News

David Spence, “How Enron changed regulation” (Marketplace)

A July 18 segment from NPR’s Marketplace explores the Federal Energy Regulatory Commission’s recent enforcement activities targeting financial companies.  For expert perspective, the segment quotes UT Law Professor David Spence.

“Banks have slowly gotten into that same space that Enron used to occupy,” Spence explains.  Financial institutions now dominate energy trading and, as a result, have greater incentive to manipulate energy markets.

Student Group Petitions Texas to Revise Controverisal Drought Rule

The University of Texas Regulatory Oversight Group (UTROG) has petitioned the Texas Commisison on Environmental Quality (TCEQ) to revise a regulation that allows the agency to selectively suspend water rights during droughts.

The petition calls for TCEQ to add procedural safeguards, improve conservation requirements, and further limit the circumstances under which the agency can exercise the rule.

“The Drought Curtailment Rule represents a well-intentioned first effort to craft a mechanism that could balance competing interests while shepherding the state through water shortages,” the petition states. “Recent litigation and policy debates have resulted in controversy about the rule and its implementation. These proposed amendments are designed to clarify the circumstances under which the executive director can suspend senior water rights and incentivize conservation.”

UTROG consists of students who are participating in a law school seminar in environmental regulation and are overseen by two professors. In preparing the petition, students consulted with leading water lawyers and reviewed comments the TCEQ received when it initially proposed the drought rule.

Energy Center Releases White Paper on PACE in Texas

The Center for Global Energy, International Arbitration and Environmental Law at the University of Texas School of Law has published a white paper that uses a bill now winding through the Texas legislature as a springboard to explore recent trends in property assessed clean energy (PACE).

PACE is a mechanism that allows property owners to voluntarily subject their properties to tax assessments. The assessments are similar to those historically used to pay for public projects like sidewalks or streetlights but instead finance conservation improvements on privately owned property.

In the late 2000s, PACE appealed to captivated environmental policymakers as a means of promoting the adoption of energy efficiency and on-site renewable energy improvements. Actions by federal mortgage regulators stunted the use of PACE for single-family homes, however, and until relatively recently chilled the growth of PACE programs.

Lately, however, state and local governments have reoriented PACE around commercial real estate and attracted new supporters and capital sources.

Texas passed PACE enabling legislation in 2009, but it never led to the development of an operational PACE program. This legislative session, a bill that is steadily moving through the capitol would correct certain drafting flaws in the original enabling legislation while building upon evolving PACE best practices. In particular, the bill would:

  • Refocus PACE around commercial, industrial and multi-family properties;
  • Allow counties and coalitions of local governments to launch PACE programs;
  • Allow the PACE financing of water conservation improvements
  • Permit PACE borrowers to obtain financing from third-party lenders;
  • Require existing lenders to consent to PACE liens

For more information, please contact the white paper’s author, Jeremy Brown, at jeremybrown@law.utexas.edu or 512-232-1408.

 

OSHA Admits Program Flaws, in Response to Student Petition

In March, as part of a practial seminar in environmental litigation, University of Texas School of Law students petitioned the Ooccupational Health and Safety Administration to make changes to a program intended to reward high-performing workplaces and to encourage greater voluntary safety measures.

Working under the name University of Texas Regulatory Oversight Group (UTROG), the students identified several critical flaws in the OSHA’s Voluntary Protection Program (VPP) and petitioned for the agency to address these flaws through a formal rulemaking.

In its response to UTROG, OSHA declined to amend the program due to “current budgetary constraints” but acknowledged VPP’s shortcomings.

“We share your belief that making more information regarding VPP participants available via the OSHA Web site will increase transparency, accountability and accessibility within the program,” wrote Douglas J. Kalinowski, OSHA’s director of cooperative and state programs. “We also agree that increased accessibility of this information will help share VPP participant experiences and best practices … [W]e will definitely explore ways to implement your suggestions as part of a larger effort to improve the program and address the VPP Review Team recommendations.”

David Spence, “Should the Federal Government Regulate Fracking?” (Wall Street Journal)

Professor David Spence has published a point-counterpoint editorial in the Wall Street Journal on federalism and fracking with Harvard Law School professor Jody Freeman.

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, “Environmental lawyer skeptical of need for new federal fracking legislation” (SNL Financial)

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.

Students Comment on Alaska Fracking Regulations

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.

Melinda Taylor and Jeremy Brown, “It’s time to link funding for water projects to conservation” (Houston Chronicle)

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.

UT Law Squad Competes in ’13 Vis Moot

Vienna 2

 

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.”