Environmental, Natural Resources, & Energy Law Blog

THE “DIRTY” SOUTH

Tyler Bergeron, LLM Candidate[1]

I.                INTRODUCTION

The South. The dirty, polluted, climate-denying South. You know exactly where I’m referring to right? Okay, fine, one more—the Gulf South. A region running toward its own demise with open arms stretched wide and a giant grin on its face, leaving in its wake pollution and destruction; its path freely laid with fossil fuel development by weak environmental conservation, much less protection. As the South races toward worsened climate disaster and poor health, it takes a deep, self-aggrandizing breath of cancer-causing pollutants[2] and a quick, willful sip of its polluted water[3] for refreshment—marveling at the catastrophe sculpted by its own hands. With its competitors lagging back,[4] as other regions realize this is not a race we should win, the South’s victory seems inevitable. Well, I for one, DISAGREE.

In the U.S., the southeastern states are particularly vulnerable to and threatened by climate change.[5] While generally the South continues to resist climate policy, the State of Louisiana stands out with its recent adoption of its Climate Action Plan (or “Plan”)—a declaration that Louisianans will not sit by as their coast is swallowed into the Gulf or houses blown away by a category ‘6’[6] hurricane but rather rebuild Louisiana cleaner, safer, and electric for all.[7] Thus, Louisiana’s Plan, while not perfect, should serve as a model for other Southern states in adopting their own economic plans to combat climate change. These plans should prioritize development of Renewable and Clean Energy Portfolio Standards. And, through these plans, the South needs to subsidize and incentivize low and zero carbon development; it is time for Southern States, like Louisiana, to stop subsidizing fossil fuel and high carbon industrial-development.

II.             RECOMMENDED ACTIONS FOR THE SOUTH TO CHANGE COURSE

A.    Develop Climate Action Plans

The very first step to addressing climate change is to first acknowledge that, because of human activities for the last two-hundred years, the climate is changing, and the planet is warming—unnaturally. Once acknowledged, combating climate change from every possible angle of a state’s economy requires a plan. Thirty-three states in the U.S. have adopted some sort of climate action plan, with roughly two-thirds of the plans being less than 5 years old.[8] Adopted in 2022, Louisiana’s Climate Action Plan is a testament that the Deep South is not only ready to acknowledge it is running in this losing race but ready to bail on the race and join the reality of addressing climate change, now.[9] Louisiana’s bipartisan, cross-economic plan to combat climate change can and should serve as a model for all to adopt their own climate action plans. While Alabama may find an approach taken by Oregon difficult to adopt due to their economic, cultural, and ideological differences, Southern States readily identify and band together since they share many geopolitical and cultural similarities.

         By executive order in 2020, Louisiana Governor John Bel Edwards established the ‘Climate Initiatives Task Force’ (or “Task Force”) charged with the following duties:

A.      Review and comment on ongoing efforts to update the state’s greenhouse gas emissions inventory;

B.      Investigate and make recommendations for the reduction of [GHG] emissions originating in Louisiana to achieve the following [GHG] emissions goals:

1.       By 2025, reduce net [GHG] emissions by 26-28% of 2005 levels;

2.       By 2030, reduce net [GHG] emissions by 40-50% of 2005 levels; and

3.       By 2050, reduce net [GHG] emissions to net zero;

C.      Develop policies, strategies, and incentives designed to achieve the net emissions reduction targets established in this Order, while improving the health and welfare of the people of Louisiana and advancing Louisiana’s economic and energy profile.[10]

The Order required the Task Force to establish and submit a detailed plan for meeting the GHG emissions goals to the Governor and Coastal Protection & Restoration Board by February 1, 2022.[11] The Task Force is comprised of members from the government, private sector, industry, academia, and community and environmental advocates;[12] it is further supported by volunteers organized into six committees representing the different sectors of Louisiana’s economy and four advisory groups focused on science, equity, legal and financial considerations.[13] Thus, the Task Force was uniquely established to reflect and represent Louisiana’s economy rather than serve as a political board passing a generic de-carbonization plan.

Through the course of over 49 public meetings over 15-months, the Task Force developed the Louisiana Climate Action Plan which “contains 28 strategies and 84 specific actions to reduce GHG emissions across the entire state economy.”[14] The Plan’s recommendations are divided into eight strategies: (1) Clean Energy Transition; (2) Industrial Decarbonizations; (3) Actively Managed Methane Emissions; (4). Transportation,Development, and the Built Environment; (5) Natural and Working Lands and Wetlands; (5) An Inclusive, Low-Carbon Economy; (6) Collaboration and Partnership to Ensure Successful implementation; and (8) Accountability and Adaptability to Ensure Lasting Success.[15] And, the Plan is based on three policy pillars: (1) renewable electricity generation, (2) industrial electrification, and (3) industrial fuel switching to low and no-carbon hydrogen.[16] The Task Force approved the Climate Action Plan in January of 2022 and delivered it to the Governor on February 1, 2022. The founding Order requires the Task Force to meet at least annually and submit annual status reports on the implementation of the strategies, policies, and incentives;[17] it also authorized and directed all departments, commissions, boards, agencies, officers, or any political subdivisions thereof to cooperate with the Task Force in implementing its recommendations.[18] The implementation of the Plan has been ongoing ever since.[19] [20]

         Louisiana’s Climate Action Plan can be an excellent model for other Southern States. It was developed with everyone at the table: scientists, government bureaucrats, industrial representatives, workers and tradesfolk, environmentalists, advocates, representatives of indigenous communities, and more. This allowed a bipartisan, noncontroversial, and yet decisive climate action plan to pass. Other Southern States need to take the first step in their fights against climate change—acknowledging the imminence of its threat. Then, they need to establish their own task forces to develop climate action plans unique to their own economies.[21] Louisiana’s Climate Action Plan is not perfect, but it demonstrates that the South is ready to fight climate change. So, I urge the other Southern States: Join Louisiana—forfeit the Race.

         Below are two key aspects of any legitimate climate action plan: Renewable and Clean Energy Portfolio Standards and a policy shift from subsidizing high-carbon emitting industrial-development to subsidizing low to zero carbon development.

B.    Establish Renewable and Clean Energy Portfolios

One critical step in the fight against climate change is to switch to clean and renewable energy generation sources, such as nuclear and hydrogen and solar and wind, respectively. Across the country, states have adopted Renewable Energy Portfolios (REP), which require or encourage electricity suppliers to provide their customers with a stated minimum share of electricity from eligible sources.[22] Some states have adopted renewable portfolio standards (RPS) and others have established goals. On a map depicting states that have adopted RPS or goals, a large cluster of states remains blank: the South.[23]

Currently, most Southern States are relying on market pressures to compel their transitions from fossil fuels to clean and renewable energy. But, in a race against time where even incremental reductions in emissions can help mitigate the effects of climate change, relying on market pressure is not sufficient. Rather, Southern States should establish REPs and RPSs to help foster and hasten the transition to clean energy. According to the Energy Information Administration, roughly half of all growth in U.S. renewable electricity generation and capacity since 2000 is associated with state RPS requirements.”[24] While the role of RPS has diminished in more recent years due to market pressures, “RPS policies continue to serve a central role in motivating growth in renewable electricity generation.”[25]

A key priority of any state developing a climate action plan should be to transition its grid to clean energy and to officially embrace and adopt RPSs as part of its climate plan—the latter being a weakness in Louisiana’s Plan. While Louisiana’s Climate Action Plan calls for establishing a “Renewable and Clean Energy Portfolio Standard (RCPS)” requiring “100% ofelectricity generation be derived from renewable or clean resources by 2035, with at least 80% of total generation from renewable sources by 2050,”[26] Louisiana’s Public Service Commission is a separately created constitutional-body that is not subject to the authority of the Governor.[27] Consequently, the Louisiana Public Service Commission does not have to adopt the Plan’s proposed RCPS, despite the otherwise ongoing implementation of the Climate Action Plan. So, despite the adoption and implementation of the Climate Action Plan, Louisiana remains on the long list of Southern States that have not adopted Renewable and Clean Energy Portfolio Standards—or even goals.

To effectively join the Nation’s fight against climate change, Southern states must work to quickly adopt and begin working to achieve Renewable and Clean Energy Portfolio Standards, as a necessary part of any climate action plan.

C.    Limit Tax-Exemptions to Low-Zero Carbon and Pollution Development

At its core, a major part of the South’s struggle and resistance to implementing climate policy is rooted in money. Three of the five gulf states have the highest percentages of poverty in the country—Texas and Florida excluded.[28] The fossil fuel industry has had the South in a chokehold for decades, and Southerners are convinced that they cannot afford to fight back, despite being, arguably, the region most vulnerable to climate change in the continental-United States. In 2009, the Louisiana Public Service Commission rejected the only renewable energy portfolio ever proposed before the Commission for being too costly for utility customers.[29] While fear of economic uncertainty and financial upheaval is understandable, the political hesitancy in fighting and mitigating the effects of climate change is ultimately costing the South more in the long run. The South needs help financing the transition and will not be able to fund it on its own. However, while waiting for federal funding, Southern States can start acquiring new funding for its transition from those freely causing harm to the states and peoples, industry.

Southern States should limit tax-exemptions, such as those granted under various states’property and development tax programs, to low and zero carbon and pollution industrial development. Rather than granting a property tax exemption to, for example, a new oil refinery for 10 years, the South should prioritize granting such exemptions to clean or renewable energy projects, wind-turbine blade manufacturing plants, and other climate-conscious development. Louisiana, particularly, also needs to revise its Industrial Tax Exemption Program (ITEP), which historically fully exempted manufactures[30] from paying property taxes for 10 years. The state also recently reduced this full exemption to an 80% exemption for two five-year periods.[31] Aside from the health and climate consequences of continuing to subsidize fossil fuel development through these exemptions, in Louisiana, ITEP exemptions were granted by a state board at a 99.95% approval rate which lost the state $1.9 billion in 2017 alone;[32] money that could go to its coastal restoration initiatives, electrifying its public transportation system, or toward updating its aging water systems—one in five of which do not meet the standards set by Louisiana’s Health and Environmental Quality departments.[33] Instead, the South continuously defends and protects these industries which only have polluted our air and water—these subsidies lead to places like “Cancer Alley”[34] in Louisiana. Thus, Southern States, like Louisiana, must revise or pass legislation only exempting new low-carbon and zero carbon facilities from their industrial development taxes.

By limiting exemptions like ITEP to low and zero carbon industrial development, Southern States will actively incentivize clean energy facilities and apply more pressure for low-zero carbon development, which may help to boost their carbon-neutral and zero transitions. While some residents of the Southern States will likely complain about removing the exemptions for high-carbon development, states can defend these actions by noting that they are not adding a new tax or ban on fossil fuel development but are only ensuring those facilities pay what the law already requires of such development and every other ‘person’—taxes.

III.           CONCLUSION

         Climate change is the largest and most imminent existential threat to our planet and our country, but especially to the Gulf South. As an area historically resistant to climate policy, establishing a Climate Task Force in each Southern State will be difficult. But, as the realities of climate change continue to take hold, and as illustrated by Louisiana, Southerners are waking up and realizing they are in a losing race. The best way to help the South transition to clean economies is through continuing to incentivize and subsidize the transition. Louisiana is a testament to the fact that Southerners are willing to implement climate policies and action plans and other states should follow suit. The states, including Louisiana, should take the steps to ensure that their plans include Renewable and Clean Energy Portfolio Standards—not more aspirations. In doing so, the South can find its victory in forfeiting the race to its own demise.