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(ACC Mentioned) U.S. Chemical Production Up in July, All Regions Nab Gain
Aug 20, 2015 | Zacks
U.S. chemical output ticked up in July with higher production witnessed across all chemical producing regions – according to the latest monthly report from the American Chemistry Council ("ACC"). -
(ACC Mentioned) U.S. Specialty Chemicals Market Stable
Aug 20, 2015 | Powder & Bulk Solids
The Specialty Chemicals Market Volume Index, a new tool created by the American Chemistry Council (ACC), began the third quarter on a stable note. This follows steady monthly declines since December as weakness in oilfield chemicals and a few other segments weighed on overall volumes. -
(ACC Mentioned) Why is the Nanotech Industry So Intent on Keeping EPA From Doing its Job?
Aug 20, 2015 | Environmental Defense Fund
By Richard Denison
Ten years and counting. That’s how long EPA has been trying to gather the most basic information on nanoscale materials in commerce. -
EPA Revises Guide To Lower PCB Exposures In Schools, Draws Criticisms
Aug 20, 2015 | InsideEPA
By Suzanne Yohannan
EPA has updated guidance on addressing polychlorinated biphenyls (PCBs) in older schools' construction materials and is stressing risk-reduction best management practices (BMPs) to avoid exposures at facilities built or renovated during a 30-year span, but one critic says the guide weakens past recommendations and neglects testing of building materials for high levels of PCBs. -
Group Cries Foul Over Changes to EPA Guidance on PCBs
Aug 20, 2015 | E&E - Greenwire
By Sam Pearson
New online guidance from U.S. EPA meant to guide building owners concerned about the presence of polychlorinated biphenyls, or PCBs, is worrisome because it de-emphasizes testing for the materials in the locations most likely to contain the chemicals, a watchdog group claims. -
Is Your Drinking Water Safe?
Aug 20, 2015 | Environmental Working Group
By Megan Boyle
How many times a day do you drink water? Cook with it? Brush your teeth with it? Offer some to your children? -
Breastfeeding Exposes Babies to Water- and Stain-Proofing Chemicals
Aug 20, 2015 | Environmental Health News
By Brian Bienkowski
Breastfeeding appears to expose infants to a group of industrial chemicals linked to immune system problems, according a study released today. -
Class Action Suit Brought Against 'Natural' Diapers and Wipes
Aug 20, 2015 | Chemical Watch
By Kelly Franklin
Two women have brought a class action lawsuit against Kimberly-Clark over the company's representation of “natural” diapers and wipes, which they claim contained “potentially hazardous” chemicals. -
US Agency to Launch E-filing Pilot Programme
Aug 20, 2015 | Chemical Watch
The US Consumer Products Safety Commission is to launch a pilot programme to test its proposed “e-filing” rule, which will amend existing laws covering how imported consumer products demonstrate compliance with US laws, including chemical regulations. -
Reid Sees Chance for Compromise on Oil Exports
Aug 20, 2015 | PoliticoPro
By Andrew Restuccia
Senate Minority Leader Harry Reid said he sees room for a compromise on the effort to lift the ban on U.S. crude oil exports, and he broke with President Barack Obama on Arctic drilling. -
With Mexican Crude Swaps, Obama Keeps Exports Debate at Arm's Length
Aug 20, 2015 | E&E - Energywire
By Jenny Mandel
Last week, on a quiet Friday in August, news leaked from the U.S. Department of Commerce that it had agreed to a number of crude oil swaps with Mexico, a relaxation of long-standing precedents against any such shipments. -
In Denver, Bipartisan Agreement that Ban Has 'Outlived its Usefulness'
Aug 20, 2015 | E&E - Energywire
By Jennifer Yachnin
Advocates for lifting the crude oil export ban gathered here yesterday to discuss their hopes of repealing the 1970s-era restrictions, offering a plethora of ideas about increasing public support from social media messaging to addressing the longtime concerns that the United States' oil supply could one day run dry. -
EPA Methane Proposal Could Shutter Small Drillers -- Analysts
Aug 20, 2015 | E&E - Energywire
The Obama administration's move to tighten federal methane regulations could be the final push toward closure for drillers that are already struggling in an environment of low oil and natural gas prices, according to Oppenheimer & Co. Inc. -
Enviros, Interior Negotiating Settlement in Offshore Fracking Case
Aug 20, 2015 | E&E - Energywire
By Ellen M. Gilmer
The Obama administration is in settlement talks with an environmental group that opposes offshore hydraulic fracturing in the Pacific Ocean. -
Court Rejects Bid by EPA Foes to Retain Judges -- For Now
Aug 20, 2015 | E&E - Greenwire
By Jeremy P. Jacobs
A federal appeals court yesterday denied -- at least for now -- an effort by 15 states challenging U.S. EPA's landmark greenhouse gas standards for power plants to retain a conservative panel of judges for their latest lawsuit. -
EPA Regs Morphed from Inferior Option to 'Wicked Cool'
Aug 20, 2015 | E&E - Greenwire
By Robin Bravender
The Obama administration released big new climate rules this month with much fanfare, hailing them as "historic," an "incredible economic opportunity" and "wicked cool."
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(ACC Mentioned) U.S. Chemical Production Up in July, All Regions Nab Gain
Aug 20, 2015 | Zacks
U.S. chemical output ticked up in July with higher production witnessed across all chemical producing regions – according to the latest monthly report from the American Chemistry Council ("ACC").
The Washington, DC-based chemical industry trade group said that the U.S. Chemical Production Regional Index ("CPRI") edged up 0.3% for the reported month following a revised 0.2% rise a month ago. The U.S. CPRI, which is measured using a three-month moving average, was created by Moore Economics to track chemical production in seven regions nationwide. It is comparable to the Federal Reserve’s industrial production index for chemicals.
Per the ACC, activity for the U.S. manufacturing sector – the largest consumer of chemical products – rose 0.2% in July following gains in the previous two months. The sector is a major driver for the chemical industry which touches around 96% of manufactured goods.
U.S. factory activity picked up on a monthly comparison basis in July on healthy new business growth. A stronger dollar, however, continues to put pressure on U.S. manufacturers as it is making American-made products costlier in other nations.
Within the manufacturing sector, production rose in several chemistry end-user markets in July including motor vehicles, construction supplies, computers, plastic products and furniture.
The July reading showed higher chemical production across all seven regions. Production in the Gulf Coast, where key building block materials are produced, scored the maximum gain of 0.6% on a monthly comparison basis in the reported month. Production went up 0.3% across West Coast, Midwest and Mid-Atlantic. Output rose 0.2% across Ohio Valley and Northeast while Southeast racked up a 0.4% gain.
By segments, chemical production was mixed in the reported month. Gains across organic chemicals, inorganic chemicals, synthetic rubber, plastic resins, agricultural chemicals and pharmaceuticals were neutralized by lower production of industrial gases, consumer products, coatings, manufactured fibers and other specialties.
Overall chemical production went up 3.7% year over year in July with all regions logging gains.
The U.S. chemical industry, a more than $800 billion enterprise, is heavily linked to the overall condition of the nation’s economy. It has been consistently leading the U.S. economy’s business cycle due to its early position in the supply chain. The industry is gradually gaining strength after being shaken up by the global economic crisis.
Despite headwinds from a stronger greenback and depressed demand in energy markets, the U.S. chemical industry is poised for growth this year and the next. The ACC expects U.S. chemical production to rise 3.2% this year and 3% in 2016, both higher than 2% growth seen in 2014.The ACC expects demand for chemicals to grow on continued healing across end-use markets and the industry’s sustained competitiveness. The trade group also expects chemical production to pick up pace on the heels of new capital investments and capacity additions.
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.
Leveraging the abundant natural gas supply, chemical makers including Dow Chemical (DOW -Analyst Report), LyondellBasell Industries (LYB - Analyst Report), Eastman Chemical (EMN - Analyst Report), Celanese (CE - Analyst Report) and Westlake Chemical (WLK - Snapshot Report) are ratcheting up investment on shale gas-linked projects which is expected to beef up capacity and export over the next several years.
A gradually improving U.S. economy, sustained healthy momentum in the automotive space and gradually convalescing construction markets augur well for the American chemical industry in the second half of 2015. -
(ACC Mentioned) U.S. Specialty Chemicals Market Stable
Aug 20, 2015 | Powder & Bulk Solids
The Specialty Chemicals Market Volume Index, a new tool created by the American Chemistry Council (ACC), began the third quarter on a stable note. This follows steady monthly declines since December as weakness in oilfield chemicals and a few other segments weighed on overall volumes.
Of the 28 specialty chemical segments included in the index, 16 expanded in July, nine declined, and three were flat.
The overall specialty chemicals volume index was off 0.1 percent year-over-year (Y/Y) on a three-month moving average (3MMA) basis. Year-earlier comparisons were generally in the 4.0 to 6.8 percent range during 2012-2014, but ongoing weakness in the oil and gas sectors continue to affect headline volumes. Still, on a Y/Y basis, gains are fairly widespread among most market and functional specialty chemical segments. Compared to last year, July volumes were up in twenty-one segments and down in seven segments, though year-earlier comparisons have been moderating.
Specialty chemicals are materials manufactured on the basis of the unique performance or function and provide a wide variety of effects on which many other sectors and end-use products rely. They can be individual molecules or mixtures of molecules, known as formulations. The physical and chemical characteristics of the single molecule or mixtures, along with the composition of the mixtures, influence the performance end product. Individual market sectors that rely on such products include automobile, aerospace, agriculture, cosmetics, and food, among others.
Specialty chemicals differ from commodity chemicals. They may only have one or two uses, while commodities may have multiple or different applications for each chemical. Commodity chemicals make up most of the production volume in the global marketplace, while specialty chemicals make up most of the diversity in commerce at any given time, and are relatively high value with greater market growth rates. Some areas where specialty chemicals are used include adhesives, cleaning materials, cosmetic additives, construction materials, food additives, fragrances, and detergents
This data is the only timely source of market trends for 28 market and functional specialty chemical segments. Chemistry directly touches over 96 percent of all manufactured goods, and trends in these specialty chemical segments provide a detailed view of trends in manufacturing. The data also sheds light on how various consumer end-use markets are performing compared to others in the marketplace. -
(ACC Mentioned) Why is the Nanotech Industry So Intent on Keeping EPA From Doing its Job?
Aug 20, 2015 | Environmental Defense Fund
By Richard Denison
Ten years and counting. That’s how long EPA has been trying to gather the most basic information on nanoscale materials in commerce. And that’s how long the nanotech industry has been throwing up roadblocks – despite its rhetoric that it supports EPA’s effort, which it sees (in theory) as a means to “favorably and efficiently address unwarranted concerns that have been raised” about the products of nanotechnology. This “say-one-thing, do-another” approach is both unfortunate and ironic, given that it has stymied getting to a well-informed government oversight system for nanotechnology that the industry should recognize is in its own best interest.
The latest round comes in the wake of EPA’s proposal of a reporting rule under the Toxic Substances Control Act (TSCA) that would call on makers and processors of nanoscale materials – those in the size range of 1-100 nanometers (nm) – to provide the agency with information relating to the materials’ manufacture, processing and use, as well as available data relevant to understanding their potential exposures and health or environmental impacts. Here’s EPA’s succinct summary of the rationale for the rule:
Nanoscale materials have special properties related to their small size such as greater strength and lighter weight, however, they may take on different properties than their conventionally-sized counterpart. The proposal is not intended to conclude that nanoscale materials will cause harm to human health or the environment; Rather, EPA would use the information gathered to determine if any further action under the Toxic Substances Control Act (TSCA), including additional information collection, is needed.
Despite this modest, common-sense objective, the proposal was met with vociferous opposition from the nanotech industry.
Particularly strident were the NanoBusiness Commercialization Association and the NanoManufacturing Association,[1] each of which filed 30-plus pages of comments challenging virtually every aspect of EPA’s proposal. Other industry groups also criticized the proposal, including the Society of Chemical Manufacturers and Affiliates (SOCMA), SOCMA’s Nanotechnology Coalition, the Chemical Users Coalition, and the American Chemistry Council’s Nanotechnology Panel. (See comments of these and other industry organizations in the docket for the proposed rule here. It should be noted that EPA also received many comments supporting its proposal or arguing that it did not go far enough, includingcomments from EDF.)
Industry commenters have variously called for EPA to withdraw the proposed rule, and either start over from scratch or forgo it altogether. Many of the comments fall into the category of “Don’t make us do this at all,” or “Don’t make us do this until later,” or “Okay, but exempt most of the nanoscale materials we make or use.” Ten years ago some of these stock demands might have held water, but coming after the repeated pushes since then by the industry to delay, dilute and deflect EPA’s voluntary and regulatory efforts – which have denied EPA and the public the information needed to understand the nature and extent of nanoscale materials in commerce – those demands warrant scant consideration.
Most galling are the industry’s calls for EPA to wait until it can specify in minute detail every aspect of the proposal – precise test methods for nano-specific properties; delineation of exactly how the information will be used; identifying nanoscale materials subject to reporting based on evidence of risk – all of which put the cart far ahead of the horse because they would require EPA having access to the very information it is seeking to collect via the reporting rule!
Industry also urges EPA to allow reporting of information in a manner that does not distinguish between bulk and nanoscale forms, or between different nanoscale forms, of the same chemical structure – an approach that would defeat the very reason for requiring reporting in the first place. It is precisely the variability and nature of engineered changes (even if quite subtle) in size and other characteristics of nanoscale materials that imbue them with unique or enhanced properties; EPA needs information at that level of granularity in order to begin to understand how such variation or changes influence the fate and behavior of nanoscale materials in ways that may be risk-relevant.
Long history of industry opposition
Unfortunately, none of this resistance from the industry is new; indeed, this latest round is déjà vu all over again.
It has been 10 years since a federal advisory committee that included industry participants identified the development of reporting rules for nanoscale materials as a near-term need. EPA indicated at that time that it was initiating such an effort, alongside development of a voluntary reporting program – which ultimately drew only paltry industry participation and yielded little useful information. I’ve recounted several times on this blog the long, sad history of this ill-fated endeavor by EPA and the active effort of the nanotech industry to thwart it; see here, here, and here.
Given the history-repeating-itself nature of this ordeal, I have neither the space here nor the patience to rebut the slew of beefs the industry has voiced over EPA’s current proposal. But I do want to take up a couple of claims made by the NanoBusiness Commercialization Association (NanoBCA), as they strike right at the heart of EPA’s ability to address nanoscale materials under TSCA. The NanoManufacturing Association and ACC’s Nanotechnology Panel made similar claims.
Smoke and mirrors
NanoBCA’s main argument is that EPA cannot require reporting specifically of nanoscale materials under TSCA because TSCA doesn’t allow EPA to distinguish nanoscale materials from their bulk counterparts (i.e., larger-sized versions of a material with the same chemical structure). This line of argument first surfaced ca. 2007 when EPA was considering whether nanomaterials were “new chemicals” under TSCA. Specifically, the question was whether or not new nanoscale forms of chemical substances whose bulk forms were already in commerce should be treated as new chemicals under TSCA. Such a designation would require companies to file premanufacture notifications (PMNs) and would afford EPA an opportunity to review their safety prior to commencement of manufacturing.
In 2007, EDF and the National Institute for Occupational Safety and Health(NIOSH), among others, argued that EPA has full authority – as well as strong policy reasons – to designate new nanoscale forms of existing substances as new substances under TSCA. (Note that the California Department of Health filed comments on EPA’s current proposed rule calling on the agency again to take this approach.) Nonetheless, in 2008, EPA issued a policy statement indicating that it would not consider new nanoscale forms of chemical substances whose bulk forms were already in commerce as “new chemicals” under TSCA.
Blurring the distinction between premanufacture notification and reporting
EDF continues to believe that EPA made the wrong policy call in 2008 – on both legal and policy grounds – with respect to whether new nano forms of existing substances are new chemicals. But even if one accepts EPA’s position with regard to premanufacture notification under Section 5 of TSCA, NanoBCA in its comments tries to extend this line of argument far beyond that limited context. It argues that EPA cannot require reporting under TSCA Section 8(a) of different nanoscale forms of a chemical substance.
But it simply does not follow that Section 8(a) or any other provision of TSCA precludes EPA from collecting information on differences with respect to the same chemical substance. EPA can and does routinely require separate reporting: bydifferent companies making the same chemical, or by the same company making the same chemical at different sites; of different processes used in the manufacturing or processing of the same chemical; of different uses of the same chemical; of different byproducts resulting from the manufacture, processing, use or disposal of a chemical.
Getting information on these differences is important, as they can bear directly on the potential for exposure and risk.
TSCA Section 8(a) gives EPA broad authority to require reporting related to chemical substances “as the Administrator may reasonably require.” It imposes only two limitations on that authority with respect to requiring reporting in different settings involving the same chemical substance. EPA cannot require reporting of: (a) “a chemical substance in small quantities (as defined by the Administrator by rule) solely for purposes of scientific experimentation or analysis” or (b) “changes in the proportions of the components of a mixture” unless the reporting “is necessary for the effective enforcement” of TSCA. Outside of these two limitations, EPA can require reporting of information that differentiates between the different circumstances under which the same chemical substance is manufactured, processed, distributed, used or disposed of. And that in turn can encompass information on different forms of a chemical substance, including those at the nanoscale.
In sum, NanoBCA’s argument seeks to obscure and confuse what are clearly two distinct aspects of TSCA: Circumstances that define when a substance is considered “new” and hence requires premanufacture notification (pursuant to Section 5); and EPA’s authority to require reporting of information on chemical substances (pursuant to Section 8), which clearly may include information that characterizes variability or differences in the composition or activities associated with a chemical substance. The former is tied to TSCA’s definition of a chemical substance, while the latter is not.
Seeking to constrain what information EPA can collect on existing nanoscale materials
NanoBCA also makes the astounding claim that “[t]he manufacturer or processor of such [nanoscale] chemical substances is not required to provide EPA with information on the size or the related properties of a nanoscale chemical substance, unless the substance is a new chemical substance for which notification is required under TSCA Section 5(a).” (page 7) Again, nothing in TSCA supports such a claim. (Note that the information TSCA requires companies to provide EPA in their Section 5(a) notices for new chemicals is actually specified under Section 8(a), which Section 5 expressly cross-references (see Section 5(d)(1)). In other words, the information required for new chemicals is the very same information EPA is authorized to require be reported under Section 8(a) for existing chemicals.)
NanoBCA’s point that EPA can only require reporting under Section 8(a) of information that already exists is correct, of course – as is readily acknowledged by EPA in its proposed rule (see proposed section 704.20(d) on p. 18341 of theFederal Register publication of the proposed rule).
Ironically, later in its comments, NanoBCA argues the opposite of its earlier claim, and in the process also makes a statement that supports the view (long held by EDF) that properties such as particle size are part of the “chemical identity” of a chemical substance (and hence can be used as a basis to distinguish among nanoscale and bulk forms of chemical substances with the same chemical structure). NanoBCA states:
[S]ince morphology data may be necessary to determine the “molecular structure” of a chemical substance, and particle size and surface modification data are arguably pertinent to the “chemical identity” of a chemical substance with a given molecular structure, it appears that EPA may have sufficient authority under TSCA Section 8(a)(2)(A)40 to require reporting of these types of data in those instances where they exist. (page 24)
Why does this matter?
These questions are not merely academic: They go directly to the heart of what makes nano nano. The nanotech industry is all about new and different. The entire rationale for engineering materials at the nanoscale is to impart them withnew and different properties. While that is done for reasons of performance, it doesn’t take a rocket scientist – or nanotechnology engineer – to recognize that changes in the core properties of a material may alter its behavior in the environment or when it comes into contact with biological systems in ways that could affect its risk potential.
So it’s particularly vexing to have the very industry that best understands how different nanoscale materials are from their conventional siblings turn around and play dumb when it comes to EPA’s modest efforts to better understand the health and environmental implications of those differences. In seeking to erect legal barriers to EPA’s authority to gain a better understanding of nanoscale materials, NanoBCA and other industry commenters on EPA’s proposed rule would have us believe that there’s nothing new here that EPA needs to know about. That’s hypocritical.
None of this is about unfairly stigmatizing nanoscale materials; rather, it’s quite the opposite. As I said in a 2011 post to this blog:
The real danger to the future of nanotechnology is continuation of a government oversight system that is too antiquated, resource-starved, legally shackled and industry-stymied to provide to the public and the marketplace any assurance of the safety of these new materials as they flood into commerce.
[1] It is not clear who the NanoManufacturing Association represents, as neither their comments nor their website provide any listing of members. A footnote in NMA’s comments merely indicates it is “an alliance of private companies and trade associations.” The comments were prepared and filed by Keller and Heckman. In contrast, the members of the NanoBusiness Commercialization Association, SOCMA’s Nanotechnology Coalition, the Chemical Users Coalition, and the American Chemistry Council’s Nanotechnology Panel are identified in their comments and/or on their websites.
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EPA Revises Guide To Lower PCB Exposures In Schools, Draws Criticisms
Aug 20, 2015 | InsideEPA
By Suzanne Yohannan
EPA has updated guidance on addressing polychlorinated biphenyls (PCBs) in older schools' construction materials and is stressing risk-reduction best management practices (BMPs) to avoid exposures at facilities built or renovated during a 30-year span, but one critic says the guide weakens past recommendations and neglects testing of building materials for high levels of PCBs.
An attorney with Public Employees for Environmental Responsibility (PEER) is generally critical of the revisions to past guidance. "It seems as if they weakened the already-weak advice on PCBs in schools," the attorney says.
EPA, in its July 28 "PCBs in Building Materials -- Questions and Answers" updated guidance, says PCBs were potentially widely used in building materials in schools and other buildings built or renovated between 1950 and 1979. Banned since 1976, PCBs are regulated under the Toxic Substances Control Act (TSCA). They are a probable human carcinogen and may lead to various non-cancer health effects, EPA says. They were used in a variety of commercial products such as caulk, electronics, fluorescent lighting and other building materials.
The guidance aims to reduce potential exposures, and calls for school administrators and others to undertake BMPs "such as removing all PCB-containing fluorescent light ballasts (FLBs) from schools and other buildings since they can be a significant source of PCBs, improving ventilation, keeping surfaces clean to reduce dust that may contain PCBs, and improving building occupant hygiene."
The new guidance stresses risk reduction measures such as BMPs, and refrains from directly calling for air or materials testing for PCBs. Instead, EPA in the guidance frequently defers to school administrators consulting with EPA regional PCB coordinators on such matters.
The agency says that after implementation of BMPs, "School administrators should consult with their EPA Regional PCB Coordinator to assess if there still may be the potential for PCB releases in their school and whether to consider testing indoor air for PCBs."
"Each school is unique, which means that many factors should be considered when deciding whether and how to test the indoor air at a school," the agency says in a fact sheet. The EPA PCB coordinator and schools should consider "school-specific conditions (e.g., building age, types of materials used in construction, layout, maintenance or renovation history), BMPs already implemented to address PCB sources, and available technical resources, costs, and public concerns," the fact sheet says.
'Next Steps'
If air testing finds high levels, school administrators should again consult with regional PCB coordinators "on appropriate next steps, such as the implementation of BMPs and whether manufactured sources (e.g., FLBs, caulk, paint) or secondary sources (e.g., paint, ceiling tiles) of PCBs should be investigated," the guidance says.
The decision to recommend site-by-site consultations on testing issues follows disagreements within the agency over how much testing and cleanup the agency should recommend or require in the guidance for PCB materials in schools.
During the new guidance's development, the agency was considering whether resources should be spent on removal upfront rather than testing, an EPA source said at the time.
Previously EPA's guidance called for testing caulk in buildings, according to sources familiar with the documents. But now the agency is not advising testing materials such as caulk, as PCB exceedances in materials above 50 parts per million (ppm) would trigger legal requirements to immediately remove the substance, the PEER attorney says. While materials with levels of PCBs at 50 ppm or higher must be removed, no federal requirement exists for testing materials for PCBs, according to EPA. But the source says EPA is "completely neglecting" the building material requirement.
The guidance does recommend PCB testing for caulk and other materials if the materials are already going to be removed as part of renovation or repair activities. This will help determine the level of protection needed during removal and determine disposal requirements, it says.
An environmentalist who has advocated for PCB removals in schools in the past is critical of the recommendation to rely on regional PCB coordinators, saying PCB coordinators seemed uninformed during workshops held four to five years ago on PCBs in schools. "I'm leery now that they would be experts to help folks figure out" if additional testing is needed, the source says. The source adds that there is "no question" that testing should be done, and recommends that EPA provide grant money to pay for it.
In the updated guidance, the agency also gives assurances to school districts that, provided they follow the new guidance to limit PCB exposures, they will be a "low priority for enforcement" should caulk or other building materials be tested and found at levels above the 50 ppm regulatory limit. EPA regulations pursuant to TSCA bar the use of PCBs in caulk and other building materials, including the continued use of such materials already in place, above 50 ppm, the guide notes.
"Although EPA does have enforcement tools that it can use as appropriate where the PCB concentration in the caulk or other materials is above the regulatory limit, EPA is most interested in ensuring that school districts and other building owners undertake the recommended actions to limit exposures to PCBs," the guidance says. "EPA believes that enforcement may not be the most effective tool to reduce health risks when school districts and other building owners follow these recommendations."
The low priority for enforcement contrasts with pressure from PEER and parent groups for EPA to take enforcement action against schools where PCBs have been tested and high levels found. For instance, PEER has sued the Santa Monica-Malibu Unified School District in California and EPA to require further removal of PCB materials from schools there.
Exposure Levels
The PEER attorney is also critical of the guide's apparent weakening of its suggested guidelines for exposure levels for evaluating PCBs in indoor air. The guidance provides exposure levels based on a child's age, and for some of these the agency has increased the level of PCBs that children could be exposed to, the source says. In addition, these exposure levels have no legal basis, the source says. Further, the source argues that the air guidelines EPA is advising have a weak scientific basis because they are inhalation levels extrapolated from ingestion levels.
EPA says in the guidance that while accepted analytical methods to measure PCBs in indoor air exist, there is not a "broadly accepted sampling protocol" for such testing. Therefore, the agency says it cannot support a "generic recommendation on indoor air testing due to the many different school-specific situations encountered in designing a sampling plan," the guidance says.
If indoor air is tested, school administrators may want to compare test results to exposure levels the agency has calculated for evaluating PCBs in indoor school air. These are based on an oral reference dose of 20 nanograms PCB/kilogram body weight per day, adjusted to reflect a typical school year, the agency says.
"These levels for indoor school air are not meant to be interpreted or applied as 'bright line' or 'not-to-exceed' criteria," EPA says in the guidance. "Rather, measurements above these levels are intended to suggest the need for the further investigation of PCB sources in the school building and other actions to reduce exposure."
On the matter of light ballasts, EPA is being more stringent than in the past, the PEER attorney says. EPA is calling for all replacements of FLBs from the time period during which PCBs were used even though the law does not strictly require that. On this, the source says EPA's recommendation is "not a bad thing."
The guide explains that even intact FLBs may emit small levels of PCBs into the air during use, noting that all PCB-containing FLBs in current use have exceeded their designed lifespan, making them "susceptible to leaking or rupturing at any time which may lead to increased exposures to building occupants," it says.
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Group Cries Foul Over Changes to EPA Guidance on PCBs
Aug 20, 2015 | E&E - Greenwire
By Sam Pearson
New online guidance from U.S. EPA meant to guide building owners concerned about the presence of polychlorinated biphenyls, or PCBs, is worrisome because it de-emphasizes testing for the materials in the locations most likely to contain the chemicals, a watchdog group claims.
Public Employees for Environmental Responsibility -- which is spearheading a lawsuit over PCBs against a California school system -- contends that EPA's recent change discourages schools from testing for PCBs in caulk.
"EPA is basically advising school districts to fly blind -- not recommending caulk testing and discouraging air testing for PCBs," PEER Senior Counsel Paula Dinerstein said in a statement. "Without any public discussion, EPA has retreated to a perverse 'don't-ask-don't-tell' toxic enforcement approach for protecting school children and teachers."
Though PCBs are banned in levels above 50 parts per million under the Toxic Substances Control Act of 1976, the chemicals were often used in caulk within buildings constructed between 1950 and 1980.
However, under regulations promulgated under TSCA, EPA requires schools to remove these materials only when they are detected. At the same time, EPA does not require schools to test for PCBs in caulk unless they first detect air and dust wipe samples containing harmful levels of PCBs -- an attempt not to force costly cleanups of PCBs where no exposure path is present.
Previous EPA guidance noted that it was "possible" that PCBs may still be released from intact, undisturbed caulk, "although the mechanism for such release is not well understood." The new version, though, implies that indoor air quality tests should be conducted after "many factors" are considered.
The document adds, "Isolated or infrequent indoor air PCB measurements that exceed the exposure levels would not signal unsafe exposure to PCBs" but rather are cause for officials to take additional steps to reduce the exposure levels.
EPA also increased guidance estimates of PCB exposure level estimates for children and adults meant not as strict limits but rather "to guide thoughtful evaluation of indoor air quality in schools."
How aggressively EPA must force school districts to take action against PCBs is the focus of a California lawsuit PEER is litigating.
PEER and a recently formed local group, America Unites for Kids, are suing the Santa Monica-Malibu Unified School Districts at the U.S. District Court in Los Angeles, alleging that the district has violated TSCA by not removing additional caulk containing the substance, and are seeking a court order compelling removal.
The district, represented by the law firm Pillsbury Winthrop Shaw Pittman LLP, has argued that the case is without merit and is appropriately left to EPA's discretion. U.S. District Court Judge Percy Anderson ruled in June the lawsuit could proceed, as PEER "had established a likelihood of success" on the merits of the case. Anderson also rejected a motion by PEER for a preliminary injunction requiring faster action.
The case is now in the discovery phase, with a trial scheduled next year, Dinerstein said.
Attorneys for the district argued in a court filing earlier this year that there is no evidence that PCB exposure levels at the school are unsafe and said that the school system has spent nearly two years and more than $3 million addressing the problem.
EPA noted last year that it agrees with the school's approach and "does not recommend additional testing of caulk unless dust or air samples persistently fail to meet EPA's health-based guidelines."
Air samples at the school in November and December 2013 found "roughly 80 percent" of samples met EPA standards, while four exceeded the 50-parts-per-million threshold. Caulk in those areas was removed, but EPA said the findings showed there was "no reason to believe that there [was] an immediate or acute threat to the health of the children or the staff ... from the levels of PCB contamination found," the filing said.
EPA then approved a finding that the school's plan "will not pose an unreasonable risk of injury to health or the environment."
The district's filing said the local group and PEER "appear to be pushing for TSCA reform on Capitol Hill [and] want this Court to set a radical new precedent for PCB management by requiring exhaustive testing of allbuilding material" at the campus.
Usurping the role of EPA would create regulatory uncertainty for thousands of schools across the country, the district argued.
The groups "appear more concerned with attracting publicity for their policy agenda than with actually protecting kids or ensuring the Malibu Campus meets TSCA's safe standards," the filing said.
Dinerstein called this "a nonsensical evasion of confronting the extremely high levels of PCBs that have been found throughout these schools."
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Aug 20, 2015 | Environmental Working Group
By Megan Boyle
Originally published on Healthy Child Healthy World by Megan Boyle.
How many times a day do you drink water? Cook with it? Brush your teeth with it? Offer some to your children?
Safe drinking water is essential to your family’s health and well being, so it’s troubling that a recent study has revealed a new potential risk to U.S. water supplies.
Here’s some key information – and steps you can take to protect your family:
Drinking water contaminated with the toxic chemical PFOA is a more serious health threat than previously thought, according to a new report by EWG. Two leading environmental health scientists have published research showing that exposure to PFOA is harmful at lower concentrations than those found in testing by the Environmental Protection Agency.
PFOA contamination is highest in the mid-Ohio River Valley of West Virginia and Ohio, but the new findings could have nationwide implications. Since 2013, EPA’s testing has detected PFOA in 94 public water systems in 27 states. The contamination levels were considered acceptable at the time, but the recent study now suggests they may be hazardous.
PFOA is a kind of polyfluorinated chemical (PFC). Non-stick, waterproof and grease-proof, PFCs have many commercial uses, such as coating clothing, cookware, carpets, furniture, food wrappers and more.
Toxic even in small doses, PFCs pass from mothers to their unborn babies through the umbilical cord. They have been linked to birth defects, pregnancy complications, kidney and testicular cancers, heart and thyroid disease, and other serious health conditions. Check out EWG’s Guide to Avoiding PFCs to learn more.
DuPont used to use PFOA to make Teflon coatings but eventually phased it out due to the health hazards. Although the chemical is no longer produced in the United States, the damage is done. Today PFOA and its chemical cousins turn up in the blood of almost all Americans and in animals across the globe. Read the full report.
Other common hazardous drinking water contaminants include lead, perchlorate and the herbicide atrazine. Some of these toxic substances cannot be easily removed from drinking water – nor does the EPA always know how much must be removed for safety – but there are steps parents can take to improve the health of their families’ drinking water. Here’s where to start:
Investigate your water supply
Public drinking water utilities test their water regularly for harmful contaminants and are required to disclose the results. Many utilities mail out this information annually to their customers or post it online, so check the website of your local utility or call to request the information.
You can also use the EPA’s Local Drinking Water Information website to search for reports by state regulators, though these reports may be less complete than the ones provided by your utility. If your family drinks from a private well, test the water annually through a state-certified commercial laboratory.
Use a water filter
Using a water filter is one of the best everyday steps you can take to improve the quality of the water your family drinks. There are many options on the market, so consult EWG’s Updated Water Filter Buying Guide to find one that’s right for your needs and budget, such as a carbon filter versus a reverse osmosis system. If your utility’s water testing reveals a high level of a particular contaminant, consider buying a filter certified to reduce that specific one.
Drink from safer containers
Use reusable water bottles made from BPA-free plastic, stainless steel or glass. You’ll reduce waste and your family’s exposure to chemicals that can leech from plastics into the water. If you do choose plastic, keep it away from heat. And don’t use plastic containers to store water for prolonged periods.
Support Chemical Safety Reform
Help keep chemicals out of your water in the first place. Urge your U.S. senator to work to make the pending bill to “reform” the Toxic Substances Control Act truly protective of children’s health. It should protect states’ abilities to set chemical regulations that are stronger than the federal government’s requirements and ensure a strong safety standard.
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Breastfeeding Exposes Babies to Water- and Stain-Proofing Chemicals
Aug 20, 2015 | Environmental Health News
By Brian Bienkowski
Breastfeeding appears to expose infants to a group of industrial chemicals linked to immune system problems, according a study released today.
The study is the first to estimate the transfer of water- and stain-proofing chemicals from mother to baby during breastfeeding and suggests that the mother’s milk—which provides healthy antibodies, vitamins and nutrients— is also a major source of these harmful compounds for the developing children.pratt.eduPhilippe Grandjean
“It’s a very unwelcome surprise that these compounds that we’re just beginning to understand to be toxic actually transfer through human milk to the most vulnerable population group,” said Philippe Grandjean, a professor of environmental health at the Harvard T.H. Chan School of Public Health and co author of the study published today in Environmental Science and Technology.
Grandjean and researchers from Denmark and the Faroe Islands looked at five types of perfluorinated alkylate substances, or PFASs, in the blood of 81 children who were born in the Faroe Islands between 1997 and 2000. They checked the children’s blood at ages 11 months, 18 months and 5 years old, and checked their mother’s blood at week 32 of pregnancy.
They found that children who were exclusively breastfed had levels of the chemicals increase about 20 to 30 percent each month. Children who were only partially breastfed had smaller increases.
One limitation was that they calculated rather than measured levels of the compounds in children at birth, said Glenys Webster, an epidemiologist and post-doctoral fellow at Simon Fraser University. They also did not measure chemical levels in breast milk. But, the pattern they found was compelling and exposure of any kind at such a young age may be of concern, Webster said.
"During the prenatal period and early infancy we are quite sensitive to lots of different exposures," she said.
The findings "highlight the importance of not having these in consumer products,” said Simona Balan, senior scientist with the Green Policy Institute based in Berkeley, California, who was not involved in the study.
Webster said that while this is evidence that breast milk can be a contributor to chemical exposure, breastfeeding is still healthy for babies.
"There are many important benefits of breastfeeding, which still far outweigh the risks," she said. "The real question is how do we reduce moms' exposures in the first place?"
Perfluorinated chemicals have a half-life in people’s bodies of more than three years, which is a long time and makes it difficult for women who might get pregnant to avoid exposure, Balan said. In the current study, the results suggested that several months of breastfeeding lowered the mothers levels of the compounds, presumably transferring to the baby.
The compounds also are not fat or water soluble, and are widely used in products such as waterproof clothing, food packaging, paints and lubricants [think Teflon, Gore-Tex and Scotchgard] to make them nonstick and water resistant.
Researchers have found the compounds in people all over the world, Grandjean said.
"There are many important benefits of breastfeeding, which still far outweigh the risks."-Glenys Webster, Simon Fraser UniversityThere are two types — long chain and short chain, the latter having fewer carbons.
Long-chain compounds, such as perfluorooctanoate (PFOA) and perfluorooctane sulfonic acid (PFOS) are more heavily studied, linger longer in the human body, and have been linked to testicular and kidney cancers, low birth weights, obesity, thyroid disease, high cholesterol and hypertension and low birth weights.
In laboratory animal studies, long chain forms of the chemicals have disrupted immune and endocrine systems, harmed brains and caused tumors.
Three years ago, using this same cohort of children from the Faroe Islands, Grandjean and colleagues reported that exposure to perfluorinated compounds was linked to reduced immune responses in the children at ages 5 and 7.
Jessica Bowman—executive director of the FluoroCouncil, a trade association representing fluorinated compound manufacturers—pointed out that the current study examined long-chain compounds, which are being phased out by members of the council.
“Over a decade ago, FluoroCouncil members started working with U.S. EPA and other regulators to globally phase-out all long-chain PFAS chemistries by the end of 2015," she said in an emailed response. “To help support that phase-out, our member companies developed alternatives, based on short-chain PFAS. The alternatives are some of the most robustly-studied new chemicals introduced into the market."
While they may be less persistent, scientists know "very little" about the toxicity of the short-chain alternatives, Webster said.
Long-chain perfluorinated compounds are “incredibly stable,” Grandjean said. Even with phase-outs, the compounds will persist as they break down very slowly in the environment.
"They're in the marine food chain, they're circulating in oceans ... it's a pervasive and persistent problem." Grandjean said.
"We need to ask 'are we doing the right thing with regards to chemical control, and can we do it better?' Surprises like this shouldn't happen in the future."-Philippe Grandjean, Harvard School of Public HealthPFOS is regulated as a persistent organic pollutant in the European Union, and PFOA is restricted in Norway and there's a proposal to include it under the European Union’s chemical regulation program (REACH).
The U.S. EPA in January of this year proposed requiring manufacturers to let the agency know 90 days in advance if they planned on using certain long-chain fluorinated compounds, so the agency could evaluate if the use is necessary.
The chemicals have increasingly been on scientists’ radar. In May, more than 200 scientists outlined potential health concerns from fluorinated chemicals and urged for replacements and tightened regulations in a report dubbed the “Madrid Statement,” which Balan co authored.
Grandjean said that the passage of chemicals via breast milk is not included in the testing of environmental chemicals, and pointed out that it took researchers many years to discover such transfer with other harmful chemicals such as dioxins, polychlorinated biphenyls (PCBs) and flame-retardants.
“My hope is that this is the last one, but that isn’t a realistic hope,” he said, adding that the timing of this study is critical as U.S. Congress continues to discuss reforms to the nation’s Toxic Substances Control Act, which regulates chemicals.
“We need to ask 'are we doing the right thing with regards to chemical control, and can we do it better?'” Grandjean said. “Surprises like this shouldn’t happen in the future.”
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Class Action Suit Brought Against 'Natural' Diapers and Wipes
Aug 20, 2015 | Chemical Watch
By Kelly Franklin
Two women have brought a class action lawsuit against Kimberly-Clark over the company's representation of “natural” diapers and wipes, which they claim contained “potentially hazardous” chemicals.
The complaint, filed in New York on 6 August, attests that the manufacturer's branding of Huggies “Pure and Natural” diapers and Huggies “Natural Care” wipes is “deceptive”.
In a cover letter to the company, the plaintiffs demand that it “immediately makes full restitution to all purchasers of the diapers and wipes of all purchase money obtained from sales thereof”.
According to the complaint, the “natural” diapers, like the company's traditional diapers, contained “unnatural and potentially harmful ingredients such as polypropylene and sodium polyacrylate". The complaint states that neither substance's presence was disclosed on packaging.
Sodium polyacrylate is a “super-absorbent material”, designed to pull moisture away from the baby's skin, according to the company. The substance is approved by the US FDA as a food additive under prescribed conditions. Kimberly-Clark says that polypropylene, a synthetic material, is used to “enhance the fit of the diaper and help stop leaks”.
Also named in the suit are Huggies Natural Wipes, which the complaint says contained sodium methylparaben and methylisothiazolinone (MIT), substances it describes as "not natural" and "hazardous”.
The complaint says: "Studies have found that sodium methylparaben is a harmful ingredient that can act as a '[h]uman endocrine disruptor' and '[h]uman immune toxicant or allergen'", citing an analysis of methylparaben by activist nonprofit organisation, the Environmental Working Group.
Methylparaben has been the subject of investigation in France as a suspected endocrine disrupting chemical (CW 1 May 2014) and has been shown to increase the risk of cancer (CW 14 September 2011). Sodium methylparaben is permitted for use in cosmetics in the EU, in concentrations up to 0.4%.
In the EU, the European Commission has proposed banning MIT in cosmetic leave-on products becuse of its sensitising potential, and it is listed on the Canadian cosmetic ingredient hotlist (CW 31 July 2015). According to the plaintiffs, it has been linked to immune system and skin toxicity, and to allergic reactions.
“Because the products contain unnatural ingredients, Kimberly-Clark's claim that the products are 'natural' is false, misleading, and designed to deceive consumers into purchasing the products,” says the complaint.
“We set high quality, safety and performance standards for our products and are constantly evaluating the materials to ensure their continued safety and effectiveness,” said a Kimberly-Clark spokesperson. The company declined to comment on the ongoing litigation.
In the suit, Kimberly-Clark has been accused of violating a number of federal and state laws, involving false advertising, environmental marketing claims, breach of express warranty, and deceptive trade practices.
The complaint also alleges that the company's claims are “in contravention” of the Federal Trade Commission's (FTC) green guides, which “caution marketers not to make unqualified general environmental benefit claims”.
However, the guides are not enforceable and do not address 'natural' claims because the commission says it "lacks sufficient evidence on which to base general guidance”.
The suit seeks to represent a nationwide class of individuals, defined as anyone who purchased Huggies Natural Diapers or Natural Wipes.
Separately, a class action suit has been brought against Earth Friendly Products over its "natural" household cleaners, which plaintiffs say contain "non-natural" ingredients. Substances named by the plaintiffs include MIT, phenoxyethanol and potassium sorbate.
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US Agency to Launch E-filing Pilot Programme
Aug 20, 2015 | Chemical Watch
The US Consumer Products Safety Commission is to launch a pilot programme to test its proposed “e-filing” rule, which will amend existing laws covering how imported consumer products demonstrate compliance with US laws, including chemical regulations.
The pilot comes under an ongoing rulemaking to update CPSC certificate of compliance laws. These require importers to prepare documentation, showing that products have been tested to meet applicable regulations, and furnish them to the commission upon request.
In addition to the digital filing of all products' certificates of compliance, the pilot will test a proposed requirement for importers to enter data into a CPSC database, designed to assist the agency target “noncompliant products before they enter commerce and enforcing related requirements”.
The proposal would require importers to describe the consumer product safety rules that the product has been certified to meet, including applicable chemical safety laws, such as the avoidance of banned phthalates or adherence to maximum lead levels (CW 12 January 2015).
An earlier proposed rule was published in the Federal Register in 2013 but was suspended, pending the outcome of the e-filing pilot, says the Retail Industry Leaders Association, after "overwhelming opposition from retailers and other industry groups".
The pilot test will include up to nine participants and will run for six months, once it is operational, says the CPSC.
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Reid Sees Chance for Compromise on Oil Exports
Aug 20, 2015 | PoliticoPro
By Andrew Restuccia
Senate Minority Leader Harry Reid said he sees room for a compromise on the effort to lift the ban on U.S. crude oil exports, and he broke with President Barack Obama on Arctic drilling.
Reid, in an interview with POLITICO Wednesday, was careful not to choose a side in the fierce debate over ending the decades-old export ban, saying that both those in favor and those opposed to exporting U.S.-produced crude oil have made some compelling arguments.
He instead made the case that lawmakers “have to work out some sort of compromise” on the issue.
“We should sit down and work something out with those who are so focused on exporting it and those who are focused on not exporting it and come up with a deal,” he said.
Proponents of lifting the ban have argued it unfairly burdens the U.S. oil industry, which has suffered under the swooning oil prices in recent months, and is particularly unfair since Iran may soon resume its unrestricted oil sales if sanctions are lifted in the coming months.
But others argue that the U.S. is still reliant on importing millions of barrels of oil per day, and that selling the crude abroad could put U.S. drivers at risk of price hikes.
The oil industry’s campaign to lift the crude export ban put in place after the 1973 oil shock has gained momentum in recent months as top Republicans including House Speaker John Boehner have thrown their support behind it.
The House is expected to vote on a measure to lift the ban as soon as next month, and the Senate’s leading advocate of easing the crude export ban, Energy and Natural Resources Chairwoman Lisa Murkowski (R-Alaska), sent legislation on the issue to the floor last month after a party-line vote in the committee. That bill also included measures to increase offshore drilling in Alaska, the Gulf of Mexico and the Atlantic — provisions likely to draw Democratic opposition that would prevent its passage unless Reid moves to strike a deal on the exports issue.
So far, only a handful of Democrats in Congress have said publicly that they favored lifting the ban. In addition to Sens. Heidi Heitkamp and Joe Manchin, who have long supported allowing U.S. crude to be exported, Sen. Bob Menendez (R-N.J.) appeared to open the door to limited exports this week.
Reid also said he is opposed to Arctic oil drilling, echoing Hillary Clinton’s Tuesdaycomments on Twitter and separating himself from Obama, whose administration on Monday approved Shell’s plans to explore in the waters off the coast of Alaska.
“I have no idea how [Obama] came up with that. I don’t support that,” Reid said.
Asked if Obama made a political mistake in green-lighting Shell’s plans, Reid said, “I don’t think it’s a good thing for the world,” but he noted that the president doesn’t have to run for reelection.
Reid’s comments come just days before he is set to preside over his eight-annual National Clean Energy Summit in Las Vegas. Speakers at this year’s conference include Obama, Energy Secretary Ernest Moniz and Clinton campaign chairman John Podesta.
Reid has been one of Washington’s biggest backers of renewable energy and conservation for decades. The longtime senator traced his interest in the environment to a childhood trip from his small hometown of Searchlight, Nev., which has “basically no trees and certainly no grass,” to Piute Springs in nearby California.
“It was like a dream. I couldn’t believe this,” he said, describing the lush oasis with its running water and cavalry fort. “In my youthful mind, I remembered this so clearly. It was marked in stone in my brain.”
When he went back years later, he found the area had been neglected and ransacked by vandals.
“That’s where I started my interest in the environment because I said to myself, maybe someday I’ll be able to do something about that. And I have,” he said, repeating a story he often tells with pride. Reid later earmarked money to preserve the land.
Since then, Reid has been an outspoken advocate for protecting land, recently securing a national monument designation for the Basin and Range in Nevada. He has used his political clout to oppose the Yucca Mountain nuclear waste repository that was slated to be built in Nevada and has influenced the membership of both the Federal Energy Regulatory Commission and the Nuclear Regulatory Commission.
And he has fought to expand solar, wind and geothermal in the state. Former aides recalled the senator bringing a graphic to floor speeches declaring that a 100-square mile area of Nevada desert filled with solar panels could power the whole United States.
Reid was also a vocal cheerleader for a 2013 state bill, S.B. 123, that shifted Nevada away from coal.
“Everybody knows and understands that he was the movement force behind that,” said former FERC Chairman Jon Wellinghoff, a longtime Reid ally.
These days, Reid is quick to criticize Republicans for rejecting the scientific consensus that human activity is contributing to climate change. Asked if GOP climate skepticism is hurting the Republican brand, Reid quipped, “They don’t seem to worry about anything,” arguing that Republicans “could care less” about Hispanics, Asian Americans, women and African-Americans.
“What is their brand? I don’t know,” he said.
He acknowledged that Congress will need to pass climate legislation eventually to enable the country to address the issue, but said, “We need to get quite a few Republicans out of there first.”
Reid also underscored his opposition to the Keystone XL oil pipeline. But he wouldn’t say if Clinton should take a position on the issue. “She hasn’t asked me for much political advice,” he said.
“I think I’m right on it,” he continued. “I can’t believe it would be a good decision” for Clinton to support the pipeline.
As he approaches his retirement at the end of next year, Reid was reluctant to reflect on his environmental legacy.
“Somebody else can do that,” he said.
Elana Schor contributed to this story.
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With Mexican Crude Swaps, Obama Keeps Exports Debate at Arm's Length
Aug 20, 2015 | E&E - Energywire
By Jenny Mandel
Last week, on a quiet Friday in August, news leaked from the U.S. Department of Commerce that it had agreed to a number of crude oil swaps with Mexico, a relaxation of long-standing precedents against any such shipments.
The timing of the news, reported by several news outlets and attributed to unnamed department officials, suggests that the Obama administration is not ready to embrace the full public response to new crude oil exports, even as it explores the discretion it has under current law to authorize them.
Crude swaps could be similarly touchy within Mexico, where a long history of oil self-sufficiency has built up national pride around the issue. But the advantages to both sides have proved too good to pass up.
On the U.S. side, the story is now familiar: The shale gale brought a dramatic spike in production of light, sweet crude that surprised a refining industry tailored for heavy, sour grades. Refiners responded by backing out high-grade imports and tweaking their equipment to handle more of the domestic supply, but many facilities are approaching the upper limits of how much light, sweet oil they can take on without expensive reconfiguration. That's hurting domestic crude prices.
In Mexico, the story is quite different. Refineries there were configured for the sweet supplies that were dominant in the 1950s, '60s and '70s, but more recent production has been of heavier crudes.
Meanwhile, on the Mexican policy front, a sustained push to replace crude-derived heavy fuel oil with low-cost natural gas in electric generation has pared back demand for the dirtier energy source. But fuel oil is a low-value byproduct of refining heavy crude, especially in less sophisticated refineries, and the electric generation shift has hurt refiners' margins.
In an email, Petróleos Mexicanos (Pemex) confirmed that the newly authorized swap would produce "logistical synergies."
"Pemex has been notified of the approval of the application submitted to the ... U.S. Department of Commerce earlier this year for a proposed exchange of crude oil, in order to import up to 100 thousand barrels day of light crude and condensates, which will be highly beneficial for Mexico. This swap will allow Pemex to mix American light crude with domestic heavy oil and improve fuel production processes at refineries in Salamanca, Tula and Salina Cruz," the company said.
A recent assessment by Sandy Fielden, an analyst with consultancy RBN Energy, notes that Mexican crude exports to the United States have been falling at least since 2011, due partly to problems in Mexican oil production that have hurt production and partly to rising competition from Canada, whose oil sands supplies are served by improved pipeline access to U.S. Gulf Coast refineries.
Overall crude imports from Mexico have fallen from an average of 1.1 million barrels per day in 2011 to 780,000 barrels per day last year, and dropped to 701,000 barrels per day in the first five months of this year, according to RBN.
In an interview, Fielden said Mexican crude market share "is under attack in the U.S." from Canadian crude that flows to the coast in new pipelines.
He said a swap of Mexican heavy crude for light U.S. product is a "win-win" that locks in market share for Mexico while helping U.S. producers and midstream companies unload product.
Arguably, it's Canadian industry that loses out in the deal, which Fielden said amounts to a government-to-government arrangement. But he sees Canadians as unlikely to be upset.
"They're ahead in Canada, aren't they?" he said. "They don't have to do any swaps. Their access to the U.S. market is unfettered" under U.S. laws that require licenses but no reciprocation for exports to Canada. "The U.S. is exporting a lot less crude to Mexico than Canada."
Duncan Wood, director of the Mexico Institute at the Woodrow Wilson International Center for Scholars, underlined the importance of the deal for the Mexican state-controlled energy conglomerate. "Pemex has been looking for this particular type of light crude swap for a while," Wood said.
Political chatter has taken Pemex to task for poor performance and for not being able to keep up with demand for gasoline and other products, he said, noting that the country imports about 40 percent of the refined products it uses. "Mexican politicians have made a point of saying that for an oil-producing country, Mexico really should be able to produce a higher percent of its refined products," he noted.
Wood said Mexican refiners have already imported limited volumes of oil, where it's been needed for blending purposes to bring domestic heavy crudes up to technical benchmarks for export. "There have been limited crude imports into Mexico, but really only for the purpose of the refining mix. Obviously, Mexico produces a surplus of crude relative to use in the country," he added.
Wood said the ambitious energy reforms underway in Mexico, which include opening aspects of production and refining to international participation and investment, will reverse declining drilling outputs and bring new capital to the refining industry (EnergyWire, July 17).
Without those reforms, the country could have been a net oil importer by 2020 or 2030, under various analyses, Wood said. "It looks as though, because of the reform, the amount of oil produced in Mexico will rise," he added, predicting that production will grow by the end of this decade and increase by around 50 percent by 2030.
Wood said most of that new production will likely be heavy crude, pointing to an ongoing need for lighter blending stock. Tapping light sweet reserves, like those that likely extend south under the border from Texas, and reconfiguring refineries to make better use of heavier feedstock will both take time and money to bear fruit, he said.A path to freer trade?
Adriaán Lajous, a former CEO of Pemex who is now a fellow at Columbia University's Center on Global Energy Policy, wrote in a February study that crude oil swaps with Mexico should initially be started at low levels to test Mexican refineries' capabilities. Politically, he said, "This would be an important step forward from the traditional Mexican policy ban on crude oil imports."
But Lajous said in the longer term, the two countries should move toward freer oil trade.
"Swaps and exchanges are archaic and cumbersome commercial instruments," he wrote. "Straightforward bilateral sales can be structured more easily and their terms are more transparent. ... A successful [swap] transaction could be part of a piecemeal strategy that would gradually erode current restrictions."
RBN's Fielden sees it as unlikely that Mexico will be granted the same broad access to U.S. crude exports that Canada enjoys, which could be a logical next step in any such gradual erosion.
"I think it's pretty unlikely," Fielden said, "because that's just going to cause a debate about overturning the export ban itself, which is already lining up for next year anyway. ... It's very unlikely that [U.S. policymakers] would make that sort of concession to just one country. The only thing that's going to do is open up the broader debate. If you're going to do that, you may as well concede to end the export ban."
The Wilson Center's Wood agreed. "It's clear that the Mexican government would be interested in a more open, more free trade in oil products with the United States," he said. "I think that Mexico would very much like to have the same treatment as Canada," which would make sense in the context of strong U.S.-Mexican bilateral trade and the overall North American Free Trade Agreement framework.
"While I don't see that this will necessarily happen after these [swap] licences are awarded, I think that, long-term, that makes a lot of sense," he added. The debate over crude oil exports is very heavily politicized in the United States, he said, "but this is really a technical and trade issue. This is about helping out your neighbor."
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In Denver, Bipartisan Agreement that Ban Has 'Outlived its Usefulness'
Aug 20, 2015 | E&E - Energywire
By Jennifer Yachnin
Advocates for lifting the crude oil export ban gathered here yesterday to discuss their hopes of repealing the 1970s-era restrictions, offering a plethora of ideas about increasing public support from social media messaging to addressing the longtime concerns that the United States' oil supply could one day run dry.
The Colorado Association of Commerce and Industry and the Denver Metro Chamber of Commerce sponsored the afternoon discussion, moderated by Vital for Colorado CEO Peter Moore and featuring local chamber officials, including former Colorado state House Speaker Chuck Berry (R).
While the panel unanimously endorsed congressional efforts to repeal the export ban, the group varied widely in its recommendations of how to encourage greater public backing for bills now pending in the House and Senate.
"This ban, I think, has really outlived its usefulness. It was put in place in a very different era," said Janys Analytics Senior Adviser Chris Hansen, a Democrat campaigning for a Denver-based state House seat. "It was something to help protect the U.S. economy at that point, and now it's doing the opposite."
Hansen and other panel members also bucked criticisms leveled by Democratic lawmakers that repealing the ban could drive up gas prices and kill off U.S. jobs in the oil and gas refining sector.
"Our gasoline prices will go down if we're able to supply more of this light crude to the global market," Hansen said.
But he later acknowledged that such a message is often difficult to convey to consumers who lack intimate knowledge of the energy market: "This is complicated. The normal everyday Joe, the normal consumer, this is a pretty hard thing to unravel and unpack."
Colorado Farm Bureau Executive Vice President Chad Vorthmann suggested that energy industry supporters should compare oil exports to the sale of other U.S. commodities, such as wheat or corn.
"It would be absurd to think that because we export so much wheat, bread prices are too high," Vorthmann said, arguing that exporting goods helps to create market stability.
Tom Clark, executive vice president of the Denver Metro Chamber of Commerce, cautioned, however, that many consumers remain wary of warnings like those he recalled from the 1960s, 1970s and 1990s about whether the United States would someday run out of its own oil.
"I think it's PTSD. We've been so afraid of running out of oil for 40 years," said Clark, who also serves as the Metro Denver Economic Development Corp.'s CEO.
Berry, who serves as president of the Colorado Association of Commerce and Industry, also warned that proponents of oil exports face "extreme environmental groups" that would rather "rely exclusively on alternative sources" of energy.
"Some of the materials I read sounds like folks in the White House ... are in favor of lifting the ban. Whether a majority of the House and the Senate are in favor, I guess we'll find out. There may be some political challenges for folks who are afraid to offend these extreme environmental groups," Berry said.
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EPA Methane Proposal Could Shutter Small Drillers -- Analysts
Aug 20, 2015 | E&E - Energywire
The Obama administration's move to tighten federal methane regulations could be the final push toward closure for drillers that are already struggling in an environment of low oil and natural gas prices, according to Oppenheimer & Co. Inc.
U.S. EPA's proposed rules target potent methane emissions from oil wells, compressors and other equipment with the goal of reducing leakage by 40 to 45 percent by 2025 compared to 2012 levels (Greenwire, Aug. 18). Small drillers that can't afford to comply with the new regulations will likely have to shutter their operations, said Oppenheimer analyst Fadel Gheit.
"In a low oil and gas price environment, every penny counts," Gheit said. "For those companies that are very small," the costs will be overwhelming, he said.
Trade groups say the proposal unfairly imposes compliance expenses on an industry that has already made strides to reduce pollution.
"The last thing we need is more duplicative and costly regulation that could increase the cost of energy for Americans," said American Petroleum Institute President Jack Gerard in a statement (Bloomberg/Fuel Fix, Aug. 19). -- PK
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Enviros, Interior Negotiating Settlement in Offshore Fracking Case
Aug 20, 2015 | E&E - Energywire
By Ellen M. Gilmer
The Obama administration is in settlement talks with an environmental group that opposes offshore hydraulic fracturing in the Pacific Ocean.
According to court filings submitted this week, the Department of the Interior is negotiating a potential settlement with the California-based Environmental Defense Center over a lawsuit that asks the U.S. District Court for the Central District of California to block permitting of fracking off the coast of California.
EDC alleged in a December lawsuit that Interior's Bureau of Ocean Energy Management and Bureau of Safety and Environmental Enforcement have been rubber-stamping permits for fracking and acid well stimulation from offshore platforms in the Santa Barbara Channel, failing to complete full environmental review. The suit challenges 51 permits that were permitted through categorical exclusions under the National Environmental Policy Act, instead of more in-depth environmental impact statements (EnergyWire, Dec. 5, 2014).
The environmental group and agencies on Monday requested to delay some court deadlines to focus on reaching a settlement.
"Plaintiff and Federal Defendants have made significant progress in settlement negotiations that would result in a mutually-agreeable resolution to this litigation without the need for costly and protracted litigation," the filing said. "The Parties wish to focus their resources and energies on reaching settlement."
Judge Philip Gutierrez approved the delay yesterday.
The filing says the American Petroleum Institute and Exxon Mobil Corp., which have intervened in the lawsuit on Interior's side, have not yet been involved in settlement discussions but will be invited to join ongoing talks. The parties plan to update the court on their progress by Sept. 28.
The development in the EDC case comes a month after another environmental group notified the court of its own settlement discussions in a similar lawsuit. The Center for Biological Diversity and Interior last month told the same court that they were negotiating an agreement to end CBD's litigation over offshore fracking in the Pacific. The environmental law firm drafted an initial settlement offer in April, Interior countered in July, and the parties are still in talks (EnergyWire, July 29). An update for that case is also expected by Sept. 28.
Details of the proposed settlements have not been disclosed.
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Court Rejects Bid by EPA Foes to Retain Judges -- For Now
Aug 20, 2015 | E&E - Greenwire
By Jeremy P. Jacobs
A federal appeals court yesterday denied -- at least for now -- an effort by 15 states challenging U.S. EPA's landmark greenhouse gas standards for power plants to retain a conservative panel of judges for their latest lawsuit.
When the states filed their lawsuit against President Obama's Clean Power Plan last week, they included an "emergency motion" to consolidate the case with their previous, unsuccessful case at the U.S. Court of Appeals for the District of Columbia Circuit that sought to block EPA from finalizing the regulations (Greenwire, June 9).
The motivation for that motion: trying to retain the three-judge panel that heard the earlier case.
All three of those judges were appointed by Republican presidents, and one, Brett Kavanaugh, has a record of critical rulings against EPA regulations (Greenwire, Aug. 14).
But the D.C. Circuit wasted little time denying that motion, issuing an order less than a week after the states filed their motion and before EPA could respond to it.
However, the order does not rule out the possibility that the same three judges will preside over the new case.
The states and other challengers will undoubtedly make other requests for that panel after the regulations -- which aim to cut the power sector's carbon dioxide emissions by 32 percent from 2005 levels by 2030 -- are published in the Federal Register, the usual starting point for Clean Air Act litigation.
Separately, South Carolina filed a motion yesterday to join the case, bringing the number of states in the case to 16.
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EPA Regs Morphed from Inferior Option to 'Wicked Cool'
Aug 20, 2015 | E&E - Greenwire
By Robin Bravender
The Obama administration released big new climate rules this month with much fanfare, hailing them as "historic," an "incredible economic opportunity" and "wicked cool."
But not long ago, the administration expressed hope it would never have to write those regulations.
In the early days of Obama's presidency, when an economywide climate bill seemed possible on Capitol Hill, the administration's top environmental officials said U.S. EPA rules weren't the ideal route for tackling climate change.
Flash back to early 2009, when Obama's then-top climate official, Carol Browner, said, "The president continues to believe the best path forward is through legislation, rather than through sort of the weaving together the various authorities of the Clean Air Act."
Now, critics see it as problematic that regulations the administration once said it hoped to dodge completely are now being trumpeted by President Obama as important for safeguarding the planet and as "wicked cool" by EPA Administrator Gina McCarthy.
"EPA's current belief that the Clean Air Act fits the task of regulating greenhouse gases like a bespoke suit is completely inconsistent with the view the agency had just a few short years ago during the last congressional consideration of climate legislation," said Scott Segal, an industry lobbyist at Bracewell & Giuliani.
Members of the administration -- including former EPA Administrator Lisa Jackson -- "were clear on the point that the Clean Air Act was not the proper vehicle for regulating global greenhouse gases," Segal added.
Jackson, Obama's first-term EPA boss, said in 2009 that she "firmly" believed, "and the president has said all along, that new legislation is the best way to deal with climate change pollution." She also said she hoped Congress would make her agency's job of writing greenhouse gas rules "obsolete."
Many top government officials and some congressional backers of climate legislation hoped that the specter of looming EPA regulations (which the administration had triggered by declaring greenhouse gases a threat to public health and welfare) would help push a climate bill across the finish line.
It didn't.
Prospects for a climate bill crumbled in 2010, and the GOP gains in that year's congressional elections obliterated any chance that lawmakers would take another serious stab at greenhouse gas legislation for the remainder of Obama's term.
By then, EPA's hand was being forced by its 2009 "endangerment finding," a scientific determination that greenhouse gases threatened public health and welfare. That finding triggered a whole suite of Clean Air Act rules to rein in greenhouse gases.'Clean Air Act as a threat'
Now, as the administration is rolling out those rules, officials are extolling their virtues.
At the official White House unveiling of the final power plant rule earlier this month, Obama called the effort "the single most important step America has ever taken in the fight against global climate change."
The administration's new rhetoric "shows the hollowness of what they were saying back in 2009 and 2010," said a former GOP Senate staffer who is now an industry lobbyist. "Clearly, they were using the Clean Air Act as a threat and as a club."
Some critics of EPA regulations say the administration should have been -- and still should be -- wary about using the Clean Air Act to tackle climate change.
Bracewell & Giuliani's Segal called the Clean Air Act "cumbersome and ill-suited to the task" of regulating greenhouse gases.
"I believe EPA's earlier doubts about whether the Clean Air Act supports this amount of reductions were absolutely legitimate," said Joe Stanko, an attorney at Hunton & Williams who represents industry groups. He called EPA's new rule to crack down on power plants' greenhouse gas emissions "very, very suspect legally."
Former EPA officials say there's no disconnect -- the administration has merely evolved as it has tackled writing those new rules.
"Back in the early days of 2009, we really didn't know what it would take to implement the Clean Air Act because it hadn't really been done," said Robert Sussman, who was a top adviser to Jackson at EPA. "So the agency learned a lot during the first Obama term about implementing the Clean Air Act."
The experience gained from writing those rules "made people a lot more confident than they were at the start," Sussman added.'It's good enough'
Administration officials have said all along that the EPA rules were an important backstop if Congress failed to take action.
In early 2010, after the House had passed a climate bill, Jackson told members of Congress, "EPA can use the Clean Air Act to make smart, sensible regulation that's entirely consistent with the idea of long-term legislation, which is where I would love to see our country and the Senate go."
And current and former officials still say they would prefer a legislative fix, but that EPA rules can help in the meantime.
"The president has always told Congress that they're free to take action on this; in fact, we would help them if they want to do it," McCarthy told PBS talk show host Charlie Rose this month. "The president had to use the authority that his administration has, and the Clean Air Act isn't a tax policy; the Clean Air Act is a pollution reduction strategy, and that's what we're going to get."
Bob Perciasepe, who was EPA's deputy administrator from 2009 until last year, said in an interview that, ultimately, "we're going to need an economywide, market-based approach for the country." That solution doesn't mean "that we can just keep going on the Clean Air Act to every different part of the economy and not have some connecting tissue to make it efficient," he added.
But since an economywide approach isn't likely to be available anytime soon, Perciasepe said, tackling industry sectors like automobiles and power plants under the Clean Air Act "can make some substantial gains in the near term that won't be incompatible with the long term."
Are the EPA rules as good as legislation might be? "Probably not," Sussman said. "But is it good enough, given the imperative of climate change and given the president's commitment to taking action? Yeah, it's good enough, and it will work."
Even Browner -- who said not long ago that the administration saw legislation as the "best path" -- is now a fan of the rules EPA has issued. In a recent interview, she called the new power plant rule "one of the best regulations I've ever seen."
Browner, who was EPA's boss during the Clinton administration, said legislation would still be preferable "in a perfect world." But, she added, "I don't think we live in the perfect world." If Congress were to put a cap on carbon, "That would be great," she said. "But meanwhile, we've got a crisis, and we need to be responding."
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