Wednesday, July 31, 2013
Island Press is running a special summer promotion on a number of excellent environmental e-books, including Professor Roy Gardner's book Lawyers, Swamps, and Money: U.S. Wetland Law, Policy, and Politics, which I have previously blogged about here. Along with more than 500 other e-books, it will be discounted to $4.99 until August 5. If interested, visit www.islandpress.org (with code SALE), Amazon, Barnes & Noble, Apple, or Kobo stores.
- Blake Hudson
Friday, July 26, 2013
Whatever term you choose to describe the technique, hydraulic fracturing and horizontal drilling of oil and gas wells continues at a fast pace. The law, too, is quickly changing. If you're teaching or writing in this area this fall, I've listed some of my favorite resources below. Some of these aren't so new--they're just helpful (I think). This post describes sources associated with unconventional oil and gas development generally--not just fracturing, which is one stage within a larger development process.
The relevant formations: Much of the oil and gas produced in the United States comes from unconventional oil and gas formations -- defined by Q.R. Passey et al. as “hydrocarbon-bearing formations and reservoir types that generally do not produce economic rates of hydrocarbons without stimulation"--meaning that something more than drilling is required. These formations include coalbeds, tight sandstones, and shales, but shales contain the most abundant hydrocarbons. This oil and gas comes from organic matter that was deposited "along the margins of lakes or seas" millions of years ago. The quantity and type of oil and gas formed from this organic matter depends on a number of factors, including the type of organic matter deposited and the quantity of sunlight and nutrients it had; the rate and amount of organic matter destruction by microbes, oxidation, and other processes; and the mixing and diluting of this organic matter with other substances as sediment built up and the matter was trapped within rocks. Heat and the maturity of the organic matter and rock are also important: in most gas-containing shales, geologists would normally expect to see oil due to the type of organic matter there, but the shales are "mature" and were subjected to high heat, producing residual gas trapped within the rocks. All of the above is a summary of Q.R. Passey et al.'s work, which does a much more accurate job of explaining the oil and gas production process.
How much gas and oil?: The Energy Information Administration has a helpful report on global shale gas and oil reserves. The Energy Information Administration projects a "44-percent increase in total natural gas production from 2011 through 2040" in the United States due largely to unconventional resources. Several liquefied natural gas export terminals are proposed. The Federal Energy Regulatory Commission has approved the Cheniere/Sabine Pass LNG terminal in Louisiana, and the facility website indicates that the terminal will be "capable of liquefying and exporting natural gas in addition to importing and regasifying foreign-sourced LNG." The project is still under construction.
The technology: It's not only fracturing that has caused domestic oil and natural gas production to rise dramatically. There are three key changes that contributed to the modern boom. First, wells that will eventually be fractured are often drilled with a horizontal drilling technique--drilling vertically down to a formation (sometimes as far as 12,000 feet--see this Halliburton document for various formation depths) and then laterally through the formation to expose more surface area, and thus more oil and gas. Often, the portion of the formation targeted is quite narrow--often less than one meter thick, for example.
Second, hydraulic fracturing is a key technology, but it has (as industry notes) been around for a long time. Depending on how you parse terms, you could trace it back to the 1800s, when companies used nitroglycerin to break up underground formations. The technique has, of course, changed quite a bit since then. The fracturing used from about 1949 and on tended to use very heavy gels and large quantities of proppant (sand) to prop open fractures when they were formed. Other older fracs used mostly water. But what really changed in the late 1990s was the use of water (lots of it) combined with some chemicals, in a sort of hybrid of the earlier gel and water techniques. Energy companies, with government support, developed this slickwater fracturing technique in Texas's Barnett Shale--and more recently transferred it to other formations. The water, injected at very high pressure down a well, rushes out of the perforated portions of the well and forms fractures in the formation around those portions. Acid injected before the water can also help form fractures.The third key technological component is the use of multiple, staged, fractures along one wellbore. Fracturing companies separate the well into different intervals (think of "compartments" within the horizontal well) using equipment called packers. The companies fracture each interval, which greatly enhances well production.
The regulation: I've written earlier posts about federal exemptions for oil and gas and fracturing. These exemptions, and tradition, leave much responsibility to the states, municipalities, and regional governments. But the regulation of oil and gas development is very much in flux.
Federal: As of January 1, 2015, onshore gas companies will have to capture the volatile organic compounds emitted from the well and the flowback water that comes out of the well after fracturing.This will greatly reduce methane emissions. The EPA is also writing standards that require the treatment of flowback water and salty waters naturally produced from the well; it appears that these standards will apply to direct discharges to water and indirect discharges to a publicly owned treatment works. The EPA initially suggested that it would require disclosure of the chemicals used in fracturing under the Toxic Substances Control Act, but not it appears that it will simply aggregate information disclosed at the state level. Finally, the EPA is drafting Safe Drinking Water Act permitting guidance for hydraulic fracturing that uses diesel fuels, and the BLM has issued several versions of draft rules for fracturing on federal lands.
In terms of studies, the EPA had concluded in a draft report that fracturing in an unusually shallow zone contaminated groundwater in Pavillion, Wyoming, but industry has criticized the study, and the EPA recently passed control over continued study to the State of Wyoming. The EPA's nationwide study of the impacts of fracturing on groundwater is ongoing; the most recent release was a lengthy progress report. The U.S. Geological Survey is conducting a broad-based water quality study in regions where there is drilling and fracturing. One USGS study in Arkansas found no impacts on water quality from "gas-production activities." The EPA is also investigating how to control induced seismicity issues caused by Class II underground injection control wells for oil and gas wastes, although it has not yet revised the Safe Drinking Water Act to address the problem. Finally, the DOE's Shale Gas Production Subcommittee produced a report with recommendations for generally improving regulation of shale gas development.
The Fish and Wildlife Service has also begun to be more active in this area. On July 18, 2013, it issued a final rule listing the diamond darter--a species in the Marcellus Shale region--as endangered.State: State regulation continues to change quickly, with Nebraska being one of the most recent states to propose required disclosure of fracturing chemicals. In January 2013, Mississippi approved rules requiring that surface casing (steel lining cemented into the well) extend 100 feet below groundwater, and the rules also require chemical disclosure. In 2012, Utah enacted new rules requiring chemical disclosure and that wells be pressure tested before drilling and fracturing (thus helping to verify that the wells can withstand the high pressures of fracturing), among other protections. Also in 2012, Colorado implemented requirements for testing of water quality prior to drilling and fracturing (requiring testing of a maximum of four water sources around each well) and made other changes. Further, Ohio enacted SB 315 and SB 165 (2012), and West Virginia enacted HB 401 (2011), all of which modify oil and gas development rules. Over the past few years, Arkansas, Montana, and other states also have changed their rules to address fracturing. For some recent summaries of state regulations, see Resources for the Future's The State of State Shale Gas Regulation and its Shale Maps; summaries and a report from the National Conference of State Legislatures; and American Law and Jurisprudence on Fracing by Haynes Boone.
Local and state: The Pennsylvania Supreme Court has still not issued an opinion regarding the constitutionality of Act 13, which required municipalities to allow drilling and fracturing in nearly all zones and allowed them to impose a fee on unconventional gas wells. A commonwealth Court in Robinson Twp. v. Commonwealth, 52 A.3d 463 (Pa. Cmwlth. 2012) struck down portions of the Act as unconstitutional, finding that it was a substantive due process violation to require municipalities to accept this industrial activity in most zones. In Anschutz Exploration Corp. v. Town of Dryden, 35 Misc.3d 450 (N.Y. Sup., 2012), and Cooperstown Holstein Corp. v. Town of Middlefield, 106 A.D.3d 1170 (N.Y.A.D. 3 Dept. 2013), New York trial courts determined that despite state language preempting laws "relating to the regulation of oil and gas," towns may use their land use authority to prohibit natural gas development. A West Virginia court, on the other hand, found Morgantown's hydraulic fracturing ban preempted because of the relatively comprehensive (but not directly preemptive) state oil and gas law. See Northeast Natural Energy LLC v. City of Morgantown, Civil Action No. 11-C-411 (W. Va. Circuit Court 2011). In Colorado, where the citizens of Longmont banned hydraulic fracturing, the Colorado Oil and Gas Association made a similar argument against the ban--essentially arguing that Colorado's oil and gas rules occupy the field. The state's Oil and Gas Conservation Commission was reportedly recently joined in the suit.
Industry best practices and recommended state regulations: The State Review of Oil and Natural Gas Environmental Regulations has guidelines for how states should regulate drilling fracturing, which are voluntary. If states agree, STRONGER reviews state programs for compliance with these guidelines. The American Petroleum Institute also has a number of suggested best practices for hydraulic fracturing, and industry and environmental groups have proposed fifteen performance standards through the Center for Sustainable Shale Development.
Courts: Go here to see Columbia Law School's digest of hydraulic fracturing cases and here for Arnold and Porter's chart of hydraulic fracturing cases. In 2008, the Texas Supreme Court in Coastal Oil v. Garza, which held that an individual could not recover trespass damages for the drainage of natural gas caused by fractures that extended into a mineral estate, but a federal district court in the West Virginia case of Stone v. Chesapeake Appalachia, 2013 WL 2097397 (N.D. W.Va. 2013), recently disagreed, finding, in denying summary judgment to defendants:
"[T]his Court finds, and believes that the West Virginia Supreme Court of Appeals would find, that hydraulic fracturing under the land of a neighboring property without that party's consent is not protected by the “rule of capture,” but rather constitutes an actionable trespass."
There's also a split among district courts (and possibly circuit courts) on whether the Migratory Bird Treaty Act requires some sort of action directed at a bird in order for the actor to be liable. When birds dies in North Dakota Bakken Shale waste pits, the federal district court found that this was not enough to make the oil company liable for a "take": "The terms “take” and “kill” as found in . . . the Migratory Bird Treaty Act are action verbs that generally denote intentional behavior." See U.S. v. Brigham Oil and Gas, L.P., 840 F.Supp.2d 1202, 1212 (D.N.D. 2012). The U.S. District Court for the Southern District of Texas, on the other hand, found that "[i]f an operator who maintains a tank or pit does not take protective measures necessary to prevent harm to birds, the operator may incur liability under federal and state wildlife protection laws," including the MBTA. United States v. Citgo Petroleum Corp., 893 F.Supp.2d 841, 847 (S.D. Tex. 2012).
Science: Recent and semi-recent papers have been released that further describe the links between Class II underground injection control wells and induced seismicity, including in Dallas and Fort Worth, Texas, Oklahoma, and Ohio. Nathaniel Warner and other authors who published an earlier study on potential methane migration from Marcellus Shale wells published a more recent paper exploring brine in shallow aquifers. D.J. Rozell and S.J. Reaven also have a good paper addressing "five pathways of water contamination: transportation spills, well casing leaks, leaks through fractured rock, drilling site discharge, and wastewater disposal." For those looking for an overall summary of potential environmental impacts, the National Park Service produced a useful document in 2008.
With respect to climate, MIT researchers published an interesting (and potentially disturbing) report suggesting that cheap gas threatens to substantially delay technologies like carbon capture and storage. The International Energy Agency's "Golden Age of Gas" report also warns that gas alone will not lead to a goal of stabilizing average global temperature increases to 2 degrees Celsius. Natural gas displaced coal in U.S. electricity generation in 2012, and domestic greenhouse gas emissions dropped, but in 2013, natural gas use in generation has declined from 2012 highs. And with respect to methane leakage associated with natural gas production, for a good comparison of estimates see Jeff Tollefson's article in Nature.
Social impacts: For a report on gas attracting chemical companies and manufacturers to the United States, see this American Chemistry Council document. For impacts on local economies, Penn State has a number of good sources. And for interesting numbers showing the strain on infrastructure and services created by a booming oil or gas economy, see Williston, North Dakota's Impact Statement.
And if you haven't fallen asleep yet from this post, see also Gregg Macey's recent "Fracking Fatigue" post for great sources, commentary, and research ideas. A post on recent fracturing scholarship and theory would be almost as long as this one--I'll save it for another day.
Friday, July 19, 2013
Each year, when the thaw sets in the Himalyan Valley of Uttarakhand, piligrims flock to the holy temples in the region, such as Kedarnath. This year was no different. Except, the holy shrine of Kedarnath, which is over thousand years old, turned into a grave site with bodies piled up around its structure. The cause: unprecedented flash floods that have devastated the region. Hundreds have died and nearly 6,000 people are missing. An online search engine of “Uttarakhand” will provide several news reports and op-eds on the scale of the devastation. The big question is what caused the floods? It is unclear. The Government of India has set up a committee to do a post-mortem. In the meantime, let us assume that global warming may be one reason, since scientists have predicted these kinds of sudden weather changes as a consequence of climate change. What this catastrophe then illustrates is the vulnerability of people living in nations such as India (and no doubt elsewhere, too).
Since the floods occurred suddenly, there was no room to warn or evacuate before the floods and the ensuing landslides occurred. People were stranded in dangerous terrains in a region that is already difficult to access. As roads and houses collapsed into the water, hundreds were drowned and thousands stranded. The Indian Army’s rescue operations were greatly impeded by unexpected rainfall. Neither prevention nor effective rescue was possible.
For locals in the region, this human tragedy is marked by huge economic loss, as well. Tourism (and hydroelectricity) is a major source of income. The floods hit the region during peak tourist season, causing significant loss of income. The only hope is that the reconstruction process will create jobs, but the human cost at which this may occur makes it a small consolation.
The floods also illustrate the difficulty facing countries such as India in adapting to climate change to avert catastrophic consequences. Thousands of people have to be re-located and buildings re-built. In a region where seasonal tourism or hydro electric power are key sources of income, the cost of such measures may outweigh the risks, at least in the short term. If re-location within the region is not possible, then the question is whether people can be absorbed into other regions. Such a move could also trigger economic concerns, such as finding employment for those re-located.
Any inadequate adaptation action, especially when combined with unsatisfactory rescue operations could chill travel, if such events increase, and result in people staying put. This will doubly affect the local population, who will lose their source of income even as they become increasingly vulnerable to climate change consequences. At that point, no legal intervention can possibly ensure that those affected receive proportionate remedies.
Uttarakhand should serve as a wake up call. To ensure that justice, even considered in the loosest sense, is denied to people such as those affected in Uttarkhand, a proper action plan on climate change is urgently needed. Finger pointing will not resurrect the dead.
Thursday, July 18, 2013
You can use the tool/view the images here. Here is what the tool is:
"Since the 1970s, NASA and the U.S. Geological Survey have been amassing satellite images of every inch of our planet as part of the Landsat program. Over time, the images reveal a record of change: of cities expanding, lakes and forests disappearing, new islands emerging from the sea off the coast of rising Middle East metropolises like Dubai."
There is a tool at this site that allows you to "zoom in to any spot on the planet – your hometown, the Amazon, your favorite Chinese mega-city – and watch the same three-decade timelapse unroll. Good luck getting anything done for the rest of the day."
Indeed, compare the images below of my hometown of Baton Rouge, Louisiana in 1984 and 2012.
I have previously blogged/halfway joked about humans behaving as a virus. But spending a little time on this site makes that perspective a little less funny.
- Blake Hudson
Monday, July 15, 2013
Last Thursday, at the Economics Institute for Law Professors (which I earlier discussed here), Terry Anderson of the Property and Environment Research Center gave a fantastic presentation on "free market environmentalism." Anderson admitted that this was somewhat of an unfortunate phrase as it signals an open-ended, silver bullet market-driven approach to environmental protection. But the basic premise of this type of environmentalism is that markets harnessing property rights can provide protections for the environment above and beyond what government would be able to accomplish through regulation. And indeed, Anderson highlighted numerous compelling examples where regulatory intervention led to environmentally destructive unintended consequences, whereas environmental gains would have been achieved if markets had been allowed to work freely.
But another point of Anderson's talk, at least in my interpretation, is that under many (if not most) circumstances, rather than "destroying wealth" of property owners through regulation that prohibits them from using their environmental resources (through, say, creating pollution or engaging in potentially unsustainable extractive activities), we should just pay them not to pollute or not to unsustainably extract. And, of course, there are many examples of successful policies based on paying landowners to preserve positive externalities.
During the talk, however, an interesting point was raised. A professor made the point that she was having a hard time reconciling the view of property rights whereby markets can efficiently resolve all conflicts with the history of slavery in the U.S. In other words, pure markets likely would have perpetuated slavery since in the absence of "wealth destroying" regulations on slave-owner property rights we would have had to rely on the federal government or others opposed to slavery to make it more profitable for slave-owners to sell slaves (who would then be freed by the purchaser) than to retain slaves. First, of course, the pure economics of this potential "transaction" (which Anderson admitted was a cold and calculating way to engage in this discussion, and he handled the whole difficult conversation with great sensitivity) would weigh heavily in favor of perpetuating slavery because the abolitionists would have had an incredibly difficult time raising the capital required to free all of the slaves. Second, and far more importantly, the pure economic, market analysis says nothing of the injustice or the lack of morality of slavery. Slave abolition, or "wealth destroying" regulation (or the fact that we went to war over the issue), on the other hand, made a definitive normative statement about the morality of slavery. Abolition said that we as a society - as a collective - believe slavery is wrong and notwithstanding very real (but ultimately artificially created) property interests and technical "wealth destruction" aimed at slave owners we will no longer accept the practice.
By way of example, and looking again through the cold and calculating lens of property rights (though unjust), consider the technical values citizens in 1863 gave to slaves in my home county in Alabama, as depicted in the following image:
Compare the estimated value of land, at roughly $1.9 million, with the estimated value of slaves, at roughly $3.5 million. Thus, when looked at through a pure property perspective, Anderson described that regulatory abolition of slavery technically destroyed a great amount of wealth for some property owners, the slave owners, and redistributed it to other, new "property" owners, the slaves (where the property in question was freedom from slavery). Of course, Anderson highlighted that the moral case against slavery justified for American citizens the destruction of wealth for some and its redistribution to others. The moral case demanded this approach, whereas a pure economic, market-driven approach may have supported another approach in the form of purchasing slaves and freeing them.
The difficulty this posed to me in assessing Anderson's presentation is that it is difficult to see how the logic of environmental regulation is different. Let me be clear, human rights and slavery should be a far higher priority than clean air or water - because without basic human dignity and civil rights the environment we live in cannot be protected or at least cannot be protected through credible government action (how can a government protect the environment without first protecting the rights of its citizens?). Nonetheless, why should we under all circumstances pay others not to pollute or unsustainably extract? Is there a moral case that in some circumstances landowners should be prevented from doing so, and should not be paid as a result? While I am actually quite in favor of environmental markets, promotion of ecosystem service markets, and the internalization of environmental externalities that have long been excluded from the market (and am also a rural forestland property owner), I also believe that there are some circumstances where regulatory limits are the most effective means, and the normative, morally correct approach, to balancing private rights with the public interest. I have discussed this in a historical, descriptive context here. Take, for example, an urban growth boundary aimed at preventing urban sprawl, even though a landowner on the outside of the boundary now maintains property worth $1,000 an acre while a property owner just inside the boundary maintains property worth $10,000 an acre. Perhaps some short-term economic wealth is destroyed for the property owner outside the boundary, but long-term wealth is gained by society at large and future generations (in the form of access to natural capital like forests, wetlands, open space, and biodiversity and also in the form of reduced air and water pollution and a variety of other environmental harms).
This was largely the point of Leopold's "land ethic," that the rights and ethics that have been extended to minorities, women, laboring children and others over time should eventually be extended to the land and environment - that there is a moral case for environmental protection. In this view, regulation may very well "destroy wealth" of property owners who might otherwise pollute or unsustainably extract and redistribute it not only to the current public to enjoy but also to future generations who later have access to those resources and an unpolluted environment. But it is also a moral mandate, rather than something that can or should always be left to market transactions compensating polluters and unsustainable extractors from undertaking those activities (of course, one of Anderson's very compelling points is that politicians creating regulations often sacrifice the environmental wealth of future generations in order to make short-term economic and other gains. In other words, governments may, and often do, wield regulatory tools irresponsibly with regards to the environment - and this is where the market can come in and do far better).
Ultimately, once we admit that there is one moral case for regulatory limits on property rights (such as in the case of slavery), then there must be other cases that warrant deeper analysis than we have historically undertaken. We may argue over the morals that drive those choices, of course, as people have many different perspectives on moral justifications for limiting the rights of others (including property owners). But when I consider my children and the climate-changed, highly populated, increasingly paved, and resource stressed world they will live in, it is difficult for me not to view environmental conservation as a moral imperative. An imperative upon which "liberals," who stereotypically prefer regulation, and "libertarians" and "conservatives," who stereotypically prefer markets, can agree. And perhaps this is the hope - that regulation and markets can work together to make a better world and a better future.
- Blake Hudson
Thursday, July 11, 2013
For years, urban stormwater runoff has been one of the United States’ greatest unsolved water quality challenges. Urban runoff is second only to agricultural runoff as a source of water quality impairment, and on a per-acre basis, urban development is generally more damaging to water quality than agricultural use. But EPA has struggled to regulate urban stormwater runoff. For years, EPA barely regulated urban stormwater runoff at all. The 1987 Clean Water Act amendments compelled EPA to act, but even today, many point sources of urban stormwater runoff escape coverage under the National Pollutant Discharge Elimination System. The gaps are particularly salient for areas that are highly developed but lightly populated (shopping malls, for example). These areas generate a lot of polluted runoff, but they generally aren’t industrial and therefore escape coverage under the industrial program. They also often lack sufficient population to be included in the municipal permitting program (which covers census tracts based on their population density). Those gaps—and the weak coverage of the many sources that are subject to permitting—have real costs. Water quality impairment now is a pervasive feature of our urban and suburban landscapes.
Several years ago, the Conservation Law Foundation (one of the organizations that filed yesterday’s petitions) discovered a potential legal remedy for this issue. Buried in the depths of Clean Water Act section 402 is a provision requiring EPA (or a state with delegated permitting authority) to require permits for any stormwater discharge that EPA or the state administrator determines “contributes to a violation of a water quality standard or is a significant contributor of pollutants to waters of the United States.” For years, no one had paid any attention to that provision; one industry lawyer later referred to it as “the sleeping giant.” But CLF filed RDA petitions in Vermont, Massachusetts, and Maine. Each petition led to major expansions—albeit over relatively small geographic areas—in the scope of Clean Water Act permitting coverage.
A few images illustrate the impact of the change. The three images below show the Long Creek watershed in Maine.
This first image at the top shows the extent of permit coverage under EPA’s municipal program. As you can see, most of the watershed is not included, despite a high level of commercial development.
This third image shows the extent of Clean Water Act permitting coverage after EPA granted CLF’s petition (since the figure was created, the extent of permit coverage has expanded slightly). For the Long Creek watershed, this was a transformative regulatory change.
And that’s what makes yesterday’s filing so important. The environmental groups aren’t just asking for this regulatory change in a few small, test-case watersheds. They’re asking for the change across huge swaths of the country. In terms of the potential scale of impact, the closest recent analogy is the Decker v. Northwest Environmental Defense Center case, which seemed poised—until the Supreme Court granted cert and then reversed the Ninth Circuit—to expand Clean Water Act permitting requirements across much of the forestry sector. I’d argue that these petitions call for an even more ambitious effort, and that they probably address an even larger water quality problem.
There’s much more that could be said about these petitions, but I’ll stop there for now. Readers interested in learning more about these issues might be interested in the articles here and here, both of which discuss Long Creek and RDA in more depth. The website of the Long Creek Restoration Project, which documents some of the innovative work that continues to take place in that watershed, is here. And for an older post explaining why urban stormwater issues are more important and interesting than most environmental lawyers realize, see here. And stay tuned. This is an issue worth following.
Wednesday, July 10, 2013
Weighing Short Term Knowns with Long Term Unknowns in Environmental Policy - a Law and Economics Perspective
Over the next two weeks I will be participating in George Mason University School of Law's Law and Economics Center Economics Institute for Law Professors. Yesterday, Joshua Wright gave a fascinating presentation that included discussion of his recent paper "Grocery Bag Bans and Foodborne Illness." In the paper, Wright and his co-author presented empirical analysis of the health effects of the many, and increasing, jurisdictions that have instituted plastic bag bans or taxes. In short, when such a ban goes into place or when bags are taxed, people shift to substitutes. These substitutes largely take the form of re-usable cloth (or other) bags. The problem, however, is that people by and large do not wash their reusable bags. These bags become contaminated with a wide variety of nasty bacteria and other contaminants, leading to an increase in both illness and death. In fact, the data demonstrates that both emergency room visits and deaths linked to these contaminants increased by 25% after plastic bag bans or taxes were instituted. This translates into, for example, between 5 and 6 extra deaths a year in San Francisco County. The purported benefits that supporters of the plastic bag ban in San Francisco put forth and which Wright's paper cites are the prevention of over 100,000 marine animal deaths per year to plastic entanglement and reducing the consumption of over 12 million barrels of oil required to produce plastic bags used in the United States annually.
The overarching point of Wright's presentation is that often our policy choices are based on conventional wisdom ("convenient wisdom") and the unintended consequences of policies should be brought to light through empirical data and economic analysis. The argument is not unlike the "Freakonomics" argument that parents are more willing to allow their children go play in the homes of children who's parents own a pool than those who own a gun, even though the data demonstrates that their children are far more likely to drown than to die by firearm accident in those homes. I fully agree that more information is always better, and that policy-makers should take into account as many variables as possible when making policy decisions.
There are a few things that bother me about relying too heavily on this approach, however. The concerns I have do not lead me to conclude that the approach should not be taken, but rather that this type of data should be passed on to policy-makers with the appropriate caveats that short term known harms may very well be outweighed by incalculable long term unknowns, and that those "known unknowns" should be detailed to the fullest extent possible.
First, I am concerned with how the benefits and harms may be presented in these types of studies: 100,000 marine animals or some number of barrels of oil versus human lives. This is not necessarily a problem of the researchers in these studies, as they may very well be merely passing along the purported harms avoided posited by the advocates of the policy (here, the supporters of the bag ban). And yet, when the results are pitched as human lives versus a limited number of other harms not directly related to immediate human life and death considerations, it is easy to see how policy-makers might choose the policy that would avoid immediate human deaths (i.e. a bag ban reversal).
Second, and relatedly, the problem is that future yearly human deaths associated with plastic bag production are largely unquantifiable. In other words, short term knowns are more easily quantifiable through this type of empirical analysis, whereas long term, aggregated harms (which may indeed result in far more average deaths per year than 5-6 in a particular jurisdiction) or avoided benefits do not lend themselves to the same type of empirical analysis. At the very least, any empirical data that is produced is based upon projections and models, not upon identifiable deaths that have already occurred. It is incredibly difficult if not impossible to calculate the aggregated contribution of plastic bag production on climate change and sea level rise, that may lead to increased death through heightened storm disaster events, expansion of disease vectors, or its contribution to increased sexual dysfunction or cancer incidence through phthalate or BPA-like chemicals that are taken up through the human body through contact with plastic bags or bioaccumulation from plastic bag pollution in the oceans. So when policy-makers have a choice between two policies, "Policy 1 (with data) vs. Policy 2 (with no or uncertain data)," there is a bias toward the policy based upon short term, quantifiable data.
These biases, of course, appear all the time in the face of uncertainty. It reminds me of the recent Louisiana Coastal Master Plan, which plans to invest $50 billion over the next few decades on projects to mitigate coastal land loss through sediment diversions, levee, dam, and other human-built construction, etc. A recent report notes that Louisiana has the highest rate of relative sea level rise in the world, because as sea levels are increasingly rising, the land in Louisiana is rapidly sinking due to the historical diversion of the Mississippi River. A full 85% of Louisianans support the investment. I am willing to bet that 85% of Louisianans would not identify themselves as ardent environmentalists (though I argue that environmentalism is not a partisan issue and we all should consider ourselves environmentalists) or as citizens who love tax expenditures on government programs. Yet the support is widespread. This is because the short term known (immediate engineering and other feats aimed at making us feel like we can forestall sea level rise) outweighs the long-term unknown (will those projects work and would it have been better to invest those funds into adapting to coastal land loss by moving out of areas likely to be lost). In fact, the science is far from certain that sediment diversions will actually undo much of the damage that has been done along the Mississippi River, meaning that we may not be able to rebuild land in order to forestall sea level rise impacts. There is a strong chance that some of these mitigation efforts will be throwing good money after bad, at least in some areas where political pressure is to "save our coast!" Yet, imagine you have two candidates running for office in Louisiana. Candidate A, knowing that 85% of the Louisiana populous wants to save the coast, says "I will support saving your coast, investing billions in coastal restoration through sediment diversions and human-built construction that will forestall sea level rise impacts." Candidate B says "there is likely not much we can do over the long term to save significant portions of the coast, considering the rate of sea level rise and the models of future climate change impacts and atmospheric carbon concentrations. Let's take that money and invest it in adapting to coastal land loss by moving you out of areas likely to be inundated." Who gets elected? My bet is on Candidate A, even though (and perhaps because of the fact that) Candidate A AND the people who voted for him/her will be dead and gone by the time it becomes clear whether the $50 billion investment failed or not.
Ultimately, I think that empirical data on short term effects is very important and should be taken into account by policy-makers - more information is never a bad thing. But, so much of economics is about using finely tuned formulas to project short-term effects, while the long-term unknowns are largely incapable of being assessed with the accuracy that economic analysis typically prefers (hence the pervasiveness of discount rates, often inappropriately calculated when assessing the availability of resources to future generations). Policy-makers need to take these analyses with a grain of salt, recognizing that much larger policy goals stretching over much longer time periods are at stake. Today's policies are not just aimed at current residents of San Francisco, but have effects on citizens the world over and in the centuries to come.
- Blake Hudson
Tuesday, July 9, 2013
New Jersey statutory law states that where the government condemns part of a landowner’s property for a public project, the landowner is entitled to compensation not only for the property taken but also for any damages to the remaining property. Here, the Borough of Harvey Cedars condemned an easement on a strip of Karan’s oceanfront property to enhance and maintain a larger sand dune than the one in existence. Karan sought compensation for an alleged reduction in the value of the remainder in light of the new dune’s blockage of some of Karan’s ocean view. A jury awarded Karan $375,000 in damages to the remainder, and an appellate panel upheld that award.
The New Jersey Supreme Court reversed. The unanimous decision overturns the appellate ruling that had upheld a trial court judge’s decision to exclude evidence of any benefits to Karan’s home resulting from the dune project when those benefits are akin to the benefits conferred on the public as a whole.
The Court’s opinion is available here. What the decision means moving forward is not entirely clear on my initial reading.
Practically, it would appear that coastal towns considering significant dune building and beach replenishment projects post-Sandy will be quite relieved. The ruling below posed the distinct possibility that many shore protection projects simply would be far too expensive to execute, given the hundreds and hundreds of easements necessary for such projects to proceed.
Doctrinally, the Court left some stones unturned in remanding the case for a new trial. The Court swept into the dustbin of history what it called the at times “obscure,” “confusi[ing],” and “bedevil[ing]” distinction between “special benefits” (appropriate to offset a reduction in value) and “general benefits” (inappropriate to offset a reduction in value). However, the Court replaced an approach reliant on that distinction with a market valuation approach that may not prove as easy to apply as the Court’s opinion suggests. The new approach excludes consideration of “uncertain” or “indefinite” benefits when determining compensation due for damage to the remainder, but includes consideration of benefits that are “not speculative” and “reasonably calculable” at the time of the taking “regardless of whether those benefits are enjoyed to some lesser or greater degree by others in the community.”
Theoretically, the decision is sure to frustrate proponents of strong individual property rights. Yet it seems the decision also could be criticized on at least two levels by those amenable to the ultimate result. For one, the Court arguably if implicitly perpetuates the idea that a landowner’s “right to exclude” is normatively superior to other “rights.” Moreover, regularly citing the work of economist Bill Fischel, the Court assumes that whether takings compensation is due when property rules change is dependent solely on an economic calculus of the costs and benefits of the change as it pertains to the claimant’s lot.
All in all, there is much to unpack in the Court’s 48-page decision.
-Tim Mulvaney (email@example.com)
For years, environmental activists have worried that emissions trading systems will create “hot spots.” The fear, in a nutshell, is that even if the trading system succeeds in reducing overall levels of pollutants, pollution levels in areas with lots of emissions purchasers will rise. It seems quite plausible to anticipate that the areas seeing increases will contain concentrations of older industrial facilities, and it seems equally plausible, based on years of environmental justice studies, to anticipate that those older facilities are more likely to be located in minority communities. Trading systems therefore seem to threaten environmental justice.
Those fears played a central role in recent litigation over AB 32, California’s landmark climate change law. Environmental justice groups challenged the law, arguing that its trading system would concentrate greenhouse gas emissions in lower-income minority communities. While most GHG emissions are not toxic, and hot spots of GHG emissions would not themselves be a health issue, the activists feared spikes in associated emissions of toxic pollutants.
A recent article by David Adelman ought to allay those concerns. Adelman analyzed several national EPA databases on toxic emissions, and he discovered that even if industrial facilities do operate primarily as buyers in GHG emissions trading markets, they aren’t likely to create toxic hot spots. The basic reason is straightforward: industrial facilities actually emit a relatively small share of toxic emissions, and the real driver of hot spot formation is the distribution and activity of mobile sources. In other words, it’s the tailpipes, not the smokestacks, that matter most.
Here’s a key passage that summarizes the findings and their implications:
The secondary status of industrial facilities as sources of toxic emissions has particular relevance to concerns about GHG-trading regimes. A simple calculation illustrates this point: If industrial sources account for roughly ten percent of cancer risks from air toxics, as they do in many industrialized census tracts in Los Angeles, then a drop of twenty percent in toxic emissions from industrial sources would cause at most a two percent decline in cumulative cancer risks. This ten-fold factor limits the potential for inequities to arise at the scale of a census tract or county. Other factors, both economic and technical, reinforce this limit on inequities originating from GHG trading by industrial facilities. These findings suggest that a tradeoff often presumed between efficiency and equity will rarely exist for GHG-trading regimes in the United States, and that, where inequities are a potential concern, targeted policies could be adopted to mitigate them without compromising market efficiency.
And in closing:
It is my hope that the EPA data and preceding analysis will assuage concerns that toxic hotspots will be an unavoidable and substantial byproduct of implementing a national GHG trading regime. More broadly, I hope that this work will lower health-equity concerns about market-based regulations generally-including taxes.
Adelman’s article is filled with careful discussion of the strengths and weaknesses of the databases he uses and the limitations of his methodology. Nevertheless, his conclusions seem powerful. The article is well worth reading.
Monday, July 8, 2013
Resources for the Future has released a new report, The State of State Shale Gas Regulation, summarizing state shale gas regulation. The report is authored by Nathan Richardson, Madeline Gottlieb, and Alan Krupnick at RFF, along with Hannah Wiseman at Florida State. The report compares twenty-five regulatory elements—from well spacing rules to wastewater transportation—across thirty-one states with actual or potential shale gas production. The report is written in a highly accessible style and format, provides valuable information about an extremely active area of energy and environmental law, offers some important insights, and also expresses its limitations clearly (see, e.g., Figure 3 on page 11).
One of the key conclusions of the report is that state regulation of shale gas development exhibits considerable heterogeneity across states—that is, states are regulating differently. This heterogeneity may or may not be a good thing. On the one hand, with a rapidly developing area like shale gas development, and in which state rather than federal governance predominates, it makes sense that different states are experimenting with different regulatory approaches. Moreover, physical differences across states may justify different types and levels of regulation. (Political and economic differences also may lead to regulatory differences; whether politics and economics justify regulatory differences is a thornier issue.) On the other hand, we should not take for granted that heterogeneity is beneficial—some regulatory approaches may be demonstrably better than others. Hopefully the report’s comparisons will contribute to thoughtful debate in the states about the relative effectiveness of different regulatory approaches.
Thursday, July 4, 2013
Happy Independence Day, everyone!
Unfortunately, I am spending my day with a health issue. By way of a silver lining, that gave me the perfect excuse to catch up on episodes of "Through the Wormhole." All of which has led me to conclude: If you're still a stranger to "Through the Wormhole," you shouldn't be. (And, by the way, the first two seasons are readily available through Netflix and probably a lot of other services.)
So, why make the effort to watch?
(1) If you like environmental law, the chances are good that you have at least a passing interest in science. This is cutting-edge science, presented in a very intelligent format.
(2) Okay, it's mostly physics (and mostly of the quantum/cosmological type) -- but how often do we get to go there?
(3) Morgan Freeman hosts. 'Nuf said.
(4) But none of that would be enough on its own for me to feature the show on this blog. The real reason that I think "Through the Wormhole" is worth the effort for environmental law professors is that the show provides EXCELLENT examples of how to teach complex scientific concepts. Each episode starts with a plain English, common-sense explanation of why what you're about to learn is important. You then get some normal-life analogy to explain what the scientists are doing -- for example, smashing a watch becomes analogous to smashing atoms. But the best part of the show are the visuals it treats you to -- pictures, animations, special effects (aliens morphing into scientists being my favorite so far), and all manner of scientific illustrations and data displays -- while the scientists and Mr. Freeman explain (with excellent senses of humor all around) what the heck the scientists are doing.
I can't say, after watching the episode on subatomic particles, that I can give you a physicist-quality explanation of what a Higgs boson is -- although, in my own defense, the physicists talking about it seemed a little blown away by the concept as well. On the other hand, the episode on the possibility of alien life certainly gave me some new perspectives on water and ecological principles that I plan to incorporate into class, and the discussions of alternate evolutions on Earth (with careful and understandable presentations of the scientific evidence) will have repercussions for how I teach students about deep-sea thermal vent ecologies in Ocean and Coastal Law. I recommend the episode to anyone who teaches biodiversity issues to students.
More importantly, the series as a whole is giving me some great new perspectives on how to blend lecture, video, and graphics into much more effective presentations of hard-core science than I've been doing to date. I think that the examples from the series will be especially instructuve for how I teach the basic science of climate change in Environmental Law and the basic human biochemical reactions to toxins in Toxic Torts. I'm really looking forward to experimenting next year!
Give the show a try!
-- Robin Kundis Craig
July 4, 2013 in Biodiversity, Climate Change, Physical Science, Science, Sustainability, Television, Toxic and Hazardous Substances, Water Resources, Web/Tech | Permalink | Comments (1) | TrackBack (0)
Tuesday, July 2, 2013
Busy as I've been with summer work, I didn't get around to listening to President Obama's climate change speech until last night. In case you are in the same situation, the video is here and a full transcript is here.
What a terrific speech. I really liked Obama's observation that those who say that environmental regulation will harm the economy lack faith in American ingenuity. He gave a lot of good examples of how regulation has led to innovation that has been good for both the economy and the environment. This message would have broad appeal if people would listen.
Another highlight was Obama's remark that Keystone XL should not go forward if it would “significantly exacerbate the problem of carbon pollution,” commented upon at Legal Planet by Steve Weissman.
I also appreciated Obama's calling out that environmental protection has not always been and should not be such a partisan issue. I knew, for example, that the Clean Air Act was signed by President Nixon, but I didn't realize that it passed the House and Senate almost unanimously (with just one no vote in the House). Wow.
And, finally, I liked how Obama made references throughout about the importance of this issue to today's children. As I've said before, I don't get why more parents and grandparents aren't demanding strong action. As Obama put it: "And someday, our children, and our children’s children, will look at us in the eye and they’ll ask us, did we do all that we could when we had the chance to deal with this problem and leave them a cleaner, safer, more stable world?"
- Lesley McAllister