Judge Tosses Air Permits For $9.4 Billion Louisiana Plastics Plant

Citing a litany of failures by Louisiana environmental regulators, including their analyses of environmental justice and climate impacts, a state judge has thrown out the air permits for a giant plastics manufacturing complex to be located 55 miles west of New Orleans.

The decision is another major blow to the $9.4 billion Formosa Plastics complex, which in 2020 was forced, following a separate lawsuit, to revisit a Clean Water Act permit that had been issued, and then suspended, by the U.S. Army Corps of Engineers, which had put the project on hold.

When the complex and its planned 10-year buildout was announced by Formosa in 2018, it was hailed by Gov. John Bel Edwards as an economic boon and source of 1,200 jobs. But the complex, to be built on 2,400 acres along the Mississippi River in St. James Parish, has also faced fierce opposition from local and national environmental groups fighting to curtail greenhouse gas emissions amid a climate crisis.

Point by point in a sharply worded 34-page ruling made public on Wednesday, 19th Judicial District Judge Trudy White dismantled the rationale for some 15 air permits that the state Department of Environmental Quality (DEQ) issued for the massive complex. The permits would have allowed Formosa to emit more than 800 tons per year of toxic pollution into a predominantly Black, low-income community, and send as much as 13.6 million tons per year of greenhouse gases into the atmosphere, an amount roughly equivalent to 3.5 coal-fired power plants.

“I think this is the beginning of a change,” said Sharon Lavigne, founder and president of RISE St. James, one of several local and national environmental groups that brought the lawsuit in 2019. “It’s a beginning. It’s a new way this industry is going to do business. It will make DEQ think twice” in future permit applications.

In the end, she said, the ruling “is about saving our lives.”

In Louisiana, the petrochemical industry “is used to getting what it wants,” said Corinne Van Dalen, senior attorney at Earthjustice, the nonprofit legal organization that represented plaintiff groups, and the lead attorney on the case. “This is how they do their work and this decision dismantles that.”

It means, she said, the state will be required “to give proper scrutiny to permits before issuing them.”

The DEQ did not respond to a request for comment. But an agency spokesman told The Lens, a nonprofit news outlet in New Orleans, that it was assessing the decision and reviewing its options.

A spokeswoman for FG LA, the local Formosa subsidiary, said the company “respectfully disagrees with Judge White’s conclusion,” and that the air permits were “sound and the agency properly performed its duty to protect the environment in the issuance of those air permits.”  The company was not a defendant in the suit.

The Public Trust Doctrine

The Formosa complex would be built in two phases, employing as many as 8,000 construction workers, according to the company. It would produce polyethylene, polypropylene, polymer and ethylene glycol used to make products like car body parts, plastic bottles, grocery bags, drainage pipes, artificial turf, polyester clothing, antifreeze and playground equipment.

Much of the ruling was based on how DEQ had fallen short in its duty to uphold its role as part of Louisiana’s state constitution known as the public trust doctrine, which mandates that the natural resources of the state, including air and water, be “protected” as much as possible “and consistent with the health, safety and welfare of the people.”

Citing state Supreme Court precedent on the public trust doctrine, the judge wrote that  state regulators are required to make “findings supported by evidence” where “environmental cost and benefits must be given full and careful conservation along with economic, social and other factors.”

In example after example, White determined the agency had not done so while acting in an “arbitrary and capricious” manner.

By using faulty emissions modeling techniques, for example, DEQ fell short in its evaluation of health risks from toxic air emissions, including cancer-causing ethylene oxide, which is facing new scrutiny and limits by the EPA, the judge wrote.  The permits would allow some 7.7 tons a year of the chemical to be released, second-most of any plant in the state, according to the ruling. 

The modeling assumed a standard of pollution control—99.9 percent destruction of the chemical—that was not actually required by the permit, resulting in what the judge called “a hollow promise.”

The region has long been described as “cancer alley,” a reference to the collection of petrochemical plants in the region, and concerns about elevated cancer risks. 

In her ruling, White wrote that DEQ admitted it did not do a cumulative assessment of the complex’s proposed toxic air emissions together with other sources, even though the agency concluded that new emissions, combined with others, “will not allow for air quality impacts that could adversely affect human health or the environment.”

The regulators had also determined that air pollution from the plant and its future contributions to already existing clean-air violations in the region would not be significant.

White disagreed. 

The plaintiffs had argued that the agency’s environmental justice analysis was arbitrary and capricious, and as such, did not comply with the public trust duty of the constitution.

White agreed.

Environmental regulators failed to meet the state’s own definition of environmental justice—minimizing “the disproportionate impacts of its permitting decisions in order to avoid even unintentionally discriminatory effects from state actions.”

Fair treatment, she wrote, “requires more of the agency than mere lip service or opportunities for public involvement.”

White’s ruling described how the complex would be constructed bordering  the town of Welcome, Louisiana, “a community that has a 99 percent minority population, 87 percent of whom identify as Black,” and many of whom are descendants of slaves in a place once dominated by plantations. 

“It’s clear that disproportionality and environmental justice issues are at the very heart of this case,” she wrote.

In her ruling, White quoted Lavigne, who was a special education teacher for 38 years and was a winner of a prestigious Goldman Prize in 2019 for her environmental justice work. White noted that Lavigne had described the area’s lands as “sacred,” having been “passed down to Black residents from their great-great-great grandparents who worked hard to buy these lands along the Mississippi to make them productive and pass them on to their families.”

White wrote that she took Labigne’s comments to mean that “the blood, sweat, and tears of their Ancestors is tied to the land.”

A Massive Carbon Footprint 

On climate, the judge observed that the agency’s failure to weigh the company’s “enormous greenhouse gases is especially egregious given coastal Louisiana’s particular vulnerabilities from the effects of greenhouse-gas induced climate change, such as more intense hurricanes, sea level rise, catastrophic flooding, coastal land loss among other impacts.” 

She wrote that neither the agency nor the company disputed claims by the plaintiffs that greenhouse gases authorized under the permits would increase Louisiana’s total energy-related carbon emissions by 6.5 percent over 2016 levels, or that the 13.6 million tons in emissions are equivalent to the yearly greenhouse gas emissions of 35 coal-fired power plants.

“Yet rather than assessing the climate-related impacts … (the agency) avoided addressing the impact of 13.6 million tons per year of greenhouse gases that the agency authorized after applying emissions limits the agency asserts represents regulatory requirements,” including using what’s known as “BACT,” or best available control technology.

DEQ found that it was not possible to “determine how a specific industrial facility’s incremental contribution to greenhouse gases would translate into physical effects on the global environment,” the judge wrote, adding, “the court does not find that excuse compelling.”

The agency’s “public trustee duty does not require exactness,” and is “not excused of its duty to evaluate the potential and real adverse impacts” of the complex’s greenhouse gas emission, “especially given the enormity of the emissions,” she wrote.

She added that the agency “must take special care to consider the impact of climate-driven disasters fueled by greenhouse gasses on environmental justice communities and their ability to recover.”

Some environmental advocates predicted that the court decision, which could be appealed, might mark the end of the Formosa project.

“This decision is the nail in the coffin for Formosa Plastics,” said Anne Rolfes, director of the Louisiana Bucket Brigade, another one of the plaintiffs’ groups in the case. “They won’t build in St. James Parish, and we will make sure that they won’t build this monster anywhere.”

She called the ruling a “vindication for all of us, especially for the historic Black community of St. James. Judge White affirmed what we have known all along, that the Louisiana Department of Environmental Quality made a terrible decision when it issued Formosa’s air permits. People’s lives are worth more than plastic.”

Other plaintiffs include Healthy Gulf, No Waste Louisiana, Center for Biological Diversity, Earthworks and the Sierra Club.

The company refers to the proposed complex as The Sunshine Project. Its written statement came from Janile Parks, director of community and government relations, FG LA, suggesting it is not giving up.

“FG intends to explore all legal options in light of Judge White’s ruling as the project continues to pursue successful permitting,” Parks said.

Last year, the Institute for Energy Economics and Financial Analysis, a nonprofit think tank that supports a clean energy transition, published a 46-page report that identified a series of economic risks facing the Formosa plant. 

Among them, the plastics market is unlikely to grow fast enough to absorb the products the plant would produce amid a global oversupply of ethylene, a plastics building block, and other chemicals, and long-term demand for virgin plastic production will likely decline as recycling and bans on single-use plastics increase and new ways to make plastics are developed.