Diving deep into Redwater – Supreme Court Says Trustee in Bankruptcy can’t cherry pick Environmentally Clean Assets

Written by John Stefaniuk and Scott Birse, Thompson Dorfman Sweatman LLP

The Supreme Court of Canada released its much anticipated decision in Orphan Well Association v. Grant Thornton Limited (a case more commonly known as Redwater) on January 31, 2019. You might recall our article on the Alberta Court of Appeal’s decision in the same case.

In Redwater, the courts had to decide whether bankruptcy law trumped provincial regulatory orders issued in Alberta. Redwater Energy Corporation (Redwater) was an oil and gas developer.  It held a number of development properties under the authority of the Alberta Energy Regulator (AER).  With the slump in oil prices, Alberta Treasury Branches (ATB), Redwater’s primary lender, called its loan. ATB appointed Grant Thornton Ltd. first as receiver and subsequently as trustee in bankruptcy of the estate of Redwater under the federal Bankruptcy and Insolvency Act (BIA).

In the course of examining Redwater’s realizable assets, Grant Thornton became aware of outstanding environmental reclamation obligations that were associated with some of Redwater’s non-producing properties.  Grant Thornton decided to put the valuable, producing wells and other “clean” assets up for sale, and to walk away from the remaining assets by renouncing them under the BIA. That resulted in putting the reclamation in the lap of the Orphan Well Association (OWA), an industry-funded organization set up in Alberta to administer a fund established for the purpose of reclamation of “orphan” properties.

The AER refused to allow the transfer of the productive licences. It issued abandonment orders requiring clean-up or posting of security for clean-up costs in relation to the renounced assets. The parties headed to court to see what would become of the value that could be realized for the retained assets. Both the trial court and the Alberta Court of Appeal would have allowed Grant Thornton to leave the liabilities behind.

In the majority decision written by Wagner C.J., the Court applied a three-part test found in another Supreme Court of Canada case decided in 2012, Newfoundland and Labrador v. AbitibiBowater Inc. The majority of the Court held that the reclamation claims were not  a debt, liability or claim owing to a creditor and that they were too remote to attach a monetary value. That meant that two of the three criteria in the Abitibi test were not met. The Court therefore held that the bankruptcy did not have the effect of undoing the orders and the trustee could not cherry-pick the valuable assets while renouncing the rest.

This was a bit of a surprise to many environmental law practitioners, including most of the ones I attended a conference with just a few weeks prior to the decision.

What then, is the upshot?

Ostensibly, this is good news for provincial regulators. It is more likely that their enforcement orders will be found to continue to be binding upon corporations in bankruptcy. While it does not make receivers or trustees in bankruptcy personally responsible for rehabilitation costs, it does mean that the proceeds of sale of the valuable assets may have to be put toward satisfying those orders before any of it is available to lenders and other creditors. That means less costs potentially borne by the provinces (and their taxpayers). Predictably, lenders do not seem to garner a lot of public sympathy.

On the other hand, (assuming no changes to the BIA) the decision means that lenders and other creditors will have to pay closer attention to the borrower’s unfunded clean-up and closure costs when extending and monitoring credit. If the lender no longer has the ability to deal with valuable assets and leave the “dirty” behind, it means that credit in environmentally sensitive sectors may become tighter, reporting requirements may become more onerous, and some lenders may become skittish.

The dissenting minority decision written by Côté J. said the majority decision was not based on “polluter pays”, but instead resulted in a regime of “lender pays”.  After all, it is always open to the provinces to require permittees and licensees to post better (and more) security to fund rehabilitation costs, and to carry out better monitoring and inspections to ensure that the security is really adequate to fund clean-up. On top of that, who is in a better position to monitor environmental compliance and reclamation costs, the regulator or the bank? Surely, the regulators have better expertise and, assuming proper funding from government, better resources to carry out the work. Indeed, the regulators also wield the bigger stick – fines and penalties – whereas the most that the lender can do is either refuse to lend, lend less, or call in a loan where potential trouble is spotted. By the time that issues are obvious, the lender may choose to let things ride, so long as payments are being made, rather than force a realization that could put its security at risk. It is difficult to see how that serves environmental protection.

In some respects, the decision can be seen as a bit of a “Get out of Jail Free” card for the provinces and their resource and environmental regulators. No doubt that is the way that ATB felt about it.

This article has been republished with the permission of the authors. It was first published on the TDL Law website.


About the Authors

John Stefaniuk engages in a broad practice with emphasis on environmental law, real estate and development law, natural resources and energy, commercial law and municipal law matters. He has particular experience in relation to contaminated sites, mining and mine rehabilitation, wind power development, natural resource development, environmental approvals and licensing, commercial real estate, leasing, financing and development, municipal approvals, taxation and assessment and business acquisitions. He appears regularly before government licensing bodies and administrative tribunals including the Manitoba Clean Environment Commission and Municipal Board, municipal councils, provincial legislative committees and in all levels of court in Manitoba and in the Federal Court in connection with environmental, resource, regulatory municipal, and property issues.

Scott Birse has a broad practice with a particular emphasis on environmental law, municipal law, real estate and development law, regulatory compliance, commercial law and related litigation. He has particular experience assisting clients in the areas of environmental liability in real estate transactions and business acquisitions, municipal planning and approvals, contaminated sites liability, environmental assessments, commercial real estate development and civil litigation. Scott has appeared before municipal tribunals, the Manitoba Court of Queen’s Bench and the Manitoba Court of Appeal. He has also advised clients with respect to municipal and environmental matters in Saskatchewan and British Columbia.

Global Crisis, Emergency and Incident Management Platforms Market 2019

Persistence Market Research recent market report on Global Crisis, Emergency and Incident Management Platforms estimates that it will be worth $102 billion (USD) by the end of 2024.

A 2017 market analysis by Persistence Market Research on the market in North America predicted the year-over-year growth the Global Crisis, Emergency and Incident Management Platforms to increase at a CAGR of 7.2%. through to 2023. The 2017 report estimated that the North America market accounted for a relatively high market share and be valued at more than US$ 20 Billion in 2017. The report estimated that the North American regional market would continue to remain dominant in terms of value during the forecast period (2017 – 2024).

The latest market report from Persistence Market Research predicts that the global market or crisis, emergency & incident management platforms will be fragmented across various systems and platforms. Among which, the demand for web-based emergency management software, geospatial technology, emergency notification system, hazmat technology, seismic warning systems, and remote weather monitoring systems is expected to gain traction throughout the forecast period. These systems are also predicted to be demanding greater incorporation of communication technologies. Through 2024, satellite phone, vehicle-ready gateways, and emergency response radars will be the most dominant type of communication technologies used in working of any crisis, emergency & incident management platform.

Likewise, the report also expects that during the stipulated forecast period, professional services such as consulting and emergency operation center (EOC) design & integration will be in great demand. By the end of 2024, crisis, emergency & incident management platforms will be actively adopted across industry verticals such as BFSI, energy & utility, government & defense, and telecommunication and IT.

A regional analysis of the global crisis, emergency & incident management platform market indicates that North America will dominate by accounting for over US$ 36 Billion revenues by 2024-end. Adoption for such platforms will also be high in Asia-Pacific, and the region is expected to showcase a 6% value CAGR.

Leading providers of crisis, emergency & incident management platforms in the world include Honeywell International, Inc., Lockheed Martin Corporation, Motorola Solution, Inc., Rockwell Collins, Inc., Siemens AG, Iridium Communication Inc., Guardly, Environmental System Research Institute, Inc., and Intergraph Corporation.

U.S. Opportunity: U.S. ITRC Issues RFP for 2020 Technical Projects

The United States Interstate Technology and Regulatory Council (ITRC) recently issued a Request for Proposals (RFP) for projects that address urgent environmental issues and advance innovative technologies and processes. The proposals that are selected by the ITRC Board of Advisors will begin in January 2020.

All applicable environmental topics will be considered, but evaluation criteria will give greater weight to proposals that address the needs listed in the 2020 ITRC Priorities list, or proposals which update ITRC documents that are outdated. Existing ITRC documents can be found here.

More information about the Project Proposal Process is available here. Please follow the instructions found in the selection process and criteria document, and use the proposal template to submit your proposal.

The ITRC Board of Advisors will conduct a preliminary evaluation of all proposals received by the deadline and in the proper format. The purpose of this preliminary evaluation is to determine what needs to be clarified during the Board interview on May 23, or to determine if a proposal should not move onto the next step in the evaluation process.

The Board will use the following criteria:

  • Is the proposal consistent with ITRC’s mission, goals, and strategic planning objectives?
  • Does the proposal address regulatory or technical barriers (which includes lack of awareness or lack of educational resources) to environmental solutions?
  • Does the proposal address a need of a broad spectrum of groups/states? Is the proposed guidance and training likely to be used by a large number of people, even though the subject may not have a high level of current interest? (e.g. passive sampling, ISM, GW statistics)
  • Is the problem/subject to be addressed clearly defined?
  • Does the project have a defined and manageable scope?
  • Does the proposal have the support of at least five states to be implemented, with two state personnel (with accomplished project management skills and a working knowledge of the subject matter) as potential Team Leaders?
  • Does the proposal consider the requisite subject matter expertise within its team composition?
  • Does the project propose the development of tools which are functional, educational, and able to address the needs of a varied audience?

2020 ITRC Priorities (see the expanded list here) include water reuse, waste reduction, chemicals of emerging concern, cleanup technology, water quality, and air quality.

Proposals are due electronically to the ITRC Director (preyes@ecos.org) by Wednesday, May 10, 2019. Proposers are reminded to review the evaluation criteria and present a proposal that is technical in nature, not policy-oriented, nor a research or demonstration project. All questions should also be addressed to Patty at preyes@ecos.org.

Quebec to Track Contaminated Soil Movement in Real Time

The Quebec Government recently announcement that it will adopt the regulation that will include the implementation of a system in which the movement of contaminated soil will be tracked in real time. Under the tracking system, the site owner, project manager, regulator, carrier, and receiving site, and other stakeholders will be able to know where contaminated soil is being shipped from, where it’s going, its quantity and what routes will be used to transport it.

Contaminated soil will be tracked in real time, starting from its excavation, through a global positioning system. The system, Traces Québec, is already in place in Montreal as part of a pilot project launched last March.

Traces Quebec , an initiative of Réseau Environnement in partnership with WikiNet , offers the first integrated traceability solution for contaminated soils in Quebec. Performing on a web platform, the Traces Quebec traceability system allows contaminated soil owners to follow in real time the movement of their materials and to have an encrypted, confidential and archived trace of the displaced materials. In an era of transparency and eco-citizenship, Traces Québec allows contaminated soil owners to demonstrate beyond any doubt their exemplary management of these materials.

Combining the Internet of Things (IoT) and artificial intelligence, Traces Quebec is an independent application that allows complete traceability of materials to their destination. Transactions are encrypted, unalterable and private, and compatible with smart phones and conventional GPS fleet systems.

With a system such as Traces Québec, all players in the field in Quebec will benefit from increased traceability and responsible management of transported excavated materials, particularly treatment, transfer stations and landfills, which will increase the volume materials shipped to their sites. Owners of these materials concerned with their good management, including municipalities, will also come out winners and can easily testify to their good management. Management in compliance with the laws and regulations concerning the protection of the environment; this is the essential contribution of Traces Québec.

The Quebec government also intends to increase he number of inspections on receiving sites. Furthermore, fines will be increased for those taking part in illegal dumping — from $350 to $3 million depending on the gravity of the offence, the type of soil and if they are repeat offenders, among other criteria.

How the GPS tracking system works

Investigation finds Contaminated Soil from Montreal is being dumped on Prime Farmland

As reported by Marie-Maude Denis and Jacques Taschereau of CBC News, contaminated soil generated from the development of properties in Montreal is ending up on prime agriculture land.

Radio-Canada’s investigative program Enquête recently tracked demolition waste from Montreal sites to farmland in Saint-Rémi. When the investigators confronted the farmer, he claimed the material dumped on his property would be used as a foundation for a greenhouse and that it was legal.

An environmental lawyer contacted by the Radio Canada investigators disagreed with the farmer as did Quebec’s Environment Ministry. The Environment Ministry confirmed it found contaminated soil at the site last year, but it’s offered no further details about its origin, saying the matter is still under investigation.

When The Radio Canada investigators questioned the general contractor working on the site that was the source of the contaminated soil, he claimed the a subcontractor properly trucked the soil away.

Properly managed soil treatment facility

The claim of the general contractor and farmer is that the material is construction debris consisting mainly of bricks and stones and not contaminated soil. The investigators noted that the material they saw dumped on the farm included metal and concrete. According to the Environment Ministry, the kind of debris that was tracked by the investigators can’t be legally be use for the intended farmland construction.

In a similar investigation conducted by Radio Canada in 2016, investigative reporters followed trucks and observed debris being dumped in the countryside. The investigators arranged for the sampling and analysis of the soil from several farms and that found some samples to be contaminated.

New Cleantech innovations reduce emissions from vehicles and suppress dust at industrial sites

dynaCERT Inc and H2 Tek have taken home the $5,000 top prize at the Mining Cleantech Challenge in Denver, the Colorado Cleantech Industries Association (CCIA) has reported.

The two companies’ technology were chosen by mining executives and investors in the industry as the best among a competitive field of 12 total companies representing the US, Canada and Israel, the CCIA said. An international team of judges reviewed and voted on the winners, the CCIA said.

dynaCERT’s HydraGEN™ turns distilled water into H2 and O2 gases on-demand and introduces these gases directly to diesel engines’ air intakes. H2 Tek Vice President of Sales and Marketing, David Van Klaveren, said: “Our technology, HydraGEN can actually improve significantly those carbon emissions, reduce them and, along the way, pay for the capital cost of all this through fuel efficiency savings.

“We can’t ignore the fact that clean technology is an important part of our responsibility as participants and members of this industry, the mining industry,” he said. “I think it’s remarkable that an association considers this a priority: bringing together companies that have innovation for an extremely important cause.”

Hydrocarbons and CO2 are reduced due to the absence of carbon in hydrogen fuel and also due to better combustion of diesel fuel with the aid of hydrogen which has a higher flame speed, dynaCERT said.

“Although CO values for neat diesel operation is relatively lower, by inducting H2 & O2 into diesel the CO amount is further reduced,” dynaCERT said. dynaCERT has created partnerships to perfect a technology that would deliver on the promising findings with H2 & O2 injection. Not only have we developed patent-pending technology, we have completed testing and have validated that our technology works.”

Some of the features delivered through the technology, dynaCERT said:

  • “Our patent-pending electrolysis system and Smart ECM provides a reliable and adjustable delivery of H2 & O2 concentrations. Not all engines are the same and having the optimal ratio of gases provides increased benefits;
  • “Our technology is scalable allowing use with Class 6-8 on-road vehicles and transition to applications with rail, marine, off-road and power generation;
  • “Our technology is leading edge and provides solutions without drawing excessive power to perform the task;
  • “It is designed to work with OEM manufacturer’s and compliment technological improvements.”

Earth Alive Clean Technologies

Second place in the cleantech competition went to Earth Alive Clean Technologies, a microbial dust control technology that is non-hazmat, 100% organic and has biodegradable properties.

Earth Alive offers EA1TM dust suppressant and RapidAll cleaner to remove dust, dirt and any other contaminant in a natural way. EA1 eliminates 90% of dust on work sites.

EA1TM reduces dust through the use of microbial technology to keep dust particles in the soil. EA1TM reintroduces natural microbial strains compounds already found in nature into the ground to create conditions that prevent dust from becoming airborne, while helping to retain soil moisture. Microbial spores are activated after application and thrive in the soil binding soil particles and creating a firm and resistant layer preventing dust emission.

Hazardous industry leaders give insight on the keys to operational excellence

A global survey of hazardous industries and Operational Index was recently published by Sphera. The annual Operational Excellence Index (OEI) survey report which highlights trends in digital transformation and OE strategies across the hazardous industries.

Previously conducted by Petrotechnics, now a Sphera company, the index is in its third year of surveying oil and gas, chemical, energy and industry manufacturing professionals to gauge attitudes around OE and the measures taken towards its adoption. Year after year respondents agree, OE programs help reduce risk, cut costs, and improve productivity. The 2018/2019 survey reveals senior leaders are relying on technologies to support their OE initiatives and identifies where they are coming up short and what they could do to improve.

Ninety percent of respondents agree digital transformation will accelerate their ability to achieve OE – not just as a one-off target but as an ongoing business objective. This is a significant increase from last year’s report where 73% of leaders agreed that going digital was key to achieving OE. Implementing digital technologies is now aligned with overall business goals with 55% leveraging technology to reduce operational risk and 55% to improve asset availability and uptime.

Paul Marushka, President and CEO at Sphera, commented, “As the third-annual Operational Excellence Index shows, digital transformation is upon us. As companies look for new ways to keep their people safe, their operations productive and their products sustainable, being able to tap into and monitor data from Industry 4.0 solutions will be a major differentiator for organizations looking to separate themselves from the competition. It’s not surprising that 90% of respondents agree that digital technology will accelerate operational excellence. We couldn’t agree more. Sphera believes digital is the wave of the future for operational risk mitigation.”

But while industry leaders agree digital is essential to OE, more than half are still trying to figure out what ‘digital transformation’ means for them, and 69% are just beginning their digital journey. The approach to digital matters, according to 83% of survey respondents, who admit they have relied on legacy systems to improve their business agility but had not embedded operational best practices cross-functionally.

The good news is the industry is on the brink of a major step forward when it comes to achieving OE through digitalization. Seventy-five percent of leaders recognize the need to create new, insight-driven business processes across enterprise functions. Advanced analytics and digital twins were highlighted as key solutions to help operators understand how to make better, safer planning and operational decisions. 

Scott Lehmann, VP, Product Management, ORM for Operations at Sphera, said, “This year’s survey clearly illustrates the challenges digital leaders face within their own organizations to understand what digital transformation means or could mean practically and tangibly to their company. While the pace of digital transformation and ROI is still in its early days, the survey points strongly to a rapid acceleration on the horizon. Digital leaders understand digital integration and the adoption of new technologies must focus on creating actionable insights to help underpin new cross-functional business processes that enhance decision-making and the way people work together.”

One survey respondent suggested: “The best approach to digital is not to use technologies to close gaps that you know already exist. Rather, start with a blank sheet of paper and define what you need – and then assess the available technologies.”

Petrotechnics, now a Sphera company, conducted the survey between October and November 2018, collecting 116 responses from a broad representation of functions, demographics and industries across the hazardous industries, including: oil, gas, chemicals, manufacturing, utilities, mining, engineering and other sectors. The survey included respondents from each major region – specifically Middle East (29%), Europe (28%), North America (28%), Asia Pacific (11%), Africa (3%) and South America (1%).

View the full report and results from the 2018/2019 Operational Excellence Index.

Canada: New Environmental Emergency Regulations Published

New regulations

The Environmental Emergency Regulations, 2019 (the final regulations) were recently published in the Canada Gazette. They come into force on August 24, 2019, and until then, the Environmental Emergency Regulations (first published in 2003) are in force.

The objective of the Environmental Emergency Regulations, 2019 (the final Regulations) is to further enhance environmental emergency management in Canada. For instance, improved environmental emergency management has been introduced through the addition of hazardous substances to Schedule 1 of the Regulations. This addition requires reporting on these substances, environmental emergency planning for higher-risk facilities, and reporting of environmental emergencies involving these substances.

In addition, the final Regulations aim to clarify and strengthen existing regulatory requirements and to ensure that the information available to public safety organizations and the Department is reliable, in order to help in minimizing the frequency and consequences of environmental emergencies in Canada and further enhance environmental emergency management in Canada.

The government estimates that the final Regulations implicate an additional 200 businesses, along with the existing 4 800 regulated parties across Canada. Of these facilities, approximately 3,000 will be required to prepare, implement, exercise and update environmental emergency (E2) plans.

Application

These regulations require that any person who owns, has the charge, management or control of a regulated substance at or above certain quantities notify Environment and Climate Change Canada (ECCC). For higher-risk facilities, an environmental emergency plan must also be prepared, brought into effect and exercised.

Under section 193 of CEPA 1999 an environmental emergency means an uncontrolled, unplanned or accidental release, or release in contravention of regulations or interim orders made under Part 8 of CEPA 1999, of a substance into the environment; or the reasonable likelihood of such a release into the environment.

Hazardous substances

Schedule 1 of the final regulations includes 249 substances that pose an acute hazard to the environment or to human health should an accidental release occur. There are six  hazard categories covered under the final regulations:  

  • aquatically toxic
  • combustible
  • explosion hazard
  • pool fire hazard
  • inhalation hazard
  • oxidizer that may explode

E2 Plans

E2 Plans must be prepared by any company that owns or that has the charge, management or control of a substance listed in Schedule 1 of the E2 Regulations at the threshold quantity listed. Those companies companies must prepare, implement, and test an E2 plan. ECCC must also be notified about the E2 Plan.

The complexity of E2 plans may vary depending upon the circumstances of the person required to prepare and implement a plan. Although the primary goal of preparing and implementing an E2 plan is to prevent emergencies from occurring, such advance planning is critical for preparedness, response and recovery activities in the event that an emergency does occur. In accordance with the E2 Regulations, the person must consider the following factors when preparing an environmental emergency plan:

  • The properties and characteristics of the substance and the maximum expected quantity of the substance at the place at any time during a calendar year
  • The commercial, manufacturing, processing or other activity in relation to which the plan is being prepared
  • The characteristics of the place where the substance is located and of the surrounding area that may increase the risk of harm to the environment or of danger to human life or health
  • The potential consequences of an environmental emergency on the environment and on human life or health.

As per the E2 Regulations, the environmental emergency plan must include the following:

  • A description of the factors considered above
  • The identification of any environmental emergency that can reasonably be expected to occur at the place and that would likely cause harm to the environment or constitute a danger to human life or health, and identification of the harm or danger
  • A description of the measures to be used to prevent, prepare for, respond to and recover from any environmental emergency identified
  • A list of individuals who are to carry out the actions described in the plan in the event of an environmental emergency, and a description of their roles and responsibilities
  • The identification of the training required for each of the individuals listed
  • A list of the emergency response equipment included as part of the E2 plan, and its location
  • A description of the measures to be taken by the person referred to above to notify members of the public who may be adversely affected by an environmental emergency and to inform them of those measures and of what to do in the event of an environmental emergency

Environment Canada recommends that, while submitting information to fulfill the E2 Regulations requirements, regulatees consider a senior-level statement demonstrating their commitment to implementing and maintaining the E2 plan. They need to keep the plan current, comprehensive and effective (e.g., annual testing and updating of the plan). Appendix 1 of the Implementation Guidelines contains a list of suggested references to assist anyone having to develop an E2 plan.

Environment Canada strongly recommends that persons preparing an E2 plan include community and interest groups and local and provincial emergency authorities in the development and preparation of the plan, and also share the implemented plan with these persons.

Final Impacts on Business

ECCC commissioned a study on the financial impacts of the new regulations in 2014. The study found that the addition of the 33 additional substances to Schedule 1 of the final Regulations will result in some businesses having to prepare, bring into effect, exercise and update environmental emergency plans. Approximately 120 businesses will be required to prepare a new environmental emergency plan at an estimated unit cost of $14,000, while about 80 businesses will be required to update an existing plan at an estimated unit cost of $5,000.

Oil Spill Training Exercise (Photo Credit: Gaylord Herald Times)

The 2014 financial impact study also found that it will be necessary for the businesses preparing new environmental emergency plans to exercise their plans on an annual basis. In particular, a full-scale simulation exercise (action-based simulation exercise requiring the deployment of personnel, resources and equipment) will be required once every five years at each facility. The estimated cost for each full-scale simulation exercise will vary depending on the size of the facility in question, as follows: $3,000 for small-sized facilities; $5,000 for medium-sized facilities; and $10,000 for large-sized facilities. Simulation exercises (exercise simulating the response to an environmental emergency involving the release of a substance) will need to be conducted at each facility once per year during the four years that full-scale exercising is not conducted, at an estimated cost of $1,000 per exercise. 

Brownfield Redevelopment in New York City and Community Air Monitoring – What you need to know

Written by Paul R. Pickering, Aeroqual Ltd.

Brownfield cleanup in New York City

As New York City’s need for space grows, existing stock of land must be used more effectively. Brownfield cleanup and redevelopment represents one of the best opportunities to engage communities and reclaim land for development in many cities. In 2018, the Mayor’s Office of Environmental Remediation (MOER) announced 1000×21, the most aggressive land cleanup and revitalization goal of any city in the world. This OneNYCinitiative seeks to remediate and redevelop 1,000 lots in NYC by the end of the de Blasio administration in 2021.


A vacant lot in Mott Haven, NY before remediation. Photo: OneNYC

Remediation air quality challenges

Any time a remediation or construction project involves earth-moving, it has the potential to release particulate (dust) and volatile organic compounds (VOCs) contaminants that exist below the surface. VOCs will readily transition to the gaseous, breathable phase, when exposed to air. Particulate emissions must be controlled to prevent impacts to the respiratory system. Negative impacts range from mild lung irritation to chronic lung disease. 

Regulations to protect community

To protect workers and the surrounding community, construction and demolition projects that involve excavation need to follow a stringent Community Air Monitoring Plan(CAMP), as specified by the New York State Department of Health (NYSDOH). If the excavation activities are occurring on a remediation or cleanup site, additional requirements are outlined in a guidance document known as DER-10. NYSDOH and DER-10 specifically apply to sites in New York. However, agencies and authorities in other states may also recognize these guidelines. They have been known to apply or refer to them for projects in their designated territories.

What is DER-10?

In 2010, the New York State Department of Environmental Conservation (NYSDEC) issued Division of Environmental Remediation (DER)-10 Technical Guidance for Site Investigation and Remediation, known as DER-10. This is the source document the NYSDEC refer to for authority to oversee remediation projects. It was designed to help parties and consultants (environmental and engineering) in developing and implementing investigation and remediation projects at contaminated sites.

DER-10 extensively (over 225 pages) describes the A to Z requirements for remedial site investigations, cleanups, post-cleanup monitoring and site closure. It presents detailed technical guidance for each of the investigative and remedial steps undertaken at contaminated sites. DER-10 covers procedures for assessing the environmental conditions at the site, including air monitoring during remediation activities.

What is CAMP?

Appendix 1A of the DER-10 outlines requirements for the implementation of a CAMP. This air monitoring plan is prescribed by NYSDOH. It involves direct-reading air monitoring instruments placed at defined locations around the perimeter of a remediation, construction or demolition site.

A CAMP requires real-time air monitoring for total VOCs (also referred to as total organic vapors) and PM10 (particulate matter 10 micrometers or less in diameter) at downwind and upwind locations relative to each designated work area when certain activities are in progress at contaminated sites. The CAMP is not intended for use in establishing action levels for worker respiratory protection. Rather, it is intended to protect the downwind community) from potential airborne contaminants released as a direct result of investigative and remedial work activities. The downwind community includes off-site receptors such as residences, businesses, and on-site workers not directly involved with the subject work activities. The specified CAMP action levels require increased monitoring, corrective actions to abate emissions, and/or work shutdown. Additionally, the CAMP helps to confirm that work activities did not spread contamination off-site through the air.

VOC and particulate monitoring

Basic requirements of a CAMP call for real-time air monitoring for VOCs and/or particulate levels at the perimeter of the exclusion zone, or work area. Sites known to be contaminated with heavy metals alone may only require particulate monitoring. If radiological contamination is a concern, additional monitoring requirements may be necessary in consultation with NYSDEC and NYSDOH. The table below summarizes CAMP Monitoring Action Levels for total VOC and particulate monitoring.

CAMP air monitoring equipment

Since the introduction of DER-10 in 2010, sensor-based technologies have reduced the cost of air monitoring and increased efficiency of the implementation of CAMP. Real-time air monitoring solutions are available to fit the budget and complexity requirements of every project. Below is a sampling of equipment options:

Entry Level – Basic environmental dust monitoring kit

Assembled kits, like this Basic Environmental Dust Monitoring Kit from Raeco Rents, are portable and suited to short-term or temporary CAMP. The ensemble includes an off-the-shelf dust monitor, handheld PID monitor for total VOCs, and a cloud-based telemetry system mounted in an environmental enclosure.

Ultimate Flexibility – All-in-one air quality monitor

All-in-one air quality monitors, like the AQS1 and the Dust Sentry from Aeroqual, are highly flexible and defensible, as well as good allrounders for short or long-term CAMP. In addition to the primary particulate fraction PM10, these monitors can also measure PM2.5, PM1 and Total PM. They can also be configured for monitoring total VOCs and NO2 emissions from remediation and construction sites. A robust light-scattering Nephelometer with sharp cut cyclone is integrated with a PID-based VOC analyzer module (or GSE-based NO2 gas module), Cloud telemetry platform, air quality software, and optional plug-and-play weather and noise sensors. Trigger alerts are programmable for SMS and email notifications, or can be used to activate an external VOC canister sample collection for speciated analysis according to EPA Method TO-15.

The Rolls Royce – GC-based perimeter air monitoring station

Perimeter air monitoring stations, like the AirLogics Classic 2, contain analytical, climatic, and communications instrumentation. This equipment includes: a gas chromatograph (GC) to measure specific VOCs, a respirable particulate meter to measure dust levels, shelter heaters and air conditioners, and a radio-based data acquisition system. These systems were originally developed for use in the cleanup of former manufactured gas plant (MGP) sites.

Weather monitoring

DER-10 guidelines require daily measurement of wind speed and direction, temperature, barometric pressure, and relative humidity, to establish background weather conditions. Wind direction data is used to position the air monitoring equipment in appropriate upwind and downwind locations.

The evaluation of weather conditions is also necessary for proper fugitive dust control. When extreme wind conditions make dust control ineffective, remedial actions may need to be suspended. There may be situations that require fugitive dust suppression and particulate monitoring requirements with more stringent action levels.

Additional monitoring

Under some circumstances, the contaminant concentration and/or toxicity may require additional monitoring to protect site personnel and the community. Additional integrated sampling and chemical analysis of the dust may be required. This must be evaluated when a Health and Safety Plan (HASP), is developed. Appropriate suppression and monitoring requirements are established for protection of people’s health and the environment.

Reporting

All recorded monitoring data is downloaded and field logged daily, including Action Limit Reports (if any) and daily CAMP monitoring location plans. Records are required to be maintained onsite for NYSDEC and NYSDOH to review. A description of the CAMP-related activities is also included in a monthly progress report submitted to the NYSDEC. The overall report submitted to the NYSDEC should include all CAMP monitoring records. If site works are stopped due to inability to control fugitive emissions to below the action limit, the NYSDEC is to be notified within twenty-four hours of the work stoppage.

For a real-life example of air monitoring at a remediation site please read my blog about the pilot cleanup of the Gowanus Canal, NY.

What CAMP solutions does Aeroqual offer?

Aeroqual’s Dust Sentry and AQS1 are flexible air monitoring platforms used by air quality professionals, and environmental and geotechnical consultants, for community air monitoring plans on remediation sites. We help environmental consultants deliver defensible data on projects by providing cost-effective and reliable instrumentation. For insights on the latest air monitoring trends at construction sites please read our blog about measuring NO2 and multiple PM fractions.


About the Author

Paul R. Pickering is the Business Development Director at Aeroqual Ltd., and is located in Auckland, New Zealand. Aeroqual Ltd. is a company that delivers innovative air quality and environmental monitoring solutions. He is passionate about making it easier to measure the air with advanced sensor-based technology. He believes that more relevant information about our environment can help us make better informed decisions, enjoy better quality of life, and make our planet a better home. 

Are New United States Regulations Coming for Accidental Releases into Air?

By Louis A. Ferreira, Willa B. Perlmutter, and Guy J. Thompson, Stoel Rives LLP

On February 4, 2019, a federal court ruled that the U.S. Chemical and Safety Hazard Board must issue regulations within one year that set forth reporting requirements for accidental releases of hazardous substances into the ambient air. This requirement has been part of the Board’s statutory mandate since its inception in 1990 pursuant to Section 112(r)(6)(C)(iii) of the Clean Air Act (“CAA”). Nevertheless, the Board has never issued any such regulations.

Four non-profit groups and one individual filed a one-count complaint against the Board, seeking declaratory relief and an injunction to compel the Board to promulgate reporting requirements as required by the CAA. Plaintiffs claimed that the Board had violated the Administrative Procedure Act by not issuing any regulations. Plaintiffs further asserted the lack of reporting requirements have impaired their respective abilities to collect information that would help prevent future releases and the harm caused from such releases.

The United States District Court for the District of Columbia agreed with the plaintiffs and ruled that the Board must issue regulations within one year. In reaching its decision, the Court rejected the Board’s defenses that the delay in promulgating regulations was reasonable given the Board’s limited resources, small staff size, and other required functions. “[I]f that is the case,” the Court said, “the solution to its resource constraints is not to ignore a congressional directive[,] [i]t is to return to Congress and ask for relief from the statutory requirement.” The case is Air Alliance Houston, et al. v. U.S. Chem. & Safety Hazard Investigation Bd., D.D.C., No. 17-cv-02608, February 4, 2019.

The Court’s decision appears to follow a similar one issued in August 2018 in which some of the same plaintiffs brought a complaint against the U.S. Environmental Protection Agency. In that case, the plaintiffs petitioned the D.C. Court of Appeals for review of the EPA’s decision to delay for 20 months the effective date of a rule designed to promote accident safety and enhance the emergency response requirements for chemical releases. The Court rejected all of EPA’s defenses justifying the delay in a strongly-worded opinion that held the agency strictly to the letter of the CAA. That case is Air Alliance Houston, et al. v. EPA, 906 F.3d 1049 (D.C. Cir. 2018).

The same directness is evident in this recent decision.

Ultimately, the practical effect of the ruling is not clear. There are already laws in place that require companies to report accidental releases to state and federal authorities. It is possible the Board will promulgate regulations that align with its current practice of deferring reporting requirements to other agencies. If the Board took that approach, there likely would not be a noticeable difference in reporting requirements from the current practice.

On the other hand, the two recent decisions discussed above suggest that a trend may be forming in which the courts are pushing back when the government steps off its clear statutory path.


This article has been republished with the permission of the authors. The original post of this article can be found on the Stoel Rivers LLP website.

About the Authors

Lou Ferreira is a senior partner with more than 27 years of complex trial experience.  His practice focuses on commercial litigation, insurance coverage and environmental, safety & health issues.  A seasoned litigator, Lou has significant experience in high-stakes litigation including successfully defending a class action filed against a utility by residents of a town in Washington asserting that the utility was liable for flooding as a result of the operations of its upstream dams.  Lou  successfully defended a port in Washington from a $20 million lawsuit brought by developers alleging breach of contract to develop a large mixed-use waterfront project on the Columbia River. 

Willa Perlmutter has more than 30 years of experience as a litigator, focusing for the last 20 on defending mine operators across all sectors of the industry in administrative enforcement proceedings brought by the Mine Safety and Health Administration (MSHA) for alleged violations of the Mine Act.  In addition, she regularly counsels clients on a broad range of issues that affect their mining operations, from personnel policies and actions to compliance with a broad range of federal statutes. Willa regularly defends companies and individuals facing investigations and formal legal proceedings for alleged safety and health violations under both the Federal Mine Safety and Health Act of 1977 and the Occupational Safety and Health Act of 1970, whether those arise out of a catastrophic event, such as an accident, or in the course of a regular inspection by MSHA or Occupational Safety and Health Administration (OSHA). She has successfully defended a number of mining companies in whistleblower cases brought under the Mine Act.

Guy Thompson is a litigator and advisor on a wide-range of insurance matters. His practice focuses on insurance coverage litigation, including natural resources/environmental insurance coverage, and a wide variety of risk management issues. Guy helps policyholders obtain the recovery they deserve from their insurers and has helped recover millions of dollars from insurance companies for his clients. Guy is skilled at getting insurance carriers to cooperate in paying claims and often secures settlements with insurers without the need for litigation. Recently, he helped recover over $1.65 million from multiple insurance carriers for a Portland company that was required to perform environmental cleanup by the Oregon Department of Environmental Quality.