The 2024 Regular Session of the Louisiana Legislature ended on June 3, 2024. The first regular session of the new term saw legislation on several hot-button issues, including criminal justice reform, reorganization of state governmental entities, insurance reform, education, public access to government records, public libraries, protection of the Louisiana seafood industry, and improvements to correctional facilities. Legislators introduced 1,491 bills (982 House/509 Senate), 42 constitutional amendments, and 771 resolutions and study requests. 792 bills became law. The Legislature also approved a $42.1 billion state operating budget to fund executive department operations.[1]

The Legislature also enacted several new laws affecting energy production and environment regulation. Legislation was passed on several topics including carbon capture and sequestration, air quality monitoring, the sale of electric vehicles, federal revenue sharing for alternative energy projects, liquified natural gas (“LNG”) exports, and changes to “dig law,” among others. Many of these laws go into effect on August 1, 2024, while others became effective upon signature of the Governor, or another date prescribed by legislation. This article offers a synopsis of relevant changes that were made to energy and environmental laws, as well as the regulatory agencies that enforce them.

Environmental Quality & Natural Resources

HB 474 (Act No. 473) affects wetland assimilation projects, which are natural wetlands into which secondarily treated and disinfected effluent from a wastewater treatment plant is discharged to improve water quality and wetland sustainability. HB 474 requires that if wetland assimilation projects discharge treated wastewater, warning signs must be posted near the entrance to wildlife management areas affected by the discharge.[2]

SB 432 (Act No. 494) added requirements for groundwater well meters and monitoring devices for wells capable of drawing 50,000 gallons per day that operate within the Capital Area Groundwater Conservation District. The new law provides that if well owners/operators can comply with the new statutory requirements, secondary monitoring devices from the Capital Area Groundwater Conservation Commission are not required. The new law also adds appointment procedures for industrial members of the Commission.

SB 503 (Act No. 181) creates the Community Air Monitoring Reliability Act to establish standards for community air monitoring programs. The new law provides that air monitoring data collected by third party organizations can be used by the Louisiana Department of Environmental Quality if the data meets federally approved standards for testing and monitoring. The new law also provides that third party data can be used for enforcement proceedings against emission sources for potential violations of the source’s air permits so long as there is other corroborating evidence that a violation has occurred. The new law became effective upon signature of the Governor.

SCR 30 urges and requests the Louisiana Department of Environmental Quality to study the implementation of real-time community air monitoring and notification systems. The resolution creates the Community Air Monitoring and Notification Task Force and requests that it study the costs and benefits of implementation of such systems in communities disproportionately impacted by the negative effects of air pollution.

Coastal Protection & Restoration

HB 806 (Act No. 726) makes changes to the membership of the Coastal Protection and Restoration Authority Board. It adds three at large members who are appointed by the governor and removes the secretaries of the Department of Transportation and Development and the Department of Economic Development, the commissioners of administration, agriculture, and insurance, and the director of the Governor’s Office of Homeland Security and Emergency Preparedness. The new law became effective upon signature of the Governor.

HB 300 (Act No. 408) proposes a constitutional amendment to require all federal revenues generated from alternative or renewable energy production on the Outer Continental Shelf be allocated to the Coastal Protection and Restoration Fund. Current law already allocates revenues generated from oil and gas activity on the Outer Continental Shelf to coastal restoration; this amendment would add funds generated by all other energy activities. The constitutional amendment will be considered by the voters on the November 5, 2024 ballot. HB 305 (Act No. 684) is a companion to HB 300 that, if the constitutional amendment passes, will codify the amendment’s provisions, and provide funding allocations for projects related to hurricane protection and repairs to infrastructure impacted by coastal land loss.

Carbon Capture & Sequestration (CCS)

HB 966 (Act No. 645) allows the commissioner of conservation to order unitization for CCS projects under certain conditions.[3] The commissioner of conservation is authorized to order unitization for a public and necessary purpose with consent of 75% of the property owners within the area of the proposed unit. HB 966 provides that property owners within the unit will receive compensation and requires notice to all mineral interest owners when an application for a CCS injection well permit is completed. It requires the commissioner to determine whether the area of review for a CCS project is within a 500-foot radius of a proposed drilling site and prohibits CCS wells in a unit from being within 500 feet of an inhabited dwelling. It also establishes procedures for authorizing unitization, judicial review of unitization orders and terms, and modification of units. Existing agreements, however, will not be affected by the unitization order.

HB 492 (Act No. 620), a companion bill to HB 966, provides clarification on the rights of owners of land as it relates to eminent domain by requiring a certificate of public necessity and convenience prior to the exercise of eminent domain for CCS facilities and pipelines. It also prohibits expropriation of underground storage rights.

HB 937 (Act No. 461) pertains to landowner liability for carbon dioxide sequestration and clarifies which parties are responsible for obligations established by law. Under HB 937, surface and pore space owners are not liable for any claims related to CCS simply because they are the property owner or due to the fact that they have entered a contract to allow their property to be used for CCS projects.

HB 516 (Act No. 702) requires CCS operators to have an emergency response plan and record maps of CCS projects in affected parishes. It prohibits a CCS well within 500 feet of schools, inhabited dwellings that do not belong to the CCS operator, and health care facilities. It also requires CCS operators to conduct periodic ground water quality testing and monitoring above the stored carbon dioxide and report to the office of conservation. The new law became effective upon signature of the Governor.

HB 169 (Act No. 415) changes current law by converting the established cap on damages for non-economic, or “general,” damages for injuries arising out of CCS projects from a “per occurrence” cap to a “per person” cap. As originally drafted, the bill would have removed the $250,000 damages cap altogether; however, the bill was amended in the House to retain the cap but convert it to a ‘per-person’ application.

HB 934 would have changed the allocation of carbon capture revenues and would have required that the distribution of funds for constitutional and statutory dedications also adhere to the new allocation formula provided by HB 934. However, the bill was vetoed by Governor Landry. In his veto message, the Governor stated that while he supported the sharing of CCS revenues, changes to constitutionally dedicated funds cannot be made through statute.

State Government Organization

HB 810 (Act No. 727) governs the organization, duties, and responsibility of the Department of Energy and Natural Resources (DENR) and creates three new offices with the DENR: (1) the Office of Enforcement, (2) the Office of Energy, and (3) the Office of Land and Water.

  • The Office of Enforcement’s duties are to inspect the regulated community and enforce the laws and regulations within its jurisdiction.
  • The Office of Energy is to manage functions and programs related to the alternative energy infrastructure and the unified energy data and information program.
  • The Office of Land and Water’s duties include managing state lands and water bottoms, issuing energy-related permits and leases on state lands and water bottoms, and managing surface waters of the state.

HB 810 also transfers the Office of the Oil Spill Coordinator from the Department of Public Safety and Corrections to DENR and creates the Natural Resources Trust Authority within DENR to manage grants, investments, and the financial obligations of the permitted community. Additionally, it adds powers and duties for the secretary (i.e., deployment and operation of energy infrastructure and energy and natural resources data and information program and reporting to the legislative oversight committee on termination of board and commission within the department every four (4) years). It also removes the independent operation of the Office of Conservation. HB 810 became effective on July 1, 2024.

HCR 18, SCR 36, and SCR 14 urge federal action on liquified natural gas (LNG) exports. SCR 14 urges the Department of Energy to consider the benefits of LNG exports, while HCR 18 urges the Biden Administration to resume consideration of applications and cites the disruption its “pause” in application approvals has on the global supply chain. SCR 36 requests that Congress block the Administration’s decision to pause export application approvals.

Alternative Energy

SB 268 (Act No. 327) creates a state sales tax rebate for the purchase of equipment, machinery, and other items used in lithium recovery activities. It caps the total rebates that can be granted to $100,000 for the program’s life and ends, or “sunsets,” the program on December 31, 2025. The new law became effective upon signature of the Governor.

HB 515 (Act No. 251) prohibits state governmental entities from restricting a private individual from buying or selling a vehicle that uses a combustion engine. The law does not, however, restrict the sale of electric vehicles.

HCR 64 creates the Clean Hydrogen Task Force to study the growing clean hydrogen industry in Louisiana. Louisiana has been a leading energy center for our nation, and hydrogen can be used as a substitute for conventional fossil fuels with considerably lower greenhouse gas emissions. One of the project’s goals is to make the Louisiana market more competitive in this sector.

Utilities & Infrastructure Security

HB 397 (Act No. 75), commonly referred to as the “One-Call” bill, provides relative to the Louisiana Underground Utilities and Facilities Damage Prevention Law. The largest change made through the legislation is the process for project ticket authorization. The bill also addresses excavations and utilities and allows marking of utilities in certain areas. The bill will allow work to continue a project without the need for an operator to refile project tickets at each project stage. Operators will also be notified when work starts. If an agreement cannot be reached with utility operators, the one-call ticket process can be used. The new law will become effective on January 1, 2025.

HB 507 (Act No. 565) changes the existing prohibition of unlawful entry of a critical infrastructure by adding water control structures, including floodgates or pump stations, wireline, wireless communication networks, and data network facilities to the definition of “critical infrastructure.” The bill also adds penalties for second offenses and offenses committed during a state of emergency.

Litigation

SB 355 (Act No. 765) provides that evidence of third-party litigation finance agreements is discoverable in all state civil actions.

Effective Date of Acts and Future Sessions

Unless otherwise specified in the legislative text, the effective date of all bills during the 2024 Legislative Session is August 1, 2024. The next regular session of the Legislature will begin on April 14, 2025, which will be a “fiscal” or “limited” session in which the Legislature may consider matters relating to state taxation.

It should be noted, however, that stakeholders and lawmakers considered the idea of holding a constitutional convention and also considered convening a limited special session in August or September for the purpose of amending Article VII of the state constitution prior to the fiscal session which convenes in April of next year. A decision was recently made to not convene a special session this year for the purposes of amending the Constitution.

Kean Miller will continue to monitor these developments. For questions or to discuss any of the foregoing, please contact Kean Miller’s Energy/Environmental Team.

[1] For more information about the State Operating Budget for the new fiscal year or other general information about the 2024 Regular Session or 2024 Special Session on criminal justice reform, please see the Louisiana House of Representatives Legislative Services “Session Wrap” summary report, which is available at https://www.house.louisiana.gov/Agendas_2024/2024%202ES-%20RS-Wraps.pdf.

[2] Act 473 became law without the Governor’s signature.

[3] Unitization, normally used for oil and gas projects, is the coordinated operation of a geological reservoir “by all the owners of rights in the separate tracts overlying the reservoir.” Jacqueline Lang Weaver & David F. Asmus, Unitizing Oil and Gas Fields Around the World: A Comparative Analysis of National Laws and Private Contracts, 28 HOUS. J. INT’L L. 3, 6 (2006).