Green Homes and the Changing Demands for Sustainable Real Estate

Photo: Jeremy Levine

With Hurricanes Harvey and Irma dominating our thoughts these last few weeks, national news headlines are paying more attention (see here or here for examples) to the resilience of our built infrastructure.  That's a step in the right direction, of course, though a priority on environmental sustainability and resilience needs to be maintained (especially suring times of relative environmental calm) in order to foster meaningful long-term policy changes. 

It's a welcome sign, then, that the real estate market itself is showing signs of increasing interest in green homes.  Greg Geilman, a realtor who blogs about shifting trends in the real estate market, provides the guest post below.  His points hit close to home.  When I was in the market for a home last year, I found myself attracted to homes that included green features such as solar panels, high-efficiency lighting, or a pellet stove.  Now that I'm settled in, I have been debating the costs and benefits of installing solar panels. According to Greg, I'm not alone in having these thoughts, and the collective interest in green homes is having a measurable impact on the real estate market.  Without further ado:

The New Generation of Home Buyers Wants to go Green

Guest Post by Greg Geilman

There have always been trends in home buying, and the latest trend is buyers that are
demanding green homes. These buyers are focused on ways to have a smaller carbon
footprint and a lower impact on the planet. Because of their desire to have green homes,
the construction and real estate market are also being required to change. These are
markets that are often slow to change and do things differently, but they are finding that
they really do not have a choice moving forward. If sellers and builders want to attract
buyers, they have to go green as much as possible.

How Do Green Home Buyers Affect the Construction Market?

The construction market is affected by green home buyers in two different ways. The first
is simple. Builders need to create houses that will sell, and if more buyers want green
homes more builders will create them. These homes can include features such as energy
efficient windows and appliances, along with certifications for the type of lumber used
and other factors. With so many options, builders will have to pick and choose what
works for them and for their buyers.

The second way is more subtle. Builders and the overall construction market can be
affected financially, because building green homes has a different pricing structure than
building more standard homes. But whether buyers will pay more for these homes or not
affects the markup that builders receive. This can change the construction market, for
both good and bad. It forces builders to make a choice about what level of green homes
they are willing to build, as well.

What Does the Green Home Buying Movement Mean for Current Homeowners?

New construction homes that are being created by builders are not the only aspect of the
market to consider when it comes to buyers wanting green homes. It also affects the real
estate market, because sellers must consider the issue when they put their homes on the
market. Their biggest question is whether they want to make changes to their home to
make it more green before they try to sell. In most instances, whether they do this or not
will be affected by the cost of the changes that would need to be made.

Overall, anything that is energy efficient can be a good choice for a seller to consider.
Appliances, windows and doors, water heaters, and other items that reduce the amount of
power the home uses are popular with sellers who want to make changes. Buyers may
also like LED light bulbs, an automated thermostat, and apps that let them control
lighting, temperature, and other aspects of their home from other locations. Sellers will
have to decide which, if any, of these options are worth the expense in an effort to get
their home sold. The earlier these changes are made can make the difference, too. If a
homeowner makes an efficiency upgrade years in advance of selling, they reap the
rewards of saving energy over time, and making extra money on the price tag of the
home down the line.

Is This Trend Only for the Younger Generation?

The younger generation of home buyers helped kickstart this trend, but now other
generations are starting to come on board. Nearly all buyers use technology, and they are
interested in some of the ways their home can be automated, or ways they can have more
control over things like their power bill based on how much energy they consume. While
not as interested overall as younger buyers, older buyers are not shying away from green
homes, either.

One of the reasons these older buyers like green homes is because these kinds of homes
can be less expensive to operate and maintain. Once proper green systems are installed
there is little that needs to be done to maintain them over and above more standard
systems, so they can save a homeowner a lot of money over the long term. Older or
younger, buyers are starting to see the advantage to saving money and the planet at the
same time, and that is what green homes can provide them, both now and in the future –
and builders are taking notice.

National Monuments, Arctic drilling, DAPL highlight final acts of Obama administration

The Road Canyon Citadel in the 1.35 million-acre Bears Ears National Monument in southeastern Utah.  Photo: BLM.

As expected, the final "lame-duck" months of the Obama administration provided several bombshell announcements regarding American public lands and natural resources.  First, the US Army Corps of Engineers denied the permit needed to complete the Dakota Access Pipeline (DAPL).  The denial comes on the heels of the federal government's Sep 2016 announcement that it would be withdrawing the permit in order to consult with affected tribal groups.  Apparently, the consultation was effective in convincing the Corps to deny the permit (though skeptics claim the meetings were pretext for a political decision) and initiate another round of environmental review instead.  There is a good-to-very good chance that the Trump administration will instruct the Corps to issue the permit, but even if that is the case, the permit denial sets precedent for tribal consultation in a more meaningful way.  Perhaps more importantly, the victory for tribes and environmental groups will almost surely inspire and encourage more pipeline protests in the future, having been successful in blocking two consecutive high-profile pipeline projects (DAPL and Keystone XL).  

Second, the Obama administration invoked the Outer Continental Shelf Lands Act of 1953 to set aside wide swaths of the Arctic off-limits for off-shore drilling.  The American portion of the Chukchi Sea will be entirely off-limits, while most of the Beaufort Sea will be as well.  In a corresponding move, Canada declared a freeze on drilling in its portion of the Artic seas.  The OCSLA allows a President to declare portions of the continental shelf off-limits for oil and gas exploration, though up to this point presidents had put a timetable on a drilling moratorium.  Obama's declaration puts these portions of the Artic off-limits "indefinitely."  Trump has appointed notable oil and gas industry supporters to his cabinet (including the Secretaries of State and Energy, as well as the Administrator of the EPA), and it seems clear his administration will not be fond of these drilling withdrawals. But there's not much precedent to reverse a decision of this nature, or at least not unilaterally (the Republican-controlled Congress could always amend the OCSLA).  If reversed, the decision would almost surely be forced to defend itself in the federal courts.

Finally, President Obama established two new National Monuments.  The 1.35 million-acre Bears Ears National Monument in Utah, and the 300,000-acre Gold Butte National Monument in Nevada.  The Antiquities Act of 1906 authorizes the President of the United States to establish National Monuments as part of the federal public lands system.  Devil's Tower in Wyoming was the first such monument established.  Over time, the Act has been used by presidents to establish substantial areas of land as federally protected.  In total, President Obama has established 29 National Monuments, of which Bears Ears and Gold Butte are his final two.  The move was met with praise and celebration from environmentalists, and scorn and disdain from drilling/grazing interest groups.  Like the OCSLA drilling withdrawals, there is little authority for a president to reverse a National Monument designation (in fact it has never been done before).  But, with a Republican-controlled Congress, several of whom are outraged by the new monuments, there is talk of amending the Antiquities Act or repealing it altogether.  That would be a drastic move, but not altogether surprising if Congress wants to consolidate power over disposition of public lands.

All of this brings us now to the Trump Administration.  President Trump (sworn into office today) will oversee America's public lands and natural resources at a very interesting time.  Climate change continues to dominate debate and negotiations within the international community, the fracking boom is continuing apace domestically, and tensions between public vs. private land supporters remain high.  Meanwhile, with a Republican-controlled Congress and White House, the stage is set for their agenda to dictate the terms of these conflicts.  Already Congress is considering bills that would overhaul the balance of power between Congress and administrative agencies.  It is clear, however, that Obama-era activists will not be backing down from these political and legal battles.  

Presidential Transitions and the Hyperactive Administrative State

President-Elect Donald Trump.  Photo: Gage Skidmore

A couple years ago, in response to Congressional obstructionism frustrating President Obama's legislative agenda, he said the following: "I’ve got a pen and I’ve got a phone.  And I can use that pen to sign executive orders and take executive actions and administrative actions that move the ball forward."  What the President meant by that was that, even without Congressional support, the federal executive's administrative agencies are so broad in scope and powers that the President can still use administrative rules and regulations to govern the country.  This approach was the source of the Clean Power Plan, for example, which itself was a reflection of the administration's commitment to the Paris Climate Treaty it had negotiated with the international community.

At the end of a President's term, and especially when the president-elect is of a different party from the incumbent, there is a sense that there is little work left to be done, or little that can be done.  The "lame-duck" President merely waits out the 6 weeks or so until the inauguration.  Since the rise of the administrative state in the twentieth century, however, that is anything but accurate.  In fact, the past few presidential transitions have seen Presidents continue to create new rules and regulations, often up until their last day in office.  That's because administrative agency rule-making, while technically reversible by the next administration, is in reality difficult to overturn.  Even when rules are reversed or abolished, the process requires considerable human and political investments to pull off.  

A prime example of this was President Clinton's Roadless Rule.  The Roadless Rule prevented logging, mining, drilling, and road-building across millions of acres of undeveloped national forest lands.  The Rule was published a week before President Bush took office.  The Bush administration delayed its enactment, and were not in support of enforcing it.  Overturning the rule would have required a lengthy administrative rule-making process, however, something the administration did not have the stomach for at the time.  The fight then moved to the federal courts, state governments, and the US Congress, as forces battled to preserve, modify, or abolish the Rule.  Eventually efforts to overturn the rule died in front of the DC District Court in 2013, twelve years after the Rule's enactment.  While not all administrative rules and regulations experience such a colorful history, the Roadless Rule demonstrates that a President's powers to set policy for the country do not end on election day.

Next semester I will be teaching Administrative Law.  From an educational point of view, it will be one of the most exciting times in recent history to teach this course.  The Obama administration will be announcing and promulgating hundreds of new rules up until the inauguration, and soon thereafter the Trump administration will do its best to undo or minimize the impact of those new rules.  Some of that has already begun.  A couple weeks ago the Department of the Interior announced a 5-year plan for offshore drilling in the Arctic, prohibiting oil and gas development entirely in most areas.  The Trump administration, which appears to be more friendly towards oil and gas interests, could overturn this plan only after extensive environmental studies and consultations.  

Also of interest will be the Obama administration's handling of the Dakota Access Pipeline, and the Trump administration's approach to that pipeline as well as Keystone XL.  The DAPL permits are still withdrawn, and could be granted or revoked by the current administration.  Or, the Obama administration could kick the can down the road and let the Trump administration handle it (Trump has declared his support for construction of the pipeline).  If it wanted to, the Trump administration could revisit Keystone XL as well.  The original project was denied, but a slightly modified project could be submitted again by TransCanada.  It would take some time to go through the administrative review process, of course, but it would not be surprising if Keystone XL is back on the table next year.  There will surely be more administrative agency drama to come in the next several weeks and months.  

What can the Dakota Pipeline protests tell us about existing tribal consultation requirements?

Sacred Stone Camp, North Dakota.  Photo: Joe Brusky

When the federal government announced in September that it would be withdrawing permits issued for the Dakota Access Pipeline, it was a huge win for Indian tribes and environmentalists who were protesting the construction of the pipeline across sacred sites and sensitive ecosystems.  But the government's announcement also called for a revision to federal policy as it concerns tribal consultation.  Specifically, the government requested feedback and dialogue on two questions:

(1) Within the existing statutory framework, what should the federal government do to better ensure meaningful tribal input into infrastructure-related reviews and decisions and the protection of tribal lands, resources, and treaty rights?  

(2) Should new legislation be proposed to Congress to alter that statutory framework and promote those goals?

These are fairly open-ended questions, and its fair to wonder if the administration will have enough time to consider responses, formulate a policy response, and implement it in time for this process to have a meaningful impact before the administration change-over in January.  Nonetheless, both questions merit some thought.  I'll tackle the first question in this post.  

Before thinking about how consultation can be improved within the existing framework, we need to know what the existing framework is. There are several statutes that require consultation before proceeding with certain government actions. Here are the most prominent:

The National Historic Preservation Act (which was the consultation statute at issue when the Standing Rock Sioux sued to block the Dakota pipeline from moving forward) requires consultation with tribes that attach religious and cultural significance with certain lands and properties.

The Archaeological Resources Protection Act requires consultation before the government can permit archaeological excavation on tribal lands.

The American Indian Religious Freedom Act provides tribes with access to sacred sites and objects, and allows them to conduct traditional rites.  

The Native American Graves Protection and Repatriation Act requires consultation with tribes regarding the treatment and disposition of human remains and sacred objects.

In addition to these statutes, federal agencies are bound by Executive Order 13175, "Consultation and Coordination with Indian Tribal Governments."  The Executive Order was established in 2000 "in order to establish regular and meaningful consultation and collaboration with tribal officials in the development of Federal policies that have tribal implications."  In 2009, President Obama directed federal agencies to develop a plan of action to implement the directives of EO 13175.  The Department of the Interior's plan can be seen here, for example.  

Many of these consultation statutes, regulations, and policies are fairly open-minded and receptive to consultation best practices.  The Department of the Interior's policy, for example, calls for consultation reporting and training, regular meetings with tribes, the appointment of tribal officers within the agency and sub-agencies, and opportunities for tribal consultations and dialogue throughout the administrative rule-making process.  Other agencies have similar policies and procedures (see the Department of Transportation's policy here).  

So it seems there are numerous avenues for tribal consultation on federal agency actions.  There are a number of statutory directives, as well as tailored tribal consultation plans for each agency.  Why then, is tribal consultation still challenging?  

One reason is that there is ambiguity with respect to which actions "trigger" consultation.  It is obvious that the US Army Corps of Engineers will consult with a tribe if a dam the Corps is operating will be modified in a way that will flood tribal land.  But what if water levels in a reservoir operated by the Corps are modified in a way that may negatively impact salmon, a species fished by a local tribe?  Would that type of activity trigger consultation?  It's not always clear.  And because agency rule-making or government operations often require multiple layers of bureaucracy and approvals, agencies may be tempted to err on the side of expediency rather than consultation. 

An additional challenge is that there are no uniform standards for what constitutes satisfactory consultation.  Often consultation may consist of an invitation to submit comments on a proposed agency action.  Hardly the round-table dialogue many envision when they think of consultation.  The agencies have to balance their duty to consult with the demands on their time and resources; they seek to satisfy their obligations while moving the ball forward.  

Finally, the requirement to consult typically does not carry with it any obligations to undertake any particular final decision or agency action.  For example, while the National Historic Preservation Act requires extensive consultation, ultimately it does not mandate that the permitting agency in question take any particular measures to protect historic resources.  

When the Standing Rock Sioux Tribe sued to block construction of the Dakota Access Pipeline, it claimed that the Army Corps of Engineers had not fulfilled its National Historic Preservation Act obligations because the Corps had not executed a "programmatic agreement" with tribal representatives.  A programmatic agreement is an agreement negotiated with the tribes that governs an agency's actions over a particular activity, so as to reduce impacts on sensitive resources.  The District Court's opinion noted that the Corps had executed such agreements in the past, but its failure to execute one for the Dakota Access Pipeline was not a problem because programmatic agreements are not mandatory.

These issues are not easily remedied, but lessons learned from the Dakota Access Pipeline and other cases, as well as similar provisions and procedural requirements of other statutes, can shed light on some potential fixes to federal-tribal consultation requirements.  My thoughts on those fixes are forthcoming.  

Federal Pipeline Policy pivots toward tribal and environmental interests

Sacred Stone Camp in North Dakota and the Standing Rock Sioux Reservation have become the staging area for protests along the proposed Dakota Access Pipeline route.  Photo: Joe Brusky.

Last November, the Obama Administration denied federal approval of the Keystone XL pipeline, finding that approval of the pipeline was not in the US' interests.  It largely did so because Keystone XL had become THE symbol of environmental resistance.  Previously, energy infrastructure projects had not been particularly controversial.  Even Keystone XL's impacts (both environmental and economic) were overblown by vehement opponents and supporters of the project.  I wrote then that the federal government's rejection signaled a pivot toward environmental protection, especially as the timing of the rejection came just before world leaders met in Paris to negotiate a major climate agreement.  It also represented a major victory for environmentalists, and the power of environmental protests.

The history of Keystone XL has become more salient in recent weeks, as protests over the proposed Dakota Access Pipeline (DAPL) intensified.  DAPL would carry oil from western North Dakota oil fields to an existing pipeline network in Illinois.  Along the way, however, the proposed route crosses federally controlled waterways, as well as sacred tribal lands and burial sites.  The Standing Rock Sioux Tribe, in particular, is also concerned that an oil spill might contaminate their water supplies.  But protests over the pipeline have evolved into a larger battle regarding tribal and environmental interests, on the one hand, and energy security on the other hand.  Other tribes are standing in support of the Standing Rock Sioux, as are scores of celebrities, politicians, environmentalists, and other activists.  Protests have taken place all over the country.  It is possible that these protests and shows of support for blocking the pipeline would have taken place regardless, but it seems more likely that the anti-Keystone XL movement has provided a model for citizens to use political pressure to block pipeline construction.

The legal process took an interesting turn this week, as the D.C. District Court rejected the Standing Rock Sioux Tribe's request for an injunction.  The tribe claimed that, because it was not consulted about the DAPL (as is required by the National Historic Preservation Act), construction of the pipeline would lead the tribe to suffer irreparable harm worthy of a preliminary injunction.  The court appeared sympathetic to the tribe's concerns, opening its decision thusly: "Since the founding of this nation, the United States’ relationship with the Indian tribes has been contentious and tragic."  But ultimately the standard one must meet to be granted a preliminary injunction is a very high one.  As the court noted, "'[I]njunctive relief' is 'an extraordinary remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief'" [citing Winter v. Nat. Res. Def. Advisory Council].  The tribe didn't meet that standard, according to the court, and the injunction was denied.

The legal defeat notwithstanding, pipeline protesters received a significant victory immediately after the court's decision was released.  The US Department of the Interior, Department of Justice, and Army Corps of Engineers issued a joint statement that federal approval of the DAPL would be suspended pending further review.  In addition, the federal government invited tribes and the general public to participate in consultations regarding tribal lands and resources, and the potential need for new legislation.  The joint statement calls into question the viability of the DAPL moving forward - without federal approval, the pipeline will not be able to cross major waterways blocking its path.  The statement represents a remarkable victory for tribes, environmentalists, and pipeline protestors.

This is, therefore, the second major pipeline protest breakthrough in less than one year.  One of three developments is likely true: either the federal administration is pivoting toward tribal and environmental interests, or the political pressure mounted by pipeline protestors is increasingly influential, or both.  The administration's support for tribal and environmental interests can be measured in other ways over the past few years, and that support is likely a factor in this case as well.  But the influence of protest movements in shaping energy politics is undoubtedly a major factor as well.  As mentioned, these types of infrastructure projects rarely took center stage in the past.  Now, they are doing so with regularity.  It will be interesting to see how the DAPL legal and political processes play out.  It will also be interesting to see if more pipeline protests emerge in the near future.  If the Keystone XL and Dakota Access Pipelines are any indication, high-profile pipeline protests may become the new normal.  

Solar Energy Politics: Texas and Florida are on Divergent Paths

Solar panels near San Antonio, Texas form one of the largest solar farms in the United States. Photo: BlueWing.

This November, Floridians will vote to approve an amendment to the constitution called the "Rights of Electricity Consumers Regarding Solar Energy Choice."  It was one of two solar-related ballot initiatives vying to make it onto the ballot.  The other initiative would have made it easier for third parties to finance solar panel installations, paving the way for Florida to tap into its considerable solar energy potential.  Unfortunately, the initiative didn't receive enough signatures.  The initiative that did make it onto the ballot makes it harder to finance solar installations, a fact that didn't get past Florida Supreme Court Justice Barbara Pariente.  She wrote:

"Masquerading as a pro-solar energy initiative, this proposed constitutional amendment, supported by some of Florida's major investor-owned electric utility companies, actually seeks to constitutionalize the status quo," Pariente wrote. "This ballot initiative is the proverbial 'wolf in sheep's clothing.'"

I wrote about these competing ballot initiatives in November 2015, noting that third-party financing receives political support from both liberal and conservative organizations:

"It is very frustrating to see how special interests affect politics," he said. "I'm a Republican solar contractor and I'm frustrated with my party in this state for taking donations that do not allow for competition and free market."

So it seems unlikely that Florida will tap into its solar potential (third in the country) anytime soon.  Contrast that with Texas, another state with enormous solar potential.  As John Hall points out, Texas is rapidly expanding its solar energy production:

• Texas solar is growing very quickly: The new Solar Market Insight report declares Texas to be the fastest growing utility-scale solar market in the country. In fact, by the end of 2016, SEIA predicts the state’s total installed solar capacity will more than double. And within the next five years, Texas’ solar market will be second only to California’s (although, considering California has one-fourth of the solar power potential of Texas, we could eclipse the Golden State in coming years).

• Solar will make up nearly all of Texas’ new power capacity: The Electric Reliability Council of Texas (ERCOT), the grid operator for nearly 90 percent of the state, evaluated the state’s 2031 electricity needs in eight potential scenarios based on trends and forecasts. For example, one scenario is the continuation of low natural gas prices and another reflects high economic growth. Solar was the common denominator in all eight of the scenarios: This clean energy resource represented nearly all of the new capacity in each one. In other words, the grid operator predicts that – in all foreseeable future circumstances — a lot more solar is coming online in the state. 

• Texans agree on solar: A recent poll from the Texas Clean Energy Coalition found an overwhelming majority — 85 percent — of the state’s voters want to increase the use of clean energy (including solar) to generate electricity. Even better, both sides of the aisle are on board: That group included 78 percent of Republican respondents.

More and more states (partisanship aside) are embracing solar energy and tapping into their potential.  At the moment, solar energy cannot be relied on to provide the entirety of a state's electricity needs, of course, but solar is a worthy component of any state's energy portfolio.  Texas appears to recognize that.  Florida - the Sunshine State - has work to do to catch up.  

Incremental environmental peacebuilding between the US and Cuba

The Malecon in Havana.  Photo: Guillaume Baviere.

It's been a while since I wrote about Cuba's natural resources, and their importance in thawing US-Cuba tensions.  Two posts last year highlighted the need for more cooperation between the US and Cuba with respect to offshore resources, particularly oil and gas development.  I wrote this in May 2015:

An oil spill off the northwestern coast of Cuba would hit Florida within 6 to 8 days.  And yet, Cuba and the United States don't have a bilateral agreement in place to deal with that scenario.  The US and Mexico have a bilateral agreement that regulates oil and gas development in the Gulf of Mexico, establishing safety standards, emergency protocols, and inspection procedures.  A similar agreement is needed to protect the Florida straits.

Late last year there was some noise about opening offshore exploration, and further calls for cooperation.  That led to a "joint statement" between the US and Cuba in November, calling for more cooperation on environmental issues, including objectives such as:

• protection of coastal and marine ecosystems
• protection of biodiversity
• climate change mitigation and adaptation
• regulation of energy development and oil spill preparedness
• academic exchange and information sharing

There's been little evidence of breakthrough progress on these points, but slow and steady advancements are to be expected given the many issues (environmental and otherwise) to be worked out for the first time.  In early July of this year US and Cuban officials met to discuss marine protection and biodiversity. The outcome of the talks was rather vague, and appeared not to focus on oil spill prevention and preparedness, a major area of need.  Still, the talks signal an intent to move forward with bilateral agreements and initiatives, a positive sign that environmental challenges remain high on the peacebuilding agenda.  

How those talks will move forward under a new Presidential administration remains to be seen, but at least one other objective from the joint statement - academic exchange - does appear to be moving forward.  Universities are increasingly in contact with one another, and US federal agencies are sponsoring high-level meetings of scientific and policy experts on environmental issues.  Some of these meetings may take place at or with the participation of my FIU colleagues, something that wasn't possible for us (or other Florida state university academics) until last year.  

Big Cypress: Oil and Gas Rights and Multiple Use in the National Park System

Big Cypress.  Photo: Franco Tobias.

Last semester I taught Natural Resources Law for the first time.  Some of the themes we encountered throughout the course included: the federal government's constitutional authority over public lands, the National Park Service's dual mandate to promote conservation and enjoyment of NPS lands, "multiple use" principles, tribal natural resources, wilderness designation, federal energy policy, oil and gas exploration and development, environmental review requirements, and designation of critical habitat for endangered species.  As if tailor made as a law school exam hypothetical, controversial management of the Big Cypress national preserve in South Florida invokes each of these themes.

National Parks Traveler has an excellent rundown of the preserve's troubled past.  A recent decision from the NPS to forego an Environmental Impact Statement in favor of an Environmental Assessment (or more simply, to forego more rigorous environmental impacts review) will allow Collier Resources (owner of oil and gas rights in the preserve) to study the preserve area to determine if oil and gas development is feasible.  The decision is reigniting concerns over many dormant ambiguities in the preserve's enabling legislation and management history.   Consider just a few of these ambiguities:

• the Big Cypress National Preserve is part of the National Park System and thus its ecological integrity must be maintained, but its enabling legislation provides for some oil and gas development;
• NPS management of the preserve has, at times, appeared to promote the principle of "multiple use" of public lands (allowing for extensive Off-Road Vehicle use for example), even though the principle does not apply to NPS lands;
• when the federal government acquired the lands that now make up the preserve, subsurface mineral values may have been taken into account when Collier Resources was paid for surface lands; 
• Assuming Collier's mineral rights are secure, it is unclear if meaningful energy deposits are located in the preserve, making it difficult to valuate Collier's property interests in advance of a potential buy-out;
• there are several endangered species living in the preserve - such as the Florida panther - but critical habitat has never been designated
• federally recognized tribes retain certain use rights in the natural resources of the preserve
• as a vast wilderness expanse, the preserve is an obvious candidate for designation as a federally protected wilderness area, but park officials disagree on which lands should be designated as wilderness and which lands should not;

If the seismic testing and exploration moves forward as anticipated, at least one of these issues will be cleared up, as Collier and the NPS will have a better sense of how much oil and gas is located in the preserve.  Historically Florida has not been an oil-rich state, so there's a good chance the exploration phase comes up empty.  If that's the case, a buy-out of the mineral rights would be more feasible.  If, on the other hand, Collier finds extraction worthwhile, the company will still face a difficult road.  Collier will have to submit an oil and gas development plan to the NPS for approval.  At that point, a full-blown Environmental Impact Statement is likely, and the fragility of the preserve's ecological resources might limit the extent of development.  The low cost of oil might make such a complex extraction scheme financially impracticable even if the plan is approved and survives third-party litigation.  In any case, potential oil and gas development in a national preserve (and potential wilderness area) is something to keep an eye on.  If nothing else, it makes for a great case study for students of natural resources law.

Was the President's Keystone XL rejection constitutional?

An oil pipeline near the Copper River in Alaska.  Photo: Luke Jones.

In the run-up to the COP 21 Climate Conference, US energy politics was dominated by President Obama's rejection of TransCanada's proposed Keystone XL pipeline.  The pipeline would have extended and modified the route of the existing Keystone pipeline, facilitating the extraction of Canadian tar sands oil and helping bring it to market.  Before the decision was made, I wrote about the impact a rejection of the pipeline might have on COP 21 negotiations:

If the pipeline were rejected before the COP 21 negotiations, it would further cement the feeling (shared by myself and others) that the Keystone XL fight is largely a symbolic one [...] Admittedly it's hard to quantify the extent to which a rejection of Keystone XL would bolster the US position on climate change during COP 21 negotiations, but if the administration is looking to maximize its leverage with other countries, a decision on the pipeline would be a bold move.  

As it turned out, the perception that Keystone XL would contribute to global climate change was a major factor in rejecting the project.  The State Department had already concluded that other environmental impacts would be minimal (a disputed claim), and even questioned the idea that Keystone XL would have a meaningful impact on GHG emissions.  Still, it would have been difficult to push the international community towards climate action if the US President didn't appear to be taking action himself.

It's now clear that TransCanada intends to use that reasoning against the President.  In a brief filed in January in a federal district court in Houston, Texas, TransCanada alleges that the President's rejection of the pipeline was unconstitutional.  This week several states (Oklahoma, Kansas, Montana, Nebraska, South Dakota, and Texas) filed a brief in support of TransCanada's claims.  The most interesting claim is that the President lacks the constitutional authority to reject a pipeline project.  Here is the gist of the argument:

Essentially, the argument boils down to this: Congress has constitutional authority to regulate foreign and domestic commerce; Congress has not delegated that authority to the President; and to the extent that Presidents have traditionally exercised approval power in the past, none have rejected an international pipeline on the basis that it would undercut the President's bargaining power in unrelated international negotiations.

There is some merit to the claim, but of course, the issue is not as clear-cut as the brief suggests.  While Congress has not expressly delegated approval powers to the President, it has not established a statutory scheme for regulating international pipelines either.  So there is an absence of regulation, within which several Presidents have stepped in to make approvals and regulate international pipelines to some extent.  Here is Prof. James Coleman on the federal government's likely response:

President Obama’s administration will raise several counterarguments. First, it will argue that the President has inherent and unilateral constitutional authority to control the nation’s borders, so he must have some kind of ability to control international border crossings. Second, if Congress has not established any criteria for the President to use in this decision, then he is free to create his own criteria. Third, President Johnson established this process almost fifty years ago and it has been frequently used to approve pipelines so Congress has, with the passage of time, acquiesced to this process. Fourth, federal district courts have upheld the President’s unilateral decision to approve international pipelines.

The process President Johnson established was Executive Order 11423 in 1968, which allowed the President to approve international pipelines as long as they serve the national interest.  Presidents have long followed this process, and until the Keystone XL rejection, it was largely uncontroversial.  What TransCanada is arguing, however, is not just that the President doesn't have constitutional authority to approve or reject international pipeline proposals; even if they lose that point, they can argue that in this specific case, the rejection was based on the project's perceived impacts, not its actual impacts.  

A comprehensive energy policy framework does not exist, and for the most part, has never existed.  That absence results in some constitutional ambiguities, such as the one in this case.  I think it likely that the President's authority to review and approve/reject international pipelines will be upheld in federal court; cross-border pipelines are sufficiently related to foreign affairs, even if foreign and domestic commerce is implicated as well.  However, the government should expect to receive some flack for its reasoning.  In the future, pipeline decisions may be more closely based on the substantive review of the project and its direct impact on the national interest as a result of this challenge.  

Introducing 'Marijuana Agriculture Law'

Photo: Brittney

If you've been following this blog for the past few weeks, you've noticed that I've been teasing out my forthcoming article entitled "Marijuana Agriculture Law: Regulation at the Root of an Industry."  I wrote about marijuana appellations, as well as the potential for counties across the country to start adopting a marijuana ordinance.  I've been working on the article for the past few months, and I'm pleased to finally post a full draft online.  See here for access to the article.  The article will be published in the Florida Law Review sometime next year, but this draft is available immediately.  Major themes covered include the potential commoditization/consolidation of the marijuana industry, the environmental regulation of marijuana agriculture, and the administrative challenges of regulating this new industry.  Below is the introduction to the article:  

Across the United States, voters are weighing the costs and benefits of marijuana legalization.  As many as sixty marijuana legalization initiatives may appear on election ballots in 2016, legalizing the recreational or medicinal use of marijuana in as many as 17 states and adding to the growing number of states that have already legalized marijuana.  As states move toward legalization, governments will need to address a broad range of regulatory issues, including the distribution, sale, and consumption phases of the supply chain.  But legal marijuana’s track record so far suggests that the agricultural component of the marijuana industry is being ignored.  Whether states are failing to appreciate marijuana’s agricultural roots or choosing to disregard them, the industry’s direction will be out of state control until regulatory frameworks are in place.  

Nowhere has this been more apparent than in California.  In 1996, California voters passed Proposition 215, the Compassionate Use Act (CUA).  With the CUA California became the first state to legalize the medicinal use of marijuana, exempting patients and prescribing physicians from criminal prosecution.  The text of the act was short, and did not address how the state or local governments were intended to regulate the marijuana industry.  It did not, for example, assign regulatory authority to an administrative agency, articulate limits on possession or cultivation, or propose a broad regulatory framework from which the state or local governments could operate. 

In the wake of the CUA a legal medical marijuana industry was created in California, and the industry experienced tremendous growth, notwithstanding the absence of any meaningful state regulations.  But the CUA’s omissions prompted the state legislature to enact the Medical Marijuana Program Act (MMPA) in 2003, which, among other measures, restricted the number of plants medical marijuana patients or designated caregivers could cultivate, and assigned further regulatory authority to the Attorney General.  Even these limits, however, became legally ambiguous guidelines after the California Supreme Court ruled that the rights established by constitutional amendment Proposition 215 could not be limited by legislative act.  The upshot of these early experiments with marijuana legalization is that California’s burgeoning marijuana industry has been more or less unregulated for twenty years.

In the absence of regulation, marijuana cultivation in California has exploded, with approximately 50,000 marijuana farms accounting for 60% of all marijuana grown in the United States.  There are as many marijuana farms in Humboldt County, California, as there are wineries statewide.  And this un-checked growth in marijuana agriculture has consequences for the sustainability and potential growth of the industry.  Marijuana farming has been blamed for sucking rivers dry, poisoning soil and water resources with pesticides and rodenticides, and clearing mature forests.  Much of these criticisms are flawed, as research on the environmental impacts of marijuana farming is nascent and rarely acknowledges that farmers can grow responsibly and sustainably on private lands. 

Many farmers would welcome the security of being in compliance with state and local laws, while being distinguished from cartel operations or destructive “trespass grows” on public lands.  As it stands, farms on private property remain vulnerable to police raids and asset forfeiture laws, and are unable to take advantage of typical agricultural government services, such as crop insurance programs or pesticide-free certifications.  Because marijuana agriculture’s regulatory contours have remained ambiguous for so long, the marijuana agriculture industry has been poorly understood by states and the public.  This disconnect presents a threat to responsible management of legal marijuana markets. 

Fortunately, change is on the horizon in California.  In January 2016, the Medical Marijuana Regulation and Safety Act (MMRSA) came into effect, with ambitious proposals to create comprehensive regulations for marijuana agriculture.  The MMRSA assigns authority for various regulatory responsibilities to a variety of state agencies, including the Department of Food and Agriculture, Department of Fish and Wildlife, Department of Public Health, and the State Water Resources Control Board.  Said the author of the bill, “cultivators are going to have to comply with the same kinds of regulations that typical farmers do…it's going to be treated like an agriculture product.”  It took twenty years to get there, but marijuana cultivation has finally been recognized as an agricultural activity in California, and may now be regulated as such.

The same cannot be said for every state that has legalized, or is considering legalizing, medicinal or recreational marijuana.  In many states the immediate regulatory priority is the distribution, sale, and consumption of marijuana.  Colorado legalized recreational marijuana by passing Amendment 64: The Regulate Marijuana Like Alcohol Act of 2012.  For political and public health reasons the analogy makes sense, but it also reveals a regulatory blind spot.  States may be using alcohol as a model for regulating the distribution, retail, and consumption of marijuana, but marijuana is much more than a retail product.  It is also an agricultural product, and by some measures, the largest cash crop in the United States.  Since marijuana prohibition laws were passed long before any regulations for cultivation were developed, states are facing an unprecedented challenge: regulate, for the first time ever, one of the country’s largest agricultural industries.  

Early indications suggest that states are making little effort to regulate marijuana cultivation, or fail to appreciate the disruptive potential of marijuana agriculture.  21 states may have marijuana legalization initiatives on their ballots for the 2016 elections.  Colorado, Washington, Oregon, Alaska, and Washington DC have already legalized the medicinal and recreational use of marijuana.  But few of these states are anticipating the unique regulatory challenges that marijuana agriculture presents.  Even fewer are prepared to tackle them.

This Article argues that marijuana is a burgeoning agricultural industry, and calls for regulations that recognize it as such.  As the field of marijuana agriculture law is incipient, this article provides a roadmap for the major regulatory issues states and the industry are likely to encounter.  Many agricultural policies and programs are created or supported by the federal government, and would not apply to marijuana agricultural activities that run afoul of federal marijuana prohibition laws.  Therefore, states and the marijuana industry will need to be creative in providing analogous regulatory functions.

The most immediate choice regulators will be forced to make is between an approach that incorporates the marijuana industry into the existing regulatory framework for agriculture (essentially treating marijuana like any other agricultural product), or an approach that creates a separate regulatory framework for marijuana cultivation.  While the former has its benefits, and may be achievable long-term, marijuana’s transition from the black market may call for a targeted regulatory scheme in the interim. 

Another fundamental issue facing the marijuana agriculture industry has not yet been conclusively resolved: is marijuana an agricultural commodity?  Commodities are fungible goods with no qualitative differentiation, such as wheat or soybeans.  Many existing farmers fear that marijuana markets will be flooded with cheap, indistinct marijuana grown by “Big Ag” conglomerates.  To counteract these concerns, some industry groups are advocating for states to adopt an appellation model of marijuana cultivation that would preserve markets for regional marijuana products and maintain quality standards.  States and counties can play a large role in this existential question by adopting or rejecting the appellation model, or by enacting other regulations that facilitate or preclude the consolidation of marijuana agriculture.

There is an environmental component to marijuana agriculture that will also require regulatory attention.  Pesticides and fertilizers facilitate plant growth, but may reduce soil and water quality.  There is a market for organic or pesticide-free marijuana that states and the marijuana industry may wish to cultivate.  Marijuana agriculture also requires appropriate quantities of water for irrigation and, when grown indoors, energy resources.  Regulators must balance an interest in providing resources to a growing industry with the need to manage those resources sustainably.  

When the environment does not cooperate, the federal government has been instrumental in providing stability to the agricultural industry by regulating crop insurance and providing disaster relief.  As marijuana farmers would not be eligible for these programs, states may want to provide their own support structures.  However, it may be difficult to avoid the federal government’s institutional and legal reach, presenting federal preemption concerns.

Another question concerns power sharing: where can/should regulatory authority be placed?  Local governments may play a large role in the direction of marijuana agriculture, as states with marijuana regulations have so far been broadly permissive of counties and municipalities creating their own (often more restrictive) marijuana agriculture regulations.  Local governments can utilize their lawmaking powers to shape agricultural policy for the marijuana industry, but this decentralized nature of policy-making may come at the expense of regulatory clarity for the state as a whole.

Keeping the regulatory framework centralized on the state level provides more consistency, but may be difficult to apply in states where political support for marijuana cultivation changes drastically by jurisdiction.  In addition, states will need to decide whether to consolidate regulatory authority for marijuana into one state agency, or to assign different roles and responsibilities to several agencies and regulate cooperatively.  Colorado has adopted the former model, while California the latter.  

In February 2016, Humboldt County passed a comprehensive commercial marijuana cultivation ordinance, one of the first of its kind.  As the heart and soul of California’s marijuana agriculture sector, Humboldt County has consistently played a leadership role in the development of the marijuana industry, and this ordinance may prove instrumental in shaping marijuana agriculture policies around the country.  The ordinance addresses many of the issues identified in this article, placing limits on farm size, water, and energy use, while developing an artisanal labelling program.  The Humboldt County ordinance is an ideal case study for the nascent field of marijuana agriculture law, and underscores the need for state and local governments across the nation to start developing their own regulatory framework.   

Never before has a major agricultural product entered legal markets with the pace and scale that marijuana is entering them today.  States face an unprecedented regulatory challenge, and ignoring the agricultural dimension of the marijuana industry is not a sound long-term approach.  This article will present and analyze the most significant legal and regulatory challenges states will face when legalizing marijuana.  Responsible and sustainable marijuana agriculture can be fostered at the state level, but only if regulations are responsive to the unique and unprecedented challenges that marijuana agriculture presents.

US and Canada agree to cut methane emissions; will regulations hold up?

US President Obama and Canadian Prime Minister Trudeau greet the audience.  Photo: Pete Souza, whitehouse.gov.

When President Obama announced that the US would not be approving the Keystone XL pipeline project last November, a move that would frustrate efforts to bring crude oil from Canada to global markets, it was believed that Canadian Prime Minister Justin Trudeau's more climate-friendly politics made it easier for Obama to nix the project without damaging US-Canada relations.  The previous Prime Minister had pushed the pipeline as a national priority, while Trudeau was more circumspect in supporting the project.

It now seems climate policy might be an opportunity for collaboration between the US and Canada.  During Trudeau's visit to the White House this week, the two heads of state announced a joint plan to cut methane emissions in the oil and gas sector.  The plan calls for a 40-45 percent reduction from 2012 levels by 2025.  As the EPA administrator noted:

EPA will begin developing regulations for methane emissions from existing oil and gas sources [...] We will begin with a formal process to require companies operating existing oil and gas sources to provide information to assist in the development of comprehensive regulations to reduce methane emissions. An Information Collection Request (ICR) will allow us to gather information on existing sources of methane emissions, technologies to reduce those emissions and the costs of those technologies in the production, gathering, processing, and transmission and storage segments of the oil and gas sector.

Unfortunately, developing regulations of this nature take time, and even if the administration manages to complete the rule-making process by the time President Obama leaves office, actual implementation and enforcement of any new rules would be undertaken by the next President.  Unfortunately, several of the remaining candidates for president are not proactive when it comes to climate policy, and are unlikely to meaningfully enforce these rules.  They may even be prompted to develop their own rules for the oil and gas sector that disregard methane emissions.

The NYT's Andrew Revkin, for his part, is disappointed that these rules are coming so late:

McCarthy’s assertion that the leakage issue only became clear enough to act now is hard to swallow, particularly given Obama’s longstanding “all of the above” push on energy, which I supported, but only if it came with extra attention to oversight [...] Click back to our front-page 2009 report in The Times and this related Dot Earth post to see how clear the problem, and solutions, were even then.

Agency rulemaking in the closing hours of an administration's term in office is nothing new, of course, and many of those rules remain in effect despite lacking political support from the next administration.  But coupling these rules with foreign policy and the national security interest implicated by good relations between the US and Canada is a shrewd move that makes it more difficult for the next president to rescind the methane reduction pledge.  Prime Minister Trudeau will likely be in office for the next few years and is aggressively promoting his own climate policies.  Failing to hold up our end of the bargain by rescinding the methane regulations or failing to enforce them would not be the best way for the next president to start building a relationship with Canada.

Supreme Shocker: court orders stay of Clean Power Plan

Courtroom of the United States Supreme Court.  Photo: John Marino.

In a move virtually no one saw coming, the United States Supreme Court ordered a stay of the Environmental Protection Agency's Clean Power Plan pending review by the DC Circuit court.  The Clean Power Plan requires states to reduce greenhouse gas emissions by regulating emissions from electricity producers such as coal plants.  The DC Circuit is hearing the case to decide on its constitutional validity.

While the constitutionality of the Clean Power Plan had been questioned and debated by observers, it is highly unusual for the Court to insert itself into a pending case of a lower court in this way.  The DC Circuit had scheduled review of the CPP according to a timeline that would allow for a decision before any major action by the states, so few were expecting the Supreme Court to intervene and put a hold on the CPP in such urgent fashion.  Here's Patrick Parenteau on how odd the order is:

This action is unprecedented in a number of ways. The majority made none of the findings typically required to obtain a stay. There is no analysis of the merits of any of petitioners’ claims. There is no showing that the rule threatens any immediate harm to petitioners, especially given the long lead times EPA has built into the process. There is no showing that the balance of hardships tips decidedly in favor of the petitioners, especially given the fact that most states are well into the process of developing implementation plans and those that do not want to submit a plan don’t have to. There is no showing that the stay is in the public interest, especially given the warnings from the scientific community that time is fast running out to avoid catastrophic consequences of climate disruption. Never before has the Court interjected itself in a case with such high stakes that hasn’t even been fully briefed and argued before the lower court.

This is what the Court's order looks like: 

The order isn't a final decision invalidating the CPP, but it does create uncertainty for states who were developing plans to comply.  And it suggests that the five justices in favor of the stay may eventually overturn the plan.  Some have suggested the Court believes the EPA needs a more express authorization from Congress to implement such sweeping regulations.  If that's the case, it will deal a severe blow to the United States' chances to meet the climate commitments we signed onto in the Paris Climate Agreement.  Many states are leading the way on climate change mitigation, but the CPP was a key tool in requiring regulation in all states.  At the very least, the order ensures there will be a lot of attention on the DC Circuit as it hears the case and renders its opinion.  

Indoor agriculture's future: bright or blight?

Photo: Phil Hendley

Indoor agriculture - growing food in greenhouses instead of in an outdoor field - is nothing new.  Roman gardeners used a greenhouse-type system to provide cucumbers to the Emperor Tiberius every day of the year.   Today greenhouses cover 0.25% of the Netherlands' total area.  But two recent developments are making agronomists and the private sector look at indoor agriculture on a larger systemic scale. The first is that climate change is wreaking havoc on traditional agricultural areas.  California, for example, grows most of the United States supply of produce, but now faces a recurring lack of water to irrigate those crops.  Indoor agriculture can grow produce any time of the year, virtually anywhere:

In an indoor farm, water doesn’t inconveniently evaporate. LED lights can lengthen the hours of sunlight so plants can grow faster. CO2 levels can be tweaked. Even as the weather outside goes haywire, plants farmed indoors can live out an optimized version of the weather that they coevolved with — the weather of the past. The best weather of the past. 

The second development is an advancement in greenhouse technology and software that monitors plants and growing conditions and adjusts those conditions to reach that optimized environment.  Importantly, these technological advances can mitigate the two major downsides of indoor agriculture: cost and energy.  Outdoor crops use sunlight and rain, so replicating that process makes indoor agricultural products more expensive.  And the massive amounts of electricity required to mimic the sun and pump water into the system dramatically increases the energy footprint of an already carbon-intensive industry.  

Agricultural start-ups are working on these inefficiencies and looking at ways to make indoor agriculture more sustainable (e.g. incorporating solar powered electricity sources).  But, as promising as indoor agriculture might seem, it will be some time until the energy demands are reduced to the point of sustainability.  Indoor agriculture can contribute to food security by ensuring stability in the supply chain, but the most resilient and sustainable food system grows crops at the time, place, and location where they are best suited.  If California isn't a suitable place to grow arugula anymore, it's likely there is a region somewhere else that is.  

Perpetuating agriculture in unsuitable locations, or deciding to replicate natural processes indoors, is partly a by-product of negative externalities and the difficulty in pricing resources like water and electricity to reflect their true cost.   Agricultural policies can make this more difficult as well, providing subsidies to traditional agricultural regions or placing zoning restrictions on lands with potential to support agriculture.  In the face of these barriers to agricultural mobility it's not surprising that market disrupters are enthusiastic about indoor agriculture, but let's not forget that policy changes in the agricultural sector can make a big difference in the resilience and efficiency of the food system.  The sun and the rain still have a role to play.

Greenhouses in the Netherlands.  Photo: Pieter Edelman

Photo: Sint -Katelijne-Wave

Supreme Court ruling preserves (and explains) electricity demand response programs

Image by Good Energy

The Supreme Court issued a ruling this week that hasn't dominated the news cycle, but will have a profound impact on the way electricity markets operate.  In Federal Energy Regulatory Commission v. Electric Power Supply Association, the Supreme Court upheld a Federal Energy Regulatory Commission (FERC) rule that required electricity operators to compensate demand reductions at the same rate as supplied electricity.  In other words, if you can manipulate the demand for electricity by communicating with consumers and asking for voluntary energy reductions during peak demand periods, every megawatt of avoided electricity will be compensated at the same price as a megawatt of supplied electricity.  

These manipulations are called demand response programs, and they provide benefits across the market.  Major consumers get paid to reduce their energy consumption during peak demand periods, utilities reduce their reliance on the most expensive energy sources, the likelihood of power outages goes down, and consumers benefit from lower prices of wholesale power.  And of course, a reduction in energy consumption is a win for the environment.  The only real losers are energy producers, such as the Electric Power Supply Association.  [David Roberts has a nice rundown of the history of demand response and this case.]

The EPSA contention was that FERC didn't have the authority to issue the rule because regulating retail electricity is a power reserved to the states.  The Court disagreed on the grounds that the Federal Power Act gives FERC the authority to regulate not only wholesale power rates, but also any practices affecting wholesale power rates.  Demand response directly affects wholesale power rates in obvious ways, so the Court ruled that FERC has the authority to create the rule.  The ruling preserves the existence and growth of demand response programs.

But as Matthew Christiansen notes, the Court went even further by finding that regulation of demand response is unambiguously within FERC's authority.  That means FERC won't be able to dismantle demand response programs in the future by reinterpreting its position that it has jurisdiction to regulate them (something a future FERC administration might want to do).  It could do so on substantive policy grounds, but at this point all the evidence on demand response programs supports their continued existence, so a substantive reversal would be tough to justify.

The Court's opinion, which is surprisingly clear in its explanation of demand response programs, can be seen here.

Will frackers be held liable for inducing earthquakes in Oklahoma?

A flare releases pressure from a natural gas fracking well in Oklahoma.  Photo: Joshua Pribanic.

Five years ago, before hydraulic fracturing became a common method to extract natural gas, Oklahoma recorded only three magnitude three earthquakes.  In 2015, Oklahoma recorded 907.  2016 is off to another record-breaking start: last week two earthquakes (magnitude 4.7 and 4.8) struck northern Oklahoma, where fracking dominates.  It's hard to predict if a larger earthquake will rock the state, but these recent quakes suggest that may be likely:

“I do think there’s a really strong chance that Oklahoma will receive some strong shaking,” said Daniel McNamara, a research geophysicist at the National Earthquake Information Center in Colorado, who has followed the state’s quakes.  Referring to the shocks that occurred Wednesday night, he added, “I’m surprised it didn’t rupture into a larger event.”

Most experts believe the drastic increase in earthquake incidence is the result of forcing fracking wastewater into the ground.  While that process is effective in disposing of fracking waste, it also disturbs fault lines.  In some cases, especially in Oklahoma, these disturbances become earthquakes.  

But while the science is clear to some in a broad "A is causing B" sense (fracking is causing earthquakes), the more specific causal connection between a particular fracking operator's activities causing damage to people or property is less clear.  It would be hard for a homeowner whose property has been damaged from an earthquake to present a strong scientific case that the earthquake was caused by a discrete defendant in order to assign liability and claim damages.   Some cases are already popping up, and in most of these property owners are suing a bundle of oil and gas companies in the hopes that they will be collectively responsible.  In regions where more than one company is injecting wastewater underground, that may be the strongest approach, but it dilutes the causal connection.

An added difficulty in these cases is the reality that, in most states, injecting water into the ground is illegal or negligent behavior.  In Oklahoma, neither the state legislature or the governor have taken any meaningful action to curb fracking activities.  Only the Oklahoma Corporation Commission has been assigned to propose restraints, and it has limited regulatory powers:

With no explicit authority to regulate seismic issues, the commission has persuaded producers to voluntarily follow a series of ever-stricter directives on waste disposal in earthquake zones. But while those orders appear to have curtailed earthquakes in some areas, the overall number has continued to soar.  Last month, a financially troubled producer in the northern oil and gas fields struck by Wednesday’s quakes, SandRidge Energy Incorporated, broke industry ranks and refused the commission’s request to scale back its underground waste disposal.

Professor Blake Watson (Dayton) believes courts should impose strict liability on fracking producers on the grounds that groundwater injection is inherently dangerous - a finding that would eliminate the need to show that producers were negligent in their activities.  The downside is that courts aren't the ideal branch of government to sift through scientific studies emerging in real-time and impose liability after-the-fact.  Ideally a strong administrative agency would do so.  In many cases they have proved effective:

In recent years, other states with oil and gas exploration have also seen an unusual number of earthquakes. State authorities quickly suspected that the earthquakes were linked to disposal wells. In Youngstown, Ohio, in 2011, after dozens of smaller quakes culminated in a 4.0, a nearby disposal well was shut down, and the earthquakes stopped. Around the same time, in Arkansas, a series of earthquakes associated with four disposal wells in the Fayetteville Shale led to a ban on disposal wells near related faults. Earthquakes were also noted in Colorado, Kansas, and Texas. There, too, relevant disposal wells were shut down or the volume of fluid injected was reduced and the earthquakes abated.

Absent a strong regulatory agency, though, property owners may have no other recourse than to pursue compensation through litigation, however challenging causation arguments may prove to be.  If Oklahoma's agencies continue to meekly regulate fracking activities and wastewater injection, we'll soon find out how the courts address induced-earthquake liability.

COP 21: 5 Thoughts on the Final Draft

A replica of the Eiffel Tower made from bistro chairs stands at the COP 21 conference venue.  Photo: Ryan Stoa.

The COP 21 Final Draft of the Paris Agreement has been released (see here for the text).  After months of preparations and weeks of negotiations, the text concludes the drafting phase of the agreement.  It's been fun following the ups and downs of COP 21, and a special thanks goes out to the Centre International de Droit Comparé de l'Environnement and FIU's College of Law, Sea Level Rise Solutions Center, and Institute for Water and the Environment for inviting me to the conference and allowing me to participate.  The process (and blogging!) isn't over, as countries now need to ratify the agreement through their own domestic political processes, and of course, the agreement needs to be, you know, implemented.  But for the moment we can step back and take stock of what the Paris Agreement means for international climate action.  5 thoughts:

The mood in Paris is optimistic

It's been a while since an international climate conference concluded on good terms.  The last major effort in Copenhagen was panned as a failure, breeding cynicism that a climate deal could ever be reached.  While the Paris Agreement has its faults (see below), it at least succeeded in bringing countries together to get started (if belatedly) on this business of climate change mitigation.  The conference birthed the "high-ambition coalition" which includes both poor and rich nations, and many of the world's biggest polluters were enthusiastic about ambitious mitigation targets:

One of the most unexpected developments in Paris is the biggest polluters coming around to the idea of setting an even more ambitious target of 1.5 degree. Canada, Australia, European countries, China, and the United States have all spoken in favor of recognizing the damage above 1.5 degrees.

The final text adopted the less ambitious goal of limiting warming to 2 degrees, but nonetheless, it's encouraging that on a philosophical level countries are realizing that climate change must be addressed.  Now they can decide how.

5-Year Reviews are In

I wrote at the outset of the conference that there was some consensus forming around the idea that countries' emissions (and progress in meeting emissions reductions) would be reviewed every five years.  That would allow the international community to monitor progress (and laggards) while providing a basis to adjust emissions reduction targets if climate science paints an increasingly bleak picture.  5-Year Reviews ended up being much more contentious than expected, as China pushed for more ambiguous reporting requirements.  The United States pushed hard to keep the 5-Year Reviews in the agreement, and in the end they were successful.  Based on its negotiating stance, the US should expect to lead the review effort, providing financial and technical assistance to developing countries to conduct the reviews.  The Reviews will begin in 2019.

Decarbonisation is Out (more or less)

One of the more ambitious goals of previous drafts of the agreement was complete decarbonisation by 2050.  In other words, to produce 100% of energy through renewable sources within 25 years.  It was always a bit of a reach, but the fact that decarbonisation was a talking point and negotiating item at all was surprising to some.  The final draft only calls for carbon neutrality (no net increase in carbon emissions) sometime in the second half of this century.  A far cry from decarbonisation by 2050.

Climate Finance tabled for now

The most divisive issue at COP 21 may have been the differentiation in responsibilities between rich and poor countries.  I wrote about this on Tuesday, particularly the "loss and damage" provisions that developing countries were desperate to include.  "Loss and Damage" provisions are in the final draft, but lack any meaningful obligations.  In fact, the preamble specifically interprets the loss and damage provisions of the text to not "provide a basis for any liability or compensation."  In other good news for rich countries, the financial obligations can was kicked down the road.  The previous commitment to provide 100 billion USD was maintained as a floor, while an increase in that amount was tabled until 2025.  A short-term win for developed countries, but one that doesn't resolve the underlying tensions between rich and poor countries when it comes to climate change.

The scope of the Paris Agreement was appropriately narrow

Anytime an environmental issue makes it onto the international agenda in a high-profile way, there's a temptation to piggy-back by making the issue a proxy for every other environmental issue.  Technically it's pretty easy to do, as environmental challenges are so intertwined that addressing one can be reasonably argued to be a prerequisite for addressing another.  And so it was at COP 21, where many were campaigning hard for the climate agreement to meaningfully address the role of women, indigenous groups, management of the oceans, and a host of other climate-related problems.  I spoke at an event on Thursday that was focused on human rights and climate change, and most of my co-panelists spoke with disappointment that the text was unlikely to address human rights.  These focus issue groups will be disappointed that the final draft does little (if anything) to address their core concerns.  Unfortunately, that probably wasn't realistic in the first place.  It was hard enough for negotiators to agree to a text that was narrowly focused on carbon emissions.  In fact, the conference went longer than expected in order to get it done.  Climate change does implicate countless other environmental challenges, but to add them all to the agenda would have precluded agreement on a more focused topic.  Many groups will be disappointed by the final draft, and they are right to continue pushing for progress, but at its core the Paris Agreement was about carbon emissions.  That other related issues were dropped along the way shouldn't detract from the fact that for the first time the international community has a meaningful framework from which to continue addressing climate change.

The Climate Generations area of COP 21 near the end of the conference. Photo: Ryan Stoa.

The Politics of Solar Energy in Florida

Rooftop solar in San Marco Island, Florida.  Image: Tai Viinikka

The Sunshine State, perhaps unsurprisingly, ranks third in the nation in rooftop solar potential.  It ranks first among states east of the Mississippi.  And yet Florida ranks a middling 14th in the nation in solar capacity installed.  What gives?  For one thing, Florida doesn't have a renewable energy standard (RES).  RESs require utility companies to source a certain percentage of their energy portfolio from renewable sources.  More than half of states have an RES of some kind.  

Also problematic are legislative barriers to rooftop solar installation.  If you're a Florida homeowner, you are free to purchase and install solar panels on your property.  But Florida doesn't allow third parties to provide those panels for you.  Landlords, for example, can't install panels for their tenants, and third party solar providers can't absorb the up-front cost of installation in exchange for monthly payments (often less than utility bills) from a homeowner.  The only entity that can sell power in Florida is a regulated utility company.  As this map shows, that makes Florida unique, one of only four states (Georgia recently authorized third-party solar) that prohibit third party solar:

Image: DSIRE

The anti-solar climate in Florida is fostering opposition from the usual suspects, including the Southern Alliance for Clean Energy.  It's also creating a partnership between environmentalists and the Tea Party:

Debbie Dooley agrees that change is inevitable and may be coming sooner than many have expected. She is the president of the Green Tea Coalition and Conservatives for Energy Freedom, part of a growing movement among political conservatives who are advocating for solar across the country.

Bills have been awaiting passage "for years," she said, "and they have all stalled in committee. Now we are taking the message straight to the people, giving Floridians the right to decide for themselves."

Other conservatives are likewise frustrated by the rigidity of the state's solar rules:

"It is very frustrating to see how special interests affect politics," he said. "I'm a Republican solar contractor and I'm frustrated with my party in this state for taking donations that do not allow for competition and free market."

The groups are pushing for a constitutional amendment to be placed on the ballot in 2016, which would remove barriers to third party solar installation.  In response, utility companies have started their own solar campaign:

Opponents have started a committee and constitutional amendment of their own: Consumers for Smart Solar, which aims to protect the existing rules around solar power. The Florida Chamber of Commerce — whose board of directors includes executives from five power companies — is a supporter.

Utilities are right to point out that regulation is needed in the energy sector to ensure that energy provision and consumption is safe and reliable.  But there's likely a less extreme option available to the legislature than a blanket prohibition on third party solar.  We'll find out in November 2016 if Florida voters agree.

The American West is Diversifying its Energy Portfolio

Image: ACORE

The American Council on Renewable Energy's 2015 report on western energy markets makes a convincing case that states in the American West are increasingly reliant on renewable energy sources.  Per the graphic shown above, the 13 western states accounted for half of the nation's installed renewable energy capacity, and half of the nation's private sector investments in renewable energy.  One factor driving the growth is the West's sheer size and renewable energy potential - the 13 western states encompass half the land area of the United States, including major river systems like the Colorado, Columbia, and Missouri, mountain ranges like the Rockies and Sierra Nevada, rainforests, volcanoes, deserts, and the Pacific coast.  The region is undeniably blessed with natural resources.

But the ACORE report also cites connectivity and inter-dependence as a major driving force behind energy diversification in the American West:

It is increasingly evident that the electric grids of western states are interdependent and complementary. To take fullest advantage of renewable supplies, fully utilize existing transmission infrastructure and manage costs to ratepayers, grid operators and regulators are looking to move towards an integrated western grid. 

Energy generation is only one side of the 'energy holy grail.'  The other is energy storage and delivery, where the energy industry would like to see more integration:

“We don’t want to do this necessarily the same way we did solar policy, where every single state in the nation has a different framework,” said Madeleine Klein of SoCore, a solar developer owned by Edison International [...]  For solar developers to operate in 50 states, Klein said, they have to navigate 50 different markets, with 50 different sets of regulations.  “We want to try to avoid that for storage, so that you’re looking at effectively the same market structure regardless of whether you’re looking at a northeast project or a southwest project.

It looks like the western states are moving towards an integrated energy framework.  The Energy Imbalance Market (EIM) aims to share renewable energy across state lines to accommodate for fluctuations in renewable energy generation and demand.  Several major utilities in California, Oregon, Washington, and Utah are already participating in the EIM, and others in Idaho and Nevada are thinking about joining up as well.  This integration might even prompt the western states to develop a regional compliance plan under the Environmental Protection Agency's Clean Power Plan requirements:

There are strong incentives for states throughout the western interconnection to cooperate on resource planning, transmission infrastructure, and development of a common emissions trading infrastructure. A regional plan would likely be more cost effective and enable states to access higher-impact and lower-cost carbon reductions in other states.

There's no question that a transition to renewable energies will be challenging (Bill Gates recently said it would take a miracle), and it will be interesting to see how the American West, with its vast natural resources and great distances between population centers, addresses the demands of energy generation, storage, and delivery.  

Keystone XL and the COP 21 Deadline, Ctd

That was fast.  President Obama announced today that his administration would not be approving TransCanada's proposal to build the Keystone XL pipeline.  The decision came two days after the administration denied TransCanada's request to delay a final decision.  And on Wednesday I wrote:

If the pipeline were rejected before the COP 21 negotiations, it would further cement the feeling (shared by myself and others) that the Keystone XL fight is largely a symbolic one [...] Admittedly it's hard to quantify the extent to which a rejection of Keystone XL would bolster the US position on climate change during COP 21 negotiations, but if the administration is looking to maximize its leverage with other countries, a decision on the pipeline would be a bold move.  

President Obama appears to share those views.  On the symbolic nature of the Keystone XL fight:

“This pipeline would neither be a silver bullet for the economy, as was promised by some, nor the express lane to climate disaster proclaimed by others”

The President was also forthcoming about the influence that COP 21 had on his decision:

Obama said the Keystone decision was important ahead of the summit to reinforce the United States’ global leadership and commitment to combating climate change. “Approving this project would have undercut that global leadership,” Obama said. “If we want to protect the worst effects of climate change before it’s too late, the time to act is now.”

The NYT also points out that US-Canada relations may have played a large role in the timing of the decision:

The recent election of a new Canadian prime minister, Justin Trudeau, may also have influenced Mr. Obama’s decision. Mr. Trudeau’s predecessor, Stephen Harper, had pushed the issue as a top priority in the relationship between the United States and Canada, personally urging Mr. Obama to approve the project. Blocking the project during the Harper administration would have bruised ties with a crucial ally. While Mr. Trudeau also supports construction of the Keystone pipeline, he has not made the issue central to Canada’s relationship with the United States, and has criticized Mr. Harper for presenting Canada’s position as an ultimatum, while not taking substantial action on climate change related to the oil sands.

Here's the full announcement:

Keystone XL and the COP 21 Deadline

A pumping station on the (existing) Keystone Pipeline System, Nebraska.  Photo: Shannon Ramos.

The proposed Keystone XL pipeline is in the news again this week, after the pipeline company (TransCanada) requested that the US State Department delay its decision to approve or reject the project.  Ostensibly TransCanada made the request on the grounds that there are outstanding siting issues to work out in Nebraska, but the more likely reason is that the company fears the Obama administration will soon issue its rejection, possibly in the run-up to the COP 21 climate negotiations in Paris.  The administration will be trying to obtain as many concrete climate commitments from other nations as possible, and a rejection of the Keystone XL pipeline would send a strong message that the US is committed to the COP 21 process.  A delay, on the other hand, would likely push the decision onto the next president (many of whom have declared support for the project).  Today the State Department announced it would not grant TransCanada's request, and suggested that a decision will be made before the president leaves office.

If the pipeline were rejected before the COP 21 negotiations, it would further cement the feeling (shared by myself and others) that the Keystone XL fight is largely a symbolic one.  Supporters trump up the job-making potential of the pipeline, but those hopes are overblown ("between 35 and millions," according to Jon Stewart), and most jobs would be short-term construction positions.  On the other hand, approving the pipeline isn't likely to be the apocalyptic death to the climate system some project, largely because the oil can find its way to global markets by other means (one pipeline being proposed would take tar sands oil from Alberta to the Pacific Ocean, across sensitive wilderness areas and First Nations lands).  

That's not to say the symbolic fight doesn't matter.  Landmark victories have been hard to come by for the environmental movement in recent years, especially when it comes to climate change.  Demonstrating the ability to defeat a large energy project supported by the oil and gas industry and many Congressional politicians would be a monumental achievement and might catalyze other organized campaigns.  And doing so at the moment when the US is trying to show leadership during COP 21 climate negotiations would amplify the impacts of that achievement.  So while rejecting the pipeline project itself may not have a significant impact on GHG emissions directly, it may have a very significant impact indirectly. 

Ultimately that may be the most relevant long-term outcome of the Keystone XL fight.  Even if the pipeline is rejected, TransCanada can resubmit its application when the next administration takes office (the costs of going through the permitting process and NEPA review are significant but not insurmountable, and there are few legal obstacles that would prevent the company from resubmitting some variation of the initial proposal).  And while many are focused on the political influences on the pipeline's destiny, the global price for oil may be just as, if not more, influential.  If oil prices stay low, new investments in oil and gas are unlikely even if Keystone XL is approved.  If prices rise TransCanada can try its luck again with the next president.  Admittedly it's hard to quantify the extent to which a rejection of Keystone XL would bolster the US position on climate change during COP 21 negotiations, but if the administration is looking to maximize its leverage with other countries, a decision on the pipeline would be a bold move.