Climate Change Blog | McCarter & English

DC Court Decision Raises New Questions on EPA Authority

July 30, 2008 16:34
Two important climate change law developments collided this month in unexpected ways that impact whether the U.S. Environmental Protection Agency can and will regulate greenhouse gas emissions (GHGs) pursuant to the federal Clean Air Act and, legal observers say, the resulting unintended consequence compels the conclusion that the Congress needs to act now to adopt a legislative fix. First, in a Federal Register notice published on July 30, 2008 (but released informally on July 11, 2008), the EPA issued its Advance Notice of Proposed Rulemaking (ANPR) that responds to the U.S. Supreme Court’s...


From Auctioning Art to Auctioning Carbon Dioxide Emission Allowances

July 25, 2008 02:09
By Grace Kurdian, McCarter & English, New York City How far we've moved from the days when an auction simply conjured images of art trades at venerable art houses. Yesterday, the Regional Greenhouse Gas Initiative ("RGGI") released the bid preparation process (notice, qualification documents and background information concerning the auction process) for the first regional, mandatory, market-based carbon emissions auction to be held in the nation. The first RGGI auction of carbon dioxide allowances will be held on September 25, 2008. A second auction is planned for December of 2008. The au...


Renewable Energy Resources at Risk from Climate Change: Property Insurance - the Prelude - Part II

July 14, 2008 04:01
by J. Wylie Donald
Our neighboring county just revised their zoning ordinance forbidding auxiliary structures higher than 15 feet. The revision permits structures up to 150 feet. The need: windmills. What if we got one? What about insurance? My first step was to consider the risks and losses I would need to protect against: property loss (it falls down), liability (it falls down on somebody) and business interruption. (I can no longer export power). As it turns out, only the third is of any real interest, but in so being it impacts the other two. If you pull out your homeowners' policy, it will likely cover ...


Renewable Energy Resources at Risk from Climate Change: Property Insurance - the Prelude

July 2, 2008 16:16
by J. Wylie Donald
An article in the New York Times on July 1, 2008, by Jad Mouawad, titled Weather Risks Cloud Promise of Biofuel, points out that renewable energy sources could be especially susceptible to weather conditions because they often depend on fragile crops, which while renewable, also can be wiped out in one swift stroke.  Those crops can be regrown, of course, but that takes time.  Further, these energy sources are usually found above ground, in places exposed to weather.  Although the article focuses on the effect of the recent flooding in the Midwest of the United States and along ...


Georgia State Judge Rejects Coal Power Plant, Citing CO2 Emission Issues

July 1, 2008 17:26
A Georgia Court Monday reversed that state’s issuance of an air permit to the developer of a 1,200 MW coal fired power plant, citing the permit’s failure to require carbon dioxide emission limitations under the Clean Air Act (“CAA”). An administrative law judge’s decision to issue the permit was reversed and remanded for further proceedings. At issue in the case is a proposal for a conventional coal burning steam electric power plant that would be a major air pollution source, emitting 8-9 million tons of carbon dioxide per year, along with sulfur oxides, nitrogen oxides, particular matter, s...


Problems in Iowa: Working Around the Flood Exclusion

June 30, 2008 17:26
by J. Wylie Donald
One of the great battles that will be fought out in the next several decades is who will bear the costs of climate change. One target will be insurance companies, who have borne and continue to bear the costs of asbestos (formerly thought of as a "miracle mineral") and the cleanup of environmental pollution (many sites of which were permitted disposal sites or were the result of compliance with customary and even recommended practices).  These losses have been found covered by insurance by numerous courts, notwithstanding insurer arguments that the losses were never intended to be covered...


Federal Appeals Court Rejects Deadline Claim for EPA Endangerment Finding

June 28, 2008 08:00
The U.S. Court of Appeals for the District of Columbia Circuit declined this week to order the U.S. Environmental Protection Agency (EPA) to complete its review within 60 days concerning the public health impact of greenhouse gas emissions (GHGs) from new motor vehicle exhaust. In denying the request of Massachusetts and 16 other states and environmental groups, the Appellate Court on June 26, 2008 left EPA to continue to move at its own pace in responding to the April 2007 landmark decision of the U.S. Supreme Court in the case known as Massachusetts v. EPA. 127 S. Ct. 1438 (2007). In Massa...


Carbon Dioxide - Irritant or Contaminant? - Application of the Absolute Pollution Exclusion (Part 1)

June 27, 2008 13:34
by J. Wylie Donald
The question remains whether the absolute pollution exclusion, the most typical pollution exclusion found in CGL policies today, would bar coverage for climate-change related liabilities associated with the release of carbon dioxide; in other words, whether carbon dioxide would qualify as a “pollutant” as defined in a typical absolute pollution exclusion. The so-called absolute pollution exclusion purports to bar coverage for property damage or bodily injury only if it arises out the release of a “pollutant,” which is generally defined as an “irritant,” or “contaminant.”  As those terms ...


Carbon Dioxide - Ubiquitous and Anonymous - Essential Preliminaries to Application of the Absolute Pollution Exclusion

June 13, 2008 03:44
by J. Wylie Donald
Although the U.S. Supreme Court's foray into the area of carbon dioxide emission regulation, Massachusetts v. EPA, garnered significant media attention, for liability purposes corporations and their insurance companies are paying attention to a different type of case: claims alleging injury arising from certain industries' emissions of carbon dioxide. These claims raise the issue of whether commercial general liability (CGL) policies will cover the defense and indemnification costs incurred in defending, settling, and, perhaps, paying judgments on these lawsuits. Thus, insurance coverage is an...


CT adopts law setting greenhouse gas reduction mandates

June 11, 2008 08:43
The Connecticut General Assembly adopted a bill, which Gov. M. Jodi Rell (R) signed into law earlier this month, that sets mandatory greenhouse gas emission reduction requirements to 10 percent below 1990 levels by 2020 and 80 percent below 2001 levels by 2050.  The law broadens the authority of Connecticut’s Commissioner of Environmental Protection (“DEP”) and other state agencies to take regulatory, policy and strategic actions necessary to ensure compliance with the mandates and authorizes cooperation with other states beyond the Regional Greenhouse Gas Initiative (“RGGI”), including...



The business case for the development of renewable energy projects, from biodiesel and ethanol to wind, solar, and distributed generation, is more compelling than ever as tax and regulatory incentives combine to attract investments. Emerging issues in environmental law and increasingly recognized principles of corporate social responsibility are encouraging public companies to voluntarily reduce greenhouse gas emissions, install clean energy alternatives, and invest overseas in projects under the Kyoto Protocol to respond to climate change concerns.

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