Spence writes: “States are better equipped than the federal government to regulate most of those risks. Why? Because both the benefits and the costs of fracking fall mostly on states and local communities. States gain the most from added jobs and tax revenue; they face the truck traffic, noise, pollution risks and rapid industrial growth. Consequently, states are in the best position to figure out how best to balance fracking’s costs and benefits.”
Jeff Civins, a parter in the Austin office of Haynes and Boone and an Energy Center advisory board member, expressed skepticism about proposed federal hydraulic fracturing regulation in an April 12 SNL Financial article.
“You shouldn’t regulate unless there’s a need,” Civins cautioned. “Before we spend a lot of time legislating, we ought to take a look and see if there’s a problem that requires legislation. … That gets to the whole [problem] with fracking, where people are concerned about it without looking at what actually is involved.”
Civins is an adjunct professor at the University of Texas School of Law, where he has taught an environmental litigation course since 1992, and a co-editor of the Thomson West Texas Practice 2-volume treatise on Texas Environmental Law.
The University of Texas Regulatory Oversight Group (UTROG) submitted comments today on disclosure provisions of hydraulic fracturing regulations proposed by the Alaska Oil and Gas Conservation Commission (AOGCC)
UTROG consists of students who are participating in a law school class in environmental regulation and are overseen by two professors. In preparing the comments, the students reviewed regulations adopted in other states and met with UT Law alumni with experience working on fracking matters.
The proposed Alaska rule has attracted attention because, unlike existing fracking regulations, it does not include trade secret protections.
“In Alaska, geologists have identified 42 trillion feet of cubic natural gas in North Slope shale formations that could be produced using current technology,” the comments explain. “While these reserves present Alaska with tremendous opportunity, the AOGCC should be mindful of the experiences that Texas and other states in the Lower 48 have encountered in developing their shale resources.”
To that end, the comments recommend the AOGCC consider seriously the public interest in disclosure and the downsides associated with trade secret protections. The comments proose a set of minimal requirements that should accompany any trade secret regime the AOGCC decides to incorporate into the final version of the rules.
Energy Center executive director Melinda Taylor and research fellow Jeremy Brown have publisehd an opinion piece in the Houston Chronicle encouraging the Texas legislature to amend a water infrastructure bill tHB 4 Houston Chronicle Op-Edo connect financing to conservation.
The bill - H.B. 4 - was approved in the Texas House last week by an impressive margin of 146-2 and would establish a fund intended to help the state address its long-term water needs. While the bill does acknowledge the importance of conservation, it requires relatively limited funding for conservation projects.
The premiere moot court focused on international law issues – the William C. Vis International Commercial Arbitration Moot – has begun its annual
in Vienna, with the team from the University of Texas School of Law considered to be a particularly strong contender.
The purpose of the moot is to foster the study of international commercial law and arbitration for resolution of international business disputes through its application to a concrete problem of a client and to train law leaders of tomorrow in methods of alternative dispute resolution. This year, the problem centers on a multi-party dispute stemming from a contract for more than $2 million worth of polo shirts produced by a subcontractor that was found to use child labor.
“This is a problem that stretches across multiple national jurisdictions and raises difficult substantive and procedural issues,” said Karl Bayer ’76, an Austin-based arbitrator who is coaching the UT team along with Energy Center Executive Director Melinda Taylor ’86 and Renee Kolar ’12, herself a recent Vis participant. “Our students have analyzed it thoroughly and have developed some powerful arguments.”
The UT team, which is being sponsored by the Energy Centre, has four members – Rebecca Bennie, Jonathan Schultz, Zachary Chittick, Brett Rosenthal. For months, the students have devoted their Wednesday nights and more than a few weekends to drafting their brief and sharpening their oral arguments.
In fact, as the competition approached, the students rehearsed before prominent international arbitration practitioners like Jim Loftis ’90, the head of the International Dispute Resolution practice at Vinson & Elkins and the chair of the Energy Center’s advisory board.
“UT fields a good team every year, but this year our team is truly exceptional,” Taylor said. “We have high expectations for them.”
Over the last two years, the University of Texas School of Law has been offering an innovative course that requires students to write petitions, comments, and other regulatory products in lieu of seminar papers. The students (called collectively the University of Texas Regulatory Oversight Group, or UTROG) focus on particularly complicated environmental problems for which there is often a lack of engagement by at least one main affected group, whether it be the general public, farmers, or small businesses.
Since there are no clients, identifying both the problem and possible solutions for these applied projects are done primarily by the students in ways reminiscent of the open-ended public interest work of the 1970’s. Over the last two years, the Group has tackled issues ranging from worker protection standards, to trade secret protections, to fracing, to drought prevention.
On March 20, 2013, UTROG launched its first work product – a petition, directed at the Occupational Safety and Health Administration (OSHA). The petition requests OSHA to provide more public information on the high performing facilities programs. Facilities that qualify to be part of this particular OSHA program enjoy reduced enforcement and a reputational boost for being classified as particularly safe, but the facilities’ application and record of exemplary compliance are not publicly available. What is worse, after qualifying, several of these “best performers” appear to have maintained unsafe workplaces that caused the death of workers. The petition can be found here.
Stay tuned on the fate of the OSHA petition as well as other work products that will be emerging soon from the course. It is our hope that UTROG may be the beginning of a larger network of courses at other law schools. If you are interested in learning more about UTROG, please contact Wendy Wagner or Jeremy Brown.
Let market-based incentives play a role in solving water shortages
By Melinda E. Taylor and Jeremy M. Brown
February 2, 2013
The Texas Supreme Court once observed that “(the) story of water law in Texas is also the story of its droughts.” It should not be surprising, then, that with the state in the midst of a difficult drought and long-term supply shortages looming, a new chapter is being added to the story of Texas water law.
The Legislature is considering bills to finance water infrastructure. The Supreme Court has agreed to hear an interstate dispute over rights to water in the Red River basin and is considering a complaint Texas filed against New Mexico over Rio Grande water. These developments – together with local disputes brewing over rights to water from the Brazos and Colorado rivers – have the potential to reshape Texas water law.
Thinking about conservation has, of course, evolved over time. Conservation of in-stream flows – necessary for healthy rivers and estuaries – would have been considered “waste” a few decades ago. Since the 1990s, state and local governments have pursued an admirable and increasingly aggressive form of conservation intended to make water use more efficient.
These efforts have yielded significant benefits. A report last year from the Alliance for Water Efficiency and the Environmental Law Institute ranked Texas and California as having the best water conservation laws and policies in the country.
Without these, the 2011 drought would have wrung that much more pain, and the supply shortfalls the State Water Development Board has predicted would be that much more ominous. Still, for all of this progress, Texas has room for improvement.
Many state leaders regard the 2012 State Water Plan as a starting point for policy discussions and a blueprint for operational solutions. The plan includes many new dams and reservoirs but relies on conservation and reuse for about a third of the additional supplies needed by 2060. That number underestimates the importance of conservation.
Conservation strategies are more cost-effective than new infrastructure, but even they come with financing challenges. The strategies are often achieved through many diffused small-scale projects and management practices. But individual property owners have little reason apart from general public-spiritedness to implement such practices unless required or incentivized to do so. Market barriers such as extended payback periods for conservation investments and split incentives between landlords and tenants might discourage property owners from making the upfront outlays needed to meaningfully improve conservation.
Given the wariness of many Texans toward governmental regulations, conservation cannot thrive on mandates alone. Instead, lawmakers should allow the market to provide economic incentives that encourage conservation.
Across the country, state and local governments have pioneered innovative programs that address market barriers in the context of energy efficiency and conservation. In policy circles, contractual tax assessments – often referred to as Property Assessed Clean Energy, or PACE, – and utility on-bill financing have attracted broad and growing bipartisan support. The Legislature may facilitate these policies by, among other things, expanding existing PACE statutes to encompass water and allowing liens to run with utility meters.
This session, the Legislature has the opportunity to achieve the water security for Texas and to ensure that inadequate water supplies do not sabotage an economic engine that other states have long marveled at and envied.
But to truly act upon this opportunity, the Legislature must double down on its commitment to conservation and consider creative, market-based solutions. That will require crafting a suite of policies that is as intricate and flexible as water usage itself. Fortunately, lawmakers can include policies like PACE and on-bill financing that fit with the free enterprise ethos and property rights tradition of Texas.
BY MELINDA E. TAYLOR AND JEREMY M. BROWN
Special to the Star-Telegram
The Texas Supreme Court once observed that the “story of water law in Texas is also the story of its droughts.” It should not be surprising, then, that with the state in the midst of a difficult drought and long-term supply shortages looming, a new chapter is being added to the story of Texas water law.
Gov. Rick Perry has voiced support for a growing cohort of legislators who are calling for a major infusion of state funding for new water infrastructure.
Meanwhile, the U.S. Supreme Court has agreed to hear an interstate dispute over rights to water in the Red River basin and is considering a complaint Texas filed against New Mexico over Rio Grande water. And local disputes are brewing over rights to water from the Brazos and Colorado.
For decades, leaders here have struggled to create a water regime that meets the evolving water needs of a vast, diverse and dynamic state.
Texans have long recognized the importance of conserving water. In 1917, Texas amended its constitution to provide that the “preservation and conservation” of water are “public rights and duties.”
Thinking about conservation has evolved, too. Conservation of in-stream flows — necessary for healthy rivers and estuaries — would have been considered “waste” a few decades ago.
Since the 1990s, state and local governments have pursued an admirable and increasingly aggressive form of conservation intended to make water use more efficient.
These efforts have yielded significant benefits. Last year, the Alliance for Water Efficiency and the Environmental Law Institute ranked Texas and California as having the best water conservation laws and policies in the country.
Without these, the 2011 drought would have wrung much more pain and the supply shortfalls that the State Water Development Board has predicted would be much more ominous. Still, Texas can improve.
Many state leaders regard the 2012 State Water Plan as a starting point for policy discussions and a blueprint for solutions. The plan includes many new dams and reservoirs but relies on conservation and reuse for about a third of the added supplies needed by 2060. That underestimates the importance of conservation.
Conservation strategies are more cost-effective than new infrastructure, but they also involve financing challenges. And individual property owners have little reason apart from general public-spiritedness to implement practices without mandates or incentives.
Landlords, for instance, have no reason to invest their own money in low-flow fixtures that will cut utility costs for tenants; and factory owners who intend to sell their property in the near term may want to avoid the financial risk of installing water-saving machinery that will take time to pay for itself.
Well-designed legislation can overcome market barriers like these and allow economic incentives to drive conservation.
Across the country, state and local governments have already pioneered innovative programs that address barriers to energy efficiency. Given the many parallels — and the connection — between energy and water use, these programs could lend themselves to water conservation.
Texas already allows property owners to pay for certain energy improvements with financing secured by tax liens. And several states have experimented with programs that let utility customers repay energy efficiency loans through utility bills and secure the financing with liens on utility services. These techniques could be applied to water.
This session, the Legislature has the opportunity to promote the water security of Texas and ensure that inadequate water supplies do not sabotage an economic engine that other states have long marveled at and envied.
But to truly act upon this opportunity, the legislature must double down on its commitment to conservation and consider creative, market-based solutions. Fortunately, lawmakers can rely on proven policies that fit with the free enterprise ethos and property rights tradition of Texas.
Melinda E. Taylor is executive director and Jeremy M. Brown is a research fellow at the Center for Global Energy, International Arbitration and Environmental Law at the University of Texas School of Law.
The Center will shape the program so that it engages student academic and career interests while furthering ongoing Center efforts. Above all, the program is flexible. The precise roles that interns play will depend upon intern preferences and the activities the Center has underway. In the past, for instance, interns have assessed the impact of Texas budget cuts on environmental enforcement and have assisted in cutting-edge research on hydraulic fracturing.
It is likely interns will assist in projects that arise from the 2013 session of the Texas legislature. During the session, the Center will be actively involved in discussions surrounding policies related to energy and the environment and particularly water supply. Interns may assist in researching policy proposals, developing best practices or other guidance for agencies implementing new legislation, or commenting upon rules the agencies are promulgating.
Additionally, students may assist in projects intended to improve regulatory processes and to shed light on environmental enforcement practices in Texas. Past interns, for instance, have assessed the impact of state budget cuts the Texas Council on Environmental Quality.
The Center is directed by Melinda Taylor, a law school senior lecturer who teaches courses in environmental law and coastal watersheds, and is affiliated with several other permanent and visiting faculty members who are experts in the fields of environmental, energy and natural resources law.
Law students will work closely with Professor Taylor and the Center’s research fellow, Jeremy Brown, and will have the opportunity to attend academic seminars, policy strategy sessions meetings and meetings with the Center’s board of advisors, many of whom are practitioners at leading Texas law firms.
The internship program is paid and will serve as sound preparation for a career in environmental or energy law and policy. If interested, please send a resume, cover letter and writing sample to Gena Dawson at firstname.lastname@example.org.
The Law School’s Center for Global Energy, International Arbitration, and Environmental Lawhas rolled out a cutting-edge legal blog with an inaugural post on hydraulic fracturing from Professor David Spence.
UT Law Grid will contribute to vital academic and policy debates in the Energy Center’s core subject areas with regular updates from University of Texas professors, prominent practitioners, lawmakers, and policy experts. In particular, as the Texas Legislature begins its 83rd session in January 2013, the Center will use the blog to participate in relevant policy discussions around water and energy issues.
“The Center already acts as an academic node, bringing together leading lights in energy and environmental law,” said David Spence, an associate professor at the Law School and the McCombs School of Business. “It was only natural for the Center to have a virtual presence that reflects its role within the university.”
Spence’s post explores issues surrounding the most game-changing innovation in the energy industry this century, hydraulic fracturing. Specifically, the post considers environmental benefits of natural gas and hydraulic fracturing compared to the use and extraction of coal and argues that anti-fracking laws may protect the local at the expense of the broader environment.
“David Spence has stature in energy law and, with connections to both the business and the law schools, embodies the inter-disciplinary spirit of UT Law Grid,” said Melinda Taylor, the Energy Center’s executive director and a senior lecturer at the Law School. “His post could have easily been an opinion piece in a top newspaper, and we are grateful that he has chosen our blog as a forum for his work.”
Going forward, UT Law Grid will build upon Spence’s piece with related posts on fracking land-use laws and new fracking regulations that the Texas Railroad Commission is creating. The scope of the blog will be as encompassing as that of the Energy Center itself, however.
The blog will take advantage of the Energy Center’s location, in the capital of the state that is home to the energy industry, but it will have global vision and will draw from the Energy Center’s international activities, particularly in Latin America.
“We have to prepare our students to practice in areas such as energy and environmental law that are increasingly global in scope,” said Ward Farnsworth, dean of the Law School and John Jeffers Research Chair in Law. “Fortunately, the University of Texas has an outstanding reputation around the world, and the Energy Center and David Spence are making that reputation even stronger.”
UT Law Grid, with Spence’s piece and other posts, is available on the Energy Center’s home page, at http://www.utexas.edu/law/academics/centers/energy/.
About the Energy Center: The Center for Global Energy, International Arbitration, and Environmental Law at the University of Texas School of Law offers an extensive and unique curriculum to students interested in these areas of the law. The Center is also a focal point for interdisciplinary analysis, debate, and discussion of the legal and policy issues relevant to energy, arbitration, and the environment.