Winston’s Environmental Law Update

A recent decision by the Supreme Court of the United States—to deny requests from states and industry groups to stay enforcement of the EPA’s rulemaking on methane and volatile organic compound (VOC) emissions—was deemed a success by the EPA in its efforts to curb emissions from the oil and gas industry.

On September 27, 2024, California Governor Gavin Newsom signed into law amendments to California’s first-in-the-nation greenhouse gas emissions disclosure and climate-related financial risk reporting bills. The amendments did not delay the reporting deadlines applicable to reporting entities, and companies should take action now to ensure they will be ready to report on 2025 emissions and risks starting in 2026.

On April 17, 2024, the Assistant Administrator for U.S. Environmental Protection Agency’s (EPA) Office of Enforcement and Compliance Assurance (OECA) issued a new Strategic Civil-Criminal Enforcement Policy (the Policy). The Policy requires enhanced civil and criminal enforcement coordination, both on a case-by-case basis and through regular institutional measures. EPA is now requiring civil and criminal coordination during the entire lifespan of a case. The Policy became effective immediately.

On October 7, 2023, California Governor Gavin Newsom signed SB 261, the Climate-Related Financial Risk Act, and SB 253, the Climate Corporate Data Accountability Act, into law. These first-in-the-nation greenhouse gas (GHG) emissions disclosure and climate-related financial risk reporting laws apply to large companies “doing business” in California.

The Environmental Protection Agency (EPA) announced that climate change and PFAS will be a focus of investigation and enforcement in coming years. The oil and gas, chemical, and waste-related industries should take note. EPA’s national enforcement and compliance initiatives (NECIs) for fiscal years 2024-2027,^[1]announced on August 17, 2023, include climate change, PFAS, and coal ash contamination among six priority areas for enforcement. EPA will also continue to prioritize reducing air toxics in overburdened communities, increasing compliance with drinking water standards, and chemical accident risk reduction.

The U.S. Environmental Protection Agency (EPA) recently proposed three key actions to further regulate ethylene oxide (EtO) under the Clean Air Act and the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA). EPA’s latest proposals include (1) stricter national emission standards for hazardous air pollutants (NESHAP) for commercial sterilization facilities, (2) new Clean Air Act rules for plants that make synthetic organic chemicals and plants that make a variety of polymers and resins, and (3) more stringent standards for workplaces handling EtO. We provide an overview of these proposed actions and what they may mean for your business.

As of February 13, 2023, ASTM 1527-21 will meet the AAI requirement, and thus will become the relevant standard for conducting Phase Is. Phase Is conducted using the 2013 Standard will no longer be compliant with the AAI requirement after December 15, 2023. Users of Phase Is should update internal guidance or scopes of work with environmental professionals to confirm (1) reports are completed to the new standard beginning in February 2023 and (2) whether emerging contaminations, including PFAS, should be included in the property evaluation as a “non-scope consideration.”

The Environmental Protection Agency (EPA) has announced its proposed National Enforcement and Compliance Initiatives (NECIs) for fiscal years 2024–2027. EPA is proposing to add two new areas of enforcement focus: mitigating climate change and addressing per- and polyfluoroalkyl substances (PFAS) contamination. Those operating in the oil and gas industry, and those involved with refrigerants, should take note. Interested parties have until March 13, 2023 to submit comments to EPA on the proposed changes.

The Biden Administration has started 2023 with a jammed pipeline of major regulatory actions relating to climate and other major environmental matters. For those interested in participating in the public comment processes, the clock is ticking. Here is a rundown of impending deadlines for public comment for some of the most significant rulemakings from the EPA and other federal agencies.

The United States Environmental Protection Agency and Army Corps of Engineers (the Agencies) closed out 2022 by announcing a final rule that establishes a new definition of “waters of the United States” (WOTUS) for implementation of the Clean Water Act.[1]  The Agencies, which previously indicated there would be a two-step regulatory process to defining WOTUS, appear to be proclaiming this to be its “durable” revision for the long term.  But will this definition of WOTUS get washed away like its predecessors?  

On June 15, 2022, the U.S. Environmental Protection Agency (EPA) announced new drinking water Health Advisories Levels (HALs) for certain per- and polyfluoroalkyl substances (PFAS) as part of its PFAS Strategic Roadmap.

The Supreme Court held the Environmental Protection Agency cannot establish a standard of performance for existing electric generating sources under Section 111(d) of the Clean Air Act based on a system of generation shifting like that developed for the Clean Power Plan. As a result, EPA’s Affordable Clean Energy Rule of 2019 could come back in effect…for now.

The United States Department of Justice, Environment & Natural Resources Division (ENRD), recently released its Accomplishment Report for FY 2021. This report “highlights ENRD’s strong enforcement of our nation’s environmental and natural resources laws, efforts to advance environmental justice and role in our nation’s response to the climate crisis.”^[1]

The Securities and Exchange Commission is working on new regulations. These would mandate climate-related and other Environmental, Social, and Governance disclosures. Onlookers still don’t know when they’ll see a proposed rule from the SEC. However, Chairman Gensler recently tweeted clues on what regulated entities should expect.

Deputy Attorney General Lisa Monaco recently said that the Department of Justice intends to “strengthen the way” that DOJ “respond[s] to corporate crime.” DAG Monaco’s speech and memorandum has important implications for environmental enforcement, including for companies making Environmental, Social and Governance (“ESG”) claims and disclosures.  Monaco specified “three actions” changing prior DOJ policies.

EPA is claiming expansive authority to use the Toxic Substances Control Act (TSCA) to regulate more than just chemical substances and mixtures. EPA’s Assistant Administrator recently said, “Generally speaking, articles are manufactured goods or finished products – and the chemicals in them ARE subject to TSCA.” Taken literally, this represents a significant expansion of EPA’s regulatory authority under TSCA.

The chemical and health care industries know that more stringent EPA regulation of the manufacture and use of ethylene oxide (EtO) is coming.

A dozen state attorneys general — led by California and New York — are calling on the SEC to mandate broad ESG disclosures for climate-related financial risks.