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ACC AM Aug 19
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(ACC Blog) On the Road With #ACCaugust – Updated 8/18/15
Aug 18, 2015 | American Chemistry Matters
During the August recess, our state affairs and political mobilization teams will fan out across the country to create opportunities to further our industry’s advocacy goals in a grassroots initiative we’re calling #ACCaugust. Through plant tours, in-district meetings, and industry roundtable discussions... http://blog.americanchemistry.com/ -
(ACC Mentioned) What's Supporting the Bullish Case for Chemical Stocks?
Aug 18, 2015 | Nasdaq
A gradually improving U.S. economy, sustained healthy momentum in the automotive space and gradually convalescing construction markets augur well for the chemical industry in the back half of 2015. Despite a few industry-related headwinds, weakness across agricultural and energy markets and slowdown in China... -
(ACC Mentioned) Zacks Industry Outlook Highlights: Dow Chemical, LyondellBasell Industries, Eastman Chemical, Celanese and Westlake Chemical
Aug 18, 2015 | Zacks
The $5 trillion global chemicals industry's recovery remains on track amid a still fragile macro environment. The highly cyclical industry is gradually gaining strength after being roiled by the global economic crisis. With the U.S. economic recovery picking up steam in the second quarter of 2015 following a first-quarter... -
(ACC Mentioned) Icynene Introduces New 2 Hour Re-Occupancy And 1 Hour Re-Entry Times
Aug 18, 2015 | PR Web
Global spray foam insulation manufacturer, Icynene, today introduced revised shorter re-entry and re-occupancy allowances for trades and homeowners in the United States for its ultra-low VOC Icynene Classic Max and Icynene ProSeal spray foam products. The revised allowances permit one hour re-entry for trades and two hour... -
(ACC Mentioned) NRDC Supports A Ban On Phthalate Chemicals And Counters Industry Arguments
Aug 19, 2015 | Natural Resources Defense Council
By Jennifer Sass’s
After years of deliberations, scientific review, public meetings, and industry interference, the Consumer Product Safety Commission (CPSC) is getting ready to ban some highly-toxic chemicals called "phthalates" (the 'ph' is silent) from toys and child care products. This makes everyone happy except the big chemical companies that make... -
CPSC Seeks Views on Petition to Ban Flame Retardants
Aug 19, 2015 | BNA Daily Environment Report
By Lisa Helem
The Consumer Product Safety Commission is seeking public comments on a petition requesting that it begin rulemaking under the Federal Hazardous Substances Act (FHSA) to declare several categories of products containing an entire class of flame retardants to be “banned hazardous substances.” -
Comment Deadlines Set on Flame Retardant Information
Aug 19, 2015 | BNA Daily Environment Report
The Environmental Protection Agency announced the comments deadline on preliminary information it has gathered about and risk assessment approaches it proposes to use for three groups of flame retardants (80 Fed. Reg. 49,997). The notice also announces a data-needs assessment for a fourth group of chemicals that includes two flame... -
Companies Unable to Cite Source of Conflict Minerals
Aug 19, 2015 | BNA Daily Environment Report
By Phyllis Diamond
Most companies filing disclosures with the Securities and Exchange Commission for the first time in 2014 weren't able to determine the source of their conflict minerals, the Government Accountability Office reported Aug. 18. According to the report, 99 percent of the companies reported performing country-of-origin inquiries. -
Conflict Minerals Rule Still Violates First Amendment
Aug 19, 2015 | BNA Daily Environment Report
By Rob Tricchinelli
A federal appeals court concluded for the second time Aug. 18 that part of the Securities and Exchange Commission's conflict minerals disclosure rule, required under the Dodd-Frank Act, violates the First Amendment (Nat'l. Assoc. of Mfrs. v. SEC, D.C. Cir., No. 13-5252, 8/18/15). -
Appeals Court Upholds Ruling Voiding Part Of SEC’s Conflict-Minerals Rule
Aug 18, 2015 | PoliticoPro
By Patrick Temple-West
A federal appeals court on Tuesday upheld a decision voiding a piece of the SEC’s “conflict minerals” rule mandating that companies disclose whether their products include minerals from central African war zones. The U.S. Court of Appeals for the District of Columbia dismissed petitions for a rehearing of an April 2014 ruling... -
GAO: Most Companies Unable To Track Down 'Conflict Minerals'
Aug 18, 2015 | The Hill - Policy
By Peter Schroeder
Less than half of all companies required to track down the source of key minerals potentially central to war-torn parts of Africa have been able to do so, according to a new government study. The Government Accountability Office (GAO) reported on Tuesday that 67 percent of companies... -
UMass Sets New Record For Patents In 2015
Aug 18, 2015 | Boston Globe
By Jack Newsham
The pace of innovation at the University of Massachusetts is picking up.UMass landed 65 patents in the 12 months ending June 30, a record for the five-campus university system and a 20 percent jump from the 54 posted in fiscal 2014. That figure includes some of the 40 patents the university ... -
Regulatory, Science Workshops Announced by ECHA, EPA
Aug 19, 2015 | BNA Daily Environment Report
By Pat Rizzuto
Chemical and product manufacturers will get tips on completing their authorization applications during a November workshop the European Chemicals Agency (ECHA) recently announced. Pesticide companies can get information about the European Union's Biocidal Products Regulation at a previously... -
U.S. Envoy Defends Arctic Oil Exploration
Aug 19, 2015 | BNA Daily Environment Report
By Alan Kovski
Exploration for offshore oil in the Arctic is supported by the Obama administration as a pragmatic development that aims for a balance between economic development and environmental protection, an administration special envoy said Aug. 18. Robert Papp, the State Department special representative for the Arctic... -
Republicans Knock Clinton on Arctic drilling, Keystone
Aug 18, 2015 | The Hill - E2 Wire
By Devin Henry
Republicans hit Hillary Clinton for her Tuesday tweet opposing oil drilling in the Arctic Ocean, tying it to her refusal to say where she stands on the Keystone XL pipeline. Clinton tweeted that drilling in the Arctic is “not worth the risk,” echoing many environmentalists who say a potential oil spill there would be devastating to the area’s ecosystem... -
Hillary Clinton: Arctic Drilling 'Not Worth The Risk'
Aug 18, 2015 | The National Journal
By Clare Foran & Ben Gemen
A day after the Obama administration gave Shell the green light to search for oil in icy Arctic waters, Hillary Clinton took to Twitter to voice her disapproval. A spokesman for the Clinton campaign confirmed to National Journal that Clinton's tweet indicates that she opposes Arctic offshore oil-drilling. -
EPA Proposes Methane Limits for New Oil, Gas Wells
Aug 19, 2015 | BNA Daily Environment Report
By Andrew Childers and Patrick Ambrosio
The Environmental Protection Agency proposed the first-ever methane emissions standards for new oil and natural gas wells, but environmental groups said rules are needed for existing facilities as well if the Obama administration plans to meet it goal to curb emissions of the pollutant. -
EPA Rules Target Methane From Oil, Gas Drilling
Aug 18, 2015 | PoliticoPro
By Elana Schor
The Obama administration on Tuesday rolled out a proposal to curb the oil and gas industry’s methane emissions that it billed as the latest step in a more ambitious plan to curtail the sector’s emissions. The next step remains a mystery. EPA said Tuesday that its proposed rules are expected to reduce methane leaks from oil and gas... -
With Proposed Limits On Methane, Epa Takes Aim At A Powerful Greenhouse Gas
Aug 19, 2015 | The Washington Post
By Joby Warrick
The Obama administration outlined plans on Tuesday for sharply reducing emissions of methane gas from oil and gas operations, taking aim at a potent greenhouse gas that studies suggest is playing an accelerating role in the Earth’s warming. A proposed rule announced by the Environmental Protection... -
EPA Targets Host Of Oil & Gas Methane Sources But Backs Existing Controls
Aug 18, 2015 | InsideEPA
By Bridget DiCosmo
EPA's first-time rules regulating methane emissions from the oil and gas sector target a range of “new” sources that environmentalists are hoping will eventually be regulated in a future rule for existing sources, but the plan also appears to allow newly regulated sources to comply using controls that are already required by sources that... -
Methane Caps on Drillers Worked in Colorado
Aug 19, 2015 | BNA Daily Environment Report
By Christine Buurma
For an idea of how the U.S. government's proposed methane rules will affect drillers, look no further than Colorado. The state became a test case for similar controls last year when a coalition of energy companies and environmental groups agreed on measures to cut the pollution. In a bid to address smog, regulators there... -
Liberal Senators Seek SEC Review Of Risk Disclosure
Aug 18, 2015 | E&E News PM
By Phil Taylor
Oil and gas companies have done a poor job disclosing to investors the risks associated with offshore drilling, a dozen liberal senators wrote in a letter today to the Securities and Exchange Commission. The SEC should "conduct a full review of the disclosures of companies" drilling in the Gulf of Mexico or planning to... -
EPA Floats New Aggregation Approach For Oil & Gas Sector Air Permits
Aug 18, 2015 | InsideEPA
By Bridget DiCosmo
EPA is proposing a complex new system for determining when emissions from oil and gas sources should be “aggregated” or combined in air permitting decisions, an effort that appears aimed at ending years of litigation and policy uncertainty over when disparate sources are subject to strict “major” source permit requirements. -
Oil Company-Funded Campaign Targets Activist Steyer
Aug 19, 2015 | BNA Daily Environment Report
By James Nash
Oil companies that bankrolled a $9.7 million effort in 2014 to block laws against hydraulic fracturing in California now are focusing their sights on Tom Steyer, the billionaire hedge-fund founder turned climate-change activist. The top individual political donor in the U.S. last year, Steyer has put millions of his $2.7 billion personal... -
Greens Question EPA's Estimates On Methane Reduction Goals
Aug 18, 2015 | E&E News PM
By Jean Chemnick
While U.S. EPA's new proposal for oil and gas methane encountered the expected cheers and jeers from fans and foes of environmental regulations today, greens found themselves grappling with a statement from EPA air chief Janet McCabe that seemed to suggest the agency was a lot closer to its methane reduction goals than they believed it was. -
N.C. Agency to File Lawsuit Over Clean Power Plan
Aug 19, 2015 | BNA Daily Environment Report
By Jeff Day
The North Carolina Department of Environment and Natural Resources will join other states in seeking to block implementation of the federal Clean Power Plan to control carbon dioxide emissions, according to an agency spokeswoman. DENR spokeswoman Crystal Flagmen told Bloomberg BNA Aug... -
Report: California Cap-And-Trade Bills Seek Billions More Than Available
Aug 18, 2015 | The Sacramento Bee
By Jeremy B. White
California lawmakers have proposed spending billions more in cap-and-trade money than is likely to be available, according to a report compiled by an advocacy organization critical of the climate program.Under the state’s system for curbing greenhouse gases, businesses must buy emissions credits. -
The Limits Of Obama’s New Rules On Pollution
Aug 18, 2015 | The Washington Post
The Obama administration released new pollution rules on oil and natural gas production Tuesday to predictable howls from industry. The danger, though, is that the rules won’t do enough to achieve the United States’ climate goals. The fracking boom has opened vast deposits of American oil and natural gas for extraction, and that’s been a good thing. -
Carson Slams EPA Over Colorado Mine Spill
Aug 18, 2015 | The Hill - E2 Wire
By Devin Henry
Republican presidential candidate Ben Carson slammed the Environmental Protection Agency (EPA) on Tuesday for its handling of a toxic spill into Colorado’s Animas River this month. “The citizens, businesses and peoples relying on the vitality of the Animas River deserve complete, transparent and expeditious accountability on this matter from... -
EPA Sees Input On 'Interpretive' Rules As 'Case-By-Case' Policy Decision
Aug 18, 2015 | InsideEPA
By Bridget DiCosmo
EPA says that its decisions on whether to seek public notice and comment on “interpretive” rules that state its interpretation of the text of an existing regulation are done on a “case-by-case” basis, after some observers suggested a recent Clean Water Act (CWA) rule hinted at EPA seeing limits on its power to waive public input. -
EPA Nominees Seen Hindered By Agency Slowing Responses To Congress
Aug 18, 2015 | InsideEPA
By David LaRoss
EPA's long-pending nominees to head top agency offices could face further delays in Senate consideration due to what some observers see as the agency slowing its responses to queries from Congress, as Republican senators have floated the possibility of blocking all nominations until EPA fully answers a host of outstanding queries. -
EPA Adds Mercury Limit to Phosphoric Acid Standards
Aug 19, 2015 | BNA Daily Environment Report
By Patrick Ambrosio
The Environmental Protection Agency has updated its federal emissions standards for phosphoric acid manufacturing facilities to limit previously unregulated mercury emissions. The final rule, which went into effect Aug. 18, sets a new limit of 0.014 milligram per dry standard cubic meter for mercury emissions from phosphate rock calciners... -
Sunlight Coaxes Urban Grime To Release Smog Compound
Aug 18, 2015 | Chemical & Engineering News
By Michael Torrice
A grimy film covers the streets, statues, and buildings in our cities. This dirty chemical soup, deposited from pollution and dust, could play a previously unknown role in urban air quality, according to research presented Monday at the American Chemical Society national meeting in Boston. -
Mining Company Urges 9th Circuit To Reverse Novel CERCLA Air Ruling
Aug 18, 2015 | InsideEPA
By Suzanne Yohannan
One of Canada's largest mining and mineral development companies is urging a federal appellate court to reverse a lower court's novel ruling that found air emissions stemming from a mining facility constituted "disposal" of hazardous substances under Superfund law, which the company argues conflicts with a 2014 ruling by the... -
Four Powerhouse Bills to Help California get to 50 Percent Renewable Energy
Aug 18, 2015 | Environmental Defense Fund
By Lauren Navarro
California is deep into the dog days of summer, and pressure is mounting on the state’s electric grid to keep up with demand. Luckily, California’s legislature is working to bring more clean energy resources to the grid, diversifying how we power our homes and businesses while also improving the resiliency, efficiency, and carbon footprint of our ...
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(ACC Blog) On the Road With #ACCaugust – Updated 8/18/15
Aug 18, 2015 | American Chemistry Matters
During the August recess, our state affairs and political mobilization teams will fan out across the country to create opportunities to further our industry’s advocacy goals in a grassroots initiative we’re calling #ACCaugust. Through plant tours, in-district meetings, and industry roundtable discussions, we will meet with Members of Congress to raise awareness of the vital importance of our industry and showcase the economic benefits of the business of chemistry where it matters the most—in their districts.
Take the #ACCaugust tour with us! Zoom in and out and pan around to see where we’ve been and where we’re going (don’t forget Alaska!):
- See more at: http://blog.americanchemistry.com/2015/08/on-the-road-with-accaugust/#sthash.zo4aEYcq.dpuf
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(ACC Mentioned) What's Supporting the Bullish Case for Chemical Stocks?
Aug 18, 2015 | Nasdaq
A gradually improving U.S. economy, sustained healthy momentum in the automotive space and gradually convalescing construction markets augur well for the chemical industry in the back half of 2015. Despite a few industry-related headwinds, weakness across agricultural and energy markets and slowdown in China, there are a number of reasons to be optimistic about the broader chemical industry for both the short and long haul, which we have highlighted below:
Shale Boom Driving Chemical Investments
The shale gas bounty in the U.S. has been a huge driving force behind chemical investment on plants and equipment in the country. According to the American Chemistry Council (ACC), abundant shale gas production is driving U.S. chemical exports. New methods of extraction such as horizontal drilling and hydraulic fracturing (or fracking) are boosting shale production, bringing down prices of ethane (derived from shale gas) in the process.Leveraging the abundant natural gas supply, chemical makers are ratcheting up investment on shale gas-linked projects which is expected to beef up capacity. The shale revolution made the U.S. an attractive investment hotspot and incentivized a number of chemical companies to pump in billions of dollars for setting up facilities (crackers) to produce ethylene and propylene in a cost-effective way.
Per an ACC report, domestic chemical investment related to shale gas has reached as high as $145 billion, more than 60% of which are from firms outside the U.S. Already 238 projects -- many backed by the Federal government -- have been announced by chemical makers to take
advantage of ample natural gas supplies. Such investments are expected to boost capacity and export over the next several years.
Automotive Continues to "Accelerate"
The automotive sector is witnessing significant momentum. This major chemical end-use market is enjoying the fruits of low gasoline prices. Global automotive sales are expected to remain on uptrend and hit 88.6 million units this year (up 2.4% from 2014), according to IHS Automotive.
The U.S. auto industry also remains on top gear with new car and light truck sales are expected to jump to 17.17 million units in 2015 from 16.4 million units in 2014 on the back of low gasoline prices and pent-up consumer demand, further reaching a record high of 17.46 million units in 2016, as per The National Automobile Dealers Association (NADA) estimates.
In particular, U.S. light vehicles (a key end-user market) sales are expected to increase this year, riding on improving employment rates and household income, lower fuel prices, attractive financing options and pent-up demand. The Auto industry in Asian countries, especially China, is also expected to thrive over the next several years. As such, chemical makers are expected to gain from higher demand from this important end-market.
Strategic Moves
Chemical companies continue to shift their focus on attractive, growth markets (driven by megatrends) in an effort to cut their exposure on other businesses that are struggling with weak demand and input costs pressure. Moreover, cost-cutting measures -- including plant closures and headcount reduction -- and productivity improvement actions by chemical companies are expected to yield industry-wide margin improvements. Several chemical makers are also disposing non-core assets as they shift their focus on high-margin businesses.
M&A Heating Up
The chemical industry is also seeing a pick-up in consolidation activities, as witnessed last year. Chemical companies remain actively
focused on mergers and acquisitions to diversify and shore up growth in a still-challenging economic environment. These companies continue to explore growth opportunities in the fast-growing emerging markets, particularly in the lucrative regions of Asia-Pacific and Latin America.
PPG Industries Inc.'s ( PPG) acquisition of Mexican paint company Comex, Albemarle Corp.'s ( ALB
) $6.2 billion buyout of Rockwood Holdings, Inc. and CF Industries' ( CF
) proposed acquisition of certain assets of Netherlands-based OCI N.V. for around $8 billion are among the major deals that have taken place in the chemical space in the recent past.
A Rebounding Construction Space
A recovery across housing and commercial construction -- major chemical end-markets -- has been another supporting factor for the chemical
industry recovery. After being hit hard in the recession, the construction industry is currently in the process of gradual healing.
The housing sector saw steady recovery in 2014 backed by stabilizing mortgage rates, improving job market and moderating home prices, and the momentum is expected to continue through 2015. While the U.S. housing market witnessed a slowdown at the beginning of 2015 due to another harsh winter, housing activity picked up steam in the crucial spring and summer months, assisted by an improving economy, encouraging job picture and rising consumer confidence.
The renewal of long-stalled construction projects and long awaited access to credit from lending institutions have helped invigorate the commercial construction sector. The US Architecture Billings Index (ABI), an indicator that offers a glimpse into the future of U.S. non-residential construction spending activity, climbed to 55.7 in June 2015 from 51.9 a month ago (a reading above 50 indicates an increase in billings).
Moreover, the American Institute of Architects (AIA) expects non-residential construction spending to go up nearly 8.9% in 2015 and
8.2% in 2016. This bodes well for demand for chemicals in the construction markets.
Wrapping Up
The chemical industry -- which had long been out of favor -- is finally looking up, making it an attractive investment proposition for 2015. As you can see from the above-stated factors, there are a few good reasons to be optimistic about the industry.
Chemical stocks that are well placed in the current operating backdrop include The Dow Chemical Company ( DOW ), LyondellBasell Industries NV ( LYB ), Celanese Corp. ( CE ), Air Products and Chemicals Inc. ( APD ), Eastman Chemical Company ( EMN ) and PPG Industries Inc. -
Aug 18, 2015 | Zacks
The $5 trillion global chemicals industry's recovery remains on track amid a still fragile macro environment. The highly cyclical industry is gradually gaining strength after being roiled by the global economic crisis.
With the U.S. economic recovery picking up steam in the second quarter of 2015 following a first-quarter lull, the chemical industry fared reasonably well in the June quarter, helped by strength across automotive and residential construction markets. But the industry is not without its problems as challenges such as soft agriculture market fundamentals, depressed demand in energy markets, sluggishness in China and headwinds from a stronger dollar weighed on the performance of chemical makers during the first half of 2015.
Chemical companies are increasingly focusing on high-growth markets to cut their exposure on businesses that are grappling with weak demand and input cost pressures. Moreover, strategic measures including cost management and acquisitions/divestments remain the prime focus of these companies to stay afloat in a still challenging global economic backdrop.
Some industry-specific challenges, Eurozone's tepid recovery and concerns over China's future growth remain sources of near-term uncertainties for the chemical industry. Chemical makers are also feeling the bite of weak demand in the energy space given the oil price slump.Notwithstanding these challenges, the industry is expected to continue to recuperate through the balance of 2015, supported by strong momentum in the light vehicles market, an upswing in the housing sector, continued recovery in commercial construction and significant shale-linked capital investment.
U.S. Looks Healthy, Europe and China Foggy
The U.S. chemical industry is poised for growth this year and the next despite a spate of headwinds. According to the American Chemistry Council (ACC), an industry trade group, U.S. chemical production will expand both this year and next, and the American chemical industry will eventually transcend the nation's overall economic growth and emerge as a long-term economic growth engine as improvements in key end-use industries and emerging markets take hold.
However, the ACC has dialed back its estimates for U.S. chemical production for both 2015 and 2016 factoring in the impact of a stronger dollar. A mightier greenback is holding down U.S. exports, reducing their attractiveness in overseas markets.
The ACC now envisions U.S. chemical production to rise 3.2% this year and 3% in 2016 versus a 3.7% and 3.9% growth expected earlier in 2015 and 2016, respectively. But the revised outlook is still higher than 2% growth witnessed in 2014.
Despite the slowdown in global manufacturing and oil price volatility, the U.S. chemical industry is seeing production volume gains. Production is expected to pick up pace on the heels of new capital investments and capacity additions. While strength in the U.S. manufacturing, an improving job market and expansion in major end-use markets have boosted demand for chemicals, persistent softness in overseas markets has constrained U.S. export sales.
The shale gas boom and abundant supply of natural gas liquids have provided the U.S. petrochemicals producers a compelling cost advantage over their global counterparts. The ACC expects this competitiveness to drive export demand and new capital investment in the country. New capacity is expected to provide a significant boost to chemical production as these investments come on stream in the coming years.
The shale revolution has incentivized a number of chemical companies to invest billions of dollars to ramp up capacity in the country. Chemical makers including Dow Chemical ( DOW ), LyondellBasell Industries ( LYB ), Eastman Chemical ( EMN ), Celanese ( CE ) and Westlake Chemical ( WLK ) are investing heavily on shale gas-linked projects to take advantage of ample natural gas supplies which is expected to boost capacity and export over the next several years.
Outlook for Europe, however, remains cloudy. The Eurozone economy is sputtering along with a meager growth in the second quarter of 2015. Chemical makers in the European Union remain affected by lower prices and sluggish demand. Chemical prices, which fell 1.8% in the European Union last year, remain under pressure.
The European Chemical Industry Council (CEFIC) expects European chemical output to rise 1% this year after a measly 0.3% year over year rise in 2014. High energy costs and weak R&D investments are also hurting the European chemical industry.Moreover, the slowdown in China, further evidenced by the recent weak economic data, may weigh on demand for chemicals in this key market. The world's second-biggest economy remains rattled by its tepid property market and weak infrastructure investment growth, which is contributing to its sluggish economic growth.
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(ACC Mentioned) Icynene Introduces New 2 Hour Re-Occupancy And 1 Hour Re-Entry Times
Aug 18, 2015 | PR Web
Global spray foam insulation manufacturer, Icynene, today introduced revised shorter re-entry and re-occupancy allowances for trades and homeowners in the United States for its ultra-low VOC Icynene Classic Max and Icynene ProSeal spray foam products. The revised allowances permit one hour re-entry for trades and two hour re-occupancy for homeowners. The announcement comes just three months after the introduction of the two ultra-low VOC spray foam products.
The revised re-entry and re-occupancy allowances follow months of extensive research, testing and third-party evaluation of the two ultra-low VOC spray foam products based on protocols and procedures developed by a task group of the American Chemistry Council – Center for the Polyurethanes Industry (ACC-CPI).
“Once again, Icynene leads the insulation industry through product and testing innovation. Shorter re-entry times allow builders in residential and commercial projects to continue construction with minimal impact on their schedules, while shorter re-occupancy times offer homeowners the opportunity to return to their homes the same day, within hours, of their spray foam installation,” said Icynene VP Marketing, Betsy Cosper.
“Full scale testing and research evaluated by credible third party chemists and toxicologists has confirmed that re-entry and re-occupancy times can be further reduced to one hour and two hours respectively. Ultra-low VOC Icynene Classic Max and Icynene ProSeal spray foam, combined with the use of higher workplace ventilation rates of 40 Air Changes per Hour (ACH), have helped us reduce exposure risks to spray foam installers, to non-spray foam trades and, most especially, to homeowners and their families,” said Icynene VP Engineering, Paul Duffy.
The revised re-entry and re-occupancy allowances are only applicable for installations of Icynene Classic Max and Icynene ProSeal in the United States and are based on an active ventilation rate of 40.0 ACH.
# ENDS #
About Icynene
Established in 1986, Icynene helps to build energy efficient residential and commercial structures in over 31 countries worldwide. Our portfolio of industry leading light density open cell and medium density closed cell SPF solutions are both insulation and air barrier materials for improved indoor air quality and reduced energy costs making Icynene the smart choice for builders, architects, building owners, and homeowners. -
(ACC Mentioned) NRDC Supports A Ban On Phthalate Chemicals And Counters Industry Arguments
Aug 19, 2015 | Natural Resources Defense Council
By Jennifer Sass’s
After years of deliberations, scientific review, public meetings, and industry interference, the Consumer Product Safety Commission (CPSC) is getting ready to ban some highly-toxic chemicals called "phthalates" (the 'ph' is silent) from toys and child care products. This makes everyone happy except the big chemical companies that make and sell phthalates, and their friends-for-hire.
Phthalates are a family of chemicals used mostly as plasticizers in a large number of consumer products including fragrance mixtures, adhesives, and food contact applications. Products with phthalates include plastic food packaging and food wrapping, nail polish, indoor air fresheners, fragrance in laundry dryer sheets, flexible plastics including medical tubing, and wire and cable coatings.
In 2008, Congress directed the CPSC to convene a Chronic Hazard Advisory Panel (CHAP) to review the toxicity of all the phthalate chemicals used in children's products. The CHAP panel of experts was convened in 2010 and after four years of meetings, extensive public comments, and peer review, it delivered its final report and recommendations in July 2014. The CHAP's analysis represents the most comprehensive and current evaluation of phthalates risk to human health. It concluded that eight phthalates are unsafe for use in children's toys and child care articles at levels greater than 0.1% and recommended that they be banned from toys and child care products. For other phthalates, the report noted potential development hazards and significant data gaps which prevented the experts from drawing any conclusions with confidence.
CPSC is now moving forward to ban the eight phthalates from toys and child care products, due to evidence of toxicity to reproduction and development. Good job, CPSC!
And, of course, after such a lengthy process one might think that there is nothing new to say that hasn't been said already. You'd be right. Nonetheless, Exxon Mobil and corporate law firm Latham & Watkins have challenged the ability, and even the right, of CPSC to follow the CHAP report recommendations, and in particular to extend the ban to include DINP. I address their main arguments below:Industry says that the CHAP is an advisory committee and CPSC need not and should not base its decision solely on the CHAP's recommendations. The reality is that nothing in the law prevents CPSC from following those recommendations, especially after a consideration of considerable public input in an extended public process. CPSC made its own decision, issued its own proposed rule, and solicited public comment from industry and others on its proposed rule. Now, CPSC needs to cross the finish line and implement the ban.Industry says that CPSC must disregard the CHAP report if it is based on incorrect or outdated data and must provide sufficient opportunity for public comments. Industry also says that if CPSC simply follows the CHAP recommendations, then it has failed to provide meaningful opportunities for public comment. The reality is that in addition to its scientific rigor, the CHAP process was highly public, and considered multiple public comments and written submissions from industry and others over a period from 2009 until the release of its final report in 2014. Public comments included numerous submissions from the American Chemistry Council (ACC), ExxonMobil, BASF, corporate law firm Latham and Watkins, Eastman Chemical Company, and other industry representatives. Exxon Mobil and the rest of the pro-phthalate lobby took full advantage of limitless opportunities over the past five years to sponsor studies, criticize independent studies, participate in public meetings, meet with CPSC and other government officials, submit comments to the CHAP and CPSC, influence public media, and meet with Congress. ExxonMobil met with CPSC's Office of General Counsel and had three separate meetings with CPSC Commissioner's office just last month (July, 2015). Industry cannot reasonably make an argument that it has not had opportunity to voice its position to either the CHAP or the CPSC - at this point it is not information, but simply a delay tactic.Industry says that while Congress required CPSC to consider cumulative effects of total exposure, the CHAP went beyond its charge when it produced a risk assessment, and that the CHAP may not recommend the ban of an individual phthalate as opposed to a mixture of substances. The reality is that Congress did not dictate how the CHAP should consider cumulative risk, and the CHAP was well within its authority to carry out a cumulative risk assessment. The CHAP assessed the risks of 14 phthalates individually, while cumulative risks were considered for anti-androgenic phthalates only (these were DEHP, DBP, BBP, DINP and DIBP) based on developmental toxicity in males. The CHAP did not go beyond the bounds of its charge, and its recommendations regarding cumulative risk to CPSC are reasonable, scientifically-defensible, and consistent with existing methods.Industry says that one of the phthalates whose use is on the rise, DINP, does not significantly contribute to the cumulative risk, so banning it would be "arbitrary and capricious". The reality is that DINP is rapidly replacing another highly toxic phthalate, called DEHP, in polyvinyl chloride (PVC) plastics found in building materials, cables and wires, toys, and food packaging. Although it appears to be less toxic than DEHP, the reality is that we know very little about the hazards of the replacement phthalates, and so their contribution to the cumulative risk is largely unknown. However, the potential health risks go beyond antiandrogenic effects to include liver toxicity.
Due to the widespread human exposure and concerns about public safety, especially for young children and the unborn, both European and US governments banned the use of certain phthalates in toys and child care products in the years 2006 and 2008, respectively. Since then, the strength of the evidence supporting those bans has only increased.
That's why NRDC and other environmental health advocates are supporting CPSC's proposal to:Maintain the current ban on DBP, BBP, and DEHP in toys and child care products;Permanently ban four additional phthalates- DIBP, DPENP, DHEXP, and DCHP;Make permanent the current interim ban on DINP.
CPSC should make these bans final, and not allow the friends-of-phthalates to delay its important work to protect human health.
NRDC provided detailed comments in response to industry arguments to Docket IDCPSC-2014-0033-0109 (August 2015), and detailed comments supporting the bansproposed by the CPSC on phthalates to Docket ID CPSC-2014-0033-0089 (April 2015)
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CPSC Seeks Views on Petition to Ban Flame Retardants
Aug 19, 2015 | BNA Daily Environment Report
By Lisa Helem
The Consumer Product Safety Commission is seeking public comments on a petition requesting that it begin rulemaking under the Federal Hazardous Substances Act (FHSA) to declare several categories of products containing an entire class of flame retardants to be “banned hazardous substances.”
The notice, that CPSC is inviting comments on the petition, is scheduled to be published in the Aug. 19 Federal Register.
The petitioners, Earthjustice and the Consumer Federation of America, joined by the American Academy of Pediatrics, the American Medical Women's Association and several other groups, on March 31 asked the agency to begin rulemaking under the FHSA to end the use of nonpolymeric, additive organohalogen flame retardants in four types of household products (62 DEN A-16, 4/1/15).
The groups ask the CPSC to declare that any children's toy or other children's product containing additive organohalogen flame retardants is a “banned hazardous substance.”
Widespread exposure to organohalogens is concerning, the petition said, “because all organohalogen flame retardant chemicals, as a class, are toxic due to their physical, chemical and biological properties.”
Adverse Health Effects
The adverse human health effects associated with these chemicals include reproductive impairment; neurological issues, including decreased IQ in children, impaired memory, learning deficits, altered motor behavior and hyperactivity; endocrine disruption; genetic harm; cancer; and immune-system problems, according to the petition.
The petition also targets products including upholstered furniture sold for residential use, mattresses and mattress pads, and consumer electronics (exterior parts only) for both the “hazardous substance” and “banned hazardous substance” designations.
Others joining in the petition include: Consumers Union, Green Science Policy Institute, International Association of Fire Fighters, Kids in Danger, Philip Landrigan, M.D., M.P.H., League of United Latin American Citizens, Learning Disabilities Association of America and Worksafe.
Comments must be submitted within 60 days of publication.
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Comment Deadlines Set on Flame Retardant Information
Aug 19, 2015 | BNA Daily Environment Report
The Environmental Protection Agency announced the comments deadline on preliminary information it has gathered about and risk assessment approaches it proposes to use for three groups of flame retardants (80 Fed. Reg. 49,997). The notice also announces a data-needs assessment for a fourth group of chemicals that includes two flame retardants. The EPA released all four documents online Aug. 13 (157 DEN A-1, 8/14/15). The agency released this initial information to make its thinking about and proposed analytic process for the chemicals clear and to provide opportunity for the public to comment on both. The agency also invited additional information and data. Comments on the preliminary information for the three groups of chemicals—chlorinated phosphate esters, cyclic aliphatic bromides and tetrabromobisphenol A and related chemicals—are due by Oct. 19. Comments on the data-needs assessment for brominated phthaltes are due Dec. 16. The Federal Register notice and docket numbers for each group of chemicals are available at http://www.gpo.gov/fdsys/search/pagedetails.action?granuleId=2015-20370&packageId=FR-2015-08-18&acCode=FR.
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Companies Unable to Cite Source of Conflict Minerals
Aug 19, 2015 | BNA Daily Environment Report
By Phyllis Diamond
Most companies filing disclosures with the Securities and Exchange Commission for the first time in 2014 weren't able to determine the source of their conflict minerals, the Government Accountability Office reported Aug. 18.
According to the report, 99 percent of the companies reported performing country-of-origin inquiries. However, the companies “cited difficulty obtaining necessary information from suppliers because of delays and other challenges in communication,” the report said.
Most companies (87 percent) were based in the U.S., the GAO said. It said 94 percent of the companies reported exercising due diligence on the source and chain of custody of conflict minerals used, but 67 percent weren't able to determine whether those minerals came from the Democratic Republic of Congo or adjoining countries.
None of the companies were able to determine whether the minerals financed or benefited armed groups in those countries, GAO said.
The SEC conflict mineral disclosure rules, enacted under the 2010 Dodd-Frank Act, require companies and foreign issuers in the U.S. to report using “conflict minerals” if they are necessary to a product the companies make. Conflict minerals include gold, tantalum, tin and tungsten from the Democratic Republic of Congo and neighboring countries (163 DEN A-7, 8/23/12).
About 1,300 Companies File
About 1,315 companies filed their first submissions in 2014 disclosing their use of the minerals the year before.
Companies that disclosed that conflict minerals in their products came from covered countries—4 percent—“indicated that they are or will be taking action to address the risks associated with the use and source of conflict minerals in their supply chains.”
GAO didn't make any recommendations in the report.
The GAO report was released about two weeks after research conducted by the consulting firm Assent Compliance and a Tulane University graduate student reached similar conclusions, stating that most companies struggled to determine whether their products contain minerals from areas of conflict in Africa (150 DEN A-12, 8/5/15).
Commenters recently told Bloomberg BNA that conflict minerals disclosures have improved this year (109 DEN A-18, 6/8/15).
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Conflict Minerals Rule Still Violates First Amendment
Aug 19, 2015 | BNA Daily Environment Report
By Rob Tricchinelli
A federal appeals court concluded for the second time Aug. 18 that part of the Securities and Exchange Commission's conflict minerals disclosure rule, required under the Dodd-Frank Act, violates the First Amendment (Nat'l. Assoc. of Mfrs. v. SEC, D.C. Cir., No. 13-5252, 8/18/15).
The rule requires companies to disclose whether raw materials in their supply chain are “conflict free,” and a three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit held that to be an unconstitutional compelled disclosure.
The court first struck down the rule on First Amendment grounds in April 2014 (72 DEN A-9, 4/15/14).
The panel agreed to rehear the case in light of an intervening decision that applied a looser standard of First Amendment review for government-imposed disclosures on companies (223 DEN A-6, 11/19/14).
In its Aug. 18 decision, the D.C. Circuit held that the looser standard of review, outlined by Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626 (1985), still didn't apply to the Securities and Exchange Commission rule.
Even if it did, and “if the compelled disclosures here are commercial speech,” Judge A. Raymond Randolph wrote for the majority, “we still believe that the statute and the regulations violate the First Amendment.”
Rule's Requirements
Under the rule, companies must tell the SEC and post on their website if their products are “DRC conflict free,” meaning their conflict minerals didn't “directly or indirectly finance or benefit armed groups” in applicable countries, including the Democratic Republic of the Congo.
The National Association of Manufacturers, the U.S. Chamber of Commerce and the Business Roundtable sued the agency, and the case went through several courts before ending up in the D.C. Circuit. The trade groups challenged the rule on First Amendment grounds and on the agency's cost-benefit analysis in creating it.
The same three-judge panel struck down part of the rule in April 2014, using a rigorous standard of First Amendment review. It upheld the SEC's use of cost-benefit analysis and the requirements for businesses to conduct due diligence on finding conflict minerals in their supply chain and reporting those to the SEC.
The disclosure requirement regarding whether products are “conflict free” is what drew higher First Amendment scrutiny.
Court Asked to Apply Zauderer Standard
The SEC had asked the court to apply the standard from Zauderer, but the panel concluded that the standard only applies to government attempts at “preventing consumer deception.”
In July 2014, the full D.C. Circuit said that Zauderer could apply in cases where other government interests were involved. Based on that ruling, the agency asked the original panel to rehear the case.
On rehearing, the majority used the same rigorous standard but said that even if the lower standard applied, it would rule the same way.
The court was skeptical of the government's argument that increased disclosures would help reduce humanitarian problems in conflict-minerals countries. “Evidence throws further doubt on whether the conflict minerals rule either alleviates or aggravates the stated problem,” it said.
Even the rule and statute's definition of “conflict free” are problematic, the court said. Upholding the definition could allow the government “to skew public debate by forcing companies to use the government's preferred language,” it said. It compared this “governmental redefinition” to the “war is peace, freedom is slavery, ignorance is strength” mantras from government leaders in George Orwell's 1984.
Judge Sri Srinivasan dissented. He disagreed with Randolph and Judge David B. Sentelle on the First Amendment claims in the first case as well.
Further Review?
“We are reviewing the decision,” an SEC spokesman told Bloomberg BNA, without commenting on whether the agency would seek further review.
The agency had previously sought rehearing by the full D.C. Circuit, which dismissed the request as moot Aug. 18. The panel's decision would restart the clock on the agency's ability to seek full-circuit review, the court said in a separate order.
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Appeals Court Upholds Ruling Voiding Part Of SEC’s Conflict-Minerals Rule
Aug 18, 2015 | PoliticoPro
By Patrick Temple-West
A federal appeals court on Tuesday upheld a decision voiding a piece of the SEC’s “conflict minerals” rule mandating that companies disclose whether their products include minerals from central African war zones.
The U.S. Court of Appeals for the District of Columbia dismissed petitions for a rehearing of an April 2014 ruling that was a partial win for business groups that had challenged the disclosure requirement.
In that April decision, a three-judge appeals court panel said the SEC’s requirement that firms report that their products have “not been found to be ‘DRC conflict free’” violated free-speech protections. As a result, the SEC stayed part of the reporting requirement for the rule. Companies must still determine whether their products contain conflict minerals and issue reports on their findings.
“In our view, this decision today not only reaffirms last year’s decision, but does so in a stronger way by elaborating why this disclosure violates the first amendment,” said Tom Quaadman a vice president at the U.S. Chamber of Commerce, which filed the initial court challenge with other business groups.
An SEC spokeswoman said the agency is reviewing the decision. The agency still has the right to appeal today’s ruling.
The SEC in August 2012 adopted the rules, which require companies disclose their use of conflict minerals from the Democratic Republic of the Congo. The Chamber of Commerce has fought against implementation of the rules, while Amnesty International has advocated for them.
In a separate development, the Government Accountability Office on Tuesday released a report on the rule with data from 2014, the first full year companies were required to make disclosures.
Two-thirds of the companies the GAO polled said they could not determine if their minerals came from the Democratic Republic of the Congo or adjoining countries, and only 4 percent of companies said they knew for certain their minerals came from the countries covered by the rule. None of the companies could say for certain whether the minerals financed terrorists in those countries, the GAO said.
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GAO: Most Companies Unable To Track Down 'Conflict Minerals'
Aug 18, 2015 | The Hill - Policy
By Peter Schroeder
Less than half of all companies required to track down the source of key minerals potentially central to war-torn parts of Africa have been able to do so, according to a new government study.
The Government Accountability Office (GAO) reported on Tuesday that 67 percent of companies that rely on so-called “conflict minerals” to make products have been unable to determine whether their supply has come from parts of Africa where armed groups profit from their production.
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The Securities and Exchange Commission (SEC) wrote rules in 2012 requiring companies that rely on gold, tantalum, tin or tungsten to try and determine whether their minerals came from the Democratic Republic of the Congo or adjoining areas. The new rules were mandated by the Dodd-Frank financial reform law, and were aimed at curbing the use of minerals from conflict-torn regions of Africa, in an effort to deprive funds from militant groups in the region.
But the GAO found that so far, the results have been underwhelming. Of the 33 percent of companies that were able to determine where their minerals came from, 24 percent said they did not come from the region in question. Three percent did not say where the minerals came from, two percent said they relied on scrap or recycled sources, and just four percent said their minerals came from the troubled area.
Of the small sampling that did admit to using conflict minerals, those companies said they were taking steps to address the matter, such as requiring suppliers to certify using conflict-free minerals in the future, or seeking other suppliers for business.
GAO said that the companies that were unable to identify the point of origin for their minerals often complained of a complex chain of suppliers that made it difficult to nail down the information.
While 99 percent of companies made inquiries about the source of those minerals, less than half said they received responses from suppliers on the matter. Others said their suppliers were unable to provide the information, or provided incomplete information.
Even among the small sampling of companies that reported using minerals from conflict regions, no company was able to determine if the purchase of those minerals financed armed groups in that region.
Under original SEC rules, companies would have been required to publicly disclose their findings, but that portion of the rule was struck down by a D.C. court.
GAO examined a sample of 147 reports from companies, out of more than 1300 that have so far been filed.
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UMass Sets New Record For Patents In 2015
Aug 18, 2015 | Boston Globe
By Jack Newsham
The pace of innovation at the University of Massachusetts is picking up.
UMass landed 65 patents in the 12 months ending June 30, a record for the five-campus university system and a 20 percent jump from the 54 posted in fiscal 2014. That figure includes some of the 40 patents the university received in 2014, a stat that ranked UMass 40th nationally for patents received, the school said today.
Patents can be quite lucrative for universities. UMass earned $34 million from licensing its research in its last fiscal year, almost a 10 percent boost from the $31 million recorded the year before. Over the same period, UMass said its researchers filed 138 new patent applications.
“Cutting-edge research by our faculty puts us in the upper echelon of universities nationally and makes UMass a leader in innovation,” said Marty Meehan, UMass’s president, in a news release. That research, he said, “plays a critical role for our state and will determine our fortunes as we compete in the global economy.”
The technologies patented by the university covered a broad range of fields, including agriculture, plastics engineering, and clean air technologies. One patent, granted last summer, is for a less toxic flame-retardant chemical that could be used as traditional, hazardous chemicals are phased out;another describes a way to control robots with a touch-screen interface, instead of the usual array of joysticks, buttons, and switches.
Despite its record progress, UMass isn’t at the top of the heap. The Massachusetts Institute of Technology made $78 million in licensing income in its 2014 fiscal year, according to its website, and its researchers received more than 300 patents. MIT researchers also filed 401 new patent applications that year, more than double the UMass figure for last year.
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Regulatory, Science Workshops Announced by ECHA, EPA
Aug 19, 2015 | BNA Daily Environment Report
By Pat Rizzuto
Chemical and product manufacturers will get tips on completing their authorization applications during a November workshop the European Chemicals Agency (ECHA) recently announced.
Pesticide companies can get information about the European Union's Biocidal Products Regulation at a previously announced Sept. 1 ECHA workshop intended primarily to help companies get information about their roles and obligations under the law.
Through e-mails and newly posted online information, ECHA and the U.S. Environmental Protection agency also announced a series of science and risk assessment workshops later this year and in early 2016.
The science and risk assessment workshops both agencies will hold address epigenetics, the ecological risks of chemicals in soil and other issues affecting regulatory decisions about chemicals and pesticides.
ECHA Workshops
Registration has closed for the Sept. 1 Biocides Stakeholders' Day, but interested parties can watch it online, according to information ECHA has posted.
The Nov. 17 Authorization Applications Workshop is open to interested parties who register in advance. ECHA also will stream it live.
ECHA and the European Food Safety Authority will host a by-invitation-only scientific workshop onsoil risk assessment Oct. 7-8.
“An anticipated outcome of this workshop is the emergence of new or improved approaches which may be applied in the implementation of the relevant European regulations,” the agency said. Topics include:
• similarities and differences in current regulatory schemes focusing on industrial chemicals (REACH), biocides and plant protection products, with the goal of identifying ways those regulations can enhance each other;
• identification of ecological effects important for organisms in soil that are exposed to chemicals or pesticides;
• development of new ways to assess ecological risks when chemicals and pesticides are applied to or deposited on soil and how those new approaches could be applied in regulations.
New approaches in regulatory science is the topic of the final April 19-20 workshop ECHA announced.
Topics include ways to improve “read-across” methods, which apply data from one chemical to a similar compound for purposes such as filling data gaps.
The workshop also will discuss divergent approaches governments are using to screen large numbers of chemicals to identify a smaller quantity for further scrutiny, to obtain additional information about or for other purposes.
ECHA invited individuals with a professional expertise and interest that would like to attend the workshop to contact the agency by Sept. 20.
EPA Workshops
The EPA invited industry, environmental health, government and academic scientists and risk assessors to attend its workshops by registering in advance. The EPA's workshops are:
• Epigenetics and Cumulative Risk Assessment, Sept. 2-3. Topics include ways epigenetic changes—genetic alterations that may lead to cells and cell systems responding differently in future generations but do not alter a person's DNA code—may affect cumulative risk of disease in human populations exposed to multiple stressors.
• Advancing Systematic Review, Dec. 16-17. The workshop will focus on current approaches to using systematic review to obtain scientific information, to evaluate that information and then to integrate it so conclusions can be reached about, for example, the hazards posed by one or more chemicals. The workshop aims to provide information for the EPA's Integrated Risk Information System (IRIS) program, which is working to implement systematic approaches for its toxicological reviews.
• Temporal Exposure Issues for Environmental Pollutants, Jan. 27-29, 2016. Subtitled Health Effects and Methodologies for Estimating Risk, the workshop will discuss how the time of exposure to diverse pollutants may affect the potential to contract cancer or other diseases.
• Characterizing and Communicating Uncertainty in Human Health Risk Assessment, early 2016. The workshop will focus on how estimates of uncertainty and variability are used, how to determine what information is most useful in decision making, what practical approaches would meet user needs and how to estimate how confident a risk assessor is in a conclusion.
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U.S. Envoy Defends Arctic Oil Exploration
Aug 19, 2015 | BNA Daily Environment Report
By Alan Kovski
Exploration for offshore oil in the Arctic is supported by the Obama administration as a pragmatic development that aims for a balance between economic development and environmental protection, an administration special envoy said Aug. 18.
Robert Papp, the State Department special representative for the Arctic, told an audience at the Heritage Foundation that as long as Arctic maritime development occurs in a safe and responsible manner, it is a good idea to spread the benefits of prosperity in Arctic regions.
Royal Dutch Shell Plc is exploring for oil in the Chukchi Sea north of Alaska. “I think they are as prepared as they can be,” Papp said of the Shell team.
Papp, a retired U.S. Coast Guard admiral, declined to comment on a remark earlier in the day by Hillary Clinton, who tweeted, “The Arctic is a unique treasure. Given what we know, it's not worth the risk of drilling.”
The discussion of the Arctic's economic potential looked especially at the issue of infrastructure among the eight nations of the Arctic Council, an international policy body that occupies a substantial portion of Papp's time. He cited Tromso, Norway, and Iceland as examples of well-developed locales in or near the Arctic, in contrast to Alaska, which lacks much of the needed infrastructure.
Icebreakers Wanted ‘First and Foremost.'
Papp said the development of Alaska's Arctic potential needs, “first and foremost,” more icebreakers.
The Coast Guard has only two icebreakers, the Polar Star and the Healy, available for work in the Arctic. “I would like to see us building at least one,” Papp said.
Alaska also lacks a deepwater port in the Arctic. The U.S. Army Corps of Engineers has a plan to deepen the port of Nome to 28 feet from 22 feet, but it is unlikely to get much deeper because of rock layers, Papp said. Nome is a little south of the Bering Strait and the Arctic Circle.
Just a little farther south is Port Clarence, with a great natural deepwater harbor but in need of roads and other infrastructure, Papp said. Other infrastructure includes fiber optic cable, invaluable for high-speed internet access and absent in most Alaskan coastal communities, with the exception of Prudhoe Bay.
For the offshore, Papp said something as basic as better charts of the subsurface would be valuable. The icebreaker Fennica, leased by Shell for its Chukchi Sea work, received a nine-foot crease in its hull from an uncharted reef near Dutch Harbor, Alaska, he noted.
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Republicans Knock Clinton on Arctic drilling, Keystone
Aug 18, 2015 | The Hill - E2 Wire
By Devin Henry
Republicans hit Hillary Clinton for her Tuesday tweet opposing oil drilling in the Arctic Ocean, tying it to her refusal to say where she stands on the Keystone XL pipeline.
Clinton tweeted that drilling in the Arctic is “not worth the risk,” echoing many environmentalists who say a potential oil spill there would be devastating to the area’s ecosystem and especially hard to clean up.
Republicans said Clinton, the front-runner for the Democratic presidential nomination, should also say where she stands on the Keystone pipeline, something she has resisted because of her role in early Obama administration reviews of the project.
“Hillary Clinton’s politically-motivated silence on the Keystone pipeline is even more untenable in the face of her opposition to yet another job-creating energy project,” Republican National Committee spokesman Michael Short said in a statement. “Once again, Hillary Clinton is reminding voters she’ll say or do anything to get elected.”
Republican presidential candidates took aim as well.
“Still waiting to hear your position on Keystone…” New Jersey Gov. Chris Christie tweeted to Clinton.
Former Florida Gov. Jeb Bush moved beyond Keystone, and said Clinton was “wrong” on Arctic drilling.
“Being more-anti energy than Obama is extreme,” Bush tweeted to Clinton. “We should embrace energy revolution to lower prices & create US jobs.”
Green groups that blasted President Obama on Monday for allowing Royal Dutch Shell to drill for oil in the Arctic praised Clinton for coming out against the plan.
“Hillary Clinton got it right on the Arctic,” Greenpeace USA executive director Annie Leonard said. Greenpeace activists have led protests against the drilling plan and worked to physically block important equipment from reaching Shell's drilling site in the Chukchi Sea.
“Shell and President Obama have ignored the world’s best scientists, as well as millions of people around the world, who have all said repeatedly that the melting Arctic is a dire warning, not an invitation. The next President will be responsible for saving the Arctic, so it’s vital we hear where all the candidates stand.”
Michael Brune, the executive director of the Sierra Club, said Clinton is “standing up for what science, the will of the American people and common sense demand.”
“She’s exactly right: everything we know about dangerous oil drilling in the Arctic indicates it imperils a national treasure and is guaranteed to make our climate crisis worse,” he said.
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Hillary Clinton: Arctic Drilling 'Not Worth The Risk'
Aug 18, 2015 | The National Journal
By Clare Foran & Ben Gemen
A day after the Obama administration gave Shell the green light to search for oil in icy Arctic waters, Hillary Clinton took to Twitter to voice her disapproval.
A spokesman for the Clinton campaign confirmed to National Journal that Clinton's tweet indicates that she opposes Arctic offshore oil-drilling.
Her announcement drew quick criticism from Jeb Bush, one of the major candidates for the GOP presidential nomination, a sign that energy policy will be a political battleground in the 2016 election.
"Wrong," Bush said on Twitter in response to Clinton. "Being more-anti energy than Obama is extreme. We should embrace energy revolution to lower prices & create US jobs."
But Clinton's definitive stand is sure to please environmentalists who want the Democratic front-runner to take a tougher line on fossil-fuel development than President Obama has—who, despite making action to tackle climate change a key priority, has long voiced support for an "all of the above" energy strategy.
The Sierra Club was quick to applaud Clinton while keeping pressure on the 2016 contender to translate her words into concrete action. "We applaud Secretary Clinton for standing up for what science, the will of the American people and common sense demand," Sierra Club executive director Michael Brune before calling on the next president to deny "Shell's application to commercially drill in the Arctic."
In July, Clinton expressed "doubts" over Arctic drilling, saying, "I don't think it is a necessary part of our overall clean-energy climate-change agenda," in an interview with NH1 News.
But the 2016 contender's silence on hot-button environmental issues, such as whether the controversial Keystone XL oil-sands pipeline should be approved, has frustrated environmentalists who fear that she will not do enough to rein in the greenhouse gases that scientists say are driving global warming.
Questions over where exactly Clinton stands on Arctic drilling have also proved to be a sore subject in the campaign's relationship with the climate movement.
Clinton has also long opposed onshore drilling for oil in the Arctic National Wildlife Refuge.
The candidate's democratic 2016 challengers on the Left, Bernie Sanders and Martin O'Malley, both oppose Arctic drilling.
But Clinton's comment nevertheless marks a key break with Obama, whose Interior Department this week gave long-sought permission to Shell to drill into oil-bearing zones in the Chukchi Sea off Alaska's northern coasts. The company had already begun preliminary drilling work.
Federal regulators estimate that the Chukchi Sea could hold more than 15 billion barrels of recoverable oil and large natural-gas resources, too. And the adjoining Beaufort Sea is believed to have huge subsea hydrocarbon pools, too.
But green groups strongly oppose drilling in the Arctic region, which is home to polar bears, bowhead whales, and other endangered or fragile species, arguing that it's too difficult to contain potential spills despite Shell's claim of robust safety and response measures.
Beyond long-standing fears over the potential for a catastrophic spill, the Arctic drilling fight has more recently become part of a much broader battle over climate change.
In May, environmental activist and founder of the grassroots green group 350.org Bill McKibben slammed Obama's decision to let Shell drill for Arctic oil in a New York Times op-ed, calling it another form of "climate denial."
"The Obama administration's decision to give Shell Oil the go-ahead to drill in the Arctic shows why we may never win the fight against climate change. Even in this most extreme circumstance, no one seems able to stand up to the power of the fossil-fuel industry. No one ever says no," McKibben wrote.
Companies including ConocoPhillips and Statoil hold Arctic offshore leases that they have not yet sought to develop. While Shell is the only company currently seeking to drill offshore in the U.S. Arctic, Clinton's stance will likely have broader effects on the industry if elected.
"When she said that given what we know now, offshore drilling in the Arctic is not worth the risk, she was referring to both new and existing leases," a campaign aide said.
Obama's Arctic offshore policies have sought to blend new protections with limited development.
The Interior Department is crafting new oil-spill prevention and response rules for companies operating in Arctic waters off Alaska's coast.
New Arctic lease sales are tentatively scheduled in 2016 and 2017, and a draft Interior Department plan released early this year also envisions auctions of drilling rights in Arctic waters in 2020 and 2022. However, Obama has also placed major areas of the Arctic seas off-limits.
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EPA Proposes Methane Limits for New Oil, Gas Wells
Aug 19, 2015 | BNA Daily Environment Report
By Andrew Childers and Patrick Ambrosio
The Environmental Protection Agency proposed the first-ever methane emissions standards for new oil and natural gas wells, but environmental groups said rules are needed for existing facilities as well if the Obama administration plans to meet it goal to curb emissions of the pollutant.
The proposal (RIN 2060-AS30), released Aug. 18, would update the new source performance standards for the industry to require new and modified oil wells to capture methane and volatile organic compounds using reduced emissions completion techniques, known as green completions. In addition, the rule would set methane and volatile organic compound emissions limits for pneumatic pumps and for fugitive emissions from wells sites and compressor stations, which had not been covered when the performance standards were last amended in 2012.
The rule also would add methane standards for hydraulically fractured gas wells and equipment leaks at natural gas processing plants, which were already subject to volatile organic compounds emissions limits as part of the EPA's 2012 performance standards. However, those sources will not be required to install any additional pollution controls, the agency said.
Janet McCabe, the EPA's acting assistant administrator for air and radiation, told reporters Aug. 18 that the latest proposal builds on the prior 2012 rule.
“We're not starting from scratch with these rules. We're building on a strong foundation,” she said.
McCabe said the prior standards, which did not directly regulate methane, already have produced significant emissions reductions through other required controls. Methane emissions from the oil and natural gas sector declined by 12 percent between 2011 and 2013 as those prior standards took effect. The largest reductions came from hydraulically fractured oil wells, which saw their emissions decrease by 73 percent during that period.
Industry Calls Requirements ‘Redundant.'
The petroleum industry argued that emissions decline shows the EPA's proposed performance standards are unnecessary.
“We need good public policies that don't involve redundant regulations,” Howard Feldman, director of scientific and regulatory policy at the American Petroleum Institute, told reporters Aug. 18.
Though well operators already use many of the emissions controls being proposed by the EPA, the performance standards would impose additional compliance requirements, Kathleen Sgamma, vice president of government and public relations at the Western Energy Alliance, said.
“Now we have to do it in a certain way, and we have to do a lot of paperwork to show we're doing it,” she told Bloomberg BNA.
Harry Weiss, a partner at Ballard Spahr LLP who advises oil and gas companies, said the proposed performance standards would most significantly impact transmission companies.
“The principal impact would be on the mid-stream companies that operate transmission lines because they have a requirement to fix and repair leaks,” he told Bloomberg BNA Aug. 18.
Standards Part of Package of Rules
The proposed performance standards were part of a package of rules and guidance the EPA announced Aug. 18. The EPA also issued draft control techniques guidelines to help states reduce emissions as well as a proposal (RIN 2060-AS06) to clarify permitting requirements for oil and natural gas wells and a federal implementation plan for minor source oil and gas wells on Indian lands.
The EPA estimates its proposal will reduce emissions of methane—a potent but short-lived greenhouse gas—by between 340,000 short tons and 400,000 short tons by 2025. The standards are projected to cost the industry between $320 million and $420 million, McCabe said.
The proposal is part of the Obama administration's methane strategy to curb emissions of the pollutant by as much as 45 percent by 2025 (10 DEN A-1, 1/15/15).
McCabe said the agency's 2012 standards combined with the latest proposal will reduce emissions by between 20 percent and 30 percent.
Standards Sought for Existing Sources
Environmental groups said regulating methane emissions from the existing facilities will be critical for meeting that target. However, the agency has given no indication when it might issue those rules.
Kate DeAngelis, climate and energy campaigner at Friends of the Earth, called that “a major gap within this rule.”
As part of the administration's methane strategy, the Interior Department's Bureau of Land Management is to propose new standards to reduce venting, flaring and leaks of natural gas from new and existing oil and natural gas wells on public lands. The EPA could package its proposed standards for existing oil and gas wells with that rule, DeAngelis, told Bloomberg BNA Aug. 18.
If the EPA fails to act on existing sources once it completes its proposed new source performance standards, environmental groups could pursue lawsuits to force the agency to issue the standards.
“I definitely think that's something we'd consider in the long term,” DeAngelis said.
McCabe repeatedly declined to say when the EPA might regulate methane emissions from existing oil and gas wells. Instead, McCabe highlighted the agency's recent “methane challenge” that would encourage oil and gas companies to commit to voluntary methane reduction targets that would be reported to the EPA through the annual greenhouse gas reporting requirements (142 DEN A-1, 7/24/15).
The oil and gas industry said it favors voluntary measures to control methane emissions, because producers already have incentives to capture as much of the product as possible.
“We don't feel like we need EPA to come in and tell industry how to capture methane,” Feldman said.
EPA Seeks to Define Sources
With the proposed performance standards, the EPA is also proposing to clarify permitting requirements for the oil and natural gas industry. The proposal seeks to determine whether the various components of an oil and gas production facility, which can be spread over significant distances, should constitute a single emissions source or several smaller sources.
The EPA is seeking comment on two different definitions of “adjacent” in the context of oil and natural gas permitting. The first would definite adjacent in terms of proximity between components while the second definition would consider whether those facilities and activities are linked.
A broader reading of adjacent that aggregates together the various components of production network would mean more oil and gas facilities would be deemed major sources of emissions and subject to more stringent new source review, prevention of significant deterioration and Title V permitting requirements, Sgamma said.
“Everybody in their right mind knows what adjacent is. It's not 20 miles away,” she said.
Draft Control Guidelines Released
The EPA Aug. 18 also issued a set of draft guidelines for the control of emissions of volatile organic compounds, an ozone precursor, from existing oil and gas facilities.
The guidelines, which the EPA said do not impose any legal requirements on sources, are intended to be used to meet ozone precursor control requirements in certain nonattainment areas.
States can consider the guidelines in determining what constitutes reasonably available control technology (RACT) for controlling volatile organic emissions from covered processes and equipment, though states have the flexibility to use different emissions control approaches. RACT requirements apply in moderate and severe ozone nonattainment areas and throughout the Ozone Transport Region, which encompasses 11 states and the Washington, D.C., metropolitan area.
The draft guidelines include information on the costs of available technology that could be used to control storage vessels, compressors, pneumatic pumps and other sources of volatile organic compound emissions. The EPA included model rule language in the draft guidelines that states could directly adopt if they wish to address their volatile organic compound control requirements using the EPA's recommendations.
The EPA projected that the draft guidelines would cut volatile organic compound emissions by about 82,000 tons per year at an annual cost of $76 million if affected states chose to fully implement the recommendations.
Feldman of the API said the reach of the draft guidelines will depend on where the EPA sets the national ambient air quality standards. The agency is under an Oct. 1 deadline to decide whether to revise or retain the current 75 parts per billion standards. If the agency tightens those standards, the draft guidelines would be “more extensively applied” than projected because there would be more nonattainment areas, Feldman said.
Database Now Available
The Environmental Council of the States launched a database of best practices, regulations, protocols and voluntary programs that are used to reduce emissions from the natural gas sector.
The database, known as the ECOS Methane and Air Toxics Reduction Information Exchange, is intended to promote interstate and interagency coordination on the issue of methane and VOC reduction, the organizations said in an Aug. 18 news release. The EPA, Department of Energy, American Gas Association and Environmental Defense Fund are among the organizations that partnered with ECOS to launch the database.
Republicans Pan Rule
Congressional Republicans predictably panned the proposal as impeding development of domestic energy sources. They said the requirements are unnecessary at a time when methane emissions from the oil and natural gas sector are already declining.
“Instead of conspiring with extreme environmental interests, EPA should stop punishing cooperative industry stakeholders and start partnering with them in their current efforts to capture methane in a responsible manner,” Rep. Lamar Smith (R-Texas), chairman of the House Science, Space, and Technology Committee, said in an Aug. 18 statement.
Sen. James Inhofe (R-Okla.), chairman of the Senate Environment and Public Works Committee, said the EPA's proposal imposes new costs on the oil and gas industry without providing significant climate change benefits.
“The minuscule fraction of greenhouse gas emissions made up by methane emissions from oil and gas production makes this yet another regulation from the Obama administration that will have no tangible impact on reducing greenhouse gas emissions,” he said in a statement.
Inhofe pledged “rigorous oversight” of the rule.
Rep. Rob Bishop (R-Utah), chairman of the House Natural Resources Committee, said the EPA's proposal “flies in the face of technological reality.” He accused the EPA of using the rule to inhibit new fossil fuel production.
“The truth is that while the oil and natural gas industry has greatly increased production on state and private lands, methane emissions have actually fallen,” he said in a statement. “This proposal is another unprecedented attack aimed at federal control of our nation's energy production, with the goal of stopping new production.”
Sen. Sheldon Whitehouse (D-R.I.) defended the proposal as a “sensible, cost-effective step.”
“As we replace coal with natural gas, it's important to reduce methane leakage,” he said in a statement. “Industry has been dragging its feet in implementing solutions, so EPA is stepping in with sensible requirements.”
Emissions Underestimated
The EPA may be underestimating the scale of methane emissions from the oil and gas sector, according to research funded by the Environmental Defense Fund. The group has put out a series of studies looking at how much and from where methane is escaping across the oil and gas supply chain, including facilities that gather natural gas from well sites across the U.S.
Though these facilities have been largely uncounted in federal data, they may actually be the biggest source of methane in the natural gas supply chain, the EDF's latest research suggests.
The research, published Aug. 18, showed gathering facilities emit about 100 billion cubic feet of natural gas each year—roughly eight times previous estimates from the EPA. Meanwhile, emissions at natural gas processing facilities are lower than the EPA's inventory, it said.
Environmental groups have used that research to call on the EPA to set stringent methane limits for the sector, particularly for existing facilities (159 DEN A-2, 8/18/15).
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EPA Rules Target Methane From Oil, Gas Drilling
Aug 18, 2015 | PoliticoPro
By Elana Schor
The Obama administration on Tuesday rolled out a proposal to curb the oil and gas industry’s methane emissions that it billed as the latest step in a more ambitious plan to curtail the sector’s emissions.
The next step remains a mystery.
EPA said Tuesday that its proposed rules are expected to reduce methane leaks from oil and gas fracking operations by 30 percent by 2025 compared to 2012 levels. That’s about two-thirds of the way toward the goal President Barack Obama outlined in January, to cut oil and gas methane emissions by between 40 and 45 percent over the next decade.
But the methane rules will not be finalized until at least next year, and it is unlikely that EPA would have time to complete additional ambitious regulations on the oil and gas sector before the president leaves office.
Environmentalists greeted the rules for new operations with calls for EPA to quickly pivot to regulating existing oil and gas wells and gathering and processing equipment. But the agency’s acting air chief, Janet McCabe, declined to discuss specifics in response to repeated questions Tuesday on how the administration would set the oil industry fully on track towards the 2025 goal.
“We are not ruling anything out,” McCabe said on a press call. EPA is “taking this in a stepwise fashion.”
The administration’s proposal managed to please neither side of the heated debate over cutting emissions of methane, a greenhouse gas more than 20 times as potent as carbon dioxide. Oil and gas producers argue that the rules are unnecessary because methane emissions from fracking already are on the decline, while greens said EPA is ignoring the most important source of the industry’s emissions by failing to regulate existing sources.
“EPA’s own data show that methane emissions from fracking are already rapidly declining as production has skyrocketed,” said Katie Brown, spokeswoman for the industry-backed Energy in Depth project. “Federal regulations, especially if crafted poorly, could inflict more pain on the men and women who work in the oil and gas industry — at a time when market forces are already creating economic challenges.”
Environmental Defense Fund President Fred Krupp spoke for many climate activists in asking EPA point-blank how it planned to meet its own long-term goals: “The question to ask of any proposal is how far does it take us toward achieving a 45 percent reduction, and how quickly does it get us there?”
The Sierra Club’s fuels campaign director, Lena Moffitt, said her group’s analysis showed the administration could cut methane from the oil and gas sector by as much as half over the next decade through “stringent rules” for existing leaks, compressors, pneumatic devices, liquids unloading and well completions.
EPA released four rules as part of the proposal Tuesday. The marquee rule for new and modified sources would require drillers to use green completions on oil and gas wells and upgrade processing and gathering equipment to reduce methane leaks, among other requirements. That expands a 2012 rule for new gas wells and extending it to oil wells as well as several common sources of methane leaks, including compressors and pneumatic pumps.
The regulations also address existing oil and gas wells in regions with excessive ozone pollution, define when to require permits for adjacent wells and set methane limits as well as new permitting guidelines for drillers operating on Indian land. They all are subject to a 60-day public comment period and are scheduled to be finalized next year, according to the administration’s regulatory agenda.
Senate Environment and Public Works Chairman Jim Inhofe (R-Okla.), one of EPA’s fiercest critics, vowed to hold an oversight hearing on the methane plan this fall.
On the presidential campaign trail, Democratic hopeful Sen. Bernie Sanders echoed green groups in calling the plan “an important step” while adding that “we must do more to tackle the crisis of climate change.”
Oil and gas development is the single largest domestic generator of methane, which makes up an estimated 9 percent of U.S. greenhouse gas emissions. But EPA’s proposal would actually trim less methane than a proposal the agency released to far less fanfare on Friday that would crack down on the third-largest source of methane emissions, municipal landfills.
The oil and gas measure will prevent up to 363,000 metric tons of methane in 2025, the equivalent of 9 million metric tons of carbon dioxide, according to EPA.
But the landfill proposal, which updates standards first set in 1996, would reduce methane emissions by 436,000 metric tons in 2025, or the same as about 10.9 million metric tons of CO2.
Each rule would cut a few thousand tons of air toxics such as benzene and toluene, according to EPA.
The two rules also have unique side benefits. The oil and gas regulation will cut out up to 180,000 tons of volatile organic compounds, which contribute to forming ozone, in 2025. And EPA says its landfill rule will lead to a net reduction of 238,000 metric tons of carbon dioxide as electricity demand drops because of power gained from landfill gas.
EPA recently declined to go after emissions from another major source. The agency in 2013 rejected a request from green groups to regulate methane emissions from coal mining, the fourth biggest source in the U.S.
The agency said it did not have the time or resources to write such a rule, a position laterbacked up by a federal court. But the door was left open for EPA to one day revisit its decision.
Other major sources of U.S. methane are livestock such as cows and stockpiles of manure from other farm animals.
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With Proposed Limits On Methane, Epa Takes Aim At A Powerful Greenhouse Gas
Aug 19, 2015 | The Washington Post
By Joby Warrick
The Obama administration outlined plans on Tuesday for sharply reducing emissions of methane gas from oil and gas operations, taking aim at a potent greenhouse gas that studies suggest is playing an accelerating role in the Earth’s warming.
A proposed rule announced by the Environmental Protection Agency seeks to slash methane pollution from the nation’s energy sector, in part by requiring emissions controls on new hydraulic fracturing or “fracking” operations and by curbing leaks from pipelines and storage tanks, agency officials said.
The proposed measure, which faces heavy opposition from fossil-fuel companies, represents the first effort by the EPA to directly regulate emissions of methane, the primary component in natural gas. As a greenhouse gas, methane is 25 times as potent as carbon dioxide in trapping heat in the atmosphere.
EPA officials said the proposed rule builds on previous efforts to reduce air pollution, while also helping energy companies recover and sell methane that otherwise would be allowed to escape into the atmosphere.
“We can continue to accelerate the transition to a clean-energy economy by capturing fuel that would otherwise be wasted, while also preventing pollution that harms our climate and the health of our families and communities,” Janet McCabe, the EPA’s acting assistant administrator for the Office of Air and Radiation, told reporters in announcing the measure.
The proposal’s formal unveiling comes seven months after the agency announced its intention to cut methane emissions from the oil and gas sector with the aim of ultimately achieving reductions of 40 percent to 45 percent by 2025, compared with 2012 levels. The oil and gas industry accounts for 30 percent of the methane released from U.S. sources each year, much of it resulting from leaks from drilling rigs, pipelines and storage tanks, agency officials say.
In addition to requiring pollution controls on new equipment, the new restrictions would apply to existing oil and gas operations in parts of the country with high levels of air pollution, agency officials said. The EPA predicts that the rule would cost the industry $320 million to $420 million by 2025, with the costs being offset by savings of up to $550 million in preventing illnesses related to air pollution and climate change.
Industry officials criticized the proposal, saying the EPA was imposing more costs on oil and gas companies without taking into account industry efforts to reduce emissions through voluntary measures. Energy companies already have a strong financial incentive to avoid wasting methane, said Jack Gerard, CEO of the American Petroleum Institute, a trade group.
“The oil and gas industry is leading the charge in reducing methane,” Gerard said. “The last thing we need is more duplicative and costly regulation that could increase the cost of energy for Americans.” He said emissions from hydraulically fractured natural gas wells have fallen nearly 79 percent in the past decade, “due to industry leadership and significant investments in new technologies.”
Environmental groups voiced support for the proposal, though some said the measure would not achieve the kinds of emissions cuts that the EPA has projected.
“The nation’s oil and gas companies emit over 7 million tons of methane pollution every year, equal to the greenhouse gas pollution of about 160 coal-fired power plants over the next 20 years,” said Fred Krupp, president of the nonprofit Environmental Defense Fund. While the EPA’s proposal is a first step, “additional actions by government are needed to achieve this goal,” Krupp said.
The EPA’s announcement coincided with a study that suggests that the industry’s contributions to methane pollution far exceed official estimates.
The study, in the journal Environmental Science and Technology, said methane leaks from processing and storage facilities were three times as high as the EPA’s data suggests. The study, by 11 scientists from Colorado, Pennsylvania and Massachusetts, based its conclusions on new measurements taken from more than 140 natural gas facilities in 13 U.S. states. The EPA’s figures are derived in part from the industry’s own estimates.
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EPA Targets Host Of Oil & Gas Methane Sources But Backs Existing Controls
Aug 18, 2015 | InsideEPA
By Bridget DiCosmo
EPA's first-time rules regulating methane emissions from the oil and gas sector target a range of “new” sources that environmentalists are hoping will eventually be regulated in a future rule for existing sources, but the plan also appears to allow newly regulated sources to comply using controls that are already required by sources that are subject to the agency's 2012 rules for the sector.
The proposed new source performance standards (NSPS), issued Aug. 18 alongside a series of other measures targeting releases from the sector, expands on requirements the agency first imposed in its 2012 NSPS that only targeted emissions of volatile organic compounds (VOCs) but has a co-benefit of also reducing methane.
The proposal does this by requiring sources subject to the 2012 rule to control methane releases for the first time, while also subjecting some sources not regulated by the earlier rule, such as hydraulically fractured oil wells and downstream compressors and other equipment, to first-time controls for both VOCs and methane.
EPA says in the proposal, which it will take comment for 60 days after publication in the Federal Register, that the proposed methane requirements are necessary because the oil and gas industry is currently one of the country's “largest emitters of methane,” citing its 2009 finding that greenhouse gases, which include methane, endanger public health and welfare.
EPA says the proposed rule, issued under section 111(b) of the Clean Air Act, will cut an estimated 340,000 to 400,000 short tons of methane in 2025, equivalent to reducing 7.7 to 9 million metric tons of carbon dioxide (CO2) as methane is a much more potent greenhouse gas than CO2. Additionally, EPA says the proposed rule could also reduce up to 180,000 tons of ozone-forming VOCs and up to 2,500 tons of air toxics by 2025.
While the agency is directly regulating methane for the first time, the agency is rejecting environmentalists' calls to regulate methane from existing sources under section 111(d), just as the agency did with its recent GHG rules for the power sector.
During an Aug. 18 press call, EPA's acting air chief Janet McCabe declined to say whether the agency would pursue an existing source standard, saying that “we're not ruling anything out,” but that for now EPA will focus on the proposed rule.
“We're really focusing on this proposal for today and the conversations we expect to have on this proposal,” McCabe said, calling the proposed rule an “important step to get us significantly along the way” to reducing methane emissions from the sector by 40-45 percent, the goal that President Obama set as part of his broader methane strategy.
McCabe emphasized that other federal agencies are looking at a “variety of other options” for curbing methane from the sector, referring to steps that the Interior Department is taking to reduce flaring of natural gas at production sites, though that proposed rule has not yet been issued.
She also referenced EPA's recently proposed voluntary methane challenge program and co-benefits from the just-issued draft control techniques guidelines for reducing VOC emissions from existing oil and gas sources, which regulate VOCs from existing sources in areas out of attainment with EPA's ambient air standards for ozone and the 11 Northeastern states within the ozone transport region. The guidelines are intended to assist states in setting reasonably available control technology for sources of VOCs from the sector.
Broad Range Of Sources
After environmentalists failed to convince the administration to regulate methane from existing sources, they shifted their advocacy to instead urge the administration to ensure that the NSPS captures a broad range of sources, an approach they hope would preserve their options for eventually regulating a similarly broad range of existing sources.
The proposed rule appears to go some way toward that goal though it is not clear whether environmentalists are satisfied with what the agency is proposing.
For example, EPA's 2012 NSPS rules for the oil and gas sector set VOC controls for a number of sources, including fracked natural gas wells, but sources say it was largely focused on production sources.
The new proposal would extend the VOC requirements to many downstream sources, such as pneumatic controllers and compressors located downstream of the well site, as well as sources excluded from the earlier rules such as oil wells, pneumatic pumps and leaks from well sites and compressor stations.
In addition to the VOC controls, the proposed rule would include first-time methane reduction requirements for those sources as well as gas wells, leaks at processing plants and other equipment covered under the 2012 VOC rules.
But some sources that EPA considered for regulation are not subject to the proposed NSPS, suggesting EPA could face lobbying from environmentalists to regulate them in the final NSPS.
For example, EPA declined to propose methane requirements for liquids unloading, a key production process of flushing excess liquids from wells, even though it was one of five source categories that the agency considered regulating.
The agency says in the proposal that “at this time the EPA does not have sufficient information to propose a standard for liquids unloading,” but is taking comment on “nationally applicable technologies and techniques that reduce methane and VOC emissions from these events.”
But in an apparent effort to limit the rule's costs, EPA is in some cases allowing industry to use technologies already required by the 2012 rules. For example, the 2012 requirements that reduced emission completions, known as green completions, be used at gas wells to capture excess VOCs would under the proposal be extended to include oil wells that are fracked.
“Accordingly, the current VOC standards also reflect the [best system of emission reduction (BSER)] for methane reduction for the same emission sources,” EPA says in the proposed rule.
Widespread Criticism
Despite the agency's attempt to give each side some of what they want, the proposed rule is drawing widespread criticisms.
Environmentalists, for example, welcomed the rules but suggested the NSPS does not go far enough because it does not address existing sources.
“More comprehensive rules for existing oil and gas infrastructure nationwide will be necessary to meet the White House’s goal of cutting methane pollution from the oil and gas industry 40-45 percent by 2025,” Natural Resources Defense Council senior attorney Meleah Geertsma said in an Aug. 18 statement on the proposal.
And industry groups and their supporters in Congress said the rules are not necessary. “We do not think EPA should be regulating methane,” Howard Feldman, senior director of regulatory and scientific affairs at the American Petroleum Institute, said during an Aug. 18 call with reporters.
Calling the new proposal “duplicative” of steps the industry has voluntarily taken, Feldman noted that API favored rules, like EPA's 2012 rule, that target VOCs.
Republican lawmakers are also criticizing the rulemaking and promising to closely scrutinize it. Senate environment committee Chairman James Inhofe (R-OK) vowed rigorous oversight on the proposal, saying the rulemaking is “unnecessary” and “punitive,” and that he plans to “follow up on previous oversight letters and hearings where industry leaders from Oklahoma and across the nation have testified on EPA’s misuse of methane data and their ongoing efforts to attack a thriving, critical domestic industry.”
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Methane Caps on Drillers Worked in Colorado
Aug 19, 2015 | BNA Daily Environment Report
By Christine Buurma
For an idea of how the U.S. government's proposed methane rules will affect drillers, look no further than Colorado.
The state became a test case for similar controls last year when a coalition of energy companies and environmental groups agreed on measures to cut the pollution. In a bid to address smog, regulators there adopted the nation's first rules requiring the oil and natural gas industry to find and fix methane leaks.
Drillers who were already voluntarily curbing emissions accepted Colorado's rules with little opposition. Gas production in May was up 1.5 percent from the same period two years earlier, Energy Information Administration data show. A state analysis estimated that the cost of the rules amounted to 0.4 percent of drillers' annual revenues.
“Methane is a product we sell, so it's in our business interest as well as in our general interest as environmental stewards to make sure every molecule goes into the sales line,” John Christiansen, a spokesman for Anadarko Petroleum Corp., said Aug. 18.
Colorado's measures are more stringent than those proposed Aug. 18 by the U.S. Environmental Protection Agency, which would require producers to upgrade pumps and compressors on new wells and expand the use of methane-capturing equipment for gas and oil wells (see related story).
The EPA proposal is part of an initiative to reduce leaks of methane, a more potent greenhouse gas than carbon dioxide, 40 percent to 45 percent from 2012 levels by 2025. While the federal mandates would apply to new wells, Colorado's regulations cover existing sources (37 DEN A-5, 2/25/14).
Infrared Cameras
“Colorado is ahead of the pack because it already has rules for reducing methane and other air pollutants from across the oil and gas value chain, including production and processing,” said Cheryl Wilson, an analyst with Bloomberg Intelligence in Washington.
Noble Energy Inc., Colorado's second-largest oil driller, said last year that the state's methane regulations would cost the company $3 million annually. That compares to its $1.8 billion capital budget this year for Colorado's Denver-Julesburg Basin and the Marcellus shale in the eastern U.S.
Anadarko and other producers are using infrared cameras to detect methane releases and have upgraded pneumatic valves.
‘Zero Complaints.’
“Since the implementation, we've heard zero complaints about the cost and practicality,” Dan Grossman, Rocky Mountain regional director for the Environmental Defense Fund in Boulder, Colo., said by phone Aug. 18. There has been no court challenge to the mandates, Grossman said.
Industry trade group the American Petroleum Institute, meanwhile, has described the EPA proposal as duplicative and costly, warning that it will “undermine America's competitiveness.” The EPA estimates methane accounted for about 10 percent of total U.S. greenhouse gas emissions in 2012, with the oil and gas industry responsible for almost a third of the emissions.
U.S. methane emissions have fallen 38 percent since 2005, U.S. gas producers say, citing EPA data. Over the same period, production is up 35 percent.
Without new restrictions, emissions are set to rebound in coming years, according to the agency. The EPA plans to finalize the rules in 2016.
“We're talking about a product, methane, that these operators sell to offset the cost of the regulations,” Grossman said. “That helps to ease the burden for them.”
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Liberal Senators Seek SEC Review Of Risk Disclosure
Aug 18, 2015 | E&E News PM
By Phil Taylor
Oil and gas companies have done a poor job disclosing to investors the risks associated with offshore drilling, a dozen liberal senators wrote in a letter today to the Securities and Exchange Commission.
The SEC should "conduct a full review of the disclosures of companies" drilling in the Gulf of Mexico or planning to explore frontier areas including the Atlantic and Arctic oceans "to protect investors and maintain the integrity of the market," said the letter spearheaded by Sen. Ben Cardin (D-Md.).
The other signatories, all of whom oppose offshore drilling, are: Democratic Sens. Sheldon Whitehouse of Rhode Island, Dick Durbin of Illinois, Jeff Merkley of Oregon, Elizabeth Warren of Massachusetts, Barbara Boxer of California, Bob Menendez and Cory Booker of New Jersey, Patrick Leahy of Vermont, Richard Blumenthal of Connecticut and Brian Schatz of Hawaii, and independent Sen. Bernie Sanders of Vermont.
The letter comes one day after the Interior Department announced approval of Royal Dutch Shell PLC to drill for oil in the Arctic Ocean, an area that environmentalists have warned poses unique safety risks due to its remote location and adverse weather.
The senators warned that Shell "did not disclose risks inherent to its Arctic Ocean exploration program." A spill there "would devastate sensitive ocean ecosystems and coastal communities and would likely cost Shell billions of dollars in repair and clean-up costs."
Their letter notes the $18.7 billion BP PLC has tentatively agreed to pay the government to settle the damage it caused in its massive 2010 Gulf oil spill.
They claimed Shell has provided the government "boilerplate generalities" about the potential for an incident and has not disclosed that its response plans have not been tested in the Arctic.
A Shell spokesman said the agency has not led investors astray.
"We remain satisfied with our 20-f disclosure as it complies with all SEC legal requirements," said spokesman Curtis Smith. "It's also our view that a very unlikely spill in the Arctic would not be financially material to the company given the precautions we have taken to prevent and respond to a worst-case scenario."
Randall Luthi, president of the National Ocean Industries Association, called the senators' letter "another example of an effort to end the use of fossil fuels."
"This is not a new business, and the risks, although quite minimal, are well-known," he said.
The Obama administration has faced increased scrutiny as a result of approving Shell's Arctic plans. Three top House Democrats in July sent a similar letter asking the SEC to increase its oversight of companies that drill offshore, while others who oppose Arctic drilling say it poses a long-term threat to the climate.
Democratic White House hopeful Hillary Clinton today slammed the administration, saying on Twitter that Arctic drilling is "not worth the risk" (Greenwire, Aug. 18).
Industry officials and Alaska lawmakers have defended Arctic exploration, arguing that Shell has adopted a suite of voluntary safety measures and that other countries will continue exploring the Arctic Ocean with or without the United States' participation. Sen. Lisa Murkowski (R-Alaska) yesterday said Arctic oil estimated in the tens of billions of barrels could help replenish the Trans-Alaska pipeline system.
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EPA Floats New Aggregation Approach For Oil & Gas Sector Air Permits
Aug 18, 2015 | InsideEPA
By Bridget DiCosmo
EPA is proposing a complex new system for determining when emissions from oil and gas sources should be “aggregated” or combined in air permitting decisions, an effort that appears aimed at ending years of litigation and policy uncertainty over when disparate sources are subject to strict “major” source permit requirements.
The agency Aug. 18 released its proposed source determination rule, which includes two options for when sources are “adjacent” and therefore considered as a single source -- a controversial “functional interrelatedness” factor that would lead to more aggregation than current policy and a more conservative “physical proximity” test that the agency says is its preferred option.
The agency issued the proposal alongside a package of other air regulatory measures for the oil and gas industry, which includes first-time methane standards for a number of sources, control techniques guidelines for volatile organic compounds sources in areas out of attainment with EPA's ozone standards, and a federal implementation plan for new minor sources on tribal lands.
The proposed source determination rule is the result of a spate of litigation over EPA's Clean Air Act policy on “aggregating,” or combining, emissions for permitting purposes. Aggregation is a major issue for industry, especially the natural gas sector, because if combined emissions from several sources exceed a certain threshold, they could be subject to stricter permit controls as “major sources.”
EPA says the proposal would clarify how properties in the oil and gas sector are determined to be adjacent in order to assist permitting authorities and permit applicants in making consistent source determinations in the prevention of significant deterioration and new source review programs.
The proposal would retain the three main factors the agency has long used in determining whether to aggregate: whether facilities are under common control, whether they are part of the same industrial grouping, and whether they are contiguous or adjacent.
The agency is proposing two options for how to determine adjacency for two or more properties in accordance with this three-prong test. The first option, which EPA says is its “preferred option,” would define “adjacent” in terms of proximity, or sources separated by a distance of one quarter mile or less.
“The EPA is co-proposing and taking comment on an alternative option to define “adjacent” in terms of proximity or functional interrelatedness,” the proposed rule says.
EPA is proposing to define “source” as those that are under common control, share the same industrial grouping, and are “adjacent” by either proximity or if it is “exclusively functionally interrelated.” The agency says, “Exclusive functional interrelatedness might be shown by connection via a pipeline or other means, because of the physical connection between the equipment.” For example, EPA says, exclusive delivery of product from one group of equipment to the other via truck or train and facts such as whether one group of equipment would be able to operate if the other group of equipment was not operating.
“The EPA and states would make a determination of adjacency based on a consideration of the interrelatedness of emitting activities in addition to the distance between them,” the proposed rule says. Therefore, sources would be considered adjacent if they are separated by a distance of one quarter mile or more and there is an exclusive functional interrelatedness; or if they are separated by distance of one quarter mile or less.
Aggregation Litigation
Development of the rule is being driven by a ruling from the U.S. Court of Appeals for the 6th Circuit, which ruled in 2012 in Summit Petroleum Corp. v. EPA to scrap the agency's “functional interrelatedness” test for determining “adjacency.”
EPA had used the functional interrelationship test as part of its aggregation method detailed in a 2009 memo from then-agency air chief Gina McCarthy to determine whether to combine emissions from dispersed oil and gas operations for permitting purposes. The memo said EPA assesses whether facilities are contiguous or adjacent; whether they are in common control; and whether they are part of the same industrial grouping.
McCarthy’s memo revoked an earlier Bush-era memo by then-acting air chief William Wehrum stressing that proximity was the most important factor to determining adjacency, and the 6th Circuit's ruling in Summitessentially revived the Wehrum memo's focus on proximity in states covered by the court.
The Summit court rejected EPA's efforts to use informal policy memo to codify the functional interrelatedness test, saying that unless the test was codified in EPA regulations, adjacency must be determined based solely on physical proximity, which is less likely to trigger aggregation.
Industry groups in recent meetings on the aggregation policy with EPA and White House officials urged that the agency avoid expanding the determination beyond physical proximity, one industry source says. “They should stick to a clear test: same two-digit major [industrial] code, common control, and contiguous or adjacent based on physical proximity,” that source says.
Following the ruling, EPA issued a December 2012 memo that sought to limit the ruling to those states covered by the 6th Circuit: Michigan, Ohio, Tennessee and Kentucky, which cover parts of EPA Regions 4 and 5. The memo said that in all other EPA regions and states the stricter adjacency test would remain in place.
But industry sued over the memo in the D.C. Circuit, and the court in a May 2014 ruling sided with industry, finding the memo is a final agency action because it creates a new enforcement regime that unfairly advantages permitted facilities in the 6th Circuit.
The court said that EPA had other options it could have pursued, including developing a rulemaking to clarify or revise its aggregation requirements, which the agency issued in an Aug. 5 proposal.
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Oil Company-Funded Campaign Targets Activist Steyer
Aug 19, 2015 | BNA Daily Environment Report
By James Nash
Oil companies that bankrolled a $9.7 million effort in 2014 to block laws against hydraulic fracturing in California now are focusing their sights on Tom Steyer, the billionaire hedge-fund founder turned climate-change activist.
The top individual political donor in the U.S. last year, Steyer has put millions of his $2.7 billion personal fortune into the cause, hired the former top spokesman for California Gov. Jerry Brown (D) and challenged Chevron Corp. Chief Executive Officer John Watson to a public debate on gas prices.
In its campaign against him, Californians for Energy Independence—whose contributors include Chevron, Exxon Mobil Corp. and Occidental Petroleum Corp.—has been probing what it says are possible conflicts between Steyer's business interests and legislative advocacy. The group has issued statements attacking Steyer as a “billionaire super-PAC king” and shadowed his public appearances.
“This is part and parcel of the way politics works right now,” said Bob Biersack, senior fellow at the Center for Responsive Politics in Washington, which documents the influence of money in politics. “You have a small number of people who are making their presence felt in a huge way, and they become fair game.”
Steyer is part of this small but growing cadre of mega-donors whose influence has grown since the U.S. Supreme Court ruling in the 2010 Citizens United case lifted limits on independent campaign spending. Now, noncandidates including Steyer, the Koch brothers and George Soros are subjects of attacks, much like politicians.
Unflattering Films
Conservatives David and Charles Koch have been the focus of at least three unflattering films and aKochWatch.org website with the tagline “Billionaires Corrupting Democracy.” The liberal Soros was featured in an hour-long Fox News television program, “The Puppet Master,” with conservative host Glenn Beck.
Steyer—who founded and ran Farallon Capital Management LLC for almost 27 years before leaving at the end of 2012 to focus on climate issues—backs a bill in the California Senate that would cut petroleum use in half, double the energy efficiency of buildings and increase retail sales of renewable electricity to 50 percent by 2030.
He worked on the bill with Kevin de Leon, its author and the Senate president pro tem, and has lobbied for the legislation. He also criticized oil refiners about California gas prices at a news conference with Jamie Court, president of the Santa Monica, Calif.-based Consumer Watchdog advocacy group.
Media Outreach
In July, Steyer hired Gil Duran, a former top spokesman for Brown, as a spokesman on California issues. Duran minimized his role, saying in an interview that Steyer had effective media-outreach aides already.
In a letter he made public earlier in August, Steyer challenged Chevron's Watson to an open debate on why gas prices in California have risen more than in other states. Chevron spokesman Braden Reddall didn't say how Watson responded to the challenge but noted in an e-mail that the company already engages in discussions about gas prices with politicians, regulators and the media.
NextGen Climate Action, Steyer's political action committee, has spent $729,000 on lobbying the California government so far this year, compared with about $100,000 in the prior legislative session, according to data from the Office of the Secretary of State. Oil and gas interests, led by the Western States Petroleum Association trade group and Chevron, have spent $6.8 million on efforts that include lobbying against the bill Steyer supports.
Energy-Efficient Retrofits
Californians for Energy Independence says it has evidence that one of Steyer's businesses, Kilowatt Financial, could make more money if the bill is passed. Steyer was listed as a manager of the limited-liability company in an April 2014 filing with the secretary of state. Kilowatt makes consumer loans for energy-efficient home renovations and is merging with another lender.
Sabrina Lockhart, spokeswoman for the energy-independence group, said Kilowatt stands to gain from the legislation because the bill mandates the renovations.
“He's trying to shape policies and he's trying to benefit financially,” she said.
Steyer's spokeswoman, Suzanne Henkels, said he stepped down from Kilowatt last year and directed all his green-energy investments into a charitable trust, meaning he won't profit from the company's operations.
Keystone Critic
Steyer also was criticized for his opposition to the Keystone XL oil pipeline between Alberta, Canada, and Nebraska. The national Republican Party denounced him in a Web posting for opposing the pipeline after Farallon profited from oil and gas investments and invested in a company proposing a rival pipeline. Steyer has vowed to back Democratic lawmakers who face attacks for voting against it.
Lockhart said Steyer “takes up a good chunk of my time.” She was in the room on June 12 when Steyer called on leaders of the $191.5 billion California State Teachers' Retirement System to consider divesting from fossil-fuel stocks (115 DEN A-18, 6/16/15).
On Aug. 11, Lockhart sent reporters an e-mail calling Steyer a “billionaire super-PAC king” and asserting his criticism of higher gas prices is out of sync with his goal of weaning drivers off gasoline.
Her e-mail also referred to a July 2014 Washington Times report on Steyer's alleged use of tax havens in the Cayman Islands, the British Virgin Islands and Mauritius while heading Farallon. Steyer declined to comment to the Washington Times, and Duran and Henkels didn't respond to an e-mailed request for comment from Bloomberg News.
‘Dirty Him Up.’
“They are going to try to dirty him up,” said Court, a Steyer ally. “He is personally committed on a moral level to preventing a 4-degree temperature change that is irreversible, and he has $3 billion to pursue his passion.”
Last year, Steyer's NextGen super-PAC tried to influence elections in several states by appealing to voters concerned about climate change. In Florida, it dispatched more than 500 staff members and volunteers to criticize Gov. Rick Scott's (R) energy policies and used a “Noah's ark” to show the threat of rising ocean levels. Scott still won re-election.
Steyer gave $75.4 million to federal candidates and causes in 2014, according to the Center for Responsive Politics, almost triple the contributions of the next-highest individual donor, Michael R. Bloomberg, majority owner of Bloomberg BNA parent company Bloomberg L.P.
Inequality, Environment
On Aug. 12, Steyer announced he will broaden his policy agenda to include “income inequality and middle-class opportunity.” In an interview at the event in Oakland, Calif., where he unveiled the “Fair Shake Commission,” he said issues related to inequality are linked to his environmental activism.
Lockhart, of Californians for Energy Independence, said Steyer “didn't become a hedge-fund billionaire without getting a significant return on his investment,” and he could “take the same path in politics.”
Steyer has denied his efforts are intended to position himself for political office, even while refusing to rule out a bid. He considered running for the U.S. Senate before bowing out in January.
For now, he says the opposition won't deter him and he is focusing on his climate initiatives by giving speeches and meeting with editorial boards and policy makers in Iowa, participating in a panel on clean energy with business leaders and environmentalists in New Hampshire and joining a public clean-energy discussion in Ohio.
“I'm choosing to take it as a compliment that they're taking us as a threat,” he said. “They're making too much money if they're going to waste it on stuff like that.”
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Greens Question EPA's Estimates On Methane Reduction Goals
Aug 18, 2015 | E&E News PM
By Jean Chemnick
While U.S. EPA's new proposal for oil and gas methane encountered the expected cheers and jeers from fans and foes of environmental regulations today, greens found themselves grappling with a statement from EPA air chief Janet McCabe that seemed to suggest the agency was a lot closer to its methane reduction goals than they believed it was.
Numerous reporters asked McCabe on a midday call how close today's proposal for methane and volatile organic compounds would take the agency toward meeting the Obama administration's pledge to cut oil and gas emissions of the powerful greenhouse gas between 40 and 45 percent below 2005 levels by 2025. McCabe put the number at between 20 and 30 percent, but made it clear that that estimate included a 2012 rule requiring hydraulically fractured natural gas wells to use green completion technology to limit emissions -- a move that cut methane by between 900,000 and 1.6 million tons compared with today's proposal, which would avoid only 340,000 to 400,000 tons by 2025.
Put those rules together with existing rules for oil and gas operations in ozone non-attainment areas, and EPA appears to have significantly closed in on the 40-to-45 percent goal, cutting the petroleum sector's methane by as much as 25 percent compared with before there were regulations in 2012. That would leave the U.S. petroleum sector only 15 to 20 percent left to cut between now and 2025.
Greens were still assessing what those figures meant this afternoon, but they expressed some discomfort about them. They have argued that the administration's pledge would make mandatory curbs for existing oil and gas operations an absolute necessity, and McCabe's figures appeared to them to be changing the baseline.
Clean Air Task Force advocacy director Conrad Schneider said the figure was "apples to oranges" when compared with the 40-to-45 percent pledge, while Mark Brownstein of the Environmental Defense Fund said, "I'm not sure how their math adds up."
"Our own view is that this probably gets us closer to a 5 percent reduction," he said of today's set of proposals. While today's rule would prevent the sector's emissions from climbing, as they are projected to do, it would do little to limit today's emissions, he said.
"A rule that is primarily focused on new and modified sources by definition is going to have marginal impact on facilities that are in service today," Brownstein said. "And that is the nub of the challenge."
Apart from the questions over accounting, EPA's proposed mandate elicited the expected responses from Capitol Hill, as Democrats lauded the administration's latest high-profile climate play and Republicans slammed a new front in the offensive against fossil fuels.
Sen. Sheldon Whitehouse (D-R.I.) called the rule a "sensible, cost-effective step" to control both a powerful greenhouse gas and emissions that contribute to ozone.
"As we replace coal with natural gas, it's important to reduce methane leakage," said Whitehouse, who leads the Bicameral Task Force on Climate Change. "Industry has been dragging its feet in implementing solutions, so EPA is stepping in with sensible requirements."
Sen. Ed Markey (D-Mass.) touted his own legislation with Whitehouse and Sen. Brian Schatz (D-Hawaii) that would provide the industry with incentives to replace and repair old infrastructure that is most prone to leakage.
The administration's new reduction goals "add to the comprehensive approach President Obama is taking to tackle the issue of global warming and position the United States as the world leader on climate action," Markey said.
But Sen. James Inhofe (R-Okla.) decried the new rule as "not only unnecessary, but another example of the administration's punitive expansion of their war on fossil fuels."
"The oil and gas industry has proven success in reducing methane emissions on their own, even while increasing production levels significantly," said the Senate Environment and Public Works Committee chairman. "The minuscule fraction of greenhouse gas emissions made up by methane emissions from oil and gas production makes this yet another regulation from the Obama administration that will have no tangible impact on reducing greenhouse gas emissions."
Inhofe pledged he would use his gavel to conduct "rigorous oversight" of the draft rule, beginning with a hearing this fall when Congress returns from its August recess.
The petroleum industry says that far from shirking its responsibility to limit emissions, it has actually made substantial voluntary progress on that score in recent years.
The industry's trade associations note that EPA's own inventory data show that methane emissions from natural gas production have actually declined 38 percent since 2005, a period when production has increased 35 percent. Gas wellheads are the sector's largest single source of methane.
"Natural gas producers will continue reducing methane emissions regardless of this proposal," Marty Durbin, president of America's Natural Gas Alliance, said in a statement. "Not only do we have an incentive to capture methane -- it is the product we sell -- but our track record of efficiency improvement and innovation are what drives the environmental, economic and energy security benefits of natural gas."
He urged that EPA take a "collaborative approach" that did not include new regulations.
But environmentalists say that the downturn in leakage that natural gas production has demonstrated in the last couple of years is largely due to a phase-in of EPA green completion requirements that have applied to gas wellheads, which today's draft would expand to include many oil wellheads. They also note emissions are on the rise for other segments of the industry, which as a whole is leaking 7 million metric tons of the powerful greenhouse gas into the atmosphere each year and threatens to increase by 25 percent compared with 2012 levels by 2025, according to EPA estimates released early this year.
Today's proposal would cover emissions from compressors, leaks and pneumatics. Environmentalists are expected to comment that EPA should also control methane from liquids unloading in its final rule. CATF's Schneider said EPA seemed to have decided it lacked the data to move ahead with controls on liquids unloading but hoped that would not be the case when the rule is final next year. Building a plunger lift into a new well is a fairly cost-effective way to keep gas from escaping when liquids are released from wellheads, he said.
Schneider said the industry's protestations that it had already cut some emissions were beside the point.
"As a globe, if we're going to control global warming, we're going to have to get emissions from this country down by 80 percent," he said, mentioning the Obama administration's midcentury target. "All emissions are going to have to come down substantially in order to make a dent."
The cost to take the reductions EPA would mandate in today's draft is less than what the agency estimates utilities will pay to make equivalent reductions under the Clean Power Plan, Schneider noted.
"This is the lowest-hanging fruit on the tree, and we have to pick all of it," he added.
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N.C. Agency to File Lawsuit Over Clean Power Plan
Aug 19, 2015 | BNA Daily Environment Report
By Jeff Day
The North Carolina Department of Environment and Natural Resources will join other states in seeking to block implementation of the federal Clean Power Plan to control carbon dioxide emissions, according to an agency spokeswoman.
DENR spokeswoman Crystal Flagmen told Bloomberg BNA Aug. 18 that the agency will file a lawsuit similar to those promised by 15 other states against the regulation. Those states and one more have asked the Environmental Protection Agency to administratively stay the rule, pending the results of litigation (151 DEN A-5, 8/6/15).
North Carolina Attorney General Roy Cooper (D) earlier declined to file suit against the regulation and suggested Aug. 7 that state officials instead should discuss the best way to deal with the power plant regulation.
The DENR said in an Aug. 17 news release that the Clean Power Plan would cost North Carolina consumers and businesses an estimated $41 billion per year.
Gov. Pat McCrory (R) said after the final Clean Power Plan was released Aug. 3 that his administration planned a legal challenge to the carbon dioxide rules. The requirements would raise electricity rates and “have the potential to jeopardize the success we've made in making North Carolina's air the cleanest it's been since we began tracking air quality back in the 1970s,” McCrory said.
The North Carolina Senate on Aug. 6 approved legislation (H.B. 571), now pending in the House, that would direct the DENR to challenge the EPA's regulation (152 DEN A-9, 8/7/15).
Attorney General Opposes Lawsuit
The DENR's Aug. 17 announcement came after Cooper sent a letter Aug. 7 to House and Senate leaders questioning the bill's directive to the DENR.
“Although this legislation poses constitutional questions, I am even more concerned that this action will risk North Carolina's well-deserved reputation for protecting the quality of our air, recruiting businesses that produce cutting-edged technologies and offering leadership around the world on energy issues,” Cooper said.
“Piecemeal litigation like this can significantly harm our effort to implement our own clean power plan along with risking a federal takeover of North Carolina energy policy that we could otherwise avoid,” Cooper said.
“North Carolina's Clean Smokestacks Act, our renewable energy standard and other forward-thinking efforts were forged by collaboration among interested parties such as utilities, environmentalists, businesses and consumer advocates. Our state is in a great position to bring these and other stakeholders together once again to work with the EPA to devise our own plan to protect North Carolina's air and promote economic growth,” Cooper wrote.
DENR Secretary Opposes Power Plan
“We do not share Cooper's belief that the federal EPA is the best guardian of North Carolina's economic and environmental interests,” DENR Secretary Donald R. van der Vaart said in a Aug. 17 blog post.
“North Carolina has already reduced greenhouse gas emissions by 20 percent since 2005 without the Clean Power Plan, and it is on track to meet the president's goal of a 30 percent reduction by 2030 without intervention from the federal government,” van der Vaart said.
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Report: California Cap-And-Trade Bills Seek Billions More Than Available
Aug 18, 2015 | The Sacramento Bee
By Jeremy B. White
California lawmakers have proposed spending billions more in cap-and-trade money than is likely to be available, according to a report compiled by an advocacy organization critical of the climate program.
Under the state’s system for curbing greenhouse gases, businesses must buy emissions credits. Revenue from those auctions flow into a state fund that can be used for projects that further reduce carbon emissions. A previous budget deal dedicated much of the money to affordable housing, transit and the high-speed rail project.
Gov. Jerry Brown and legislators have not yet agreed on how to spend what Senate budget officials estimate to be over $2.7 billion available this year, having agreed during budget talks to divide up the cap-and-trade fund later.
Legislators weighed in early and often this year with bills dictating where the growing fund could be spent. According to an analysis by the California Taxpayers Association, legislators have floated 23 bills that would allocate a total of $4.8 billion.
It’s not just an academic exercise for the California Taxpayers Association, which opposes some of the bills – including measures to spend money on river cleanup projects or on renewable energy for low-income homes – as improper uses of the cap-and-trade money. The group filed an amicus brief in support of a lawsuit challenging cap-and-trade’s constitutionality.
In a world of finite revenue, Sacramento policymakers regularly have to pare back spending proposals. In deciding this May which bills would advance from and which were too costly to move on, the Assembly Appropriations Committee considered $17.4 billion worth of proposals and let out a package costing a total of $435 million.
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The Limits Of Obama’s New Rules On Pollution
Aug 18, 2015 | The Washington Post
The Obama administration released new pollution rules on oil and natural gas production Tuesday to predictable howls from industry. The danger, though, is that the rules won’t do enough to achieve the United States’ climate goals.
The fracking boom has opened vast deposits of American oil and natural gas for extraction, and that’s been a good thing. The industry has created jobs and cut fuel imports. Natural gas, now cheap, has substituted for dirty coal in electricity production. When burned, natural gas produces significantly fewer greenhouse emissions than coal. Fuel switching has therefore helped the country advance toward its climate change targets.
But there’s a major problem: Methane, the primary constituent in natural gas, is an extremely potent greenhouse agent when it escapes from wells or pipelines without being burned. Even relatively small amounts of leakage can wipe away the climate benefits of switching to natural gas. That’s why President Obama set a goal of reducing methane leakage by 40 percent to 45 percent by 2025.
The Environmental Protection Agency took a step toward that goal on Tuesday. The agency rolled out rules requiring the oil and gas industry to take more care not to leak methane from new or significantly altered wells, compressors, pneumatic pumps and other potential sources. Environmental groups have long argued that these sorts of upgrades are among the cheapest ways to cut greenhouse emissions. The EPA, meanwhile, points out that the rules should also prevent unhealthful air pollution around oil and gas facilities.
The industry counters that companies have already cut methane leakage even as oil and gas production have shot up, pointing out it has an economic incentive to keep its product from leaking. That’s true, up to a point, but these companies don’t have to account for the climate impacts of that leakage so their incentive may be less than what society’s interests would dictate. Until the country has an effective price on carbon that would force companies to account for their greenhouse impact, this line of argument will not be convincing.
Also released Tuesday was a report underscoring the need to act on methane emissions, and soon. The study, published in the journal Environmental Science & Technology, found that previous EPA estimates of leakage rates from natural gas collection and processing facilities were far too low. It is findings such as these that have convinced environmental groups that the Obama administration must set comprehensive rules that would be much more ambitious than those announced Tuesday, covering existing infrastructure, not just new or significantly rebuilt facilities. If, after serious study, the EPA is confident that the government will reach its methane goal without a broader crackdown, so much the better. But federal and state regulators shouldn’t hesitate to go further if that promise won’t be realized.
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Carson Slams EPA Over Colorado Mine Spill
Aug 18, 2015 | The Hill - E2 Wire
By Devin Henry
Republican presidential candidate Ben Carson slammed the Environmental Protection Agency (EPA) on Tuesday for its handling of a toxic spill into Colorado’s Animas River this month.
“The citizens, businesses and peoples relying on the vitality of the Animas River deserve complete, transparent and expeditious accountability on this matter from the EPA,” Carson said in Durango, Colo. He said the EPA should pay for clean-up costs the same way it would levy fines against private-sector polluters.
“I suggest that these reparations be paid from fines collected by EPA, and not by additional tax dollars from the general fund,” he said. “The EPA must face the same consequences and same accountability as they require of each of us.”
A team of EPA contractors inadvertently spilled 3 million gallons of toxic sludge into the Animas River earlier this month while inspecting an abandoned gold mine.
Carson toured the river by helicopter on Tuesday and later told supporters that the agency should not get a free pass for the spill.
“One wonders, if this accident had occurred at the hands of a private business, or even an individual property owner, would the EPA be as forgiving as they have been of themselves?” he said. “I think not.”
Carson proposed a “new missions statement” for the EPA, including a focus on not harming the environment, issuing “objective” fines and penalties for polluters, and working with businesses and industries to write environmental regulations.
“We all want a better environment,” he said. “We all want to protect the environment for generations to come. We all want more common sense in the administration of our environmental laws and policies.”
Since the EPA’s Aug. 5 spill, officials have worked to track water quality in the region, which has returned to pre-spill conditions. The agency ceased all future mine inspections until the cause of the spill is identified.
Administrator Gina McCarthy visited the site last week, apologized for the accident and called for internal and external investigations into it. The EPA’s inspector general announced Monday that it had kicked off an inquiry.
The spill has drawn the ire of Republicans both at the Capitol and on the campaign trail.
Sen. Marco Rubio (R-Fla.), another presidential candidate, said last week that the spill illustrates the EPA’s “incompetence.” Front-runner Donald Trump said the incident proves the EPA should hand its duties over to state, not federal, regulators.
Lawmakers have promised to hold hearings on the matter when Congress returns this fall.
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EPA Sees Input On 'Interpretive' Rules As 'Case-By-Case' Policy Decision
Aug 18, 2015 | InsideEPA
By Bridget DiCosmo
EPA says that its decisions on whether to seek public notice and comment on “interpretive” rules that state its interpretation of the text of an existing regulation are done on a “case-by-case” basis, after some observers suggested a recent Clean Water Act (CWA) rule hinted at EPA seeing limits on its power to waive public input.
In an Aug. 7 proposed interpretive rule, the agency said it aims to streamline the process for tribes to apply for CWA approval to set enforceable water quality standards (WQS). EPA is taking public comment through Oct. 6 on its proposed interpretation of section 518 of the CWA as establishing a congressional intent for EPA to delegate CWA authority to eligible tribes -- even though the high court has said such input might not be necessary.
Under the Administrative Procedure Act (APA), agencies must follow notice-and-comment procedures for major rulemakings but whether that applies to interpretive rules has been the subject of debate.
Until earlier this year the U.S. Court of Appeals for the District of Columbia Circuit, which hears challenges to most major EPA rules, had required agencies to follow notice-and-comment procedures when revising an interpretive rule, as long as the existing interpretation had been "substantively relied on" in other proceedings.
But the Supreme Court in a 9-0 decision, issued March 9, Perez, et al., v. Mortgage Bankers Association, et al.,overturned the D.C. Circuit's doctrine. Writing for the high court, Justice Sonia Sotomayor said the D.C. Circuit's doctrine "is contrary to the clear text of the APA's rulemaking provisions, and it improperly imposes on agencies an obligation beyond the 'maximum procedural requirements' specified in the APA."
Observers say the high court ruling should have given EPA leeway to issue the tribal WQS rule without seeking notice and comment. But the agency's decision to seek input on the proposal before crafting a later final version of the rule suggests EPA might take a more conservative approach on such rules, sources say.
When Inside EPA first reported the observers' view of the WQS rulemaking earlier this month, the agency did not respond to a request for comment by press time. But an EPA spokesman subsequently responded to say that the agency's decisions on whether to seek input on interpretive rules are done separately for each rule.
“EPA has previously sought comment or conducted other outreach on a number of guidance documents and interpretations and continues to view this as case-by-case programmatic/policy choice. In this case, EPA had committed to states and tribes prior to the Supreme Court’s Mortgage Bankers decision that the public would have an opportunity to provide comments on this interpretation,” the spokesman says.
“Another reason EPA viewed notice and comment as appropriate in this case (notwithstanding the absence of a legal requirement) is that the original interpretation that EPA proposes to revise was itself announced as part of the preamble to a legislative rule that went through notice and comment, and thus it seems appropriate to mirror that process for the revised interpretation,” adds the spokesman.
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EPA Nominees Seen Hindered By Agency Slowing Responses To Congress
Aug 18, 2015 | InsideEPA
By David LaRoss
EPA's long-pending nominees to head top agency offices could face further delays in Senate consideration due to what some observers see as the agency slowing its responses to queries from Congress, as Republican senators have floated the possibility of blocking all nominations until EPA fully answers a host of outstanding queries.
Senate Environment & Public Works Committee (EPW) Chairman Sen. James Inhofe (R-OK) has warned the agency that its nominees could face indefinite "holds" preventing them from committee or Senate floor consideration unless the agency moves more quickly in response to questions and document requests on subjects including its power plant greenhouse gas (GHG) standards and Clean Water Act (CWA) jurisdiction rule.
Currently EPA has vacancies at five assistant administrator offices -- three of which have no formal acting official -- along with the deputy administrator position. Nominees are pending for all six positions.
But environmentalists suggest that EPA might be slowing down its replies and more reluctant to hand over confidential and privileged documents to congressional committees after House Republicans in July released a slew of "sensitive" Army Corps of Engineers memos from the development of the CWA rule.
The document release by the House Oversight & Government Reform Committee included several Corps memos written late in development of the final rule that expressed often-harsh criticism of the regulation itself and the agencies' scientific and economic analyses supporting it. The memos have been seen as a boost for the array of suits filed by states and industry that claim the rule is both substantively and procedurally flawed.
The Corps turned over its memos in response to a Congressional request for materials related to the CWA rule, which Republicans have strongly opposed as an overreach of EPA's authority.
Assistant Secretary of the Army for Civil Works Jo-Ellen Darcy asked legislators not to publicly distribute the letters, noting that they could be used in litigation over the rule and that Freedom of Information Act exempts "pre-decisional" materials from release, but the House panel posted the documents in full online.
By releasing the internal documents, one environmentalist suggests that House Republicans are "obviously doing it to help a particular side in litigation. . . . If I were in the administration I'd be angry, and this is clearly, to me, an indication that you don't give privileged communications to Congress."
'Normal Response'
EPA would be right to scale back handing over documents to lawmakers in replies to queries about agency policies, says the source. Such a position would be "a normal response. If you have documents that are privileged, and you give them to Congress because of its position of oversight, you risk exactly this."
A second environmentalist says that in light of the House oversight committee's decision, EPA and other agencies seem likely to slow its release of documents to Congress, assert executive privilege more often, or some combination of the two. "Generally speaking agencies do release documents to Congress, but sometimes they assert executive privilege, and you might see those assertions go up in the future," the observer says.
EPW has been pressuring EPA to respond to requests for documents on three recently finalized or pending rules, including for the legal justification underlying the recently published CWA rule -- which details the types of waterbodies EPA and the Corps consider "waters of the United States" subject to regulatory protections.
Second is a request for the legal argument supporting EPA's proposed endangerment finding for aircraft GHG emissions, which if finalized will trigger a duty for the agency to craft first-time aircraft GHG rules.
And a third outstanding request for documents centers on allegations that the agency's work with environmental and grass-roots organizations to push back against criticism of the CWA rule may have broken federal lobbying law. EPA has rejected any claims that its work on the regulation was unlawful.
If EPA or the White House does clamp down on responses to Congressional requests it seems certain to spur retaliation from the Republican majority on EPW, which oversees the agency and must approve all nominees for top agency positions before they go to the Senate floor for a vote.
EPA, the Corps and EPW all did not respond to requests for comment.
Potential 'Holds'
Inhofe did not explicitly promise to block EPA nominees in response to slow production of documents, but he said that it was "very appropriate" for Sen. Dan Sullivan (R-AK) to raise the idea at a June 11 EPW hearing.
Inhofe later questioned whether the committee has any other options beyond blocking nominees to compel a response from EPA Administrator Gina McCarthy the lingering questions the committee has posed both to her and to other agency officials.
"I can assure you that that's what I would do, and what he would do, and what the majority would do, if they don't respond. You have to respond to questions, and there is no other leverage," Inhofe said.
The Senate has already been slow to consider EPA nominees, even after the Democratic majority in the 113th Congress eliminated the filibuster for executive-branch positions.
Most prominently Ken Kopocis -- the agency's de facto top water official whose nomination to head the Office of Water was pending for almost three years -- never received a floor vote, even though then-Senate Majority Leader Harry Reid (D-NV) used his case as an example of the reason for scaling back filibusters.
Even though the White House continues to send some environmental nominees to the Senate, the first environmentalist says administration officials have indicated an assumption that "environmental nominees will never get confirmed" by the GOP Senate.
Some nominees, such as Kopocis and acting EPA air chief Janet McCabe continue to lead their offices in an acting or de facto capacity pending their Senate confirmation.
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EPA Adds Mercury Limit to Phosphoric Acid Standards
Aug 19, 2015 | BNA Daily Environment Report
By Patrick Ambrosio
The Environmental Protection Agency has updated its federal emissions standards for phosphoric acid manufacturing facilities to limit previously unregulated mercury emissions.
The final rule, which went into effect Aug. 18, sets a new limit of 0.014 milligram per dry standard cubic meter for mercury emissions from phosphate rock calciners at those facilities. The calciners were previously only regulated for particulate matter emissions under federal standards.
The agency said the new emissions limit will mitigate future increases of mercury emissions from facilities that manufacture phosphoric acid, a chemical that is used in food manufacturing. The EPA didn't quantify the expected reductions from the new mercury limit.
The new emissions limit was included in a final rule (RIN 2060-AQ20) that resulted in a periodic residual risk and technology review for facilities in the phosphoric acid manufacturing and phosphate fertilizer production source categories. Those are two of the 28 industrial source categories that the EPA agreed to review under a consent decree that resolved a lawsuit from the Sierra Club, which alleged that the agency failed to meet its statutory deadlines to periodically review and, if necessary, update the toxic pollutant standards (Sierra Club v. Jackson, N.D. Cal., No. 09-152, consent decree approved, 9/26/11; 128 DEN A-6, 7/7/10).
New Work Practice Standards
The final rule made several other changes to the phosphoric acid standards, including the creation of new work practice standards to control hydrogen fluoride emissions from certain types of equipment.
The agency also removed existing regulatory exemptions for startup, shutdown and malfunction, the result of a 2008 federal appeals court ruling that concluded the exemptions violated the Clean Air Act (Sierra Club v. EPA, 551 F.3d 1019, 68 ERC 1033, 2008 BL 282130 (D.C. Cir. 2008); 245 DEN A-5, 12/22/08).
The EPA estimated the final rule will cover 13 facilities in the U.S. and impose capital costs of $346,000.
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Sunlight Coaxes Urban Grime To Release Smog Compound
Aug 18, 2015 | Chemical & Engineering News
By Michael Torrice
A grimy film covers the streets, statues, and buildings in our cities. This dirty chemical soup, deposited from pollution and dust, could play a previously unknown role in urban air quality, according to research presented Monday at the American Chemical Society national meeting in Boston.
Chemists report that, when hit with sunlight, urban grime may release nitrogen oxides (NOx), which produce ozone and smog. Understanding how this chemical film contributes to NOxlevels in cities could help environmental scientists produce better models of air quality.
The findings are exciting and intriguing, according to Kerri A. Pratt, an environmental analytical chemist at the University of Michigan, Ann Arbor, who was not involved in the work. The new research “directly connects novel laboratory and field measurements for a fundamental study of a previously unaccounted-for source of atmospheric nitrogen-containing compounds.”
Vehicles and power plants release NOx into the atmosphere, where the compounds take part in a reaction cycle that generates ozone. The compounds can leave the atmosphere through side reactions that produce molecules that end up as nitrates in urban grime, a complex mixture of thousands of organic and inorganic chemicals. Scientists had long thought this film was a final destination for NOx, according to D. James Donaldson of the University of Toronto.
Over the past several years, Donaldson’s group has conducted lab experiments showing that these nitrates don’t always stay put when exposed to light. For example, the researchers demonstrated that, when exposed to ultraviolet light, nitrate levels dropped 10,000 times as fast in urban grime as in water (Environ. Sci. Technol.2013, DOI: 10.1021/es3037862). This suggested that there was unique photochemistry involving the nitrates in the films.
At a presentation in the Division of Environmental Chemistry, Donaldson reported on a field study he and colleagues at the Leibniz Institute for Tropospheric Research, in Leipzig, Germany, performed to confirm this chemistry happens in cities. They set up trays of glass beads on a rooftop in Leipzig: Some sat in the shade, and some in direct sunlight. When the researchers measured the nitrate content of the grime on the beads, they found that those that sat in the light had 10% lower levels than those in the shade.
To understand the fate of the nitrates, the scientists went back to the lab and put grime-covered glass particles inside a photoreactor. The team observed that NOx was one of the gases released from the illuminated grime.
Donaldson next wants to take the data on NOx release and feed it into simple computer models to estimate the extent of NOx production from urban surfaces. “What we could do then is input that into urban air quality models to say that there is an extra source, or a recovery, of NOx that hasn’t been accounted for,” he said.
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Mining Company Urges 9th Circuit To Reverse Novel CERCLA Air Ruling
Aug 18, 2015 | InsideEPA
By Suzanne Yohannan
One of Canada's largest mining and mineral development companies is urging a federal appellate court to reverse a lower court's novel ruling that found air emissions stemming from a mining facility constituted "disposal" of hazardous substances under Superfund law, which the company argues conflicts with a 2014 ruling by the same appellate court.
The company, Teck Metals, also contends that the lower court decision creates inconsistencies within the Comprehensive Environmental Response, Compensation & Liability Act (CERCLA), also known as the Superfund law, and Clean Air Act. "While CERCLA and the Clean Air Act address different environmental issues, in this case the District Court's holding creates serious inconsistency between CERCLA and the Clean Air Act," Teck Metals says in its Aug. 4 opening brief filed in the U.S. Court of Appeals for the 9th Circuit inJoseph Pakootas, et al. v. Teck Cominco Metals.
The case, pitting Native American tribes and the state of Washington against Canada's largest diversified resource company, could have significant implications for CERCLA liability at sites across the country.
The U.S. government has warned that a reversal of the lower court decision allowing emissions to qualify as disposal of hazardous substances could undermine CERCLA's reach. Private sector attorneys have separately argued that upholding the lower court decision could expand CERCLA's scope.
The 9th Circuit accepted the case on interlocutory appeal March 25, making it the first circuit court to address whether air emissions leading to disposal onto land or water are actionable under CERCLA. The court is being urged to overturn the U.S. District Court for the Eastern District of Washington's July 29, 2014, ruling that opened air emissions to coverage under CERCLA.
In the case, the state of Washington and Native American tribes allege that air emissions, in addition to discharges that flowed into the Columbia River, from a lead/zinc smelter operated by Teck for more than 100 years just north of the U.S. border in British Columbia, Canada, resulted in the "disposal" of hazardous substances at the Upper Columbia River site in Washington, according to the United States in an amicus brief filed with the district court.
While the district court had previously determined Teck was liable for releases from millions of tons of smelter waste deposited in the river, the plaintiffs later filed amended complaints implicating the air emissions as well, the brief says. The district court ruled that the plaintiffs' claims could go forward alleging air emissions as a basis for recovery of response costs and natural resource damages.
The appeals court must now decide whether Pakootas contradicts the 9th Circuit's Aug. 20, 2014, decision inCenter for Community Action and Environmental Justice (CCAEJ) v. BNSF Railway Company, a case with similar claims under the Resource Conservation & Recovery Act (RCRA).
'Disposal' Definition
At issue, in light of CCAEJ, is whether "the definition of 'disposal' in CERCLA is satisfied by allegations that hazardous substances were emitted into the air and then transported by wind, eventually settling onto land or water," says Teck's brief to the appellate court.
"In other words, did the District Court err in construing 'disposal' under CERCLA to cover Plaintiffs' allegations, where: (a) CERCLA expressly incorporates the definition of 'disposal' from RCRA, and (b) this Court has already determined that 'disposal' under RCRA does not include emissions to the air in the first instance that eventually fall to land or water?"
In CCAEJ, the 9th Circuit rejected a claim by environmentalists that diesel particulate matter emitted from locomotives at 16 railyards in California constituted disposal of solid waste under RCRA.
The court said RCRA's definition of disposal only includes "conduct that results in the placement of solid waste 'into or on any land or water,'" but is not solid waste under RCRA if the substances are first emitted into the air and then travel onto land and water. The court said that disposal, however, does occur if the waste is first placed "into or on any land or water" and then "emitted into the air."
In CCAEJ, the alleged solid waste diesel particulate matter is emitted into the air by locomotives and then travels onto the land and water. To adopt the plaintiffs' interpretation of RCRA "would effectively be to rearrange the wording of the statute -- something that we, as a court, cannot do," the 9th Circuit ruling says. "Thus, we preliminarily conclude -- based on the statute's wording considered alone and in context -- that emitting diesel particulate matter into the air does not constitute 'disposal' as that term is defined under RCRA," the CCAEJ ruling says.
"Because CERCLA expressly incorporates the RCRA definition of 'disposal,' the holding in [CCAEJ] controls here," Teck says in its brief to the 9th Circuit. The company contends that the district court's decision directly contradicts CCAEJ, and says the same analysis applies here.
Applying the district court's reasoning, a disposal would have occurred in CCAEJ "when diesel particulate matter from the locomotives and trucks at the railyards was 'first' deposited on land near the railyards, despite having been emitted to air before depositing on the ground," Teck says.
"The District Court's view is irreconcilably inconsistent" with CCAEJ, "and would allow a plaintiff to assert, under RCRA or CERCLA, that a 'disposal' occurs whenever any hazardous substance is initially emitted into the air, transported by wind, and eventually falls to land or water, however remotely," it says.
Arranger Provisions
In its order refusing to reconsider its ruling last year in light of CCAEJ, the district court distinguished its decision from CCAEJ, noting differences between RCRA and CERCLA. It noted that it did not find that air emissions from the smelter constitute a "CERCLA disposal." CERCLA's arranger provisions attach liability for disposal of hazardous substances at a facility where there is a release of hazardous substances. The smelter is not a "facility" under CERCLA, it says, rather the "facility" is the Upper Columbia River site in the United States.
The district court said that the "CERCLA disposal" in this case "occurred when hazardous substances from Teck's aerial emissions and its river discharges were deposited 'into or on any land or water' of the UCR Site. This disposal occurred in the 'first instance' into or on land or water of the UCR Site and therefore, does not run afoul of RCRA's definition of 'disposal' as interpreted by the Ninth Circuit in CCAEJ."
But Teck in its new filing says Congress adopted the same definition of "disposal" in CERCLA as in RCRA.
Teck also argues that the district court ruling creates conflicts between CERCLA and the Clean Air Act. Congress entrusted EPA, not the courts, with regulating air emissions under the Clean Air Act.
"If, as the District Court holds, 'disposal' under CERCLA includes emissions into the air that are transported by wind and settle onto land or water, CERCLA could be used to contradict the reasoning of Congress in vesting the EPA with the duty to regulate air emission under the Clean Air Act," Teck says.
CERCLA, unlike the air law's limited citizen suit provisions, allows a private right of action to recover cleanup costs against other responsible parties. "Interpreting 'disposal' to include emissions into the air thus would open the door to CERCLA cost recovery suits that would undermine the broad regulatory scheme created by the Clean Air Act for addressing emissions," the company says.
Further, Teck says while the air law generally limits quantities of emissions, rather than prohibiting them, "CERCLA may impose liability for essentially any hazardous substances which may be present at a facility, regardless of quantity or risk." Holding a party liable for air emission deposits would contradict Congress' decision to address air pollution risks via the air law, it says, citing case law that gives deference to more comprehensive laws over general statutes that might otherwise undermine the regulatory scheme established by the comprehensive statute.
'Unwarranted Expansion'
In addition, the company argues the district court ruling would create "an unwarranted expansion of CERCLA liability, and an equally improper inconsistency with the innocent landowner defense."
Under this defense, current owners of contaminated property may be free from liability if disposal occurred prior to the property's acquisition. But under the lower court's ruling, current landowners would be unable to assert this defense "because the 'disposal' would be a perpetual process that goes on as wind-blown substances continue to settle, including after current owners acquired the property," according to Teck's filing.
In addition, liability would be expanded for past owners of the property "simply because they owned land when wind-blown mercury or other hazardous substances had settled on it," Teck says.
The litigation has drawn interest from the U.S. government, which filed an amicus brief with the district court last year when the court was weighing whether to reconsider its decision.
In the brief, the United States warned against applying Teck's interpretation of the CCAEJ ruling to Pakootas, saying that Teck was urging a narrow reading of CERCLA exempting polluters from liability if their hazardous substances traveled "through the air at all before reaching land or water," putting many sites beyond CERCLA's reach. The United States said discharges to the air from smelters have historically been identified as sources of significant contamination at CERCLA sites around the country, pointing to more than 400 smelter sites with hazardous substance deposition from air emissions.
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Four Powerhouse Bills to Help California get to 50 Percent Renewable Energy
Aug 18, 2015 | Environmental Defense Fund
By Lauren Navarro
California is deep into the dog days of summer, and pressure is mounting on the state’s electric grid to keep up with demand. Luckily, California’s legislature is working to bring more clean energy resources to the grid, diversifying how we power our homes and businesses while also improving the resiliency, efficiency, and carbon footprint of our energy system.
State lawmakers are directly addressing our dependence on polluting fossil fuels used to produce electricity. They are doing this by increasing California’s reliance on renewable energy, establishing energy efficiency resource standards, and providing certainty that California will meet its renewable energy and climate goals. The state’s current Renewable Portfolio Standard (RPS) has alreadyachieved tremendous success in growing the market for renewables while bringing down associated costs. Building on this success, California’s legislature is currently undertaking four bills that will keep the state on a path to a reliable, affordable, and clean energy future – for the health of its citizens and economy.
The following bills are all advancing through the legislature and Environmental Defense Fund (EDF) hopes they will become law this year. If they do, they will put some serious voltage behind California’s transition to a cleaner electric grid.
Senate Bill 350 (De León)
SB 350 is the centerpiece of this year’s clean energy legislation. The bill would implement the governor’s goals of increasing renewable energy from 33 percent in 2020 to 50 percent by 2030, reducing petroleum use 50 percent by 2030, and doubling energy efficiency in buildings by 2030. By establishing a successful framework for California’s energy system of the future, SB 350 will help ensure that current and future generations of Californians will continue to reap the health and economic benefits of a clean energy economy.
Assembly Bill 1330 (Bloom)
Also known as the Energy Efficiency Resource Standard Act, AB 1330 will require increased use of energy efficiency and prioritize projects in disadvantaged communities. Critically, it requires the California Energy Commission to set goals for demand response, which can play a pivotal role in integrating clean energy resources onto the electric grid by shifting energy use to times when renewables are abundant, instead of relying on expensive, dirty fossil fuels.
Assembly Bill 33 (Quirk)
This bill will help ensure California is able to meet its renewable energy goals by establishing an advisory inter-agency council that will help to coordinate renewable strategies across the various agencies with authority over the electricity sector. Representatives from the California Energy Commission, the California Public Utilities Commission (CPUC), and other agencies will analyze how to fully integrate increasing levels of renewable resources with the least amount of greenhouse gas pollution possible and at the lowest cost. The outcome of this analysis would inform the California Air Resources Board’s (ARB) next AB 32 Scoping Plan, a document which describes the approach California will take in order to achieve its greenhouse gas reduction goals laid out by the state’s landmark 2009 climate legislation.
Assembly Bill 197 (Garcia)
AB 197 would require utilities and the CPUC to take California’s greenhouse gas limit into account when developing and evaluating utilities’ plans to meet the 50 percent RPS goal envisioned in SB 350 (see description above) – further reducing the state’s reliance on fossil fuels while meeting its energy needs. The bill would also require utilities to examine how their chosen energy resources will work together to meet the RPS. This will help develop a balanced energy portfolio that provides clean, renewable energy more consistently throughout the day and night.
These bills, if passed, will help advance California’s clean energy and climate goals – in fact they are essential for achieving them. They build on and enhance the investments the state has already made (and will continue to make) in renewable energy, resulting in cleaner air for our citizens. Further, these bills will bring significant economic benefits to the state, including more clean energy job growth and reduced utility operating costs – savings that can be passed onto customers.
EDF urges the legislature to vote these bills into law, continuing California’s climate leadership and forging a path toward a clean energy economy.
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