Each month our environmental newsletter includes an environmental compliance tip/reminder. In these tips we include reminders about updating Spill Prevention Control and Countermeasure (SPCC) plans, Resource Conservation and Recovery Act (RCRA) Preparedness Plans, Stormwater permits, changes to Toxic Release Inventory (TRI) Database, United States Environmental Protection Agency (USEPA’s) Self-Disclosure Violation Policies, and more.
But environmental compliance, or at least environmental management, is so much more than what was commonly called the command-and-control. Now we have to concern ourselves with Environmental, Social, and Governance (ESG), Carbon Zero, Environmental Justice, and many more issues that have not been direct considerations related to “permitting.”
For the time being, while some of these items may be on your corporate radar, the existing framework of environmental regulations still forms the basis for environmental enforcement actions.
Billions of Dollars
It was over a decade ago that the BP plc Deepwater Horizon explosion (and subsequent sinking) that led to loss of human life and an ecological disaster occurred. This is one of the, if not the most visible “pollution events” in the recent past. While not a current event, the magnitude of the event and subsequent fine are worth a review.
According the EPA, “On April 20, 2010, the oil drilling rig Deepwater Horizon, operating in the Macondo Prospect in the Gulf of Mexico, exploded and sank resulting in the death of 11 workers on the Deepwater Horizon and the largest spill of oil in the history of marine oil drilling operations. Four-million barrels of oil flowed from the damaged Macondo well over an 87-day period, before it was finally capped on July 15, 2010. On December 15, 2010, the United States filed a complaint in District Court against BP Exploration & Production and several other defendants alleged to be responsible for the spill.”
(Photo by Prateek Kochar on Unsplash)
The subsequent oil slick covered 68,000 miles, negatively impacted commercial and tourist fisheries, and impacted the local wildlife habitat. According to an article in The Balance, oil residue cleaned up in surrounding states included
Louisiana – 9,810,133 pounds
Alabama – 941,427 pounds
Mississippi – 112,449 pounds
Florida – 73,341 pounds
The record setting settlement included a $5.5 billion Clean Water Act penalty and up to $8.8 billion in natural resource damages. According to an article last year, beyond fines, mitigation efforts have ballooned to $71 billion.
Granted, most of us are unlikely to ever be managing sites that have this type of environmental liability, but this serves as an example of how serious and tragic accidents can be. It is also a reminder of why plans (such as spill plans) must be practical and executable plans and not just plans on paper that sit on a shelf. These plans when well written (on a more typical operation) are likely to limit damages.
As an aside, it’s worth noting that according to International Tanker Owners Pollution Federation Limited (ITOPF) the number and magnitude of spills from tankers have dropped tremendously since they began tracking these data about 50 years ago.
Seven-Figure Fine and Reduction of Pollutants
In February 2021, the EPA announced the U.S. and Pennsylvania Department of Environmental Protection (PADEP) had settled a federal-state lawsuit citing violations of air, water and hazardous waste environmental laws at American Zinc Recycling Corporation (AZR’s) facility in Palmerton, Pennsylvania.
At issue were violations of the Clean Water Act, Clean Air Act, SPCC Plan requirements, RCRA, and the Emergency Planning and Community Right to Know Act.
The EPA states, “AZR has agreed to carry out an estimated $4.3 million in measures to comply with federal and state environmental laws. This settlement is expected to result in an estimated 47 million pounds of reductions of pollution from the AZR facility, including 25 million pounds of electric arc furnace dust over three years. AZR also will pay a $3.3 million penalty. The complaint and proposed consent decree were filed by the U.S. Justice Department, on behalf of the EPA and PADEP.”
The $3.3 million penalty will be divided equally between the U.S. and Pennsylvania.
Missing Risk Management Plans
Finally, while the events such as the Deepwater Horizon spill are much more in the public eye and subject matter for movies (2016 Movie Deepwater Horizon) it’s the events that did not occur that are more likely to cause you headaches and lead to fines. Permits and plans that are required but not developed or implemented can make for “low-hanging fruit” when a state or federal inspector audits a facility.
Such was the case for a facility in Kansas. “The EPA has reached a settlement with Winfield Solutions LLC, doing business as Omnium, to resolve an alleged violation of the federal Clean Air Act Risk Management Program regulations at the company’s fertilizer manufacturing and distribution facility in Dodge City, Kansas. As part of the settlement, the company will pay a $83,975 civil penalty.”
According to EPA, “Omnium is subject to Risk Management Program regulations because of the location and storage of over 20,000 pounds of aqueous ammonia in concentrations over 20% at the facility. The regulations require facilities that use extremely hazardous substances to develop a risk management plan.”
After reviewing Winfield Solutions’ facility records, EPA determined that the company failed to submit and implement a risk management plan to prevent the release of aqueous ammonia.
It’s important to know 1) what permits and plans are required and 2) make sure they are implemented. If you are not sure where you stand with respect to environmental compliance, talk to your consultant about an environmental compliance assessment. If you don’t have a consultant, we would be happy to assist you.
Success Story
We had a client several years ago with multiple facilities across the nation. Their EHS manager (who was recently hired and was a previous client) believed they were missing a specific annual filing. After meeting with us, we confirmed his suspicions. Fortunate for them, he discovered this and not a regulator. He retained legal counsel and Dragun, used the audit privilege laws, and brought all facilities up-to-date. The company avoided what could have been substantial fines.
Managing environmental issues, whether it’s existing requirements or forward looking to what may be required in the future is increasingly difficult. If you need help in evaluating your potential obligations, contact me and I’ll put you in touch with one of our senior staff. You can reach me at 248-932-0228, Ext 134.
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