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Oregon moves to restore, reinstate climate change regulations derailed by natural gas lawsuit

The landmark Climate Protection Program is effectively dead for the next year while state regulators redo the rulemaking and approval process

By ALEX BAUMHARDT, Oregon Capital Chronicle
Published: January 29, 2024, 4:06pm

State environmental regulators will redo the year-long process of rulemaking and adopting landmark climate change regulations that were enacted three years ago.

The decision to do it all over again was announced Monday by the Oregon Department of Environmental Quality, a month after the state’s second highest court ruled in favor of natural gas utilities seeking to invalidate the Climate Protection Program.

The Climate Protection Program was approved in 2021 by the state’s rulemaking Environmental Quality Commission after more than a year of meetings, presentations from the environmental quality department and public comment. It requires fossil fuel companies operating in the state to gradually reduce their emissions, achieving a 50% reduction by 2035 and 90% by 2050. At least 26% of the reductions will have to come from natural gas utilities.

Natural gas is almost entirely methane gas, among the most potent climate-warming greenhouse gases that trap heat in the atmosphere. One-third of global warming is due to human-caused emissions of methane, according to the U.S. Environmental Protection Agency.

But in December, the Oregon Court of Appeals judges agreed with natural gas utilities that the state did not fully comply with disclosure requirements when it voted to create emissions rules that exceed federal rules that affect entities with air pollution permits under the federal Clean Air Act. The judges ruled the program invalid on that technicality.

Rather than appealing the decision to the Oregon Supreme Court, which would likely not hear the case until mid-2025, state environmental regulators will start again. For the time being, the Climate Protection Program is not in effect.

“DEQ strongly disagrees with the court’s decision, but we accept it,” Leah Feldon, the agency’s director, said in a statement. “Instead of pursuing the lengthy and uncertain appeals process, we’re taking the shortest path to reinstating the program – going back through the rulemaking process.”

Regulators are already developing a schedule and advisory committees to begin the rulemaking process, according to Lauren Wirtis, a communications manager for the environmental quality department. Wirtis said in an email that no new investments will be needed to redo the process, and the same staff who were involved in the creation of the 2021 Climate Protection Program will be involved again. That process typically takes about 12 months, and it will include a public comment period, meetings and presentations to the environmental commission from the environmental department before final adoption of rules by the commission.

Wirtis said it is possible some parts of the previous program could change in the process.

“The rules could change during the rulemaking process. This includes having new elements or shifting timelines,” she said.

The lawsuit

Lawyers for the state’s natural gas utilities – NW Natural, Avista Corporation and Cascade Natural Gas Corporation – challenged the Environmental Quality Commission and the Department of Environmental Quality over the 2021 rules.

They said that in the process of imposing state regulations to cap and reduce emissions, the commission failed to submit required disclosures to them and to other entities that hold federal industrial air pollution permits. Those disclosures include a written explanation about why the state is adopting limits that exceed federal rules and an explanation of alternatives to the rules that were considered and why those alternatives were not adopted.

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David Roy, director of communications for NW Natural, said in an email that the company will also participate in the repeat rulemaking process. He did not respond to a question about whether the company would operate as if the Climate Protection Program were in place during that process.

“We believe in effective climate policy and remain committed to moving toward a low-carbon energy future while safely, reliably and affordably serving our customers,” he said.

In a statement, leaders from seven nonprofit environmental groups, including Oregon Business for Climate, Oregon Environmental Council and Climate Solutions, among others, supported the state’s decision to go back to rulemaking.

“We applaud the state’s decisive action to reinstate Oregon’s Climate Protection Program without further delay. Oregonians have long demanded that fossil fuel companies take responsibility for the devastating harm they cause to our lives, our families, and our communities,” they said.