Law Commons^™

Defrosting Regulatory Chill, Guillermo J. Garcia Sanchez

Faculty Scholarship

In Homer’s Odyssey, King Odysseus asked his men to tie him to the mast of his ship with the hope that he would not jump into the sea after listening to the Sirens. The Odyssey’s hero made a pact to bind himself in the future. He knew that the temptation would be impossible to resist without restraints. Similarly, the creators and advocates of international investment agreements believe that providing rights to foreign investors through international treaties will chill State policies that would harm the interests of investors in the future. The “rope” to tie the State is the threat of …

North American Energy In The Crossfire, Guillermo J. Garcia Sanchez, James W. Coleman

Faculty Scholarship

North America is the beating heart of global energy markets un-dergoing a terrible energy crisis that threatens to upend both the economy and global security. The clearest path out of this global crisis is increasing energy supplies from North America, which can restore energy security and drive a transition to cleaner energy sources. The U.S., Mexico, and Canada have abundant and varied resources to surmount this challenge but are in dire need of stronger cooperation across borders, and between private and public actors to achieve this goal. This Article shows how energy law changes in the U.S. and Mexico present …

Virtual Energy, Joel B. Eisen, Felix Mormann, Heather E. Payne

Faculty Scholarship

From employment to education, many areas of our daily lives have gone virtual, including the virtual workplace and virtual classes. By comparison, the way we generate, deliver, and consume electricity is an anachronism. And the electric industry’s outdated business model and regulatory framework are failing. For the last century-and-a-half, we have relied on ever larger power plants to generate the electricity we consume, often hundreds of miles away from the point of production. But the outsized carbon footprint of these power plants and the need to transmit their output over long distances threaten the electric grid’s reliability, affordability, and long-term …

Reclaiming Regulatory Intermediation For The Public, Daniel E. Walters

Faculty Scholarship

Managerial governance is often operationalized through outsourcing the regulatory function from public institutions—for example, administrative agencies—to private organizations. In virtually any sector, it is possible to identify private “regulatory intermediaries” that step between public agencies and regulated parties to perform tasks traditionally played by government actors—for example, the development of regulatory standards, auditing, compliance assurance, enforcement, and more. Although this reliance on private regulatory intermediaries may in some cases be highly advantageous to government institutions since it may sometimes allow government agencies to do more regulatory work than their own resources and capacity might allow—it comes at significant costs of …

Grid Governance In The Energy-Trilemma Era: Remedying The Democracy Deficit, Daniel E. Walters, Andrew N. Kleit

Faculty Scholarship

Transforming the electric power grid is central to any viable scenario for addressing global climate change, but the process and politics of this transformation are complex. The desire to transform the grid creates an “energy trilemma” involving often conflicting desires for reliability, cost, and decarbonization; and, at least in the short run, it is difficult to avoid making tradeoffs between these different goals. It is somewhat shocking, then, that many crucial decisions about electric power service in the United States are made not by consumers or their utilities, nor by state public utilities commissions or federal regulators. Instead, for much …

Keeping All The Lights On: A Roadmap To Affordable, Universal Electricity Service In The Clean Energy Transition, Gabriel Pacyniak

Faculty Scholarship

The COVID-19 pandemic, the ongoing reckoning with structural racism, and an emerging focus on justice in the clean energy transition have combined to spotlight utility disconnections and the related issues of energy access, affordability, and security. Recent empirical scholarship has demonstrated that electricity disconnections of lower-income people are relatively common, disproportionately affect people of color, and cause significant harm. This Article describes how a number of U.S. states are fashioning an emerging policy model that makes significant progress toward truly affordable and accessible electricity service for all. It also describes how these state actions are consistent with U.S. utility law …

The Case Against Regional Transmission Monopolies, Kristen Van De Biezendos

Faculty Scholarship

Over the next decade, the United States will need to build significant regional transmission infrastructure to achieve the country’s goal of net-zero power by 2035. However, there is a significant barrier: the transmission system is almost entirely owned by private monopolies. As a result, the grid has grown not to serve the public interest but in accordance with the economic priorities of these monopolies, which are not incentivized to innovate, find efficiencies, or lower costs. Past attempts to encourage competitive bidding for regional transmission projects have been stymied by laws intended to protect the monopolies, including the right of first …

Climate Choice Architecture, Felix Mormann

Faculty Scholarship

Personal choices drive global warming nearly as much as institutional decisions. Yet, policymakers overwhelmingly target large-scale industrial facilities for reductions in carbon emissions, with individual and household emissions a mere afterthought. Recent advances in behavioral economics, cognitive psychology, and related fields have produced a veritable behavior change revolution. Subtle changes to the choice environment, or nudges, have improved stake-holder decision-making in a wide range of contexts, from healthier food choices to better retirement planning. But the vast potential of choice architecture remains largely untapped for purposes of climate policy and action. This Article explores that untapped potential and makes the …

In The Name Of Energy Sovereignty, Guillermo J. Garcia Sanchez

Faculty Scholarship

Throughout history, the phrase "In the name of the King" justified actions that trumped the rights of citizens in order to safeguard the interests of the Crown. Today, in the name of energy sovereignty, states deploy the government apparatus to access oil and gas in other parts of the world, build pipelines on private lands, subsidize renewable energy, and nationalize their oil and power industries. States justify each of these actions by noting that they create a sense of energy independence, ensure security, or achieve other social and economic goals. Energy, however, cannot be trapped in one "realm." Its nature …

Characterizing Legal Implications For The Use Of Transboundary Aquifers, Gabriel Eckstein

Faculty Scholarship

Groundwater resources that traverse political boundaries are becoming increasingly important sources of freshwater in international and intranational arenas worldwide. This is a direct extension of the growing need for new sources of freshwater, as well as the impact that excessive extraction, pollution, climate change, and other anthropogenic activities have had on surface waters. It is also a function of the growing realization that groundwater respects no political boundaries, and that aquifers traverse jurisdictional lines at all levels of political geography.

Due to this growing awareness, questions pertaining to responsibility and liability are now being raised in relation to the use, …

Lumpy Social Goods In Energy Decarbonization: Why We Need More Than Just Markets For The Clean Energy Transition, Daniel E. Walters

Faculty Scholarship

To avoid the worst consequences of global climate change, the United States must achieve daunting targets for decarbonizing its electric power sector on a very short timescale. Policy experts largely agree that achieving these goals will require massive investment in new infrastructure to facilitate the deep integration of renewable fuels into the electric grid, including a new national high-voltage electric transmission network and grid-scale electricity storage, such as batteries. However, spurring investment in these needed infrastructures has proven to be challenging, despite numerous attempts by regulators and policymakers to clear a path for market-driven investment. Unchecked, this problem threatens to …

The Case For Corporate Climate Ratings: Nudging Financial Markets, Felix Mormann, Milica Mormann

Faculty Scholarship

Capital markets are cast as both villain and hero in the climate playbill. The trillions of dollars required to combat climate change leave ample room for heroics from the financial sector. For the time being, however, capital continues to flow readily toward fossil fuels and other carbon-intensive industries. Drawing on the results of an empirical study, this Article posits that ratings of corporate climate risk and governance can help overcome pervasive information asymmetries and nudge investors toward more climate-conscious investment choices with welfare-enhancing effects.

In the absence of a meaningful price on carbon, three private ordering initiatives are trying to …

When Drills And Pipelines Cross Indigenous Lands In The Americas, Guillermo J. Garcia Sanchez

Faculty Scholarship

From the Missouri River, passing through the Sonora Desert, all the way down to the Amazon Forest and the Andean Mountains, drills and pipelines are crossing over indigenous lands. In an energy-thirsty continent, there is no land left to spare, not even tribal land. Many of these energy infrastructure projects involve international investments that are protected by treaties and enforced by arbitral tribunals. At the same time, tribal communities have an internationally recognized right to receive prior and informed consultation before they are affected by projects of this nature. The Article focuses on the clash of rights between energy extraction …

Presidential Progress On Climate Change: Will The Courts Interfere With What Needs To Be Done To Save Our Planet?, Michael B. Gerrard

Faculty Scholarship

The Biden Administration is undertaking numerous actions to reduce greenhouse gas emissions and transition away from fossil fuels as part of the fight against climate change. Many of these actions are likely to be challenged in court. This paper describes the various legal theories that are likely to be used in these challenges, assesses their prospects of success given the current composition of the Supreme Court, and suggests ways to minimize the risks.

Whither The Regulatory "War On Coal"? Scapegoats, Saviors, And Stock Market Reactions, Cary Coglianese, Daniel E. Walters

Faculty Scholarship

Complaints about excessive economic burdens associated with regulation abound in contemporary political and legal rhetoric. In recent years, perhaps nowhere have these complaints been heard as loudly as in the context of U.S. regulations targeting the use of coal to supply power to the nation’s electricity system, as production levels in the coal industry dropped by nearly half between 2008 and 2016. The coal industry and its political supporters, including the president of the United States, have argued that a suite of air pollution regulations imposed by the U.S. Environmental Protection Agency during the Obama administration seriously undermined coal companies’ …

Litigating Epa Rules: A Fifty-Year Retrospective Of Environmental Rulemaking In The Courts, Cary Coglianese, Daniel E. Walters

Faculty Scholarship

No abstract provided.

Irena At 10: Post Paris Transitions And Energy Diplomacy Beyond Opec, The Energy Charter Treaty, And The Coronavirus, Nadia B. Ahmad

Faculty Scholarship

No abstract provided.

Greening The Old New Deal: Strengthening Rural Electric Cooperative Supports And Oversight To Combat Climate Change, Gabriel Pacyniak

Faculty Scholarship

New Deal cooperatives succeeded in electrifying rural America when for-profit utilities would not. Today, however, rural electric cooperatives are lagging behind when it comes to meeting the challenge of climate change. Cooperatives have collectively been slower to embrace the shift to low-carbon electricity than for-profit and municipal utilities and have served as a drag on state and federal clean energy and climate policies. This is partially because of the structural differences between cooperatives and other utilities, but also because of a weak and under-determined federal and state regulatory structure. A few cooperatives in Colorado and New Mexico are seeking to …

Clean Energy Equity, Felix Mormann

Faculty Scholarship

Solar, wind, and other clean, renewable sources of energy promise to mitigate climate change, enhance energy security, and foster economic growth. But many of the policies in place to promote clean energy today are marred by an uneven distribution of economic opportunities and associated financial burdens. Tax incentives for renewables cost American taxpayers billions of dollars every year, yet the tax code effectively precludes all but the largest banks and most profitable corporations from reaping the benefits of these tax breaks. Other policies, such as renewable portfolio standards that set minimum quota to create demand for renewable electricity require such …

Market Segmentation Vs. Subsidization: Clean Energy Credits And The Commerce Clause's Economic Wisdom, Felix Mormann

Faculty Scholarship

The dormant Commerce Clause has long been a thorn in the side of state policymakers. The latest battleground for the clash between federal courts and state legislatures is energy policy. In the absence of a decisive federal policy response to climate change, nearly thirty states have created a new type of securities—clean energy credits—to promote lowcarbon renewable and nuclear power. As more and more of these programs come under attack for alleged violations of the dormant Commerce Clause, this Article explores the constitutional constraints on clean energy credit policies. Careful analysis of recent and ongoing litigation reveals the need for …

The Fine Print Of The Mexican Energy Reform, Guillermo J. Garcia Sanchez

Faculty Scholarship

Five years ago, when Mexico transformed its energy sector, most commentators were worried about the government’s capacity to implement the reform. What would the upstream contracts look like? Would the auctions be transparent? How would international companies react? After two successful auction rounds, 107 signed contracts, and the creation of viable regulatory agencies to manage and monitor the reform agenda, the questions have changed. Today, Mexico’s capacity to implement energy reforms and attract foreign investment is no longer in doubt. Today, the most pressing questions about the reform concern its long-term sustainability. Can it survive the Mexican electoral cycles? Will …

Can Clean Energy Policy Promote Environmental, Economic, And Social Sustainability?, Felix Mormann

Faculty Scholarship

Two and a half decades of clean energy policymaking focused primarily on environmental and economic sustainability have yielded considerable environmental and economic benefits. Along the way, however, other policy considerations, such as the social sustainability of the transition to a cleaner, renewably fueled energy economy, have gone largely overlooked. As clean energy technologies continue to gain ever-greater traction in the United States and global energy economies, the social impacts of their enabling policies become more and more salient. Already, ratepayers, taxpayers, and other stakeholders who fear being left behind by the clean energy transition question the “fairness” of today’s renewable …

The Incomplete Ecology Of Hydraulic Fracturing Governance, Gregg P. Macey

Faculty Scholarship

No abstract provided.

Mexico's Energy Reform And The 2012 U.S.-Mexico Transboundary Agreement. An Opportunity For Efficient, Effective And Safe Exploitation Of The Gulf Of Mexico, Guillermo J. Garcia Sanchez

Faculty Scholarship

Nature knows no legal boundaries. Resources cannot be stopped by walls with barbwire; no matter how high some people want to build them. They cross- national territories and expand under their logic. They belong to many nations, and they are there for the responsible exploitation of their communities. The Gulf of Mexico (Gulf) and its rich hydrocarbon deposits are no exceptions. The implication of this is that for the development of this enclosed sea area to be efficient, effective, and safe it requires not only the cooperation of government officials but also the inclusion of other actors, such as academic …

Free Trade In Electric Power, Joel B. Eisen, Felix Mormann

Faculty Scholarship

This Article develops the core legal framework of a new electricity-trading ecosystem in which anyone, anytime, anywhere, can trade electricity in any amount with anyone else. The proliferation of solar and other distributed energy resources, business model innovation in the sharing economy, and climate change present enormous challenges — and opportunities — for America’s energy economy. But the electricity industry is ill equipped to adapt to and benefit from these transformative forces, with much of its physical infrastructure, regulatory institutions, and business models a relic of the early days of electrification. We suggest a systematic rethinking to usher in a …

Regulatory Cooperation In International Trade And Its Transformative Effects On Executive Power, Elizabeth Trujillo

Faculty Scholarship

As international trade receives the brunt of local discontent with globalization trends and recent changes by the Trump administration have put into question the viability of such trade arrangements moving forward, there has been a clear trend in using international trade fora for managing regulatory barriers on economic development. This paper will discuss this recent trend in international trade toward increased regulatory cooperation through the creation of formalized transnational regulatory bodies, such as the U.S.-EU Regulatory Cooperation Body that was being discussed in the TTIP negotiations and comparable ones in the Canadian-EU Trade Agreement as well as U.S.-Mexico and U.S.- …

Voter Psychology And The Carbon Tax, Gary M. Lucas Jr

Faculty Scholarship

Economists across the political spectrum argue that a carbon tax is the most effective and economically efficient policy for addressing climate change. Voters, however, strongly oppose the carbon tax and instead favor “green” subsidies and command-and-control regulations. If carefully designed, these policies might complement a carbon tax, but by themselves, they will make global warming mitigation incredibly expensive and perhaps even infeasible. Moreover, if poorly designed, subsidies and regulations can be counterproductive.

This Article argues that the public dislikes the carbon tax because the tax possesses attributes that make it psychologically unappealing relative to other climate policy instruments. The Article …

Blood Biofuels, Nadia B. Ahmad

Faculty Scholarship

No abstract provided.

Trust Or Bust: Complications With Tribal Trust Obligations And Environmental Sovereignty, Nadia B. Ahmad

Faculty Scholarship

No abstract provided.

Energy Subsidies: Worthy Goals, Competing Priorities, And Flawed Institutional Design, David M. Schizer

Faculty Scholarship

The United States uses on targeted subsidies for both "green" energy and hydrocarbons. These subsidies pursue worthwhile goals. But unfortunately, many have design flaws that make them less effective or even counterproductive. The goal of this Article is to show how to do better.

Specifically, this Article focuses on three sets of issues. First, there often is tension between our environmental and national security goals. Unfortunately, the economics literature on energy largely ignores these trade-offs by omitting national security from the analysis. This Article takes issue with this approach and suggests ways to manage these trade-offs. Second, this Article argues …