We provide some background on NEPA, as well as an overview of CEQ's draft guidance. We also highlight a recent legal settlement involving NEPA, greenhouse gas emissions (GHGs), and oil and gas leasing, which caused, among other things, substantial legal uncertainty for federal oil and gas leaseholders.
Unfortunately, NEPA's guidance fails to resolve any of the central questions at issue in this and other similar cases. This is why Congress must pass
S. 3230, the NEPA Certainty Act, which would prohibit consideration of GHGs and climate change under NEPA.
Issue: A number of court decisions and legal settlements on climate change have pushed NEPA beyond its traditional scope. On February 18, 2010, Nancy Sutley, Chair of CEQ, issued a
draft guidance memorandum to help federal agencies consider the effects of GHG emissions and climate change in their NEPA evaluations. Unfortunately, the guidance is vague and offers no bright lines to clearly direct the way in which federal agencies incorporate climate change into NEPA analyses.
Background of NEPA: Signed into law on January 1, 1970,
NEPA established "a national environmental policy and goals for the projection, maintenance, and enhancement of the environment." Moreover, NEPA created "a process for implementing these goals within federal agencies." NEPA's purpose is to ensure that federal agencies carefully consider information concerning significant environmental impacts of federal actions, and to make this information available to the public. NEPA also created CEQ, which was designed to oversee NEPA implementation.
The NEPA process requires federal agencies to use a "systematic interdisciplinary approach" to incorporate environmental considerations in their planning and decision-making processes. NEPA has three levels of analysis, each of which depends on whether the federal action could significantly affect the environment:
1) Categorical exclusion: As CEQ explains, such exclusion describes "a category of actions that do not typically result in individual or cumulative significant environmental effects or impacts." Such exclusions serve a "beneficial purpose," which is that they can help federal agencies expedite environmental reviews.
2) Environmental Assessment: The second level of NEPA analysis involves the preparation of a written environmental assessment (EA), which explores whether a federal action would significantly affect the environment. If the EA determines that the federal action would result in "no significant impact" on the environment, then the agency issues a finding of no significant impact (FONSI). If, however, the EA determined that there may be a significant impact, the third level of analysis, an environmental impact statement (EIS), is triggered.
3)Environmental Impact Statement: An environmental impact statement, or EIS, is a more detailed evaluation of the proposed federal action that includes an analysis of more environmentally stringent alternatives to the action and allows the public, other federal agencies, and outside parties to provide input into its preparation, including providing comments on a draft EIS. Federal agencies have the option, if they anticipate their action may significantly impact the environment, to prepare an EIS without first having to prepare an EA.
CEQ Guidance: According to CEQ, the draft GHG guidance covers the "ways in which Federal agencies can improve their consideration of the effects of greenhouse gas (GHG) emissions and climate change in their evaluation of proposals for Federal actions under the [NEPA]." It is intended to help federal agencies analyze climate change issues in consideration of:
1) The GHG emissions effects of a proposed action and alternative actions; and
(2) The relationship of climate change effects to a proposed action or alternatives, including the relationship to proposal design, environmental impacts, mitigation, and adaptation measures.
At first blush, CEQ's guidance appears measured and reasonable. For example, CEQ recognizes the difficulty inherent in assessing GHG impacts from a single source. " From a quantitative perspective," CEQ wrote, "there are no dominating sources and fewer sources that would even be close to dominating total GHG emissions." CEQ acknowledges further that the "global climate change problem is much more the result of numerous and varied sources, each of which might seem to make a relatively small addition to global atmospheric GHG concentrations." Therefore, CEQ proposes to "recommend that environmental documents reflect this global context and be realistic in focusing on ensuring that useful information is provided to decision makers for those actions that the agency finds are a significant source of GHGs."
Yet, rather than clearly direct how federal agencies should follow these common-sense principles, CEQ offers only vague guideposts, which means federal agencies retain an enormous amount of discretion in how they assess GHG impacts in the context of NEPA.
CEQ attempts to provide a bright line in suggesting that a useful starting point for GHG analysis is whether an action results in 25,000 tons or more of GHGs annually. In CEQ's view, "if a proposed action would be reasonably anticipated to cause direct emissions of 25,000 metric tons or more of CO2-equivalent GHG emissions on an annual basis, agencies should consider this an indicator that a quantitative and qualitative assessment
may be meaningful to decision makers and the public." [Emphasis added] However, CEQ then notes that it does not "propose" the 25,000-ton level "as an indicator of a level of GHG emissions that may significantly affect the quality of the human environment, as that term is used by NEPA," but "notes that it serves as a minimum standard for reporting emissions under the Clean Air Act."
CEQ further blurs the 25,000-ton line for "long-term actions" that emit
less than 25,000 tons annually. Federal agencies can, according to CEQ, "consider" whether the action's "long-term emissions should receive similar analysis."
NEPA, GHG and Cumulative Effects
When it comes to analyzing the cumulative effects of GHGs under NEPA, CEQ's guidance is equally vague, as it fails to provide clear rules and standards that federal agencies must follow. According to CEQ, when "an agency concludes that a discussion of cumulative effects of GHG emissions related to a proposed action is warranted to inform decision-making, CEQ recommends that the agency do so in a manner that meaningfully informs decision makers and the public regarding the potentially significant effects in the context of the proposal for agency action." This is most appropriately done, in CEQ's opinion, by "focusing on an assessment of annual and cumulative emissions of the Federal action and the difference in emissions that are associated with alternative actions."
CEQ also states that federal programs that "affect emissions or sinks and proposals regarding long range energy, transportation, and resource management programs" can "
lend themselves" to a broad or "programmatic approach
" in NEPA decision making. [Emphasis added] Here again, CEQ's guidance fails to guide; federal agencies have ample room to decide how a cumulative effects analysis should occur.
NEPA, GHGs and Lawsuits
In sum, CEQ's guidance does nothing to stop the wave of litigation concerning NEPA analysis and climate change. That litigation is having a direct impact on jobs and energy production. Consider the case of
Montana Environmental Information Center v. United States Bureau of Land Management (BLM). The case was filed on January 15, 2009 and was privately settled on March 18, 2010, when BLM agreed to suspend 61 oil and gas leases previously issued covering nearly 38,000 acres of land. In the settlement agreement, BLM stated that it has
the authority to void or terminate any lease it deems appropriate.
Similar litigation is pending in New Mexico, where 34 BLM oil and gas leases are being challenged for an alleged failure to consider climate change impacts under NEPA. Also, future oil and gas lease sales in Montana, North Dakota and South Dakota have been delayed pending additional analysis of the GHG and climate change impacts of those leases.
Simply put, delaying these leases has immediate negative impacts on jobs, economic growth, and energy dependence, and it raises serious doubts about the legal certainty of holding federal oil and gas leases.
Conclusion: While we applaud CEQ's attempt to provide boundaries to NEPA GHG analysis, its guidance does little, if anything, to resolve the critical legal and policy questions surrounding this issue. CEQ provides few concrete rules or steps agencies must follow in analyzing the GHG impacts of individual projects under NEPA. And one could argue that the guidance in fact worsens the status quo, as federal agencies now have official sanction from CEQ to continue their subjective and uncertain application of NEPA to climate change issues.
To resolve the uncertainties inherent in GHG issues under NEPA, Sen. James Inhofe (R-Okla.), Ranking Member of the Senate Committee on Environment and Public Works, along with several cosponsors, recently introduced
S. 3230, the NEPA Certainty Act, which prohibits the use of NEPA to document, predict, or mitigate the climate effects of specific federal actions.
