Green Building Law Update

The Intersection of Real Estate, Science, and Law

Battery Storage: The New “Must Have” Amenity in Commercial Leases

Battery storage has become one of the hottest topics in commercial real estate leasing, a key amenity and, increasingly, a top tenant ask in Class A buildings. What was barely on the radar five years ago has now emerged as a central negotiating point between sophisticated tenants and landlords.

Electricity has become a bellwether political issue across the country, and energy reliability is at the heart of the discussion. In jurisdictions like Maryland, where electricity generation shortfalls are well documented, battery storage is not just a sustainability measure, it is a business continuity imperative.

Many will recall the famous scene from the 1967 film The Graduate in which Dustin Hoffman’s character is told the secret of future economic success, “just one word .. plastics.” In 2025, the one word is now batteries.

PJM Interconnection, which manages the regional electric grid serving Maryland and much of the Mid Atlantic, has repeatedly warned that “rolling brownouts or blackouts are a possibility” and that the state faces “risks of electricity supply shortfalls during periods of more extreme conditions,” such as severe heat waves or cold snaps. These warnings are not theoretical; they were issued in 2025, now shaping how tenants view energy resilience in site selection and lease negotiations.

This is not a partisan political issue. “There’s some bad energy policies in some of our neighboring states ..,” Democrat Virginia Governor elect Abigail Spanberger said this Sunday on Face the Nation. “We have to be clear-eyed about the fact that we will have an energy crisis headed into the future.”

Energy Resilience

Tenants, especially those whose operations depend on uninterrupted power, not only hospitals, but also data driven enterprises, AI companies, financial institutions, and life sciences tenants, increasingly view on site battery storage as a critical feature, not to mention those that occupy any building with an elevator. These systems provide backup power during brownouts, grid outages, or severe weather events, ensuring business continuity when the public grid cannot.

Moreover, tenants are rejecting buildings where owners have agreed to participate in demand response programs with electric utilities.

Cost Management

Battery storage also offers clear economic benefits. Through “peak shaving” drawing stored electricity during periods of high demand tenants can dramatically reduce utility costs. Energy arbitrage, storing energy during off peak hours for use during peak times, provides another layer of cost optimization. These features allow tenants to manage their energy budgets with precision, particularly as utility rate structures become more dynamic.

Sustainability and Regulatory Drivers

The sustainability story is equally compelling. Businesses in some locales face mounting pressure to meet statutory carbon reduction benchmarks. Buildings that offer on site renewable energy, such as solar paired with battery storage, may enable tenants to meet those goals. In Maryland, the Building Energy Performance Standards (BEPS) and similar schemes require reductions in Scope 1 greenhouse gas emissions and total energy use. For many buildings, compliance is only achievable through the integration of renewable generation with battery storage systems.

At the same time, some governments are actually banning fossil fuel backup generators, including in Maryland, which has laws moving toward all electric buildings. In some jurisdictions, using natural gas, petroleum, or other fossil fuel backup systems is becoming unlawful even in extreme emergencies. That regulatory shift makes battery storage even more valuable as the sole viable form of on site energy resilience.

The Technology Behind the Trend

From Alessandro Volta’s 1800 “voltaic pile,” a stack of zinc and copper discs separated by brine soaked cloth, to today’s advanced lithium ion systems, battery technology has come a long way. Most commercial building installations today use lithium ion batteries, though other types such as large scale lead acid and flow batteries, exist.

The next generation is already here: solid state batteries. These offer higher energy density, improved safety (no flammable liquid electrolytes), and faster charging. Costs remain high, but are falling fast. In our own building, we have installed pilot solid state batteries sourced domestically, an important distinction in light of U.S. dependence on foreign critical minerals, child labor, and other ethical concerns that surround parts of the global battery supply chain.

At its core, a battery converts chemical energy into electrical energy through an electrochemical reaction between an anode (negative terminal), a cathode (positive terminal), and an electrolyte. In the built environment, batteries are transforming from small scale backup devices for computers and servers into building scale infrastructure.

A Real Estate Revolution

Significantly, in a recent survey by a global commercial real estate firm, battery storage ranked among the top five issues in U.S. lease negotiations for the first time ever. This is a major shift. As battery storage becomes standard in Class A buildings, the trend will inevitably cascade to other building classes, reshaping expectations across the market.

Even government buildings are in the mix. Many public sector facilities are subject to “demand response” mandates that require them to reduce energy use first during grid strain. Talked about scenarios include school and government office “brown outs,” temporarily, so private businesses and residences maintain reliable electricity without interruption.

The Broader Context

Electricity is essential to modern society, powering everything from healthcare systems to data centers to smartphones. Yet in Maryland, which already imports over 40% of its electricity from other PJM states, energy independence is a long way off. Battery storage is not merely an amenity; it is key short and mid term nonlinear progress to human innovation, if not survival.

Globally, batteries expand access to reliable electricity, combating poverty and improving quality of life. Here at home, they are already redefining what it means to occupy a quality commercial property with state of the art infrastructure and amenities.

While battery storage did not even make the top ten list of tenant concerns five years ago, today it is one of the most sought after features. And interestingly, another new top five issue is enhanced building security, a blog topic for another day.

For now, it is enough to say this: battery storage is no longer a futuristic option. It is a present day necessity, and the newest hallmark of thriving commercial real estate.

In 2025, the one word is batteries.

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Join us for the next in our webinar series at the Intersection of Business, Science, and Law, “From Boilerplate to Benchmarking: The New Era of Greenhouse Gas Lease Provisions” on Tues, Nov 18 at 9 am. The webinar is complimentary, but you must register here.

Federal Bank Regulators Withdraw Climate Mandates

By Stuart Kaplow on November 2, 2025 Posted in Climate Change, Codes and Regulations, Federal

On October 16, the Federal Deposit Insurance Corporation, the Federal Reserve Board, and the Office of the Comptroller of the Currency jointly “.. announced the withdrawal of their interagency Principles for Climate-Related Financial Risk Management for Large Financial Institutions.”

This is a positive and, frankly, refreshing development, a rare instance of government appropriately narrowing its focus and returning to its statutory mission. The decision, effective immediately, recognizes that banking regulation is not the right tool to fight climate change.

What Happened

In their joint release, the threesome explained:

“The agencies do not believe principles for managing climate-related financial risk are necessary because the agencies’ existing safety and soundness standards require all supervised institutions to have effective risk management commensurate with their size, complexity, and activities.”

In short, the existing regulatory framework already obligates banks to manage all material risks. There is no need nor a rational basis for a bespoke climate overlay.

The Background

The now withdrawn 2023 guidance would have applied to banks with more than $100 billion in assets (.. being the banks the large majority of Americans do business with), requiring the boards of directors to explicitly incorporate climate risk into their long term planning. While environmental advocates applauded the move, financial institutions and many regulators expressed concern that the agencies had gone far beyond their statutory authority.

As Federal Reserve Governor Chris Waller aptly observed, the risks posed by global climate change are not “sufficiently unique or material to merit special treatment relative to other risks.” And Vice Chair for Supervision Michelle Bowman warned that the principles “far exceed the narrow mandate of the Fed, which is stable inflation and maximum employment.”

The Federal Reserve’s purpose is not to manage the Earth’s climate. Its role is to safeguard U.S. monetary stability and the financial system. Using unelected banking regulators to steer capital away from carbon intensive industries, or to penalize banks for financing them, is mission creep, if not a whole lot more.

The Problem with Mission Creep

When the Federal Reserve or its sister agencies wade into politically charged territory, particularly one that is beyond their ability to meaningfully influence, the result is distraction, inefficiency, and, often, unintended harm.

During the pandemic, for example, the Fed missed its inflation target while devoting disproportionate attention to distributional and social objectives. The delayed rate hikes that followed arguably contributed to entrenched inflation. Expanding the Fed’s purview to climate policy risked repeating that error: chasing objectives outside its lane while losing focus on its core responsibilities.

Moreover, financial institutions are already required to manage risk. They assess credit, liquidity, operational, market, and reputational risks daily. If climate risk is truly material to a bank’s balance sheet, it will already be factored into those calculations. If it isn’t material, forcing it into regulatory frameworks distorts price signals, misallocates capital, and potentially constrains legitimate lending.

Unintended Consequences of the Withdrawn Guidance

The now rescinded principles introduced uncertainty and additional compliance burdens without a clear quantifiable benefit. Banks were expected to conduct “long-term scenario analysis” extending far beyond the horizon of traditional financial modeling, often decades into the future.

But financial regulation must rest on measurable, near term risks. Predicting the financial implications of climate trends 50 years from now is inherently speculative (.. and yes, we have undertaken that conjectural scenario analysis for clients). Worse, the vague language in the 2023 principles meant institutions faced unclear expectations and the risk of ever tightening oversight.

The “transition risk” framework, in which banks were expected to treat carbon intensive businesses as inherently riskier, posed particular problems. It effectively sought to constrain lending to lawful industries through regulatory pressure rather than through transparent legislative action. That is not the role of a prudential regulator.

The predictable result would have been reduced credit availability and higher borrowing costs for energy producers, manufacturers, and even home builders, not because of actual credit risk, but because of regulatory signaling. That is policymaking by proxy, not risk management.

The Correct Course

By withdrawing the climate risk guidance, the Fed, FDIC, and OCC have reaffirmed a crucial principle: regulators must operate within their mandates. Prudential oversight should focus on the safety and soundness of the U.S. banking system, not on climate policy objectives.

This does not mean banks should ignore climate related factors. To the contrary, financial institutions must continue to identify, measure, and manage all material risks, including those arising from environmental conditions when relevant. But they should do so within the existing risk management frameworks, not under the weight of politically charged, redundant guidance.

The rescission also helps restore the credibility of financial regulators by signaling restraint. Regulatory sprawl undermines confidence; disciplined focus restores it.

A Broader Shift

This action aligns with the current administration’s broader rollback of climate related mandates across federal agencies. In recent months, executive orders have rescinded prior climate initiatives, the SEC has halted its defense of its climate disclosure rule, and several federal departments have eliminated previously articulated ESG driven programs.

At the same time, many financial institutions are unwinding voluntary commitments such as membership in the Net Zero Banking Alliance, which formally disbanded this month after widespread withdrawals by global banks.

Even climate advocate Bill Gates recently wrote that the “doomsday view” of climate change is wrong, and “it’s diverting resources from the most effective things we should be doing to improve life in a warming world.” That realism, not resignation, is the current proper mindset.

Staying Grounded in Law and Economics

Environmental lawyers understand addressing climate change. But we also understand that sound environmental policy must be grounded in law, not aspiration. It is not the Fed’s job to impose environmental schemes through the back door of financial supervision.

Climate risk belongs where it can be measured and managed, in environmental law, in energy policy, and in the marketplace of ideas and investment. Banks should evaluate it as part of their general risk frameworks, not as a special category elevated by politics.

Conclusion

The withdrawal of the interagency climate risk principles is not a rejection of environmental stewardship. It is a reaffirmation of disciplined governance.

The Federal Reserve, FDIC, and OCC have rightly recognized that their role is to ensure financial stability, including increasingly in non bank transactions in bitcoin and Stablecoin, not to dictate global environmental outcomes. Climate change is real, but it is not a financial crisis, and it should not be treated as one by bank supervisors.

By refocusing on their statutory mandates, regulators can strengthen both financial and environmental outcomes: a stable banking system and a more honest, effective dialogue about how best to protect human health and the environment, in the right forums, through the right tools, and for the right reasons.

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From Boilerplate to Benchmarking: The New Era of Climate Smart Leases

By Stuart Kaplow on October 26, 2025 Posted in Codes and Regulations, Energy, GHG, Green Building, greenhouse gas

It would be convenient if this were only a prospective conversation about the leases you are about to sign. It isn’t. Tens of thousands of existing leases (many with long renewal terms) are for premises that are subject to greenhouse gas disclosure and reduction laws already on the books and now being phased into effect. That reality makes this subject urgent: leases drafted decades ago, long before anyone contemplated building energy performance standards (BEPS) or whole building emissions reporting or net zero energy mandates, must now be revisited.

Public sentiment about government climate measures ebbs and flows. Laws do not. From Maryland to California, New York City to Denver, and Seattle to Washington, D.C., jurisdictions have enacted BEPS, clean heat rules, and related regimes that are forcing building owners to reduce emissions or face penalties. These rules typically target building owners, but the right (or wrong) lease language will determine whether those costs and obligations ultimately fall on landlords, tenants, or both. And these issues arise not only in commercial leases, many multifamily leases implicate the same concerns.

The cost of compliance with these new climate laws will often dwarf the value of a lease if not the building itself (e.g., converting natural gas powered HVAC to all electric).

Buildings are the sweet spot for GHG emissions reductions: they account for nearly 40% of U.S. emissions. That is why property owners and tenants must treat lease language about energy, data, and compliance as material business terms.

Below is a tactical roadmap, focused on Maryland but relevant elsewhere, to begin to help owners, tenants, brokers, and in house counsel identify the provisions in a lease that matter, and the sort of language to consider.

1. Start by reviewing every lease you have, now

A review should not be a checkbox exercise. Begin with these questions for buildings in regulated jurisdictions:

Does the lease have a general “compliance with law” clause? Who bears the obligation to comply with statutes and regulations that affect the leased premises and the building?
Does the lease address energy data sharing, submetering, or benchmarking?
Are operating expenses and capital expenditures defined in a way that captures costs of retro commissioning, BEPS compliance, or penalties?
Do tenant improvement and renovation provisions require compliance with building energy standards?
Is there express allocation of responsibility for BEPS fines, alternative compliance fees, or excess emissions charges?

A seemingly boilerplate clause about “complying with laws” historically aimed at ADA or fire sprinklers can be determinative here, but it is only the starting point.

2. Make energy and GHG emissions data sharing standard

It may be a myth that if you cannot measure it,

you cannot manage it. But Maryland law already requires utilities to provide whole building and aggregate energy data to owners for benchmarking purposes (Maryland Senate Bill 2022, 528). In practice, however, utilities’ data alone is insufficient for a building owner to calculate attributable tenant GHG emissions. Owners will need tenant level inputs: employee counts, operating hours, plug load inventories, and information about tenant equipment and processes.

As a threshold edit, virtually all leases, existing and new, should likely be amended to require tenants to share energy related data and occupant information needed for GHG reporting and benchmarking.

That clause can carve out proprietary tenant information, protect trade secrets, and limit public disclosure where legally permitted, but the core obligation to share data should be explicit.

3. Define the standards that matter

Where jurisdictions impose actual limits on building energy use or emissions (not merely reporting), the lease must define the applicable standard. Useful defined terms include:

Building Energy Performance Standard (BEPS). Identify the statute, code section, or regulatory rule, and any thresholds or compliance dates that apply to the building.
Energy Consumption Limit. A numerical limit (kWh, kBtu, or emissions metric) that the tenant is expected not to exceed.
Plug Load Standard. If tenant equipment/displays are regulated, define the metric and measurement approach.
Retro-commissioning. Define scope (e.g., HVAC, lighting, controls), the standard of work (ASHRAE, LEED enhanced credit, or equivalent), and the process/timing.
Energy Data. As above, define what data and level of granularity is required.

If a tenant will be subject to an energy consumption cap (because the building is), that cap must be expressed in the lease, tied to a recognized metric and testing/measurement protocol, and accompanied by an agreed upon method for calculating exceptions and credits.

4. Submetering and measurement

Accurate measurement is the foundation of enforcing allocation. Submetering the leased premises, with meters capable of recording demand and kWh, should be standard where practicable. In many older buildings true submetering will be difficult or regulated by public utility commissions; electronic submetering software that simulates tenant load may be a substitute but must be expressly permitted and described.

The lease should specify:

who installs and pays for submeters,
standards for meter accuracy,
how data is shared and retained,
responsibility for meter maintenance, and
consequences for meter failure or bad data.

5. Operating expenses, capital expenditures, and amortization

Expectations about what is a reimbursable operating expense versus a capital expenditure will intersect with BEPS compliance. Consider:

Including a tenant’s prorata share of the costs to undertake whole building retro commissioning and BEPS compliance in operating expenses;
Allowing certain capital improvements made to meet BEPS to be amortized and charged to tenants over a reasonable period (e.g., the useful life or the remainder of the lease term);
Requiring tenant cooperation in retro commissioning, including providing occupant data and access, and making the tenant responsible for costs that are directly attributable to its premises or operations.

These allocations are all new and while they have not existed in the past, today are negotiable commercial terms, but silence in the lease often defaults to landlord risk exposure.

6. Tenant improvements and renovations: design to perform

Leases should require that initial tenant improvements and subsequent renovations:

comply with applicable (including out year requirements of) BEPS,
not increase the tenant’s plug or energy consumption above an agreed baseline without landlord approval,
meet specified design criteria (e.g., lighting power density, HVAC efficiency), and
provide for landlord review and approval of design and scope.

That language prevents tenant buildouts from undermining whole building compliance.

7. Incentives to rebalance equities

Traditional allocations (landlord pays capital; tenant pays utilities) may no longer reflect risk and value. Creative incentives help align interests:

GHG Reduction Bonus. A landlord could pay a tenant a percentage bonus upon completion of tenant improvements that achieve modeled reductions (amortized as a rent credit).
Assignment of Incentives. Lease language can be used so that tenants receive tax deductions or incentives (e.g., 179D type benefits) through assignments or sharing mechanisms.
On site renewable participation. If the landlord installs on site renewables, require tenants to purchase that power at or below local utility rates and offer tenants participation in PPAs where feasible.

Incentive language unlocks cooperation where otherwise each party would act alone.

8. Penalties and enforcement

If a jurisdiction imposes fines, excess emissions charges, or alternative compliance payments on the building owner, the lease must allocate responsibility clearly:

Tenants should be responsible for penalties attributable to their excess consumption or failure to provide required data where their actions or admissions cause noncompliance.
Landlords should remain responsible for penalties caused by their failure to timely report, their failure to maintain building systems, or the consumption of other tenants.
The lease should specify how credits, offsets, or alternative compliance fees are applied and whether the cost of purchased credits is treated as operating expense.

This is one of the most contentious negotiation points and will soon be an issue of first impression before rent court judges. Reasonable compromise mechanisms include thresholds for tenant liability, notice and cure periods, and caps tied to a tenant’s proportionate share.

9. Litigation is inevitable, but don’t wait

There is litigation challenging BEPS statutes in several states (including leveraging federal government objections to this regulatory scheme), and including litigation pending against Maryland’s programs. Those suits will almost certainly succeed in whole or part. Litigation, however, does not eliminate the immediate practical problem: property owners must comply with the law as it exists today or risk fines, lost incentives, or reputational harm. The prudent course is to mitigate risk today by amending leases and implementing data collection and energy management systems, even as parties reserve their litigation rights.

But it is the future litigation enforcing GHG lease provisions that scares the heebie jeebie’s out of many. Beyond the cost of compliance itself, it is that risk of litigation that is contributing to significantly driving down the value of real estate subject to these climate laws.

Closing thought

Drafting leases to address GHG obligations is an art in its infancy. The risks and opportunities are not new; I wrote about many of these issues in a 2009 law review article titled Does a Green Building Need a Green Lease?, but today the dollar stakes are higher and the mandatory statutory architecture is spreading geographically.

This post is not a comprehensive legal brief. It is a call to action: review your leases, start sharing data, define the standards that will govern performance, allocate risks, share costs and penalties with clarity, and use incentives to align landlord and tenant interests. For property owners and tenants who want to minimize surprise costs and regulatory exposure, now is the time to act. This includes, importantly, not only updating lease forms; but also existing leases.

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California Sues Plastic Bag Makers Over “Recyclable”

By Stuart Kaplow on October 19, 2025 Posted in Environmental, recycling, State

Last Friday, California Attorney General Rob Bonta announced a new front in the state’s ongoing battle against plastic pollution. The Attorney General filed suit against three of the nation’s largest plastic bag manufacturers, Novolex Holdings LLC, Inteplast Group Corp., and Mettler Packaging LLC, alleging that the companies falsely labeled carry out bags “recyclable” and “return to participating store for recycling,” .. despite that the bags are objectively “recyclable.”

At the same time, the Attorney General announced settlements with four other plastic bag producers, Revolution Sustainable Solutions LLC, Metro Poly Corp., PreZero US Packaging LLC, and Advance Polybag, Inc., resolving similar allegations. Under those settlements, found here, here, and here, which are subject to court approval, the companies agreed to halt plastic bag sales in California (what many have alleged is the aim here) and collectively pay $1.75 million, including $1.1 million in civil penalties and $636,000 in attorneys’ fees and costs.

A Broader Context: The Plastic Problem

California alleges that in the 1950s, the world produced about 1.5 million tons of plastic annually. Today, that figure exceeds 300 million tons, and it continues to rise despite decades of “recycling” messaging; the plastic recycling rate in the U.S. hovers around 6 percent. The other 94 percent is landfilled, incinerated, or released into the environment.

California’s Statewide Commission on Recycling Markets and Curbside Recycling has concluded that of the seven general categories of plastic, only three, all variations of plastic bottles, meet the legal definition of “recyclable” in California. Plastic film, including grocery bags, does not.

Plastic bags, in particular, pose unique harm. California says that less than 5 percent of single use plastic bags were actually recycled. The remainder clog sorting machines, shut down recycling equipment, and endanger workers. They block waterways, pollute ecosystems, and break down into microplastics that have now been found in drinking water, food, air, and even human lungs and breast milk.

California’s Legal Framework: SB 270

California’s SB 270, enacted in 2014 and effective since 2016, banned single use plastic carry out bags in major retail settings and allowed only thicker, reusable plastic film bags that meet stringent criteria. Among other things, those bags must:

Contain at least 40 percent recycled content;
Be capable of 125 uses while carrying a specified weight; and
Be “recyclable in the state” meaning there must exist actual, functioning infrastructure and markets to process them.

The law also authorizes the Attorney General to enforce compliance and to penalize deceptive environmental marketing or mislabeling.

The Allegations

The state’s new lawsuit contends that Novolex, Inteplast, and Mettler have sold billions of plastic carry-out bags in California since SB 270 took effect, bags advertised as “recyclable” that, in practice, are not (recycled; but not that they are not recyclable).

The complaint alleges that:

The companies used recycling symbols and language such as “recyclable” and “return to store for recycling,” implying compliance with SB 270 when in fact California recycling facilities, the vast majority of which are government owned, overwhelmingly reject plastic bags.
A state survey of 69 recycling facilities found only two that claimed to accept plastic bags, and even those could not confirm the material was ever recycled.
The defendants self certified to CalRecycle that their products met the “recyclable in the state” standard, but failed to substantiate those claims.

In total, the state alleges that the defendants sold more than 4.3 billion bags in California and earned over $33 million from those sales since 2020.

The Legal Theories

The complaint proceeds under five interrelated legal theories:

Unlawful sale and distribution of plastic grocery bags;
Misleading environmental marketing;
Failure to substantiate environmental marketing claims:
Untrue or misleading advertising; and
Unlawful unfair or fraudulent business practices.

Relief Sought

The Attorney General seeks:

Injunctive relief to stop the defendants from selling or advertising non recyclable bags in California;
Disgorgement of profits derived from alleged violations; and
Civil penalties under the statutes.

Why This Matters

For years, the plastics industry has framed recycling as an answer to public concern over plastic pollution. But as this case alleges, labeling a product “recyclable” does not mean it is ever recycled. Without actual collection systems, processing capacity, and end markets, recyclability remains a marketing term, not a material fact; ignoring the key fact that the vast majority of recycling facilities in California are owned by California governments that simply refuse to recycle plastic bags.

From an environmental law perspective, the Attorney General’s action reflects his larger target of the fossil fuel industry (that supplies the raw materials for the manufacture of plastic bags) and a next step in green claim enforcement: a shift from merely regulating environmental harm to policing the truthfulness of environmental claims themselves.

This enforcement approach matters for businesses across sectors, not just plastics, as blue state attorneys general increase scrutiny of “greenwashing.” Companies making sustainability claims will need substantiation rooted in real world infrastructure and data, not just technical possibilities or aspirational language.

Key Takeaways for Businesses

Recyclability must be real, not theoretical. Claims that a product can be recycled are misleading if no practical means exist for that material to be collected, processed, and sold for reuse.
Self certification is not immunity. Companies that self certify compliance with state or federal environmental labeling standards must maintain contemporaneous documentation proving the basis of each claim.
Green marketing is now a legal compliance issue. Environmental and sustainability claims fall squarely within advertising, consumer protection, and unfair competition statutes.
Supply chain accountability matters. Manufacturers, importers, distributors, and retailers may all bear liability for false or misleading recyclability representations.
Enforcement is accelerating. State attorneys general are actively examining packaging, labeling, and recyclability claims.
Action steps: Review all environmental claims (including “recyclable,” “compostable,” “biodegradable,” and “carbon neutral”), verify the infrastructure exists to support those claims, and consult environmental counsel before making any of those claims public facing.

Closing Thought

Recycling in any meaningful way has been unattainable across the country and has continued to exist as a fanciful hope foisted on the American public. Singling out all of the single use plastic bag manufacturers in a state will not improve the situation. It simply is antibusiness.

Moreover, in this instance, when the vast majority of recycling facilities are owned by the governments in California, to claim that those facilities that refuse to recycle plastic bags result in plastic bags not being recyclable, stretches credulity.

However, this case serves as a stark reminder that environmental compliance today extends far beyond emissions and permits. It also goes beyond objective truth. Being recyclable, even if true, is in and of itself not enough under the theories advanced by the California Attorney General. For manufacturers, brand owners, and retailers alike, California’s lawsuit underscores a new era, beyond strict compliance with the FTC Green Guides, in which words like “recyclable” are not given the ordinary dictionary definition, but rather are subject to interpretation by state policy making public officials.

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Inhalers and the Planet: Breathing Room in Environmental Policy

By Stuart Kaplow on October 12, 2025 Posted in Environmental, greenhouse gas, Sustainability

The mainstream press was quick to report this week on a startling new study out of UCLA: inhalers used to treat asthma and chronic obstructive pulmonary disease (COPD) produce greenhouse gas emissions equivalent to 530,000 cars on the road each year. Published on October 6, 2025, the study quantified that inhalers approved for asthma and COPD generated an estimated 24.9 million metric tons of carbon dioxide equivalent (CO₂e) from 2014 to 2024, a misleadingly frightening number.

Yet before anyone stops using their inhaler, let’s be clear: don’t. These are life saving medical devices. Millions of Americans, and tens of millions more across the globe, depend on them daily for the simple, essential act of breathing.

The Numbers Behind the Emissions

According to the university researchers, 1.6 billion inhalers were dispensed in the U.S. over the past decade, producing nearly 25 million metric tons of CO₂e. The study found that 98% of those emissions came from metered dose inhalers,the familiar devices that use hydrofluoroalkane propellants to deliver medicine directly to the lungs.

From 2014 to 2024, annual inhaler related emissions rose by 24%, from 1.9 million to 2.3 million metric tons of CO₂e. Just three inhaler types, those containing albuterol, budesonide-formoterol, and fluticasone propionate, accounted for a remarkable 87% of those emissions.

The Climate Context

These findings matter because hydrofluoroalkanes, while safe for the ozone layer, are potent greenhouse gases. Ironically, the federal government has been phasing down hydrofluorocarbons under the American Innovation and Manufacturing Act as part of its broader climate policy, yet this data reveals an overlooked emissions source right in the nation’s medicine cabinets. With no good U.S. data, it is worth noting that, based on U.K. data from across the pond, inhalers account for only 0.14% of all carbon emissions in Britain.

The Trump Administration has not yet indicated how it will address this issue, and to date, there has been no coordinated federal effort to regulate or mitigate inhaler related greenhouse gas emissions.

Balancing Health and Sustainability

There’s no denying the environmental impact (.. assuming the assumptions made by the UCLA researchers are correct?). But there’s also no denying the medical necessity. Asthma and COPD affect tens of millions of Americans and hundreds of millions worldwide. Any transition away from current inhalers must not sacrifice public health.

Some environmental groups have suggested shifting prescribing patterns toward dry powder inhalers or soft mist inhalers, both of which deliver medication without using greenhouse gas propellants. But these alternatives come with challenges: they are not suitable for all patients (.. many children and elderly with limited lung capacity cannot generate enough force to effectively use a dry powder inhaler), they can be significantly more expensive, and globally, they may be out of reach for lower income populations.

With the global inhaler market valued at over $33 billion in 2024, affordability and access are not abstract concerns. In many parts of the world, the cost of switching to “green inhalers” could mean the difference between treatment and no treatment at all. And is it too cynical to believe any such push to switch is driven by the pharmaceutical companies?

A Legal and Policy Path Forward

As an environmental lawyer, I support reducing our environmental impact wherever practical, but not at the expense of human life. The path forward should be pragmatic:

Encourage innovation in propellant technology to create lower GWP (global warming potential) inhalers.
Support research into manufacturing and lifecycle emissions from all inhaler types.
Ensure equitable access to new medical technologies developed in response to environmental matters.
Incentivize proper disposal and recycling of inhalers.
Inhaler technique education to prevent excessive emissions.

The purpose of environmental law is not simply to prohibit; it’s to balance, to harmonize natural environment protection with human welfare. This understanding highlights that environmental laws do not exist solely to forbid harmful activities but to manage the relationship between humans and the rest of the natural world in a sustainable way.

This is not dissimilar from what we discussed in a blog post last year, Eyeglasses versus Emissions: Are We Losing Sight of the Bigger Picture?

It should be lost on no one that last year, even with current inhaler use, more than 3,600 Americans died from asthma.

Breathing Easier

It’s commendable that we’re now scrutinizing every source of emissions, even those from essential medical devices. But we must remember: sustainability is not an absolute value, it’s a shared one. The goal of environmental policy should be to ensure that the planet’s air is clean and breathable for everyone, not to make breathing itself harder for those already struggling. Improving air quality will make a big difference in reducing asthma rates, which means less inhaler use.

Efforts to reduce inhaler emissions are worthwhile, but they must proceed with compassion and science. Environmental progress should not come at the cost of human breath.

Inhalers save lives. The challenge before us is not to stop using them, but maybe to start thinking smarter about how to make them, and how to make the air they protect us from cleaner for all.

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Join us for the next in our webinar series at the Intersection of Business, Science, and Law, “Understanding Stablecoin including as Capital for Your Green Building” this Tuesday, October 14 from 9 – 9:30 am. The webinar is complimentary, but you must register here.

Maryland Should Allow Off Grid Electricity Providers, as Should the Whole Country

By Stuart Kaplow on October 5, 2025 Posted in Climate Change, Codes and Regulations, Energy, Solar Panel

There is no factual dispute that Maryland consumes about 40% more electricity than it generates. That shortfall is not shrinking; it is growing, and the cost of that power keeps rising. We have previously written that Maryland Needs to Produce More Electricity. That imperative is even more urgent as demand spikes from artificial intelligence, electric vehicles, and electrification of buildings.

One elegant solution has just emerged from New England. New Hampshire recently approved HB 672, a remarkably concise one page statute signed by Governor Kelly Ayotte last month. The law cuts through red tape for electricity providers that don’t connect to the existing grid, bringing competition, speed, and innovation into a sector long bogged down by bureaucracy.

Off grid electricity providers in New Hampshire are no longer subject to public utility regulation. This liberates entrepreneurs to develop projects and serve customers directly, without asking permission from state regulators. As Representative Michael Vose, the bill’s sponsor, explained: “New Hampshire welcomes entrepreneurship and innovation in energy.” The data backs this up; studies suggest regulatory hurdles add anywhere from one to five years to projects with multidigit cost multipliers.

The Case for Off Grid Providers

Not just Maryland but the larger U.S. is short on electrons. Welcoming new suppliers means welcoming new ideas for tackling electricity challenges. Imagine a private provider generating power on site from gas turbines, solar arrays, green hydrogen or even a small modular nuclear reactor, and delivering it directly to commercial or industrial customers. Picture data centers, advanced manufacturing facilities or campuses with their own dedicated localized smaller scale electrical system that can power a specific area, unencumbered by decades of entrenched public utility regulation.

Having users respond to their peak load demand helps reduce electricity costs for everyone and those power costs have been increasing dramatically in Maryland and are projected to continue to become larger.

This is what a true free market in electricity could begin to look like.

For over a century, electricity law has been built around the notion of the “natural monopoly.” Dating back to the late 19th and early 20th centuries, policymakers chose to grant utilities monopoly privilege and then regulate them tightly through oversight bodies like the Maryland Office of People’s Counsel, established in 1924 and the oldest of its kind in the U.S. That framework may have been sensible in the age of centralized generation and limited technology. But in 2025, with distributed generation, micro grids, and advanced storage technologies, the natural monopoly assumption is, at minimum, untested.

Regulatory reform since the 1990s has been “re-regulation” more than deregulation. True market competition in electricity has never been tried. Allowing private utilities to develop and compete off grid from generation to supply and even battery storage, is a pragmatic way to break through that barrier without threatening the reliability of the legacy grid.

Why Maryland Should Act

Maryland does not have a viable plan to produce more electrons. Neither the pipe dream of recent legislation expediting the state existing procurement process for renewable energy projects nor the fanciful plan for offshore wind turbines which are at best unlikely to produce electricity in the next decade or at worst simply illusory.

Maryland policymakers should look closely at the New Hampshire model. A modest statutory change, declaring that unconnected private utilities fall outside the jurisdiction of the state’s public utility law, would unleash innovation.

Consider the advantages:

Economic Development Without Subsidies: Instead of tax credits or subsidies, often taken from ratepayers, the state simply allows entrepreneurs to build. If projects succeed, Maryland benefits from new investment and jobs. If they fail, there’s no risk to taxpayers or ratepayers.
Speed to Market: Today, interconnection delays are often measured in years. For fast moving industries, that delay is intolerable. Off grid suppliers can deliver power far more quickly.
Customer Choice & Reliability: Some customers are willing to pay more for dedicated, reliable, or cleaner energy (e.g., hospitals, defense contractors, etc.). Off grid models let them do so.
Environmental Transparency: Grid power is a resource mix, often making environmental attributes hard to pin down. An off grid provider can offer customers clearer guarantees of 100% renewable, low carbon natural gas, or a blended portfolio.
Resilience: Smaller, localized grids and large battery backups may be less vulnerable to cascading outages and peak load shedding, providing redundancy in a time when extreme weather threatens system reliability.

Legal & Policy Perspective

From an environmental attorney’s vantage point, the regulatory question is straightforward: should Maryland continue to rely exclusively on monopoly regulation written in the 1920s, or should it experiment with a new class of providers that the law never contemplated?

The New Hampshire approach is elegant because it does not dismantle the existing regulated grid, it simply allows an alternative to exist. Importantly, the off grid carveout avoids FERC’s complex jurisdictional entanglements and the state’s byzantine approval process, since the new providers are not connected to the interstate grid. That clarity means fewer court fights and faster implementation.

Yes, private grids may carry higher upfront costs. But for many customers, especially those facing steep interconnection charges or who value speed or reliability (including other businesses with equipment that does not respond well to brownouts, load sharing, or demand response), paying a premium makes sense. And many large users in Maryland are already paying that premium including hospitals that have their own generating plants except that today they are connected to the grid.

And as technology evolves, cost curves will invert, making off grid providers even more competitive.

The Bigger Picture

At the societal level, the benefit of competition is not just about today’s electricity mix; it’s about bringing the dynamism of market forces to an industry still regulated like it was 1925, not 2025. Innovation thrives in environments where entrepreneurs are free to try, fail, and try again. An opinion piece in the Wall Street Journal discussing the New Hampshire law used the historic rivalry between Thomas Edison and George Westinghouse to argue that innovation in the electricity industry has come from individuals like those and not from government regulation.

Maryland and the nation should welcome the chance to let private providers operate off grid. The risks are minimal, the upside is significant, and the urgency, given Maryland’s increasing reliance on imported power, is undeniable. With legislation enacted in early 2026, electricity could be produced in 2027.

AI is the Manhattan Project of our generation, and Maryland should not miss out on this opportunity.

Conclusion

Maryland should follow New Hampshire’s lead and allow off grid electricity providers. In fact, every state should. By stepping out of the way and letting innovation flourish, policymakers can accelerate solutions to our electricity challenges without taxpayer subsidies, without adding bureaucracy, and with substantial benefits to consumers.

It is time to modernize electricity law for a modern energy economy.

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Join us for the next in our webinar series at the Intersection of Business, Science, and Law, “Understanding Stablecoin including as Capital for Your Green Building” on Tuesday, October 14 from 9 – 9:30 am. The webinar is complimentary, but you must register here.

EPA Proposes Suspension of Greenhouse Gas Reporting Program

By Stuart Kaplow on September 28, 2025 Posted in Federal, GHG, greenhouse gas

The U.S. Environmental Protection Agency has issued a proposal to eliminate much of the Greenhouse Gas Reporting Program and suspend the remainder until 2034, describing the program’s high compliance costs of up to $2.4 billion annually for businesses with limited resultant regulatory value.

Today, the GHGRP requires more than 8000 facilities across 47 industrial categories to report greenhouse gas emission data. If finalized, this proposal would remove reporting obligations for all facilities except petroleum and natural gas, and those sectors would largely have their reporting deferred until 2034.

What the GHGRP Was

The GHGRP was born from an appropriations directive in which Congress funded the EPA’s development of a rule requiring mandatory reporting of greenhouse gas emissions across the economy. That is, the Consolidated Appropriations Act of 2008 provided $3.5 million to the EPA specifically for the purpose of creating a mandatory greenhouse gas reporting rule without any legislation creating the program.

Finalized in 2009, the new program relied on the Clean Air Act’s information gathering authority under Section 114. Beginning in 2011, more than 8,000 facilities across the country, including power plants, fuel suppliers, and most large industrial facilities, were required to submit detailed annual reports on their greenhouse gas emissions (.. at a cost of tens of thousands if not hundreds of thousands of dollars per facility) if they emitted at least 25,000 metric tons of CO2 equivalent per year.

Although the GHGRP was not itself an emissions reduction program, the vast dataset it generated was used in a range of contexts, having effects far greater than only the 8000 facilities, including the development of later climate policies, such as the methane reporting provisions tied to the Inflation Reduction Act of 2022.

But what might have sounded like a good idea in 2009 does not comport with the statutory framework of the Clean Air Act or today’s public policy priorities. The EPA has concluded that the GHGRP exceeds its authority and imposes burdens that are no longer justified, particularly in light of other mandatory reporting and compliance obligations that already exist under federal law.

The Proposal

This significant development comes in response to President Donald Trump’s Executive Orders 14154, Unleashing American Energy, and 14192, Unleashing Prosperity Through Deregulation, and reflects the EPA’s continued effort to align environmental regulation with statutory authority and current policy.

Under the September 16, 2025, proposed rule:

46 of 47 source categories currently subject to the GHGRP would no longer be required to report greenhouse gas emissions.
The petroleum and natural gas systems category (Subpart W) would largely be repealed as well, except for those segments that Congress explicitly required reporting under Clean Air Act Section 136.
Even for those Section 136 segments, the EPA proposes suspending reporting until 2034, because the Waste Emissions Charge created by the Inflation Reduction Act has itself been postponed until that year.

It is suggested this is a textbook example of regulatory housekeeping: retain only what is required by statute, remove what is not authorized, and suspend obligations that are unnecessary for the foreseeable future.

The Legal Foundation

EPA’s proposal rests on two clear legal bases. First, Section 114 of the Clean Air Act was never intended as a vehicle for comprehensive, economy wide greenhouse gas data collection. Its purpose is targeted, information gathering to support rulemaking and enforcement under the Act. Second, even if the GHGRP were deemed legally permissible, the EPA Administrator has ample discretion to rescind programs that no longer serve statutory or policy needs.

State Level Action: A Complement, Not a Conflict

At least six states have some version of greenhouse gas emission reporting, California, Washington, and Maryland among them. New York is developing one of its own. If states believe data collection is important for their climate programs, they are free to pursue it, and some already are.

This balance, federal streamlining alongside state innovation, is precisely the kind of cooperative federalism the Clean Air Act was designed to promote. The EPA’s proposal respects state autonomy while relieving regulated entities of duplicative federal obligations.

A Deregulatory Action Worth Supporting

The EPA’s proposal to rescind most of the GHGRP and suspend the rest until 2034 is a significant deregulatory action.

You have the opportunity to weigh in during the public comment period, which closes on November 3, 2025.

Of course, the existing rule remains in effect until any change is finalized. It is also possible that environmental groups and local governments could challenge this rule. And this is the type of regulatory action our future president could seek to reimplement.

This proposal reflects not only the current Administration’s view of climate change regulation without express legislative authority but also broader regulatory reform efforts, respecting legal boundaries and cutting red tape. Even those who are not directly impacted by the existing greenhouse gas emission rule should consider the strategic implications of what is proposed and comment.

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Stablecoin to Access Capital to Accelerate Green Building Market Transformation

By Stuart Kaplow on September 21, 2025 Posted in Uncategorized

The U.S. Green Building Council’s LEED green building rating system has long been a bellwether for what voluntary sustainable construction can achieve: healthier indoor environments, less energy use, potable water conservation, waste reduction, reliable power, enhanced security and safety, ecosystem protection, and, in many instances, resulting in economic achievements of lower operating costs and increased property values. USGBC has successfully framed green building not as idealistic ornamentation, but as an investment in environmental protection of people and places, with economic value that rewards performance.

Yet for all of its success, the pace and scale of green building remain insufficient to meet the environmental imperatives we face today, such as air and water quality and biodiversity degradation, its own existential crisis. To truly meet those challenges, we must close the gaps that too often slow green building down: the gaps between sustainable building practice and the finance that enables it. In today’s economic reality, where many government mandates and incentives are being eliminated or reduced if not clawed back, and where physical and transition risks associated with environmental protection have not changed, the availability and cost of capital are major levers.

Many believe that stablecoin, especially under the new GENIUS Act regime, offers a novel tool, if designed and regulated properly, for bridging those gaps. Below, I lay out how stablecoin can serve green building finance, what legal guardrails are emerging, and why this is a moment we should all seize.

What Is the Financing Challenge for Green Building?

Upfront costs & risk: Green building (not just LEED with its large market share, but also the very good Green Globes and the International Green Construction Code and other equivalents) often involves higher first cost construction or retrofit costs, and additional professional fees (e.g., energy modeling, commissioning, etc.). Those costs, plus perceived or real risks (.. whether performance will deliver promised savings), can deter businesses or financiers.
Long-term payoff: Many benefits, energy cost savings, lower maintenance, increased rent, higher occupant satisfaction, health benefits, accrue over time. Construction and initial permanent financing models may undervalue those benefits, or discount them too heavily.
Limited incentives: When today tax breaks and other government incentives and mandates, are being withdrawn, the financial models must stand on their own. In most jurisdictions now, financing terms, interest rates, mortgage underwriting, insurance, etc., are among the most important determinants of whether a building will be green.
Existing Fails: PACE financing, green bonds, and other existing green financing vehicles have failed to provide adequate liquidity and while they can continue to exist, the green building industrial complex must embrace stablecoin or it risks going the way of the dodo bird.
Market transformation required: USGBC’s new guide Green Building & Sustainable Finance: Accessing Capital to Accelerate Market Transformation highlights how voluntary green building rating systems, when integrated into sustainable finance instruments (green bonds, green loans, etc.), help align expectations and validate value, but disappointingly, that just published guide does not even mention stablecoin, in what has been characterized as a blind spot in the legacy green building promoting organizations.

To accelerate transformation, three financial gaps must be addressed: reliable sources of low cost capital; mechanisms for reducing risk so investors will invest; and scalable, liquid instruments so capital can flow efficiently across many projects.

Enter Stablecoins & the GENIUS Act

Stablecoins are, broadly speaking, digital tokens pegged to a stable asset (often the U.S. dollar), designed to reduce volatility relative to many cryptocurrencies. Under the newly enacted GENIUS Act (Guiding and Establishing National Innovation for U.S. Stablecoins Act), the U.S. has created a comprehensive regulatory framework for payment stablecoins.

Key features of the law include:

1:1 reserve backing: Stablecoin issuers must back each token with fully liquid, low-risk assets, typically U.S. dollars or short term U.S. Treasuries.
Transparency & auditing: Issuers will have to disclose reserve composition regularly (monthly) and undergo third party audits.
Consumer protections & legal clarity: For example, stablecoin holders are granted priority claims in insolvency of issuers; prohibitions against misrepresentation in marketing; application of antimoney laundering, sanctions, and similar regimes. )

These features build trust, an essential ingredient if one is going to channel stablecoin denominated or stablecoin facilitated financing into real world infrastructure like green buildings.

How Stablecoins Can Accelerate Green Building Finance

Here are several ways stablecoins could be deployed to help accelerate green building, under the new framework, from this environmental attorney’s perspective.

Lowering transaction friction & cost
Traditional capital flows (loans, bonds, mortgages) are often slow, involve multiple intermediaries, regulatory compliance, bank counterparty risk, currency conversion, etc. A well structured stablecoin payment ecosystem can reduce friction: faster settlement, fewer intermediaries, potentially lower costs of capital for projects that can access crypto native finance or tokenized financing structures.
Tokenization of sustainable finance instruments
Green bonds, green loans, or other sustainable finance instruments could be tokenized, meaning that rights to payments (interest, principal) could be held in digital form on the blockchain, perhaps denominated in stablecoins or integrated with stablecoin liquidity. This opens up possibilities:
- More fractional participation: small investors, or communities, could invest in pieces of green building portfolios.
- Greater liquidity: if tokenized debts are tradable, investors may be more willing to commit capital.
- Faster capital raising: utilizing digital platforms to reach broader pools of capital domestically or globally.
Direct incentive mechanisms
Imagine performance linked contracts where green building project outcomes (energy savings, potable water use reductions, reliable power, occupant health metrics) automatically trigger payments (rebates, bonuses) denominated in stablecoin. Because stablecoin is digital, programmable, and with clear legal rights under the new law, those incentive payments could be delivered and verified rapidly and transparently.
Mitigating climate risk in finance
As physical risks (weather extremes) and transition risks (shifting regulation and energy prices) become more sharply felt, investors require transparency, lower risk, and regulatory certainty. The GENIUS Act gives a framework that strengthens certainty for stablecoin denominated finance, making it easier for financiers to trust stablecoins for capital flows into long lived built environment assets.
Bridging green finance to underserved markets
Many smaller developers, especially in existing older cities or perhaps in places where traditional banking access is limited, are excluded from large green bonds or bank loans. Stablecoin based platforms could offer alternative fundraising models, crowdfunding, peer to peer, or community investment platforms, where small investors fund green retrofits, resilient housing, or energy efficiency projects, with stablecoin facilitating payments and transfers.

Legal & Regulatory Considerations – What Must Be Guarded

As with any financial tool, risks and missteps should be anticipated and mitigated. The following legal guardrails may be desirable:

Full reserve integrity & auditability: The law’s requirement for 1:1 backing and monthly audited disclosures is critical. Without that, stablecoins risk loss of trust or failure, which would be disastrous for green projects with long lives and physical risk.
Clear contractual rights for holders: In real estate finance, things like priority in insolvency, enforceability of payment rights, clarity on redemption rights, jurisdiction, applicable law, all these must be clear. The GENIUS Act helps, particularly with priority of holder’s claims, but project contracts and financing documentation must be drafted carefully.
Regulatory consistency & compliance cost: State versus federal regimes must align (.. but importantly, there should be state stablecoin regulatory regimes), compliance costs must not become so large as to nullify the financial efficiencies that stablecoins are supposed to deliver.
Environmental performance verification: If stablecoin based financing is used for green building, there must be reliable measurement, verification, and reporting of sustainable outcomes. LEED, Green Globes and other rating systems play a central role here.
Managing climate and transition risk: Projects should include risk mitigation for weather events (e.g., flooding, temperature extremes, etc.), adaptation, and resilience; and transition risk (regulation changes, energy price changes) can be built into financial models.

The GENIUS Act & Stablecoin as an Enabler of Market Transformation

With the GENIUS Act now in law, the U.S. has laid foundational guardrails that can give stablecoins legitimacy and trust.

Some observable signals:

The Treasury Department has opened a public comment period to convert the GENIUS Act into implementing regulation, and yes, most support regulation “lite.”
Regulators are clarifying what reserve asset custody, disclosures, and issuer licensing will look like.

These developments reduce regulatory uncertainty, one of the biggest risks for investors and developers in green building. As that uncertainty drops, more capital will flow if market actors believe stablecoins can function as trusted mediums of exchange, store of value, or denominated asset in sustainable finance.

Looking Forward: What Success Could Look Like

If all goes well, here’s what we might see in a few months:

Green Building Token Funds: Portfolios of LEED, Green Globes, and equivalent certified buildings financed via tokenized green bonds or stablecoin denominated debt, with minor investors participating across geographies.
Performance-based stablecoin incentives: Programs where energy savings or emissions reductions trigger automated bonus payments in stablecoin, reducing measurement lag and incentive friction.
Lower cost of capital for green building: Lenders recognizing lower risk in green certified buildings may be willing to offer favorable terms (interest rate and loan to cost) when stablecoin finance reduces transaction or currency risk.
More resilient built environment: Projects are better able to finance adaptation and resilience measures (flood protection, power backup, enhance security and safety, etc.) because capital is more flexible and more trusted.
Democratization of green building finance: More projects in underserved or marginalized communities accessing capital thanks to new platforms, including nonbanks enabled by stablecoins and digital finance.

Conclusion

We are witnessing the dawn of a new financial era, one in which the blockchain’s transparency, stablecoin’s liquidity, and green building’s promise converge. This moment doesn’t belong only to fintech or to environmentalists; it’s a hybrid solution to a breadth of problems faced by every person with a roof over their head.

With the GENIUS Act, America can lead in both clean technology and financial innovation. For building owners, developers, investors, and green entrepreneurs, the message is clear: Sustainability is no longer a sunk cost; it’s a frictionless tradable asset.

Done right, stablecoin enabled finance could help us scale the transformation of the built environment to the speed and scale the natural environment requires. And as an environmental attorney, I am hopeful that this law, together with wise contracting, robust rating, and accountability, will help close the financing gaps, protect people and places, and turn the voluntary green building vision into the norm rather than the exception.

Note, the content above has been generated by an artificial intelligence language model transcribing and combining my comments as a guest on a podcast last week. My words may not be entirely error free, and should you have questions, please reach out to me or seek advice from an appropriate professional.

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EPA is Retaining the CERCLA Hazardous Substance Designation for PFAS

By Stuart Kaplow on September 14, 2025 Posted in Codes and Regulations, Environmental, Federal

On September 17, 2025, the U.S. Department of Justice submitted a court filing on behalf of EPA as part of ongoing litigation related to the designation of perfluorooctanoic acid (PFOA) and perfluorooctanesulfonic acid (PFOS) as Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA or Superfund) hazardous substances.

In the Wednesday court filing, the EPA said it “has reviewed the underlying rule and has decided to keep the rule in place.” That is, the agency is currently retaining the rule that became effective on July 8, 2024.

That is, at this time, EPA is retaining the Superfund) hazardous substance designation for PFOA and PFOS and announced it will be initiating future rulemaking to establish a uniform framework governing designation of hazardous substances under section 102(a) of CERCLA moving forward.

CERCLA imposes broad, retroactive, and potentially costly strict liability on those who released hazardous substances to the environment. This liability can attach to entities that did not manufacture or generate the substance but received it in real estate purchases, feedstocks, products, or waste. Such entities are sometimes referred to as “passive receivers.”

As the agency implements the 2024 rule, EPA will continue to collect information on its costs and benefits. The best, most enduring solution to this issue is a statutory fix to protect passive receivers from liability, which EPA would follow to the letter of the law.

This subject is not easy. We blogged PFOA and PFOS Now Hazardous Substances Under Superfund Law, where we pointed out, “this is a true bete noire where a peer reviewed 2020 study cited approvingly by the EPA describes 99.7% of Americans having detectable PFAS in their blood!” That is, PFAS is so widespread, okay, locking the barn door after the cow has bolted, the solutions are hard to find.

Similarly, we blogged approvingly some weeks ago, EPA Will Keep Current Limits for “Forever Chemicals” in Drinking Water.

On a related, but different matter, while the text is not yet available, currently under review at the Office of Management and Budget is a draft proposed rule that could dramatically reduce the scope of the PFAS reporting rule under Section 8(a)(7) of TSCA.

With respect to this action, the court filing also indicates the court case, filed in the U.S. Court of Appeals for the D.C. Circuit, will now continue, with a tentative new hearing schedule due on September 30.

This act of retaining the current rule is not an abdication of responsibility, but rather a recognition that effective environmental governance depends on both the right ends and the right means. Environmental public policy is hard.

This post was updated on September 18, 2025.

When Less Regulation Means Better Outcomes: EPA’s Poultry Effluent Rule Withdrawal Explained

By Stuart Kaplow on September 7, 2025 Posted in Codes and Regulations, Federal

As environmental attorneys, we are often asked to assist clients in the balance between environmental protection, regulatory authority, and the broader socio economic impacts of government decisions. The U.S. Environmental Protection Agency’s September 3, 2025 withdrawal of its proposed rule revising “effluent limitations guidelines” for the Meat and Poultry Products point source category, in support of the National Pollution and Discharge Elimination System permits program, is a prime example of the Agency exercising its statutory discretion under the Clean Water Act in a way that supports both environmental law and urgent national policy priorities.

Legal Authority and Discretion under the Clean Water Act

The Clean Water Act empowers EPA to establish technology based effluent limitations that reflect the “best available” pollution control technologies for industries that discharge into waters of the U.S. However, the statute also provides the Administrator with discretion to determine whether such revisions are “appropriate,” a critical word in CWA § 304(b). The law expressly requires EPA to consider not only technological feasibility and cost, but also “such other factors as the Administrator deems appropriate.”

Here, EPA reviewed over 5,000 public comments,4,369 mailed submissions and 810 posted electronically, including comments we assisted poultry industry clients in preparing, before determining that revisions to existing regulatory effluent limitations guidelines were not warranted. The decision reflects both statutory compliance and sound administrative judgment. Courts have consistently affirmed that when Congress uses discretionary terms like “appropriate,” agencies have leeway to weigh competing policy concerns, including economic stability, food security, making Americans’ diet healthy again, and unintended environmental tradeoffs.

Why the Withdrawal Matters

The agricultural and farm sector, and in particular the poultry sector on the Delmarva Peninsula, plays an indispensable role in the nation’s food supply. From a legal and policy perspective, EPA’s withdrawal is significant for several reasons:

Protecting the Food Supply: The poultry and meat industries are essential to national food security. In the aftermath of the COVID-19 pandemic, ongoing avian flu outbreaks, and supply chain disruptions, EPA recognized that layering new effluent regulations onto this already stressed sector could destabilize production at a time when MAHA has federal agencies working with farmers to ensure the U.S. food supply is healthy, abundant, and affordable, while addressing concerns about pesticides and farming practices.
Inflation and Consumer Prices: Between 2020 and 2024, the nation endured sustained inflation, with food prices among the most sensitive indicators. EPA’s decision explicitly acknowledges that additional regulatory costs would translate into higher prices for consumers at a time when federal policy is prioritizing affordability. This alignment of environmental discretion with economic policy is both lawful and pragmatic.
Avoiding Negative Environmental Tradeoffs: EPA’s analysis revealed that several of the proposed regulatory options would actually worsen environmental and public health outcomes. Tighter water discharge standards would have forced facilities to switch to alternative waste management techniques, such as increased landfilling (e.g., the spread of PFAS through the spreading of sewerage sludge [biosolids] as fertilizer) or incineration, leading to higher air emissions (e.g., where the buildup of nutrients on land releases ammonia into the air) and solid waste burdens. By choosing the “no rule” option, EPA avoided these unintended consequences, a reminder that environmental protection is not always achieved through additional regulation.
Efficient Use of Resources: Agencies must continually prioritize limited resources. Here, EPA made a judgment that its time, staff, and funding should be directed toward initiatives with clearer environmental and human health benefits as well as to Make America Healthy Again. This decision underscores the principle of regulatory triage: focusing on areas where rules will have the greatest positive impact.

Implications for the Delmarva Poultry Industry

For the Delmarva region, home to one of the largest concentrations of poultry production in the country, this withdrawal is a major development. The industry not only supplies Maryland, Delaware, and Virginia, but much of the East Coast with affordable protein but also supports tens of thousands of jobs across farming, processing, transportation, and retail. Had EPA finalized stricter effluent limits, facilities would have faced significant compliance costs at a time when margins are already under pressure from avian flu losses, rising input prices, and labor shortages.

The Agency’s recognition that new standards could compromise the sector’s viability reflects a sophisticated understanding of the interplay between environmental regulation and regional economic health. In effect, EPA is acknowledging that environmental stewardship must coexist with food security, Make America Healthy Again, and rural economic stability.

A Responsible Exercise of Discretion

Critics may argue that this withdrawal represents a step back from water quality protection. But that view ignores two crucial facts:

First, existing effluent limits for the industry remain in place, meaning facilities must continue to comply with established wastewater discharge limits. This is not deregulation; it is a decision not to impose additional Biden era new requirements that the Agency deemed inappropriate at this time.
Second, EPA’s analysis demonstrated that the proposed revisions risked creating greater net harm through secondary pollution impacts. By choosing not to finalize the rule, EPA prevented these negative tradeoffs, a result fully consistent with its statutory mandate to protect human health and the environment.

Conclusion

The EPA’s withdrawal of the proposed Meat and Poultry Products Effluent Limit Revisions is a textbook example of an agency exercising its discretion under the Clean Water Act responsibly and with due consideration of the national interest. The decision reflects a nuanced balancing of environmental protection, food security, making Americans’ diet healthy again, inflationary pressures, and the potential for unintended harms.

For stakeholders, including those in the Maryland, Delaware, and Virginia poultry industry, this action provides much needed regulatory certainty and relief at a time of profound external pressures. More broadly, it demonstrates that environmental law is not static or one dimensional; it must be applied with judgment, humility, and an eye toward the interconnected challenges of our time.

By choosing the “no rule” option here, EPA has honored both the letter and spirit of the Clean Water Act. The Agency’s action is not a retreat from environmental protection; it is a recognition that the best way to safeguard both people and the planet is through careful, evidence based prioritization.

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Join us for the next in our webinar series at the Intersection of Business, Science, and Law, “How to Order a Phase II Environmental Site Assessment” on Tuesday, September 16 from 9 – 9:30 am. The webinar is complimentary, but you must register here.