In the last few weeks, the Biden administration issued guidance in two areas: 1) Greenhouse Gas Emissions and Climate Change and 2) Environmental Justice (EJ) in Air Permitting. To be prepared for new regulatory actions and practices, it’s important for industry seeking federal permitting or funding to be informed about how their projects will be evaluated by government agencies.
Greenhouse Gas Emissions and Climate Change
On January 9, 2023, the White House Council on Environmental Quality (CEQ) published interim guidance establishing uniform practices for assessing the scope of greenhouse gas (GHG) and climate change effects of proposed federal projects pursuant to the National Environmental Policy Act (NEPA). Although the guidance is open to public comment until March 10, 2023, and subject to change, it is effective immediately.
As summarized by Sidley Austin LLP in a Lexology article, industry should expect the following from federal agencies in response to this interim guidance:
- “[A]dditional scrutiny regarding the Social Cost of GHG emissions associated with a project, especially for fossil fuel projects
- [R]educed scrutiny of GHG effects for projects that have a small carbon footprint, comparatively, such as renewable projects
- [I]ncreased review of the relationship between the project and climate change
- [I]mposition of mitigation measures to address GHG emissions or climate change effects
- [P]articular scrutiny and increased data requirements for projects relying on or applying for the Inflation Reduction Act (IRA) or Infrastructure Investment and Jobs Act (IIJA) funding”
The issuance of the guidance was directed by Executive Order (EO) 13990, Protecting Public Health and the Environment and Restoring Science to Tackle the Climate Crisis, with the purpose of restoring science in federal decision-making, fighting climate change, and building resilient infrastructure.
This guidance is expected to:
- Improve sustainability while keeping environmental reviews focused and efficient.
- Provide more clarity and predictability for conducting reviews.
- Improve transparency in the reporting of GHG emissions, including the appropriate use of the SC-GHG to disclose climate impacts.
- Make projects more climate-smart and resilient.
Environmental justice (EJ) in air permitting
On December 22, 2022, the EPA Office of Air and Radiation released guidance on “Principles for Addressing Environmental Justice in Air Permitting.” This memo provides eight principles as an “interim operating framework for identifying, analyzing, and addressing EJ concerns in the context of Clean Air Act (CAA) permitting.”
While acknowledging that permitting decisions must often be considered on a case-by-case basis, the EPA states these principles reflect best practices for EPA staff and colleagues at state, tribal, and local air agencies to follow:
- Identify communities with potential EJ concerns. Utilize the EJScreen tool and other geographic information system and mapping tools and data to identify communities with potential EJ concerns to encourage proactive community engagement and promote the fair treatment and meaningful involvement of the affected community in air permitting actions.
- Engage early in the permitting process to promote meaningful participation and fair treatment. Permitting authorities are encouraged to identify those permitting actions that may have a disproportionately high and adverse effect on communities, including those with EJ concerns, preferably before the permit application is submitted. It also recommends that air permit applicants work with the permitting authority and affected community to provide opportunities for meaningful participation and fair treatment throughout the air permitting process.
- Enhance public involvement throughout the permitting process. Permitting authorities and permit applicants are advised to provide the affected community with meaningful opportunities to provide input into the decisions that will impact residents’ lives. Effective public participation is also a component of any analysis to determine whether recipients’ programs and activities, including permitting activities, comply with the EPA’s nondiscrimination regulations.
- Conduct a “fit for purpose” EJ analysis to inform the permitting decision. These types of analyses accomplish two purposes by addressing the principles of:
- Fair treatment by further evaluating adverse and disproportionate impacts and identifying ways to prevent or mitigate such impacts, and
- Meaningful involvement by fostering enhanced community engagement in the permitting decision.
Examples of this type of analysis include:
- Further evaluation of demographic data indicating vulnerabilities in the affected population;
- Further input from stakeholders, including the affected community;
- An evaluation of the facility’s compliance record;
- An evaluation of existing public health data about the affected community;
- An evaluation of the permitting action’s potential health and nonhealth adverse effects (e.g., noise, odor, and traffic);
- An evaluation of the cumulative impact of the permitting action under consideration together with impacts from other regulated and nonregulated sources of pollution in the community; and
- An evaluation of potential methods for minimizing or mitigating adverse effects on the community.
- Minimize and mitigate disproportionately high and adverse effects associated with the permit action to promote fair treatment. Permitting authorities are advised to fully examine all relevant statutory and regulatory authorities, including discretionary authorities, to develop permit terms and conditions to address or mitigate identified air quality impacts to the extent feasible.
- Provide federal support throughout the air permitting process. Permitting authorities are advised to collaborate with the EPA so it can provide technical support, guidance, and recommendations to address these effects on the community, including cumulative effects.
- Enhance transparency throughout the air permitting process. The EPA recommends permitting authorities provide transparency in decision-making throughout the air permitting process, with consideration of the specific needs of the community, and make administrative records for the permitting action readily available in a format and location that is easily accessible to the affected community.
- Build capacity to enhance the consideration of EJ in the air permitting process. This principle stresses the importance of building collaboration with regulatory partners, stakeholders, and affected communities nationwide to promote the fair treatment and meaningful involvement of communities with EJ concerns in the air permitting process.
“EPA’s guidance is largely consistent with the recent agency guidance on EJ best practices, such as its recent FAQ on considering EJ in permitting,” Beveridge & Diamond PC says in a Lexology article. “However, the targeted focus on considering EJ in the context of air permitting and the direction to EPA Regions to share this guidance when collaborating with state and local regulators signal a shift in tone from prior guidance, with a sharper and more determined call to action.”
Both policy updates detailed in this article reflect continued action by the Biden administration to double down on addressing EJ issues and make progress toward its goal of achieving net-zero carbon emissions by 2050. The regulated community should prepare for increased scrutiny in the permitting process by proactively researching the cumulative costs of GHG emissions, particularly in relation to fossil fuel projects, and their impact on EJ communities.