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Eastern Kentucky University Center for Renewable and Alternative Fuel Technologies (CRAFT)

          On December 1, 2008, Eastern Kentucky University (“EKU”) and General Atomics announced the establishment of the Eastern Kentucky University Center for Renewable and Alternative Fuel Technologies (CRAFT).  This announcement comes less than two weeks after Kentucky Governor Steve Beshear released Kentucky’s first-ever comprehensive energy plan on November 20th, 2008.  The sustainable production of biofuels in Kentucky is a key element of that plan.  The plan calls for Kentucky to derive 12 percent of its motor fuels demand from biofuels by 2025.

            General Atomics is, headquartered in San Diego, California, and specializes in diversified research, development and manufacturing in defense, energy, and other advanced technologies.  Researchers at CRAFT will examine the potential for a cellulose-derived biodiesel industry in Kentucky.  To fund CRAFT, EKU will use a $4 million appropriation in the U.S. Defense Department budget secured by Congressman Ben Chandler, and up to $1.5 million more in state and local funding. 

The project will proceed in two phases, starting with an initial research phase.  The research at CRAFT will focus on (i) determining appropriate cellulosic feedstocks, (ii) defining a strategic plan for starting up an industry that will convert those feedstocks to biodiesel products, and (iii) describing the technologies required along with their developmental costs, risks and schedules. The work will be performed by a team comprised of EKU and General Atomics representatives, with EKU as prime contractor and General Atomics providing the technical lead.

Agricultural and economics modeling research led by EKU will identify and develop baseline agricultural and economics data.  The work will include:

1.   The prioritization of agricultural crops that would make good feedstock for the production of bio-oils,

2.   The identification of land that could be cultivated without negatively impacting existing agricultural businesses,

3.   The determination of potential/probable crop yields,

4.   The identification of the economic impacts on the Commonwealth’s agricultural, transportation, and biofuels industries, and

5.   The determination of transition scenarios for moving toward a biofuel industry in the Commonwealth.

General Atomics will provide input on the biofuel conversion costs and issues of various cellulosic feedstocks to be studied.  Cellulose conversion research will focus on conversion of cellulosic feedstocks to useable sugars.  This work may include subcontracts to companies with unique processes that may be appropriate for this critical step. 

If the initial research phase is successful, General Atomics will begin the second phase by constructing a production facility in Kentucky.  The start of the second phase could be as much as five years away, and the parties would not speculate on when the plant might produce commercial fuel.  General Atomics, however, expects to invest up to $10 million in the project, and EKU indicated that the total investment could eventually be as much as $50 million.

This article was co-authored by Mary Beth Naumann and Ryan Schwartz, Jackson Kelly PLLC. For more information on the authors see (Naumann) here and (Schwartz) here.

11th Circuit Upholds Citizens’ Suit Against Coal Operator

The 11th Circuit decided a case on November 13, which examines when a state administrative enforcement action will “cut off” a citizens’ enforcement action arising under the Clean Water Act. The court held that the state-initiated administrative enforcement action against a coal mining company did not preempt the citizens’ suit that had been initiated by their notice of intent to sue before the administrative action was commenced. The decision is unexceptional, but it is a good example how “not” to solicit enforcement action from the state if one objective is to preclude environmental organizations from asserting subject matter jurisdiction in federal court. The Clean Water Act authorizes citizens’ suits to enforce NPDES permits when neither USEPA nor the State with primacy over the NPDES program are “diligently prosecuting” an enforcement action against the permittee. 33 U.S.C. § 1365(b)(1)(B). Historically, there were cases that held State administrative actions (as opposed to civil actions filed in court) could not serve as diligent prosecutions that cut of the right to file a citizens’ suit. In 1987, Congress amended the CWA to recognize that state administrative actions could cut off citizens’ suits. As the 11th Circuit reminds everyone in its opinion, the “rules of engagement” are complicated. Citizens must file a “notice of intent” to sue at least 60 days before filing a suit in court. Their right to bring the suit is cut off if an agency files a civil or criminal judicial action in court to enforce the NDPES permit before the 60 day period expires. In comparison, a state-initiated administrative action by means of an administrative procedure such as a consent order or before an administrative board can also preclude a citizens’ suit. To have preclusive effect sufficient to prevent the citizens from pursuing their action, however, the administrative action must be initiated before the citizens issue their “notice of intent” to sue. 33 U.S.C. § 1319(g)(6)(B)(ii). In addition, the citizens’ suit must then be filed within 120 days of their notice of intent to sue. In the Cherokee Mining case, a coal company was targeted by a citizens group. The citizens issued their notice of intent to sue. Then the state, presumably at the coal company’s request, initiated an administrative enforcement action. The citizens proceeded to bring their enforcement action in federal district court and the district court denied Cherokee Mining’s motion to dismiss for lack of subject matter jurisdiction. The Court ruled that the administrative action did not cut off the citizens’ suit. The converse should have resulted had the state agency brought its enforcement action as a civil suit in a court before 60 days had passed from the citizens’ issuance of their notice of intent to sue. Alternatively, the state agency could have initiated its administrative enforcement action before the citizens’ notice of intent. The case is Black Warrior Riverkeeper, Inc. v. Cherokee Mining, LLC, No. 08-10810 (11th Cir. November 13, 2008). The decision is not yet published, but has been designated for publication. For further information contact Bob McLusky (304 340-1381) or Blair Gardner (304 340-1146). This article was authored by Blair M. Gardner, Jackson Kelly PLLC. For more information on the author see here.