Environmental Business Alert

Date: Oct 10, 2012

Ninth Circuit Rejects Public Nuisance Suit for Climate Change Damages

Another federal public nuisance suit alleging harm from climate change has been rejected, this time by the U.S. Court of Appeals for the Ninth Circuit. Citing U.S. Supreme Court precedent, the Ninth Circuit held in Native Village of Kivalina v. Exxon Mobil Corp. that the Clean Air Act ("CAA") preempts such tort suits seeking damages from climate change. The plaintiff, a city on the northwest coast of Alaska, sued a group of oil, energy, and utility companies, alleging that greenhouse gas ("GHG") emissions from the companies resulted in climate change that decreased arctic sea ice and caused damaging erosion. As we previously reported, the U.S. Supreme Court held in American Electric Power Co. v. Connecticut that the CAA displaces federal common law nuisance claims because Congress delegated authority to the U.S. Environmental Protection Agency ("EPA") to decide how to regulate GHG emissions from stationary sources. The September 21, 2012, Kivalina decision extended the rationale of American Electric Power, which addressed a claim for injunctive relief, to cases for damages.

House Bill to Address Renewable Fuel Program Fraud

Efforts to resolve market uncertainty following the Renewable Identification Number ("RIN") scandal reported here continued apace with a bipartisan proposal, the Stop RIN Fraud Act of 2012. The bill, introduced on September 20, 2012, by Congressmen from Texas and Utah, would require EPA to certify, or authorize accredited third parties to certify, the validity of RINs, which various market participants use to fulfill the renewable volume obligation of the Renewable Fuel Standard. EPA would issue the certification upon generation of a RIN, before it is traded in the marketplace. The proposed bill follows hearings before the House Energy and Commerce Committee that sought to investigate several large-scale RIN frauds and EPA's response to the resulting market disruption. Under the bill, which seems unlikely to pass given the election season, EPA would have to establish the third party verification system by January 1, 2013.

EPA Approves Substitutes for Ozone-Depleting Substances used in Fire Suppression and Explosion Protection Products

On September 19, 2012, the U.S. Environmental Protection Agency ("EPA") issued a direct final rule adding "Powdered Aerosol F," "Powdered Aerosol G" and "C7 Fluoroketone" to the list of acceptable substitutes for halon products at 40 C.F.R. Part 82, Subpart G. EPA evaluates substitutes for ozone-depleting substances, such as halon, as part of its Significant New Alternatives Policy ("SNAP") program, which it adopted pursuant Section 612 of the CAA. Under the rule, Powdered Aerosols F and G can be used in total flooding fire suppression systems in normally unoccupied spaces. C7 Fluoroketone may be used as a streaming agent in portable fire extinguishers in nonresidential applications. This rule will automatically become effective on December 18, 2012, unless EPA receives adverse comment or receives a request for a public hearing by October 19, 2012.

EPA Publishes Safer Chemical Ingredients List

Responding to concerns of formulators that the Design for the Environment ("DfE") Program did not provide for adequate marketing flexibility, EPA on September 18, 2012, published a "Safer Chemicals Ingredient List." Previously, cleaning product manufacturers were unable to determine acceptable ingredients under the Program. Now, formulators can search for approved ingredients that can be used to make DfE-eligible products. The list, however, has the potential to facilitate market deselection, as it identifies chemicals by functional class, name and Chemical Abstracts Service Registry Number ("CASRN"), and uses a coding system to summarize each ingredient's hazard profile and recommendations for additional data or "safer chemistry innovation." The list will eventually include fragrances but does not include chemicals for which the identity was claimed as confidential. EPA also published a notice describing changes to its Standard for Safer Cleaning Products, including modified review criteria for industrial and institutional products and requirements for colorants, polymers, and preservatives.

EPA Continues Efforts to Develop a Perchlorate National Drinking Water Standard

In comments filed ahead of a September 25, 2012, teleconference, EPA's Perchlorate Advisory Panel discussed its recommendation that EPA use a model also supported by industry to develop a maximum contaminant level goal ("MCLG"). Although "unenforceable," the MCLG is important because under the Safe Drinking Water Act ("SDWA") it sets the target EPA seeks to achieve through the enforceable maximum contaminant level ("MCL"). For perchlorate, the issue was whether to use the traditional reference dose ("RfD")-based model, or to use the physiologically-based pharmacokinetic ("PBPK") model favored by industry to establish the MCLG. The Panel also recommended ways to expand the PBPK model to better predict perchlorate's health effects within the body. Under its regulatory schedule, EPA must propose the perchlorate MCLG and MCL by February 2013. Although not bound by an advisory panel's recommendations, EPA generally follows them.