The UCLA Journal of Environmental Law and Policy produces a high quality biannual journal on cutting-edge environmental legal and policy matters. JELP is entirely run and produced by students at UCLA School of Law. Articles in JELP are written by leading scholars throughout the country and often the world, and by students focusing on environmental law at UCLA.
Volume 40, Issue 1, 2022
Table of Contents
The time has never been better for the Securities and Exchange Commision (SEC) to regulate climate change disclosures; however, the agency has a poor track record in mandating climate and other specialized disclosures from public corporations. Its 2010 guidance on climate-related disclosures was sparsely enforced. Its 2012 conflict materials rule was partially invalidated by the courts, and in 2019 and 2020, the agency failed to include climate disclosures when modernizing rules and guidelines on corporate disclosures. These past failures were due to agency intertia, which was facilitated by a combination of a lack of political feasibility, strong business resistance to specialized disclosures (despite investor enthusiasm), and rising judicial hostility to the SEC. These past failures should not dictate agency approaches to climate disclosures moving forward. Regulating climate change is high on the agenda of the Biden Administration. Investors are demanding that public corporations be more transparent about climate-related risks. The SEC is starting to act, issuing a call for public input on climate-related disclosures and enhancing its focus on climate-related disclosure in public company filings.
These political, investor, and agency shifts are primarily due to the rising awareness of the potential systemic nature of the risks of climate change to financial systems, both in the U.S. and internationally. This article assesses the policy feasibility of climate-related disclosure rules. It argues that past SEC failures can and should inform SEC rulemaking on climate change disclosures moving forward. Regulating climate disclosures benefits not only investors and capital markets, but also companies, due to the systemic nature of climate risk. This article argues that robust cost-benefit analysts and industry-specific, flexible but firm regulatory approaches will improve policy feasibility.
The Fossil Fuel Phase-Out's Multi-Million Dollar Problem: An Environmental Justice Analysis Of Idle Oil Well Management in California
Throughout the state of California, oil operators will continue to abandon thousands of their oil wells within the coming years. With the growing threats of climate change, local, state and federal policymakers are looking away from fossil fuels and towards supporting renewable energy generation. In April 2021, California Governor Gavin Newson directed the California Air Resources Board (CARB) to begin evaluating paths to phasing out fossil fuel extraction in the state by 2045. The economic impact of the COVID-19 pandemic has also increased the risk of operators filing for bankruptcy and thus orphaning their wells. When an oil well stops operating, becoming idle, there are still many environmental and health related hazards remaining at the site. Uncapped idle wells are known to emit toxic and flammable gases, such as methane, a potent greenhouse gas. In addition, wells that are left unplugged can contaminate surrounding soil and water supplies.
In California, the process of plugging and decommissioning a well is the operator’s responsibility. However, operators have little incentive to plug and decommission their wells because maintaining their idle wells is generally cheaper. Properly plugging and decommissioning an onshore well can cost between $40,000 and $152,000. By maintaining their idle wells instead of decommissioning and plugging their wells, operators also preserve the option value of their wells in case oil prices increase. Additionally, if an oil company becomes insolvent or deserts its wells, making them orphaned wells, that cost of decommissioning and plugging the well is borne by the State. The State currently lacks sufficient funds to plug and abandon all orphaned wells. Due to that lack of funding, many orphan wells are left unplugged, harming the surrounding communities and contributing to climate change.
Last year, the California Geologic Energy Management Division (CalGEM) tightened its regulations around idle well management “to create far more stringent testing requirements that better protect public safety and the environment from the potential threats posed by idle wells.” This comment will analyze CalGEM’s updated regulations and current laws for idle well management. Specifically, the comment will use an environmental justice theoretical framework to assess whether the updated regulations meet CalGEM’s goal of “better protect[ing] public safety . . . from the potential threats posed by idle wells,” particularly for low-income communities and communities of color in California. The comment will go on to suggest potential areas where CalGEM can strengthen its regulations to better protect communities near idle wells, particularly by: (1) increasing idle well fees, (2) increasing the indemnity bond amount, (3) adding cumulative impacts to CCR section 1772.4 considerations, and (4) allowing for public comment on critical prioritization decisions. While there are certain strengths to the updated regulations and current laws regarding idle well management, they still fall short of appropriately protecting the health and safety of communities throughout California.
Environmental movements have been hindered in utilizing disparate impact as an effective legal mechanism for change. Since the 2001 Sandoval ruling limited the private right of action for Title VI disparate impact claims, environmental justice advocates have adopted the disparate impact framework as a persuasive tool to analyze, investigate, and challenge inequitable development. Concurrently, ecosystem services have blossomed as a growing field. The ecosystem services framework asserts that ecosystems providee conomic and health benefits for communities. However, this framework faces challenges with value recognition and visibility, lack of implementation within existing institutional frameworks, and inequitable access. This article explicitly combines the disparate impact and ecosystem services frameworks together to strengthen each other. Specifically, this article argues that incorporating ecosystem services within disparate impact analyses can provide new persuasive data and evidence for environmental justice movements. Additionally, environmental justice advocates utilizing ecosystem services frameworks can increase the field’s visibility, data, and provide more information regarding inequitable ecosystem access.
Come Hell or No Water: The Story of Sandbranch and the Unincorporated Community Fight for Public Services
Sandbranch is the only unincorporated community left in Dallas County, and the residents of this majority-Black, impoverished community have had their cries for basic necessities—such as clean, running water—largely ignored. With the County and the City of Dallas not remedying the problem so far, there is a question as to who is responsible for providing water and other public services to the community’s eighty residents. As it currently stands, Texas law simply permits local governments to offer assistance to unincorporated communities but does not mandate that affirmative measures be taken to ensure that these communities are provided for. What is the scope of the existing local government laws when it comes to getting public services to unincorporated areas, and what will it take for Sandbranch to finally get the resources it has been fighting to receive for decades?