Breaking News: Tesla Settles California Hazardous Waste Lawsuit for $1.3 Million

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Almost faster than you can charge a Tesla, the company has settled with 25 California counties that sued the electric car manufacturer for illegally disposing of hazardous waste at its 57 car service centers, 18 solar energy facilities, and manufacturing facility in Fremont, Calif. in Alameda County.

In the complaint filed in San Joaquin County on 30 January 2024, prosecutors alleged Tesla Inc. illegally disposed of hazardous waste generated during its servicing and manufacturing of its electric vehicles in violation of California law establishing the proper control, storage, management, and disposal of hazardous waste. The case is brought by the 25 California District Attorneys’ Offices where Tesla’s factory, car service centers, and solar energy facilities are located.

The Settlement

On 1 February 2024, San Joaquin County Superior Court Judge Jayne Lee ordered Tesla Inc. to pay $1.3 million in civil penalties and $200,000 to reimburse the costs of the investigation. The company also was ordered to comply with a detailed injunction for five years. Injunctive compliance measures include proper training of employees and the hiring of a third party to conduct annual waste audits of its trash containers at 10 percent of its facilities for the next five years.

“While electric vehicles may benefit the environment, the manufacturing and servicing of these vehicles still generates many harmful waste streams,” said District Attorney Brooke Jenkins on 1 February. “Today’s settlement against Tesla, Inc. serves to provide a cleaner environment for citizens throughout the state by preventing the contamination of our precious natural resources when hazardous waste is mismanaged and unlawfully disposed. We are proud to work with our district attorney partners to enforce California’s environmental laws to ensure these hazardous wastes are handled properly.”

The investigation, initiated by the San Francisco District Attorney’s Office Environmental Division, began in 2018 when San Francisco District Attorney investigators conducted undercover inspections of the trash containers at its car service centers, which revealed the illegal disposal of numerous used hazardous automotive components. The illegally disposed of waste included lubricating oils, brake cleaners, lead acid and other batteries, aerosols, antifreeze, waste solvents and other cleaners, electronic waste, waste paint and debris contaminated with these hazardous materials.

Following this discovery, district attorney investigators from Alameda, Monterey, Orange, Placer, Riverside, San Diego, and San Joaquin counties conducted additional inspections at Tesla Inc.’s car service centers throughout California and discovered similar instances of illegal waste disposal. Alameda County District Attorney investigators also conducted waste inspections of trash containers at the Fremont manufacturing facility and found Tesla’s unlawful disposal of additional hazardous wastes, including metal car panel welding spatter waste (which can contain copper), waste paint mix cups produced during paint repair, and wipes/debris contaminated with primer.

Tesla cooperated with the district attorneys’ investigation and took steps to improve its compliance with the environmental protection laws brought to its attention by the prosecutors. After Tesla was notified of the issues, they began quarantining and screening trash containers for hazardous waste at all of its service centers before trash was brought to the landfill. We reached out to Tesla for comment but are still waiting on a reply.

In a blog post published to its web site on 3 January 2024, the company touted the fact that “In the 20 years since Tesla was founded in San Carlos, California, we have grown from a long-shot startup to the state’s largest manufacturing employer and the world’s leading electric vehicle maker.”

In 2022, Tesla had 47,000 employees in California, and the company’s 2 millionth vehicle rolled off the assembly line at the Fremont facility. Since 2016, Tesla invested in over $5 billion in capital investments in its California facilities.

Past History of Environmental Violations

While no one disputes the company’s economic benefit to the state, there have been some environmental challenges. The most recent case is not the first time Tesla has run afoul of environmental laws in California or been fined for violations. On 1 April 2019, the U.S. Environmental Protection Agency (EPA) announced a settlement with Tesla Motors Inc. over federal hazardous waste violations at its automobile manufacturing plant in Fremont, Calif.

EPA, along with the California Department of Toxic Substances Control and the Bay Area Air Quality Management District, conducted unannounced inspections at the Fremont facility in 2017 (a year before the San Francisco District Attorney’s Office began conducting undercover inspections at Tesla facilities that eventually led to the recent lawsuit). The inspections identified violations of federal Resource Conservation and Recovery Act (RCRA) regulations. RCRA rules require the safe management of hazardous waste to protect public health and the environment and to prevent costly cleanups.

The settlement is part of the EPA’s National Compliance initiative to reduce hazardous air emissions at hazardous waste facilities. As a result of the inspections, EPA determined that Tesla:

• Failed to comply with air emissions standards for equipment leaks;
• Failed to comply with management requirements for generators of hazardous wastes; and
• Failed to make an adequate hazardous waste determination for certain solid waste generated at the facility.

Under the agreement, Tesla agreed to take specific steps to properly manage hazardous wastes at its factory. Tesla also agreed to purchase $55,000 in emergency response equipment for the City of Fremont Fire Department and pay a $31,000 penalty.

In addition to paying the $31,000 penalty, Tesla was required to complete a supplemental environmental project to purchase and provide at least $55,000 worth of emergency response equipment for the City of Fremont Fire Department to improve the department’s ability to respond to hazardous materials incidents. Tesla allegedly addressed all the identified violations and was in compliance with RCRA requirements. Tesla also provided hazardous waste training to over 1,100 paint shop associates, technicians, and supervisors at the Fremont facility.

On 22 February 2022, EPA announced a settlement with Tesla Motors Inc. after the agency uncovered Clean Air Act violations at the Fremont facility. Under the settlement, Tesla agreed to pay a $275,000 penalty.

Following several information requests to Tesla, EPA determined that the company violated federal Clean Air Act regulations known as National Emission Standards for Hazardous Air Pollutants for Surface Coating of Automobiles and Light-Duty Trucks from October 2016 through September 2019 by:

• Failing to develop and/or implement a work practice plan to minimize hazardous air pollutants emissions from the storage and mixing of materials used in vehicle coating operations.
• Failing to correctly perform required monthly emissions calculations needed to demonstrate that the facility’s coating operations complied with federal hazardous air pollutant standards.
• Failing to collect and keep all required records associated with the calculation of the hazardous air pollutants emission rate for Tesla’s coating operations.

Compliance monitoring is one of the key components EPA uses to ensure that the regulated community follows environmental laws and regulations and the agency has conducted compliance oversight of the facility for a number of years. Tesla corrected the violations returned to compliance, according to EPA at the time.

About the author: Sandy Smith, Senior Reporter, 3E, is an award-winning newspaper reporter and business-to-business journalist who has spent 20+ years researching and writing about EHS, regulatory compliance, and risk management and networking with EHS professionals. She is passionate about helping to build and maintain safe workplaces and promote workplace cultures that support EHS. She has presented at major conferences and has been interviewed about workplace safety and risk by The Wall Street Journal, CNN, and USA Today.