GAO Report Finds that Climate Change Could Cost the Federal Government Billions; Alaska Governor Establishes State Climate Change Strategy

In a September 2017 report, Climate Change: Information on Potential Economic Effects Could Help Guide Federal Efforts to Reduce Fiscal Exposure, the Government Accountability Office (GAO) studied the potential economic effects of climate change in order to help federal decision-makers identify significant climate risks and develop government-wide priorities to manage such risks.  The report concludes that extreme weather and fire events have cost the federal government over $350 billion over the past decade. As climate change causes these extreme events to become more common and more intense, recurring costs to the federal government could reach $35 billion per year by mid-century, and $112 billion per year by late century.

GAO found that federal-level planning is needed because the economic effects of climate change could be unevenly distributed across sectors and regions. For example, the Southeast region may face greater potential economic effects than other parts of the country as a result of coastal property damage as sea levels rise. The report recommends that the appropriate entities within the Executive Office of the President, including the Office of Science and Technology Policy, use information on potential economic effects to help identify significant climate risks and craft appropriate federal responses.

In addition, more localized strategies to combat climate change continue to develop.  On October 31, 2017, Alaska Governor Bill Walker signed Administrative Order 289, establishing the Alaska Climate Change Strategy and Climate Action for Alaska Leadership Team. Recognizing that climate change threatens the availability and quality of Alaska’s resources, the order aims to “creat[e] a vision for Alaska’s future that incorporates long-term climate goals, yet recognizes the need for non-renewable resources to meet current economic and energy requirements during a transition to a renewable energy based future.” To that end, the order announces Alaska’s intent to engage with national and international partners to seek collaborative solutions to climate change that support the goals of the United Nations’ 2015 Paris Agreement.

In particular, the Leadership Team has been charged with identifying measures to:

  • mitigate Alaska’s greenhouse gas emissions;
  • help Alaska’s citizens, environment, and infrastructure adapt to climate change impacts;
  • bolster scientific research, innovation, public outreach, and education related to climate change and mitigation and adaptation strategies; and
  • plan for timely and robust responses to address near-term threats to Alaska’s communities from ocean acidification, coastal erosion, storm impacts, oil and other toxic spills, infrastructure damage, and other climate change impacts.
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2017 Emissions Gap Report Finds that More Action is Needed to Meet Paris Goals

The United Nation’s Environment Programme (UN Environment) has released its 2017 Emissions Gap Report.  In its eighth edition, the report addresses the “gap” between the emissions reductions necessary to achieve the Paris Agreement goals of limiting global warming to under 2º Celsius (as compared to pre-industrial levels), and the reductions that will likely result from the full implementation of the individual country pledges to reduce emissions, also known as the Nationally Determined Contributions (NDCs).

It finds that the NDCs account for only one third of the reductions necessary to meet the 2º Celsius climate target, and states that “[t]he gap between the reductions needed and the national pledges made in Paris is alarmingly high.”  The press release accompanying the report further states that “[s]hould the United States follow through with its stated intention to leave the Paris Agreement in 2020, the picture could become even bleaker.”

The report finds that “if the emissions gap is not closed by 2030, it is extremely unlikely that the goal of holding global warming to well below 2°C can still be reached.” However, it then proceeds to address a number of ways that gap can be closed, including through:

  • Revising and strengthening the NDCs;
  • Implementing emission reduction initiatives by subnational and non-state actors, e.g. regional and local governments and businesses;
  • Implementing sectoral emission reduction measures, including in the buildings sector through energy efficiency measures and the energy sector through the growth of wind and solar energy, and through measures to reduce methane emissions from the oil and gas production/distribution and from coal mining (e.g. by reducing gas leakage, recovering/utilizing vented pipeline gas, implanting pre-mining degasification measures, etc.).  According to the press release: “Much of the potential across the sectors comes from investment solar and wind energy, efficient appliances, efficient passenger cars, afforestation and stopping deforestation. Focusing only on recommended actions in these areas — which have modest or net-negative costs — could cut up to 22 GtCO2e in 2030.”

Relatedly, the 1 Gigaton Coalition also released today a report entitled Renewable Energy and Energy Efficiency in Developing Countries: Contributions to Reducing Global Emissions. The Coalition is supported by the Government of Norway and coordinated by UN Environment.

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Federal Agencies Respond to Trump Order to Evaluate Regulatory Burdens on Energy Independence and Economic Growth

On October 25, 2017, the Department of Energy (DOE), Environmental Protection Agency (EPA), and the Federal Energy Regulatory Commission (FERC) issued their final reports on how each of the agencies is working to reduce regulatory burdens and promote energy production and economic growth.  The agencies’ reports respond to a directive in President Trump’s Executive Order 13783 which, in part, required federal agencies to undertake a review of all federal rules that “potentially burden the development or use of domestically produced energy resources, with particular attention to oil, natural gas, coal, and nuclear energy resources.”

The DOE report makes four pointed recommendations to reduce unnecessary burdens on the development and use of domestic energy resources:  (1) streamline natural gas exports; (2) review National Laboratory polices; (3) review National Environmental Policy Act regulations; and (4) review the DOE Appliance Standards Program.

In its report, EPA also targets four key burden-reduction areas: (1) comprehensive New Source Review reform; (2) National Ambient Air Quality Standards reform; (3) robust evaluations of the employment effects of EPA regulations; and (4) a sector-based outreach program.

FERC’s report takes a less rigid approach, and identifies several potential areas the Commission may consider for reform in four jurisdictional areas: (1) hydropower licensing; (2) liquefied natural gas and natural gas pipeline and storage facility siting; (3) centralized electric capacity market policies; and (4) electric generator interconnection policies.

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Federal Agencies Focus on Cybersecurity Threats Facing Energy Sector

Last week, the Department of Homeland Security (DHS) and the Federal Bureau of Investigation released a joint Technical Alert entitled Advanced Persistent Threat Activity Targeting Energy and Other Critical Infrastructure Sectors.  The Technical Alert focuses on potential cyber threat targets in the energy, nuclear, water, aviation, and critical manufacturing sectors.  It describes recent threats as “a multi-stage intrusion campaign by threat actors targeting low security and small networks to gain access and move laterally to networks of major, high value asset owners within the energy sector.”  These threat actors use a variety of tactics, techniques, and procedures, including open-source reconnaissance, spear-phishing emails, watering-hole domains, host-based exploitation, industrial control system infrastructure targeting, and ongoing credential gathering.  DHS “has confidence that this campaign is still ongoing, and threat actors are actively pursuing their ultimate objectives over a long-term campaign,” and this Technical Alert aims to educate network defenders about how to identify and defend against these threats.

FERC has also taken several actions regarding cybersecurity this month.  On October 2, 2017, it terminated a proceeding about the cybersecurity of control centers used to monitor and control the bulk electric system.  FERC issued a Notice of Inquiry earlier this summer based, in part, on the 2015 cyber-attack that disrupted Ukraine’s electric grid.  However, after reviewing the comments it received, FERC concluded that the existing North American Electric Reliability Corporation’s Critical Infrastructure Protection (CIP) Reliability Standards are sufficiently flexible to address FERC’s concerns about cybersecurity at control centers.

More recently, on October 19, 2017, FERC issued a Notice of Proposed Rulemaking that would adopt a new CIP Reliability Standard addressing cybersecurity concerns.  This proposed Reliability Standard would: (1) clarify the obligations related to electronic access control for low-impact cyber systems; and (2) adopt mandatory security controls for “transient electronic devices,” such as thumb drives, laptops, and other portable electronics that can connect to cyber systems.  Comments on the Notice of Proposed Rulemaking are due 60 days from publication in the Federal Register.

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EPA asks Court to Continue Abeyance of CPP Litigation, Intervenors Push Back

On October 10, 2017, EPA filed a status report in the CPP Litigation, West Virginia v. EPA, informing the D.C. Circuit of its proposed rule to repeal the Clean Power Plan. EPA states in its report that the proposed repeal is based on “a proposed change in the Agency’s interpretation of section 111 of the Clean Air Act, 42 U.S.C. § 7411.”  EPA explains that it is still considering the scope of a potential replacement and that it will “be signing in the near future an Advance Notice of Proposed Rulemaking that will solicit information on systems of emission reduction that are in accord with the legal interpretation that has been proposed by EPA.”  EPA asks the court to extend the abeyance period indefinitely “pending the conclusion of the rulemaking.” (Per the last court order, the current abeyance period was to expire on October 7, 2017.)

Both State and Municipal Intervenors and Public Health and Environmental Organization Intervenors filed briefs requesting that the court rule on the merits of the CPP challenges and reject EPA’s request for an indefinite abeyance.  Both sets of Intervenors explain that, at this time, EPA has proposed only to repeal the rule, not to replace it. The State and Municipal Intervenors allege that a “pure repeal . . . would put the agency in violation of its statutory duty to regulate carbon dioxide from existing power plants under the Clean Air Act, a duty the agency is not contesting it must fulfill.” Public Health and Environmental Intervenors explain that EPA’s stated grounds for repealing the rule are the same as those raised by petitioners in the CPP litigation. And they claim that EPA is seeking an indefinite abeyance “to avoid the timely clarification and implementation of its statutory duties.” Should the court decide to continue to hold the cases in abeyance, both sets of Intervenors request that the abeyance period be limited to no more than 120 days.

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