Articles Posted in Energy

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On May 15, the U.S. District Court for the Northern District of California held that the City of Oakland’s attempt to apply a new “coal ban” ordinance to a coal handling terminal was invalid. The District Court concluded that the record evidence placed before the City Council did not satisfy the ”substantial evidence” criteria contained in the development agreement entered into by the City and Oakland Bulk & Oversized Terminal (“OBOT”) governing a bulk cargo shipping terminal to be built and operated by OBOT. The case is Oakland Bulk & Oversized Terminal, LLC v. City of Oakland.

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On May 9, the California Energy Commission announced that it has “adopted building standards that require solar photovoltaic systems starting in 2020.” The 2019 Building Energy Efficiency Standards are expected to “reduce greenhouse gas emissions by an amount equivalent to taking 115,000 fossil fuel cars off the road.”  California will be the first in the nation to require solar. The new standards take effect on January 1, 2020.

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Section 40416 of the Bipartisan Budget Act of 2018 temporarily reinstates the Oil Spill Liability Tax that expired on December 31, 2017 for the period beginning on March 1, 2018 through December 31, 2018. Section 4611 of the Internal Revenue Code has, for many years, imposed a tax of $0.09 cents per barrel on crude oil received at a refinery, and on petroleum products entered into the U.S. for consumption, use, or warehousing.

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On April 9, 2018, the heads of twelve Federal agencies and departments entered into a Memorandum of Understanding (“MOU”) committing their respective agencies to implement certain concepts and directives from Executive Order (“EO”) 13807,[1] the Trump administration’s effort to streamline environmental review and approval of major infrastructure projects. The signatory agencies are the Departments of the Interior, Agriculture, Commerce, Housing and Urban Development, Transportation, Energy, and Homeland Security, the Environmental Protection Agency, Army Corps of Engineers, Federal Energy Regulatory Commission (“FERC”), Advisory Council on Historic Preservation, as well as the Federal Permitting Improvement Steering Council. These agencies frequently are involved in large-scale, complex infrastructure projects, such as traditional and renewable energy facilities and interstate pipelines; highway and bridge improvements, and transportation projects. While much of the MOU recites requirements previously set forth in the EO, it adds details and deadlines regarding interagency coordination, communication and dispute resolution in order to carry out the EO’s “One Federal Decision” concept and the goal of completing environmental review under the National Environmental Policy Act (“NEPA”) within two years.

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Recently, our colleagues Rob James and Stella Pulman co-authored Getting the Deal Through: Gas Regulation 2018, in which they describe the domestic natural gas sector, including the natural gas production, liquefied natural gas (LNG) storage, pipeline transportation, distribution, commodity sales and trading segments and retail sales and usage.

Reproduced with permission from Law Business Research Ltd. Getting the Deal Through: Gas Regulation 2018 (published in March 2018; contributing editors: David Tennant and Adam Brown of Dentons UKMEALLP). For further information, click here.

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Public discourse regarding climate change is becoming focused less on whether it is occurring, and more on what society can and should do to address or slow its progression. Geoengineering, which involves deliberately modifying the earth’s climate, is gaining traction in the scientific community and may prove to be a useful tool in the future. However, as with many emerging technologies, the legal system is not designed to regulate geoengineering research and testing activities, much less widescale deployment.

In an article recently published in Pratt’s Energy Law Report, Pillsbury partners Norman Carlin and Rob James offer their suggestions on how domestic law can be navigated effectively to facilitate the research of geoengineering technologies.

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On March 12, the U.S. Court of Appeals for the Second Circuit issued a decision interpreting Clean Water Act (CWA) Section 401 and the Federal Regulatory Energy Commission’s (FERC) permitting authority, which may have settled some lingering legal issues for the construction of pipelines. The case is New York State Department of Environmental conservation, et al., v. FERC.

The Second Circuit considered two issues:

  1. Whether FERC correctly held that NYSDEC waived its right to act on Millennium Pipeline Company’s (Millennium) application; and
  2. Whether FERC appropriate accepted and reviewed the application as subject to its exclusive jurisdiction under the Natural Gas Act.

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On December 22, 2017, the Office of the Solicitor of the Department of the Interior issued a  Memorandum re: The Migratory Bird Treaty Act Does Not Prohibit Incidental Take, which substantially modifies the Department’s policy regarding the criminal enforcement of the Migratory Bird Treaty Act’s (MBTA) prohibition against the incidental taking or killing of migratory birds. In addition, this Memorandum withdraws a contrary opinion of the Solicitor’s Office that was issued on January 10, 2017 – Memorandum re: Temporary Suspension of Certain Solicitor M-Opinions Pending Review. This could be a very important change for the energy industry.

The opinion concludes by stating that:

“The text, history and purpose of the MTBA demonstrate that it is a law limited in relevant part to affirmative and purposeful actions, such as hunting and poaching, that reduce migratory birds and their nests and eggs, by killing or capturing, to human control… Interpreting the MTBA to criminalize incidental takings raises serious due process concerns and is contrary to the fundamental principal that ambiguity in criminal statutes must be resolved in favor of defendants.” Continue reading

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Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), commonly referred to as Superfund, was enacted in December 1980, and Section 108(b) provides that the Environmental Protection Agency (EPA) shall promulgate, no later than December 11, 1985, financial responsibility requirements for classes of facilities—designated by EPA—consistent with “the degree and duration of risk associated with their production, transportation, treatment, storage or disposal of hazardous substances.” Despite this directive, EPA has not issued any financial responsibility rules under Section 108(b). This record of inaction prompted a lawsuit demanding compliance with the law.

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On November 20, the U.S. Court of Appeals for the Fourth Circuit decided the case of Cox, et al., v. Duke Energy, Inc. et al., affirming the ruling of the U.S. District Court for the District of South Carolina’s grant of the defendants’ motion for summary judgment in a 42 U.S.C. § 1983 civil rights lawsuit, holding

“(1) that Fleming had validly waived his right to sue the Darlington County Sheriff’s Office, the Sheriff, and the deputies; (2) that Duke Energy and its vice president were private actors not operating “under color of” state law as required for liability under § 1983; and (3) that Fleming’s remaining state law claims were preempted by federal law’s exclusive regulation of nuclear safety.”

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