Climate Law Update: Climate Change & Sustainable Energy News : Thelen Reid Law Firm : Renewable Energy, Construction, Project Finance Lawyers & Attorneys

The report noted that many in the industry favor free allocations, as a way of reducing the costs of complying with carbon dioxide reductions. But discouraged that approach, warning of potential excessive profits and noting the "overly generous" allocations under the first phases of Europe's trading system. 

With electric power generation responsible for about 40 percent of the nation's carbon dioxide emissions, or about 2.7 billion tons annually, according to the report, the industry has a big stake in the outcome of any legislation.

The issue is not confined to the federal level. In states such as California, which is contemplating a cap-and-trade program to help the state meet the demands of its groundbreaking AB 32, regulators are also wrestling with the subject. California officials are expected to make a recommendation on the allocation question this summer (see Climate Law Update story here).    

Under Lieberman-Warner, credits covering about 45 percent of the emissions would be distributed for free in 2012, according to the report, while another 573 million tons worth would be handed out to distribution companies. Those allowances would then be auctioned off to raise money for energy efficiency programs or to provide customer rebates. The Bingaman-Specter bill, on the other hand, would provide about 80 percent of the allowances for free in 2012.

At a hypothetical value of $10 a ton -- no one really yet knows how much the credits would be worth -- the value of the free credits allocated to the 100 largest utilities under the Lieberman-Warner approach would be about $10.4 billion. That comparable figure under the competing measure would be more than $18 billion.

Restricting the amount of free credits is clearly favored by at least one sponsor of the report, the Natural Resources Defense Council. In a statement accompanying the release of the assessment, Dan Lashof, science director of the environmental group's climate center said (see full text of statement here):

"Billions of dollars in allowances are at stake under the proposals to cap and reduce global warming pollution. The value of pollution allowances should benefit consumers and smart programs that deliver real pollution reductions, not polluters." 

Along with the NRDC, the report was sponsored by Ceres, a coalition of investors and environmental groups, as well as two utilities, Pacific Gas and Electric Company and Public Service Enterprise Group of New Jersey.

The report also shows stark differences between utilities based on whether credits are distributed based on the utility's emissions, or its electricity output. The emissions-based method would "penalize companies that have invested in low- and zero-carbon technologies in advance of the cap-and-trade program," the report noted.

Under an emissions scenario, the Southern Company, described by the Wall Street Journal's online site Environmental Capital as "coal heavy," would get $600 million in credits under the proportions outlined under the Lieberman-Warner bill, as opposed to $734 million if the allowances were doled out based on emissions.

For a company such as Northern California's PG&E, reliant on hydro, nuclear, natural gas and renewable generation, the differences would be even more dramatic. The company would get as little as $2 million to $4 million in allowances under the emissions scenario but receive between $99 million and $174 million if allocations were based on output, according to the report.

On a somewhat different subject, the report made another fairly startling point: Since 1990, overall carbon dioxide emissions from power plants have gone up by 29 percent; but emissions of other pollutants, including sulfur dioxide and nitrogen oxide, have dropped more than 40 percent. The difference, suggested the report's authors, was that the latter two pollutants are regulated under the Clean Air Act, while carbon dioxide has not been.      

 (Photo: Lake Almanor, California, part of PG&E hydroelectric system; Wikipedia)

"Two separate government analyses have now come to the same conclusion," Lieberman said in a statement (see text here).  "Our bill curbs global warming without harming the U.S. economy."

Lieberman said the new study predicted impacts "below even the modest figures" cited by the EPA He said the energy department also found that the bill would benefit wind and solar, as well as carbon capture and storage technology.       

The Environmental Defense Fund, which supports using markets to tackled climate change, also lauded the study's conclusions, as did the Natural Resources Defense Council (see press statements here and here). Environmental Defense recently released its own analysis of Lieberman-Warner, concluding that economic models showed cap-and-trade "consistent with long-term economic growth (see Climate Law Update story here).”

Both environmental groups characterized the economic pull of the legislation as virtually unnoticeable.

"It's like two cars driving different routes from New York to L.A. and predicting one will get there at noon and the other will arrive at 12:45," said Environmental Defense's climate campaign director Steve Cochran in the group's statement. NRDC said bill's impact would be equivalent to a two-month delay in growth.

Environmental Defense also again noted, as it has in the past with other studies, that the document didn't look at the price of doing nothing, including higher insurance costs, damage from droughts and more intense storms.

But not so fast. Inhofe, the ranking minority member of the Senate Environment and Public Works Committee, had his own take on the study, which also foresaw potentially higher prices for coal and natural gas. Inhofe focused the study's predictions of higher energy costs for households, and the consequences for industry. He also said the energy department analysts also based some assumptions on a "massive and unrealistic" boom in the construction of new nuclear plants (see statement here). Said Inhofe:

"Only in Washington could higher energy prices be characterized as not negatively impacting the U.S. economy. If Democrats have their way, Americans will pay significantly more at the pump, in their homes and in many cases, with their jobs, all to accomplish an undetectable impact on the climate."

The EDF's Cochran might have had Inhofe in mind when he declared the debate over:

“Anyone claiming the Lieberman-Warner bill will bring economic doom can now go sit with those still saying climate change is a hoax. It’s time for the Can’t-Do crowd to retire the scare tactics.”

But there's little evidence the two sides will see eye-to-eye anytime soon.

(Photo: Sen. James Inhofe's office)

Bush also expressed concern over efforts to employ existing laws, such as the Endangered Species Act and the Clean Air Act to tackle the problem. Environmentalists have been trying to prod action with the species law (see Climate Law Update stories here and here). California, and by extension other states, want to use the air law to control climate-changing emissions from cars but they have been thwarted by Bush administration officials (see Climate Law Update story here). In addition, the U.S. Supreme Court has required the U.S. Environmental Protection Agency to consider whether to regulate greenhouse gases as air pollutants under the law (see Climate Law Update stories here and here).

Bush, in his speech Wednesday, predicted the application of those laws could have widespread intrusive effects, forcing the federal government to "act like a local planning and zoning board, [having] crippling effects on our entire economy." 

The president, who has opposed such international treaties as the Kyoto Protocol, said that "all major economies" must take action to make a dent in the problem. He then suggested the United States would be willing to enter a new pact:

"Like many other countries, America's national plan will be a comprehensive blend of market incentives and regulations to reduce emissions by encouraging clean and efficient energy technologies. We're willing to include this plan in a binding international agreement, so long as our fellow major economies are prepared to include their plans in such an agreement."   

Congressional critics of Bush also quickly ripped the president’s stance. U.S. Sen. Barbara Boxer, the California Democrat who chairs the Senate Committee on Environment and Public Works, issued a statement (see text here) saying Bush’s “plan to have America stand by while greenhouse gases reach dangerous levels and threaten America and the world is worse than doing nothing – it is the height of irresponsibility.” Although greenhouse gas emissions have shown some decreases lately in the United States (see Climate Law Update story here), officials estimate they have grown nearly 15 percent since 1990 (access latest inventory here).   

Others, meanwhile, reacted more cautiously. Sens. Joseph Lieberman, I-Conn., co-sponsor of legislation that would limit greenhouse emissions and set up a trading program to help control them, said he shared the president’s preference for a market-based approach over the imposition of new carbon taxes. Lieberman said he did not believe Bush’s statement would hamper the chances of the bill he and Sen. John Warner, R-Va., are sponsoring. The measure is expected to come before the Senate in June (see text of legislation here), .

Warner, in the same statement, said the president’s support for “measures to reduce greenhouse gas emissions in the U.S. is welcome news as the Senate prepares to consider climate change legislation this summer.” Warner also praised Bush's call for an international approach to the issue (see full text of statement here).

(Photo credit: White House)

In an e-mail to Climate Law Update, EPA spokeswoman Roxanne Smith said that between the issuance of the draft and final reports, "recalculations were made to incorporate additional revised data." When that new information is incorporated, errors are addressed or "improved methodologies are adopted," she said. Those can then lead to changes for all years in the inventory, which spans 1990 to 2006, Smith added.

The inventory includes estimates of carbon dioxide, methane, nitrous oxide, hydroflourocarbons, perflourocarbons and sulfur hexafluoride. It also calculates emissions removed from the atmosphere by so-called sinks, such as forests, vegetation and soils.

According to the latest report, carbon dioxide emissions from fossil fuel combustion declined about 1.6 percent between the two years, compared to the draft document’s estimated 1.9 percent drop. Overall estimates of carbon dioxide emissions in 2006 remained unchanged in both reports, while the revised version showed a slightly lower estimate for 2005.

In addition, the newest report, which is submitted to the Secretariat of the United Nations Framework Convention on Climate Change, estimated that overall emissions of the six main greenhouse gases have grown by 14.7 percent from 1990 to 2006. The earlier report had that figure at 14.1 percent. The United Nations body monitors the Kyoto Protocol.

One of the largest tonnage differences between the draft and final reports this year appeared to be a drop in the estimate of nitrous oxide. The earlier report estimated emissions of that gas at more than 530 million tons for each of the years, while the latest document estimated the amount at 370.1 million tons in 2005 and less than 367 million tons in 2006. A portion of the report charting annual changes to the calculations noted that revisions, including incorporating state-by-state data for nitrogen fertilizer use, had produced about a 27 percent annual decrease in the estimates for nitrous oxide emissions from soil management on farms.

(Pictured: General Electric advanced gas turbine, U.S. Department of Energy photo)

She noted that other questions arise when considering the placement of wind farms and solar power facilities, some in remote and environmentally sensitive areas, such as California’s desert lands:

“Surely there are good places to build these things and bad places to build these things. What’s the right process and what’s the right way to engage people who care about the desert and don’t just see it as deadland to put things on. None of us sees deserts that way any more.”

In her presentation to the conference, which was sponsored by the school’s California Center for Environmental Law and Policy, Carlson also highlighted transmission issues. She focused on the ambitious plans of the Los Angeles Department of Water and Power, the nation’s largest municipally owned utility, to aggressively increase its generation from renewable sources. Goals include boosting to 20 percent the proportion of the utility’s electricity coming from renewables by 2010 – more than doubling the current proportion -- and hitting 35 percent by 2025, she said. California has established its own renewable portfolio standards, which generally apply to private utilities, that are similar (see background here). 

Among the consequences of the Los Angeles utility's action, Carlson noted, was the need to build a lengthy transmission project from the proposed site of some of that new generation (see project description here). That is being opposed by a number of groups, including residents and local officials in areas where the lines will run who will not benefit directly from the power (see opposition group site here). Carlson said the utility also faces other pressures. Those include demands from its own unionized workers that the utility itself own much of the renewable generation. Additionally, the facilities must comply with an array of state and federal environmental laws, legal requirements that themselves provide ample opportunity for lawsuits filed by opponents. The challenges aren't unique to Los Angeles, she said: 

“So the sort of localized environmental clashes or values battles is a problem that is really international in scope and also is really long-term, as opposed to short-term. It raises real problems for not just again LADWP but for any utility that is seeking to shit its energy sources away from conventional sources to renewable sources.”

For another example of the kind of fights that can occur and their potential consequences, the Washington Post recently looked at opposition in the “green” state of Wisconsin over new wind farms planned for offshore waters in the Great Lakes (see story here).

Of course, that might not be the full extent of the societal conflicts that could occur as restrictions on greenhouse gases tighten up. In California and other states, there are movements already underway to reduce the amount of vehicle miles people travel (see Climate Law Update stories here and here). That's an issue that might produce some real backlash in a state that has never meaningfully connected land use and transportation policy, warned  William Fulton, a land-use expert who runs the Solimar Research Group. Fulton predicted that once people realize that reducing “VMT” means driving less, they could respond politically, even launching a new recall campgain similar to the 2003 recall of Gov. Gray Davis. That led to Gov. Arnold Schwarzenegger, the politician perhaps most closely identified with California’s climate change-fighting efforts, getting into office in the first place.

(Photo of Ann Carlson via UCLA School of Law)

The document also contains a requirement that officials of the new institute seek matching funds from other sources at least equal to the money coming from ratepayers.

Overseeing the institute, which was charged with working collaboratively with the state’s colleges and national laboratories, will be a board composed of government officials, university officials, lawmakers and representatives of utilities, environmental groups and certain industries, including agriculture. It will be co-chaired by the utility commission president and the president of the University of California. A physical headquarters for the institute is yet to be determined.

The California commission’s vote comes amid increasing calls for public financing of research and development to discover and implement new technologies to mitigate global warming (see Climate Law Update story here).

Still, there was clearly unease about charging the state’s ratepayers for the costs. The institute will be funded by a surcharge on electric and gas customers’ bills. Peevey noted that some have asked why utility ratepayers alone should be asked to pay for the institute. His response:

“The short answer, frankly, is that they shouldn’t. Ratepayer financing should serve as seed money to leverage other public and private sources of funds, and I think it will. Certainly broad-based taxpayer financing would be preferable, if it was available. But we cannot wait for the Legislature to allocate funds any more than the United States can defer decisive action on climate change until China and India take action.”

Despite voting for the proposal, Bohn expressed deep reservations:

“By this action we announce our intent to assess the private utility ratepayers of the state of California $600 million over a 10-year period in order to establish and operate a new organization devoted to seeking and implementing technology solutions to the global problem of climate change. We are, in short, telling the ratepayers that as a condition of receiving essential utility services delivered by monopoly enterprises under our jurisdiction they are required to pay for research and commercialization of technologies that may indeed never deliver the results that impact global warming or, at best, are unlikely to deliver those results in the near term.”

Bohn concluded that the commission's decision "pushes the boundaries of our duty and our jurisdiction almost to the breaking point."

The institute’s work is to be carried out under a strategic plan scheduled to be in place in about a year. The governing board was also charged with establishing panels to establish protocols for transferring technology and looking at potential workforce impacts in the energy sector.

In a separate move, the utility commission approved a $4.6 million request by Southern California Edison to participate in a study on reducing greenhouse emissions from coal-fired electricity generation. The technology under consideration, according to a statement from the utility commission (see text here) would convert coal through a gasification process into predominantly hydrogen and carbon monoxide gases. The hydrogen would fuel a power plant while the carbon monoxide would be sequestered underground.

Peevey said the company would participate in a project known as the Southwest Regional Partnership on Carbon Sequestration. Among other participants, the U.S. Department of Energy has put $65 million toward the effort, he said.

(Photo of California Public Utilities Commission building: Climate Law Update)

Last November the IPCC, which won a share of the 2007 Nobel Peace Prize for its work sounding the global warming alarm, issued its fourth report assessing the climate threat (see text here). Researchers asserted that the climate is changing and that most of the increase in global temperatures since the mid-20th century was very likely due to human-caused increases in greenhouse gases. They also saw little time to act to prevent the most severe effects from occurring.

At the same time, the report also concluded that a combination of responses, including efforts to reduce or mitigate the growth in emissions, could significantly reduce the risks. Since 1997 Metz, a senior researcher at the Netherlands Environmental Assessment Agency, has co-chaired the IPCC's group looking at mitigation strategies (see mitigation report). Metz is also a visiting professor at Stanford University.

Metz said that in order to achieve the goals of avoiding the worst effects of climate change, government support for technology and “a lot of R&D” was needed. He also said that other steps, including setting a price on carbon by means such as a cap and trade program, were also critical:

“At that moment, emissions of [carbon dioxide] and other greenhouse gases get factored into business decisions. They become really part of the balance sheet. That’s a very good incentive for businesses to take proper action.” 

His remarks mirrored those of other experts who have recently advocated that more than a market-based approach will be needed to cope with global warming. There is a note of increasing urgency in light of information, such as that cited by Metz from the IPCC suggesting that more serious problems may occur at lower temperatures than earlier estimated.

The New York Times recently reported on the shifts in the debate over what to do (see story here). Among those it cited was prominent Columbia University economist Jeffrey D. Sachs. In a piece in Scientific American (see article here), Sachs argued that a variety of approaches, including new research, was needed:

“We will need large-scale public funding of research, development and demonstration projects; intellectual property policies to promote rapid dissemination to poor countries; and the promotion of public debate and acceptance of new options. We will need to back winners, at least provisionally, to get new systems moving.” 

He argued that even with a cutback in "wasteful energy spending," current technologies could not support both a reduction in carbon dioxide emissions and a growing global economy.  The key, Sachs wrote, "is new low-carbon technology, not simply energy efficiency."  

A critical issue is time. Metz displayed statistical graphs showing that emissions should have peaked no later than 2015 in order to prevent global temperatures from increasing by much more than 2 degrees Celsius, a kind of benchmark denoting the point at which serious human adaptation would have to occur.

“What we do in the coming ten to 20 years is of crucial importance, [determining] how much warming and how many impacts we will have in the longer term,” he said. Metz noted other estimates showing that if carbon were to achieve a price of about $100 a ton by 2030, that could drive emissions down to 2000 levels, which he called “a fairly positive signal.”

But he also noted that as of right now, emissions are still on the increase, and there were other factors at play. For instance, he said, even some actions that pay off economically are not being pursued.

“If you invest in energy savings in buildings you earn your money back quickly. It makes economic sense to do it and still it’s not happening because of all sorts of barriers and low incentives. That’s why specific action in terms of policy needs to be taken to make things happen.”

The task ahead, Metz suggested, employing a metaphor rooted in the fossil fuel industry, is formidable.

“It’s like turning around a super-tanker,” he said.

(Photo credit: Climate Law Update)

In general under a cap and trade system, credits or allowances represent the right to emit a certain amount of greenhouse gases. A debate has long been raging over whether at the beginning of the trading system to sell or give away the credits.

The British Columbia law would establish a cap for designated large sources of gases by issuing a limited number of what officials call “tradable compliance units” or emissions allowances for a given period of time. The emitters will then have to obtain units equivalent to the amount of greenhouse gases they emit within the specified time period. The units would then have to be surrendered to the government as proof of compliance.

The act identified three types of compliance units, including allowance units issued by the government; emissions reduction credits, which are offset credits from approved emission reduction or removal projects in the province, and recognized compliance units from other cap and trade systems, such as the Western Climate Initiative. Each unit would equal a ton of carbon dioxide or its equivalent.

Kate Thompson, a spokeswoman for the province's Ministry of Environment, told Climate Law Update that the legislation was silent on whether the emissions allowances would be auctioned or handed out for free. "That hasn't been decided yet," she said.

She said the legislation would likely progress through the provincial Parliament by May.

The Western Climate Initiative, which British Columbia joined last year, is considering a recommendation from a subcommittee that would require all of the partnership's participants to auction between 25 percent and 75 percent of their allowances, with the final figure not yet determined. Officials of the initiative are accepting public comments on the recommendation until April 16.

Under the April 2 proposal, the allowances would be sold through a coordinated process, with each of the states and provinces auctioning its allowances throughout the Western Climate Initiative region. Proceeds would go to the partners in the initiative, which include British Columbia and its sister province Manitoba, as well as the U.S. states of California, Oregon, Washington, New Mexico, Arizona, Utah and Montana. The initiative is expected to have its market system developed by August (see WCI document repository here).

Those hoping for an auction system would seem to have gotten some ammunition in the pages of the newest report on the subject, prepared for the environmental group WWF (also known as the World Wildlife Fund for Nature) by the market analysis firm Point Carbon. The report, which looked at the trading system set up in Europe, estimated that windfall profits for electricity generators in five countries between 2008 and 2012 could hit 71 billion Euros, or $111 billion.

According to the report:

"Windfall profits are highest in countries that have a high level of pass-through of [carbon dioxide] costs into wholesale power prices, countries with emissions intensive (coal) plant setting the price the majority of the time, and countries that allocate the highest percentage of free allowances to the power sector." 

An official of the WWF called the findings "a stark warning to the rest of the world on the danger of free allocations of pollution permits (see WWF statement here)."

The report said that when the European Union set up the system it allowed most of the allowances to be distributed free of charge, as a way of providing a "soft landing" to companies faced with having to deal with an emissions trading system for the first time. In addition, the study noted that in the first phase of the system starting in 2005 more allowances were handed out than required because the allocations were based on estimates rather than measured emissions.

Other jurisdictions are also dealing with the thorny issue of whether to charge for the allowances when they are initially distributed. California utility and energy officials recently adopted a recommendation to the California Air Resources Board that included advocating at least a partial auction of allowances. But it left for later critical details, such as what percentages should be sold or handed out for free (see Climate Law Update story here).                

(Photo of B.C. Environment Minister Barry Penner via Legislative Assembly of British Columbia)

The Time article contained the most scathing critique of a fuel that had been touted as a major factor in the effort to slow climate change:

"But several new studies show the biofuel boom is doing exactly the opposite of what its proponents intended: it's dramatically accelerating global warming, imperiling the planet in the name of saving it. Corn ethanol, always environmentally suspect, turns out to be environmentally disastrous. Even cellulosic ethanol made from switchgrass, which has been promoted by eco-activists and eco-investors as well as by President Bush as the fuel of the future, looks less green than oil-derived gasoline."

The biofuel industry does receive encouragement from the federal government, including last year’s Energy Independence and Security Act that required a five-fold increase in renewable fuels by 2022 (see White House fact sheet and text of legislation). The magazine reported that last year the country produced about 7 billion gallons of ethanol, costing taxpayers $8 billion in subsidies.

Time described a complex domino effect that starts with the demand for the fuels in the United States and elsewhere and ends up promoting the destruction of forests that, ironically, could help soak up the excess carbon dioxide in the atmosphere that contributes to global warming:

"In Brazil, for instance, only a tiny portion of the Amazon is being torn down to grow the sugarcane that fuels most Brazilian cars. More deforestation results from a chain reaction so vast it's subtle: U.S. farmers are selling one-fifth of their corn to ethanol production, so U.S. soybean farmers are switching to corn, so Brazilian soybean farmers are expanding into cattle pastures, so Brazilian cattlemen are displaced to the Amazon. It's the remorseless economics of commodities markets. 'The price of soybeans goes up,' laments Sandro Menezes, a biologist with Conservation International in Brazil, 'and the forest comes down.'"

The article appeared before last week’s report from the U.S. Department of Agriculture that suggested some shifts in the American farming pattern. That document (see text) said that corn planting is actually expected to decline by about 8 percent this year, with other crops, including soybeans, increasing significantly. Among others, a New York Times (see story) account of the report suggested that the changes could hike corn prices and cause difficulties for the “struggling” companies that make ethanol.

Nevertheless, suggestions that the ethanol industry is part of the climate change problem, rather than the solution, drew a sharp response from Matt Hartwig, a spokesman for the Renewable Fuels Association, an industry trade association. Hartwig said biofuels offer society the opportunity to begin moving toward a more sustainable future.

 “How did we get in the situation we find ourselves in today?” Hartwig said in an interview with Climate Law Update. “It wasn’t because of biofuels; it was because of a reckless use of our fossil fuel resources.”

The organization also issued its own written defenses of the industry and responses to the USDA report. The industry association noted that farmers themselves have had to react to rising fossil fuel prices and it attacked the scientific evidence cited by biofuel critics (see public statements here, here and here). 

Hartwig, who blamed much of the recent push-back against biofuels on criticisms coming from the oil, food and livestock industries, said ethanol production has helped strengthen corn prices. But he said that is by no means the only factor at work. He cited such pressures as the global demand for corn for food for people and livestock; the weak dollar that encourages exports and market speculation. And he bristled at the notion of a causal relationship between biofuel production in the United States and deforestation elsewhere.

“An acre of corn used for ethanol production here does not directly result in an acre of rainforest in Brazil being cut down,” Hartwig said. “They’ve been cutting down the rainforest for decades, long before the ethanol industry came into being.”

For instance, the association refuted the asserted connection between ethanol production and foreign impacts, including rainforest destruction. It noted that American corn exports generally have held steady and shipments of distiller's grains, a byproduct used for animal feed, have actually increased. At the same time, without renewable sources such as biofuels, fossil fuel use is destined to increase, the industry statements said.  

The association's Web site demonstrates that the latest brew-up isn't the first.  "Oil and Food Industry Attacks on Ethanol Misleading and Diversionary," proclaims one press release; "Wheat Prices Are High, But Not Because Farmers Planted Less," says another. And talk about subsidies: The association cites a study showing the U.S. government spends as much as $140 billion a year -- on military might to protect the oil shipping channels out of the Middle East. 

A report appearing in a USDA publication earlier this year appeared to lend some support to the biofuels industry position that ethanol production and higher food prices do not necessarily go hand-in-hand, at least for long. It cited a spike in corn prices in the 1990s that led to a "short-lived" impact on some foods. But the article concluded (see full text here): "For the most part, food markets adjusted to the higher corn prices and corn producers increased supply, bringing down price." 

Not all alternative energy sources took a punch from the media. A CNN report glowingly referred to algae as “the ultimate in renewable energy,” and cited several benefits, including its ability to help sequester carbon from power plants (see story).

And stationary power sources continued to gain lots of attention. Schwarzenegger last week, for instance, joined with Southern California Edison in announcing the nation’s largest rooftop solar installation project by a utility company (see Edison press release and Schwarzenegger press release).

In Ohio, Gov. Ted Strickland and legislative leaders unveiled a new $1.57 billion economic stimulus package that includes $150 million to help make the state "a powerhouse of renewable and advanced energy production such as wind, solar and clean coal (see press release here)." The announcement did not include many details of the program in a state that is both a big producer and consumer of coal (see Ohio Coal  Association background information).  

And in Northern California, Pacific Gas & Electric Company announced it had signed a deal for up to 900 megawatts of solar thermal power. The utility signed contracts with BrightSource Energy Inc. for 500 megawatts of electricity from three projects and it took out options for another 400 megawatts (see PG&E statement).

Meanwhile, the American Wind Energy Association released its latest list of who's on top in the industry. It found Texas to be the leading wind energy state, leading in both total installed capacity and in the amount of new projects added in 2007. Other leaders were California, Minnesota, Iowa, Washington, Colorado, Illinois and Oregon. Iowa generated 5.5 percent of its electricity from wind, the highest of any state, according to the findings. The study also found that FPL Energy operated the biggest farms and Vestas had installed the largest turbines in the United States (see press release and complete text of study).    

(Photo of organic corn crop, courtesy USDA Agricultural Research Service)

A coalition of states and environmental groups launched a new court fight with the EPA Wednesday over Johnson’s decision to institute a lengthy administrative process to consider what to do in light of last year’s landmark Massachusetts v. EPA decision by the U.S. Supreme Court. That petition, if successful in court, would also set a 60-day deadline for the EPA to issue its so-called endangerment finding, which would set the stage for new regulation of greenhouse gases (see Climate Law Update story).

Snowe’s statement was particularly notable, coming as it did from a Republican:

“The administration has a court-mandated obligation that they can no longer ignore. Their deliberate efforts to delay adherence to the Supreme Court’s decision is reckless and irresponsible. The administration’s response to global warming must coincide with what the science and the American people require.”

Attorneys who spoke with reporters Wednesday describing the legal action said it would have no impact on the decision regarding California’s automobile regulations, despite the fact the Supreme Court ruling dealt with vehicle emissions. But the Feinstein-Snowe legislation would address the issue by setting a June 30, 2009 deadline for the EPA to complete taking another look at the question of California’s efforts to restrict the emissions.

The EPA's action regarding California was in response to the state's attempt to enforce rules implementing a 2002 state law (see description rules and legislation).

(Photo of U.S. Sen. Dianne Feinstein, courtesy of her office)

Joining Massachusetts as parties were California, Connecticut, Illinois, Maine, New Jersey, New Mexico, New York, Oregon, Rhode Island, Vermont, Washington, the District of Columbia, the city of New York and the government officials of Baltimore. A number of other states also came in as friends-of-the-court in support of the filing. Many of the nation’s largest environmental groups also came on board, including the Natural Resources Defense Council, Environmental Defense Fund and the Center for Biological Diversity.

The latest action came on the one-year anniversary of the U.S. Supreme Court’s landmark Massachusetts v. EPA decision holding that the agency had the authority to regulate the emissions as pollutants under the Clean Air Act. The high court’s ruling did not outright require the agency to issue regulations but it told the EPA it had to consider such issues as whether the public health might be threatened. The ruling came in the context of regulating emissions from motor vehicles but no one believes the implications stop there.

Last week, EPA Administrator Stephen L. Johnson cited the broad potential of a decision to regulate in the area when he informed lawmakers he would take more time to consider the decision under an administrative procedure that could take months to complete. That announcement set off a wave of criticism from Democrats and environmental groups that culminated in Wednesday’s court action. But it also drew praise from some in industry (see previous Climate Law Update stories here and here).

Not all the critics were Democrats. California's Republican Gov. Arnold Schwarzenegger issued a statement Wednesday (see text) chastising the EPA for having "failed to lead" and pledging that the state is "prepared to force it out of the way in order to porect the environment."

In an e-mail to Climate Law Update, Jonathan Shradar, the EPA’s press secretary, said the agency would continue working on the process laid out by Johnson, “taking into account all sources of GHG emission and realizing the best approach for dealing with climate issues.” Shrader characterized the rule-making procedure announced by Johnson as “a reasonable path forward.” 

Advocates of government regulation have not missed the larger implications, either. Bookbinder noted that petitions have already been filed with the EPA seeking to regulate emissions from such sources as power plants. One heated controversy involves a Utah coal-fired power plant for which the EPA issued a permit that is now being appealed by environmentalists, including the Sierra Club, citing the Supreme Court decision (see Climate Law Update story).

Said Milkey:

“While the petition we filed today is specific to motor vehicles, the same logic also applies to power plants. That is, if motor vehicle emissions are causing endangerment then certainly power plant emissions are doing so and EPA has an obligation to regulate them under the Clean Air Act.”

California Attorney General Jerry Brown, who also signed on to the writ, suggested that forcing the EPA to issue its finding would have important ramifications for the national conversation over climate change:

“If this administration says that greenhouse gases endanger public health, then that’s something. That’s an important step that prevents somewhat their continuing obfuscation of this whole matter of global warming.”

The filing puts the case back in the hands of a court that had previously agreed with the EPA’s decision that it lacked the authority to regulate greenhouse emissions (see text of ruling). It was that decision the Supreme Court overturned last year. Bookbinder said the District of Columbia court is where the case started and “they’ll be the one whose job it is to enforce the Supreme Court’s mandate.”

Brown seemed to acknowledge the case might be headed into unfriendly territory.

“There’s some right-wing judges that were put on there and, you know, they have their own view of the world,” he said. He quickly added: “We’re hopeful the strength of the case is so clear that we have a good chance, although we recognize the realities that pertain in present-day Washington.”

(Photo of Massachusetts Attorney General Martha Coakley via Wikipedia)

Critics of Johnson's move said it virtually guaranteed that the EPA would not act during the remainder of President Bush’s term in office, and threats to take the agency back to court flowed freely. The statement from Brown’s office Tuesday charged the EPA had extended “the time period another twelve months” until Bush leaves the White House.

Tuesday's announcement did not say specifically what legal avenue Brown and “dozens of states and national environmental groups” planned to take. But it said their action would be aimed at stopping the EPA “from continuing to ignore the Supreme Court.”

The Supreme Court ruling did not require the agency to issue regulations but it told the EPA it had to consider such issues as whether public health was endangered.

A spokesman for the EPA could not be reached for comment Tuesday.

(Photo of Stephen L. Johnson, courtesy EPA)

Theoretically, an eventual placement of the animals on the list could lead to restrictions on a number of the local activities, as well as adding the agency as a regulatory player in combating climate change. The endangered species law contains provisions mandating that “federal departments and agencies shall seek to conserve endangered species and threatened species and shall utilize their authorities in furtherance of the purposes of this act.”

Under the law, regulators throughout government are supposed to consider potential impacts on endangered species when carrrying out their duties. That means, for one, consulting with colleagues in the wildlife regulatory agencies. It's a wide net that environmentalists believe should be used to cover government activities such as issuing permits for power plants or new highway construction.

Cummings said the seals face a "double-barreled threat" both from local development, such as oil and gas projects, and from greenhouse gas-related global warming. He noted that new threats to the animals might also develop as the ice disappears, allowing for shipping lanes to open and for additional fisheries to develop.

"It's being viewed as the new gold rush," he said. A listing of the seals would give the creatures some additional protections if the new developments occur.

But he said there would also have to be efforts to curtail emissions of greenhouse contributors such as carbon and methane.

"If we don’t stop global warming, there’s not much we can do for these species,” said Cummings, whose office is in Joshua Tree, California. He noted, for instance, that unlike some other marine mammals such as the walrus that can use dry land as a habitat of last resort, the ribbon seal is never seen on land.

In addition, he said other issues need to be examined “pro-actively,” including the impacts of an ocean fishery that may be shifting geographically northward along with warming waters.

A listing by the fisheries service would also engage an agency, which is housed in the U.S. Commerce Department's National Oceanic and Atmospheric Administration, that the environmental group feels has been historically more responsive to endangered species considerations than its sister bureaucracies. That latter category includes the Interior Department’s Fish and Wildlife Service, with which the organization has repeatedly tangled.

Part of the goal, Cummings said, is to “get [the fisheries service] involved in species management in a changing climate.”

Doug Mecum, acting administrator for the fisheries service’s Alaska region, was reluctant to predict what would result if the seals were to be listed.

“We’re kind of a long ways away from determining what, if anything, might be done,” he told Climate Law Update. He acknowledged, however, that “it’s kind of mind-boggling given the potential scope” of actions that theoretically could be implicated.

At the same time, Mecum suggested his agency’s specific authority had limits.

“I think that first and foremost you look at things