Vol. 52-1 Recent Publications




J.B. Ruhl* and Robin Kundis Craig


May 2021



The impacts of climate change are upon us. Recent climate change policy discussion emphasizes adaptation, rather than mitigation. This shift reflects a sober recognition that avoiding 2 degrees (Celsius) of warming, a central goal of climate mitigation efforts, is highly unlikely given the amount of greenhouse gases already emitted and the continued growth of global emissions. Illustrating this point, the Intergovernmental Panel on Climate Change’s most recent (Sixth) Assessment concluded that under any scenario, whether or not global greenhouse gas emissions reach net negative, the global surface temperature will continue to increase until at least mid-century.  Global surface temperature will increase by at least 2 degrees Celsius during the 21st century unless deep reductions in greenhouse gas emissions occur within the next few decades.

While reducing greenhouse gases remains critical to staving off the worst effects of climate change, awareness that a changing climate is our present and future has given rise to more discussion and study of how to best adapt to the impacts of climate change and build climate resilience. Growing evidence, including the recently published IPCC report, show the range of disruptive impacts that varying levels of global temperature rise will bring.  IPCC data indicates that changes in the climate system become larger in direct relation to increasing global warming, including “increases in the frequency and intensity of hot extremes, marine heatwaves, heavy precipitation, agricultural and ecological droughts in some regions, and proportion of intense tropical cyclones, as well as reductions in Arctic sea ice, snow cover and permafrost.”


The key issue of adaptation policy is how to best adapt to a changing climate. The answer to this question depends on determining the baseline assumptions of the scale and severity of climate impacts. This is why meta discussion of the proper adaptation response largely centers on the expected global temperature increase and the local or regional impacts that this temperature increase will bring. Obviously, the climate adaptation measures for 2 degrees of warming will be inadequate if the planet warms by 4 degrees. This concern for basing adaptation measures on inaccurate future temperature rises informs the recently published article, 4°C , written by J.B. Ruhl and Robin Kundis Craig.  Ruhl and Craig caution that adaptation measures based on the goal of limiting warming to 2 degrees are unworkable given that most peer-reviewed climate models now show that 2 degrees of warming will likely be exceeded this century.  While Ruhl and Craig still advocate for a mitigation strategy focused on limiting warming to 2 degrees, they urge policymakers to separately shape their adaptation policy plans based on 4 degrees of warming, at a minimum.  They call this  “dual-minded approach to climate change . . . necessary to simultaneously give the planet the best future possible (mitigation governance) while preparing humanity for the worst of the probable realities (adaptation governance).”

Ruhl and Craig pull together scientific studies to examine what a world of 4 degrees warming may look like. First, Ruhl and Craig note that the impacts of climate change with rising temperatures are nonlinear. By this, they mean that each increment of warming brings multiplying and accelerating impacts, and at some threshold, changes these changes become transformative—“fundamentally altering social-ecological systems into new states of being.”  To illustrate the nonlinearity of climate impacts as the planet warms, the authors cite a 2019 study that looked at 30 different climate change impacts and concluded, among other things, that “the global average chance of a major heat wave increases from 5% in 1981–2010 to 28% at 1.5 °C and 92% at 4°C[.]”

Drawing from studies of climate impacts, Ruhl and Craig suggest that the overlapping and interrelated changes to social-ecological systems at 4 degrees Celsius will result in an utterly new world. Water scarcity, food supply disruptions, increased flooding, loss of land mass to sea level rise, and longer and more intense wildfires are predictable impacts, but the uncertain severity and cascading effects raise added adaptation planning concerns. Increases in forest fires and even drought in low-lying coastal areas will result in the virtually assured mass-migration of human populations. Beyond this, water scarcity could lead to social conflict, meanwhile increased precipitation in areas would result in greater runoff that could overwhelm stormwater infrastructure and wastewater treatment facilities.

While severe impacts of climate change are assured with rising average temperatures, the scale and severity of these impacts and the corresponding human reaction to such effects makes climate adaptation inherently difficult. However, as Ruhl and Craig argue, this makes the need for more robust adaptation measures all the more imperative. In short, the policy goals of adaptation must meet the needs of what would be a significant shift of human populations and their support systems “northward and inward, while simultaneously preserving (or opening up) lands for agriculture, species habitat, and migration corridors.”


The main thrust of Ruhl and Craig’s argument is that a shift in adaptation policy assumptions, commensurate with an expected 4 degrees of warming, will necessitate a shift in conventional climate adaptation policies.  Standard adaptation policy centers on a combination of the “Three Rs” — resistance, resilience, and retreat.  Ruhl and Craig note that this adaptation strategy, which primarily emphasizes resistance and resilience, is incremental and place-based adaptation.

Resistance—also known as protecting, defending, or fortifying—emphasizes building infrastructure to protect human communities.  Sea walls, which physicall resist stormwater surges amid rising sea levels, are a prominent resistance measure,. Resilience includes “social-ecological systems” that build resilience to climate change impacts like heat waves, like improving urban populations’ capacity to withstand heat waves.

Resilience policies, focused on adjustment and management of climate impacts, are designed to increase community capacity to cope with climate impacts where the impacts cannot be resisted or adequately mitigated.  Resilience measures can be wide-ranging. For example, resilience could include subsidizing greater air conditioning installation in older urban housing or, in rural, agrarian context, planting diverse, drought-resistant, crops.

Finally, where resistance or resilience efforts are not adequate, retreat involves leaving areas where the impacts cannot be combatted—think coastal communities leaving areas where sea level rise is unavoidable despite sea walls.  Or even where sea walls stop storm surge, the saltwater may intrude groundwater, impairing the drinking water supply of the community.

After surveying the science of the potential impacts of climate change in a world of 4-degree temperature increase, the authors state that the scope and intensity of these impacts will render the “Three Rs” insufficient to achieve adaptation.  Ruhl and Craig identify the relatively adjunct, secondary focus on adaptation to the primary concern of mitigation facilitated by the emphasis placed on incremental, “in situ” (in place) adaptation strategies like resilience and resistance. This climate policy of the past made sense when the political community hoped that limiting warming to 2 degrees, or even 1.5 degrees, seemed a workable mitigation goal. In light of an increased likelihood that warming will not be limited to 2 degrees, “future proofing” policies will likely be insufficient in many areas of high climate vulnerability.


Ruhl and Craig posit that the associated climate impacts of temperature rise beyond 2 degrees Celsius requires a fourth climate change adaptation policy strategy that focuses on “redesign.”  In short, the “redesign” approach emphasizes radical and sweeping measures to “reconfigure and relocate our nation’s population distribution, land uses, infrastructure, economic and production networks, natural resource management, and other social, ecological, and technological systems.”

This is a radical shift in adaptation policy, and the authors further define what a “redesign” policy is. First, they say it encompasses letting go of intact, in situ adaptation. This is a recognition that 4 degrees of warming will fundamentally alter climate systems and will often require populations to move. For example, while resistance and resilience strategies allow for keeping agriculture in situ but adapting drought-resistant crops or water-conserving irrigation techniques, redesign would likely mean relocating agricultural crop and livestock lands to areas more suitable for these activities in a transformed climate of 4 degree warming. The authors say that “redesign is about designing and facilitating–perhaps even requiring–the relocations and reconfigurations necessary for these adaptations to succeed.”

Second, and, as the authors suggest, more importantly, redesign requires a shift from the “inward-looking” state and local planning of the Three Rs to more “outward-looking,” inter-regional or national planning. This is because 4 degrees of warming will have differential regional impacts that will lead to population migration and require broad-scale planning to manage the acute regional risks that will undoubtedly impact other areas. This “outward-looking” planning allows for a more integrated response rather than disjointed, locally-dependent measures that are often characteristic of resistance and resilience policies.

    Recognizing the incredible challenge of actualizing an adaptation plan of this magnitude, Ruhl and Craig focus the last section of their article on how to conceptualize, plan, and implement redesign adaptation. In summary, the main discussion centers on implementation of redesign adaptation by looking at the high-level tools available to effectuate this broad-scale adaptation policy.


In the last section of their article, Ruhl and Craig pay special attention to how an adaptation strategy centering redesign policies can be planned and implemented. While recognizing the “gross simplification” of “reducing adaptation governance to three top-level modes,” Ruhl and Craig discuss and analyze Laissez Faire, Planning and Prompting, and Preemption and Mandates as the high-level tools for implementing a redesign adaptation policy. The authors note that all of these tools have their pros and cons and should be harnessed together to varying degrees to effectuate redesign adaptation policies that meet the challenges of 4 degrees of warming.

In fact, the authors suggest that the greatest challenge to governance of adaptation redesign is the disruptive and simultaneous changes that temperature increase will involve.  They specifically mention that some impacts, such as sea level rise, will be gradual and linear. These changes are easier to plan for in an adaptation context. But nonlinear changes, such as increased storm intensity, and cascading changes, such as human migration from triggering events, will assuredly be less predictable and difficult to respond to without prior anticipatory planning.  Therefore, all of the tools for implementing a comprehensive adaptation strategy must be harnessed.

Regarding laissez faire tools, the author’s note that “the normal forces of supply and demand may in fact work surprisingly well to push and pull adaptation to a 4°C United States in the right directions.”  They exemplify this by noting that the private insurance industry has been a good indicator of weighing the financial costs and benefits of in situ climate adaptation.  Planning and prodding involve using incentives and disincentives, such as tax subsidies, to motivate redesign adaptation.  Preemption and mandates are the most heavy-handed approach whereby government mandates would intervene to force redesign adaptation.

In looking at the tools, laissez faire is helpful in responding to linear change, but limited when responding to nonlinear changes that tend to be unpredictable. The private market relies on information and predictability, something that 4-degrees of warming will not foster. The article highlights the way that private insurance companies stopped insuring homes in areas vulnerable to Hurricanes and storm surges in the Gulf or wildfires in the West. Similarly, private insurance companies have given up insuring areas of high flood risk. Meanwhile, planning/prodding and preemption/mandates are necessary and effective when used in tandem to ensure that redesign adaptation policies are being adequately implemented in the areas most vulnerable to severe climate impacts. These are the tools most critical to planning for nonlinear and cascading change.

In essence, the article does not delve into overly specific or prescriptive laws to effectuate a redesign adaptation policy. Instead, the authors categorize the modes of change (linear, nonlinear, and cascade change) that 4 degrees of warming will bring on and the governance tools available to implement a redesign adaptation plan. In doing so, Ruhl and Craig provide a high-level conceptual framework for how to utilize these tools to implement redesign-focused adaptation plans that prepare for the massively complex and urgent changes that a world of 4-degrees of warming will likely bring.


Liam Veazey is a 3L from Dallas, Texas, who received his undergraduate degree from St. Francis College Brooklyn. He plans to practice as a public interest attorney in the substantive areas of environmental justice, housing, and community development. Immediately after law school, he will begin a public interest law fellowship at Legal Assistance of Western New York.

Josh Katz is a partner at Bickerstaff Heath Delgado Acosta LLP and represents public and private entities before agencies and in state and federal court in the areas of environmental law, municipal law, water rights, and utilities.


Vol. 52-1 Utilities




In February 2021, winter storm Uri swept from the Pacific Northwest to the East Coast, leaving many in southern states without basic resources like electricity and water.[1] Texas was especially hard-hit, due in part to its lack of winter-weather-capable infrastructure.[2] Two hundred and ten residents died as a result of the storm, due mostly to hypothermia.[3] Millions more lost power for multiple days.[4] Even at the disaster’s beginning, it was immediately clear to electric grid operators within the Energy Reliability Council of Texas (ERCOT) that electricity generation was failing and would be unable to meet soaring demand.[5] Operators ordered distribution companies to shed load, leading to controlled outages[6] that left almost 70% of ERCOT customers without power for an average of 42 hours during the storm.[7]

When state legislators reconvened after the storm, they clamored to pass a torrent of legislation in response to the spectacular failure of Texas’ primary electric grid. Many state politicians blamed renewable sources of energy for the grid’s failure, with a conservative news correspondent even claiming “it seems pretty clear that a reckless reliance on windmills is the cause of this disaster.”[8] Contrary to these claims, however, failures throughout the natural gas supply and generation chain were mostly to blame for the failure in electricity generation.[9] Despite this fact, the legislative response to the grid’s performance during the winter storm keeps one eye pointed toward renewable sources of energy and opens the door to financially penalizing these sources through rulemaking, while neglecting to remediate the issues that resulted in the failure of natural gas facilities and related supply issues. 


Renewables’ Performance During the Storm

            At the peak of the blackouts, the highest amount of unavailable electricity due to generator outages and underperformance was 52,037 megawatts (MW).[10] For comparison, ERCOT has an expected total peak capacity of about 78,000 MW,[11] meaning that during the worst part of the storm, only 33% of the grid capacity was available for use. While all sources of energy failed to some extent during the storm, ERCOT notes that thermal sources—including coal, natural gas, and nuclear—lost nearly twice as many gigawatts of power as renewables.[12] ERCOT had previously prepared a worst-case extreme winter scenario, in which it expected to lose 14,000 MW of thermal resources.[13] In reality, thermal outages were more than twice that high during Uri[14], while demand was also 10,000 MW higher than projected.[15] Meanwhile, renewable energy sources contributed to only 13% of the power outages[16] and, importantly, wind power had only been projected to make up about 7% of ERCOT’s winter grid capacity to begin with.[17] In a post-storm report, an independent director of the ERCOT board stated that “relative to expectations, renewables overperformed, and thermal plants underperformed during the crisis.”[18]

            The across-the-board failures of the grid were due to a lack of winterization, as all types of power generation were left susceptible to freezing.[19] The federal government had previously warned ERCOT about its lack of weatherization after significant blackouts on Super Bowl Sunday in 2011.[20] An analysis from federal agencies after the 2011 blackouts advised power producers and natural gas suppliers in Texas to winterize in order to prevent future weather-related blackouts.[21] Additionally, the report pointed out a regulatory blind spot that left grid operators not knowing what facilities to prioritize when shedding load.[22] Power operators and gas suppliers had the option to file paperwork designating themselves as critical infrastructure, yet many had failed to file the 2-page document.[23] Although the 2011 report urged Texas regulators to correct these problems, power producers and natural gas suppliers were both repeat offenders during winter storm Uri.[24]  Clearly, the state’s response to such warnings has been inadequate. Power companies have complained that low electricity prices provide no incentive to make such improvements, but new laws may finally push generators to make changes.[25] 


Legislative Response

            New law SB 3 stands out from a flurry of new legislation as the most significant bill impacting suppliers of renewable energy. This bill deals with ancillary services, which are additional power resources beyond those needed to meet real-time customer demand that act as insurance in case of an unexpected interruption to the grid. It is imperative that there is at least enough electricity supply to match demand at all times—if demand exceeds supply and causes the frequency of the grid to drop outside its operating range, it can cause physical damage to infrastructure and lead to a complete failure of the grid for weeks.[26] Ancillary services are an important counterpart to nondispatchable sources of energy, or sources that cannot be turned on and off at will. Because wind and solar generation are nondispatchable and variable by nature, ERCOT purchases ancillary services as a back-up in case they fail to generate as much power as expected.[27] Currently, the cost of ancillary services are distributed among consumers,[28] but SB 3, which became effective immediately upon signing on June 8, now shifts at least some of the burden to renewable energy providers.[29] 

            SB 3 amends the Texas Public Utility Regulatory Act (PURA) to require the Public Utility Commission of Texas (PUC) to determine whether existing ancillary services continue to meet the needs of the ERCOT market by reviewing existing services and their costs.[30] This amendment also requires ERCOT to modify the design, procurement, and cost allocation of ancillary services “in a manner consistent with cost-causation principles and on a non-discriminatory basis.”[31] Although this cost allocation appears sound, agencies promulgating such cost-causation principles will face challenges in defining them due to the highly variable nature of consumer demand and the intermittency of non-dispatchable wind and solar generation.[32] New rulemakings could shift the relative allocation of costs of ancillary services either to renewables or across multiple categories of generation, but ultimately the final cost decisions are placed on the regulators defining cost-causation principles.[33]

            The bill also requires the PUC to oversee ERCOT in determining the amount and type of ancillary services needed to ensure reliability during extreme heat or cold events and when intermittent sources of generation like wind and solar are low.[34] This review must be conducted at least annually.[35] ERCOT must procure such ancillary services on a competitive basis and ensure that they are dispatchable, reliable, and capable of continuous use during extreme weather in the season for which the service is procured.[36]

            Lastly, SB 3 requires the PUC to promulgate rules requiring most electricity generation providers to implement weatherization measures.[37] Furthermore, providers of generation that experience “repeated or major weather-related forced interruptions of service” must contract with third-parties to assess their weatherization efforts and must comply with any recommendations in such assessment if ordered to do so by the PUC.[38] This provision will impact both renewable and thermal generators.

            As a separate matter, SB 1281 requires ERCOT to assess the grid’s reliability in possible extreme weather scenarios every other year. These assessments will consider the impacts of both thermal and renewable generation and recommend transmission projects that will increase the reliability of the grid.[39] 

Proposed Railroad Commission (RRC) rulemakings stemming from recent legislation would require facilities all along the natural gas supply chain to file critical infrastructure paperwork or else face a penalty of $2,500.[40] This rule differs from the previous system, under which facilities that wished to be designated as critical were merely encouraged to submit such paperwork on their own initiative.[41] While affected operators would now be required to file critical infrastructure paperwork, they would retain the option to either designate themselves as critical or simply pay $150 and declare they are opting out of the designation if they are not equipped to operate during a weather emergency.[42] Facing the costs of weatherization to ensure operability in weather emergencies, it may be more economical for some facilities along the natural gas supply chain to opt out of the critical designation and allow themselves to be shed during power shortages.  


Problem Solved?

            The mere fact of legislative focus on ancillary services seems to imply that ERCOT’s current level of reliance on non-dispatchable sources like wind and solar is what caused the massive outages during winter storm Uri. In light of this political framing, agencies may choose to allocate a high proportion of ancillary service costs to renewable generators, potentially impacting the growth of the renewable market and in turn limiting the amount of renewable generation the grid relies on. The implication that even low reliance on renewables leads to outages is contrary to the truth that renewable sources overperformed during Uri as compared to expectations while thermal sources drastically underperformed even worst-case scenario projections. 

Because a lack of weatherization is to blame for the gross underperformance of all types of generation during Uri, procuring additional ancillary services is likely not enough to prevent future outages. Even with more such services waiting in the wings, they will not serve their purpose as reliable safeguards if they are not properly weatherized. Priority should be placed on building the resiliency of primary sources of generation rather than on procuring a greater number of equally vulnerable sources. The natural gas supply and generation chain is in most urgent need of weatherization as it makes up the majority of ERCOT’s electricity mix and has proven to be susceptible to extreme cold. While renewable sources also need weatherization, spotlighting them in the conversation distracts from the pressing need to weatherize the thermal sources that provide most of Texas’ electricity. 

Pending rulemakings will determine the extent to which generators will be required to weatherize beyond what market forces acting alone have called for. Proposed rules from the RRC would allow natural gas suppliers to sidestep weatherization by simply opting out of a critical infrastructure designation. The RRC has long been criticized for its intimate ties to the oil and gas industry; recently, the Commission used a list of nominees hand-selected by industry leaders to appoint 4 of its 5 seats to the Texas Energy Reliability Council.[43] It is perhaps then unsurprising that rules proposed thus far by the RRC do little to impose greater regulation or mandate weatherization. 

Only time will tell whether new rules’ resiliency standards combined with ERCOT’s biannual projections of extreme weather events will be adequate to prepare grid operators to manage the next major storm or draught. In analyzing why engineers made bad decisions that led to the Challenger explosion, Astronaut Alan Sheppard said “it’s the human element. I suggest that there’s a complacency there that comes from success.”[44] Perhaps Uri was a wake-up call to Texas’ comfortably complacent energy market. The next storm will reveal whether this session’s slate of legislation answered it sufficiently. 


Alessandra Papa is a 2L studying energy and environmental law. As TELJ’s Symposium Director, she produced the 2022 Symposium on Legal System Changes to Address Climate Change and the Energy Transition in conjunction with the Texas Bar’s ENRLS. She has also been selected to serve as Editor-in-Chief of Volume 53. Alessandra grew up in Fort Worth, Texas and received a B.S. in Geography from Texas A&M. Her background in geoscience informs her legal studies and she looks forward to a career advocating for renewable energy.


Alisha Mehta is an attorney in the Environmental and Legislative section of Jackson Walker’s Austin office. She focuses on permitting and water matters, including real estate developers and special utility districts and counsels clients on transactional and regulatory issues before the Public Utility Commission of Texas.


[1] Theresa Machemer, How Winter Storm Uri Impacted the United States, Smithsonian Magazine: Smart News (Feb. 19, 2021), https://www.smithsonianmag.com/smart-news/how-winter-storm-uri-has-impacted-us-180977055/.

[2] Id. 

[3] Tex. Dep’t of State Health Servs., Winter Storm-Related Deaths – July 13, 2021, Tex. Dep’t Health & Human Services: News Updates (Oct. 29, 2021), https://dshs.texas.gov/news/updates.shtm#wn.

[4] Machemer, supra note 1.

[5] Peter Cramton, Lessons From the 2021 Texas Electricity Crisis, Peter Cramton: Papers 2 (Sept. 6, 2021), http://www.cramton.umd.edu/papers2020-2024/cramton-lessons-from-the-2021-texas-electricity-crisis.pdf 

[6] Id.

[7] Neelam Bohra, Almost 70% of ERCOT Customers Lost Power During Winter Storm, Study Finds, The Tex. Trib.: Winter Storm 2021 (Mar. 29, 2021), https://www.texastribune.org/2021/03/29/texas-power-outage-ERCOT/.

[8] Aaron Rupar, Fox News Turns Winter Storm Uri Into a Cudgel to Own the Libs, Vox (Feb. 17, 2021, 3:25 PM EST), https://www.vox.com/2021/2/17/22287469/fox-news-winter-storm-uri-windmills-ercot-greg-abbott-hannity-carlson (quoting Tucker Carlson).

[9] Cramton, supra note 5, at 1.

[10] ERCOT, Update to April 6, 2021 Preliminary Report on Causes of Generator Outages and Derates During the February 2021 Extreme Cold Weather Event, Ercot Public 8 (Apr. 27, 2021), http://www.ercot.com/content/wcm /lists/226521/ERCOT_Winter_Storm_Generator_Outages_By_Cause_Updated_Report_4.27.21.pdf 

[11] ERCOT, Quick Facts, ERCOT 1 (Feb. 2018) http://www.ercot.com/content/wcm/lists/144926/ERCOT_Quick_ Facts_2518.pdf 

[12] Katie Shepherd, Rick Perry Says Texans Would Accept Even Longer Power Outages ‘To Keep the Federal Government Out of Their Business’, The Wash. Post (Feb. 18, 2021, 2:09 AM EST), https://www.washingtonpost.com/nation/2021/02/17/texas-abbott-wind-turbines-outages/.

[13] Cramton, supra note 5, at 1.

[14] Id. at 2.

[15] Cramton, supra note 5, at 8. 

[16] Shepherd, supra note 12.

[17] Dionne Searcey, No, Wind Farms Aren’t the Main Cause of the Texas Blackouts, The N.Y. Times (May 3, 2021), https://www.nytimes.com/2021/02/17/climate/texas-blackouts-disinformation.html.

[18] Cramton, supra note 5, at 8. 

[19] Id. at 18.

[20] James Osborne Et Al., Texas Grid Fails to Weatherize, Repeats Mistake Feds Cited 10 Years Ago, Houston Chronicle (Feb. 17, 2021, 2:25 PM), https://www.houstonchronicle.com/business/energy/article/Texas-grid-again-faces-scrutiny-over-cold-15955392.php.

[21] Jeffrey Ball, The Texas Blackout Is the Story of a Disaster Foretold, Texas Monthly (Feb. 9, 2021), https://www.texasmonthly.com/news-politics/texas-blackout-preventable/.

[22] Jay Root, Et Al., This Simple Paperwork Blunder Left Texans Cold During the Deadly Freeze, Houston Chronicle (Mar 18, 2021, 1:31 PM), https://www.houstonchronicle.com/politics/texas/article/Simple-paperwork-blunder-Texans-cold-winter-storm-16032163.php 

[23] Id.

[24]Neena Satija & Aaron Gregg, Ten Years Ago, 241 Texas Power Plants Couldn’t Take the Cold. Dozens of them Failed Again This Year., The Wash. Post (Mar 6, 2021, 9:55 AM),  https://www.washingtonpost.com/nation/ 2021/03/06/texas-power-plants/ 

[25] Osborn, supra note 20. 

[26] Matt Largey, Texas’ Power Grid Was 4 Minutes and 37 Seconds Away from Collapsing. Here’s How it Happened., KUT Austin (Feb. 24, 2021, 3:09 PM CST), https://www.kut.org/energy-environment/2021-02-24/texas-power-grid-was-4-minutes-and-37-seconds-away-from-collapsing-heres-how-it-happened.

[27] S. Res. Ctr., Bill Analysis, Tex. S. 87(R)-87R8893 JXC-F (Tex. 2021), https://capitol.texas.gov/tlodocs/87R/analysis/html/SB01278I.htm

[28] Id. 

[29] Shawn Mulcahy & Erin Douglas, Sweeping Legislation to Overhaul State’s Electricity Market in Response to Winter Storm Heads to Texas House After Senate’s Unanimous Approval, The Tex. Trib.: Tex. Legislature 2021 (Mar. 29, 2021, 7:00 PM CST), https://www.texastribune.org/2021/03/29/texas-senate-electricity-power/.

[30] S.B. 3, 87 Leg. (Tx. 2021) https://capitol.texas.gov/tlodocs/87R/billtext/pdf/SB00003F.pdf#navpanes=0

[31] Id. 

[32] Herman K. Trabish, ‘A Terrible Idea’: Texas Legislators Fight Over Renewables’ Role in Power Crisis, Aiming to Avert a Repeat, Utility Dive: Deep Dive (May 17, 2021), https://www.utilitydive.com/news/a-terrible-idea-fight-over-renewables-role-in-texas-february-power-cri/599842/.

[33] Id. 

[34] S.B. 3, 87 Leg. (Tx. 2021) https://capitol.texas.gov/tlodocs/87R/billtext/pdf/SB00003F.pdf#navpanes=0

[35] S.B. 3, 87 Leg. (Tx. 2021) https://capitol.texas.gov/tlodocs/87R/billtext/pdf/SB00003F.pdf#navpanes=0 (amending Utility Code § 39.159(b)(2)). )

[36] S.B. 3, 87 Leg. (Tx. 2021) https://capitol.texas.gov/tlodocs/87R/billtext/pdf/SB00003F.pdf#navpanes=0 (amending Utility Code §§ 39.159(b)(3) and 39.159(c)(1)). SB 3, amends utility code § 39.159 (b)(3) and (c)(1)

[37] S.B. 3, 87 Leg. (Tx. 2021) https://capitol.texas.gov/tlodocs/87R/billtext/pdf/SB00003F.pdf#navpanes=0 (amending Utility Code § 35.0021(b))

[38] S.B. 3, 87 Leg. (Tx. 2021) https://capitol.texas.gov/tlodocs/87R/billtext/pdf/SB00003F.pdf#navpanes=0 (amending Utility Code § 35.0021(d-e))

[39] S.B. 3, 87 Leg. (Tx. 2021), https://capitol.texas.gov/tlodocs/87R/billtext/pdf/SB01281F.pdf#navpanes=0 

[40] Texas Proposed Gas Regulations for Critical Infrastructure, RCP (Oct. 2021), https://rcp.com/texas-proposed-gas-regulations-for-critical-infrastructure/ 

[41] Root, supra note 22.

[42] Texas Proposed Gas Regulations for Critical Infrastructure, RCP (Oct. 2021), https://rcp.com/texas-proposed-gas-regulations-for-critical-infrastructure/

[43] Erin Douglas, Oil Industry Helped Handpick Members of Texas Advisory Group for Electric Grid Reliability, Emails Show,  The Tex. Trib. (Oct. 21, 2021, 4:00 AM), https://www.texastribune.org/2021/10/21/texas-railroad-commission-power-grid-council/ 

[44] Osborne, supra note 20.

Vol. 52-1 Waste



Natural Resource Damages: Grasping at the Value of Nature


How much money is a river worth? Some would find such a question laughable.  In conceptualizing the issue, at first, seemingly countless factors flow forth like a tidal wave. One must account for the organisms and people dependent on the river, its impact on surrounding ecosystems, recreational value, even sentimentality and hopes to pass on the resource to the next generation; and how does one even go about quantifying those values in the first place. Arriving at a real answer seems hopeless. If this impractical question were truly hypothetical, perhaps laughing would be the correct reaction; however, the legal concept and statutory claim of Natural Resource Damages (NRDs) forces such conceptual impracticality into the practical world of litigation, where the stakes involve real injured resources and shrinking pocketbooks. 

This article analyzes the framework of the Comprehensive Environmental Response, Compensation, and Liability Act, or CERCLA, NRDs and four of the leading methodologies used to assess them, to examine the philosophies and preferences underlying the valuation of natural resources in this context. The first part of the article explains, in basic terms, the framework of CERCLA’s NRDs and the tripartite conception of natural resource value. The second part analyzes four of the leading methodologies used under CERCLA to assess NRDs and how they attempt to account for each type of value of an injured natural resource. The third part makes observations about the current system of assessing NRDs and what the system reveals about the law’s conception of nature.

The CERCLA NRD Framework and the Three Values of Natural Resources

            Under CERCLA, otherwise known as Superfund, parties responsible for a release or threatened release of contaminants resulting in damage to natural resources within the public trust are responsible for compensating the public for the restoration of injured resources and the provision of services following cleanup.[1] Following remediation of hazardous substances at a given site, NRDs go into effect if there is “injury to, destruction of, or loss of natural resources” within the public trust.[2] Natural resources are defined as “land, fish, wildlife, biota, air, water, ground water, drinking water supplies, and other such resources belonging to, managed by, held in trust by, appertaining to, or otherwise controlled by” a state, local, or foreign government, the United States, or an Indian tribe.”[3] These entities are known as trustees, and they are charged with assessing injury to natural resources and restoring injured natural resources or services lost due to a release or threat of release.[4] Under CERCLA, the trustees may recover NRDs from potentially responsible parties (PRPs) through of suit or negotiation.[5] Before recovery, the trustees must perform a natural resource damage assessment (NRDA) in order to quantify the injury and damages, i.e., the cost of to restore the injured resources or the services they provided.[6] 

            The standard conception of natural resource value    includes three general types: use value, existence value, and intrinsic value.[7] Use value refers to the value that humans derive from the natural resource by using it for practical ends such as hunting and fishing, or the ecological services provided by the resources such as service in the food web.[8] Existence value is the value that resources have to humans aside from use, such as the desire to pass on the resources to future generations.[9] It encompasses the general idea that there are reasons why humans would want natural resources to exist even if they knew they would never directly interact with them.[10] Intrinsic value is the value that the resources have completely apart from humanity[11]. This is the idea that nature has a value in itself, just by virtue of being alive or otherwise part of the natural world.[12]

            Each type covers its own portion of the natural resource’s value and has its own strengths and weaknesses in application. Use value is perhaps the most straightforward, as judging how much a resource is used is at least quantifiable in theory. Still, it can be difficult to assign specific values to such use.[13] On the other hand, existence value is, even conceptually, very difficult both to quantify and value accurately. Most agree that nature they will never see is still valuable.[14] Perhaps they would like to keep the option to travelling there open, even if they never do, or to bequeath the natural resources they will never experience to a future generation. However, any monetary value placed on these desires will be speculative.[15] 

Lastly, intrinsic value is difficult in concept and near-impossible in application.[16] There is not even widespread acceptance of the concept, much less inclusion within a valuation methodology.[17] Intrinsic value is different from the other two in that it is the only one that is non-anthropocentric. It may seem attractive to recognize moral rights in nature to those who care for the environment, but the application of such rights in resource valuation is far from practical. It is not unheard of for the law to consider intrinsic value; such a principle is accounted for in the Endangered Species Act, for example.[18] However, it is much easier to assign value to an obscure endangered animal than it is to assign a specific monetary value to it. In fact, monetary value seems essentially antithetical to the idea of intrinsic value, as it can only quantify how valuable something is to the person spending it. Thus, while each type of value is represented in varying ways in assessing natural resource damages, intrinsic value only gets incidental representation, if at all, for this reason.

The Department of the Interior has promulgated regulations for conducing NRD assessments.[19] If a trustee complies with the Department of the Interior (DOI) Regulations, it is entitled to a rebuttable presumption in its favor in any administrative or judicial proceeding.[20] Though following the regulations is not mandatory, the benefit of the presumption makes the regulations a worthwhile starting point for examining the typical NRDA methodology. The DOI Regulations focus on use value, but there is an opportunity to include non-use values, which encompass existence values but not intrinsic value.[21] The regulations provide for a default methodology and an allowance for alternative methods in the event that a standard method is not appropriate.[22] 

Four Principal CERCLA Methodologies

The default restoration methodology in the DOI Regulations involves replacing the natural resources themselves to reach an equivalent level of natural resource services. The philosophy behind the default restoration methodology is elegantly practical: avoid the problem of valuing natural resources in dollars by assessing restoration costs. For example, instead of valuing injured wetlands, restoration methodology looks at the cost to restore or replace the same wetlands. Under the DOI Regulations, damages for restoration includes the cost necessary to restore the natural resources to the point where they can provide the level of services they provided before the injury or the acquisition new resources that provide the same services.[23] Thus, a monetary value is reached by simply assessing the cost of restoring what was originally there. This method is generally known as “service-to-service scaling.”[24] To be sure, restoring or replacing natural resource services is neither simple nor exact in practice.[25] Restoring natural resources involves inherent and intricate considerations concerning homeostasis and environmental interconnectivity.[26] Furthermore, the baseline that NRDs seek to restore is a naturally dynamic level, which makes the objective a moving target. In theory, however, it is as exact as possible, as it accounts, in definite terms, for a return of precisely what was lost, whether or not such a promise is possible. 

Thus, if the method was exacted perfectly, it would, theoretically, account for the use and existence values, while also incidentally serving intrinsic value to some extent. With the resource’s services restored to their same level before the release of some harmful waste, the use may continue as would normally occur. Similarly, the resource will exist as it did before, so existence value is accounted for. Intrinsic value, however, encounters two issues. Firstly, in cases where replacement is utilized, those who view all life and natural resources as non-fungible might not be satisfied. They might view the practice of replacing natural resources as on par with a parent replacing their child’s dead goldfish with another from the pet store. Even if a supposed equivalent is acquired, it will never truly be the same again. Also, some might be wary of heavy human intervention into complex and interconnected ecosystems, taking the view that once humans have impacted an ecosystem, such damage cannot simply be undone by more human intervention.[27] Therefore, service-to-service scaling, even in theory alone, is not the perfect encapsulation of every value of natural resources; however, it certainly comes the closest of the leading valuation methods.

Service-to-service restoration, though, will not always be the correct solution in every case due to excessive complexity or cost. Thus, the authorized official acting on behalf of the trustee is required to develop a reasonable number of possible valuation alternatives that meet the same need of restoring or replacing the natural resource’s services or acquiring equivalent natural resources.[28] Trustees are free to develop their alternative methods as long as they meet certain factors set out by the DOI.[29] After service-to-service scaling, the three most prominent methodologies are (1) market valuation, (2) behavioral use valuation, and (3) contingent valuation.[30] Such methods are not mutually exclusive, as long as values are not double counted, so trustees are free to carefully combine different methodologies to account for different values.[31] These approaches, however, are primarily monetary, and as such, they begin to extend into abstraction. In departing from the theoretical precision of service-to-service scaling, these methods struggle much more in accurately accounting for each value of the natural resources.

Market valuation is based on an assessment of what the resources would be worth on the free market.[32] In some instances, the court may consult a price list; for example, when valuing certain species of fish, prices can be acquired from commercial hatcheries.[33] Alternatively, courts may account for lost property value.[34] This method is attractive for the practicality of its implementation, as ascertaining market values is simple to execute. It is not always a workable framework, nor is it guaranteed to be inclusive of all the resource’s value, but it provides definite numbers, which are easy to apply. 

Under market valuation, use value would generally be accounted for as long as the payout is put to use in restoring the resource’s services and making them available for use. It is meant to be a metric by which to gauge use in terms of consumption, and it undoubtedly accomplishes this narrow task efficiently, whether or not it does so accurately. Existence value is  generally not reflected. It could theoretically be accounted for insofar as the market reflects willingness to pay for the resource’s value to consumers apart from direct use. Common sense dictates, though, that prices from fish hatcheries or land valuation are surely based on use value, with very little, if any, existence value being accounted for. People are willing to pay for land or fish because they have value insofar as they can come to be owned by them. Thus, a desire to obtain would be more appropriately associated with use value.

Furthermore, intrinsic value, even if it were provided for under the DOI Regulations, could not be included within market value in any meaningful way. A methodology hinging on supply and demand generally would not incorporate intrinsic values, as consumer willingness to spend is often considered to have its foundation in its value to the consumer. Oliver Putnam, who published Sundry Topics of Political Economy in 1834 wrote, “things may possess utility, but unless they are objects of exchange, they have no value.”[35]  If value to the consumer is the only metric, then non-anthropocentric intrinsic value cannot be included. It seems generally unlikely, for example, that consumers would willingly pay more for fish from a hatchery with the thought in their mind that they are somehow better honoring those fishes’ intrinsic value by paying a higher price. Returning to the goldfish analogy, to the proponent of the intrinsic value of natural resources, using market value would be akin to handing the grieving child a $10 bill, the going rate for goldfish at the pet store. Though practical where possible, market valuation can seem rather cold in the way it systematically focuses only on a very basic conception use value.

Behavioral use valuation is similarly focused on use but is based on actual use by people. It is held up as one of the best ways to judge demand for use value.[36] A common form of behavioral use valuation is the estimated costs of what visitors would have spent to use the resource, which is known as “travel cost valuation.”[37] The strength of this method is that it can rely on verifiable behavior in the standard use of the natural resource, but as a result, it only takes into account the resource’s use value.[38] Furthermore, even the use value can be inaccurate, as costs such as travel time are not accounted for.[39] Neither existence value nor intrinsic value can be included for similar reasons to those in market value. By definition, the only metric of the valuation in behavioral use is how much humans use the resource.[40] Thus, for those seeking a repair of non-use value, behavioral use valuation within the goldfish analogy would be akin to the parent asking how much the child truly interacted with his now deceased goldfish and giving him cash proportionally to the time spent with it.

            Perhaps the most controversial example of a restoration alternative is contingent valuation.[41] Contingent valuation works by simply asking people how much a natural resource should cost. Thus, one could conduct a survey and ask a version of the original question posed in this article: “How much would you pay to preserve this river?”[42] Surveys consist of first, a description of the source and method of payment to be used for buying improvements, then questions to gauge the participant’s willingness to pay, and lastly, questions about their demographic characteristics.[43] This method is practically very simple to execute, for you are guaranteed a numerical answer without the need complicated calculations, but the theory behind it is riddled with potential for inaccuracy. The evidentiary rigor of asking simple hypotheticals seems on par with a middle schooler’s game of “would-you-rather.” Answers are guaranteed to be heavily subjective, and even then, studies indicate that such attitudes do not accurately predict behavior.[44] Thus, it could not match the theoretical consistency of service-to-service scaling.

            Yet, for all these critical issues, contingent valuation does have a unique advantage over the other methodologies: it is apparently the only method available to directly quantify non-use values, to the extent that such values can be accounted for within the ambit of CERCLA NRD compensation.[45] The other methods almost certainly do not account for non-use value, and if they do, it is only included incidentally. Contingent valuation, however, allows survey respondents to indicate a value based on their own choice of metric. Thus, if respondents do value a resource beyond what they would pay to use it themselves, they may indicate for themselves how much that value means to them in monetary terms. Furthermore, contingent valuation perhaps comes the closest to being able to include intrinsic value in theory, even if it still does not truly accomplish the task. One who recognizes the intrinsic value of nature could set their personal prices higher than use and existence value to account for it. However, the fact that the DOI regulations do not include intrinsic value within contingent valuation methodology not only hinders such an idea, but also points to an area that may be beyond the reach of the underlying statute.[46] Nonetheless, despite its inconsistent nature, contingent valuation is the best and perhaps only well understood method to explicitly include non-use values within the valuation. 

Observations and Implications from the CERCLA Methodologies

            Three observations emerge from this survey of valuation methodologies. First, each methodology has a varying level of theoretical soundness in assessing damages, from service-to-service scaling at the high end to contingent valuation on the low end. Second, every methodology’s practical accuracy in accounting for resource value is subject to significant questions. The multitude of factors underpinning such a valuation makes it nearly impossible to value natural resources perfectly, not to mention anything of the extent to which such methodologies are sufficient to satisfy a trustee’s evidentiary burden in court. Service-to-service is difficult to implement perfectly; market and behavioral use do not even accurately predict use value; and contingent valuation is, arguably, completely speculative. Third, intrinsic valuation remains unaccounted for across all methodologies, likely by design.

            What do these observations reveal, then, for this relatively narrow but important area of the law? This analysis shows that the DOI regulations contain a significant range of options for valuing natural resources, and these options demonstrate a range of philosophies and preferences concerning natural resource valuation. First, service-to-service scaling is, in theory, a workable default, for it seeks to avoid the problem of abstract monetary valuation. However, the regulations, by including alternatives, acknowledge that this method will not function best in all cases despite its theoretical soundness. Thus, it seems that the regulations are willing to sacrifice theoretical consistency for ease of implementation in some cases. Such ease can, at some point, overcome the practical difficulties with a methodology. 

Also, in terms of alternative methodologies, the regulations do not distinguish between those methods with high or low theoretical consistency as long as they meet the factors listed in the regulations.[47] Perhaps past the most theoretically sound methodology, trustees are allowed their pick to best fit their situation and preferences, though of course to get to restoration, resolution must either be achieved via settlement (i.e., the responsible parties have to agree) or by trial (trustees must bear burden of proof). The mere inclusion of contingent valuation, however, suggests that despite the debate surrounding the method, the DOI deemed that there was a need to account for non-use values through the availability of a discrete methodology. Thus, if trustees so desire, they may opt to try to account for non-use values, with the caveat above that achieving actual restoration with such values explicitly accounted for will turn on either settlement (agreement) or a favorable judgment (meeting evidentiary burden).

            A last important observation is that intrinsic value is entirely omitted from the DOI Regulations. This fact is rather unsurprising since the non-anthropocentric nature of the value makes it nearly impossible to account for from a human perspective. Intrinsic value also seems to go beyond the typical purview of civil claims for damages. However, this omission does mean that if such value of natural resources does exist, it can never be accounted for under the current system. Though the DOI Regulations purport to cover all of a resource’s value, if intrinsic value does exist or is not valued, it risks being lost any time natural resources are injured.

            The NRDA process inherently involves questions about the concept of value itself. The law has risen to meet this challenge with a set of crude but, ultimately, functional methodologies. Indeed, this is not a new challenge for law, which is regularly challenged with ascribing value to such nebulous concepts as pain and suffering and the loss of human life. The willingness to rely on the public either sitting in the jury box in tort claims or responding to contingent valuation surveys for NRDAs could reveal either humility or bewilderment on the part of the legal system. Yet, the very existence of NRDs and acceptance of more abstract methodologies shows willingness to try to value nature fully. Even if the numbers will not always square with a metaphysical value of each resource, the law seems to aim for taking as many steps toward restoration of the resources in public trust as possible. Perhaps the state of the law, policy, and practice of NRD is not yet enough to fully value nature, not only for its services to humanity, but in and of itself; hopefully, though, as humanity’s understanding of the natural environment ever grows, so too will the number of those steps taken towards conceptualizing and recognizing the full value of the natural world.


            Christian Green is a 2L from Brownsville, Texas. He attended the University of Notre Dame and joined TELJ during his first year of law school. Christian has long been interested in the field of environmental law and will be interning with the Texas Commission on Environmental Quality during the summer of 2022.


            Amanda Halter is managing partner of the Houston office of the international law firm of Pillsbury Winthrop Shaw Pittman, a member of the firm’s Environmental & Natural Resources practice section and co-leader of the firm’s Crisis Management team. Amanda helps companies resolve environmental liabilities and negotiate compliance conditions, as well as manage financial and reputational losses associated with a crisis. Her experience includes a diverse array of environmental regulatory, litigation and crisis matters, including contamination investigations and remedial actions, natural resource damages assessments and claims, environment, health and safety compliance counseling, mass toxic tort actions, permitting and planning for large-scale industrial projects, and project impacts mitigation and restoration strategies. Amanda is a native of Houston, a gr


[1] Natural Resource Damages: A Primer, U. S. Env’t Prot. Agency (last visited Oct. 26, 2021), https://www.epa.gov/superfund/natural-resource-damages-primer [hereinafter EPA Primer].

[2] 42 U.S.C. § 9607(a)(4)(c).

[3] 42 U.S.C. § 9601(16).

[4] EPA Primer

[5] Id.


[7] Frank B. Cross, Natural Resource Damage Valuation, 42 Vand. L. Rev. 269, 280–81 (1989) [hereinafter Natural Resource Damage Valuation].

[8] Id.

[9] Id. at 285. 

[10] Id.

[11] Id. at 292-93

[12] Natural Resource Damage Valuation, supra note 7, at 293. 

[13] See Id. at 281–83

[14] Id. at 286.

[15] See Id. at 289.

[16] See Id. at 292.

[17] See Id. at 292–94.

[18] See Zygmunt J.B. Plater, In the Wake of the Snail Darter: An Environmental Law Paradigm and its Consequences, 19 U. Mich. J.L. Reform 805, 824–25 (1986).

[19] 43 C.F.R.§ 11 (2008) [hereinafter DOI Regulations].

[20] 42 U.S.C. § 9607(f)(2)(C) (2018).

[21] 43 C.F.R. § 11.83(c)(1) (2008).

[22] 43 C.F.R. § 11.82 (2008).  


[23] 43 C.F.R. § 11.80(b) (2008).

[24] Habitat Equivalency Analysis, NOAA (last visited Oct. 30, 2021) https://darrp.noaa.gov/economics/habitat-equivalency-analysis.

[25] Natural Resource Damage Valuation, supra note 7, at 4332–33

[26] Id.

[27] See Id. at 333–34.

[28] 43 C.F.R. § 11.82(a) (2008).

[29] 43 C.F.R. § 11.82(d) (2008).

[30] Natural Resource Damage Valuation, supra note 7, at 297–98; see C.F.R. § 11.83(c)(2) (2008).

[31] 43 C.F.R. § 11.83(c)(2) (2008).

[32] Natural Resource Damage Valuation, supra, note 7, at 302.

[33] Id.

[34] Id.

[35] George M. Armstrong, Jr., From the Fetishism of Commodities to the Regulated Market: The Rise and Decline of Property, 82 Nw. U.L. Rev. 79, 91 (1987).

[36] Patrick H. Zaepfel, The Reauthorization of CERCLA NRDs: A Proposal for a Reformulated and Rational Federal Program, 8 Vill. Env’t. L.J. 359, 396 (1997).

[37] Id.

[38] Id.

[39] Id.

[40] See Natural Resource Damage Valuation, supra note 7, at 312–13.

[41] Miriam Montesinos, It May Be Silly, But It’s An Answer: The Need To Accept Contingent Valuation Methodology In Natural Resource Damage Assessments, 26 Ecology L.Q. 48, 52–53 (1999) [hereinafter The Need to Accept Contingent Valuation].

[42] See Natural Resource Damage Valuation, supra note 7. at 315.

[43] The Need to Accept Contingent Valuation, supra note 41, at 52–52.

[44] See Natural Resource Damage Valuation, supra note 7, at at 315.

[45] The Need to Accept Contingent Valuation, supra note 41, at 50–51.

[46] See 43 C.F.R. § 11.83(c)(2)(vii) (2008).

[47] 43 C.F.R. § 11.83(a)(4) (2008).

Vol. 52-1 Water Quality

Water Quality


Recission of Guidance Memorandum on County of Maui, Hawaii v. Hawaii Wildlife Fund



The Clean Water Act (“CWA”)[1] establishes the statutory structure for regulating the discharge of pollutants to the waters of the United States and setting surface water quality standards.[2] The National Pollutant Discharge Elimination System (“NPDES”)[3] permit program, created by the CWA in 1972, addresses water pollution by regulating point sources that discharge pollutants to the waters of the United States.[4] Under the program, the discharge of pollutants from a point source into a water of the United States is unlawful and prohibited unless an NPDES permit is authorized.[5]

Typically, an NPDES permit will specify an acceptable level of a pollutant or pollutant parameter in a discharge.[6] The decision whether to seek and obtain NPDES permit coverage resides with the owners or operators of facilities or systems; however, the failure to obtain coverage prior to a discharge exposes the owner or operator to potential civil or criminal enforcement and court orders mandating compliance with CWA permitting requirements.[7] 


County of Maui, Hawaii v. Hawaii Wildlife Fund

Until 2020, federal courts were divided on the question of whether a discharge of a pollutant subject to the CWA occurs when a pollutant is released from a point source and subsequently moves through groundwater, a nonpoint source,[8] before reaching a navigable water in the United States.[9] In other words, the issue was whether a CWA NPDES permit may be required for releases of pollutants from a point source that reach a jurisdictional water through groundwater.[10] 

In 2012, several environmental groups brought action against the County of Maui alleging that the county violated the CWA by discharging a pollutant to navigable waters without the required NPDES permit.[11] The county’s wastewater reclamation facility pumped treated sewage water into the ground through wells from which effluent traveled through groundwater to the Pacific Ocean.[12] The district court found that the county’s actions required an NPDES permit, since the pollution’s “path to the ocean is clearly ascertainable” from Maui’s wells into groundwater and to the ocean.[13] The Ninth Circuit court affirmed the decision on February 1, 2018, stating that pollutants coming from the wells were “fairly traceable from the point source to a navigable water” and that the CWA “does not require the point source itself convey the pollutants directly into the navigable water.”[14] 

In 2018, the County of Maui petitioned the U.S. Supreme Court for certiorari review, which was granted.[15] During oral arguments before the Court in November 2019, an attorney with the U.S. Department of Justice argued based on the Environmental Protection Agency’s (EPA) “Interpretive Statement on Application of the Clean Water Act National Pollutant Discharge Elimination System Program to Release of Pollutants From a Point Source to Groundwater” that “all releases of pollutants to groundwater” are excluded from the scope of the permitting program, “even where pollutants are conveyed to jurisdictional surface waters via groundwater.”[16] The Court rejected the interpretation the EPA articulated in the statement and delivered an opinion on this issue in County of Maui, Hawaii v. Hawaii Wildlife Fund.[17]

In its April 2020 decision, the Court explicitly rejected the Ninth Circuit court’s overly broad “fairly traceable test,” and held that an NPDES permit is required for a discharge of pollutants from a point source that reaches navigable waters after traveling through groundwater either when there is a direct discharge from a point source into navigable waters, or “if the addition of the pollutants through groundwater is the functional equivalent of a direct discharge from the point source into navigable waters.”[18] In other words, County of Maui clarified that an NPDES permit is required for a subset of discharges of pollutants that reach a water of the United States through groundwater—those that are the “functional equivalent” of direct discharges to jurisdictional waters.[19] 

The Court’s opinion cited seven factors to consider when determining whether an indirect discharge will require NPDES coverage because it is “functionally equivalent” to a direct discharge, including: (1) the transit time of a pollutant to a navigable water, (2) the distance a pollutant travelled to a navigable water, (3) the nature of the material through which the pollutant travels, (4) the extent to which the pollutant is diluted or chemically changed as it travels, (5) the amount of pollutant entering the navigable water relative to the amount of the pollutant leaves the point source and is discharged into groundwater, (6) the manner by or area in which the pollutant enters the navigable water, and (7) the degree to which the pollutant at that point has maintained its specific identity when it reaches the navigable water.”[20] 


Guidance Memorandum

Following the Court’s decision, the EPA issued a guidance document near the end of President Trump’s administration on January 14, 2021, entitled “Applying the Supreme Court’s County of Maui v. Hawaii Wildlife Fund Decision in the Clean Water Act Section 402 National Pollutant Discharge Elimination System Permit Program,” which explained how to apply the Court’s decision.[21] The guidance only addressed discharges of pollutants that reach waters of the United States through groundwater and clarified the CWA permitting requirements for the indirect water pollution on a case by case basis.[22] The previous administration’s guidance placed the “functional equivalent” analysis into context within the existing NPDES permitting framework and identified an additional factor for authorities to consider when evaluating whether and how to perform a “functional equivalent” analysis: “the design and performance of the system or facility from which the pollutant is released.”[23] 

The EPA derived this additional factor from the NPDES permit application forms that contain inquiries concerning design and performance that are routinely considered by permitting authorities in the administration of the NPDES permit program.[24] EPA interpreted language in County of Maui to support the idea that the composition and concentration of discharges of pollutants directly from a pipe or other discernible, confined, and discrete conveyance into a water of the United States with little or no intervening treatment or attenuation often differed significantly from the composition and concentration of discharges of pollutants into a system that is engineered, designed, and operated to treat or attenuate pollutants or uses the surface or subsurface to treat, provide uptake of, or retain pollutants.[25] 

The addition of this factor skewed the “functional equivalent” analysis in a way that could reduce the number of discharges requiring a NPDES permit, thereby diminishing clean water protections.[26] Under the guidance, EPA decided that facilities were less likely to be the “functional equivalent” of a direct discharge for the following reasons: if they are designed and perform with a storage, treatment or containment system such as a septic system, cesspool or settling pond, if they are operating as a runoff management system, such as with stormwater controls, infiltration or evaporation systems or other green infrastructure, or if they operate water reuse, recycling or groundwater recharge facilities.[27] In other words, this means a release is less likely to be the “functional equivalent” of a discharge if it came from a facility or system that was designed not to release pollutants, but to store, contain, or treat them.[28]

Ultimately, under the guidance, if a system was designed to avoid discharges, and generally did so, that would weigh against a CWA violation even if there were some leaks into groundwater that eventually connected with a jurisdictional water.[29] Thus, the guidance had been derided by environmental organizations as creating loopholes for dischargers to evade CWA permitting requirements.[30]


Recission of Guidance Memorandum 

Upon taking office, President Biden signed Executive Order 13990 titled, “Executive Order on Protecting Public Health and the Environment and Restoring Science to Tackle the Climate Crisis,” directing the EPA to “immediately review all existing regulations, orders, guidance documents, policies, and any other similar agency actions” of the previous administration and to suspend, revise, or rescind those agency actions that “do not protect our public health and the environment.”[31] Although a guidance document does not have the force and effect of law and does not bind the public in any way, through the issuance of one, the EPA intends to provide clarity to the public regarding existing requirements under the law or EPA policies.[32] Pursuant to this Executive Order, EPA conducted a review of the County of Maui guidance document.[33] 

After reviewing the guidance document, EPA’s Office of Water issued a memorandum rescinding the guidance document on September 15, 2021, which was sent to the EPA Regions and Water Division Directors.[34] The EPA explained that in addition to the input from the agency workgroup established to evaluate the guidance, the decision to rescind the guidance was informed by meetings with a broad range of stakeholders, who found that the guidance was inconsistent with EPA’s authority to limit pollution discharges to jurisdictional waters.[35] With this action, EPA is preserving longstanding clean water protections.[36]

The document was rescinded for two primary reasons—substantive flaws and the lack of sufficient interagency consideration.[37] First, the agency is rescinding the guidance based on determining that the additional “design and performance” factor, is inconsistent with the CWA and the Supreme Court decision in County of Maui, because “the additional factor introduces an element of intent that is not reflected in or consistent with the County of Maui decision.” [38] Second, “the guidance was issued without proper deliberation within EPA or with [their] federal partners.”[39]

The withdrawal will likely expand the number of discharges to groundwater that EPA finds are the “functional equivalent of a direct discharge from a point source into navigable waters” and therefore require a CWA permit.[40] The implication for rescinding this guidance document is that even if some design facilities or wastewater systems to avoid discharges, they still could face CWA liability for even small leaks of pollutants into groundwater that eventually connects to a navigable water.[41] The EPA’s Press Office issued a news release in which it indicated that the CWA and a straightforward application of the Supreme Court’s decision provide important protections for the nation’s water by ensuring that discharges of pollutants to groundwater that reach surface waters are appropriately regulated.[42] This action will help protect water quality in lakes, streams, wetlands, and other waterbodies.[43] 

The EPA also reiterated its position that the focus of the Court’s decision in County of Maui is on whether a permit is required to protect surface waters, and not to protect or regulate groundwater itself. [44] Therefore, the existence of a state groundwater protection program that may regulate a discharge does not obviate the need for NPDES permitting authorities to apply the “functional equivalent” factors that the Supreme Court identified in determining whether a discharge from a point source through groundwater that reaches jurisdictional surface water requires an NPDES permit.[45] Such language appears to be intended to address claims made by industry on-going litigation that discharges subject to regulation under state groundwater programs categorically that do not require NPDES permit.[46] Although the analysis will not extend to the state groundwater protection programs for this reason, the recission ultimately indicates that the new administration will take a broader view than the prior administration as to when discharges into groundwater are the “functional equivalent” of a discharge directly into a navigable water.[47]



The EPA stated that it is “evaluating appropriate next steps to follow the recission” of the guidance.[48] In the interim, consistent with past practice and informed by the guiding principles and factors specified by the Supreme Court in County of Maui, EPA will continue to apply site-specific, science-based evaluations to determine whether a discharge from a point source through groundwater that reaches jurisdictional surface water is a “functional equivalent” of a direct discharge and therefore requires a permit under the CWA.[49] Moreover, for the time being, it will continue to make NPDES determinations on a case-by-case basis, which had long been agency practice prior to the issuance of the County of Maui decision.[50] EPA is committed to working with its state co-regulators, Tribes, and local partners to better protect water quality that is essential to public health and thriving ecosystems.[51]


Niha Ali is a 3L at Texas Law and has been a part of TELJ since the Fall of 2019. She grew up in Katy, Texas and completed her undergraduate education in Philosophy with a Business minor at the University of Texas at Austin.


David Klein is a Principal of Lloyd Gosselink Rochelle & Townsend, P.C. and is the Chair of the Environmental and Natural Resources Law Section of the State Bar of Texas.  David represents public and private clients in water quality, water rights, water districts, and water utility service matters.


[1] 33 U.S.C. §§ 1251–1387 (1972).

[2] Summary of the Clean Water Act, U.S. Env’t. Prot. Agency, https://www.epa.gov/laws-regulations/summary-clean-water-act (last updated Oct. 22, 2021). 

[3] 33 U.S.C. § 1342 (1972).

[4] About NPDES, U.S. Env’t. Prot. Agency, https://www.epa.gov/npdes/about-npdes (last updated May 28, 2021).

[5] NPDES Permit Basics, U.S. Env’t. Prot. Agency, https://www.epa.gov/npdes/npdes-permit-basics (last updated Sept. 28, 2021).

[6] Id.

[7] Id.

[8] Basic Information about Nonpoint Source (NPS) Pollution, U.S. Env’t. Prot. Agency, https://www.epa.gov/nps/basic-information-about-nonpoint-source-nps-pollution (last updated July 08, 2021).

[9] See Hawaii Wildlife Fund v. Cnty. of Maui, 886 F.3d 737 (9th Cir. 2018) (discharges through groundwater are subject to CWA permitting where they are fairly traceable to the point source and more than de minimis); See also Upstate Forever v. Kinder Morgan Energy Partners, 887 F. 3d 637 (4th Cir. 2018) (discharges must have a direct hydrological connection between ground water and navigable waters to state a claim under CWA); See also Ky. Waterways All. v. Ky. Util. Co., 905 F.3d 925, 940 (6th Cir. 2018) (discharges through groundwater are excluded from the CWA’s permitting requirements).

[10] Cnty. of Maui, Hawaii v. Hawaii Wildlife Fund, 140 S. Ct. 1462, 1469 (2020).

[11] Id. at 1469.

[12] Id. at 1465, 1469.

[13] Hawaii Wildlife Fund v. Cty. of Maui, Hawaii, 24 F.Supp.3d 980, 998 (D. Haw. 2014).

[14] Hawaii Wildlife Fund v. Cty. of Maui, Hawaii, 886 F.3d 737, 749 (9th Cir. 2018) (emphasis added).

[15] Cnty. of Maui, 140 S. Ct. at 1469–1470.

[16] 84 Fed. Reg. 16,810, 16,811 (Apr. 23, 2019) (emphasis added).

[17] Cnty. of Maui, 140 S. Ct. at 1465, 1473–1475.

[18] Id. at 1468, 1470, 1476–77 (emphasis added).

[19] Id. at 1468, 1477.

[20] Id. at 1476–77.

[21] 86 Fed. Reg. 6, 321 (Jan. 21, 2021).

[22] Id.

[23] Id.

[24] Id. See e.g., 40 C.F.R. 122.21; NPDES Applications and Forms–EPA Applications, U.S. Env’t. Prot. Agency, https://www.epa.gov/npdes/npdes-application-forms (last updated Apr. 27, 2021).

[25] 86 Fed. Reg. 6,321 (Jan. 21, 2021); Cty. of Maui, 140 S. Ct. at 1476 (“[w]hether pollutants that arrive at navigable waters after traveling though groundwater are ‘from’ a point source depends upon how similar to (or different from) the particular discharge is to a direct discharge”).

[26] 86 Fed. Reg. 6,321 (Jan. 21, 2021).

[27] Id.

[28] Id.

[29] 86 Fed. Reg. 53,653 (Sept. 28, 2021).

[30] EPA Rescinds Maui Guidance, Raises New Questions on NPDES Implementation, Nat’l Ass’n of Clean Water   Agencies (Sept. 22, 2021), https://www.nacwa.org/news-publications/clean-water-current-archives/clean-water-current/2021/09/22/epa-rescinds-maui-guidance-raises-new-questions-on-npdes-implementation [hereinafter NACWA]

[31] Exec. Order 13,990, 86 Fed. Reg. 7,037 (Jan. 25, 2021).

[32] EPA Guidance Documents, U.S. Env’t. Prot. Agency, https://www.epa.gov/guidance (last updated May 11, 2021).

[33] 86 Fed. Reg. 6, 321 (Jan. 21, 2021). 

[34] 86 Fed. Reg. 53,653 (Sept. 28, 2021).

[35] Id.; U.S. EPA Press Office, EPA Rescinds Previous Administration’s Guidance on Clean Water Act Permit Requirements, U.S. Env’t. Prot. Agency (Sept. 16, 2021), https://www.epa.gov/newsreleases/epa-rescinds-previous-administrations-guidance-clean-water-act-permit-requirements.

[36] Id

[37] 86 Fed. Reg. 53,653 (Sept. 28, 2021).

[38] Id.

[39] Id.

[40] EPA Withdraws Trump-era Guidance on When Groundwater Releases Require Clean Water Act Permits, J.D. Supra (Sept. 20, 2021), https://www.jdsupra.com/legalnews/epa-withdraws-trump-era-guidance-on-3442536/

[41] Todd Neely, EPA Rescinds CWA Groundwater Guidance, DTN (Sept. 24, 2021), https://www.dtnpf.com/agriculture/web/ag/news/world-policy/article/2021/09/24/epa-action-groundwater-guidance-act.

[42] U.S. EPA Press Office, supra note 35.

[43] Id.

[44] 86 Fed. Reg. 53,653 (Sept. 28, 2021).

[45] Id.

[46] NACWA, supra note 30.

[47] Neely, supra note 41.

[48] 86 Fed. Reg. 53,653 (Sept. 28, 2021).

[49] Id.

[50] Cnty. of Maui, 140 S. Ct. at 1465.

[51] 86 Fed. Reg. 53,653 (Sept. 28, 2021).