As Portland Continues to Grow, Are We Prepared to Address the Resulting Increase in Emissions?

By Greg Hibbard, Energy Law Fellow

Portland Bureau of Transportation

On June 30th, the popular food carts in the Alder Street pod in downtown Portland were forced to relocate so construction can begin on a new 35-story tower at 900 S.W. Washington St. The building will host a Ritz-Carlton hotel—Portland’s first five-star hotel—in addition to condos and office space. The Ritz-Carlton will include over 350 rooms and condos, eight penthouses, and a swimming pool on the 19th floor. At least a portion of what will become the fifth tallest building in Portland will be constructed using concrete panels. While the Ritz will represent a level of luxury not previously constructed in Portland, the new hotel represents the latest addition to a growing metropolitan area that has seen over 2,000 hotel rooms added downtown in the last 10 years. Because the hotel industry only represents a fraction of the growing city, Portland’s rapid rate of development begs the question of how much environmental harm is being accepted in the name of expansion and luxury.

A recent E&E News story explored the massive carbon footprint of modern structures. The story stated that 11% of global carbon emissions can be attributed to construction. The main emissions culprits, at least in terms of modern structures, are steel and concrete. The manufacturing process for steel involves heating iron ore in a blast furnace, which produces the byproducts of iron and carbon dioxide. According to E&E News, the World Steel Association estimates that producing one ton of steel releases 1.83 tons of carbon dioxide into the atmosphere. That quantity of emissions is equivalent to the emissions that result from a roundtrip drive from New York to Salt Lake City. Similarly, concrete production also generates significant carbon emissions. Producing cement is an interim step of concrete production. Cement is produced by baking limestone, which produces the undesired byproduct of carbon dioxide. One ton of cement results in roughly half a ton of carbon dioxide. According to the International Energy Agency, cement accounts for nearly 7% of global carbon emissions.

E&E News estimates that local governments and mayors have the ability to significantly reduce lifetime emissions for buildings—by up to 44%— by improving energy efficiency and incentivizing the use of greener building materials. The environmental costs of improved energy efficiency warrant a separate discussion. However, energy efficiency is another example of how convoluted emission solutions can be. For example, using triple-glazed windows may appreciably reduce heat loss and conserve energy but they are also more carbon intensive to produce and ship.

With respect to building materials, Portland has already taken strides to ensure that further construction is done in an environmentally friendly manner. For example, through its participation in C40 Cities, Portland joined cities from all around the globe to commit to obtaining the goals of the Paris Agreement. Through its C40 commitment, Portland has pledged to ensure that all new buildings are net-zero carbon by 2030. Portland Mayor Ted Wheeler has shown a personal interest in the C40 initiative, stating that “[e]nsuring Portland’s old and new buildings achieve net zero carbon use is an essential challenge that I am ready to take on.” Unfortunately, Portland’s efforts are inherently limited by state building codes. Portland is preempted from adopting its own building code requirements and must look to economic incentives or other strategies to accomplish many of the goals that Mayor Wheeler wishes to achieve.  

Regardless of what form the city’s policies ultimately take, increasing the use of low-carbon building materials presents an opportunity for Portland to further its goals of constructing net-zero carbon buildings. While buildings such as the future Ritz-Carlton will continue to require concrete and steel in the near future, it is time for Portland to begin looking for greener building options. Although there are currently identified options or alternatives to concrete and steel, such actions also present drawbacks. For example, steel can be produced in a less carbon-intensive manner if hydrogen is used to purify the iron ore rather than coal, but it may take another decade until such technology is readily available on a mass scale. Another potential option is to use different building materials, such as wood, as a substitute for steel or concrete. Even assuming wood is mechanically comparable to steel or concrete, using wood as a primary building material may bring about more environmental questions than answers. Among other issues, increased timber production threatens habitat for certain species and the ability of forests to sequester carbon.

At this point in time, there are no easy answers to the environmental issues posed by steel and concrete building materials. In the very least, we must consider the appropriate questions to address the carbon intensity of the most commonly used building materials. Can we clean up the production processes for steel and concrete? Are there economically and mechanically viable alternatives to building with steel and concrete? And if there are viable alternatives, such as wood, are their potential environmental impacts worth the switch? The forthcoming Ritz-Carlton Hotel in Portland is a sign of continued prosperity in the city. We must be prepared to account for the potential emissions cost of that prosperity.

Supreme Court Doubles Down on Auer Deference: Implications for Future Environmental Regulation

By Greg Hibbard, Energy Law Fellow

One June 26, the U.S. Supreme Court issued an opinion in Kisor v. Wilkie, written by Justice Kagan, upholding a doctrine that provides significant judicial discretion to federal agency decision-making. This doctrine is commonly referred to as Auer or Seminole Rock deference. With a potential dramatic change in administration in the next election, the Court’s decision begs the question of how Auer deference may play a key role in reversing the effects of four years of agency decisions and policies from the Trump Administration. This question is particularly poignant as it relates to the realm of environmental policy, as federal agency discretion plays a key role across the field of environmental law.   

Although judicial deference to federal agency interpretations of their own regulations has roots as far back as 1945, the 1997 Supreme Court decision in Auer is often credited with solidifying the doctrine. Auer deference is similar to that of the more well-known judicial doctrine of Chevron deference. Chevron deference provides that courts will defer to federal agency interpretations of ambiguous statutes, provided that the agency is charged with effectuating the statute and that the agency’s interpretation of the statute is reasonable. In a similar manner, Auer deference allows federal agencies to fill in the gaps of their own regulations—if the regulations are ambiguous (meaning the regulatory text is open to more than one reasonable interpretation)—with their own reasonable interpretations. While the Kisor decision does not directly implicate the future of Chevron deference, it may provide a signal for how the justices will vote if that issue is brought before the current Court.

In Kisor, the Court considered whether to put an end to Auer deference. The Court reviewed the doctrine in the context of a Department of Veteran Affairs (VA) decision to deny a Vietnam War veteran certain benefits associated with post-traumatic stress disorder. In this specific case, plaintiff Kisor was initially denied benefits in his 1982 application to the VA based on a psychiatric report that found he was not suffering from PTSD. In 2006, Kisor reopened his claim. This time, the VA agreed to provide benefits, in part, because of a new psychiatric report that concluded he was suffering from PTSD. However, the VA interpreted its regulations as only requiring the agency to provide benefits from the date of his reopened claim rather than his initial claim, as the plaintiff had requested.  The lower courts employed Auer deference to uphold the VA decision. All nine Supreme Court Justices agreed with the ultimate judgment to remand the case to the lower court to determine if Kisor should have been granted the benefits in question. However, the justices split along ideological lines when deciding whether to overrule Auer deference. With Chief Justice Roberts providing the swing vote, the doctrine survived with a 5-4 decision. Chief Justice Roberts, Justice Gorsuch, and Justice Kavanaugh each wrote separate concurrences to address the continued use of Auer deference.

Opponents of the Auer doctrine, including Kisor, argue that the doctrine provides an incentive to agencies to issue ambiguous regulations and then later impose interpretations on parties without satisfying the requisite notice and comment procedures. Additionally, Kisor also argued that Auer deference violates the separation of powers protected under the Constitution by granting an inappropriate degree of legislative and judicial function to the executive branch. Justice Gorsuch, appearing to side with Kisor, penned an impassioned concurrence and argued that “[i]t should have been easy for the Court to say goodbye to Auer.” However, Justice Kagan and the majority shot down each argument by emphasizing that certain limitations to the doctrine’s applicability will keep the agency discretion appropriately in check. Some scholars claim that Justice Kagan’s articulation of the doctrine will substantially restrict its application, while others maintain that Justice Kagan merely acknowledged limitations that were previously recognized by the Supreme Court.

While Justice Kagan highlighted multiple limitations of Auer deference, two are particularly noteworthy. First, the majority stressed that in order for an agency to receive deference, its interpretation must represent “fair and considered judgement.” This limitation prohibits courts from providing deference to agencies for convenient litigation positions or post hoc rationalizations. Second, Auer deference must also be applied in a manner that ensures that regulated parties are not met with the unfair surprise of a new interpretation. The majority explicitly noted that the Court has “only rarely given Auer deference to an agency construction conflicting with a prior one.” Therefore, if a new democratic administration retakes the White House in the next election, it will likely be limited in how drastically it can reinterpret regulations in place from the Trump Administration. A new administration would instead likely have to revise Trump Administration regulations through the lengthy notice and comment process.

This dynamic is especially important in the context of the environment. The Trump Administration has made a concerted effort to weaken environmental regulations. If a more environmentally conscious administration takes the reigns after the election, it will remain an uphill battle to re-establish a proper environmental regulatory scheme. Because Auer deference does not necessarily support abrupt changes in regulatory interpretations, a potential democratic administration may have to work with Trump Administration regulations longer than desired until they are replaced.

Discretion can, in many ways, be a double-edged sword depending on whether you agree with the party wielding it. If President Trump wins reelection, continued discretion will likely provide more risk to the environment. However, if a democrat wins the next election, the Kisor decision could turn out to be a big win for the environment. Once President Trump’s regulations are replaced, a new administration would be able to take advantage of Auer deference to fill regulatory gaps without always referring to more lengthy administrative processes. Further, the Kisor ruling appears to signal that Chevron deference will remain available to federal agencies.  While it may be difficult at first, the Supreme Court’s ruling in Kisor should be a key factor in agency efforts to heal and protect our environment in the years to come.