Real Property & Environmental Law Alert : New Jersey, New York, Pennsylvania & Delaware Lawyers & Attorneys for Real Estate Development & Environmental Law

On December 21, 2011, the United State Environmental Protection Agency (EPA) announced that it had issued the first ever national standards for mercury emissions and other air pollutants from power plants. The regulations were mandated by the 1990 Clean Air Act Amendments. EPA estimates that the new standards will make a major contribution to public health by preventing 11,000 premature deaths and 4,700 heart attacks annually, as well as 130,000 cases of childhood asthma symptoms and about 6,300 cases of acute bronchitis among children each year.

EPA Administrator Lisa P. Jackson stated, "The Mercury and Air Toxics Standards will protect millions of families and children from harmful and costly air pollution and provide the American people with health benefits that far outweigh the costs of compliance." According to EPA, the standards rely on widely available pollution controls that are already in use at more than half of the nation’s coal-fired power plants.

Sources will have three years to achieve compliance, with a fourth year available from state permitting authorities for technology installation. In developing the final rules, EPA consulted with State, local, and tribal officials in and also worked with industry groups, unions and other stakeholders. It reviewed over 900,000 comments. Critics of the regulations assert that they will result in job loss because older coal fired plants may be required to close. EPA counters that society as a whole will benefit because prevention of asthma, heart attacks, bronchitis and other illnesses attributable to air toxics will save $37 billion to $90 billion in health care costs each year by 2016.

Susanne Peticolas is a Director in the Gibbons Real Property & Environmental Department.

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A draft report from United States Environmental Protection Agency’s (EPA) Office of Research and Development has tentatively pointed a finger at hydraulic fracturing (“fracking”) as a cause of groundwater contamination detected in a number of wells near the town of Pavillion, Wyoming. The report, which has not yet undergone outside peer review, is likely to set off alarm bells among both proponents and opponents of fracking, including those in eastern states like New York, New Jersey, and Pennsylvania.

Fracking involves the pumping of pressurized water, sand, and chemicals into underground rock formation (such as the Marcellus Shale formation in Pennsylvania and New York) that contains natural gas. The high-pressure fluid creates cracks, or fractures, in the rock, allowing the trapped gas to escape, flow into the well and up to the surface. Eastern states have adopted a variety of policies toward fracking, ranging from Pennsylvania’s enthusiastic promotion to New York’s temporary moratorium and ongoing effort to promulgate protective regulations to New Jersey’s attempted legislative prohibition that was vetoed in favor of a temporary ban.

Whether fracking may contaminate groundwater is a critical question facing policy makers across the country. The EPA study, conducted in response to complaints from residents about objectionable taste and odor problems in water drawn from the drinking water wells after fracking in nearby gas production wells, concludes, based upon both data and complex scientific reasoning, that fracking has caused impacts to ground water in the Pavillion area. EPA also noted certain limitations of the study: its purpose was “to determine the presence, not the extent, of ground water contamination in the formation,” and the results are specific to the Pavillion area, where fracking occurs in and below a drinking water aquifer and near drinking water wells, unlike production practices in many other parts of the country.

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The all electric Nissan Leaf is now available in seven new states, bringing the total to 30, including New Jersey, where it is sold. The additional states are Delaware, Indiana, Louisiana, Nevada, Ohio, Pennsylvania and Rhode Island. This is good news for Delaware, Pennsylvania and Rhode Island, which are members of the Transportation and Climate Initiative planning for an Electric Vehicle (EV) Network across the Northeast.

The proposed EV Network is intended to enable EV drivers to be able to use their vehicles easily throughout the Northeast from northern New England to Washington, D.C. In addition, it hopes to attract private investment with consistent standards and regulations across the region. The project will develop a plan and guidance documents for the development of a network of charging stations.

On September 22, 2011, the Transportation and Climate Initiative, which includes New Jersey as a member, was awarded a federal grant of nearly $1 million to start planning the EV Network. According to Commissioner Martin, "Improving air quality in New Jersey is a top priority of the Christie Administration. But in addition to helping us reduce auto emissions and improving the health of our residents, this new network will provide an economic boost to the State through the creation of new green jobs in research and production of electric cars and electric vehicle infrastructure."

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An 1881 deed and an 1882 Supreme Court decision formed the background for a very modern controversy recently addressed by the Pennsylvania Superior Court. The decision, Butler v. Estate of Powers, casts a shadow over ownership rights in natural gas contained in the Marcellus Shale formation, and has left many companies in the “fracking” industry uncertain about what they own.

The deed in question conveyed a 244-acre parcel to the appellees’ alleged predecessors in title, but reserved “one half the minerals and Petroleum Oils” to the grantor. The appellees claimed to own the surface and 100% of the minerals and petroleum -- including, specifically, natural gas contained in the Marcellus Shale formation under the parcel -- based on adverse possession. The appellants, heirs to the estate of the grantor, claimed that the reservation in the deed gave them, and not the appellees, half of the shale gas.

The issue: what legal rule should the court apply? Most observers thought that the Pennsylvania Supreme Court’s 1882 decision in Dunham v. Kirkpatrick, as extended by its 1960 decision in Highland v. Commonwealth controlled. Those cases held that a conveyance of “mineral rights” is presumed not to include the right to extract oil and gas. The Supreme Court later carved out an exception to Dunham in U.S. Steel Corp. v. Hoge, which held that coalbed methane belongs to the owner of the coal. The Hoge rule was thought to apply only to coal and the gas contained within it.

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The Gibbons Real Property & Environmental Department will once again exhibit at the International Council of Shopping Centers (ICSC) National Conference & Deal Making Idea Exchange at the Hilton New York on December 5-6.

The Department's booth will be in the same location as prior years, #490 in Americas Hall II. Stop by and meet with some of the Department's seven attorneys who will be attending. Show hours are Monday, December 5, from 9:00 am to 5:30 pm, and Tuesday, December 6, from 8:30 am to 4:00 pm.

We look forward to seeing you there!

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