In the wake of climate change, how will force majeure provisions in Environmental Protection Agency (EPA) consent decrees (CDs) account for the increasing frequency of climate events? This issue (the Force Majeure Problem) may arise due to the increasing frequency of both severe climate events and applications by regulated entities for force majeure status.
Consider a hypothetical scenario in which PlateCo, a potentially responsible party (PRP) at a Superfund site, owns a facility located along the Mississippi River close to the Gulf of Mexico. PlateCo is undertaking cleanup efforts at the site pursuant to an EPA CD. A Category 5 hurricane, the likes of which has not been seen in a half century, then rips through the Gulf of Mexico. The PlateCo facility is destroyed—in part because of a lack of mitigating precautions being taken. The hexavalent chromium stored in the facility spills into the Mississippi River, preventing PlateCo from meeting the remedial schedule set forth in the record of decision and incorporated in the CD.
EPA reactively steps in to prevent further harm to human health or the environment but cannot prevent many who live in the region from ingesting the contaminated water. While EPA’s efforts are important in remedying the consequences of the accident, many people in the region will be diagnosed with cancer some years later.
Amidst EPA’s cleanup efforts, scientists across multiple agencies and research institutions conclude that this seemingly abnormal hurricane is not so exceptional when viewed in the context of human impacts on the global climate. PlateCO was on notice that their anti-hurricane and flooding infrastructure needed improvement; 20 years of climate data should make anyone aware of their climate risks.
With EPA now seeking to bring penalties against PlateCo for failing to meet the CD requirements, PlateCo argues any potential penalties should be excused for a time because the hurricane falls under the CD’s force majeure provision. Although it seems reasonable to excuse PlateCo’s noncompliance—the hurricane was out of PlateCo’s control—doing so may set a dangerous precedent. If EPA excuses these penalties, will EPA do the same when future climate events cause similar accidents at other Superfund sites?
EPA currently interprets force majeure provisions narrowly, but administration shifts can alter enforcement policies. This creates uncertainty for regulated entities and anyone affected by the climate-related noncompliance. Preventing the Force Majeure Problem is especially important to Environmental Justice Communities, as they disproportionately feel the effects of increased pollution. New language in EPA CDs can equitably prevent the Force Majeure Problem by incorporating the use of climate prediction models and current climate risk disclosure laws.
The force majeure doctrine emerges from tort and contract law. Also known as an “Act of God,” a force majeure event is generally an unforeseen event whose occurrence causes a party to breach a contract or act negligently. A force majeure event may be asserted as a valid defense in either scenario.
In environmental law, force majeure is an affirmative defense when provided for by statute or by EPA-issued CD. This article will focus on breach of CDs, since regulated entities have (marginally) more success in asserting a force majeure defense to a breach of CD.
EPA’s current force majeure provisions require an event be “beyond the [facility's] control.” Courts have considered a breaching party's force majeure defense invalid because of an event's foreseeability. U.S. v. Hampton Roads Sanitation Dep't, No. 2:09-CV-481, 2012 WL 1109030, at *8–9 (E.D. Va. Apr. 2, 2012). Solutions to the Force Majeure Problem will need to address this foreseeability issue as it pertains to climate change. Climate events are often thought of as classic force majeure events, but climate change will make storms, floods, and wildfires more frequent, and thus more foreseeable.
Congress amend existing laws to mandate inclusion of language in force majeure provisions. Those mandates would specifically require a showing that an event: (1) is not “foreseeable” because EPA’s climate models could have reasonably predicted or forecasted it; and (2) is not a climate risk the applicant has acknowledged pursuant to law.
The first prong of this analysis scientific data to define “foreseeability.” Regulated entities would use EPA climate models to predict climate risks and reliably determine a climate event's force majeure eligibility. Entities can access a variety of EPA climate models through EPA’s website. One such model is the Locating and Selecting Scenarios Online (LASSO) model.
LASSO guides users step-by-step through the process of identifying climate change scenarios that are relevant to their purposes. Each step allows the user to define criteria to set parameters for a model, such as the time range, measurement of precipitation or temperature, and whether the model should account for predicted increases in greenhouse gases or greenhouse gas mitigation tactics, etc. LASSO then produces a wide variety of visuals, charts, and graphs that can help users predict their climate risks.
The second prong of this analysis for an entity's acknowledged climate risks. Acknowledged climate risks would categorically exclude related climate events from force majeure contention. This encompass all laws that impose obligations upon regulated entities to disclose the risks climate events pose to their operations, including for example, the Securities and Exchange Commission’s climate disclosure rules. See Enhancement and Standardization of Climate-Related Disclosures for Investors, 87 Fed. Reg. 21334 (to be codified at 17 CFR § 229.1502(a)).
Using the legislative process to make these changes is beneficial in that the statutory provisions of environmental laws are the very basis of EPA’s enforcement authority. Furthermore, Congress has amended environmental statutes in the past to clarify those statues’ implementation. Take, for examples, the Superfund Amendments and Reauthorization Act (SARA).
SARA improved the Comprehensive Environmental Response, Compensation, and Liability Act’s (CERCLA) implementation by (1) stressing the importance of permanent remedies; (2) providing new enforcement authorities and settlement tools; (3) increasing the focus on human health problems posed by sites; and (4) encouraging greater citizen participation in deciding how sites should be cleaned up. This shows that legislative amendments are a practical tool for improving environmental statutes.
This legislative approach may also give EPA Chevron deference in defining the term “reasonably predicted or forecasted.” Under Chevron, where a statutory ambiguity exists and Congress has not defined the ambiguous language, courts will defer to an agency’s reasonable interpretation of that ambiguous language. See generally Chevron, U.S.A., Inc. v. Nat. Resources Def. Council, Inc., 467 U.S. 837 (1984). EPA has benefitted from relying on Chevron deference to exercise its enforcement authority. See generally Entergy Corp. v. Riverkeeper, Inc., 556 U.S. 208 (2009). The degree of benefit deference provides may vary depending upon the administration’s enforcement priorities. EPA currently narrowly construes force majeure provisions, suggesting deference would be effective in preventing the Force Majeure Problem. Yet, this solution faces problems.
Passing legislation at the federal level is difficult even with bipartisan support. These amendments would likely not have that support. The amendments increase regulated entity investment in climate adaptation research, development, and infrastructure. Plenty of legislators would oppose imposing more costs on businesses.
Furthermore, the emergence of the Major Questions Doctrine has weakened Chevron deference to an unknown extent. See generally West Virginia v. EPA, 142 S.Ct. 2587 (2022). The Major Questions Doctrine stands for the principle that regulatory powers of a certain scale are so impactful that Congress would not have been silent on them, had they intended an agency have that power. Id. EPA may not be able to rely on the assumption that it will receive Chevron deference when interpreting ambiguous statutory language. So, although there are benefits to taking the legislative approach in this case, amendments may be difficult to pass and implement, in practice.
To show that the proposed force majeure analysis is achievable through legislative amendment, this article uses CERCLA as an example. Congress compel inclusion of the proposed analysis in CERCLA CDs by make amendments at CERCLA sections 101 and 122.
Section 101(1) defines an “Act of God” as an “unanticipated grave natural disaster or other natural phenomenon of an exceptional, inevitable, and irresistible character, the effects of which could not have been prevented or avoided by the exercise of due care or foresight.” 42 U.S.C. § 9601(1). Section 122(d)(1)(C) governs the structure of CDs. 42 U.S.C. § 9622(d)(1)(C). Congress amend section 101(1) to reflect what an “unanticipated” event is. Adding language accomplishes that goal:
An unanticipated event is one which is unforeseeable in that that event: (1) could not have been reasonably predicted or forecasted for by using official EPA climate change models; and (2) was not acknowledged by the Settling Defendant pursuant to federal, state, and local risk disclosure laws.
Next, Congress amend section 122(d)(1)(C) by adding language:
CDs under this subsection containing a force majeure provision must incorporate the definition of an Act of God found at Section 101(1) of this title into said force majeure provision.
These amendments efficiently incorporate the proposed force majeure analysis into CERCLA CDs. Relating back to the PlateCo hypothetical, one can analyze whether the force majeure defense ought to survive. If PlateCo had disclosed to the SEC that hurricanes posed a material risk to its facility, the hurricane would be categorically excluded for force majeure contention. PlateCo would face civil penalties for not mitigating what it knew to be a possible threat to the facility. If no such disclosures were made pursuant to law, the next step would be to consult EPA’s climate models to explore whether this hurricane was reasonably foreseeable. Using LASSO, one can see that there is likely to be between a 10 to 50 percent increase in precipitation in the Region of Louisiana around the Mississippi River during the fall (hurricane season) over the next 30 years:
Even a 10 percent increase in precipitation over the next several decades should be enough to indicate to PlateCo that the site could quite possibly be subjected to more storms over that period of time, meaning PlateCo is sufficiently put on notice that most severe storms or hurricanes ought to be considered foreseeable.
This hurricane was foreseeable and should not be given force majeure status, and PlateCo should face civil penalties. Other PRPs will see this and be incentivized to avoid this scenario through mitigation procedures, which in turn should reduce the frequency and total number of hazardous substance releases.
The Force Majeure Problem will materialize in the future. Successful penalty evasion will incentivize regulated entities to avoid adopting climate-adaptive infrastructure—resulting in more instances of noncompliance.
The Force Majeure Problem can be elegantly prevented through legislative amendment. The legislative approach is legally sound but difficult to accomplish, practically speaking. However, impactful legislation always requires the most work to pass and solve the problem. The proposed amendments incentivize investment in climate-adaptive infrastructure to prevent harmful noncompliance with environmental laws.
Finally, this problem proactively is in line with this administration's desire to fight environmental injustice and adapt to climate change. Tackling this problem before it materializes prevents injustice to underserved communities and makes good on a promise to make the United States more climate resilient. Congress should act proactively, rather than reactively to best achieve these goals.
