Insights

The Climate Report

The Climate Report

The Climate Report is a periodic newsletter that examines some of the topics affecting the field of climate change.

In This Issue

U.S. Regulatory Developments

The Environmental Protection Agency has proposed greenhouse gas emission guidelines for existing power plants that will require 49 states to achieve emission reductions ranging from 11 to 72 percent by 2030. The U.S. Supreme Court has declined to review a federal appeals court decision that California's Low Carbon Fuel Standard does not, on its face, discriminate against interstate commerce. California formally updated its Climate Change Scoping Plan, including amendments to the state's greenhouse gas cap-and-trade program, and conducted its seventh auction of greenhouse gas emission allowances.

Climate Change Issues for Management

The Risky Business Project, established in 2013 by co-chairs Michael Bloomberg, Henry Paulson, and Tom Steyer, seeks to refocus the contentious debate regarding climate change from a political fight to a business discussion by quantifying the economic risks associated with a changing climate. The project has produced a study assessing the substantial business risks presented by climate change in each region of the United States and urges businesses, investors, and the public sector to actively identify and address these risks, just as they have long managed the business risks associated with events such as fire and flood.  

Climate Change Litigation

The Supreme Court has upheld EPA's authority to require "best achievable control technology" for greenhouse gas emissions from sources otherwise subject to the Clean Air Act's "prevention of significant deterioration" requirements, but it rejected EPA's application of PSD requirements solely on the basis of such emissions, as well as EPA's failure to apply the Act's emission thresholds. Murray Energy, supported by nine states, has petitioned the D.C. Circuit Court of Appeals to prohibit EPA from finalizing its proposed rule to regulate greenhouse gas emissions from existing power plants. The Iowa Supreme Court has held that the Clean Air Act does not preempt state common law claims based on in-state air emissions.

Climate Change Regulation Beyond the U.S.

Australia has repealed its carbon tax, while retaining a goal of meeting 20 percent of its energy needs from renewable sources by 2020 and creating a fund to support voluntary greenhouse gas emission reductions. The EU's Court of Justice has ruled that a company failing to surrender sufficient emission allowances under the EU's greenhouse gas program must pay the statutory penalty of 100 Euros per ton of excess emissions, even if it has sufficient allowances in its account. China has amended its Environmental Protection Law for the first time since 1989 to significantly increase the penalties that can be imposed on violating companies and individuals.

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