To attain that goal, the RPS provides production incentives for renewable electricity generation, funded through a surcharge on ratepayers’ electricity bills and administered by the New York State Energy Research and Development Authority (“NYSERDA”).  Eligible renewable electricity generators participate in a competitive solicitation process for the incentives, which are provided based on the megawatt-hours of renewable electricity delivered toNew York ratepayers or used on site. Additionally, the generator transfers all rights to the “RPS attributes” to NYSERDA, so the generator cannot benefit from the resulting pollution reductions under other emissions trading programs.

Most of the incentives to date have gone to wind, hydroelectric, biomass, and landfill gas projects, though a range of other sources – from solar, tidal and wave energy to anaerobic digesters converting agricultural biogas into electricity and heat – are also eligible. Covanta’s prior requests to include waste-to-energy facilities in the RPS, in 2004 and 2010, were both denied by the PSC.

Covanta’s petition presents a controversial question, as waste-to-energy plants provide an alternative to fossil fuels, but simultaneously present a number of environmental issues that are different from those associated with traditional renewable energy sources.  Environmentalists and the New York Attorney General’s Environmental Protection Bureau have opposed the petition, citing, among other things, concerns regarding mercury emissions.

Proponents of waste-to-energy facilities argue that incineration for power production is better for the environment than transporting the waste to landfills.  Covanta submitted a letter to the PSC on December 6th clarifying its position and highlighting the greenhouse gas benefits of waste-to-energy facilities. Covanta reasons that environmental benefits from waste-to-energy production make waste-to-energy a more environmentally-attractive option than landfill gas recovery, a method which is currently RPS-eligible.

A middle ground approach has been adopted in other states, including Connecticut, New Jersey, Massachusettsand Pennsylvania, whereby waste-to-energy facilities may receive subsidies, but not to the same degree as their zero emissions renewable generator counterparts.  DEC officials have supported this compromise as an appropriate measure in the event that the PSC decides to allow waste-to-energy plants in the RPS.

For more information on the firm’s practice in the areas of energy and waste-management, contact Jeff Gracer and Paul Casowitz.

Update (December 14, 2011):  In a recent letter to the PSC, Covanta withdrew its petition to classify waste-to-energy power as renewable under the New York RPS.

The appeals court upheld the trial court’s findings that the parcels at issue are not public parkland, and that even if they were, the proposed project would not substantially intrude upon them. The court explained that public parks are created either expressly, via deed or legislative enactment, or by implication, through continuous use indicating an “unequivocal” intent to dedicate the parcel as public parkland.

The court found that neither of the two parcels at issue, a recreational complex known as Asphalt Green and a pedestrian path known as Bobby Wagner Walk, qualified as public parkland under this test. The court held that Asphalt Green was not expressly dedicated as parkland because it was acquired by the City for non-park purposes and that a 1989 assignment of part of the parcel to the Department of Parks was conditioned on not mapping that part as public parkland. Asphalt Green did not become public parkland by implication, the court reasoned, because it is operated by a non-City entity and because access is restricted 70% of the time to those who pay membership fees.  With respect to Bobby Wagner Walk, the court commented only that it can be “distinguish[ed]…from a park” because the “Department of Transportation owns the property, and it functions primarily as a thoroughfare.”

The new marine transfer station is part of a 2006 strategic plan by Mayor Bloomberg to manage the over 11,000 tons of solid waste the city produces daily. The Comprehensive Solid Waste Management Plan, which according to the New York Times is “affectionately known” as “the Swamp,” was the product of intense negotiations over the equitable siting of new waste facilities in the wake of the closing of the Fresh Kills landfill on Staten Island.

Devin McDougall is a summer associate at Sive, Paget & Riesel

The Firm represented the Natural Resources Defense Council in connection with an amicus brief filed by NRDC in the litigation challenging the City law.  NRDC has been a staunch supporter of producer responsibility principles.  The State Act preempts the challenged City law, effectively mooting that litigation.  A copy of the Act is available here.

There have been significant changes to the laws governing contaminated site cleanup since DER-10 was first published in draft form in December 2002.  The New York Brownfields Cleanup Program (“BCP”) has come into being, and significant changes have been made to the State Superfund statute and its implementing regulations, 6 NYCRR Part 375.  DEC has revised DER-10 to reflect these changes, conform its guidance to the newer regulatory regime, and address concerns from the regulated community that elements of the 2002 draft version of DER-10 were unmanageable or confusing.

The revised DER-10 makes significant changes to chapters addressing remedy selection, site management, periodic review and closeout.  The first chapter, containing general provisions including definitions, was also significantly revised.  In Section 1.3, DEC added definitions and modified others to conform them to the BCP and the modified State Superfund and Part 375 language.  For example, “engineering control” and “environmental easement” were added and cite to their regulatory definitions.  See 6 N.Y.C.R.R. §§ 375-1.2(q), (p).  Other definitions were deleted because they were never used in practice or were poorly defined.  The revised DER-10 also better defines certain elements that are not included in the regulations.  For example, day care facilities, which are not classified in the regulations, are classified as a restricted residential use in the guidance.

One of the major changes to DER-10 is in Section 1.5, which relaxes certain work plan and report certification requirements.  Under the 2002 draft version, DER-10 provided that only a professional engineer licensed or authorized to practice in New York could certify work plans and reports.  The revised 2010 version disposes with this restrictive language, and now creates a spectrum of persons who may prepare and certify work plans and reports, which includes: New York State licensed professional engineers; qualified environmental professionals; remedial parties; and site owners at the time of certification.  While most plans and reports must still be certified by either a qualified environmental professional or NY licensed engineer, remedial parties and site owners may certify periodic review reports if they relate to land or groundwater use restrictions.  The revised DER-10 also includes specific certification language, consistent with the BCP and Superfund Program that must be included on the title page of all submissions and must be fully executed when a document is submitted to DEC’s Division of Environmental Remediation for approval.

Chapter 4 provides the framework for remedy selection and the means and methods to identify, evaluate and select a remedy or alternative remedies to address the contamination at a site.   The section provides detailed reporting and documentation requirements based on whether the site is in the Superfund program (state or federal), BCP, Environmental Restoration Program, Voluntary Cleanup Program, or petroleum spills program.  It also provides DEC’s Remedial Action Objectives (“RAOs”) and preference hierarchy for removing and containing identifiable sources of contamination – removal and/or treatment at the top; treatment of source at point of exposure at the bottom.  See 4.1(d).

Chapter 6 has been significantly revised; sections 6.1 (Site Management), 6.2 (Site Management Plan), and 6.3 (Periodic Review) were added.  Site management, the last phase of the remedial program, commences once a Certificate of Completion (“COC”) or closure letter is issued.  DER-10 describes necessary activities for proper and effective site management, including inspections by the person responsible for site management and reporting of all results in a periodic review report.  The guidance requires that design, implementation, periodic review, and closeout of site management are described in a Site Management Plan (“SMP”); DEC’s website will provide a template for the SMP.

DEC also decided to rescind some TAGMs (Technical and Administrative Guidance Memoranda) developed in the 1980s and 1990s and incorporate the substance of those TAGMs into DER-10.  For example, fugitive dust will no longer be monitored pursuant to a TAGM; instead, a fugitive dust and particulate monitoring program has been included as Appendix 1B in the revised DER-10.  Consolidating these TAGMs into DER-10 will facilitate access to these materials for the regulated community.

DEC is planning to host a training session in Fall 2010 to answer questions and help the public understand the changes in DER-10.  Notice of the meeting will be posted on DEC’s website, and DEC will solicit questions and comments prior to the meeting.

• DER-10: Technical Guidance for Site Investigation & Remediation (pdf)

EPA has proposed two options for managing coal ash.

The first option would regulate coal ash as special waste under the Resource Conservation and Recovery Act’s (“RCRA”) hazardous waste provisions.  Under this option, a comprehensive program of federally enforceable requirements for management and disposal of coal ash would be created.  Measures would be adopted to phase out the wet handling of coal ash.  Additionally, states would be authorized to develop a permit program or use the federally-established program.  This option would include storage, manifest, transport, and disposal requirements for coal ash as well as mechanisms for corrective action and financial responsibility.  Failure to comply would be subject to direct federal enforcement.

The second option would regulate disposal of coal ash under RCRA’s non-hazardous waste provisions.  EPA would set performance standards for waste management facilities that handle coal ash.  States that adopt their own coal ash management programs would be responsible for enforcing the rule and would have the option to establish a permit program.  Surface impoundments built after the rule goes into effect would be required to have composite liners, but there will be no land disposal restrictions.  Although citizen suits could be filed for failure to comply with the rule, this option does not provide for direct federal enforcement.  This option also does not provide for any financial assurances, but EPA plans to develop a proposed regulation pursuant to the financial assurance requirements in Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”) § 108(b) that would cover coal ash facilities.  This option would go into effect earlier than the first option.

Under both options, landfills that accept coal ash will be required to conduct groundwater monitoring, even if they were built before the Proposed Rule is finalized.  Landfills built after the rule goes into effect would also have to install liners.  The Proposed Rule does not address depositing coal ash as backfill in mines, known as minefills.  Nor does it affect the current status of coal ash that is beneficially reused.  The Bevill exemption, which lists specific wastes that are exempt from regulation under RCRA, includes the beneficial reuse of coal ash (e.g., fly ash in cement and concrete).  However, EPA is soliciting comments regarding the uses of coal ash in unencapsulated form, such as in road fill and agricultural applications.  EPA is also soliciting comments on how to define “beneficial use.”  Based on the comments submitted, EPA could determine that unencapsulated uses should be regulated or could redefine which “beneficial uses” remain exempt.

Once the proposed rule is published in the Federal Register, the public will have 90 days to submit comments.

For more information about the Proposed Rule and how to submit comments visit EPA’s website.

Industry representatives believe that regulating coal ash under RCRA would negatively impact companies who produce the ash as well as companies who beneficially reuse it (e.g., as structural fill or agricultural uses).  Tom Addams, executive director of the American Coal Ash Association, a utility industry group, stated “[a] hazardous determination would make builders reluctant to use coal ash not because of what it may contain, but because of tort activity. If litigation was filed on a national basis, it would be mind-boggling to see what the defense costs were.”   Industry representatives also believe that the toxic materials in coal ash are not in high enough concentrations for the ash to be regulated as “hazardous.”

Environmental groups want coal ash to be regulated as a “hazardous waste” because it contains mercury, lead, and other potentially toxic constituents.  Representatives of these groups are concerned that industry may influence the outcome of the proposed rule.

The coal ash proposal could be published in the coming weeks.

More information about the meetings between industry, environmental groups and OMB is available at the OMB website.

• NY State may begin collecting 80% of the unclaimed deposits on all non-water bottled beverages from the bottling industry;
• The beverage industry is required to increase the handling fees paid to redemption centers for taking empty bottles;
• All provisions involving “bottled water” cannot go into effect until at least October 22, 2009 when a follow up hearing will be held; and
• No decision was rendered on the New York-specific UPC bar code.

The Bill, which was passed in April, was challenged in May when Nestle, the Polar Corp., and the International Bottled Water Association (collectively, the “water companies”) filed suit in the U.S. District Court for the Southern District of New York.  The water companies claimed that the Bill was unconstitutional because it violated the Dormant Commerce Clause, the Equal Protection Clause, and Substantive Due Process of the U.S. Constitution.  Judge Thomas P. Griesa of the United States District Court in Manhattan ruled in favor of the water companies when he determined that certain provisions of the Bill were unconstitutional.  In particular, the requirement that a NY State-specific UPC be placed on all bottles sold in the state was found unconstitutional due to infringement on interstate commerce.  For more information on Judge Griesa’s reasons for issuing the preliminary injunction see our prior post on that ruling.

Following the injunction halting the Bill’s implementation, NY State Attorney General Andrew Cuomo (“A.G.’s Office”), moved for an emergency hearing to modify Judge Griesa’s order.  The A.G.’s Office was particularly concerned that delay in implementing the Bill would cost the State $86 million by March 31, 2010 because the Bill includes a provision that requires the beverage companies to turn over 80% of their unclaimed deposits to the State for environmental programs and general disbursement through the fund.  After the Bill’s passage, its projected revenue figures were included in the State’s 2010 budget, and early estimates suggested that as much as $115 million a year could be generated from the collection of unclaimed deposits.  The A.G.’s Office also argued that the $10,000 bond should be increased to as much as $115 million to account for the State’s significant loss in revenue because the preliminary injunction delayed the State’s ability to collect the unclaimed deposits.

Judge Batts’ order first acknowledged that each party was in agreement that the State Legislature had to review and modify the NY State-specific UPC requirement.  As a result, the State did not press the NY State-specific UPC issue and Judge Batts did not answer any questions relating to it.  Next, the order modified the Bill’s provisions relating to all bottled beverages other than water.  Specifically, the provisions regarding the State’s ability to collect 80% of unclaimed deposits and the increase to the current handling fee from 2 cents to 3.5 cents were found constitutional because they were created as a “rational means to increase State revenue.”  Order at 8.

In addition, the order addressed the Bill’s provisions relating to bottled water and found that legal questions remained as to whether the Bill’s requirement that the bottled water industry be in compliance by October 1, 2009 violated due process.  This issue will be addressed further at an October 22, 2009 hearing.  Finally, Judge Batts refused to increase the $10,000 bond by finding that balancing the Plaintiff’s likelihood of success on their Dormant Commerce Clause challenge as well as the hardship to Plaintiffs posting such a large bond against the loss to the State as a result of the Court-ordered injunction does not merit an increase in the bond amount.”  Order at 11-12.

As a result of the emergency hearing, a majority of the Bill’s provisions can now be implemented.  The only provision that remains enjoined is the requirement that a NY-specific UPC be created.  The due process question regarding the Bill’s bottled-water provisions will be heard on October 22, 2009.

The regulations at issue are required under the federal Superfund law, the Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”), passed in 1980.   The statute is commonly said to have been motivated by the notorious hazardous waste contamination discovered buried at Love Canal, NY.   Section 108 of CERCLA requires EPA to issue financial assurance requirements for certain types of facilities, based on the risk of injury from hazardous substances in operations at those facilities.  The regulations, once issued, would require the operator of a covered facility to set aside funds or otherwise make funds available for a possible future cleanup of hazardous substances at the property.  Without such funds, costly cleanups may force potentially responsible parties into bankruptcy leaving taxpayers with the bill, or lengthy litigation may ensue over the allocation of costs.   EPA was first required to publish a notice of those classes of facilities which presented the “highest level of risk of injury”  by December 11, 1980.  CERCLA § 108(b)(1).

The December 1980 deadline passed, without EPA publishing the required notice.  The statutory requirement languished, until in recent years it received renewed attention.  EPA was sued in federal court in 2008, on the theory that EPA had failed to perform a non-discretionary duty under CERCLA.  The suit was brought under to CERCLA’s citizen suit provision, which allows a private litigant to force non-discretionary agency action.  In February 2009, the Northern District of California held in Sierra Club v. Johnson (N.D. Cal. No. C 08-01409) (“Johnson“), that EPA had a mandatory duty to publish classes of facilities which presented the greatest risk of injury.  In July, 2009, EPA published a notice these classes of facilities in the Federal Register, pursuant to the court’s order.  In its notice, the agency determined that it would promulgate the first financial assurance requirements for hardrock mining facilities, based on the extent of contamination from such facilities, and the high costs of cleanup.

EPA did not limit its inquiry to hardrock mining; the notice also stated that EPA will examine the need for financial assurance at the following types of facilities: “hazardous waste generators, hazardous waste recyclers, metal finishers, wood treatment facilities, and chemical manufacturers.”  74 Fed. Reg. 37,219.  EPA states that it intends to publish a notice of this “second wave” of types of facilities by December, 2009.  Id.

However, the Northern District of California held that EPA is under no date-certain deadline to issue the financial assurance requirements.  Instead, the court held, “that although Section 108(b) requires EPA to promulgate financial responsibility regulations and incrementally impose such requirements, Section 108(b) provides EPA with discretion as to when to promulgate such regulations.  Unlike the duty to publish notice of classes, Section 108(b) does not include a date-certain deadline for the promulgation of financial responsibility regulations …” Johnson, Order, at 4-5 (Aug. 5, 2009).  In so doing, the court rejected “a bright line rule that only duties with date-certain deadlines are non-discretionary for the purpose of citizen suits under CERCLA,” and instead looked to legislative history to help determine whether EPA’s duty to promulgate regulations by a particular date was non-discretionary.   Id. at 5.

To maintain a claim that EPA has “unreasonably delayed” its duties under CERCLA, the court held that plaintiffs may continue to press their claims under another statute, the Administrative Procedure Act (APA), but must do so in another court.  The court stated, “plaintiffs may bring an APA claim in the Court of Appeals for the D.C. Circuit alleging EPA unreasonably delayed in promulgating the financial responsibility regulations required under Section 108(b).”  Id. at 6.  Unless and until such a litigation is brought and decided, the timeline for financial assurance requirements under CERCLA will remain unclear.

• Read the initial court decision in Sierra Club v. Johnson (pdf)
• Read the latest order in Sierra Club v. Johnson (pdf)
• Read EPA’s Federal Register Notice regarding classes of facilities under CERCLA 108 (pdf)

In addition to the cleanup of Superfund sites, potentially responsible parties under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) may also be held liable for harm to natural resources caused by the release of hazardous substances, known as natural resource damages (NRD).  Natural resources as defined by the statute include “land, fish, wildlife, biota, air, water, ground water, drinking water supplies, and other such resources belonging to, managed by, held in trust by, appertaining to, or otherwise controlled by the United States … any State or local government, any foreign government, [or] any Indian [T]ribe.” 42 U.S.C. § 9601(16).  These governmental “trustees” are responsible for pursuing NRD claims.

In State of Oklahoma v. Tyson Foods, Inc., the Oklahoma Attorney General sued several Arkansas poultry farms under CERCLA for the contamination of the Illinois River watershed.  On July 22, the U.S. District Court for the Northern District of Oklahoma rejected these NRD claims since the state had not joined the Cherokee Tribe, a trustee with jurisdiction over parts of the river.  The court held that the Tribe was an indispensable party to the lawsuit, and without the participation of the Tribe or a clear division of the amount of natural resources held by each trustee, it dismissed the NRD claims under Rule 19 of the Federal Rules of Civil Procedure (“Required Joinder of Parties”).  2009 WL 2176337 (N.D. Okla. 2009).

The Tyson Foods decision conflicts with others that have indicated a single trustee may bring CERCLA claims for the full amount of natural resource damages, even in the absence of other affected trustees.  See, e.g., United States v. Asarco, Inc.,  471 F.Supp.2d 1063 (D. Idaho 2005).  If Tyson Foods stands, the decision could render recovery of NRD under CERCLA more difficult, especially where a governmental PRP also happens to be a trustee of the affected resources.

• View a complete copy of the decision here (pdf)

The Bill sought to expand the definition of “container” by including all bottles of water sold in the state.  Governor David A. Paterson’s office introduced the Bill to the state Legislature in January 2009, with a definition of “water” that included drinks made with sugar, such as juices, iced teas, or sports drinks.  The state legislature was hesitant to accept this definition and after negotiations, the Bill redefined “water” to include “any beverage identified through the use of letters, words or symbols on its product label as a type of water, including any flavored water or nutritionally enhanced water, provided, however, that ‘water’ does not include any beverage identified as a type of water which a sugar has been added.” N.Y. Envtl. Cons. L. § 27-1012.10.

Some New Yorkers found the distinction between water with sugar added and water with no sugar added particularly odd since last year Governor Paterson’s office introduced legislation to place an “obesity tax” on all drinks made with sugar.  The “obesity tax” legislation was dropped shortly after it was introduced but the distinction between types of water was passed along with the Bill in April.  Judith Enck, Governor Paterson’s Deputy Secretary for the Environment, recently answered questions about the distinction, stating that “[t]he Legislature only wanted to do water” and that “this was a necessary compromise to get the bill through.”

In addition, the Bill requires all bottled beverages sold in NY to have a special NY State-specific product code (UPC) registered with the State.  The Legislature included this provision as a means of preventing bottles sold and purchased outside of the state from coming into the state for the five cent redemption.  The provision states “such universal product code shall be New York state specific, in order to identify the beverage container as offered for sale exclusively in New York state, and as a means of preventing illegal redemption of beverage containers purchased out-of-state.” N.Y. Envtl. Cons. L. § 27-1012.10.

The Bill also includes a provision requiring beverage companies to return 80% of the unclaimed deposits to the state’s General Fund.  N.Y. Envtl. Cons. L.  § 27-1012.4.  Recent estimates suggest that the amount of unclaimed deposits could reach as much as $115 million in 2010 (pdf).  Some of the funding is slated to go towards environmental protection projects, while the rest is being considered for general disbursement throughout the State’s budget.

The Bill passed in April and was supposed to go into effect on June 1, 2009.  However, in May, Nestle, the Polar Corp., and the International Bottled Water Association (collectively “water companies”) filed suit in the U.S. District Court for the Southern District of NY against the implementation of the Bill.  The water companies claimed that the Bill was unconstitutional because it violated the Dormant Commerce Clause, the Equal Protection Clause, and Substantive Due Process.

In particular, the water companies argued that the requirement of a state specific UPC label identifying water containers “offered for sale exclusively in New York State” violated the Dormant Commerce Clause.  N.Y. Envtl. Cons. L. § 27-1012.10.  The water companies also claimed that the Bill’s exemption of water containing sugar from the definition of “water” violated Equal Protection.  Finally, the water companies cited the unreasonably short amount of time to implement many of the Bill’s provisions as a violation of substantive due process.

Late last week, the water companies’ request for a preliminary injunction was granted.  Judge Griesa’s order enjoined the enforcement of all provisions of the Bill until April 1, 2010, citing the allegedly “impossible” deadline for compliance with the Bill.  This will give water bottlers and distributors additional time to reach compliance with the Bill’s other provisions.  Judge Griesa’s order also found the requirement that a NY State-specific UPC be placed on all bottles sold in the state unconstitutional due to infringement on interstate commerce.  In the court transcript, Judge Griesa acknowledged the Legislature’s concern of potential fraud from out of state bottles seeking redemption.  However, Judge Griesa made it clear that “[r]egardless of the purpose of the legislature in enacting this provision, the provision is a violation of the commerce clause.”

The problem Judge Griesa noted was that the Bill required bottles with the UPC to be marketed exclusively in NY.  This action would prevent commerce of the bottles sold outside of NY by making it illegal to sell the bottles outside of NY State.  Judge Greisa did not address the water companies’ Equal Protection claim, but such claims are generally difficult to prevail on absent a plaintiff in a protected class which allows heightened scrutiny of a law.

The preliminary injunction may have the Bill on pause but it does not appear to be the end of the Bill.  The New York Times has reported that Governor Paterson’s office is working with the State Legislature on modifications to the law.  A spokesperson for Governor Paterson also told reporters that they were reviewing Judge Griesa’s order and considering an appeal.