Environmental Regulatory Beat Goes On

By Robert T. Vogler, Valley Proteins Inc.

Editor’s note – Robert T. Vogler is director of environmental affairs for Valley Proteins Inc. and chairman of the National Renderers Association’s Environmental Committee. He holds a juris doctor degree from Duquesne University and bachelor of science degree in agricultural engineering and agricultural science from Rutgers University.

The United States (US) Environmental Protection Agency (EPA) continues to move forward to expand its regulatory reach by asserting jurisdiction or laying the groundwork for expanding its jurisdiction into areas beyond the bounds of federal regulation. In selected cases, courts of law are beginning to show some skepticism and pushback, while in others the courts have deferred and allowed EPA’s efforts to prevail. This article will examine the status of certain EPA initiatives of most importance to the rendering industry.

Clean Power Plan
On October 23, 2015, EPA issued its Clean Power Plan that requires states to cut carbon emissions from power generation by 32 percent from 2005 levels by 2030. States must submit plans as early as September 2016 to comply. Although the first deadline for power plants to reduce their emissions was set for 2022, states and power generators must begin planning and implementing changes quickly in order to meet this year’s deadline.

The effect of this plan is said to be a transformation of the nation’s electricity system, leading to the closing of hundreds of coal-fired power plants and major bankruptcies in the coal industry, which has called the Clean Power Plan “a targeted attack on the coal industry.”

A suit has been filed by 29 states to stop the implementation of the plan. These states have called it “the most far-reaching and burdensome rule the EPA has forced upon the states” that usurps the longstanding role of the states in regulating their power systems and allows EPA to become the central planning czar for power generation and consumption.

On February 9, 2016, the US Supreme Court took an unprecedented move and issued a stay on implementation of the plan pending judicial review. Many commentators have said the strategy by President Barack Obama’s administration was to force the plan into effect before the courts had a chance to rule on its legality thus assuring the intent of the regulation is effectuated even if it is ultimately overturned by the courts. The action by the court in imposing a preemptory stay appears to recognize this.

At this point, the regulation is essentially stopped cold until the courts have a chance to determine its legality. Individual states will determine whether to continue taking steps toward compliance pending the court challenge. If the plan is ultimately implemented, the end result would be higher electricity prices and less reliability for the United States electric grid.

Ozone Standard
On October 1, 2015, EPA adopted a new National Ambient Air Quality Standard for ground-level ozone, lowering the standard from the current 75 parts per billion (ppb) to 70 ppb. The new standard will bring a large portion of the expanding, robust economic areas of the country into non-attainment. A non-attainment designation makes the expansion of industry in that area nearly impossible and existing permits could be re-opened to require further reductions at existing facilities. The effect of the new standard is to further restrict emissions of nitrous oxides and volatile organic compounds as they are precursors to ozone. Rendering plants produce ozone precursors. Exposure to ground-level ozone, or smog, is said to exacerbate respiratory problems, such as lung disease and asthma. This regulation is said to be the most expensive in US history, costing tens of billions of dollars per year even by EPA’s own estimates.

Ozone-forming emissions have been cut in half since 1980, leading to a 33 percent drop in ozone concentrations, according to a report by the National Association of Manufacturers. It should be noted that the prior standard adopted in 2008 had not yet been fully implemented, so this is a further reduction in the standard before the environmental benefits of the prior standard were fully realized.

On December 23, 2015, a coalition of national business groups including the US Chamber of Commerce and National Association of Manufacturers filed a petition in the US Court of Appeals for the District of Columbia Circuit challenging the standard. This suit remains pending.

In March 2016, the Ozone Standards Implementation Act of 2016 was introduced in the House of Representatives (HR). This bill (HR 4775) would extend implementation deadlines, including non-attainment designations, to 2025 and reduce the frequency of periodic review of the standard from five to 10 years.

Paris Climate Accord
On December 12, 2015, a climate accord was reached in Paris, France. The new accord replaces the Kyoto Protocol under which Europe had adopted unilateral and costly decarbonization policies while other large emitters remained outside of any legally binding commitment. This caused Europe’s industrial base to lose out to international competition, essentially exporting economic opportunity and emissions outside the European Union.

In contrast, the Paris accord consists of an agreement to submit aspirational plans for addressing climate change that do not bind any members to enforceable reductions in carbon emissions. Instead, there are voluntary pledges of intentions determined and monitored by individual governments in line with their national interests. While Obama has pledged carbon reductions in the United States of 25 to 28 percent by 2025, Europe has backed away from unilateral binding policies and China used the talks to garner credit for what it was planning to do anyway as it shifts to a less energy-intensive economy and replaces coal with cleaner fuels to reduce smog.

Waters of the US
On May 27, 2015, EPA finalized a rule revising the definition of “waters of the US,” greatly expanding EPA’s jurisdiction over activities in wetlands, intermittent streams, drainage ditches, and upland areas. This was supposed to clarify the scope of federal jurisdiction over upland and isolated waterways but is widely seen as a huge power grab by EPA and the US Army Corps of Engineers. It is important to note that states already regulate these non-federal waters or have determined there is no need to regulate because of no impact on water quality.

Lawsuits have been filed by manufacturing and agriculture groups as well as most of the states challenging the rule as being beyond the statutory authority of EPA. In October 2015, the US District Court for the Sixth Circuit issued a nationwide stay from EPA enforcement of the new regulation and on February 22, 2016, ruled that the Sixth Circuit has jurisdiction to hear the case directly, bypassing the lower federal courts. It is likely this case will reach the Supreme Court on the initial question as to which court has jurisdiction to hear the case.

In March 2016, EPA issued a report completed jointly with the US Geological Service (USGS) studying the effect of stream flow changes on climate change and other environmental conditions. The report includes discussion of the effect of flow changes on surface waters as well as the interconnectivity of groundwater to surface waters. Critics view this as a step toward EPA asserting jurisdiction on water withdrawal and other flow allocation issues.

There is concern that EPA will use studies such as this to attempt to extend jurisdiction in two ways. First is an effort to regulate activities that affect surface water flows, essentially regulating flow as a “pollutant.” In 2013, EPA lost a challenge by the Virginia Department of Transportation and Fairfax County, Virginia, in the US District Court for the Eastern District of Virginia in a decision involving the Accotink Creek watershed in which EPA sought to regulate stormwater based on flow as a surrogate for sediment. In that case, the court held that flow was not a pollutant and EPA had no basis to regulate flow. This new joint study with USGS could be an attempt to do an end-run around the Accotink Creek court decision. The result would be unbridled federal jurisdiction over land development, water withdrawals, grading, impoundments, diversions, highways, and so on.

The second would be regulation over groundwater withdrawal and allocation as well as other activities that could potentially affect groundwater quality such as spray irrigation, wastewater ponds, and agricultural practices.

Information Collection Request
EPA has made a request to the Office of Management and Budget to allow EPA to collect and use information developed through “citizen science and crowdsourcing techniques.” This is data gathered by amateurs, advocacy groups, and other laypeople. It is unknown why this material is needed in light of the abundant sources of information available, how the agency plans to use this data, and what justification there is to use it in regulatory decision-making.

Chesapeake Bay Blueprint
On February 29, 2016, the US Supreme Court turned down a request by the American Farm Bureau Federation to hear its challenge of EPA’s Chesapeake Bay Blueprint, the plan for regulating the watersheds in Delaware, Maryland, New York, Pennsylvania, Virginia, West Virginia, and the District of Columbia that contribute phosphorous, nitrogen, and sediment to the Chesapeake Bay. As a result of the denial, the July 2015 ruling by the US Third Circuit Court of Appeals stands, which upheld EPA’s process for establishing and implementing total maximum daily loads (TMDLs) for the Chesapeake Bay. A TMDL is a tool used for achieving water quality standards. Under a TMDL for a given waterway, a limit is set on the maximum levels of pollutants allowed in that waterway and allocations are made to potential sources of the pollutants affecting the waterway.

It is expected that this blueprint will become the standard for other water-sheds with impaired waters, including the Mississippi watershed. A similar approach is being taken by EPA to set nitrogen and phosphorous limits in the Malibu Creek watershed in California.

Endangered Species
On February 11, 2016, the US Fish and Wildlife Service’s rulemaking on critical habitat became final expanding critical habitat designations to include areas in which a species no longer lives and areas where a listed species may live in the future. As more species are listed under the Endangered Species Act and as the definition of critical habitat is broadened to include areas where the species no longer lives or may live in the future, it becomes much more likely that any development project could be affected by federal or state concerns.

June 2016 RENDER | back