May 28, 2008

POLAR BEARS WILL NOT PREEMPT

NATIONAL CLIMATE CHANGE REGULATION

Under court order, the Department of Interior (DOI) and the US Fish and Wildlife Service (FWS) have issued a much anticipated Final Rule listing the polar bear as a “threatened” species under the Endangered Species Act (ESA).

The listing, issued May 14, 2008, was a victory for environmental groups, but not all that they had hoped. In issuing the Final Rule, Interior Secretary Dick Kempthorne noted that the listing will “ … protect the polar bear while preventing unintended harm to the society and economy of the United States.” [DOI Press Release dated May 14, 2008, “Secretary Kempthorne Announces Decision to Protect Polar Bears under Endangered Species Act”] The Final Rule made clear that DOI and FWS intend that the listing will not require ESA reviews of existing and proposed permits for facilities that emit greenhouse gas emissions (GHG) in the 48 conterminous states.

Environmental groups had hoped that listing the polar bear as a threatened species would force federal agencies to consult with FWS to review federal actions, including permitting for coal-fired power plants and refineries, to determine whether these actions could have an impermissible impact on the polar bear’s loss of habitat. The American Petroleum Institute (API), in conjunction with the Alaska Oil and Gas Association and other allied trades, filed comments opposing the listing due to the adverse impact the listing would have on oil refineries and coal-fired plants.

The decision to list followed from a petition filed by the Center for Biological Diversity (CBD) with FWS in 2005, in which CBD argued that global climate change is causing a retreat of the Arctic Ocean sea ice cap on which the polar bear depends. On January 9, 2007, FWS issued a proposed rule to list the polar bear as a threatened species under the ESA. However, FWS failed to issue a Final Rule by January 2008. As a result, on March 10, 2008, CBD filed a lawsuit in the District Court for the Northern District of California to compel FWS to issue a Final Rule listing the polar bear. On April 28, the court ordered FWS to issue a Final Rule by May 15, 2008 and ordered that the rule would take effect immediately without the benefit of a 30-day waiting period before the effective date, as is usually provided under the Administrative Procedures Act.

In listing the polar bear, FWS rejected comments arguing that climate change is not likely to occur and that climate change data is a natural phenomenon. Drawing heavily from the Intergovernmental Panel on Climate Change’s Fourth Assessment Report, FWS responded that “most of the observed increase in globally-averaged temperatures since the mid-20th century is very likely due to the observed increase in anthropogenic GHG concentrations.” At the same time, FWS determined that, despite “some existing regulatory mechanisms” designed to address climate change caused by emissions, none are expected to effectively address growth of GHG emissions, much less loss of sea ice, in “the foreseeable future.” According to the Final Rule, the best available scientific data shows that loss of sea ice threatens and will likely continue to threaten polar bear habitat. This loss of habitat puts polar bears at risk of becoming endangered in the foreseeable future, the standard established by the ESA for designating a threatened species.

While the listing, the first attributed to climate change, provides environmental groups with a partial victory, FWS specifically sought to head off efforts to use the listing as a platform for regulating GHG emissions from specific sources or otherwise creating a FWS-led system of GHG regulation. FWS wrote that it “does not anticipate that the listing of the polar bear … will result in the initiation of new section 7 consultations on proposed permits or licenses for facilities that would emit GHGs” in the lower 48 states.”

In the listing action, FWS has taken the position that current scientific data are insufficient to establish a causal connection between such emissions and polar ice melt caused by climate change. In the parlance of the ESA, the scientific data does not support the conclusion that destruction of polar bear habitat is an “indirect effect”—an impact later in time, caused by the proposed action, and “reasonably certain to occur”—of any individual proposed Federal action. FWS found that there is not now enough support to reach the level of a “reasonable certainty” that projects will have an effect on polar ice. This reasoning was also applied to the agency’s refusal to consider the impacts of the consumption of petroleum products yielded by North Slope drilling and pumping operations.

FWS also recognized that allowing the ESA to serve as a back door to initiating source-specific GHG regulation would interfere with policy making at other federal agencies, most notably EPA. Accordingly, FWS also rejected calls for it to mandate that EPA regulate GHG emissions.

In listing the polar bear as threatened, but expressly stating in the Final Rule that it is premature to draw a causal link between individual sources’ GHG emissions in the conterminus 48 states and impact on polar ice caps, FWS sent a strong message that the Endangered Species Act would not be used as a tool to preempt national climate change legislation. The ruling by FWS comes on the heels of efforts to persuade the courts that GHGs are regulated under the Clean Air Act.

There is little doubt that GHG emissions will be regulated in the US, but exactly when and how they will be regulated remains a topic of much debate.