Fueling the Future The U.S. once ran entirely on coal and oil. But - PDF document

Winter 2007 Fueling the Future The U.S. once ran entirely on coal and oil. But that is changing. New sources of energy that can power the economy are rapidly going online. The energy choices have expanded to include biodiesel, ethanol and synfuels. And we are learning to conserve by building more efficiently and using other choices, such as wind or solar. Synthetic fuels worked in the past. They may have a place now. p. 8 The economics of ethanol can work. And we don’t need corn to make it. p. 12 Greenhouse gas is a legal issue. Thank the polar bear. p. 21 Energy demand projected to 2030. Scenarios for what might be ahead. p. 19 Also Inside: Coal Bed Methane • Financing Alternatives • Effjcient Buildings “Alternative” Investments • Global Warming

CLIMATE Reprinted from the 2007 Winter issue of Energy Magazine Coping with Carbon Dioxide Greenhouse emissions are an issue in court rooms and board rooms. By John F. Spinello, Jr., Craig P. Wilson, Sandra Y. Snyder T he year just-ended, 2006, brought have fjled lawsuits to compel the United The proposal to list the polar bear significant legal developments States Environmental Protection Agency cites receding sea ice as the only signifj- concerning global climate change (USEPA) to regulate the emission of cant threat to the species, and rules out (the trends observed in the warming of carbon dioxide under the Clean Air Act other potential factors, such as oil and the earth’s surface temperature) that (CAA); States have banded together to gas development and subsistence hunt- affect the energy sector in the United establish regional regulatory programs ing by Native Alaskans. Most of a polar States and worldwide. This trend of to mandate GHG reductions from the bear’s life is spent on sea ice hunting for increasing legal activity and policy debate energy sector; State Attorneys General seals and other prey, and according to surrounding the issue of climate change have sued energy companies claiming scientifjc observations, sea ice has been is a refmection of the ever-increasing at- GHG emissions are a common law nui- receding since 1978 in some areas of tention focused on the issue by scientists, sance causing millions of dollars in dam- the Arctic Sea by nearly 10 percent per economists, advocacy and independent ages; and private litigants have sought decade. research groups, and policy makers here to fjx responsibility for damages caused The potential listing is signifjcant be- and abroad. The New Year now upon us by severe weather on GHG emitters in cause the ESA prohibits federal actions promises even more signifjcant develop- the energy sector. These are just a few that are likely to harm a listed species ments in this area. examples of the growing trend of legal or its habitat. Specifjcally, Section 7 of Emissions of carbon dioxide (CO 2 ), action in this area that will continue to the ESA requires all federal agencies to the most pervasive anthropologic green- unfold in 2007, in addition to a widely consult with the FWS and insure that house gas (GHG) in the atmosphere, expected increase in congressional at- any action the federal agency takes, “is represent about 84 percent of total GHG tention to climate change in the 110 th not likely to jeopardize the continued emitted in the United States. Most CO 2 Congress—all of which raise signifjcant existence of any endangered species (98 percent) is emitted as a result of the legal issues for energy companies and or threatened species or result in the combustion of fossil fuels such as coal, their counsel. destruction or adverse modifjcation of oil, and natural gas. Consequently, CO 2 The Polar Bear emissions and energy use are highly cor- About the Authors related. CO 2 has a lifetime or residence On December 27, 2006, the U.S. Fish time of roughly 50 to 200 years, and is and Wildlife Service (FWS) proposed list- John Spinello is a Partner in the Newark, NJ office of K&L Gates. His practice mixed throughout the lower stratosphere ing the polar bear as threatened under focuses on regulatory counseling, environmental litigation, and legislative in relatively homogeneous concentra- the Endangered Species Act (ESA), due and regulatory advocacy for clients that include power plants and chemical manufacturers. He may be reached john.spinello@klgates.com. tions everywhere along the surface of to melting sea ice caused by climate the earth. change. Interior Secretary Dirk Kemp- Craig Wilson is a Partner in the Harrisburg, Pa. office of K&L Gates. His The legal and policy debate regarding thorne, said, “we are concerned the polar practice is concentrated in the areas of environmental compliance counseling the management of GHG emissions is bears’ habitat may literally be melting.” and transactional advice, environmental permitting, zoning and land playing out vibrantly in boardrooms, The listing proposal follows a petition development He may be reached at craig.wilson@klgates.com. courtrooms, and statehouses across the fjled by the Natural Resources Defense country. For example, investors have Council (NRDC) and other environmental Sandra Snyder is an Associate in the Newark, NJ office of K&L Gates. Ms. been demanding greater disclosure of groups asserting GHG emissions must Snyder concentrates her practice in environmental and natural resources law GHG emissions and analysis of the as- be reduced to prevent the elimination and related litigation. Prior to joining K&L Gates, Ms. Snyder worked as a sociated risks and opportunities; States of polar bear habitat by the end of the chemical engineer for ExxonMobil. She may be reached at Sandra.snyder@ and environmental advocacy groups century. klgates.com. e nergy 21 Winter 2007