibited drilling new oil or natural gas wells within 2,500 feet of certain occupied buildings—including homes, schools and hospitals; various water sources—including lakes, rivers and creeks; and other areas specifically designated as “vulnerable” by the state. In total, a report from the Colorado Oil & Gas Conservation Commission estimated that the measure would have prohibited new hydraulic fracturing operations on as much as 95% of the land in Colorado’s top oil and gas producing counties.
The proposition received a high degree of pre-election attention, with individuals from politician Bernie Sanders to actor Leonardo DiCaprio encouraging Colorado voters to support the initiative. While early polling indicated Proposition 112 was supported by the majority of Colorado voters, the initiative was ultimately defeated with 57% of the state’s voters opposing it in Tuesday’s elections. In what may have served as a fatal blow, Colorado’s governor-elect, Jared Polis, distanced himself from the ballot initiative in the days leading up to the election. The newly elected Democrat had campaigned as a pro-environment alternative to his Republican opponent, but categorized the ballot initiative as “economically damaging” to the state of Colorado.
At present, New York, Vermont, and Maryland are the only states to have established outright bans on fracking. None of those states, however, has oil and gas reserves approaching the production capacity of Colorado. The state’s oil and gas industry has grown dramatically in the last decade, with the state’s production of crude oil rising from 73,000 barrels per day in 2008 to 477,000 barrels per day in August 2018. As the state’s production of oil and gas continues to grow, it appears likely that legislative battles over fracking regulations will continue to unfold.
New Jersey Federal District Court Dismisses Enviro’s Constitutional Challenges to FERC’s Approval of PennEast’s $1B Gas Pipeline, Holding that the Court Doesn’t Have Jurisdiction under the Natural Gas Act
By: Alexander J. Bandza
On Monday, in N.J. Conservation Found. v. FERC (No. 17-11991), the U.S. District Court for the District of New Jersey dismissed the New Jersey Conservation Foundation’s (“NJCF”) suit against the Federal Energy Regulatory Commission (“FERC”) because the Court found that the courts of appeals, and not it, had subject matter jurisdiction under the Natural Gas Act (“NGA”). NJCF’s suit sought to declare that FERC’s practice of issuing certificates authorizing the construction of natural gas pipeline facilities violated the U.S. Constitution. While pled solely against FERC and its Commissioners, the case was predicated on FERC’s prior approval of PennEast Pipeline Company, LLC’s (“PennEast”) right to construct a $1B interstate natural gas pipeline. NJCF’s case centered on three purported Constitutional issues with FERC’s environmental analysis: (1) FERC’s approvals that delegate the power of eminent domain in the absence of adequate public use analyses violate the Takings Clause; (2) FERC’s approvals that grant eminent domain prior to receiving environmental impact findings from regulatory agencies violate the Fifth Amendment; and (3) FERC’s approvals that provide for subsequent state or federal authorizations, which then may require changes to the pipeline route or prevent construction, also violate the Takings Clause. The Court granted FERC’s motion to dismiss, holding that the Court did not have subject matter jurisdiction because the NGA vested the courts of appeals, not district courts, with exclusive jurisdiction to hear NJCF’s claims. NJCF is another voice in a growing chorus of district court and appellate cases that have rejected dissatisfied parties’ collateral attempts to re-litigate FERC’s decisions and decision-making processes, especially with regard to environmental issues, outside of FERC.
The FERC Proceedings
In September 2015, PennEast submitted an application under the NGA to construct and operate an interstate natural gas pipeline from Pennsylvania to New Jersey. Numerous parties, including NJCF, intervened in that FERC proceeding and submitted comments to FERC. FERC’s Office of Energy Projects (“Office”) initiated an environmental review process under the National Environmental Policy Act to study the pipeline’s potential environmental impacts. The Office concluded that the pipeline would result in some adverse effects, but they would be reduced to “less than significant levels” with certain mitigation measures. The Office recommended that FERC’s final authorization, if any, should include these mitigation measures.
On January 19, 2018, FERC issued its Certificate Order of “public convenience and necessity” adopting the Office’s findings. FERC then granted a Certificate to PennEast, subject to compliance with environmental and operating conditions. Numerous parties, including NJCF, filed requests for rehearing and moved to stay the Certificate Order. FERC ultimately issued a final order denying rehearing. NJCF and others sought review of FERC’s PennEast orders in the D.C. Circuit in addition to instant matter, which contained Constitutional claims and was filed in the New Jersey District Court.
The New Jersey District Court’s Opinion
FERC moved to dismiss NJCF’s complaint for lack of subject matter jurisdiction, arguing that the New Jersey District Court lacked jurisdiction to hear NJCF’s claims because the NGA vests the courts of appeals with exclusive jurisdiction to hear matters relating to a pipeline certificate proceeding. The Court agreed and dismissed NJCF’s complaint, holding that the “weight of the authorities” is that the NGA explicitly precluded the Court’s review of NJCF’s Constitutional claims.
According to the Court, the NGA confers on FERC “exclusive jurisdiction” over the “transportation and sale of natural gas in interstate commerce.” Op. at 2. Another section of the NGA provides that once a party requests rehearing of a FERC order, a party aggrieved by that particular order may seek judicial review in a court of appeals. Id. at 3. NJCF argued that the NGA’s statutory language limiting the avenues of review did not apply here because its case instead challenged “FERC’s general pattern and practice of granting unconstitutional certificates.” Indeed, the Court recognized that NJCF “painstakingly characterize[d] its claims as constitutional in nature . . . — whether a conditional certificate, issued by FERC, that is not sufficient to authorize pipeline construction may constitutionally permit a private company to condemn land for a pipeline that may never be built.”
Despite NJCF’s artful pleading, the Court surveyed the substantial number of decisions holding that because the NGA’s exclusive jurisdiction provision is so broad in scope, the NGA is the “exclusive remedy for matters relating to the construction of interstate natural gas pipelines.” Id. at 7-18. The Court had no shortage of colorful language from the collection of “well-settled” authorities in support of its holding: Third and Fourth Circuits—“there is no area of review, whether relating to final or preliminary orders, available in the district court”; Sixth Circuit—“exclusive means exclusive”; Tenth Circuit—it “would be hard pressed to formulate a [statutory framework] with a more expansive scope”; and First Circuit (although under the Federal Power Act’s similar provision)—challenges brought in the district court outside that scheme are “impermissible collateral attacks.” As a result, according to the Court, NJCF “cannot escape the NGA’s statutory scheme of review by circumventing [its] plain language.”
The Court’s opinion is available here.
The United States’ Largest Wholesale Energy Provider Launches Blockchain-Based Pilot for Renewable Energy Markets
By Matthew G. Lawson
On April 18, 2018, the Corporate Environmental Lawyer published a blog entry discussing the growing use of Blockchain technology by startup companies seeking to connect populations without access to traditional electricity markets to electricity produced by distributed renewable energy systems. As discussed in that blog entry, proponents of Blockchain technology have asserted the platform’s built-in efficiencies would allow it to compete with traditional, utility-owned electrical grids, with one company going as far as setting up a “micro-grid” in Brooklyn, New York. It appears that the marriage between Blockchain and the electricity grid may be moving forward at an accelerated pace as the technology is now being examined and piloted by major utility operators.
PJM Interconnection (“PJM”), the United States’ largest power grid operator and market administrator serving over 65 million people from Chicago to Washington D.C., has announced its intention to test a Blockchain system that will allow clean-energy buyers and sellers to trade the renewable energy credits that wind and solar farms produce as they generate electricity. Working through its subsidiary—PJM Environmental Information Services—PJM has announced a partnership with Energy Web Foundation, a nonprofit entity with experience developing Blockchain platforms for smaller energy markets in Europe and Asia. The partnership hopes to rollout a pilot for the program by the end of the first quarter of 2018. “This collaboration between EWF and PJM-EIS is a major milestone for the adoption of advanced digital technologies in the energy sector,” said Hervé Touati, CEO of Energy Web Foundation. “We are excited to partner with a leader such as PJM-EIS.”
Blockchain, the technology that functions as a public ledger underpinning digital currency transactions, continues to be promoted as a key driver of growing renewable energy markets. At its core, the belief that Blockchain can spur renewable energy growth and disrupt current energy markets stems from the potential built-in efficiencies of the technology, which allow buyers and sellers of clean power to interact directly, without the need for a central coordinator. While the potential impact of Blockchain on future energy markets is still unknown, the successful use of the technology by PJM could represent a major milestone in the growth and development of the technology in the marketplace.