Michigan Green Law

Earth Day 43 seems to have been lost given the recent events in Boston, Texas and elsewhere.  The environmental news continues to be a mixed bag – with reports of fewer Americans “caring” about the environment but perhaps more “acting” in a “green” way.

We have certainly come a long way from the challenges and problems that led to the first Earth Day -  a 1969 oil spill in Santa Barbara, California; the dead zone in Lake Erie; smog in Los Angeles and elsewhere and burning rivers in the Midwest.

The first Earth Day led to the creation of the US Environmental Protection Agency and the passage of the Clean Air, Clean Water, and Endangered Species Acts.  As the EPA and its state counterparts have continued to regulate, there has been a backlash of business and media outcry which certainly must weigh on the public’s views.

The challenges we face today are far more complicated and, to many, more daunting.  We still have oil spills, but now they are from larger ships and deeper wells.  Lake Erie and many other bodies of water are still challenged by more diffuse and “below the radar” sources of contamination.  While reducing the impacts of asbestos, lead and NOx from our daily lives, and healing the ozone hole, we now face questions regarding greenhouse gasses, impacts from and in China and the developing world, and the challenges and benefits posed by fracking.

As is often the case, once the “low hanging fruit” of black and white are picked, what we are left with is grey and grey isn’t as shocking or engaging as black and white.  The issues are just as important, and in many ways, very high profile, but it’s unlikely that our polarized country would agree on what changes would be best, if any.

On Friday, President Obama announced in a speech his plans for an Energy Security Trust  to fund $2 Billion in research into energy technologies to help the United States, among other things: (1) get off oil altogether (particularly foreign oil); (2) develop clean coal technologies; and (3) improve efficiencies in the production of natural gas (thereby reducing greenhouse effects).

This hits at two interesting sweet spots -  1. It finally relates energy to national security; and 2. It focuses on something everyone agrees government should be supporting – basic research (vs that nasty old picking winners and losers). As a concept I really like this and think it’s the sort of future-thinking investment our government should be pursuing (like investing in education, clean water, good roads, etc.).

What I find interesting is the concept that this Trust will be funded by “Revenue from Profitable Oil and Gas Companies” and thereby won’t increase anyone else’s taxes.  Per the President’s speech, he wants to fund the Trust from oil and gas royalties on federal lands.

The government already collects around  $9.5 billion in oil and gas royalties.  Over half of the revenue goes to the U.S. Treasury. About a billion goes to the Land and Water Conservation Fund which is distributed to states and federal agencies to acquire and develop public lands. Finally, distributions are made to states or monies generated on federal lands within those states.

The concept has been used before. Back in a somewhat less contentious era, the federal Superfund was created to clean up “orphaned” waste sites.

It was funded in part by excise taxes on crude oil and refined oil products, on hazardous chemicals, on imported substances that used hazardous chemicals and by an environmental income tax of 0.12% on a corporation’s modified alternative minimum taxable income over $2 million.  Those taxes expired in 1995 and since then the EPA has funded Superfund based on Congressional appropriations of around $1.2 billion annually and whatever EPA recovers from companies liable for sites that EPA had cleaned up.

The President’s speech left out exactly where the $2 Billion would come from – will it be from: (1) an increase in royalties; (2) eliminating royalty waivers; (3) a reduction in payments for public lands; or (4) a reduction in payments made to states?  Based on the commitment not to raise taxes, it appears that the Treasury will continue to get its cut. I suppose another option would be to increase by some 20% the number of wells being drilled.  This appears to be the direction that the group that developed this concept wants to go.

We can see where this fight is going.  The House of Representatives and many in the Senate have taken the “no new taxes” pledge.  Liberals in Congress will fight more arctic and off-shore drilling.  Will the President dangling more drilling rights encourage the politicians to go for this and spur some of the world’s largest companies to agree to help subsidize their own potential extinction?  The odds of this proposal getting enacted seem very long, even if the goals are quite worthwhile.

A recent report by the reinsurance firm, Swiss Re raises some interesting possibilities.  The first of which is that Swiss Re says it is possible for 92% of the world to shift to low carbon technologies by 2050 if agreements are put into place by 2015.  Swiss Re reports that low carbon technologies make up 33% of the global power supply.

The report reviewed 6 scenarios for the future:

1. Greenhouse gas (GHG) reductions are not pursued and adaptation to climate change is required;

2. Dramatic weather changes lead the world to drastically reduce GHG in 2025, including by building CO2 capture systems;

3. Gradual pursuit of GHG reduction happens, but not fast enough to impact climate change;

4. Research leads alternative energies to become competitive with, and replace, fossil fuels;

5. High carbon fuel prices allow alternative energies to compete with, and replace, fossil fuels; and

6.  Economic recovery and consensus lead to strong greenhouse gas policies to spur investment in green technologies.

The report concluded that options 3, 4 and 5 are believed the most likely to occur.   Interestingly, the report concludes that the cost to shift energy generation, while high, is roughly 20% of the cost of world-wide adaptation to a changing climate.

As we race toward the end of the year, we thought we’d look back at what we thought were the big stories of 2012 on MichiganGreenLaw.com, in no particular order:

•Wetland Rules – EPA and the Army Corps of Engineers submitted final guidance to clarify the scope of waters regulated under the Clean Water Act to the Office of Management and Budget for federal interagency review. The EPA and the Corps have been the subject of “inquiries” from Congress, industry organizations, environmental groups, states and the public for rulemaking to further clarify the requirements of the Clean Water Act consistent with decisions of the Supreme Court. We continue to wait.

• Fracking– something that was little heard of before 2011, received a lot of notoriety as dueling reports were released and a flurry of rules and guidance including: an EPA rule to require well developers to institute “green completion” procedures which phases in over the next two years; EPA guidance when diesel fuel is included as a component of the fracking fluid used to free the trapped gas; and U.S. Department of the Interior draft rules for fracking on federal and Indian lands.  The comment period closed in September and the Department recently announced that the rules would not be finalized until sometime in 2013. Finally, the petition drive to amend the State Constitution to ban the use of horizontal hydraulic fracturing fell flat and did not make the ballot.  Given the voters’ response to Constitutional amendments and in particular, how Proposal 3 relating to the clean energy renewable portfolio standard failed, it seems likely that this would’ve failed too.

• MDEQ reorganization – the Director shook up the staff at the MDEQ. There was a CSI process intended to streamline the cleanup program and, in the last month, the Department’s cleanup division got a new chief, Bob Wagner, and the Governor signed legislation that was developed in part through the CSI process.

• EPA Greenhouse Gas Rules vs. Congress. – a federal appellate panel approved EPA’s rules under the 1990 Clean Air Act  aimed at coal burning power plants.

• Coal Ash – Hazardous Materials – while EPA had proposed rules to more heavily regulate ash from the combustion of coal, it ran into a political buzz saw and the regulations went nowhere.  Luckily, the coal industry avoided the sorts of accidents that plagued them in 2011.

• Keystone Pipeline.  As we predicted, President Obama and Congress started 2012 locked in a politically charged dispute over the Keystone XL pipeline, a proposed 1,700-mile oil pipeline from Canada to Texas.  The President deferred it, catching some election year heat, and will likely have to deal with it again in 2013.

• Governor Snyder focuses on Environment/Energy - at year’s end, the Governor issued a policy statement on these two interrelated issues and we expect next year to see a focus on improvements in both.

• Change at the EPA? Lisa Jackson announced on December 27, 2012, that she’d be stepping down as head of the EPA early next year.

Today, Governor Snyder announced his Special Message on Energy and the Environment. True to his nature, he focused on strategic plans and smart decisionmaking with a long term view – something that I agree with.

The Governor focused on three “pillars” relating to energy: (1) reliability; (2) affordability; and (3) environmental protection.  Possibly to the chagrin of  some, he proposed a 2013 legislative dialogue to set goals for energy efficiency and renewable energy, certainly reviving hopes of the people who unsuccessfully  pushed Proposal 3 on the 2012 ballot.  He also bemoaned the lack of a federal energy strategy.

He didn’t discuss every one of the many points of his 19 page message but did talk about the following:

1. expanding the successful Michigan Saves program to help small businesses with energy efficiency;

2. figuring out how to expand development of Michigan’s natural gas resources  (he touted Michigan’s successful fracking practices) and announcing a partnership with UM’s Graham Sustainability Institute to work with industry and environmentalists to ensure that fracking is done safely; and

3. He discussed revamping and strengthening Michigan’s program’s to provide at-risk people maintain utility services.

As to environmental policy, he urged an ecosystem approach and he:

1.  proposed a strategic plan for all of Michigan’s publicly owned lands – building off his blue ribbon parks paneland including a plan for abandoned urban lands and pushed for better methods to aggregate and plan for them;

2. said it was time to resolve the conflict between urban farming and the Right to Farm Act;

3. announced that he was going to co-chair the Great Lakes Governor’s Council and would call a summit to discuss many issues including invasive species (both focusing on prevention and control) – this will likely be a thorny issue particularly in dealing with Illinois on the issue of Asian Carp;

4. asked for a proactive strategy for Michigan’s inland lakes and sustainable water usage; and

5. a surprise to me, he talked about improving recycling programs across the State.

There’s a lot more in there which we will be discussing in the future. But even treating energy and environmental issues as integrally related is a welcome new and dynamic approach.

One of Kevin’s first posts on the Blog related to a Swiss solar powered plane, the “Solar Impulse” which flew for one and a half hours.  In 2010, Kevin noted the team’s plan to fly it around the world in 2012.

They haven’t made it around the globe yet but, as reported today, they did fly it from France to Morocco and back (4,000 miles), successfully. They apparently have been focusing on durability, charging and range as reportedly the airspeed remains at 28 miles per hour.   By my math, that would take about 37 days to go around the world. Of course, the France to Morocco run included a number of stops along the way.

A recent study released regarding so-called “millennials” (those born after 1982) found here, reported that these young people considered goals relating to things like money, image, and fame more important than those related to self-acceptance, community, empathy, charity, and, most surprising to me, taking action to help the environment and save energy. Perhaps this is not so surprising given the economic crisis we are still working our way out of, coupled with the technological, Jersey Shore media world our young people find themselves living in.  However, given the emphasis on the environment in our schools and media, it still seems somewhat disturbing.

Given that Earth day is this weekend, there are sure to be a plethora of lists to “do this” or “do this and not that.”   There are lot of things that people  will talk about as win-wins (saving “green” as in money and the environment) – use programmable thermostats; don’t run the water while brushing your teeth (or before taking a shower); take showers not baths; don’t water your lawn mid-day; put a brick in the toilet tank; use a low flow showerhead;  switch to CFL or LED bulbs; use cloth grocery bags; keep your tires inflated, etc.   So, are people doing these things? And after they have done them, what’s next?  But even more importantly, is Earth Day relevant to the next generation of leaders, consumers and manufacturers who are now attending college – or do they just not care?

The images above should resonate with anyone my age, but that “crying Indian” first went on the air in 1971 – one year after the first Earth Day. I suspect that there are many out there who have never seen him and have no clue why he was crying.  Further, the environmental issues that spawned the first Earth Day have receded and have been replaced by far less tangible and even arguable threats.  No one argued about whether or why the Rouge and  Cuyahoga rivers caught fire or that they were a bad thing.  Now, there is far more debate about whether fracking is good or bad (maybe both), whether global climate change is occurring and even moreso over why and so it is far easier for today’s young people to tune out due to the complexity of the issues.

However, given the economy, the scarcity of resources and the economic times in which we live, it is a bit disappointing that we haven’t learned to look how our grandparents lived when they were young – how they “made do” and repaired and sewed, turned lights off (or used natural light) and gardened; not because it was “green” but because that was how they could afford to live and that’s how every generation until then had lived.

It’s only been in the last 65 years that disposability has been the norm.  Do we need to dial down the consumptive aspects of our lives and try to show our teens and college students that we need to live a bit more like the greatest generation did before World War II and a little less like they did after? What do you think?