18 October 2018

Sidley Environmental Trends

Topics discussed this week include

  • Fifth Circuit allows possibility of injunctive relief for time-barred NSR claims.
  • Supreme Court denies cert. for two environmental cases.
  • Environmental groups challenge Oklahoma coal ash permitting scheme.
  • FERC-approved pipelines stopped as Commission nominee gets hearing.
  • PHMSA rescinds electronic braking rule for crude oil trains.

Fifth Circuit allows possibility of injunctive relief for time-barred NSR claims. The U.S. Court of Appeals for the Fifth Circuit will allow the United States to seek injunctive relief against Luminant Generation Company and Big Brown Power Company for alleged New Source Review violations even though the statute of limitations bars it from obtaining civil penalties. The United States alleged that the companies should have obtained a permit for work they performed at their coal-fired power plants, but the alleged modifications began more than five years before the government filed suit. The court held that the five-year statute of limitations began to run at the time of construction and rejected the United States’ argument that each day the plants operated without a permit was a new violation. However, in a 2-1 decision, the court also held that where the United States sues “in its sovereign capacity,” it may still obtain injunctive relief beyond the statute of limitations. Under the concurrent remedy doctrine, where a plaintiff is barred from obtaining civil penalties, it is also barred from obtaining injunctive relief. The Fifth Circuit held that the concurrent remedy doctrine would still apply to private parties but that a statute must specifically prohibit injunctive relief to apply the doctrine to the government.  Notwithstanding this ruling, the district court may still consider as a matter of equity whether the government’s delay and reliance should cause the court to not issue an injunction.

Supreme Court denies cert. for two environmental cases. The U.S. Supreme Court determined that it would decline to review a ruling that invalidated an Environmental Protection Agency (EPA) rule banning hydrofluorocarbons. Environmental groups and two companies sought review of a U.S. Court of Appeals for the District of Columbia Circuit decision vacating portions of a 2015 rule under Title VI of the Clean Air Act that prohibited the use of hydrofluorocarbons because they are greenhouse gases (GHGs). Title VI, the court ruled, gave EPA the power only to ban chemicals that deplete ozone, not because they are greenhouse gases. Because the hydrofluorocarbons subject to the rule had no ozone-depleting potential, EPA lacked the power under the Clean Air Act to ban them as GHGs. The Department of Justice urged the Supreme Court to deny certiorari, stating that the ruling below was correct.

Environmental groups challenge Oklahoma coal ash permitting scheme. Several environmental groups filed suit claiming that EPA approved Oklahoma’s coal ash permitting program without sufficient public participation and that a subsequent D.C. Circuit ruling vacating portions of EPA’s 2015 coal ash regulations undermined the foundation of Oklahoma’s program. Among the asserted defects of Oklahoma’s program is the claim that its coal ash permits do not expire and do not have to be amended to incorporate future changes in federal regulations and that the program would allow unlined coal ash impoundments to operate indefinitely. The complaint also alleges that the rule does not create minimum public participation guidelines for approved state programs that the plaintiffs claim are necessary under the Resource Conservation and Recovery Act.

FERC-approved pipeline stopped as Commission nominee gets hearing. The U.S. Court of Appeals for the Fourth Circuit recently issued a decision that will require developers to stop construction on certain aspects of the Mountain Valley Pipeline. The Fourth Circuit vacated Mountain Valley’s nationwide permit, issued by the U.S. Army Corps of Engineers (Corps) to cross waterbodies and wetlands. The court sided with environmental groups in finding that the Corps did not comply with conditions in the nationwide permit requiring a more detailed environmental analysis before it could be issued. Although the decision applied only to the pipeline’s route through West Virginia, a similar challenge regarding its route through Virginia was stayed pending the outcome of the Fourth Circuit challenge. The Corps suspended the company’s permit for stream and wetland crossings in Virginia, citing the Fourth Circuit’s decision. Mountain Valley is still cleared to build in upland areas not impacted by the ruling.  The litigation comes as the Senate Committee on Energy and Natural Resources is considering the nomination of Bernard McNamee, currently the Executive Director of the Office of Policy at the Department of Energy, to serve as a Commissioner. Although the Federal Energy Regulatory Commission (FERC) recently lacked a quorum as three of the five Commissioners’ terms expired, it is currently doing business with four Commissioners.

PHMSA rescinds electronic braking rule for crude oil trains. The Pipeline and Hazardous Materials Safety Administration (PHMSA) rescinded a rulemaking that required railroad companies transporting crude oil to install electronically controlled pneumatic brakes. PHMSA implemented the braking rule after the Fixing America’s Surface Transportation Act of 2015 required the agency to study the use of electronically controlled pneumatic braking systems to determine if they could reduce the frequency or severity of accidents. It issued a rule mandating their use in 2015 without permitting public notice and comment, asserting that public input was unnecessary and contrary to the public interest. The rule mandated companies to phase in the braking systems between 2021 or 2023, depending on the type of liquids being carried. In rescinding the requirement, however, PHMSA stated that a new analysis showed that the costs imposed by the braking requirements would not yield any significant benefits by averting or minimizing accidents.

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