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The Oxford Handbook of International Climate Change Law edited by Carlarne, Cinnamon P; Gray, Kevin R; Tarasofsky, Richard (24th March 2016)

Part VII Regional and Country-Specific Perspectives, Ch.27 United States Climate Change Law

Michael B. Gerrard

From: The Oxford Handbook of International Climate Change Law

Edited By: Cinnamon P. Carlarne, Kevin R. Gray, Richard Tarasofsky

Natural resources — Climate change — Environmental disputes — Fisheries — Pollution — Maritime boundaries

(p. 607) Chapter 27  United States Climate Change Law

(p. 608) 1.  Introduction

the United States is the world’s largest economy and for many years it was the largest emitter of greenhouse gases (GHGs), until it was overtaken by China in around 2006 (PBL Netherlands Environmental Assessment Agency). However, a significant portion of China’s emissions are attributable to the manufacture of goods for export to the United States, Europe, and elsewhere (Worldwatch Institute, 2013). Its domestic and international climate change policies have tremendous global impact, both physically and politically.

The United States has no comprehensive statute on climate change. A sweeping climate change bill passed the House of Representatives in 2009 but died in the Senate, and the political situation is such that it now appears that it will be at least several years before Congress enacts any serious climate change legislation. Meanwhile, the federal government is utilizing old statutes, especially the Clean Air Act of 1970, to cobble together a regulatory program. States and regional groupings of states, as well as cities, are also playing important roles in formulating climate change strategies.

This chapter begins by tracing the evolution of US climate change law and policy, including the United States’ stance on international climate agreements. It will then discuss the emerging programs under the Clean Air Act, followed by other statutes. State, regional, and local efforts are covered next. Finally, the role of the courts is considered.

2.  Evolution of US Climate Change Law and Policy

Resource conservation has been an issue since the nineteenth century, but modern US environmental law burst forth in 1970. That year, President Richard Nixon signed the National Environmental Policy Act (NEPA) and the Clean Air Act (CAA), and created the US Environmental Protection Agency (EPA). Those actions were followed by, among other important statutes, the Clean Water Act (1972), the Endangered Species Act (1973), the Resource Conservation and Recovery Act (1976), the Toxic Substances Control Act (1976), and the Comprehensive Environmental Response, Compensation and Liability Act (1980). All of these laws are still on the books, albeit in somewhat amended forms. None of the original enactments or subsequent amendments envisioned climate change or directly addressed it.

(p. 609) The first US statute to mention climate change explicitly was the National Climate Program Act, signed into law by President Jimmy Carter in 1978. It launched a program to study climate change within the Department of Commerce (United States Congress, 1978). More than a decade—and the entire presidency of Ronald Reagan—passed before Congress revisited the issue at all. George H.W. Bush was inaugurated as President in 1989, and in 1990 Congress passed the Global Change Research Act, which set up a multi-agency research program on a variety of issues, including climate change (United States Congress, 1978).

The Bush administration became actively involved in the negotiations that led to the United Nations Framework Convention on Climate Change (UNFCCC) and played an important role in keeping mandatory emissions caps out of that agreement. The United States signed the UNFCCC on June 12, 1992, and the Senate ratified it on October 7, 1992. To implement one of the UNFCCC’s requirements, Congress in 1992 directed the preparation of a national inventory of GHG emissions (United States Congress, 1992).

In November 1992, Bill Clinton defeated George H.W. Bush in the national election. In the years that followed, the administration of President Clinton and Vice President Al Gore participated in the negotiations to develop agreements to implement the UNFCCC. However, in the midst of these negotiations in early 1997 the Senate, by a vote of 95-0, passed the Byrd–Hagel resolution, which said the United States should not sign any protocol to the UNFCCC unless it, among other things, required developing countries to limit or reduce their GHG emissions within the same compliance schedule as the developed countries or that ‘would result in serious harm to the economy of the United States’ (United States Senate, 1997). With this resolution hanging in the background, Vice President Gore led the US delegation to the 1997 Conference of the Parties in Kyoto, Japan. The resulting Kyoto Protocol did not impose emissions reductions requirements on developing countries. President Clinton signed it, but he never submitted it to the Senate for ratification, knowing it would be defeated.

Three years later, with the Kyoto Protocol continuing to lack the ratifications necessary to bring it into force, George W. Bush prevailed in the 2000 presidential election over Vice President Gore. Shortly after taking office in 2001, the second President Bush expressly repudiated the Kyoto Protocol, citing its lack of binding emission reduction requirements for China and India.

Throughout the eight years of George W. Bush’s presidency, the US federal government refused to take regulatory action on climate change. In key part, EPA’s general counsel rejected the reading of his predecessors under President Clinton that the Clean Air Act authorized the agency to regulate GHGs. In response, several environmental groups and sympathetic states launched a campaign of administrative petitions and then lawsuits to try to overturn this interpretation. This culminated in 2007 with the landmark US Supreme Court decision in Massachusetts v EPA, in which the Court (by a 5-4 majority) found that the plaintiffs had standing to sue, that GHGs do fit within the CAA’s definition of ‘air pollutant’, and that EPA must (p. 610) either regulate them or offer a reasoned explanation of why not (Massachusetts v EPA, 2007). This decision was issued twenty months before the expiration of President Bush’s term. EPA made no findings and proposed no GHG regulations during that period, but in July 2008 it issued an ‘advanced notice of proposed rulemaking’ that set forth numerous regulatory options and requested public comment.

Climate change was not a contested issue in the 2008 presidential election campaign. Both the Republican nominee, Senator John McCain of Arizona, and the Democratic nominee, Senator Barack Obama of Illinois, affirmed the reality of anthropogenic climate change and supported a cap-and-trade law.

Immediately upon taking office in January 2009, President Obama directed the EPA to move vigorously in exercising the authority the Massachusetts v EPA decision found it had. In so doing, President Obama made it clear that the Clean Air Act was not the ideal device for fighting GHGs, but instead was being used as a spur for Congressional action and as a backup in case such action failed.

By any gauge, 2009 was a tumultuous year for climate change politics in the United States; President Obama pressed for a cap-and-trade law. Such a bill passed the House of Representatives on June 26, by a vote of 219-212. Called the Waxman–Markey bill, it would have established an economy-wide cap-and-trade program. It also contained extensive provisions on energy efficiency, international offsets, carbon capture and sequestration, and other climate-related matters. The bill was 1,428 pages long and embodied numerous compromises that were necessary in order to obtain a sufficient number of votes. Despite the watered-down nature of the bill, in retrospect, its passage in the House of Representatives marked the apogee to date of US political support for regulating GHG emissions.

The bill immediately ran into trouble in the Senate, however. Interest groups (especially those involved in extracting and using fossil fuels) mobilized effectively and persuaded many senators to oppose it. A campaign to question the validity and integrity of climate science took off and found many adherents. The worldwide financial crisis increased unemployment in the United States and heightened concerns that climate regulation would hurt the economy. Thus, although President Obama had hoped to go to the 15th Conference of the Parties to the UNFCCC in Copenhagen in December 2009 armed with domestic legislation, or at least the solid expectation that such legislation was forthcoming, he could not do that. This inability, coupled with other factors, meant that the Copenhagen conference fell far short of the expectations that had been raised for it just a few months earlier, as discussed in Chapter 5 of this volume. Sealing the end to the burst of energy brought about by the election of President Obama, in July 2010 the Democratic majority leader of the Senate officially declared that there were not enough votes to pass the bill. Though the Senate has 100 members, under its current rules a minimum of sixty votes are needed to get a bill to the floor.

The November 2010 Congressional elections were calamitous for the Democrats and for the prospects for climate legislation. The Republicans seized decisive control of the House of Representatives, and while the Democrats retained control of the (p. 611) Senate, their majority became much slimmer. Many of the new Republican members of both houses were supported by a loosely organized rightwing faction that came to be known as the Tea Party. Its focus was on lowering taxes and reducing the size of government, including in the regulatory arena. But the Tea Party also came to deny the existence of anthropogenic climate change and to reject any mandates to reduce GHGs. This faction essentially took control of the House and of the Republican caucus in the Senate. The long-standing bipartisan consensus on environmental regulation—which had propelled legislation from 1970 through 1990—had long evaporated, and was replaced by a stark partisan divide (Skocpol, 2013).

This divide was reflected in the 2012 elections. In the crowded field of Republican candidates for President, all of them rejected the concept of GHG regulation (except for one whose polling numbers never went above a sliver, and who left the race early). This included at least two candidates who had previously embraced such regulation, one of whom, former Massachusetts Governor Mitt Romney, became the nominee. President Obama continued to support regulation but the topic had become so politically toxic that he barely spoke of the issue during the campaign.

While President Obama was re-elected and the 2012 election slightly reduced the number of Republicans in the House and the Senate, the Republican Party’s opposition to climate regulation did not waver, and the House majority remained implacable. Numerous bills were passed in the House that would strip EPA of its authority to regulate GHGs and otherwise block climate mitigation, adaptation, and research, but none advanced in the Senate, and President Obama vowed to veto any that might reach his desk. Neither side had enough votes to either pass new legislation or repeal existing statutes, so the decades-old statutory structure, built before climate change became an issue, remained in place.

In January 2013, in his second inaugural address, and in February 2013, in his State of the Union address, President Obama firmly spoke of society’s obligation to future generations to combat climate change. He said that if Congress did not act, which he knew it would not, he would use his existing authority to combat climate change. On June 25, 2013, President Obama issued his plan. It relied heavily on the CAA, as discussed below. It also announced many initiatives on energy efficiency and renewable energy, and it included measures to reduce emissions of hydrofluorocarbons and methane. It emphasized the importance of adaptation to climate change, including directing agencies to support climate-resilient investment, identifying vulnerabilities of key sectors of the economy to climate change, and managing the risks of drought, wildfires, and floods.

The national elections of November 2014 brought the Republicans into power in the Senate. The new Senate leaders were as firmly opposed to climate regulation as their counterparts in the House, and the chair of the Senate committee with jurisdiction over environmental matters is a leading climate denier.

President Obama’s final term expires in January 2017, and his successor will be elected in November 2016. As this is written in August 2015, the presidential (p. 612) campaign is already proceeding at a high pitch. Most of the leading Republican candidates are opposed to climate regulation, while all the leading Democratic candidates favor it.

As the preceding discussion should make clear, we are in a protracted era of Congressional paralysis, and the principal variable in national climate policy is the identity of the occupant of the White House. So far, climate change has not been an issue in any presidential election (though that may well change in 2016), so the fate of US climate policy is largely determined by the views of the candidates and the public on a range of other economic, social, and cultural issues, which tend to determine the outcome of presidential elections.

However, with the exception of emissions from the transport sector, the actual level of US GHG emissions is, so far, primarily influenced by factors that are wholly apart from climate policy. GHG levels from motor vehicles are largely determined by three factors: federally set fuel economy and emissions standards; the carbon content of fuels; and vehicle miles traveled. For stationary sources, especially electric generating units, fuel switching has played a key role. The unanticipated and rapid growth in the supply and the decline in the price of natural gas, caused largely by the emergence of hydraulic fracturing technologies, have severely cut into the use of coal, and have also hurt the competitive positions of nuclear power and renewable energy. When it is burned, natural gas emits only about half the GHGs as coal per unit of electricity produced—though controversy remains about the extent to which the leakage of methane in the extraction, processing, transport, and use of natural gas reduces this advantage. The overall level of economic activity, the export of manufacturing activity to the rapidly developing economies of Asia, and the diffusion of energy efficient technologies are also important factors.

Having drawn the backdrop for US climate change policy, the remainder of this chapter explores its component parts in greater detail.

3.  The Clean Air Act

Though it has antecedents from the 1960s, the CAA was enacted in more or less its current form in 1970, with significant amendments in 1977 and 1990. That 1990 amendment, together with the Oil Pollution Act of the same year, were the most recent important environmental laws passed by Congress. The CAA requires EPA’s Administrator to regulate sources of air pollution ‘which in his judgment cause, or contribute to, air pollution which may reasonably be anticipated to endanger public health or welfare’ (United States Congress, Nov. 2008; United States Congress, (p. 613) 1990). Thus one of the first actions of President Obama’s first EPA Administrator, Lisa Jackson, was to start the process of issuing an ‘endangerment finding’ for GHGs. After extensive public comment, she issued this finding in December 2009.

3.1  Mobile Sources

This endangerment finding triggered several subsequent regulatory actions. Most directly, it gave the EPA the responsibility of regulating GHGs from motor vehicles. Under the CAA, EPA issues emission standards, and under the Energy Policy Conservation Act, the National Highway Traffic Safety Administration (NHTSA) issues Corporate Average Fuel Economy (CAFE) standards (United States Congress, Dec. 2007a). When it comes to carbon dioxide they amount to basically the same thing, since the only known way to reduce carbon dioxide emissions from motor vehicles is to lower their fuel consumption. There is one federally set national standard; states cannot set their own standards. The critical exception to this rule is that California may set its own standard and, if EPA approves it, other states may adopt California’s standard. The G.W. Bush administration had denied California’s request to establish its own standard for carbon dioxide. The Obama administration was reconsidering that denial, but then found itself enmeshed in the threatened bankruptcy of several large US automakers. The complex ‘car deal’ that emerged bailed out the automakers, and also led to an agreement that there would be a single nationwide carbon dioxide standard for automobiles and light trucks. This deal covered Model Years 2016 through 2025, and will yield vehicles that are about twice as efficient as those made in 2010.

EPA has yet to issue GHG standards for several other categories of mobile sources, such as off-highway engines, aircraft, and ships. Petitions have been filed seeking to force standards for all of these categories, and more, and EPA has announced it will consider aircraft standards. Standards for medium and heavy-duty trucks are in place through Model Year 2018; EPA has proposed more stringent post-2018 standards.

3.2  Stationary Sources

Having made great progress on GHG emissions from mobile sources, the Obama administration turned to stationary sources. One important program for such sources is the CAA’s prevention of significant deterioration (PSD) program, which requires permits for certain kinds of new sources. The statute’s numerical thresholds for the applicability of this program were designed for conventional air pollutants such as sulfur dioxide, but those numbers are extremely low if applied to carbon dioxide; application of the standard thresholds to carbon dioxide would require hundreds of thousands or perhaps millions of facilities to obtain permits. (p. 614) EPA had no appetite for that, so it issued the ‘tailoring rule’—a rule to increase the thresholds so that only a little over 10,000 facilities would be covered. Without this special rule, a source that emitted as low as 100 tons per year (tpy) of a GHG would require a permit; with the rule, the threshold started at 100,000 tpy. The endangerment finding, the tailoring rule, and other EPA actions were challenged in more than 100 lawsuits filed with the US Court of Appeals for the District of Columbia. That court combined the cases and on June 26, 2012, it dismissed them all, finding that EPA was acting well within its statutory authority (Coalition for Responsible Regulation v EPA, 2012). On June 23, 2014, the Supreme Court affirmed most of that decision, but it invalidated a small portion of the rule (Utility Air Regulatory Group v EPA, 2014).

Much of the attention to stationary sources is focused on coal-fired power plants, which are by far the largest source of GHG emissions in the United States. The New Source Performance Standard (NSPS) program of the Clean Air Act empowers EPA to issue emission standards for major new stationary sources of air pollution. In April 2012, EPA issued a proposed NSPS for carbon dioxide from new fossil fuel-powered power plants. The proposed standard was the same regardless of the primary source of fuel. It could be met by combined cycle natural gas power plants, but it could not be met by coal-fired power plants unless they possessed, or committed to build on a set timetable, capacity for carbon capture and sequestration, which requires application of a technology that is not yet used in general commercial application. The proposed rule would have effectively barred the construction of any new coal-fired power plants for the foreseeable future. The proposed rule generated one lawsuit, which was dismissed as premature, and more than two million comments from the public (Las Brisas Energy Center v EPA, 2012). EPA issued the final rule in August 2015, and while it differed in several respects from the proposed rule, it still had the practical effect of barring new coal-fired power plants, at least until carbon capture and sequestration technology became commercially viable.

However, the reality is that very few new coal plants are planned in the United States, largely due to a wide range of environmental regulations, and (even more importantly) competition from inexpensive natural gas. Thus from a GHG perspective, the major issue is the fate of the existing coal-fired power plants. A different subsection of the Clean Air Act governs existing facilities, and it is much more cumbersome than the NSPS standard for new plants. For existing facilities, EPA must issue proposed standards, and tell the states to prepare detailed plans to meet them. If any state fails to prepare a satisfactory plan, EPA may issue a substitute federal plan. The process of proposing standards and revising, reviewing and possibly substituting for state plans is very lengthy and invites litigation at multiple points. EPA issued its ‘Clean Power Plan’ final rule on August 3, 2015. It aims to reduce carbon pollution from the power sector to thirty-two percent below 2005 levels. It gives each state numerical goals it must meet, and it gives the states until (p. 615) September 2016 (though they may get extensions of up to two years) to submit plans to achieve those goals. States are provided great discretion in how to meet the goals; the most likely methods will be a combination of more renewable energy, efficiency measures by electricity consumers, and switching from coal to natural gas (EPA, 2015). As this is written, many states and industries are launching litigation to challenge the rule, and other states and industries, as well as environmental groups and others, have vowed to support it. There are also efforts in Congress to halt the rule.

Coal-fired power plants are the largest but not the only large stationary source of GHGs. Standards may yet be issued for such other major categories as petroleum refineries and Portland cement manufacturers. If EPA does not propose these standards on its own, citizen groups may be expected to sue EPA to force their issuance.

Several pending EPA regulations under the Clean Air Act would restrict air pollutants that are not GHGs, but that come from GHG-emitting sources. These regulations could inhibit the construction of some of these sources, and lead to the closure or more efficient operations of others. Among the rules in the regulatory pipeline is the Utility Maximum Achievable Control Technology (‘Utility MACT’), which sets limits on mercury, acid gas, and other toxics from new power plants by specifying the maximum achievable control technology. In June 2015 the Supreme Court found that EPA had made procedural errors in promulgating this rule, but it left the rule in effect while the US Court of Appeals considers whether to vacate the rule while EPA corrects the error (Michigan v EPA, 2015). Still pending is the ‘Boiler MACT’, which likewise would regulate industrial boilers and incinerators. Other important rules are the Cross-State Air Pollution Rule, which addresses sulfur dioxide and nitrogen oxides, and which has experienced repeated setbacks in court (EPA v EME Homer City Generation LLC, 2014), and new ambient air quality standards for ground-level ozone, sulfur dioxide, and fine particulates (PM2.5).

3.3  Fugitive Methane Emissions

Natural gas is mostly methane, which is a potent GHG. There is growing concern that a great deal of methane is escaping in the extraction, processing, transport, and use of natural gas and certain types of oil extraction. This concern is heightened by the tremendous growth of the use of hydraulic fracturing techniques. In April 2012, EPA finalized rules that will reduce emissions of certain non-GHGs from new oil and natural gas systems; this will also reduce methane leakage. EPA could also regulate methane from new sources in this sector directly, which it has so far declined to do, as well as adopt rules for existing systems. Such rules could have a substantial effect on the ‘lifecycle’ advantage of electricity generation using natural gas versus coal. Controlling fugitive methane from extraction is especially important as power (p. 616) generation relies more heavily on natural gas. A great deal of methane also escapes from coal mines. EPA could issue performance standards for new coal mines, and guidelines for states to regulate existing mines, but so far it has refused to do so.

Municipal solid waste landfills are another source of methane emissions. Emissions of volatile organic compounds from landfills are already regulated under the CAA; this incidentally also captures a great deal of methane. These standards could be strengthened, or new standards could be promulgated specifically for methane.

3.4  HFCs

Under Title VI of the CAA, which helps implement the Montreal Protocol on Substances that Deplete the Ozone Layer, EPA may regulate Hydrofluorocarbons (HFCs). HFCs are powerful GHGs and are used primarily for refrigeration and air conditioning. A phase-down of HFCs has already been proposed, but this could be accelerated, yielding considerable GHG benefits. Moreover, the Department of State could press for further international reductions in HFCs and other ozone-depleting substances under the framework that led to the Montreal Protocol. In July 2013, the United States and China announced an agreement on cooperative action to reduce HFCs.

4.  Other Federal Authorities

In addition to the Clean Air Act, several other sources of federal authority can be utilized in the fight against climate change.

4.1  National Environmental Policy Act

NEPA, adopted in 1970, requires the preparation of environmental impact statements (EISs) for major federal actions that may significantly affect the environment. Several judicial decisions have held that climate change is an appropriate subject for analysis in EISs (Ctr. for Biological Diversity v Nat. Highway Traffic Safety Admin, 2008; Mid States Coalition for Progress v Surface Transport Board, 2003). On February 18, 2010, the Council on Environmental Quality (CEQ), the unit of the Executive Office of the President that oversees implementation of NEPA, issued (p. 617) draft guidance on NEPA and climate change (Sutley, 2010). After the receipt of large numbers of comments and extensive deliberations, on December 24, 2014, CEQ issued revised draft guidance (Council on Environmental Quality, 2014).

The draft guidance directs agencies to consider the potential effects of a proposed action on climate change, using projected GHG emissions as a proxy for those effects. CEQ identifies a reference point of 25,000 metric tons of carbon dioxide equivalents (CO2e) annually as a threshold below which a quantitative analysis of GHG emissions is not recommended unless it can be easily accomplished.

The draft guidance instructs agencies to assess both direct and indirect climate change effects, taking into account both the proposed action and any ‘connected’ actions, so long as these effects are ‘reasonably foreseeable’. Specifically, the NEPA analysis should account for emissions from activities that have a ‘reasonably close causal relationship’ to the Federal action, including those that occur as a predicate for the agency action (upstream emissions) and as a consequence of the agency action (downstream emissions). For example, the guidance notes that the NEPA analysis for a proposed open-pit mine could include the reasonably foreseeable emissions from different components of the mining process, such as clearing land for extraction, building access roads, transporting the extracted resource, refining or processing the resource, and consuming the resource.

The guidance clarifies that agencies will continue to have ‘considerable discretion’ when determining the appropriate level (broad, programmatic, or project-specific) and type (quantitative or qualitative) of analysis required to comply with NEPA. It instructs agencies to apply a ‘rule of reason’ when deciding how to analyze these issues, taking into account the availability of information, the usefulness of that information to the decision-making process and the public, and the extent of the anticipated environmental consequences. In applying this rule, agencies should aim to ensure that ‘the level of effort expended in analyzing GHG emissions or climate change effects is reasonably proportionate to the importance of climate change related considerations to the agency action being evaluated’.

The guidance also directs agencies to consider the implications of climate change impacts on the proposed action, including potential adverse environmental effects that could result from drought or sea level rise. According to CEQ, such considerations are squarely within the realm of NEPA and will enable the selection of smarter, more resilient actions.

Several states are ahead of CEQ in requiring climate disclosures in their own state-level environmental review laws (Gerrard, 2009). For example, on July 15, 2009, the New York Department of Environmental Conservation issued a policy on assessing energy use and GHG emissions in EISs (New York State Department of Environmental Conservation, July 2009). Similarly, consideration of climate change has become a standard part of the EIS process under California’s equivalent of NEPA, the California Environmental Quality Act.

(p. 618) 4.2  GHG Reporting Rule

EPA promulgated the final Mandatory Greenhouse Gas Reporting Rule (Reporting Rule) on October 30, 2009 (EPA, 2009). It was authorized by information-gathering provisions of the Clean Air Act and by the FY2008 Consolidated Appropriations Act (United States Congress, Dec. 2007b; United States Congress, Oct. 1990a; United States Congress, Oct. 1990b). It applies to air pollution sources within any of a long list of industry categories. Certain kinds of sources automatically need to report; others must report only if they emit at least 25,000 metric tons per year of carbon dioxide equivalent. Suppliers of fossil fuels and certain industrial gases must also report.

Covered sources were to begin monitoring their emissions on January 1, 2010, except that for three months (and twelve months under some circumstances) owners had some flexibility in the methods by which they would determine their emissions. The EPA regulation has considerable sector-by-sector detail about the methods of monitoring and reporting (Ternes, 2009). The initial regulation covered thirty-one industry sectors. Several additional sectors have subsequently been added.

The first annual emissions monitoring reports were due March 31, 2011. Failure to monitor, to report, or to carry out the rule’s other requirements are violations of the Clean Air Act, and the rule specifically provides that each day of violation constitutes a separate violation (United States Congress, Dec. 2009).

EPA has compiled the reports and issued a national emissions inventory, which is posted on its website (EPA, April 2013). This inventory allows identification of the largest GHG emitters in the country, in each state, and in cities. This is very similar to the Toxic Release Inventory reports compiled by EPA under the Emergency Planning and Community Right-to-Know Act. These lists garner considerable attention, sometimes leading to public campaigns to pressure the largest emitters. The new GHG inventory also helps define the universe of entities that will be regulated in any future Congressional enactment on GHGs.

4.3  Securities Disclosure

The Securities and Exchange Commission (SEC) regulates, among other things, the capital markets, and it imposes numerous disclosure requirements on publicly traded corporations. On January 27, 2010, the SEC adopted an interpretive guidance document regarding disclosure related to climate change—a significant development for those who practice at the intersection of securities law and environmental law (United States Congress, Feb. 2010).

The guidance built upon the SEC regulations that are familiar to lawyers in this area. Regulation S-K tells securities registrants to disclose certain environmental information. Item 101 of Regulation S-K requires a description of the business, including certain costs of complying with environmental laws. Item 103 mandates disclosure of (p. 619) material pending legal proceedings. Item 303 concerns management’s discussion and analysis of financial condition and results of operations. Item 503(c) requires disclosure of risk factors. Regulation S-K was first adopted in 1982, and since then lawyers have accumulated a great deal of experience in making environmental disclosures under it.

For several years, it had been apparent that disclosure of climate risks was going to be required. In 2008 CERES, the Environmental Defense Fund, and others formally petitioned the SEC to issue guidance on the topic. Also in 2008, New York Attorney General Andrew Cuomo launched an investigation into the climate disclosures of five electric utility companies, and he has reached settlements with three of them. Cautious lawyers were advising their clients to make disclosures.

The SEC guidance lists four ways that climate change may trigger disclosure:

The first is the impact of actual and proposed climate legislation and regulations. Significantly, the guidance states, ‘management must evaluate whether the pending legislation or regulation is reasonably likely to be enacted. Unless management determines that it is not reasonably likely to be enacted, it must proceed on the assumption that the legislation or regulation will be enacted’ (United States Congress, Feb. 2010). The guidance also specifies that disclosure of proposed laws must include positive as well as negative consequences. For example, companies should disclose if they will be able to profit from the sale of allowances or offset credits (United States Congress, Feb. 2010). Disclosure is also required of the costs to comply with new regulatory limits, or ‘[c]‌hanges to profit or loss arising from increased or decreased demand for goods and services produced by the registrant arising directly from legislation or registration, and indirectly from changes in costs of goods sold’ (United States Congress, Feb. 2010).

The second item is the business impact of treaties or international accords relating to climate change. For example, the current uncertainty about the future of the Clean Development Mechanism (CDM) under the Kyoto Protocol will affect some businesses with operations in signatory countries. For example, a large industrial facility in Europe may be counting on purchasing offsets from a wind project it is financing in China under the CDM. If the CDM were to be eliminated, such allowances might no longer be available, and the facility might have to find another way for its GHG emissions to comply with the applicable GHG emission limitations.

The third item is the indirect consequences of regulation on business trends. Among the examples given by the SEC are: decreased demand for goods that produce significant GHG emissions; increased demand for goods that result in lower emissions than competing products; increased competition to develop innovative new products; increased demand for generation and transmission of energy from alternative energy sources; and decreased demand for services related to carbon-based energy sources, such as drilling services. Also included in this category is the effect of climate regulation on a registrant’s reputation. Here the SEC specifically refers to the public’s perception of any publicly available data relating to company-specific GHG emissions (United States Congress, Feb. 2010). EPA’s Reporting Rule is, of course, a prime source of such data.

(p. 620) The fourth item is the physical impacts of climate change. The SEC lists several examples, including: property damage to operations along coastlines; effects of severe weather, such as hurricanes or floods; increased insurance claims; decreased agriculture production; and increased insurance premiums and deductibles (United States Congress, Feb. 2010).

Though the SEC guidance received a great deal of attention when it was issued, SEC has taken little or no enforcement action to ensure compliance. Rigorous adherence to the guidelines might induce corporate managements to think more systematically about how their operations affect the climate, and how the climate affects their operations. This in turn could lead to more corporate efforts at both mitigation and adaptation. The absence of enforcement is thus a lost opportunity (so far) to change corporate behavior.

4.4  Endangered Species Act

The Endangered Species Act (ESA) aims to protect species from extinction. It directs a federal agency, the Fish and Wildlife Service, to designate certain species as endangered or threatened; for marine species, that task falls to the National Marine Fisheries Service. Federal agencies undertaking, authorizing, or funding physical projects must determine whether any endangered or threatened species are present on the project site and, in some instances, in the nearby area. If any are, the agency must ‘insure that any [such] action … is not likely to jeopardize the continued existence of any endangered species or threatened species or result in the destruction or adverse modification of habitat of such species’ if that habitat has been designated as ‘critical’ (United States Congress, Nov. 1988a). This provision has been interpreted literally by the courts, and can lead to the halting of large projects (Tennessee Valley Authority v Hill, 1978).

A separate program under the ESA applies to private parties. It provides that ‘it is unlawful for any person subject to the jurisdiction of the United States to … take any [endangered] species within the United States or the territorial sea of the United States,’ without obtaining what is termed an ‘incidental take permit’, the availability of which is severely restricted (United States Congress, Nov. 1988a; United States Congress, Nov. 1988b). The term ‘take’ is defined and interpreted very broadly (United States Congress, Oct. 1988a; United States Congress, Oct. 1988b; Babbitt v Sweet Home Chapt. of Communities for a Great Oregon, 1995). Some commentators have suggested that the ESA could be used to fight GHG emissions anywhere in the United States, on the theory that the cumulative load of GHGs is contributing to the extinction of many species (Moritz et al, 2008). However, the impossibility of attributing impacts on any given species to the emissions from any particular source has convinced most scholars and activists that this method would be ineffective, and no lawsuits asserting this theory have been brought (Ruhl, Aug. 2009).

(p. 621) Nonetheless, there has been considerable litigation seeking to force the listing of certain species that are imperiled by climate change. The most prominent of this litigation has concerned the polar bear, which has now been listed as threatened (In re Polar Bear Endangered Species Act Listing & Section 4(d) Rule Litigation, 2013). The effect may be to inhibit or regulate activities in the Arctic in or near polar bear habitat, such as oil drilling in certain locations.

4.5  Energy Policy and Conservation Act of 1975

The Energy Policy and Conservation Act of 1975 (EPCA) does not explicitly address climate change, but it plays a crucial role in a strategy that is central to reducing GHG emissions, energy efficiency (Gerrard, 2011; United States Congress, Oct. 1992). In addition to requiring the establishment of CAFE standards for motor vehicles, as addressed above, EPCA, as amended several times since 1975, sets energy efficiency standards for certain consumer products and authorizes the Department of Energy to set or revise others. It also establishes a program for testing, labeling, and standard-setting for commercial and industrial equipment.

Another energy-specific enactment, the Energy Policy Act of 2005, as expanded in 2007, establishes a renewable fuel standard that requires petroleum refiners and importers to blend large quantities of ethanol and biodiesel into fuel supplies. This was touted as a way to reduce GHG emissions and improve energy security, but the climate benefits are the subject of considerable debate, especially in view of the lifecycle GHG impacts of producing this fuel; the standard’s principal backers have been agricultural interests, especially corn producers who have greatly benefited from the increased demand for their product for the production of ethanol as a result of this standard.

5.  Regional, State, and Local Efforts

During the G.W. Bush administration, one of the ways that frustration over federal inaction manifested itself was through efforts at subnational levels to adopt climate regulatory programs. These were generally seen as interim measures to pressure Congress to act, and as ways to test out and refine methods such as cap-and-trade on a small scale before they were adopted nationally. When the political shift signified by the 2010 election meant that congressional action was still years away, these programs took on added significance.

(p. 622) 5.1  Regional

By 2007 at least eight multi-state groupings had formed with the objective of creating regional systems of GHG regulation, mostly based on cap-and-trade programs. Only one of these ever actually went into operation; the others faded away, largely due to lack of enthusiasm by the relevant governors.

The one program that was actually launched and is still operational is the Regional Greenhouse Gas Initiative (RGGI). RGGI was initiated in 2003 when George Pataki, a moderate Republican who was governor of New York, invited several other Northeastern and Mid-Atlantic states to develop a regional strategy to reduce GHG emissions. Ten states ultimately joined—Maine, New Hampshire, Vermont, Massachusetts, Rhode Island, Connecticut, New York, New Jersey, Maryland, and Delaware. RGGI eventually shrunk to nine states in 2011 when Governor Chris Christie unilaterally withdrew New Jersey, and then vetoed state legislation that would keep the state in. The participating states adopted a Memorandum of Understanding under which each agreed to adopt its own program through either legislation or regulations to reduce GHG emissions from its power plants, to auction emissions allowances, and to utilize the proceeds of those auctions.

RGGI applies only to carbon dioxide emissions from fossil-fuel power plants with a capacity of at least 25MW; discussions of expanding the covered pollutants and source categories have not borne fruit. Each covered plant in the region must purchase one allowance for each ton of carbon dioxide it emits. The allowances are sold in quarterly auctions; the first was held on September 25, 2008, for the compliance period that began January 1, 2009. They are also traded in a secondary market. At the outset a total regional emissions cap was set, and each state was allocated a certain emissions budget, set at the actual level of emissions from the covered plants in 2005. The total emissions budget was frozen for the period 2009 through 2014; starting in 2015, the emissions cap would decline by 2.5 percent per year, so that by 2019, all state budgets would be ten percent below the initial base.

The auction revenues go to the participating states in proportion to the allowances bought by the generating plants in those states. As of December 2014, the total auction proceeds that had been returned to the states were approximately US$1,934,000,000 (Analysis Group, 2015). The states have put about half of this money into energy efficiency programs, and one-fifth into general state government funding, and the rest into a variety of renewable energy investments; education, outreach and job training; direct bill assistance to consumers; and administrative costs for GHG programs (Hibbard et al, 2011).

The auction price of allowances peaked at $3.51 in the March 2009 auction. It then declined precipitously, mostly as a result of the economic downturn and the conversion of much electric generating capacity from coal to natural gas. From 2010 through 2012, allowances told at or near the established floor of about $1.90. Though the auctions still generated substantial revenues for the states, the allowance price (p. 623) was too low to have much direct effect on GHG emissions. Thus the RGGI states in 2013 lowered the total emissions cap in the hopes that this would raise the allowance price; that succeeded, and the June 3, 2015 auction price was $5.50 (RGGI, 2015).

As the allowance price rises, so too does concern that more power will be imported into the region. The RGGI states are connected by the electricity grid to their neighbors. If the price of generating electricity in an RGGI state goes up as a result of having to purchase carbon dioxide allowances, the electricity distribution companies in a state, which, after restructuring of the electricity industry, for the most part no longer own the generating plants, will have an incentive to buy power from out-of-region generators that do not have to pay for allowances. This phenomenon, known as ‘leakage’, would negate the GHG advantages of RGGI, since more power would be bought from and generated by power plants that are not constrained by the RGGI cap and do not have to pay for allowances. The RGGI states are working to find the best way to address this issue within the constraints imposed by the Commerce Clause of the US Constitution.

5.2  State Programs

Every state has laws and programs that have bearing on climate change, whether directly or indirectly. They can be put into three categories—explicit climate change programs, electricity sector initiatives, and land use and building programs.

A.  Explicit Climate Change Programs

As of August 2015, thirty-four states have completed climate action plans (Center for Climate and Energy Solutions, Aug. 2015a). Twenty of these states have GHG emissions targets or goals (Center for Climate and Energy Solutions, Aug. 2015b). But only one state—California—has set up an economy-wide cap on emissions with enforcement provisions. Indeed, California is unquestionably leading the nation, and is arguably leading the world, in its climate change program.

In 2006 Governor Arnold Schwarzenegger signed California’s Global Warming Solutions Act, also known as AB32. It requires California to lower GHG emissions to 1990 levels by 2020. To meet this requirement, the state has adopted a series of measures. The most important of these are:

  • •  A cap-and-trade program, whose first phase took effect in January 2013, covering over 300 large emitters; a second phase covering many more emitters took effect in 2015. This program has been linked to a similar program in Quebec, Canada, and discussions are underway with Ontario.

  • •  A plan to generate thirty-three percent of electricity from renewable sources by 2020, with a proposal by the current Governor to achieve fifty percent by 2030.

  • (p. 624) •  A plan to expand and strengthen the state’s already leading energy efficiency program, including appliance and building standards.

  • •  A land use program to encourage transit-friendly densities.

  • •  A low carbon fuel standard for vehicle fuels.

California’s program also includes an elaborate set of measures to adapt to climate change.

In 2010 a state-wide ballot initiative sought to suspend the operation of AB32 for an indefinite period of time. The campaign for this initiative was largely funded by a handful of fossil fuel companies. The initiative was resoundingly defeated; 38.5 percent of the votes were in favor and 61.5 percent were opposed. In the same election, the voters sent or returned to the Governor’s office and the US Senate candidates who staunchly supported climate regulation. Thus the political support in California for continuation of the climate change program remains solid. The AB32 program, however, has also been the subject of a large number of lawsuits, some brought by industries that oppose strong regulation, and others brought by environmental justice advocates who oppose cap-and-trade techniques. This litigation has delayed implementation of some elements of AB32, but most of the program has survived challenge and moved forward with little modification.

B.  Electricity Sector Initiatives

Many states have adopted programs to lower the carbon content of their electricity sector. A total of thirty states have enacted renewable or alternative energy portfolio standards, which mandate that a certain percentage of the electricity generated in the state come from renewable or alternative sources. The states vary considerably in the required percentage, the definition of eligible energy sources, and other design features. Some of the states have ‘carve-outs’ that require a certain percentage of the power to come from specified types of sources, such as solar, and some also require certain expenditures for energy efficiency. Another seven states have renewable or alternative energy goals (Center for Climate and Energy Solutions, Aug. 2015c). These renewable portfolio programs have generally been found to be quite effective in encouraging the development of renewable energy facilities, especially wind (Delmas and Montes-Sancho, 2011; Carley, 2009; Wiser et al, 2007).

Many states have also adopted public benefit funds, sometimes called system benefit charges. These are small fees or surcharges on electricity bills that must be used to help pay for renewable energy, energy efficiency measures, and assistance to low-income consumers. Additionally, most states require ‘net metering’, under which customers who generate their own electricity from renewable sources are able to sell their excess electricity back into the grid; in effect, the meter runs backward. In all, forty-four states have this requirement (Database of State Initiatives for (p. 625) Renewables & Efficiency, August 2015). Tax credits and grant and loan programs for renewables and efficiency are also common.

C.  Land Use and Building Programs

Many states have adopted energy efficiency building codes, often based on model codes prepared and periodically updated by the International Code Council and the American Society of Heating, Refrigerating and Air-Conditioning Engineers. As noted above, California has a program that requires land use plans to encourage use of public transit, but for the most part, land use is a matter of local control. State infrastructure policies—for example where to build roads and commuter train tracks—have an important influence on land use and travel patterns, of course.

5.3  Local Programs

Several large cities have included in their building codes important provisions requiring energy efficiency. Most of these concern new buildings, but increasingly cities are also focusing on the retrofitting of existing buildings. Where the states have not adopted the model energy efficiency codes, many cities have done so. Many cities and smaller municipalities require new or modified buildings to meet the Leadership in Energy and Environmental Design (LEED) standards adopted by the US Green Building Council.

Many cities have also embraced programs to discourage automobile use through such means as bicycle lanes, carpool incentives, and tolls and fees. Cities are also targeting emissions from municipal vehicle fleets, such as waste collection trucks, as well as emissions from sewage treatment plants and municipal solid waste landfills.

Increasingly, cities also are turning attention to the challenges of adapting to the climate change that is already occurring and that will become more severe in the years to come. In the wake of Hurricane Sandy in October 2012, for example, New York’s Mayor Michael Bloomberg released a $20 billion adaptation plan. His successor, Bill de Blasio, is moving forward with the plan and has expanded it, as at the time of writing (City of New York, 2015).

6.  Civil Litigation

Beyond federal regulation and sub-federal actions, litigation has also played a crucial role in shaping US climate change law and policy. There are two major kinds of litigation about climate change in the United States. These are administrative (p. 626) litigation, in which the action or inaction of a government agency is challenged, and common law litigation, in which courts are asked to formulate rules about liabilities and obligations. The administrative cases have, with one exception, garnered relatively little attention, but some have had great impact. In contrast, the common law cases have attracted much attention but have had almost no tangible impact outside, perhaps, of the realm of public opinion.

6.1  Administrative Cases

One distinctive aspect of US environmental law is the access it provides to the courts for people and groups who wish to sue the government. The Administrative Procedure Act and most of the federal environmental statutes authorize suits against EPA and other federal agencies if they take actions that violate statutorily required procedures, or do not properly apply established standards (United States Congress, Jan. 2011). Suits are also allowed if the government fails to take required actions or meet deadlines.

As discussed above, the Supreme Court’s 2007 decision in Massachusetts v EPA made it clear that EPA has the power and the duty to take action to control/regulate GHGs. While the decision had little immediate impact on an unsympathetic administration, as soon as a president took office who supported action to combat climate change, the decision in Massachusetts v EPA enabled the EPA to unleash a flurry of regulatory activity.

Every major EPA regulatory action, and many minor ones, lead to a gauntlet of litigation. In response to each major regulatory action EPA initiates, it is typical for industry and anti-regulation states to respond by saying EPA went too far or too fast, while environmental groups and pro-regulation states respond by saying EPA did not go far enough, or moved too slowly. Litigation was a major spark behind much of the activity described above under NEPA, the ESA, and other statutes. In the United States, litigants typically bear their own legal costs, unlike in those countries where the loser usually pays; thus the fear of having to pay for the other side’s lawyers does not normally inhibit the bringing of lawsuits.

The principal constraint on environmental litigation is the standing doctrine, under which plaintiffs much have a sufficient stake in a case before they may get into court. This doctrine is primarily founded on the provision in the US Constitution that the federal courts may hear only actual ‘cases and controversies’, and may not issue advisory opinions. The doctrine had little force in the environmental arena until a series of decisions written by Justice Antonin Scalia (Lujan v Nat’l Wildlife Fed’n, 1990; Lujan v Defenders of Wildlife, 1992). For a time it appeared that cases about climate change might be kept out on the basis of this doctrine, in part because few specific individual actions can have a detectable effect on the global climate and therefore plaintiffs might not have a sufficiently definite stake (p. 627) in the outcome of a particular case. The Massachusetts v EPA ruling allayed these concerns to a certain extent.

6.2  Common Law Cases

The administrative cases ask judges to apply rules established by Congress, state legislatures, and administrative agencies. The common law cases, instead, ask judges to apply and extend doctrines that have been created by prior judges over a period of centuries. The doctrine that is most pertinent in the climate context is public nuisance. The Second Restatement of Torts defines a common law public nuisance as an activity that creates an ‘unreasonable’ interference with a right common to the general public (Second Restatement of Torts, 1979). Determining whether an interference is unreasonable requires weighing ‘the gravity of the harm against the utility of the conduct’ (Second Restatement of Torts, 1979).

Between 2004 and 2008, several lawsuits were filed in the federal courts against major industrial companies claiming their GHG emissions, or the emissions from their products, exacerbated climate change and amounted to a public nuisance. One of the cases sought injunctive relief; the others demanded very large money damages. These cases received a great deal of publicity, and ignited hopes in some that the courts would step in to correct a problem that Congress had been unwilling to solve. This line of cases ran into a brick wall with the June 2011 decision of the US Supreme Court in American Electric Power v Connecticut (AEP) (American Electric Power v Connecticut, 2011).

By way of background, in 2004 two suits were brought against six electric power companies that ran fossil fuel plants in a total of twenty states. One suit was brought by eight states and New York City; the other suit was brought by three land trusts. The plaintiffs in both cases claimed that the GHGs from the power plants constitute a common law nuisance, and they asked the court to issue an injunction requiring the plants to reduce their emissions.

In 2005, the district court dismissed the cases on the grounds that they raise non-justiciable political questions (Connecticut v American Electric Power, 2005). The Second Circuit heard oral argument in June 2006. As the third anniversary of that argument passed, the Second Circuit’s long delay in issuing a decision became one of the great mysteries in climate change law. Meanwhile, the Supreme Court issued the landmark decision in Massachusetts v EPA, and later one of the three members of the panel that heard the arguments in the AEP case was elevated to the Supreme Court, Judge now Justice Sonia Sotomayor. Finally, in September 2009, the two remaining members of the panel—Judge Joseph McLaughlin, an appointee of the first President Bush, and Judge Peter W. Hall, appointed by the second President Bush—issued the decision (Connecticut v American Electric Power, 2009).

(p. 628) The Second Circuit decision was a major win for the plaintiffs. First, the panel found that the case was indeed justiciable and did not raise political questions, as that concept has been interpreted by the Supreme Court. Second, though it did not need to, the panel found not only that the states had standing to sue, which might have been foreshadowed by the Massachusetts decision, but also that the private land trusts had standing because they alleged that their property was being harmed by climate change. This finding potentially opened the courthouse doors to broad classes of people and entities beyond states. Third, the panel found that the federal common law of nuisance applied, and that it had not been displaced by the Clean Air Act and EPA actions under that statute. Based on these conclusions, the Second Circuit remanded the case to the district court for further proceedings.

The Supreme Court reversed the Second Circuit decision. Eight justices participated; Justice Sotomayor was recused. The decision was unanimous, 8-0, and was written by Justice Ruth Bader Ginsburg. The decision found that the federal common law nuisance claims could not proceed. The sole reason was that the Clean Air Act, as interpreted in Massachusetts v EPA, gave EPA the authority to regulate greenhouse gases, and EPA was exercising that authority. This displaced the federal common law of nuisance. The Court declared, ‘Congress delegated to EPA the decision whether and how to regulate carbon-dioxide emissions from power plants; the delegation is what displaces federal common law’. Thus it is not for the federal courts to issue their own rules.

The Court explicitly did not decide whether the Clean Air Act preempts state public nuisance litigation over GHGs. The plaintiffs in AEP v Connecticut could have pressed this claim on remand, but they chose not to. If another plaintiff group brings such a state claim, the defendants would certainly argue that the Clean Air Act pre-empts state common law nuisance claims as well. The plaintiffs would no doubt counter that the Clean Air Act has provisions that explicitly say that common law claims are not preempted, at least by certain parts of the Clean Air Act (United States Congress, Nov. 1990; United States Congress, Nov. 1977; Her Majesty the Queen in Right of the Province of Ontario v City of Detroit, 1989; Gutierrez v Mobil Oil Corp., 1992). In the next volley, the defendants would quote Justice Ginsburg’s statement in AEP that ‘judges lack the scientific, economic, and technological resources an agency can utilize in coping with issues of this order … Judges may not commission scientific studies or convene groups of experts for advice, or issue rules under notice-and-comment procedures’.

Pressing state common law nuisance claims would raise several additional complications. One of them is the question of which state’s law would apply. If relief is sought against a particular facility, it might well be the law of the state where the facility is located. The Fourth Circuit in 2010 considered common law nuisance claims against facilities in several states in a case concerning conventional air pollutants, not GHGs (North Carolina v Tennessee Valley Authority, 2010). There, the court found that the laws of the states where the plants were located specifically (p. 629) allowed the activities—in other words, the facilities were operating pursuant to, and in compliance with, state permits—and therefore nuisance actions were precluded. If the same doctrine applied to the defendants’ facilities in a new case about GHGs, the plaintiffs would face a tough burden in proving that the plants were not operating in accordance with state law. However, in 2013 the Third Circuit held that a facility (in that case, a coal-burning power plant) could be liable under the law of its own state for a common law air pollution nuisance even if was operating in accordance with its air pollution permits (Bell v Cheswick Generating Station, Aug. 2013). It remains to be seen whether this decision will spark GHG litigation.

Another complication with state common law nuisance claims is that some states would act to bar such claims. On June 17, 2011, Governor Rick Perry of Texas signed a bill providing that companies sued for nuisance or trespass for GHG emissions would have an affirmative defense if those companies were in substantial compliance with their environmental permits (Texas, 2011).

Since the AEP opinion was based entirely on displacement by Congressional designation of EPA as the decision-maker on GHG regulation, if Congress takes away EPA’s authority to regulate GHGs but does not explicitly bar federal common law nuisance claims, these cases will come back. Thus this interestingly changes the political dynamic a bit—success by opponents of GHG regulation in their efforts to take away EPA’s authority could swiftly bring back the common law claims, unless they are also able to muster enough votes to go further and explicitly preempt the federal and state common law claims.

Another question left open was whether the Supreme Court’s decision bars all federal common law nuisance claims, or only those like AEP that seek injunctive relief. This particular question was soon answered in one of the other GHG related public nuisance cases, Village of Kivalina v ExxonMobil. This was a suit by a native village in Alaska that was endangered by the loss of the sea ice around it. The plaintiffs sued several major oil and coal companies for the cost of relocating away from the endangered coastline. The suit was dismissed by the district court on political question grounds (Village of Kivalina v ExxonMobil Corp., 2009). The appeal to the Ninth Circuit was put on hold pending the decision in AEP. After the Supreme Court ruled in that case, the Ninth Circuit dismissed Kivalina on the grounds that claims for money damages were barred by the displacement doctrine of Connecticut (Village of Kivalina v ExxonMobil Corp., 2012).

Another notable common law nuisance case was Comer v Murphy Oil, a suit brought by Mississippi landowners saying that Hurricane Katrina was made more intense as a result of climate change. That suit was dismissed by the district court; reversed by the Fifth Circuit; and then undone through a bizarre procedural sequence in which the court granted en banc review and vacated the panel decision, and then lost a quorum for en banc review but left the panel decision vacated (Comer v Murphy Oil USA, 2010). The plaintiffs in Comer re-filed the case, but that (p. 630) attempt was rebuffed by the Fifth Circuit on res judicata grounds (Comer v Murphy Oil, May 2013).

The complaints in both Kivalina and Comer also raised the claim that some of the defendant companies have aggressively misrepresented and concealed scientific information about climate change, and alleged that this amounted to an actionable civil conspiracy. This claim was not raised in AEP, and it was not decided in either Kivalina or Comer (or any other US case). Thus it is likely to be raised again.

None of these cases has come close to the merits. There was no discovery in any of them, or litigation of such difficult issues as how a district court would determine what is a reasonable level of GHG emissions from a myriad of industrial facilities, or, in the cases seeking money damages, what defendants would be liable, what plaintiffs would be entitled to awards, what defendants would have to pay what share of the award, and what plaintiffs would enjoy what share of the award. Among the other issues that would have to be addressed are: extraterritorial jurisdiction over foreign entities, whether there are limits to how many third-party defendants can be brought in, the impossibility of attributing particular injuries to particular defendants, and the effect of the fact that most of the relevant emitting facilities were presumably operating in accordance with their governmentally issued emissions permits.

6.3  Our Children’s Trust Cases

The cases just discussed were under the common law doctrine of public nuisance. A separate line of cases under a different common law doctrine was launched in 2011 by a non-profit group called Our Children’s Trust. These cases were all founded on the common law doctrine of the public trust, in which certain features of the natural world are held by the government in a public trust, and the government is obligated to protect them, at least unless the relevant legislature takes a different view. This doctrine had long been applied to certain coastal waters, and in some jurisdictions to parkland. The 2011 cases sought to extend it to the atmosphere. The lawsuits were brought against state and federal governments, and sought court orders that these governments adopt and enforce plans to reduce GHG emissions so that the atmosphere is preserved.

None of these cases has succeeded. The one that got furthest was in Texas, where a judge found in July 2012 that a provision of the Texas Constitution did include the atmosphere in the public trust; but less than a month later the judge said that it was not the court’s role to intrude on the legislature’s decisions as to environmental policy (Bonser-Lain v Texas Commission on Environmental Quality, 2012). The other cases were dismissed on the grounds that the public trust doctrine does not extend to the atmosphere, or that the doctrine of separation of powers does not (p. 631) allow the courts to make policy decisions of the sort requested (Alec L. v Jackson, 2012; Barhaugh v State, 2011).

7.  Conclusion

The United States has a large and growing body of law related to climate change, but it is scattered and not very coordinated. No comprehensive climate statute will emerge until there is a major shift in the nation’s political dynamic. Meanwhile, the President has the authority to utilize the Clean Air Act and other existing statutes to advance suboptimal but constructive measures to reduce greenhouse gas emissions. As this chapter is written in 2015, the President supports GHG regulation and both houses of Congress are opposed but without large enough majorities to override a presidential veto. Amid this Congressional paralysis, the President’s existing authority remains in place but neither expands nor contracts. Future Presidents and future Congresses could lead to much more or much less GHG regulation. Some states will probably continue to take vigorous action, but the Commerce Clause of the Constitution and other legal doctrines and statutes limit the ability of states to influence national activities, such as the generation of energy.

The nation has only begun to grapple with the multiple challenges of adapting to climate change, but this is likely to become a prominent set of issues in the years to come. This is especially so to the extent that extreme weather events are attributed to climate change, increasing pressure on government to take action.


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