Federal Agencies Should Consider Climate Change When Reviewing Environmental Effects on Projects, Says Council on Environmental Quality

The Council on Environmental Quality (CEQ) published draft guidance on February 23, 2010, advising federal agencies how to consider climate change and greenhouse gas (GHG) emissions in their review of the environmental effects of proposed projects under the National Environmental Policy Act (NEPA). Increased attention to climate change may complicate and lengthen the environmental review process, raise the prospect of disputes and litigation, and increase pressure for project modifications or other measures to reduce GHG emissions or mitigate effects relating to climate change.

NEPA is the nation’s most extensive environmental law. Other laws typically focus on specific media (such as air, water, or land), specific activities (such as surface mining or releases of hazardous substances), or specific places, flora, or fauna (such as wilderness areas or endangered species). NEPA regulates the actions of all federal agencies in all of these areas. It requires federal agencies to ascertain, disclose, and consider the environmental implications of actions they propose to undertake, fund, or permit. While NEPA directly governs only federal agencies, it effectively regulates many actions of private persons as well as state and local governments, since their activities often entail federal funding or approval.

Generally, NEPA calls on federal agencies to discuss the environmental effects of proposed projects and alternatives to such projects either in a relatively brief Environmental Assessment (EA) or, if the project may significantly affect the environment, in a much longer Environmental Impact Statement (EIS). EAs typically are prepared in less than a year, while EISs commonly require two, three, or more years to prepare.

Since 2003, several federal courts have ruled that, in some circumstances at least, federal agencies should consider GHG emissions in their NEPA analyses. In its draft guidance, CEQ, the agency charged with advising other federal agencies on implementation of NEPA, offers more detailed advice on when and how they should perform that analysis. CEQ calls on federal agencies to consider GHG emissions and climate change in two respects:

1. the effect of a proposed project’s GHG emissions on climate and
2. the effect of climate change on the proposed project. It emphasizes that the aim is to “provide meaningful information to decision makers and the public” and “avoid[] useless bulk and boilerplate documentation, so that the NEPA document may concentrate attention on important issues.”

With respect to the effects of a proposed project on climate, the draft guidance suggests that for projects “reasonably anticipated” to cause direct emissions of 25,000 tons or more of carbon dioxide (CO2) equivalent annually, federal agencies should consider this threshold “an indicator that a quantitative and qualitative assessment may be meaningful to decision makers and the public.” (That amount—corresponding roughly to annual GHG emissions of 4,500 to 5,000 cars—is the threshold the EPA uses for triggering reporting requirements under the Clean Air Act.) For projects emitting less, CEQ still encourages agencies to consider whether the project’s emissions should receive similar analysis. CEQ clarifies, though, that it does not propose this reference for use as a measure of indirect effects, the analysis of which, it says, “must be bounded by limits of feasibility in evaluating upstream and downstream effects” of projects. Nor does it propose it for use as a threshold of “significance” for determining whether to prepare an EIS rather than an EA. In analyzing direct effects, CEQ advices it would be appropriate to

1. “quantify cumulative emissions over the life of the project;
2. discuss measures to reduce GHG emissions, including consideration of reasonable alternatives; and
3. qualitatively discuss the link between such GHG emissions and climate change.” “It is not currently useful,” though, says CEQ, “for the NEPA analysis to attempt to link specific climatological changes, or the environmental impacts thereof, to the particular project or emissions, as such direct linkage is difficult to isolate and understand.”

CEQ also recommends, rather cryptically, that where an agency discusses cumulative effects of GHG emissions related to a proposed project, it should “do so in a manner that meaningfully informs decision makers and the public regarding the potentially significant effects in the context of the proposed agency action,” which “would most appropriately focus on an assessment of annual and cumulative emissions of the proposed action and the difference in emissions associated with alternative actions.” CEQ also encourages federal agencies to consider particular climate change impacts on vulnerable communities.

With respect to the effects of climate change on projects, CEQ observes that climate change may affect a proposed project in a variety of ways, including exposing it to a greater risk of floods, storm surges, or higher temperatures. It offers the example of a facility drawing water from a stream that is dwindling as a result of decreased snowpack in the mountains or that is becoming warmer owing to increasing atmospheric temperatures. Climate change effects should be considered, CEQ advices, in analyzing projects designed for long-term utility and located in areas vulnerable to specific effects of climate change, such as increasing sea level or ecological shifts.

Pointing to NEPA’s rule of reason, CEQ adds that “agencies need not undertake exorbitant research or analysis of projected climate change impacts in the project area or on the project itself, but may instead summarize and incorporate by reference the relevant scientific literature.” Agencies should as well, CEQ cautions, be mindful of “the uncertainties associated with long-term projections from global and regional climate change models” and “disclose these limitations in explaining the extent to which they rely on particular studies or projections.”

CEQ invites comments on its draft guidance by May 24, 2010, and poses several specific questions, including whether it should provide guidance on determining whether GHG emissions are “significant” for NEPA purposes and, if so, what level of emissions should be considered to have significant “cumulative effects.” Any such guidance could effectively determine which of thousands of projects federal agencies fund or approve each year will require preparation of an EIS.

David Ivester
Briscoe Ivester & Bazel LLP
155 Sansome Street, 7th Floor
San Francisco, CA 94104
Telephone: (415) 402-2700
Fax: (415) 398-5630

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