November 1, 2021

WVDEP Working on Permitting Rules for Storage of Captured CO2

GO-WV News

By Christopher (Kip) Power

The West Virginia Department of Environmental Protection (WVDEP) is continuing work on rules for permitting of geologic storage of captured CO2 — a necessary (but not sufficient) element in developing a CCS industry.

As discussed in the August GO-WV News, the WVDEP released proposed amendments to its Underground Injection Control (UIC) permitting and related regulations (47 CSR 13) on June 23, 2021 and held a public hearing on the proposed rules on July 23, 2021. Although they include substantial changes to the rules for Class 1 permits (governing hazardous waste injection wells) and Class 2 permits (for enhanced recovery of oil and gas, and disposal of produced water), the rule changes primarily consist of an entirely new section establishing a permitting program for Class 6 wells (those used for injecting carbon dioxide for the purpose of permanent geologic sequestration). Those proposed new Class 6 rules are largely modeled on EPA’s detailed “Class VI” regulations promulgated under the federal Safe Drinking Water Act (40 CFR 146).

Ten organizations (including GO-WV and several environmental/citizen groups) filed comments on the draft amendments, and a few of their representatives spoke at the hearing. By letter dated July 23, 2021, the WVDEP released copies of the written comments it received, along with its responses. There was a total of 10 comments that the WVDEP considered to be meritorious enough to alter the proposed rule language in minor ways, almost all of which consisted of typographical errors (along with the elimination of the use of Roman numerals for identifying the “classes” of permits). The final agency-approved rule proposal was filed with the Legislative Rule-Making Review Committee on July 30, 2021 (incorporating most, but not all, of the edits mentioned in the WVDEP’s July 23 letter).

October 27, 2021

How FinTech is Upending a Traditional Industry

Smart Business

(by Sue Ostrowski featuring Moore Capito)

For years, the banking industry has functioned in the same ways it always has. But FinTech — financial technology — is revolutionizing the way things are done and increasing access to financial tools for those who may not have previously had it.

“At its core, FinTech is when you have the convergence of an emerging technology and a financial service,” says Moore Capito, shareholder at Babst Calland. “It’s using innovation to compete with traditional methods of delivering financial services.”

Smart Business spoke with Capito about how FinTech is revolutionizing the financial industry, the opportunities it presents and challenges it poses.

How is Fintech Changing the Financial Industry?

There are a lot of unbanked, or underbanked, people that have difficulty accessing the traditional banking industry. FinTech products, sometimes in collaboration with a traditional bank, can provide better financial services to these individuals, especially in rural areas where there is less access to bricks-and-mortar banks.

There are potentially endless applications, from insurance to mobile banking, cryptocurrency, investment apps, and financial products including mortgages — the most well-known being PayPal. The onset of COVID accelerated the necessity and the willingness to adapt with FinTech, doing more transactions remotely from phones and bringing finance directly to individuals, instead of individuals going to a physical banking location.

On the economic development side, entrepreneurs are coding programs that create the functionality behind the apps. And states such as West Virginia have created regulatory sandboxes for FinTech entrepreneurs. These let participants apply to come in and test their products in the marketplace without going the traditional regulatory route, allowing them to become viable and ready for commercialization before becoming regulated by state agencies.

October 28, 2021

2021 PFAS Strategic Roadmap Outlines EPA’s Whole-of-Agency Approach to Addressing “Forever Chemicals” through 2024 and Beyond

Environmental Alert

(by Matt Wood and Mackenize Moyer)

On October 18, 2021, the U.S. Environmental Protection Agency (EPA) released its comprehensive strategy for addressing per- and polyfluoroalkyl substances (PFAS), “PFAS Strategic Roadmap: EPA’s Commitments to Action 2021–2024” (Roadmap).  PFAS are a large group of manmade chemicals that have been widely used in various consumer, commercial, and industrial applications since the around 1940s and more recently have been discovered in environmental media (e.g., groundwater), as well as in plants, animals, and humans.  PFAS do not tend to break down naturally, and evidence suggests that exposure to PFAS can lead to adverse health effects.  As such, the EPA Council on PFAS, established by EPA Administrator Michael S. Regan in April 2021, developed the Roadmap to “pursue a rigorous scientific agenda to better characterize toxicities, understand exposure pathways, and identify new methods to avert and remediate PFAS pollution.”[1]

The Roadmap highlights EPA’s “whole-of-agency” approach, that includes proposed actions across program offices, as well as the PFAS “lifecycle” (i.e., activities that occur prior to PFAS entering the environment, such as manufacturing).  EPA’s “Key Actions” illustrate this approach and are informed by one or more of the Roadmap’s three central directives: (1) Research; (2) Restrict; and (3) Remediate. A selection of the Roadmap’s Key Actions is summarized below.

 Office of Water

  • Establish a National Primary Drinking Water Regulation (NPDWR) for PFOA and PFOS – In March 2021, EPA published the Fourth Regulatory Determinations, which included a final determination to regulate PFOA and PFOS in drinking water. EPA expects to issue a proposed NPDWR for PFOA and PFOS in fall 2022. A final regulation is anticipated in fall 2023.
October 28, 2021

NextEra Announces Record Renewables, Pushing Major ‘Green’ Hydrogen Project

Pittsburgh, PA

Renewables Law Blog

(By Bruce Rudoy)

NextEra Energy Inc.’s CEO, Jim Robo, has pushed Congress to extend clean energy tax credits as the company announced record renewables contracts and a major hydrogen project yesterday. Robo said odds are “reasonably high” of an extension if a consensus can be reached on what would be in the reconciliation bill. There is wider support in Congress to expand clean energy tax credits compared to the proposed $150 billion Clean Electricity Performance Program or carbon pricing. Other proposals have included a broad clean energy tax overhaul that some large energy companies say they support. “If something happens there, we feel good about the fact that there will be a long-term extension of the credits,” Robo said, adding that he foresees tax policy support for hydrogen and energy storage investments. “It would be very constructive for us.” As one of the world’s largest renewable energy developers, NextEra has a lot to gain if the Biden administration is successful in financially encouraging wind, solar and other technologies to cut U.S. power sector emissions in half by 2030. President Biden has set the goal of decarbonizing the grid by 2035. We are increasingly thinking about ourselves as the company that’s going to lead not only the clean energy transformation of the electric grid but really the clean energy transformation of the U.S. economy and the decarbonization of the U.S. economy,” he said. The way Robo sees it, a low-emissions grid is critical to decarbonizing the transportation and industrial sectors. The falling costs of renewable resources combined with utility, corporate and state goals aimed at cutting emissions are driving large-scale projects nationwide. NextEra’s renewable energy unit signed a record 2,160 megawatts of solar, wind and storage projects during the third quarter, the company said during a conference call with Wall Street analysts.

October 23, 2021

Challenges and Opportunities for the Pennsylvania Gas Pipeline Industry

Pittsburgh Business Times

(by Daniel Bates featuring Keith Coyle and Blaine A. Lucas)

Even as opposition grows for energy pipelines, and government agencies toughen their regulation of the industry, pipelines remain the most safe, efficient and effective means to transport much-needed natural gas and other energy products from wells to end users to generate power, manufacture goods and heat homes.

So said Keith Coyle, a shareholder with law firm Babst Calland whose practice areas include energy law and pipeline and hazmat safety.

“We’re in a moment right now where we’re seeing some growing opposition to natural gas pipeline infrastructure,” Coyle said in making his case for the importance of supporting and protecting the nation’s energy pipeline infrastructure. “We’re seeing efforts to encourage governmental authorities to ban the construction of new pipelines or to delay the issuance of permits that are necessary for projects to move forward. We’re also seeing litigation that’s being used as a tool to try to block new pipelines or stop the operation of existing pipelines.”

Coyle and his colleague, Babst Calland shareholder Blaine Lucas, took their stand in favor of safe and efficient pipeline infrastructure as part of a recent discussion with the Pittsburgh Business Times on “The Challenges and Opportunities for the Pennsylvania Gas Pipeline Industry.”

Coyle and Lucas are quick to suggest that the current political climate, as well as the growing opposition from environmental activists and others, are problematic not just for the energy industry, but for people, the economy – and safety.

“One of the things that concerns me is if we remove pipelines from the equation, everything about the energy transportation network becomes less safe,” Coyle said.

October 22, 2021

Court Addresses Limitations on Approval of Planned Residential Developments

The Legal Intelligencer

(by Anna Jewart)

The requirements of a municipal zoning ordinance are strictly applied, and landowners must comply with the express use and dimensional limitations applicable in the zoning districts in which their properties are located. Landowners wishing to stray from the regulations of that district are usually forced to request relief in the form of a variance, the standards for the granting of which are quite rigorous. However, Article VII of the Pennsylvania Municipalities Planning Code, (MPC), 53 P.S. Sections 10701-10713, authorizes municipalities to enact, amend and repeal provisions within a zoning ordinance fixing standards and conditions for a “planned residential development” (PRD), a form of land development intended to offer an alternative to traditional, cookie-cutter zoning. The opinion of the Commonwealth Court in Gouwens v. Indiana Township Board of Supervisors (Gouwens II), offers an opportunity to revisit the foundations of PRD regulation and to explore the requirements for the tentative approval of a PRD. See Gouwens v. Indiana Township Board of Supervisors, Nos. 544, 992-994 C.D. 2020, 2021 (Pa. Cmwlth. July 8, 2021), publication ordered (Sept. 7, 2021)(Gouwens II), on appeal following remand of Gouwens v. Indiana Township Board of Supervisors, Pa. Cmwlth., No. 1377 C.D. 2018, (filed June 25, 2019), publication ordered (Sept. 7, 2021) (Gouwens I).

A PRD is a larger, integrated residential development that may not meet the use and dimensional standards normally applicable in the underlying zoning district. The idea behind PRD regulations is to create a method of approving large developments which overrides traditional zoning controls and permits the introduction of flexibility into their design.

October 21, 2021

EPA’s Proposed New Oil and Gas Methane Requirements: Where We Are and Where We Are Going

Energy Alert

(by Mike WinekGary Steinbauer, Gina Falaschi and Christina Puhnaty)

The U.S. Environmental Protection Agency (EPA) has pledged to issue, within days from now,  proposed new Clean Air Act (“CAA” or “Act”) regulations for methane emissions from the oil and gas sector.  EPA’s forthcoming proposal is expected to broaden the scope of its current methane requirements for new, modified, or reconstructed sources within the oil and gas sector.  In addition, for the first time, EPA will propose nationwide methane emission guidelines for existing sources within the sector that individual states will be responsible for implementing.  As the oil and gas sector awaits the new proposed methane requirements, this Alert summarizes the important and rare developments that have unfolded in the relatively brief history of EPA regulating methane emissions from the oil and gas sector.

Obama Administration Issues Initial Regulations of Methane Emissions from Oil and Gas Sector.  EPA issued its first set of oil and gas methane-specific emission regulations in 2016 during the Obama administration.  The 2016 regulations amended the then-current new source performance standards (NSPS) and promulgated new standards to directly regulate emissions of methane, as well as volatile organic compounds (VOC), from new, modified, and reconstructed equipment, processes, and activities across the entire oil and gas sector.  The 2016 amendments to the NSPS were codified at 40 C.F.R. Part 60, Subpart OOOOa (Subpart OOOOa).

Subpart OOOOa included specific limits on methane emissions for new, modified, and reconstructed sources within the production and processing segments of the oil and gas sector.  It also included VOC and methane standards for emission sources in the transmission and storage segments, which were previously unregulated.  

October 8, 2021

Groups petition for massive increases in oil & gas well bonds

The PIOGA Press

(by Kevin J. Garber, Sean M. McGovern and Jean M. Mosites)

On September 14, the Sierra Club, PennFuture, Clean Air Council, Earthworks and other groups submitted two parallel rulemaking petitions to Pennsylvania’s Department of Environmental Protection (DEP) asking the Environmental Quality Board (EQB) to require full-cost bonding for conventional and unconventional oil and gas wells, for both new and existing wells. The petitions do not address or consider the permit surcharges and other funding mechanisms for plugging wells, including the federal infrastructure bill that is expected to provide millions of dollars to plug abandoned wells.

Background

The Pennsylvania General Assembly addressed and increased bonding in 2012. Under Act 13, well owners/operators are required to file a bond for each well they operate or a blanket bond for multiple wells. Currently, the bond amount for conventional wells is $2,500 per well, with the option to post a $25,000 blanket bond for multiple wells. 72. P.S. §1606-E. For unconventional wells, the current bond amount required varies by the total well bore length and the number of wells and is limited under the statute to a maximum of $600,000 for more than 150 wells with a total well bore length of at least 6,000 feet. 58 Pa.C.S. §3225(a)(1)(ii). EQB has statutory authority to adjust these amounts every two years to reflect the projected costs to the Commonwealth of plugging the well.

Proposed changes to bond amounts

The petitioners contend that a lack of full-cost bonding has resulted in the abandonment of thousands of wells and that such wells pollute the environment and adversely affect the health of communities, and allege that the EQB has an obligation to increase bond amounts pursuant to the petition under the Environmental Rights Amendment.

October 7, 2021

Now might be time to appeal your commercial real estate assessment

Smart Business

(by Sue Ostrowski featuring Peter Schnore)

COVID-19 has had a dramatic impact across the board, creating economic uncertainty and having an adverse effect on commercial property values that continues to this day. In Allegheny County, effects are perhaps most pronounced in the office market, and in particular in Class B downtown Pittsburgh office space, but no commercial property type with indoor space has been immune, says Peter Schnore, shareholder at Babst Calland.

“Tenants’ initial response to COVID was a wait-and-see holding pattern with respect to whether they were going to renew leases or move to new space,” says Schnore. “As a result, many landlords have had to dig deep to keep and attract tenants by offering unprecedented periods of free rent or tenant improvement allowances, creating an adverse impact on net operating income. The unknowns surrounding COVID are still affecting nearly all commercial property types, not just office properties.”

Smart Business spoke with Schnore about how COVID is impacting the value of commercial real estate and why it may be a good idea to review your recent tax assessment.

What is the current situation for owners of commercial real estate?

Future uncertainty while we remain in the throes of COVID is driving up risk of commercial property investment, driving down commercial property values. Landlord concessions — in some cases multiple years of free rent or triple-digit tenant improvement allowances — are increasing operating expenses and reducing short-term income, resulting in an immediate and substantial adverse impact on value. As a result, many properties that house office, retail, restaurants, hospitality and others now have assessments that are higher than the current value of the real estate merits.

October 1, 2021

Pittsburgh company dedicated to promoting entrepreneurship receives $250k in federal grant money

TRIBLive

JULIA FELTON | Thursday, Sept. 30

A Pittsburgh-based company dedicated to promoting entrepreneurship will receive $250,000 in funding from the U.S. Department of Commerce.

The grant is part of a $36.5 million grant pool that benefited 50 entrepreneurship-focused organizations, nonprofits, institutions of higher learning and state government agencies nationwide. The grants were announced Thursday by Assistant Secretary of Commerce for Economic Development Alejandra Y. Castillo.

The grants are part of the “Build to Scale” program, which aims to accelerate technology entrepreneurship by increasing access to business support and startup capital. The program is administered by the U.S. Economic Development Administration (EDA).

“The ‘Build to Scale’ program strengthens entrepreneurial ecosystems across the country that are essential in the Biden Administration’s efforts to build back better,” Secretary of Commerce Gina M. Raimondo said. “This work is critical in developing the innovation and entrepreneurship our country needs to build back better and increase American competitiveness on the global stage.”

Founded in 2002, Idea Foundry is a global investor with over 250 companies and projects in their portfolio.

The company says it has generated more than $1 billion in economic impact and created more than 1,000 jobs in the region.

It works to strengthen entrepreneurship in Pittsburgh through a model that emphasizes hands-on development and a variety of investment vehicles that enable entrepreneurs to develop and scale their ideas into growing enterprises.

It not only helps to match entrepreneurs with capital, but also to help keep them “alive, growing and in Pittsburgh,” said Michael Matesic, Idea Foundry’s president and CEO.

The company was awarded the 2021 Venture Challenge Grant. It’s intended to “increase access to capital in communities where risk capital is in short supply by providing operational support for early-stage investment funds, angel capital networks or investor training programs that focus on both traditional and hybrid equity-based models,” the Department of Commerce wrote in a press release.

October 1, 2021

New court ruling relates to retroactivity of flat rate royalty law

GO-WV News

(by Katrina Bowers )

In Williams v. EQT Corp., No. 43-2020-C-26 (Ritchie Co. Cir. Ct. W. Va. Aug. 26, 2021), the Honorable Michael D. Lorensen, sitting by appointment in the Circuit Court of Ritchie County, West Virginia (“Court”), entered an Order finding that the 2018 amendments to W. Va. Code § 22-6-8(e) (“Flat Rate Statute”) did not apply retroactively to permits for oil or gas wells (“permits”) issued before the effective date of the amendments to the Flat Rate Statute.

The plaintiffs, successors in interest to a 1913 lease providing for a flat rate payment of four hundred dollars per year for each and every natural gas well drilled on the leasehold estate (“Lease”), challenged deductions by an operator for severance tax and certain post-production expenses from their royalties.

The West Virginia Legislature addressed the issue of flat-rate leases in 1982, when it enacted the Flat Rate Statute prohibiting the issuance of permits where the right to produce was based upon a lease providing for a flat-rate royalty, unless the permit applicant submitted an affidavit certifying that it would pay the lessor no less than one-eighth of the total amount paid or received by or allowed “at the wellhead” for the oil and gas extracted, produced, or marketed (“permit procedure for flat-rate leases”). Id. at *5-6.

In 2017, the Supreme Court of Appeals of West Virginia addressed the payment of royalties pursuant to flat-rate leases and held that royalty payments subject to the Flat-Rate Statute “may be subject to pro-rata deduction or allocation of all reasonable post-production expenses actually incurred by the lessee.” Id. at *6 (quoting Syl.

September 20, 2021

Groups Petition Environmental Quality Board for Full-Cost Bonding for Oil & Gas Well Plugging

Energy Alert

(by Kevin GarberSean McGovern and Jean Mosites)

On September 14, 2021, the Sierra Club, PennFuture, Clean Air Council, Earthworks and other groups (Petitioners) submitted two parallel rulemaking petitions to Pennsylvania’s Department of Environmental Protection (DEP) asking the Environmental Quality Board (EQB) to require full-cost bonding for conventional and unconventional oil and gas wells, for both new and existing wells. The petitions do not address or consider the permit surcharges and other funding mechanisms for plugging wells, including the federal infrastructure bill that is expected to provide millions of dollars to plug abandoned wells.

Background

The Pennsylvania General Assembly addressed and increased bonding in 2012. Under Act 13, well owners/operators are required to file a bond for each well they operate or a blanket bond for multiple wells. Currently, the bond amount for conventional wells is $2,500 per well, with the option to post a $25,000 blanket bond for multiple wells. 72. P.S. §1606-E. For unconventional wells, the current bond amount required varies by the total well bore length and the number of wells, and is limited under the statute to a maximum of $600,000 for more than 150 wells with a total well bore length of at least 6,000 feet. 58 Pa.C.S. §3225(a)(1)(ii). EQB has statutory authority to adjust these amounts every two years to reflect the projected costs to the Commonwealth of plugging the well.

Proposed Changes to Bond Amounts

The Petitioners contend that a lack of full-cost bonding has resulted in the abandonment of thousands of wells and that such wells pollute the environment and adversely affect the health of communities, and allege that the EQB has an obligation to increase bond amounts pursuant to the petition under the Environmental Rights Amendment.

September 16, 2021

Unemployment Compensation Roundup: Review of Recent Legislation, Cases, and Concerns

The Legal Intelligencer

(by Alex Farone)

The COVID-19 pandemic has broadly affected nearly every state’s unemployment compensation (UC) system in one way or another, and Pennsylvania is no exception. From extended appeal deadlines to an uptick in UC fraud claims, this article sets forth four of the most recent changes or proposed changes to Pennsylvania’s UC system that have arisen due to COVID-19.

  1. Appeal Deadlines: Extension and Refresher

The process for employees seeking UC benefits can involve several steps and multiple appeals. The first step involves the recently separated employee filing an application for benefits. Applications are processed by one of several UC Service Centers across the Commonwealth. These Service Centers are tasked with making an initial determination on claimants’ applications. The Service Centers’ determinations may be appealed by either the claimant or their former employer to a UC Referee, who will conduct an evidentiary hearing on the merits of the application. The decision of the UC Referee may then be appealed by either party to the UC Board of Review (Board).

Until recently, applicants and employers had just 15 days to appeal initial determinations and referees’ decisions. On June 30, 2021, Governor Tom Wolf signed Act 30, formerly H.B. 178, into law, extending the time period allowed for appeals of UC Service Center determinations and UC Referee decisions from 15 days to 21 days.

Act 30 does not impact the deadlines to file appeals with either the Pennsylvania Commonwealth Court or the Supreme Court of Pennsylvania. An appeal to the Pennsylvania Commonwealth Court from the Board is an appeal as of right, but any further appeal to the Pennsylvania Supreme Court must be specifically permitted by that Court in response to an appellant’s petition for allowance of appeal.

September 16, 2021

DOE Releases Solar Futures Study Outlining a Plan to Reach 40% Solar Electricity by 2035

Washington, DC

Renewables Law Blog 

(By Ashley Krick)

On September 8, 2021, the Department of Energy (DOE) released its Solar Futures Study providing a blueprint for the role of solar energy in decarbonizing the nation’s power sector.  The 310-page Study outlines a future in which solar provides 40% of the nation’s electricity supply by 2035 through cost reductions, technological improvement, rapid deployment, and supportive policies.  And, with the electrification of buildings and the transportation sector, solar could also power 30% of all building end uses and 14% of transportation end uses by 2050.

The Study identifies several policy initiatives needed to support the deployment of solar at this scale, including decarbonization targets, R&D investments and cost reductions, changes to wholesale electricity market regulation, and transmission development, to name a few. In order to meet the 40% by 2035 goal, the Study estimates that the U.S. must install an average of 30 GW of solar capacity per year between now and 2025 and 60 GW per year from 2025-2030, with a total of 1,000 GW of solar deployed by 2035. If the solar industry sees this level of growth, the Study estimates that the industry could employ up to 1.5 million people by 2035. The Study also highlights the important role that battery storage and demand-side management will play given that solar power varies based on daily and seasonal patterns.

With solar power currently providing approximately 3% of the nation’s electricity supply, the DOE’s 40% goal will be contingent on many factors supporting the industry in the coming years, including cost reductions, supportive policies, and widespread deployment.

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September 15, 2021

EPA and Corps revert back to pre-2015 definition of ‘waters of the United States’

The PIOGA Press

(by Lisa Bruderly)

The U.S. Environmental Protection Agency (EPA) and U.S. Army Corps of Engineers announced, on September 3 that they had halted implementation of the current definition of “waters of the United States” (WOTUS) effective immediately and reverted back to the pre-2015 definition until further notice. The switch follows an August 30 order from the U.S. District Court for the District of Arizona, which remanded and vacated the definition of WOTUS promulgated by the Trump administration in 2020 (commonly referred to as the Navigable Waters Protection Rule (NWPR)) in the case of Pascua Yaqui Tribe v. U.S. Environmental Protection Agency. While there was speculation that the court’s vacatur could be narrowly interpreted to apply only to states where the plaintiffs in the case were located (i.e., Arizona, Minnesota, Washington and Wisconsin), EPA and the Corps are applying the change in WOTUS definition nationwide.

Importance of the definition of WOTUS

The definition of WOTUS identifies which waters are federally-regulated under the Clean Water Act (CWA), and therefore determines when a federal permit is required for projects (e.g., pipelines, access roads, well pads) that involve dredging or filling of a waterbody (i.e., a Section 404 permit). The WOTUS definition also affects federal spill reporting and spill prevention planning.

With regard to Section 404 permitting, the more expansive the definition of WOTUS, the more waters that are federally-regulated. The extent of WOTUS impacts resulting from a project determines whether an individual or a general Section 404 permit is required, with the process for obtaining an individual permit typically resulting in more Corps involvement, delay and expense.

Significance of the change in WOTUS definition

When the Trump administration promulgated the NWPR in 2020, environmental groups criticized and challenged the new WOTUS definition, claiming it was too narrow and did not federally regulate enough types of waters.

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