Winston’s Environmental Law Update

On October 7, 2023, California Governor Gavin Newsom signed SB 261, the Climate-Related Financial Risk Act, and SB 253, the Climate Corporate Data Accountability Act, into law. These first-in-the-nation greenhouse gas (GHG) emissions disclosure and climate-related financial risk reporting laws apply to large companies “doing business” in California.

The Environmental Protection Agency (EPA) announced that climate change and PFAS will be a focus of investigation and enforcement in coming years. The oil and gas, chemical, and waste-related industries should take note. EPA’s national enforcement and compliance initiatives (NECIs) for fiscal years 2024-2027,^[1]announced on August 17, 2023, include climate change, PFAS, and coal ash contamination among six priority areas for enforcement. EPA will also continue to prioritize reducing air toxics in overburdened communities, increasing compliance with drinking water standards, and chemical accident risk reduction.

As of February 13, 2023, ASTM 1527-21 will meet the AAI requirement, and thus will become the relevant standard for conducting Phase Is. Phase Is conducted using the 2013 Standard will no longer be compliant with the AAI requirement after December 15, 2023. Users of Phase Is should update internal guidance or scopes of work with environmental professionals to confirm (1) reports are completed to the new standard beginning in February 2023 and (2) whether emerging contaminations, including PFAS, should be included in the property evaluation as a “non-scope consideration.”

The Environmental Protection Agency (EPA) has announced its proposed National Enforcement and Compliance Initiatives (NECIs) for fiscal years 2024–2027. EPA is proposing to add two new areas of enforcement focus: mitigating climate change and addressing per- and polyfluoroalkyl substances (PFAS) contamination. Those operating in the oil and gas industry, and those involved with refrigerants, should take note. Interested parties have until March 13, 2023 to submit comments to EPA on the proposed changes.

On June 15, 2022, the U.S. Environmental Protection Agency (EPA) announced new drinking water Health Advisories Levels (HALs) for certain per- and polyfluoroalkyl substances (PFAS) as part of its PFAS Strategic Roadmap.

On August 26, 2022, the Environmental Protection Agency (EPA) announced its proposal to designate two of the most widely known per- and polyfluoroalkyl substances (PFAS)—PFOA and PFOS[i]—as hazardous substances under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA, also known as the Superfund law). Listing PFOA and PFOS (along with their salts and structural isomers) as hazardous substances under CERCLA is one of the most significant actions identified in EPA’s October 2021 PFAS Strategic Roadmap.[ii]

On July 20, 2022, the FDA opened a docket to seek data regarding the presence of per- and polyfluoroalkyl substances (PFAS) in food containers that may migrate into consumers’ food. Electronic or written comments and scientific data and information must be submitted by October 18, 2022.

On May 2, 2022, the U.S. Environmental Protection Agency withdrew its direct final rule that would have amended 40 C.F.R. Part 312 to recognize ASTM’s updated E1527-21 standard as satisfactory to fulfill the “all appropriate inquiries” requirement of certain defenses to liability under the Comprehensive Environmental Response, Compensation, and Liability Act.

ASTM International has submitted the new standard (E1572-21) to the United States Environmental Protection Agency (EPA) for the EPA to review and confirm that the updated standard can be used to meet the statutory defenses noted above. The EPA is expected to take up to one year to complete its review.

On October 18, 2021, EPA announced its PFAS Strategic Roadmap: EPA’s Commitments to Action 2021 – 2024. The action plan expands on its goals published in EPA’s 2019 PFAS Action Plan, focusing on three central directives – investing in research, pursuing a comprehensive approach to prevent PFAS from entering air, land, and water at adverse levels, and to broaden and accelerate the cleanup of existing PFAS contamination.

For close to two years, a task force of due diligence consultants, lenders, attorneys, and other professionals have been working to revise the American Society for Testing and Materials (ASTM) International Phase I Environmental Site Assessment (Phase I) Standard E1527-13 to account for per- and polyfluoroalkyl substances (PFAS). The ASTM Standard is used by purchasers of real property to meet the “all appropriate inquiries” requirement of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) to establish the innocent landowner, contiguous property owner, or bona fide prospective purchaser defenses to CERCLA liability. These defenses are used to limit the buyer’s liability for historic contamination that pre-dates their ownership. Phase Is are also often used in corporate transactions as a part of environmental due diligence, including in transactions where these CERCLA defenses would not apply.

On June 28, 2021, EPA proposed a new reporting and recordkeeping rule for per- and polyfluoroalkyl substances (PFAS) pursuant to Section 8(a)(7) of the Toxic Substances Control Act (TSCA), as amended by the National Defense Authorization Act.

On April 13, 2021 Representatives Debbie Dingell and Fred Upton, Democrats from Michigan, introduced the PFAS Action Act of 2021 (the Act) to Congress.

On November 30, 2020, the EPA issued a memorandum detailing an interim National Pollutant Discharge Elimination System (NPDES) permitting strategy for addressing per- and polyfluoroalkyl substances (PFAS) in wastewater and stormwater permits. The memorandum outlines the most recent recommendations from the PFAS NPDES Regional Coordinators Committee.

While U.S. EPA recently announced in a March 26, 2020 memo that it will temporarily suspend enforcement of certain routine monitoring and reporting violations due to COVID-19, EPA’s memo does not amount to a “free pass” for businesses to voluntarily discontinue compliance monitoring and reporting. 

Last week, the Environmental Working Group, an environmental watchdog group, published a list of over 2,500 facilities that it claims are “likely” releasing per- and polyfluoroalkyl substances into the environment. A review of the information used to populate the list, however, reveals that the hyperbolic headline is not based on verifiable data.