One Person’s Trash is Another’s Energy

Carlton Hemphill, MJLST Staffer

It comes to many as a literal and metaphorical breath of fresh air to see the new administration’s interest in reducing the effect we have on the environment, but achieving a goal of net-zero emissions by 2050 is no small feat for such a large country and requires leaving no stone unturned. Much of the recent focus in the media has been on increasing the prevalence of electric cars and switching to renewable energy sources that do not emit carbon dioxide or other greenhouse gases, such as wind and solar. That being said, there is another often overlooked process that, while not the end all solution, can still help us achieve this goal of reducing greenhouse gases, and in my opinion should be getting more attention than it is currently receiving. I am referring to the use of anaerobic digesters.

The Dirty Details:

Let’s face it, people generate a lot of waste, both food waste and excrement. Everybody eats and everybody poops. Moreover, the animals we raise for food also generate an enormous amount of waste. Methane, a byproduct from the decomposition of organic matter such as excrement, acts as a greenhouse gas if released into the atmosphere before being burned. Compared to CO2, methane is 25 times as powerful as a greenhouse gas. Anaerobic digesters use microbes to break down organic waste to produce methane (referred to as biogas) which is then burned to generate electricity.

This is not a novel concept either. Some cities and farms have already taken steps to implement anaerobic digesters for harnessing biogas from sewage and manure. States like Connecticut and New York already implement biogas programs, and many dairy farms across the nation have anaerobic digesters that produce methane from manure. A town in Colorado even powers vehicles using poop . . . yes, you read that correctly.

However, across the country the potential of biogas has not yet been fully realized, meaning there is still a large amount of methane escaping into the atmosphere as a greenhouse gas that could instead be captured and transformed into electricity. The American Biogas Council states that there are currently over 2,200 biogas production sites across the U.S. with the potential for an estimated 14,958 additional sites “ripe for development.”

The biggest barriers to widespread implementation of biogas production stem from a combination of economic feasibility, infrastructure, and lack of political support. Biodigesters can require a large capital investment to setup with financial benefits not being immediately realized. Additionally, while wastewater treatment plants and landfills have existing infrastructure better suited for conversion to biogas production and utilization, rural farms would need either pipes to move the gas or connection to the electrical grid to sell back the generated electricity. Without the necessary political support, in the form of government programs financially incentivizing anaerobic digestion, these issues will continue to act as a deterrent.

Federal eye on Biogas:

While the recent executive orders dealing with the climate crisis do mention mitigating methane emissions, the focus is instead on mining in the oil and gas sectors and not repurposing existing organic matter. It seems then that in our nation’s quest to go green we are overlooking the potential to transform the very waste we create. With food waste constituting the second largest category of solid waste sent to landfills, and cities producing millions of tons of sewage annually, implementing anaerobic digesters would provide numerous environmental advantages. They save landfill space, prevent methane from leaking into the atmosphere, and generate electricity reducing our reliance on other forms of electrical generation.

Fortunately, the EPA recognizes the value in biogas production and, if Biden’s proposed $14 billion in spending towards climate change materializes, the EPA may be able to allocate some of that funding towards developing new sites. When creating new laws and policies aimed at climate change perhaps it is best to always keep in mind the universal law of conservation of energy. Energy is neither created nor destroyed, but rather transformed; what we flush down the drain or discard as trash still has energy and it is up to us to utilize it.

 


I’ve Been Shot! Give Me a Donut!: Linking Vaccine Verification Apps to Existing State Immunization Registries

Ian Colby, MJLST Staffer

The gold rush for vaccination appointments is in full swing. After Governor Walz and many other governors announced an acceleration of vaccine eligibility in their states, the newly eligible desperately sought vaccinations to help the world achieve herd immunity to the SARS-CoV-2 virus (“COVID”) and get back to normal life.

The organization administering a person’s initial dose typically gives the recipient an approximately 4” x 3” card that provides the vaccine manufacturer, the date and location of inoculation, and the Centers for Disease Control (“CDC”) logo. The CDC website does not specify what, exactly, this card is for. Likely reasons include informing the patient about the healthcare they just received, a reminder card for a second dose, or providing batch numbers in case a manufacturing issue arises. Maybe they did it for the ‘Gram. However, regardless of the CDC’s reason for the card, many news outlets have latched onto the most likely future use for them: as a passport to get the post-pandemic party started.

Airlines, sports venues, schools, and donut shops are desperate to return to safe mass gatherings and close contact, without needing to enforce as many protective measures. These organizations, in the short-term, will likely seek assurance of a person’s vaccination status. Aside from the equitable and scientific issues with requiring this assurance, these business will likely get “proof” with these CDC vaccination cards. The cardboard and ink security of these cards rivals social security cards in the “high importance – zero protection” category. Warnings of scammers providing blank CDC cards or stealing the vaccinated person’s name and birthdate hit the web last week (No scammers needed: you can get Missouri’s PDF to print one for free).

With so little security, but with a business-need to reopen the economy to vaccinated folks, businesses and governments have turned to digital vaccine passports. Generically named “digital health passes,” these apps will allow a person to show proof of their vaccination status securely. They “provide a path to reviving the economy and getting Americans back to work and play” according to a New York Times article. “For any such certificate or passport to work, it is going to need two things – access to a country’s official records of vaccinations and a secure method of identifying an individual and linking them to their health record.”

A variety of sources have undertaken development of these digital health passes, both governments and private firms. Israel already provides a nationwide digital proof of vaccination known as a Green Pass. Denmark followed suit with the Coronapas. In addition, a number of private companies and nonprofits are vying to become the preeminent vaccine status app for the world’s smartphones. While governments, such as Israel, have preexisting authority to access immunization and identification records, private firms do not. Private firms would require authorization to access your medical records.

So, in the United States, who would run these apps? Not the U.S. federal government. The Biden Administration unequivocally denied that it would ever require vaccine status checks, and would not keep a vaccination database. The federal government does not need to, though. Most states already manage a digital vaccination database, pursuant to laws authorizing them. Every other state, which doesn’t directly authorize them, still maintains a digital database anyway. These immunization information systems (“IIS”) provide quick access to a person’s vaccination status. A state’s resident can make a request for their vaccination status on myriad vaccinations for free and receive the results via email. Texas and Florida, who made big hubbubs about restricting any use of vaccine passports, both have registries to provide proof of vaccination. So does New York, who has already published an app, known as the Excelsior Pass, that does this for the COVID vaccine. The State’s app pulls information from New York’s immunization registry, providing a quick, simple yes-no result for those requiring proof. The app uses IBM’s blockchain technology, which is “designed to enable the secure verification of health credentials such as test results and vaccination records without the need to share underlying medical and personal information.”

With so many options, consumers of vaccine status apps could become overwhelmed. A vaccinated person may need to download innumerable apps to enter myriad activities. “Fake” apps could ask for additional medical information from the unwary. Private app developers may try to justify continued use of the app after the need for COVID vaccination proof passes.

In this competitive atmosphere, apps that partner with state governments likely provide the best form of digital vaccination verification. These apps have direct approval from the states that are required by law to maintain these vaccination records. They provide some authority to avoid scams. And cooperation to achieve state standardization of these apps may facilitate greater use. States seeking to reopen their economies should authorize digital interfaces with their pre-existing immunization registries. Now that the gold rush for vaccinations has started, the gold rush for vaccine passports is something to keep an eye on.

 


You Gotta Fight for Your Right to Repair

Christopher Cerny, MJLST Staffer

Last spring, as the first wave of the coronavirus pandemic hit critical heights, many states faced a daunting reality. The demand for ventilators, an “external set of lungs” designed to breathe for a patient too weak or compromised to breathe on their own, skyrocketed. Hospitals across the United States and countries around the globe clamored for more of the life saving devices. In March and April of 2020, the increasing need for this equipment forced doctors in Washington State, New York, Italy, and around the world to make heartbreaking decisions to prioritize the scarce supply. With this emergency equipment operating at maximum capacity, any downtime meant another potential life lost. But biomeds, hospital technicians who maintain these crucial medical devices, were frequently unable to troubleshoot or repair out-of-service ventilators to return them to the frontlines. This failure to fix the much-needed equipment was not due to lack of time or training. Instead, it was because many manufacturers restrict access to repair materials, such as manuals, parts, or diagnostic equipment. According to one survey released in February 2021, 76% of biomeds said that manufacturers denied them access to parts or service manuals in the previous three months and 80% said they have equipment that cannot be serviced due to manufacturers’ restrictions to service keys, parts, or materials.

While the prohibition of repairs of life support equipment highlights the extreme danger this restriction creates, the situation is not unique to hospitals and emergency equipment. As technology becomes increasingly complex and proprietary, all manner of tech manufacturers are erecting more and more barriers that prevent owners and independent repair shops from working on their products. Tesla, for example, is adamant about restricting repairs to its vehicles. The electric vehicle auto maker will not provide parts or authorize repairs if performed at an uncertified, independent repair shop or end user. Tesla has gone so far as to block cars repaired outside of its network from using its Superchargers. Apple historically also prevented end users from performing their own repairs, utilizing specialized tools and restricting access to parts. John Deere requires farmers to comply with a software licensing agreement that is in appearance designed to protect the company’s proprietary software, but in practice prevents farmers from clearing error codes to start their farm equipment without an authorized technician.

In response to these obstructions to repair, the Right to Repair movement solidified around the simple proposition that end users and independent repair shops should be provided the same access to manuals and parts that many tech companies reserve solely to themselves or their subsidiaries. This proposition is catching on and the legislatures in twenty-five states are currently considering thirty-nine bills involving the right to repair. However, of the thirty-nine bills, only three address medical technology with the bulk of the proposals devoted to general consumer products—think appliances, iPads, and smart devices—and farm equipment.

Massachusetts is an early adopter of right to repair laws. Its legislature passed a law in 2012 specific to motor vehicles that, inter alia, standardized diagnostic and service information, mandated its accessibility by owners and independent or third-party repair shops, and established any violation of the provisions of the act as an unfair method of competition and an unfair trade practice. This past November, Massachusetts voters approved a ballot measure that expanded the scope of the 2012 right to repair law and closed a loophole that could circumvent the requirements imposed in the earlier statute. Automakers lobbied in force to oppose the measure, spending in excess of $25 million in advertising and other efforts. Taking into account the money spent by both sides of the ballot measure, the right to repair initiative was the most expensive measure campaign in Massachusetts history. The European Union is also taking steps to broaden access to repair materials and information. The European Parliament passed a resolution aimed at facilitating a circular economy. Acknowledging the finite nature of many of the rare elements used in modern technology, the European Union is aiming to make technology last longer and to create a second-hand market for older models. The resolution expanding repair access is a part of that effort by ensuring the ease of repair to prolong the life of the technology and delay obsolescence.

Some manufacturers are making concessions in the face of the Right to Repair Movement. Apple, notoriously one of the most restrictive manufacturers, did an about face in 2019 and expanded access to “parts, tools, training, repair manuals and diagnostics” for independent repair businesses working on out of warranty iPhones. Tesla opened its repair platform to independent repair shops in the European Union after the EU Commission received complaints, but the access can be prohibitively expensive at €125 per hour for the use of diagnostics and programming software. However, these minimal efforts are stop-gap measures designed to slow the tide of legislation and resolutions aimed at broadening access to the materials needed to perform repairs to break the monopolistic hold manufacturers are trying to exert over routine fixes.

The Right to Repair movement is clearly gaining ground as the implications of this anticompetitive status quo in the repair and second-hand market was brought into stark relief by the strains imposed by the COVID-19 pandemic, which strained not only hospitals but agriculture, infrastructure, and day-to-day life. The impact of these restrictions on independent repair shops, farmers, consumers, patients, and do-it-yourselfers more than ever became an obvious impediment to health, safety, and a less extractive economy. And as shown in Massachusetts, voters are responding by expanding the right to repair, even in the face of expensive lobbying and advertising campaigns. Legislators should continue to bring additional bills, especially addressing the restrictions on repairs of emergency medical equipment and should enact the existing proposals in the twenty-five states currently considering them.


“Crunch”ing the Numbers Behind A Marquee Year in Video Games

Ellie Soskin, MJLST Staffer

The COVID-19 pandemic has made this past year a financially devastating one for film and for sports, industries that rely on in-person ticket sales for a share of their revenue. But while those industries struggled, another form of entertainment was having a banner year. The videogame industry saw revenues reach a whopping $180 billion USD, by one estimate. As of last year, more than 214 million people in the United States alone reported playing some form of videogame for at least one hour per week. Four of five U.S. consumers reported playing a video game in the last six months. And with pandemic restrictions limiting activities, gaming on dedicated game consoles, on computers, and on smartphones (“mobile gaming”) has skyrocketed. For many, online gaming has provided a social outlet during a period of isolation, or an almost therapeutic form of escapism. But for all of the potential in the videogame industry, both economic and otherwise, there is a looming labor (and moral) issue that has escaped the law.

The Washington Post recently published a piece on the legality of what’s known in the gaming industry as “crunch.” Generally, crunch, short for “crunch time” occurs at the end of a game’s development cycle. As deadlines loom, the hours become longer and longer and every day becomes a workday; thirteen hour days and seven day workweeks are not remotely unheard of. Ultimately, though, crunch can occur any time there is a major development milestone looming, not just the end of a project.

This is not a new problem, with reports of crunch at major game developers and publishers like Electronic Arts (EA) dating back seventeen years. Back then, video game revenue sat at a relatively miniscule $7 billion annually, a mere 3 percent of where it is today. That explosion in revenue has not changed employment habits. As the Washington Post reports, a 2019 survey revealed that “40 percent of game developers reported working crunch time at least once over the course of the previous year,” with many working “at least 20 extra hours” per workweek and only 8 percent reporting overtime pay. The reports have been consistent over the years: one developer reported working “14 hours a day, six days a week” during a crunch period in 2016. In 2018, employees at major game development studio Rockstar reported an average of 60-hour weeks during crunch (generally six days of ten hour workdays); Rockstar co-founder Dan Houser described “100-hour weeks.” Those kinds of working conditions are a breeding ground for prolonged stress and fatigue, causing mental health issues and even actual physical illness.

News outlets have generally framed crunch as an industry problem without mind for the legal analysis. Publishers demand last minute changes, and studio heads push workers into crunch to appease their financial backers. Or it’s viewed as a rite of passage within the industry and just part of working what is a dream job for a number of young people. In the words of one employee, “[e]mployers know that it’s many people’s dream to be there, so they are able to exploit the fact.” Take This is a mental health non-profit focused on the gaming industry that published a white paper in 2019 reporting on the most pressing mental health issues faced by game developers. Career instability, particularly crunch and lack of job security, were found to be key drivers of poor mental health in developers. Additionally, developers report working for an average of 2.2 employers over a five year period, indicative of the low stability afforded by the industry.

The Washington Post’s piece is admittedly one of the first to focus on the legal framework enabling this kind of employment behavior in the United States. In sum, the video game industry has either exploited existing overtime exemptions for salaried employees under the FLSA and state law or lobbied for new exemptions. For example, after that aforementioned EA crunch exposé, employees sued and settled multiple multi-million dollar class action lawsuits over working conditions. The settlements would have limited the exemptions and reclassified certain employees as overtime eligible, had a new set of exemption rules not been enacted in 2008, lowering the point at which salaried employees are no longer considered eligible for overtime pay.

Crunch as a concept is not simply a United States video game industry problem. Crunch, particularly uncompensated crunch, is also a noted problem in Japanese studios, as well as in various studios worldwide. Polish video game studio CD Projekt Red (CDPR) made six-day workweeks mandatory in the weeks leading up to the highly anticipated release of their big-budget game “Cyberpunk 2077.” Notably, however, those employees all received paid overtime in accordance with Polish labor laws, as well as splitting 10% of the company’s 2020 profits amongst employees as a bonus.

Ultimately, crunch seems to be deeply embedded in the culture of the video game industry worldwide. But there’s no doubt that, as the Washington Post states, it has been enabled by the structure of current labor laws in the United States. Some industry insiders have floated unionization for developers as a potential solution to the lack of legal protections overall, particularly the lack of overtime, poor working conditions, and overall job instability. An industry survey from early 2020 indicated that, when asked if they should unionize, 54 percent of workers said yes, though only 23 percent believed that they actually would unionize. Last January, one of the biggest unions in the United States, Communications Workers of America (CWA), announced their intention to help game workers unionize. But it remains to be seen if anything will come of that and no new reports on unionization have emerged since the beginning of the COVID-19 pandemic. For now, it seems like it’s business as usual for a booming industry.

In the interest of full disclosure, this author’s brother works in the video game industry.


#IsTheShipStillStuck?

Schuyler Troy, MJLST Staffer

The Ever Given, a massive four-hundred-meter-long cargo ship weighing over two hundred thousand tons and carrying over eighteen thousand cargo containers, ran aground in the Suez Canal on March 23, 2021. Wedged between the edges of the canal, the ship blocked all transport through the canal for just over six days. Trade routes were brought to a screeching halt as a backlog of hundreds of ships were left stranded in Egypt’s Great Bitter Lake waiting for passage through the canal, which serves as a conduit for about thirty percent of daily global shipping container volumes, including roughly one million barrels of oil a day. After days of round-the-clock work, the Ever Given was finally pried loose on March 29, allowing traffic to flow again through the canal. The precise cost of the trade stoppage is still unclear, but data from Lloyd’s List showed that the ship held up an estimated $9.6 billion in trade each day that it was stuck—roughly $400 million per hour. The canal itself generated $5.6 billion for Egypt in 2020.

What exactly caused the Ever Given to run aground is currently under investigation. According to an article from Business Insider, initial theories suggested that sudden strong winds caused the hull to deviate from its course and hit the bottom of the canal. Human error is also suspected to have played a part in the fiasco, with reports that the ship was traveling faster than the canal’s speed limit and that its crew opted not to utilize a tugboat escort through the canal. Investigators are also likely to scrutinize the performance of the Ever Given’s two Egyptian canal pilots, both senior chief pilots with more than thirty years of experience.

With so much money on the line, attention will surely turn to who will be left liable for the losses, and the complex structure of ownership and operation of the Ever Given has revealed a tangled web of potentially liable parties. The ship is owned by Shoei Kisen Kaisha, a Japanese subsidiary of Imabari Shipbuilding. At the time it ran aground in the Suez Canal, it was chartered and operated by Evergreen Marine, a Taiwanese container line. The Ever Given is registered in Panama, and is technically managed by the German ship management company Bernhard Schulte Shipmanagement. The crew was comprised of twenty-five Indian citizens, and the ship was insured in part by the UK P&I Club, a United Kingdom based insurance group.

Aggrieved parties are likely to raise claims arising not only from delays in shipment of the goods aboard the Ever Given, but also from cargoes on other ships that were delayed due to inability to transit the canal and from ships which diverted their course around the Cape of Good Hope, a longer and costlier route. There could also be claims for damage to the canal itself, as diggers were required to remove earth and rock from the canal’s banks around the areas where the ship ran aground.

Litigation over the Ever Given’s grounding will likely take years to sort out. In the meantime, we will always have the memes that the fiasco spawned.


It’s Not Always Greener on the Other Side: Challenges to Environmental Marketing Claims

Ben Cooper, MJLST Staffer

On March 16, 2021 a trio of environmental groups filed an FTC complaint against Chevron alleging that Chevron violated the FTC’s Green Guides by falsely claiming “investment in renewable energy and [Chevron’s] commitment to reducing fossil fuel pollution.” The groups claim that this complaint is the first to use the Green Guides to prevent companies from making misleading environmental claims. Public attention has supported companies that minimize their environmental impact, but this FTC complaint suggests that a critical regulatory eye might be in the future. If the environmental groups convince the FTC to enforce the Green Guides against Chevron, other companies should review the claims they make about their products and operations.

A Morning Consult poll released in early December 2020 showed that nearly half of U.S. adults supported expanding the use of carbon removal practices and technologies. Only six percent of survey respondents opposed carbon removal practices. In response to the overwhelming public support for carbon reduction, hundreds of major companies are making some type of commitment to reduce their carbon footprint and curb climate change. One popular program, the Science Based Targets initiative, has over 1,200 participants who made various pledges to decarbonize (or offset the carbon within) their operations.

International and non-governmental organizations took the reins of climate change policy, especially once the Trump Administration withdrew the United States from the Paris Agreement in 2017. “Climate change seems to be the leading fashion statement for business in 2019,” declared a Marketplace story in October of 2019. Yet, as with fashion, style only gets one so far. Substance is key—and often lacking. One of the founders of the Science Based Targets initiative criticized fashionable but flimsy voluntary corporate commitments: “[T]here is not a lot of substance behind those [voluntary corporate] commitments or the commitments are not comprehensive enough.”

The voluntary commitments placated environmental groups when the alternative was the Trump Administration’s silence—but the Biden Administration presents an eager environmental partner: the FTC complaint “is the first test to see if [the Biden Administration] will follow through with their commitment to hold big polluters accountable,” said an environmental group spokesperson according to a Reuters report. The consensus of environmental groups, industry commentators, and regulatory observers appears to be that government oversight is imminent to encourage consistency and accountability—and to avoid “greenwashing.”

Should organizations that make environmental claims be concerned about enforcement action?  It is too early to tell if the Chevron FTC complaint portends future complaints. In the Green Guides, the FTC declared that it seeks to avoid placing “the FTC in the inappropriate role of setting environmental policy,” which might suggest that it will stick to questions of misrepresentation and avoid wading into questions of evaluating environmental claims. It is also worth noting that the FTC is missing one of its five commissioners and Commissioner Rohit Chopra is expected to resign in anticipation of his nomination to head the Consumer Financial Protection Bureau. While the FTC might not be in a position at the moment to enforce the Green Guides, organizations that make environmental claims in marketing materials should monitor this complaint and ensure their compliance with FTC guidance as well as any policy changes from the Biden Administration.


Clawing Back the “Jackpot” Won During the Texas Blackouts

Isaac Foote, MJLST Staffer

For most Texans, the winter storm in February 2021 meant cold temperatures, uncertain electricity at best, and prolonged blackouts at worst. For some energy companies, however, it was like “hitting the jackpot.” We here at MJLST (in Madeline Vavricek’s excellent piece) have already discussed the numerous historical factors that made Texas’s power system so vulnerable to this storm, but in the month after power was restored to customers, a new challenge has emerged for regulators to address: who will pay the estimated $50 billion in electricity transactions carried out during the week of blackouts. A number estimated to eclipse the total sales on the system over the previous three years!

At the highest level, the Texas blackouts were a result of the electric grid’s need to be ‘balanced’ in real time, i.e. always have sufficient electricity supply to meet demand. As the winter storm hit Texas, consumers increased demand for electricity, as they turned up electric heaters, while simultaneously a lack of winterization drove natural gas, wind, and nuclear electricity producers offline. So, to “avoid a catastrophic failure that could have left Texans in the dark for months,” Texas grid operator, the Electric Reliability Council of Texas (ERCOT), needed to find a way to drastically increase electricity supply and reduce electricity demand. Blackouts were the tool-of-last-resort to cut demand, but ERCOT also attempted to increase supply through authorizing an extremely high wholesale price of electricity. Specifically, ERCOT and the Texas Public Utility Commission (PUC) authorized a price of $9,000 per megawatt hour (MWh), over 340 times the annual average price of $26/MWh.

These high prices may have kept some additional generation online, but they also resulted in devastating impacts for consumers (especially those using the electric provider Griddy) and electric distributors (like Brazos Electric Power Cooperative that has already filed for Chapter 11 bankruptcy protection). Now, the Independent Market Monitor (IMM)for the PUC is questioning whether the $9,000/MWh electricity price was maintained for too long after the storm hit: specifically, the 32 hours following the end of controlled blackouts between February 17th and 19th. The IMM claims that the decision to delay reducing the price of electricity “resulted in $16 billion in additional costs to ERCOT’s market” that will eventually need to be recovered from consumers.

The IMM report on the issue has created a showdown in Texas Government between the State Senate, House, and the PUC. Former Chair of the PUC, Arthur D’Andrea, argued against repricing as “it’s just nearly impossible to unscramble this sort of egg,” while the State Senate passed a bill that would require ERCOT to claw back between $4.2 billion and $5.1 billion in from generators for the inflated prices. D’Andrea’s opposition to the clawback has already resulted in his resignation, but it appears unlikely this conflict will be resolved as the State House may concur with the PUC’s position.

There is further confusion over whether such a clawback would be legal in the first place. Before his resignation, D’Andrea implied such a clawback was beyond the power of the PUC. However, Texas Attorney General Ken Paxton issued an opinion that: “the Public Utility Commission has complete authority to act to ensure that ERCOT has accurately accounted for electricity production and delivery among market participants in the region. Such authority likely could be interpreted to allow the Public Utility Commission to order ERCOT to correct prices for wholesale electricity and ancillary services during a specific timeframe . . . provided that such regulatory action furthers a compelling public interest.”

Going forward it appears that the Texas energy industry will be facing a wave of lawsuits and bankruptcies, whatever the decisions made by the PUC or legislators. However, it is important to remember that someone will end up bearing responsibility for the billions of dollars in costs incurred during the crisis. While most consumers will not see this directly on their electricity bill, like those using Griddy had the misfortune to experience, these costs will eventually be transferred onto consumers in some ways. Managing this process in conjunction with rebuilding a more resilient energy system will be a challenge that Texas energy system stakeholders, policymakers, and regulators will have to take on.


No, Dolphins Did Not Reappear in Venice Canals: The Effects of COVID-19 on the Environment

Drew Miller, MJLST Staffer

2020 was a strange, difficult year for billions of people as the COVID-19 pandemic wreaked havoc across the globe. The virus has claimed the lives of over 2,500,000 people, but the effects of the pandemic extend well beyond the loss of life. In an effort to slow the spread of the virus, governments at every level around the world began to implement protective measures such as stay-at-home orders and travel bans as early as March 2020 in the United States—nearly a full year ago. The mass quarantine forced over 100,000 businesses to close their doors in the first two months—some temporarily, some permanently— which in turn led to a rise in unemployment and massive drops in stock markets such as the Dow Jones and the FTSE. These economic effects and their potential remedies have been debated endlessly by news organizations, politicians, and regular citizens alike. However, the environmental effects of the pandemic have not been covered as extensively. Reduced travel tendencies have provided the climate and environment a reprieve, but it will not last; if we are to continue down the road towards environmental sustainability, we must continue to push for reform despite the unique challenges presented by COVID-19.

Environmental Effects

In mid-March, 2020, scattered among an unremitting flood of bad news, some happy stories emerged. Swans and dolphins had returned to formerly desolate Venice canals. A group of elephants had sauntered through a village in Yunnan, China, gotten drunk off corn wine, and passed out in a tea garden. Wild boars were wandering through towns. The stories continued. These reports of the Earth healing and wildlife reclaiming space in a world without people went viral, and understandably so: they offered a spark of light in a dark and uncertain time. One tweet (since deleted) about fish, swans, and clear water in Venice canals amassed over 1,000,000 likes.

Unfortunately, the stories weren’t real. “The swans … regularly appear in the canals of Burano.” “The ‘Venetian’ dolphins were filmed at a port in Sardinia, in the Mediterranean Sea, hundreds of miles away.” The water was clearer because fewer boats were disturbing the sediment at the bottom. The elephants are a regular presence in the depicted village. If anything, allow these stories to serve as a reminder not to believe everything on the internet.

Moreover, the pandemic may have hurt wildlife more than it helped. Many governments pay for environmental conservation and enforcement initiatives with tourism revenue. As that revenue dried up and budgets were cut, those protections weakened. Financial distress caused by widespread unemployment further exacerbated the situation. In April, there were reports of increased falcon smuggling in Pakistan; in June, poaching of leopards and tigers in India; and in October, trafficking of rhino horns in South Africa and Botswana. The chaos of the pandemic also provided cover for illegal logging in the Brazilian Amazon rainforest, which rose more than 50% in the first three months of 2020 compared to the same period in 2019.

Nevertheless, despite the absence of Venetian dolphins, the pandemic looked “okay” from an environmental perspective in 2020. Although there was an uptick in reliance on single-use plastics during lockdowns and increased generation of biomedical waste, pollution levels improved. Transportation, the most significant source of greenhouse gases in the United States, saw a 14.7% decline in emissions, and America’s greenhouse gas emissions from energy and industry plummeted more than 10 percent in 2020, reaching their lowest levels in at least three decades. According to a research group, the fall in emissions nationwide was the largest one-year decline since at least World War II. There were also reduced levels of water and noise pollution.

Policy Implications

Unfortunately, the pollution-related benefits of COVID-19 are likely only temporary. Emissions reductions and air quality improvements primarily resulted from reduced transportation. Consequently, as more people return to their typical travel habits, emissions and air quality are likely to bounce back to their pre-pandemic levels. As Corinne Le Quere, professor of climate change at the University of East Anglia in Britain, stated, “We still have the same cars, the same roads, the same industries, same houses. So as soon as the restrictions are released, we go right back to where we were.”

In fact, emissions may bounce back to levels even higher than they were prior to the pandemic due to the dismantling of numerous climate and environmental policies worldwide. In the United States, nearly 100 environmental protection policies and regulations were reversed or rolled back during the Trump presidency. Citing economic concerns due to COVID, the Czech Prime Minister urged the European Union to abandon the Green New Deal and the European Automobile Manufacturers Association lobbied the European Commission to weaken vehicle emission standards.

COVID-19 has impacted just about every industry in the world, and its economic ramifications continue to present significant difficulties. However, the pandemic is, ultimately, temporary; rebuilding will be challenging, but just as the economy rebounded after the 2008 recession, so it will do again. The Earth may not be so resilient. If we are to achieve a healthier and more sustainable world, businesses and policymakers alike must not recoil from that effort even in the face of unexpected bumps in the road—instead, they must forge ahead.


Decode 16 tons (of bitcoin), what do you get? Nevada considers redefining the phrase “corporate governance”

Jesse Smith, MJLST Staffer

On January 16, 2020, Nevada Governor Steve Sisolak, as part of his state of the state address, announced a new legislative proposal allowing certain types of private companies to essentially purchase the ability to govern as public entities. The proposal applies specifically to tech firms operating within the fields of blockchain, autonomous technology, the internet of things, robotics, artificial intelligence, wireless technology, biometrics, and renewable resources technology. Those that purchase or own at least 50,000 contiguous acres of undeveloped and uninhabited land within a single county can apply to create  “innovation zones” within the property, or self-governed cities structured around the technology the company develops or operates. The company must apply to Nevada’s Office of Economic Development and provide a preliminary capital investment of at least $250 million, along with an additional $1 billion invested over ten years. Upon approval by the state, the area would become an “innovation zone,” initially governed by a three-member board appointed by the governor, two members of which would be picked from a list provided by the company creating the zone. This board would be able to levy taxes and create courts, school districts, police departments, and other offices empowered to carry out various municipal government functions.

One of the main companies lobbying for the passage of the bill, and the likely its first candidate or adopter, is Blockchains LLC, a Nevada based startup that designs blockchain based software in the areas of “digital identity, digital assets, connected devices and a stable means of digital payment.” The company purchased 67,000 acres of largely undeveloped land near Reno in 2018 for $170 million, in pursuit of building what it calls a “sandbox city,.” There, the company would further develop and use its blockchain technology to store records and administer various public and private functions, including “banking and finance, supply chains, ID management, loyalty programs, digital security, medical records, real estate records, and data sharing.”

Natural and rightful criticism of the legislation has mounted since the announcement. Many pointed out that Jeffrey Berns, the founder of Blockchains LLC, is a large donor to both Sisolak and Democratic PACs in Nevada. Furthermore, months before the proposal was unveiled, Blockchains purchased water rights hundreds of miles away to divert to its Nevada land, prompting various outcries from water rights and indigenous activists. From a broader perspective, skeptics conjured up dystopian images of zone residents waking up to “focus group tested alarm[s]” in constantly monitored “corporate apartments.” Others reflected on the history of company-controlled towns in the U.S. and the various problems associated with them.

Proponents of the plan seem fixated on two particular arguments. First, they note that the bill in its current incarnation requires an innovation zone to hold elections for the offices it sets up once its population hits 100. This allegedly demonstrates that while any company behind the zone “retains significant control over the jurisdiction early on, that entity’s control quickly recedes and democratic mechanisms are introduced.” Yet this argument ignores the fact that there is no requirement that a zone ever reach 100 residents. Additionally, even where this threshold is met, the board still retains significant control over election administration, and may divide or consolidate various types of municipal offices as it sees fit, and dismiss officials for undefined “malfeasance or nonfeasance” (§ 20 para. 2). Such powers provide ripe opportunity for gaming how an innovation zone’s government operates and avoiding true democratic control through consolidation of various powers into strategic elected offices.

Second is the more traditional argument that these zones will attract new businesses to the state and bestow an influx of money and jobs upon the citizens of Nevada. Setting aside various studies and arguments that question this assumption, this argument is yet another tired talking point that ignores the damage large businesses already wreak on the local communities they take over. Many overuse the limited resources of various departments. Others use the “value” that big businesses supposedly bring to communities to pit local governments against each other in bidding wars to see who can offer more tax breaks and subsidies to bring the business to their town, money and revenue that could and likely should be used to fund other local programs. Thus, the ability to actually govern appears to be the logical end in a progression of demands big businesses expect from the cities they set up shop in. Perhaps the best argument in favor of innovation zones is also the saddest, in that they allow big businesses to, as is said in corporate speak, “cut out the middleman” by directly collecting the tax dollars they already consume by the billions and directly controlling the municipal resources they already monopolize.

Sisolak, Berns, and other proponents of the proposal fight back against the idea that innovation zones will become the equivalent of “company towns” and argue that it will make Nevada a tech capital of the world by attracting the businesses specified in the bill. They would be well suited to remember two maxims that summarize the criticism of their idea: that history repeats itself and the road to hell is paved with good intentions. There is a reason these phrases are overused cliches. Last week’s MJLST blog post left us with the sweet sounds of Billy Joel to close out its article. As suggested by Tony Tran of “The Byte,” I’ll end mine with the classic, yet unknowingly cyberpunk ballad “16 tons” (the Tennessee Ernie Ford version), and leave the reader thinking about the future plight of the Nevada Bitcoin miner, owing her or his uploaded cloud soul to the company store, aka Blockchains LLC, in their innovation zone job.


Everything’s Bigger in Texas, Including Power Outages

Madeline Vavricek, MJLST Staffer

On last week’s episode of “now what?”, Texas was experiencing massive power shortages following a winter storm, leaving hundreds of thousands of Texans without power and water. An estimated 4.3 million Texans were rendered without power for up to a week as the cold snap that swept the nation caused Texas’s power grids to fail. Though the power grid is back up and Texas has returned to its regularly scheduled spring temperatures, last month’s empty grocery store shelves and power shortages have yet to melt from many Texans’ memories. As massive electric bills arrive in citizens’ mailboxes (hello, surge pricing!), lawsuits levied against power companies, and bankruptcies filed by energy companies, one might ask why Texas, far from being the coldest part of the United States that week, was so thoroughly and singularly felled by the winter weather. The answer, perhaps unsurprisingly, is both political and economic, and requires a history lesson as well.

Nearly half a century after Thomas Edison’s 1880 invention of the light bulb, the advent of the power grid was gaining traction in the nation’s cities and becoming less of a luxury and more of a necessity. This created a highly profitable market for electricity where previously no market had existed, and the expansion of the industry only shed light on ways that electric companies were utilizing the novel market to their advantage. This expansion eventually lead to the passage of the 1935 Public Utility Holding Company Act (PUHCA) under President Franklin D. Roosevelt. The Act outlawed the “pyramidal structure” of interstate utility holding companies, preventing holding companies from being more than twice removed from their operating subsidiaries, and required companies with a ten percent stake or greater in a utilities market to register with the Securities and Exchange Commission for monitoring. Essentially, this legislation was to prevent energy companies from operating as monopolies in the relatively new energy market, a move met with vehement opposition by the utility companies themselves; the bitter feeling was mutual, with FDR notably calling the holding companies “evil” in his 1935 State of the Union address.

While PUHCA inconvenienced these villainous utility companies’ interstate operations, there was one loophole left available to them: their “evil” was left unregulated within the state, allowing holding companies that operated within a single state unregulated under PUHCA.  While the Act was effective, decreasing the number of holding companies from 216 to 18 between 1938 and 1958, creating a “a single vertically-integrated system which served a circumscribed geographic area regulated by either the state or federal government.” It was following the 1935 passage of PUHCA that Texas power companies decided to band together within the state rather than submit to the federal regulation at hand. By only operating within state lines, Texas companies effectively skirted federal regulation and interference, politically maneuvering itself to an energy independence largely made possible through Texas’s energy-rich natural resources.

In the late sixties, the federal government created two main power grids to serve the country: the Eastern Interconnection and the Western Interconnection. Texas opted out of this infrastructure, choosing instead to form its own grid operator, called the Electric Reliability Council of Texas, or ERCOT. The ERCOT grid “remains beyond the jurisdiction of the Federal Energy Regulatory Commission,” the federal entity that regulates the power grid for the rest of the nation. ERCOT took on additional power following the 1999 move to deregulate the energy economy in Texas, an effort to create a completely free market for electricity in the state to benefit both consumers and companies. This independence had most Texans’ ardent approval . . . until the cold front rolled in late February 2021, obstructing the flow of the state’s natural gas and leading to the failure of 356 electric generators state-wide. While other Southern states relied on the national power grid to maintain their electricity, Texas had no one but itself to fall back on, and was quite literally left out in the cold.

While some argue that the independent electrical grid was not to blame for Texas’s misfortunes, insisting that the cold temperatures in the rest of the nation meant there wouldn’t be much energy to spare anyway, it is undeniable that the deep freeze has called attention to many cons of Texas’s pro-deregulation energy market. Though there is what could be considered an “instinctive aversion to federal meddling” in avoiding federal regulation, as well as sensible reasons for a state of Texas’s size and natural resources to remain separate from the other 47 continental United States, the reality remains that many Texans suffered at the hands of its own power grid. As the bills pile up and Texans increase the water bottles they have in their pantry at any given time, one can see how some might favor the security of a more regulated system over the freedom that lead to surge pricing, dry faucets, and dark homes.  However, as with all government regulation, there is a price to pay, and perhaps the Lone Star State prefers to stay “lone” for that very reason. Either way, Texas, now warmer and well-lit, is no doubt grateful to return to our 2021 definition of “normal” and hoping that their lives stop sounding like a verse of a beloved Bill Joel song (no, not Piano Man).