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2022 Quarters 3 and 4 Regulatory Update

During the third and fourth quarter of 2022, there were several regulatory developments involving the United States Fish and Wildlife Service (USFWS) and the Environmental Protection Agency (EPA). These updates are summarized in the following subsections.


Regulations for Listing Endangered and Threatened Species and Designating Critical Habitat

As discussed previously in our Q4 2021 Update, the USFWS and National Marine Fisheries Service (NMFS) proposed to rescind two 2020 final rules associated with designating critical habitat on October 27, 2021. Both rules would cause the relevant regulations and policies to revert to what was in place before the two 2020 final rules were published.

The first proposed rule included rescinding the 2020 final rule establishing a regulatory definition of “habitat.” Considering public comments and the fact that the definition excluded areas from being designated as critical habitat despite the potential for those areas to be considered habitat in the future due to natural processes or reasonable restoration, the USFWS and NMFS published the final rule on June 24, 2022, and it went into effect on July 25, 2022. The USFWS and NMFS find that it is more consistent with the intent of the Endangered Species Act (ESA) and more transparent to the public to determine species habitat on a case-by-case basis using the best scientific data available instead of relying on a potentially unclear and inflexible definition.

The second proposed rule included rescinding the 2020 final rule clarifying how areas can be excluded from a critical habitat designation (e.g., due to economic and national security issues). While the USFWS and NMFS considered whether to retain any portion of the 2020 final rule, they decided to rescind all portions of the regulation as some elements are directly addressed through the 2016 joint policy (between the USFWS and NMFS) and ESA, and other elements undermine the agencies or constrain the agencies’ discretion. With the publishing of the final rule on July 21, 2022, which became effective on August 22, 2022, critical habitat rulemakings and exclusion decisions will once again follow the 2016 joint policy and comply with the associated joint regulations, with the exception of some preamble language that will no longer be applicable (i.e., decisions to not exclude areas from critical habitat are judicially unreviewable). The USFWS and NFMS confirmed that they will always provide an explanation for any decisions to not exclude areas that have been requested for exclusion, even without the 2020 final rule in place. In addition, no previously finalized critical habitat designations or exclusion decisions will be affected by this final rule.


Designation of Experimental Populations

On June 7, 2022, the USFWS published a proposed rule to revise Section 10(j) regulations under the ESA, which allows the USFWS to establish and release experimental populations of ESA-listed species into the wild to aid in their recovery. Examples of experimental populations previously released include California condors, whooping cranes, and Sonoran pronghorns. The proposed revisions include minor changes to provide clarity, as well as the removal of the reference to a species’ “historical range,” which will allow for the introduction of experimental populations into habitat outside of their historical range when that range is affected or will be affected by climate change, invasive species, and/or other threats. The proposed changes will help establish species in more suitable habitats as climate change and invasive species increase. No changes are proposed to the process for designating an experimental population and no existing experimental populations will require reevaluation. The comment period ended on August 8, 2022.

Permits for Incidental Take of Eagles and Eagle Nests

On September 30, 2022, the USFWS issued a proposed rule to simplify and expedite the permitting process authorizing incidental take of eagles and improve compliance with the Bald and Golden Eagle Protection Act. In 2009, a final rule was published to establish permits for the incidental take of eagles and eagle nests; the regulations were subsequently updated with a 2016 final rule, which extended the permit lengths (among other changes). Despite the changes made, participation in the permit program remained low due in part to burdensome processing requirements, which has resulted in unauthorized golden eagle take.

The proposed rule proposes regulations for administering general permits for four activities—wind-energy generation projects, power line infrastructure, disturbance of breeding bald eagles, and bald eagle nest take—as an alternative to the current specific permit (also known as individual permit) process. General permit applicants would need to self-identify and certify eligibility, provide application information and fees, and certify implementation of permit conditions and reporting requirements, with fees and eligibility requirements varying by activity. Thus, USFWS review would not be required prior to obtaining a permit. It is anticipated that the USFWS would conduct annual audits to ensure the general permit program is being implemented correctly. General permits for incidental take and disturbance take or nest removal are proposed to be limited to 5 years and 1 year, respectively, with the ability to reapply upon expiration.

Other changes proposed include:

  • using application and administrative fees to fund program-scale monitoring instead of the current project-scale monitoring that is funded by the permittee, although most general permit holders would still have some monitoring requirements depending on the activity;
  • requiring compensatory mitigation for any permit authorizing take above the applicable Eagle Management Unit take limit, with the form the mitigation takes differing between the specific and general permits;
  • revising the “eagle nest” definition to exclude nest structures on failed nesting substrate (i.e., nesting substrate that will never functionally be usable again); and
  • revising the “in-use nest” definition to clarify that “eggs” must be viable as nonviable eggs can persist in a nest with no chance of hatching.

Webinars for Native American tribes occurred in October and November. Recordings of the sessions can be found here: The public comment period ended on December 29, 2022. More information, documents, and resources are available here:

Standards of Performance for New, Reconstructed, and Modified Sources and Emissions Guidelines for Existing Sources: Oil and Natural Gas Sector Climate Review

On December 6, 2022, the EPA issued a supplemental notice of proposed rulemaking to update, strengthen, and expand the Standards of Performance for New, Reconstructed, and Modified Sources and Emissions Guidelines for Existing Sources: Oil and Natural Gas Sector Climate Review. This latest development aims to augment the New Source Performance Standards (NSPS) EPA first established in 2012 through subpart OOOO (Quad O) under 40 CFR Part 60. The 2012 NSPS established limits of volatile organic compounds (VOCs) from certain segments of the crude oil and natural gas source categories, which included well sites, natural gas gathering stations, natural gas processing facilities, and transmission and storage facilities. In 2016, EPA added Subpart OOOOa, which addressed methane emissions from those crude oil and natural gas source categories and added controls on fugitive emissions and other types of equipment in those industry segments.

In 2020, under the Trump Administration, the EPA issued a “NSPS Policy” Rule that removed the transmission and storage segment, it rescinded the VOC and methane emissions standards for the transmission and storage segment and rescinded the methane emissions standards for the production and processing segments. The Trump administration also issued an NSPS “Technical Rule,” which made several changes to the 2016 NSPS regulations in order to simplify compliance. The Policy Rule was ultimately rescinded under the Biden Administration, which deemed it to never have been in effect.

Currently, the EPA is proposing to strengthen and expand the current requirements for methane and volatile organic compound (VOC) emissions from new, modified, and reconstructed facilities; establish new limits for methane and VOC emissions from new, modified, and reconstructed facilities that are not currently regulated; and establish the first nationwide emissions guidelines for states to limit methane pollution from existing facilities in the source category. To do this, the EPA will revise Subparts Quad O and Quad Oa and add Subparts Quad Ob and Quad Oc.

The proposed December 6, 2022 Quad Ob rule targets emissions from existing oil and gas wells nationwide, rather than focusing only on new wells. The new rule goes a step further and takes aim at all drilling sites, including smaller wells that emit less than 3 tons of methane per year. Comments closed on the Quad Ob proposal on February 23, 2023.

Revisions to Greenhouse Gas Reporting Rules

On June 21, 2022, the EPA published proposed revisions to the Greenhouse Gas Reporting Program (GHGRP) that are codified at 40 Code of Federal Regulations (CFR) Part 98. The EPA is proposing the following types of amendments:

  • amendments to calculation and monitoring methods that reflect an improved understanding of emissions sources and end uses of greenhouse gases (GHGs);
  • amendments that would require reporting of additional data to understand new emissions sources for specific sectors, improve the EPA’s understanding of the sector-specific processes or other factors that influence GHG emission rates, improve verification of reported data, and complement or inform other EPA programs; and
  • amendments that would streamline requirements and improve implementation by providing flexibility, increasing efficiency, and clarifying certain provisions.

Currently, a total of 41 categories of reporters are covered by the GHGRP. The GHGRP covers emissions from different aspects of the oil and gas industry through severa­l of its subparts as shown in the diagram.

With this proposal, the EPA is proposing provisions to align certain requirements in the Petroleum and Natural Gas Systems source category with the EPA’s Proposal to Reduce Methane Emissions from the Oil and Gas Industry (86 CFR 63110).

The proposed revisions are intended to increase transparency associated with carbon capture, utilization, and sequestration activities, including proposing to add reporting of direct air capture as a carbon capture option under Suppliers of Carbon Dioxide (subpart PP) and proposing to add a new subpart, Geologic Sequestration of Carbon Dioxide with Enhanced Oil Recovery, as an option for quantifying geologic sequestration in association with enhanced oil recovery operations.

The EPA is proposing that the revisions would become effective on January 1, 2023, and that reporters would implement the changes beginning with reports prepared for the 2023 reporting year and submitted April 1, 2024. In the limited cases where the EPA is proposing to require new monitoring, such as from Petroleum and Natural Gas Systems (Subpart W) facilities, the EPA is proposing to allow the temporary automatic use of best available monitoring methods (BAMMs) for annual reports submitted for the 2023 reporting year.

Regarding interstate pipelines, the proposal contemplates numerous new requirements on compressor emissions. The EPA’s cost estimates show that sources subject to Subpart W will bear 82 percent of incremental burden associated with the proposed rule. The proposed rule affects more than 2,300 Subpart W reporters and reflects 504 new data elements and 153 revised data elements.


Conservation Banking

On July 26, 2022, the USFWS published a notice requesting public comments to help develop a rule that will establish objectives, performance standards, and criteria for species conservation banking, consisted with the ESA and in accordance with the requirements of the 2021 National Defense Authorization Act. Conservation banks are permanently protected lands with a designated number of credits that can be purchased by project proponents or landowners to mitigate adverse impacts to ESA-listed species and their habitat. The USFWS is interested in ensuring consistency, efficiency, and effectiveness as the conservation banking program grows and applying equivalent standards across the available compensatory mitigation methods for covered species, such as conservation banks, in-lieu fee programs, and restoration. The proposed rule will not affect how the USFWS recommends or requires mitigation. The comment period ended on September 26, 2022.


Desert Tortoise Conservation Plan

Desert tortoises (Gopherus agassizii) occur over large areas of non-federal land in California where there are various energy and commercial projects that can kill or harm desert tortoises. Without a federal nexus, the processing of incidental take permits is complex and time-consuming. Therefore, the USFWS is proposing to develop a general conservation plan for desert tortoise in California to provide a streamlined avenue for project proponents that lack a federal nexus to meet the requirements of the ESA and standardize the issuance of incidental take permits. Proposed covered activities include commercial, agricultural, residential, industrial, and infrastructure development, as well as recreational activities. Virtual public information forums were held in June 2022 in cooperation with the Bureau of Land Management and can be viewed here: Additional information can also be found here:

EPA Definitions for Environmental Justice Communities

On September 30, 2022, the EPA published final definitions of “cumulative impacts” and “cumulative impact assessment” in response to an agency-wide directive to “take steps to better serve historically marginalized communities using cumulative impact assessment.” Both definitions were published in a final report released by the EPA’s Office of Research and Development.

Cumulative impacts are defined as the totality of exposures to combinations of chemical and non-chemical stressors and their effects on health, well-being, and quality of life outcomes. Cumulative impacts include contemporary exposures to multiple stressors as well as exposures throughout a person’s lifetime. They are influenced by the distribution of stressors and encompass both direct and indirect effects to people through impacts on resources and the environment. Cumulative impacts can be considered in the context of individuals, geographically defined communities, or definable population groups. Cumulative impacts characterize the potential state of vulnerability or resilience of a community.

A Cumulative Impact Assessment is defined as a process of evaluating both quantitative and qualitative data representing cumulative impacts to inform a decision. Cumulative impact assessment requires a systematic approach to characterize the combined effects from exposures to both chemical and non-chemical stressors over time across the affected population group or community. It evaluates how stressors from the built, natural, and social environments affect groups of people in both positive and negative ways.

The posited elements of a cumulative impact assessment include community role throughout the assessment, such as identifying problems and potential intervention decision points to improve community health and well-being; combined impacts across multiple chemical and non-chemical stressors; multiple sources of stressors from the built, natural, and social environments; multiple exposure pathways across media; community vulnerability, sensitivity, adaptability, and resilience; exposures to stressors in the relevant past and future, especially during vulnerable life stages; distribution of environmental burdens and benefits; individual variability and behaviors; health and well-being benefits/mitigating factors; uncertainty and variability associated with the data and information; and approach for how to integrate data and information to assess cumulative impacts.

The EPA’s increased focus on cumulative impacts and EPA’s willingness to weigh in on state permitting decisions, requiring additional analysis and stakeholder input, raises additional hurdles for permit applicants. While the four corners of a permit application may not expressly cover environmental justice considerations in the form of cumulative impact assessments, permittees should be prepared for this analysis to be a critical factor for federal, state, and local permitting agencies in their permit approval decisions.

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