Adela Jones
On August 1, the Council on Environmental Quality (CEQ) released its much-anticipated Final Guidance on Greenhouse Gases and Climate Change. CEQ’s guidance instructs agencies to take a comprehensive, big-picture approach toward the climate impacts of federal actions, thereby providing an interpretation of the existing statute and regulations consistent with what the Sierra Club has been advocating in litigation for years. Overall, the guidance is a step in the right direction and marks the culmination of a six-year process that began with CEQ’s first draft of the guidance in 2010. CEQ could have done more, however, to guide agencies in evaluating the impact of greenhouse gas emissions, and many will see this as a missed opportunity.
The guidance interprets existing obligations under the National Environmental Policy Act (NEPA), which requires all federal agencies to take a “hard look” at the environmental consequences of proposed agency actions, including alternatives that might limit environmental consequences. The statute and its regulations are designed to ensure that both agency staff and the public are aware of these potential impacts before an agency commits itself, on the theory that better information will lead to better decisions.
The Council on Environmental Quality’s final guidance affirms that in examining environmental impacts, agencies must look at the big picture, especially when it comes to climate. Existing NEPA regulations require agencies to consider reasonably foreseeable “indirect” effects of agency actions, including “growth inducing” effects. Courts have agreed with the Sierra Club that because of these requirements, when a federal agency leases coal or increases access to coal supplies, agencies must consider the effects of burning the additional coal made available by the agency’s action. In the context of liquefied natural gas exports, the Sierra Club has consistently argued that when federal agencies are reviewing proposals to export liquefied natural gas, agencies must consider the fact that exports will lead to increases in total U.S. gas production, and thus the environmental impacts of this increase.
What’s in a Name: “Upstream” and “Downstream” Effects
When CEQ published its updated draft guidance in December 2014, it illustrated the scope of the indirect effects analysis by calling on agencies to consider effects “upstream” and “downstream” of the agency’s action in the fossil fuel lifecycle. Although the final guidance no longer uses those specific terms, CEQ’s interpretation of the scope of the analysis is unchanged: the final guidance states that federal agencies considering “resource extraction” projects, for example, must consider the effects of “using the resource,” in addition to the environmental consequences of the extraction itself.
Bolstering the Call for a Programmatic Review of Oil and Gas Leasing
Federal agencies also must look beyond individual actions. For example, rather than considering the climate impacts of individual proposals in isolation, CEQ recommends a “programmatic” approach. CEQ specifically notes that such a programmatic review would be particularly useful when evaluating the climate impacts of the federal oil and gas leasing program--precisely the approach that the Sierra Club and our allies have called for.
Separate from the obligation to consider “cumulative” impacts, CEQ also reiterated that existing regulations require agencies to look beyond the narrow confines of an individual proposal, instead including “connected” actions in the NEPA analysis. The Sierra Club’s pending lawsuit challenging the Federal Energy Regulatory Commission’s approval of the Corpus Christi, Texas, liquefied natural gas export facility argues that the Commission violated this obligation: The Federal Energy Regulatory Commission (FERC) claimed that effects of export-induced increases in gas production were caused by the Department of Energy’s authorization of exports and not by FERC’s approval of export infrastructure, ignoring the obvious connection between the two.
Quantifying Greenhouse Gas Emissions
In the Guidance, CEQ also highlighted the increasing number and capabilities of tools to address impacts on climate change. CEQ recommends that agencies quantify the greenhouse gas impacts of proposed actions and alternatives whenever there are tools to do so. This is a change from the earlier drafts of the guidance, which had only called for quantification for projects expected to emit more than 25,000 metric tons of carbon dioxide equivalent per year. The Sierra Club supports this change; because it will often be easy for agencies to quantify emissions falling below this threshold, there’s no excuse for agencies not to do so. The guidance also identifies analysis by the Energy Information Administration as “objective” and “authoritative,” supporting the Sierra Club’s arguments that the Administration’s forecasts must be considered in evaluating how liquefied natural gas exports and other projects will affect U.S. energy use.
When Will Better Information Lead to Better Decisions?
By taking this broad view, the Council on Environmental Quality’s guidance instructs agencies to capture the full greenhouse gas emission impact of proposed actions. CEQ should have done more, however, to guide agencies in evaluating the significance of these impacts. The Sierra Club has repeatedly identified a number of ways in which agencies can go beyond merely disclosing the tonnage of emissions in evaluating the severity of impacts. For example, agencies can use the federal estimates of the “social cost” of greenhouse gas emissions (both the social cost of carbon and social cost of methane) to help evaluate the severity of the harm caused by increased emissions. Agencies can also assess whether their actions are consistent with the steps needed to attain emission-reduction targets, such as those agreed to by nearly 180 nations at the Paris summit earlier this year. CEQ recognized the availability and usefulness of these tools, but failed to clearly instruct agencies on when they should be used. Nor did CEQ provide any insight into how agencies determine whether the climate impacts of any particular proposal are significant enough to deny a project.
There’s a frequently quoted NEPA regulation that states, “Ultimately, of course, it is not better documents but better decisions that count. NEPA’s purpose is not to generate paperwork—even excellent paperwork—but to foster excellent action.” 40 C.F.R. § 1500.1(c). Whether this improved guidance actually leads to better decisions, particularly on an issue as important and pressing as climate change, remains to be seen.