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Blue methane bubbles?

31 Jan 2013

Last fall, I blogged about this very cool burning ice, methane hydrate.  This is actually methane trapped in ice.  Well, I just came across this story which shows methane hydrate in another view.  The video, which shows the trapped gas being ignited, is pretty impressive.

On the plus side, this may be a cleaner source of fuel. On the other hand, methane escaping on its own is a powerful greenhouse gas (some say almost 20 times as powerful as CO2).  Extracting something like this obviously poses its own challenges when a spring thaw sends the methane bubbling into the air.

“Seinfeld bill” held unconstitutional

7 Jan 2013

In the flurry of year end errands, I failed to report on this.  Many of us remember the episode of Seinfeld, where Kramer and Newman schemed to take New York cans and bottles to Michigan to effect “bottle deposit arbitrage” by getting deposit reimbursements for bottles and cans on which no deposit had been paid.  The scheme didn’t work, but a 1998 study which reported up to $30 Million in such fraud annually and an actual fraud ring inspired the Michigan legislators to amend Michigan’s bottle bill to try to prevent such shenanigans.

In 2008, the bottle bill law was amended, among other things,  to require bottlers to put a “unique mark” on beverage containers sold in Michigan to allow reverse vending machines to determine if a container was from Michigan. Also, such mark could be used only in Michigan “and 1 or more other states that have laws substantially similar to this act.”  “Reverse vending machines” are the automated self-service bottle return devices you see at many supermarkets these days.

This law was challenged as a Michigan intrusion into interstate commerce under the so-called “dormant commerce clause” of the US Constitution.  The Constitution grants the US Congress power to regulate commerce among the States.  The “dormant” part of the dialogue  deals with what happens when Congress has been silent on the topic.  There is a whole body of case law that interestingly has dealt with State and local regulation of solid waste and other activities when Congress hasn’t acted.

The Sixth Circuit Court of Appeals held that the requirement of the unique mark was not discriminatory because it applied to both Michigan and non-Michigan bottlers. But the Court also held that the requirement that the mark could not be used on bottles in other states except with similar bottle laws regulated commerce outside of Michigan and so violated the doctrine against extraterritorial application of laws, rendering it invalid.

One of the Judges, while agreeing, wondered whether the extraterritoriality doctrine should continue to be followed, noting the indirect (and therefore valid) state specific requirements of California (auto emissions), Ohio (milk labels), Vermont (light bulb labels warning of mercury dangers) and so on.

Fewer water bottles – absolutely

10 Dec 2012

Almost two years ago, I blogged about a 3M product that my then 9 year old suggested we buy – A Filtrete Water Station.

While we haven’t completely stopped buying bottled water, I’m pleased to report that we’ve cut our bottled water purchases easily by 90%.  Where we would buy one of those 24 bottle pallets almost weekly, it seems like we buy, at most, a couple of bottles a month and the last pallet we bought is still in the basement and no one can recall when we bought it!

The Filtrete system is still working – we’ve replaced the filter a few times but the biggest issue seems to be that we use these bottles so often that the hinges on the “handles” (which you can see folded down on the bottles in the photo) are starting to wear out. The bottles still look like new. Unfortunately, it doesn’t appear that anyone sells just the cap assemblies which include the handles and hinges – perhaps 3M will consider that.


Oil and gas production in your backyard? Maybe.

8 May 2012

Coming to a backyard near you?

This weekend I saw a front page article in the Saturday paper about today’s State auction of mineral (oil and gas) leases.  As the article points out, a number of the offered leases are in neighborhoods in and around Oakland County’s tony lakeshores.  This was followed by a slew of concerned emails.  So, how did this happen; what does it mean; can the property owners stop it and can this happen in your backyard?  Interestingly, the news article doesn’t really answer these questions.

The article is correct; today, Michigan will be auctioning off mineral rights in locations all over the state, including in Oakland County.  In some cases, the State retained the mineral rights when it conveyed the property; in some cases, it is tax reverted property.  Some of the leases have  the properties tagged as “for development” which means a well may go there and in others, not.

Can it happen to you?  Maybe – check your deed.  If someone (the State included) reserved the mineral rights out of your title, then yes, it can. If not, then no, it can’t happen to your property unless you agree to lease the mineral rights to someone.   That doesn’t mean you may not see an oil or gas well in your neighbor’s yard.

Can the property owners stop it Maybe – temporarily.  Many property owners are at least talking about trying to out-bid the oil and gas companies at the auction.  Emails flying around say one might be able to bid $10 to buy the rights.  The problems are that the leases only last 5 years, require a bond of at least $10,000 (which the emails make no mention of), and if one can buy them for $10, how likely was it that someone in the industry thought they were worthwhile? Another approach would be to seek to enjoin the drilling but there are many problems with such an approach to stop something that is legal and arguably can be done safely and for which monetary damages would certainly be available.  The owner’s rights to bring a suit (standing) would also be at issue although recent case law should favor them.  However, local  judges might be swayed by local sentiment.

What does it mean?  Well, it doesn’t necessarily mean a well in someone’s backyard.  People are often stunned to find out that, legally, the owner of the minerals (in this case, the State) is actually the dominant estate and has rights to use the surface even though it doesn’t own the surface.  However, the lessee will need to get a  drilling permit from the MDEQ Supervisor of Wells.  Further, the lease terms themselves require:

  • The Lessee to pay for all damages or losses (including any loss of the use of all or part of the surface), caused directly or indirectly by their operations.
  • Before a drilling permit application is submitted, notification to enter the land must be provided to the surface owner, and that either voluntary agreement or stipulated settlement relative to surface use and damages has been reached.  When a  mutual agreement cannot be reached, after a 30 day cooling off period, if the issue is not resolved, then drilling and development can proceed and the property owner and company will need to fight it out.  The law on this complex and evolving.

Can fracking be used in these locations, as many have expressed concerns about that?  The answer is, if permitted and done in accordance with applicable laws and rules, then yes it can be.  If the operations cause harm, the property owners can sue but, as many have expressed concern, the damage will already be done.

Earth Day at 42 – still meaningful?

20 Apr 2012

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?

Sustainability – the new buzz word?

4 Apr 2012

Sustainability seems to be showing up everywhere. Certainly, in the national budget debates, and the arguments over national health care, we hear many arguments about what is and is not sustainable. As a topic, environmental sustainability is certainly rising on the radar screens of corporate America. Companies as varied as Ford, GM, Kimberly-Clark, Alcoa, Dole Food, Boeing, all have appointed corporate sustainability executives and are setting sustainability goals. Dow recently announced a $10 Million grant to the University of Michigan to support research fellows on the topic of sustainability.

There are many reasons for adopting a corporate sustainability mind-set. Certainly, saving money in production costs, disposal costs and energy costs are usually at the forefront. Additionally, execs focus on customer perception and corporate reputation.   What is “sustainable”? Well that depends.  A commonly referred to definition of sustainability comes from the Brundtland Commission of the United Nations from March 20, 1987: “sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs.”  While there has been a lot of talk about improving the “Triple Bottom Line” of benefits in  ecology, society and traditional profits, the first two are much harder to measure than the third.

Ernst & Young recently released a report on sustainability noting that, while, sustainability as a concept is in its infancy, it is catching on among corporations.  The report notes that, among other things, employees are often a key group in developing and maintaining working sustainability programs. This makes sense as a top-down approach simply won’t work (how many times do you tell your kids to turn off the lights when they leave a room?)

There is some very sophisticated thinking going on in corporate America with companies focusing on their supply chains as well as their customers’ short and long term needs to determine how best to achieve greater sustainability.

Fix it and forget it? No way…. don’t rely on a punchlist

21 Mar 2012

I’ve seen buyers put together their post-closing “punch list” which sits on a shelf forever. Two recent decisions reflect the need both for good lawyers and good follow-up by property owners – because no one in the government is going to do it for you.

In one case, in 1998, an older couple, the Kudingers, sold land with underground storage tanks (USTs) and contamination to a developer. The purchase agreement required the Kudingers to clean it up. They hired a consultant and did a cleanup but the consultant never asked the MDEQ to designate the property as “closed.”  Mrs. Kudinger died in 2002; her husband died in 2006 and the developer never checked on the closure.  When the developer tried to refinance in 2007, it found out the hard way that the property was still listed as “open” and it wound up costing another $77,000 to close it.

The trial court and court of appeals focused on the fact that the contacts with the Kudingers did not include a time for performance. Both courts agreed that, without an explicit time, the courts should imply a reasonable time for performance.

Cleanups tend to be complicated and difficult to predict and this case highlights the need for careful drafting and for diligent follow-up. Assuming no news is good news is not the right approach

A Federal court also recently resolved a dispute (here) between a shopping center owner (landlord) and its former tenant (Goodyear).  After a lawsuit had begun over the cleanup, Goodyear (unbeknownst to its landlord) asked the MDEQ to approve its cleanup by granting it a no further action NFA letter.

The Court rejected landlord’s challenge to the NFA as not an improper use of legal process and to MDEQ’s granting of it as not illegal.  Ultimately, it doesn’t appear that the NFA prevents landlord’s lawsuit, but the NFA may make the fight harder and it highlights the landlord’s failure to monitor its tenant’s activities.