ACC AM 9/15

Industry and Association News

1. (ACC Mentioned) SPE ACCE 2015 show report

   Sep 14, 2015 | Composites World

   By Sarah Black and Heather Caliendo
   
   
   The Society of Plastics Engineers (SPE) Composites Division organized the 15th edition of the Automotive Composites Conference and Exhibition (ACCE), and as in every year, it was the largest event so far.

Chemical Management News

2. Congress Races to Stay Ahead of Synthetic-Drug Problem

   Sep 15, 2015 | National Journal

   By Rachel Roubein
   
   
   The use of syn­thet­ic marijuana ap­pears to be rising nearly as quickly as the drugs them­selves are chan­ging. And that makes it hard for Con­gress to keep up.
3. Bellwether Complaint Filed in Lumber Liquidators Cases

   Sep 14, 2015 | BNA Daily Environment Report

   By Steven M. Sellers
   
   
   A proposed class action led by 13 homeowners from five states will serve as a bellwether for the scores of suits filed against Lumber Liquidators Inc. over excess formaldehyde in the company's Chinese-made flooring products, according to a Sept. 11 filing in the Eastern District of Virginia
4. ECHA Highlights Biocide Notification Cutoff Date

   Sep 14, 2015 | BNA Daily Environment Report

   By Stephen Gardner
   
   
   Companies have until Oct. 30 to submit a notification if they want to continue to use in the European Union certain substances in some biocidal products, the European Chemicals Agency (ECHA) said Sept. 14.

Chemical Security News

5. PHMSA Finds Probable Violations by Plains Pipeline

   Sep 14, 2015 | BNA Daily Environment Report

   The company whose Santa Barbara County, Calif., pipeline spilled more than 100,000 gallons of crude oil in May likely violated several pipeline safety laws in Bakersfield, Calif., prior to that incident, according to the nation's pipeline regulator.
6. Mccarthy To Be Called On The Carpet Over Mine Waste Spill

   Sep 14, 2015 | Politico

   By Eric Wolff
   
   
   EPA Administrator Gina McCarthy will probably see lawmakers in her sleep by the time this week is over. Four separate Congressional committees have summoned her to the woodshed to explain her agency's role in the Gold King Mine spill that dumped 3 million gallons of mine waste into the Animus River.
7. EPA: Former Chemical Site Owners Agree To Cleanup Plan

   Sep 14, 2015 | Associated Press (In Washington Post)

   The Environmental Protection Agency says former owners of a site once used to handle and store chemicals have agreed to reduce chemical contamination and control leakage of hazardous materials into groundwater.
8. McCarthy in Hot Seat Over Colo. Spill

   Sep 15, 2015 | E&E Daily

   By Manuel Quiñones
   
   
   U.S. EPA Administrator Gina McCarthy will face deep scrutiny on Capitol Hill this week over the agency's handling of an abandoned-mine spill in Colorado last month.
9. Senate Field Hearing Focuses On Oversight Agency, Mont. Spill

   Sep 15, 2015 | E&E Daily

   By Hannah Northey
   
   
   A Senate Commerce subcommittee will discuss the summer oil spill in the Yellowstone River and the pipeline regulator during a field hearing Friday in Billings, Mont.

Energy and Environment News

10. U.S. Shale’s Looking Bleaker, Says Ex-Aramco Oilman

    Sep 14, 2015 | Blog Wall Street Journal

    By Kevin Baxter
    
    
    U.S. oil production could sink to as low as 8.4 million barrels a day as beleaguered shale producers continue to get battered by low prices, according to the former head of exploration and production of the Saudi Arabian Oil Company (Saudi Aramco).
11. Panel to review well control rule at field hearing in La.

    Sep 15, 2015 | E&E Daily

    By Daniel Bush
    
    
    The House Natural Resources Committee is holding a field hearing in Louisiana this morning to review the impacts of federal regulations on offshore oil and gas drilling in the Gulf of Mexico.
12. Barton Seeks 'Sweet Spot' On Crude Exports

    Sep 15, 2015 | E&E Daily

    By Geof Koss, Daniel Bush and Hannah Northey
    
    
    The House Republican leading efforts to repeal the ban on crude oil exports is talking with Democrats to find "middle ground" that would boost the bill's overall support when it comes to the floor in the coming weeks.
13. Oil Patch Braces for Financial Reckoning

    Sep 14, 2015 | http://www.wsj.com/articles/oil-patch-braces-for-financial-reckoning-1442274651

    By Daniel Gilbert, Erin Ailworth and Alison Sider
    
    
    U.S. energy companies have defied financial gravity for more than a year, borrowing and spending billions of dollars to pump oil, even as crude prices plummeted. Until now.
14. EPA Revises Aluminum Facility Emissions Standards

    Sep 14, 2015 | BNA Daily Environment Report

    By Patrick Ambrosio
    
    
    Primary aluminum reduction plants will be required to control previously unregulated emissions of polycyclic organic matter under revised national emissions standards set by the Environmental Protection Agency.
15. Rebuttal: The Case For EPA’s Proposed Methane Regulations Is Just Common Sense

    Sep 14, 2015 | BNA Daily Environment Report

    By Mark Brownstein
    
    
    On the Congress blog last week, Katie Brown argued against the Environmental Protection Agency’s proposed new rules to reduce the 7 million tons of methane emissions released by the oil and gas industry each year.
16. Adviser: States Need to Start Work on Clean Power Plans

    Sep 14, 2015 | BNA Daily Environment Report

    By Carolyn Whetzel
    
    
    The Environmental Protection Agency's Clean Power Plan offers states a lot of flexibility, so developing compliant plans will not be difficult, an adviser at the Regulatory Assistance Project said Sept. 14.
17. E&E Hub Gets Updates As States Weigh Options

    Sep 14, 2015 | E&E News PM

    By Emily Holden and Rod Kuckro
    
    
    As reticent states weigh whether to write compliance plans or challenge U.S. EPA's Clean Power Plan in court, E&E staff have been updating the Power Plan Hub with interviews with regulators, agency officials, and environment and business interests.
18. Court Clears Duke Energy Plan to Clean More Coal-Ash Pits

    Sep 14, 2015 | Associated Press (In New York Times)

    A judge on Monday rejected a bid by North Carolina's environment agency to block Duke Energy from removing toxic coal ash from more plants than required under a new state law.
19. House Set to Pass Gas Turbine, Natural Disaster, Land Bills

    Sep 15, 2015 | E&E Daily

    By Katherine Ling
    
    
    A bill that could aid states and utilities in meeting U.S. EPA's Clean Power Plan is scheduled for a vote tomorrow in the House, along with other legislation focused on natural disasters and public lands.
20. Gov. Brown to Push Climate Policies With Regulation

    Sep 14, 2015 | BNA Daily Environment Report

    By Mark Chediak and James Nash
    
    
    Gov. Jerry Brown (D)'s dreams of cutting California's gasoline use in half and imposing a stricter limit on greenhouse-gas emissions may have died on the legislative floor last week. But they live on elsewhere.
21. House Republicans Plan to Call for Action on Climate Change

    Sep 15, 2015 | National Journal

    By Clare Foran
    
    
    A co­ali­tion of House Re­pub­lic­ans is gear­ing up to make waves by call­ing for ac­tion to fight cli­mate change on the eve of Pope Fran­cis’s vis­it to Cap­it­ol Hill.
22. California Bill to Boost Renewables Goes to Governor

    Sep 14, 2015 | BNA Daily Environment Report

    By James Nash
    
    
    Solar- and wind-power entrepreneurs will get a bigger share of California's energy market. Construction contractors will get more work tightening the energy efficiency of buildings. And environmentalists will tiptoe closer to their goal of weaning the most-populous U.S. state from fossil fuels.
23. California Legislature Approves Climate Bill

    Sep 14, 2015 | BNA Daily Environment Report

    By Devin Henry
    
    
    California lawmakers approved a major statewide renewable energy goal as their legislative session ground to a close last week.
24. U.S. and Chinese Cities Pledge Reductions Ahead Of Paris

    Sep 15, 2015 | E&E Daily

    By Jean Chemnick
    
    
    U.S. and Chinese cities and states announced new pledges and partnerships today aimed at building momentum toward a high-stakes round of U.N. climate talks in Paris at the end of this year.
25. U.S. and Chinese Climate Change Negotiators to Meet in Los Angeles

    Sep 15, 2015 | The New York Times

    By Coral Davenport
    
    
    President Obama’s top climate change negotiator will meet with his Chinese counterpart in Los Angeles on Tuesday to announce joint actions by cities, states and provinces in both countries to reduce greenhouse gas emissions.
26. EPA Floats Enforcement Priorities for FY 2017-2019

    Sep 14, 2015 | BNA Daily Environment Report

    By Renee Schoof
    
    
    The Environmental Protection Agency has proposed its national enforcement priorities for fiscal years 2017-19, including some new initiatives focusing on air toxics and industrial water pollution, according to a notice scheduled for publication Sept. 15.
27. Let’s Cut All Energy Subsidies and Start Taxing Pollution

    Sep 15, 2015 | http://blogs.wsj.com/experts/2015/09/15/lets-cut-all-energy-subsidies-and-start-taxing-pollution/

    By Richard Revesz
    
    
    Energy subsidies have become a hot topic on the presidential campaign trail. Jeb Bush recently called for an end to all subsidies–those that support fossil fuels as well as those aiding renewable energy.
28. 'Smart Cities' Program Targets Congestion, Climate Change

    Sep 14, 2015 | E&E News PM

    By Robin Bravender
    
    
    The Obama administration today proposed to invest more than $160 million in programs aimed at tackling climate change, reducing traffic congestion and other local efforts.

Transportation News

29. Railroad Administration Reopens Risk Rule Comment Period

    Sep 14, 2015 | BNA Daily Environment Report

    The Federal Railroad Administration will again accept comments on its risk reduction proposed rule–this time for three days only.

Full Text of Stories Below

Industry and Association News

1. (ACC Mentioned) SPE ACCE 2015 show report

   Sep 14, 2015 | Composites World

   By Sarah Black and Heather Caliendo

   The Society of Plastics Engineers (SPE) Composites Division organized the 15th edition of the Automotive Composites Conference and Exhibition (ACCE), and as in every year, it was the largest event so far. That speaks not only to the fact that event organizers, including CW contributors Peggy Malnati and event co-chair Dale Brosius, did a great job, but also to the auto industry’s ever-growing interest in composite materials. Was this the year, finally, for the big break-through for automotive composites? Maybe, depending on to whom one talked or the presentation one heard. But, a BMW i8 with carbon composite Life Module was prominently on display in the parts area, along with some other interesting and actual in-production composite parts. That’s pretty firm proof of the distance the event has traveled over the past decade and a half.

   After a welcome by Brosius and co-chair Fred Deans, chief marketing officer at Allied Composite Technologies LLC (Rochester Hills, MI, US) that included best paper awards and student scholarship winners, Russ Broome, managing director for SPE US, accepted $20,000 from SPE’s automotive division and composites division ($10,000 each) for the Dr. Jackie Rehkopf scholarship, administered by the SPE Foundation. Broom noted that his goal is to begin providing scholarships at the high school level: “We need to get kids interested in plastics and composites earlier, so that they’re prepared to enter polymer programs when they’re ready for university.”

   Three simultaneous tracks over three days provided conference-goers with a wealth of technical learning opportunities, with an emphasis on ways to improve parts and production speeds while reducing costs. A three-part Nanocomposites track included several papers on nanocellulose, available as cellulose nanofibrils (CNFs) and cellulose nanocrystals (CNCs) and ways to use them in biocomposites. These bio-based materials, generated from a broad range of both trees and agricultural biomass, are abundant, price-stable, have relatively high strength and modulus, are optically transparent, provide a permeation barrier to oxygen (because of the tortuous path created by the fibrils), a high strength-to-density ratio (higher than carbon fiber), and a lower density than most traditional resins fillers such as talc or calcium carbonate, says Kim Nelson, vice president of nanocellulose technology at American Process Inc. (Atlanta, GA,US). While CNFs and CNCs are not new, her company has a way of producing them in larger quantities, at a lower cost and with greater stability. The nanocellulose can be functionalized and compatibilized for specific resins, and made either hydrophilic or hydrophobic for specific applications. She notes that American Process CNCs and CNFs are able to withstand temperatures 50-100°C higher than other nanocellulose on the market. The bottom line is that nanocellulose filler can improve resin performance in many applications, including plastics and composites molding. The company is working with Futuris Group (Port Melbourne, Australia), a provider of seat components for Tesla cars, and with Oak Ridge National Laboratory (ORNL, Knoxville, TN, US) on improving 3D printing resins.

   Also in the nanocomposite track, Kunal Kumar, senior technical service representative from Evonik Corp.’s (Richmond, VA, US) Richmond Business and Innovation Center, spoke about his company’s nanosilica solution for tougher resins. Nanopox, at 20 nm in diameter, is intended for addition into fiber sizing formulations, at very low concentrations (less than 2% by weight). The silica particles improve compression strength, lower coefficient of thermal expansion (CTE), have no influence on the resin’s Tg, and are a cost-effective way to toughen automotive parts that must be damage tolerant. At the other end of the nanosilica spectrum, 3M’s (St. Paul, MN, US) James Nelson described how his company adds nanosilica at loading up to 55% weight percent into resins, for applications like filament winding of pressure vessels or drive shafts. Based on extensive testing, Nelson says the particles improve virtually every characteristic of its 3M 4833 matrix resin, including less shrinkage, lower exotherm, better mechanical properties, with higher density being the only drawback.

   The session track “Opportunities and Challenges with Carbon Composites” offered up some new information, including Michael Karcher’s description of an experimental program at Fraunhofer ICT for producing carbon prepreg materials inline, and in-house, for greater cost efficiency and higher production rates. Max Thouin, technical sales manager for Mitsubishi Rayon Carbon Fiber & Composites Inc. (Irvine, CA, US) gave an interesting presentation on automation of preforming for compression molding, using 2D layup of towpregs, rather than slit tape. The towpreg is able to move and shear easily for better conformability during part shaping, and scrap can be significantly reduced, making the process much more cost effective. Thouin emphasized the importance of creating a lower-risk and more robust composites processing supply chain as the key to getting more traction in the automotive sector.

   Brian Gardner of Sigmatex (Benecia, CA, US and Runcorn, UK) described SigmaRF made with recycled carbon fiber waste from his own company’s product lines. The fibers are realigned, comingled with polypropylene or polyamide matrix fibers, then rewoven to form a fabric. Because the fibers aren’t continuous, the fabric is essentially a stretch-broken type, with good drapability and conformity to a mold surface. Gardner claims that a Class A finish is possible with the materials, in a sub-four-minute process, using PA6,6 resin, retaining 85% of virgin fiber modulus and 50% of virgin tensile strength, and exhibiting better impact properties and damage tolerance than a continuous fiber product — at significantly less cost. Sigmatex is open to accepting customers’ waste carbon streams, he added.

   In the same carbon fiber track, Hexion’s (Columbus, OH, US) Stephen Greydanus gave an overview of the current state of automotive composites, based on industry presentations, available studies as well as his company’s involvement. He presented a very interesting slide of BMW’s new 7-Series Carbon Core concept, which places braided carbon/epoxy structural elements inside the B and C pillars, roof bows and chassis elements to form a strong structural cage around the occupants, a design that drops about 41 kg from the body-in-white. While noting that part size and complexity, mold temperature and specific equipment determine the material processing window, Greydanus says that a part with simple geometry, in a liquid compression process, can be made in as little as 50 seconds with the company’s resin materials (and preform binders).

   Natural fiber composites were discussed at length. National Research Council Canada and University of Guelph were representatives, as were material suppliers to this growing market segment. BASF’s (Ludwigshafen, Germany) gave a dynamic presentation about his company’s Acrodur binder system, essentially a water-based acrylic dispersion to bind natural fibers together. In addition to thermoset versions, he discussed a new thermoplastic version (Acrodur Power 2750 and 4444, introduced at the 2015 JEC Europe event) that now allows both cold-pressing and hot-pressing for auto interior components, as well as back injection molding. His story: the product can replace polypropylene in an interior part, for lower weight (since less binder is needed, as compared to PP); it results in a higher fiber volume fraction (for better structural performance); and the system gives the ability to add pigments or fire performance fillers to a natural fiber part (since the Acrodur binder is an easily-modified liquid). Another standout was Atul Bali of Competitive Green Technologies (Leamington, Ontario, Canada) who discussed his company’s success at commercializing a variety of bio-based composites, initially developed at Guelph. BIOBLAKR is one example; it is a bio-sourced alternative to carbon black, with a significantly lower density than the traditional carbon product, and is able to take very high in-service temperatures.

   Some other standout presentations included one by Pinette Emidicau’s (Troy, MI, US and Chalon Sur Saone, France) Andrew Rypkema, who discussed the “QSP – Quilted Stratum Process” for automated preforming. The innovative automated line will be unveiled November 3 at the Technocampus in Nantes, France.  Another was a paper by the American Chemistry Council’s Michael Day and Michigan State University’s Dr. Mahmood Haq, who described research on reversible bonded joints using nano-ferromagnetic particles.

   This was the first year for SPE ACCE to host a technical session dedicated to additive manufacturing and 3D printing. Ellen Lee, materials and manufacturing research for Ford (Dearborn, MI, US), said that while additive manufacturing isn’t new for the automaker (almost 30 years of experience), the company is focused on going beyond the prototype level to the direct production of end use, functional parts. But Lee said that of the main challenges of additive manufacturing for automotive is limited materials as many materials currently available are not suitable for automotive applications. “The future direction for us is materials development and understanding how we can customize them,” she said. Ford is also pushing for multi-material printing in a single step. “It’s nice to see automotive embrace additive manufacturing, since our requirements are more unique than medical and aerospace,” she said. “We believe additive manufacturing will significantly impact automotive manufacturing and Ford wants to be involved and also help direct where it goes.”

   All of the papers and presentations described here are freely available on SPE’s Web site, athttp://speautomotive.com/SPE_CD/SPEA2015/about.htm . Archived papers from previous years can be obtained at http://speautomotive.com/aca.

   The keynoter lineup was impressive as well. Ford’s Dr. Deborah Mielewski, senior technical leader for plastics and materials sustainability in Ford’s Materials and Manufacturing Research Dept. (Dearborn, MI, US), is passionate about sustainable manufacturing, and using renewable materials in auto manufacturing. She quipped that her 29 years at Ford feels “like 29 minutes” because she’s enjoyed it so much. She pointed out the challenges of incorporating natural fiber/renewables in automobiles: appearance, survivability in the harsh environment of a car interior, their compatibility (or lack thereof) with polymers, sensitivity to humidity and moisture, degradation during manufacturing and the lack of infrastructure around recyclate streams —making them costly and often hard to obtain. She cited several success stories, including making a soy foam for use in Ford car seat cushions and backs, as well as head rests and headliners. Her group is working with Weyerhauser on an injection-molded cellulose-reinforced center console part for the Lincoln MKX, and has renewable parts on the Ford F150 and Ford Escape. Do sustainable materials sell cars? Probably not, yet, she says, but “We’re protecting the business for future unknowns, and collecting material choices,” pointing out that the next generation of car buyers are very serious about sustainable consumer choices.

   BMW’s Stefan Stanglmaier spoke about his company’s production of the i3 and i8 cars, using RTM for “higher geometry” parts together with wet compression molding for simpler part shapes. His principal point was that part cost must come down. To accomplish that, better material efficiency (less waste) is a necessity, and that can be accomplished with more tailored designs, with local reinforcements.

   On Jan. 9, the US Department of Energy (DoE) created quite the stir when it announced that it will add $70 million to the $189 million already committed to the University of Tennessee’s Institute for Advanced Composites Manufacturing Innovation (IACMI) for composites R&D. During SPE ACCE, Craig Blue, CEO of IACMI, emphasized that IACMI is a “goal-focused” institute and listed off its five year technical goals, which includes: 25% lower carbon fiber reinforced polymer (CFRP) cost; 50% reduction in CFRP embodied energy; and a 50% reduction in CFRP embodied energy. Lightweighting was a key topic throughout the presentation and Larry Drzal, IACMI director and director of vehicles technology area at Michigan State University, said that CFRP composites have the greatest weight reduction potential if cost and manufacturing issues can be solved. He took a closer look at IACMI’s technical goals and how it will be achieved. Beyond having a knowledgeable and dedicated professional staff, he said it is important to have an integration of participant teams in the vehicle supply chain (OEM, Tier 1, material suppliers, SME). Another key element: access to facilities for proprietary projects to help move processes forward.

   The event’s big panel discussion, moderated by Jan-Anders Månson, a composites entrepreneur and a professor at Ecole Polytechnique Fédérale de Lausanne (EPFL), was as always insightful. Panelists included Dr. Paul Krajewski, director of GM’s Vehicle Systems Research Laboratory; Glade Gunther of Cytec Industrial Material’s (Heanor, Derbyshire, UK) automotive sector; Rainer Kossak of Novelis Inc. (xx, xx, US), an aluminum supplier to Detroit OEMs; Peter Ulintz of the Precision Metalforming Assn. (PMA, Independence, OH, US); Paul Thom of Schuler Inc. (Canton, MI, US); and Hannes Fuchs of Multimatic (Markham, Ontario, Canada), a well-known Tier 1 supplier of both metal and composites — Fuchs is the company’s principal engineer for composites. Månson started the discussion by cautioning the panelists to avoid any one-upsmanship and to focus on the car of the future that meets the upcoming CAFÉ standards: will it be a multi-material approach, or will composites be localized on special models, driven by car size? A few nuggets came out of the lengthy discussion: Gunther made the point that OEMs want a solution that works, and they really don’t care what the material is, as long as the supply chain is there, together with process knowledge on the shop floor. Fuchs commented that OEMs want functionality for the price, and that it’s a matter of working composites into the “high-volume” mindset of the auto industry. The highlight was a discussion of the huge investment represented by presses and machines, and that it might be possible to actually convert steel stamping presses to mold fast-cure composite parts, or to produce presses that are dual use, for metal and for composites. Again, Fuchs noted that there’s “a complete synergy” between metals and composites; yes, a steel part can be stamped in 4 seconds, but a composite part can now be made in 50 seconds, and that composite part represents part consolidation, co-molded fasteners, or other functions that justify that time differential.

   The final keynote was delivered by long-time auto composites expert Antony Dodworth, managing director of Bright Light Structures (Peterborough, UK). He described Zenos E10 sports car that his company is involved with, focusing on the chassis tub. The tub is a complex honeycomb-cored structure with carbon face sheets that come from recycled carbon fabric off-cuts and trim waste. Each of the five elements of the tub incorporates intricate deep draws and shapes, made with Huntsman’s Victrox polyurethane resin and an extruded plastic honeycomb devised by Bright Light, with circular, rather than hexagonal cells, which can be cut to any thickness. The tub elements reportedly are quickly layed in the mold, then sprayed with the resin, then thermoformed in a one-shot sub-15 minute cycle. The unique core crushes under pressure, but still maintains adequate performance, says Dodworth. The five pieces are adhesively bonded together, and to a central “spine” made of an aluminum extrusion that helps anchor the mid-positioned engine and forms the attachment point for many other car systems. The relatively inexpensive sports car is popular in the UK, particularly with racing enthusiasts, and about 12 cars are made per month.

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Chemical Management News

2. Congress Races to Stay Ahead of Synthetic-Drug Problem

   Sep 15, 2015 | National Journal

   By Rachel Roubein

   The use of syn­thet­ic marijuana ap­pears to be rising nearly as quickly as the drugs them­selves are chan­ging. And that makes it hard for Con­gress to keep up.

   With some drug pack­ets labeled “not in­ten­ded for hu­man con­sump­tion” in an ap­par­ent ef­fort to skirt the law, reg­u­la­tion and pro­sec­u­tion re­main tricky as chem­ists al­ter the de­sign­er drug’s mo­lecu­lar struc­ture faster than the fed­er­al gov­ern­ment can re­act. After a sub­stan­tial shift down­ward from 2011, the num­ber of calls to pois­on cen­ters for ex­pos­ure to syn­thet­ic marijuana has ris­en dra­mat­ic­ally this year. With 5,932 calls as of Sunday, this year is on pace to break 2011’s re­cord of 6,968, the Amer­ic­an As­so­ci­ation of Pois­on Con­trol Cen­ters re­ports. (Though they’ve got­ten sig­ni­fic­ant me­dia at­ten­tion, the us­age of bath salts has not ris­en.)

   “These drugs are com­ing out so fast some­times that it’s im­possible al­most to keep up with what’s out, what do they look like chem­ic­ally, struc­tur­ally, what are they re­lated to, what fam­ily do they be­long to, all of that sci­entif­ic stuff,” said Heath­er Gray, the Na­tion­al Al­li­ance for Mod­el State Drug Laws le­gis­lat­ive dir­ect­or.

   At­tempts at cur­tail­ing syn­thet­ic drugs take some cre­ativ­ity: Po­lice can sus­pend a shop­keep­er’s li­quor and to­bacco li­censes if they’re caught selling de­sign­er drugs in DeKalb, Illinois. Stores that sell may have their build­ing de­clared a pub­lic nuis­ance in Ten­ness­ee. And busi­ness li­censes could be for­feited in Illinois, ac­cord­ing to a Na­tion­al Al­li­ance for Mod­el State Drug Laws re­port titled “En­force­ment of Syn­thet­ic Sub­stances Laws.”

   But while many of these crimes oc­cur at the state and loc­al level, sev­er­al mem­bers of Con­gress are hop­ing to close loop­holes, aim­ing to make it easi­er to pro­sec­ute and to place drugs on fed­er­ally banned lists.

   Be­fore 2010, syn­thet­ic can­nabin­oids—which are chem­ic­ally laced sub­stances de­signed to im­it­ate marijuana—wer­en’t con­trolled at the state or fed­er­al level, ac­cord­ing to the White House’s Of­fice of Na­tion­al Drug Con­trol Policy. In 2012, a por­tion of the Food and Drug Ad­min­is­tra­tion Safety and In­nov­a­tion Act per­man­ently placed 26 types of syn­thet­ic can­nabin­oids and bath salts in­to Sched­ule I of the Con­trolled Sub­stances Act—of­fi­cially put­ting some of the de­sign­er drugs in the same cat­egory as heroin, marijuana, and ec­stasy. And, since then, most states have passed their own laws.

   “There’s an in­fin­ite ar­ray of pos­sib­il­it­ies that these chem­ists in these shady labor­at­or­ies can come up with,” said Ruben Baler, a health sci­ent­ist at the Na­tion­al In­sti­tute on Drug Ab­use’s sci­ence policy branch, who be­lieves that edu­cat­ing the com­munity and chil­dren about syn­thet­ics is the key. He ad­ded: “It’s a nev­er-end­ing story. It’s the cat chas­ing its tail, so this is the chal­lenge, really, from a reg­u­lat­ory point of view.”

   A bill in­tro­duced by GOP Sen. Rob Port­man of Ohio and Demo­crat­ic Sen. Di­anne Fein­stein of Cali­for­nia aims to speed up the pro­cess of mak­ing these drugs il­leg­al through the cre­ation of an in­ter­agency com­mit­tee headed by the Drug En­force­ment Ad­min­is­tra­tion. The goal: With­in about 90 days, the com­mit­tee could des­ig­nate drugs sim­il­ar chem­ic­ally—or with a sim­il­ar pre­dict­ive ef­fect—as a con­trolled sub­stance ana­logue, thus mak­ing them il­leg­al. Ac­cord­ing to Gray, this tac­tic would “greatly re­duce the amount of time needed to sched­ule a sub­stance.”

   The bill would also make it il­leg­al to im­port the sub­stances on that list, un­less the at­tor­ney gen­er­al says oth­er­wise.

   Yet in Elkhart County, In­di­ana, where Curtis Hill serves as a pro­sec­ut­ing at­tor­ney, the sub­stances seem­ingly change overnight. So, Hill said, without some type of catchall pro­gram, con­stant up­dates would be needed to con­tinu­ally add new chem­ic­al con­coc­tions to the list. “By the time you get the sub­stances, break it down, de­term­ine what it is, it’s very likely that sub­stance will have morph­ed in­to something else.”

   An­oth­er bill—in­tro­duced in the House by Rep. Mac Thorn­berry, with a com­pan­ion in the Sen­ate—would com­bat an­oth­er is­sue: man­u­fac­tur­ers la­beling syn­thet­ic-drug pack­ets with the words “not in­ten­ded for hu­man con­sump­tion.” A 2014 Con­gres­sion­al Re­search Ser­vice re­port noted that “one pos­sible bar­ri­er for pro­sec­ut­ing in­di­vidu­als for vi­ol­a­tions re­la­tion to syn­thet­ic sub­stances such as ‘bath salts’ that are mar­keted as ‘not in­ten­ded for hu­man con­sump­tion’ may be prov­ing that des­pite this la­beling, these sub­stances are in­deed in­ten­ded for con­sump­tion.”

   “Put­ting on the la­bel ‘not for hu­man con­sump­tion’ is not a get-out-of-jail-free card,” Thorn­berry told Na­tion­al Journ­al. “You’ve got to look at the total cir­cum­stances. If you know that it’s be­ing used for hu­man con­sump­tion, if you’re selling it to a bunch of kids who line up out­side your store, then you can still be held re­spons­ible for it.”

   Ac­cord­ing to Gray, pro­sec­utors can try to use vari­ous tools to prove a sub­stance was in­ten­ded for hu­man use, in­clud­ing wit­ness testi­mony, how it’s ad­vert­ised, and what oth­ers have said about it.

   In 2013, Jesse High, 18, died after us­ing syn­thet­ic marijuana in Thorn­berry’s Texas home dis­trict, sev­er­al news out­lets re­por­ted. Af­ter­ward, the con­gress­man began talk­ing to his com­munity, learn­ing just how rampant the de­sign­er drugs were in the re­gion. It’s an ef­fort he’s con­tin­ued, stay­ing in­formed on the drug through law en­force­ment, pub­lic health of­fi­cials, and oth­er loc­al stake­hold­ers.

   And dur­ing Au­gust re­cess, Thorn­berry sat at a po­lice de­part­ment’s train­ing cen­ter sur­roun­ded by law en­force­ment, health of­fi­cials, and oth­ers grap­pling with the is­sue of syn­thet­ic drugs in his home dis­trict. It was an­oth­er roundtable, an­oth­er dis­cus­sion about a prob­lem that just won’t seem to go away.

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3. Bellwether Complaint Filed in Lumber Liquidators Cases

   Sep 14, 2015 | BNA Daily Environment Report

   By Steven M. Sellers

   A proposed class action led by 13 homeowners from five states will serve as a bellwether for the scores of suits filed against Lumber Liquidators Inc. over excess formaldehyde in the company's Chinese-made flooring products, according to a Sept. 11 filing in the Eastern District of Virginia (In re Lumber Liquidators Chinese-Manufactured Flooring Prods. Mktg., Sales Practices & Prods. Liab. Litig., E.D. Va., No. 15-cv-md-02627, 9/11/15).The complaint sets forth claims in cases from California, Florida, Illinois, New York and Texas.The plaintiffs seek restitution for the cost of Lumber Liquidators flooring products, an injunction barring the company from engaging in “unlawful, unfair and fraudulent business practices,” and individual and class action damages, according to a Sept. 14 press statement issued by plaintiffs' counsel Cohen, Milstein, Sellers & Toll, in Washington, D.C.The plaintiffs also seek a jury trial, according to the putative class action complaint.The complaint creates a framework for resolution of pretrial motions in cases from 30 states now centralized in the U.S. District Court for the Eastern District of Virginia (115 DEN A-13, 6/16/15).The filing came in response to a Sept. 3 court order directing plaintiffs' lead counsel to identify—in consultation with lead counsel for the defendants—claims from states with the largest number of Lumber Liquidators stores “or with other characteristics that would capture a disproportionate number of potential class members and best allow common issues to be addressed.”At least one of the cases was to originate in California, according to the court's Sept. 3 order. California's laws are a significant factor in the litigation not only because at least 35 cases on the MDL docket are from that state, but also because many of the pending cases allege that Lumber Liquidators misrepresented its wood flooring products as compliant with formaldehyde safety standards set by the California Air Resources Board (42 DEN A-11, 3/4/15).Defendants in the litigation have until Sept. 30 to file an answer to the representative complaint or move for dismissal under the procedure set by the court.Pretrial Approach DisputedLumber Liquidators had opposed the pretrial procedure ultimately adopted by the court, which was advocated by lead plaintiffs' co-counsel Steven Toll of Cohen, Milstein, Sellers & Toll. Nancy Fineman of Cotchett, Pitre & McCarthy in Burlingame, Calif., and Steven Berman of Hagens Berman Sobol Shapiro in Seattle, also serve as plaintiffs' co-lead counsel in the litigation.The company argued for the filing of a single master complaint that consolidated and superseded the 134 individual complaints. It cited inherent due process violations in identifying “representative” cases presenting different parties, class definitions, state law issues and remedies.“Far from promoting efficiency, this proposal instead invites endless litigation,” defendants' lead co-counsel Diane Flannery of McGuireWoods in Richmond, Va., and William Stern of Morrison & Foerster in San Francisco, contended.The plaintiffs' proposal, in which a representative complaint would test the laws of five states (California plus two states selected by plaintiffs and two by defendants), was described by Lumber Liquidators as unwieldy and unfair, according to court documents preceding the court's Sept. 3 order.The court acknowledged in its order that the representative complaint wouldn't resolve issues raised in all cases, but said it wouldn't allow the procedure to “unduly delay the court's dealing with any other preliminary issues raised by these other cases or affect the nature, scope or timing of discovery as to all cases.”State Cases Also in PlayLumber Liquidators faces related litigation in at least eight state cases in six states, according to recently-filed court documents. The company reported ongoing proceedings in cases filed in California, Florida, Illinois, Indiana, New Jersey and Virginia.

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4. ECHA Highlights Biocide Notification Cutoff Date

   Sep 14, 2015 | BNA Daily Environment Report

   By Stephen Gardner

   Companies have until Oct. 30 to submit a notification if they want to continue to use in the European Union certain substances in some biocidal products, the European Chemicals Agency (ECHA) said Sept. 14.The deadline applies to a limited number of substances in biocidal products that were available on the EU market on May 14, 2000, but are now considered “not supported,” meaning no company has submitted a notification to ECHA that it wants to use the substance in a particular biocidal product.Under the EU's 1998 Biocides Directive (98/8/EEC), substances available prior to May 14, 2000, were included in a review program to assess their safety. New substances and products introduced after that date required pre-approval before they could be sold on the EU market.When the Biocides Directive was replaced by the 2012 EU Biocidal Products Regulation (BPR, 528/2012/EU), the review program was revised (215 DEN A-5, 11/6/14).A subsequent regulation on the review program (Regulation (EU) No 1062/2014) listed 46 entries of “not supported” substance/product combinations that will be dropped from the review program unless notification are submitted to ECHA by Oct. 30.

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Chemical Security News

5. PHMSA Finds Probable Violations by Plains Pipeline

   Sep 14, 2015 | BNA Daily Environment Report

   The company whose Santa Barbara County, Calif., pipeline spilled more than 100,000 gallons of crude oil in May likely violated several pipeline safety laws in Bakersfield, Calif., prior to that incident, according to the nation's pipeline regulator. This is the latest blemish for Plains All American Pipeline LP, which has also come under public, congressional and federal scrutiny for a smaller Bond County, Ill. spill in July (136 DEN A-22, 7/16/15). Plains Pipeline likely failed to keep adequate records of pressure tests for certain breakout tanks or of some preventative and mitigative evaluations for high consequence areas, the Pipeline and Hazardous Materials Safety Administration said in a Sept. 11 Notice of Probable Violation and Proposed Compliance Order. The company also likely didn't take adequate preventative and mitigative actions, or document why those actions weren't taken, for its infrastructure in high consequence areas and likely didn't maintain adequate documentation for its emergency response training program or its operator qualification, the order said. In its proposed compliance order for Lines 901 and 903 of its crude oil pipeline system in Bakersfield, PHMSA said the company should take a number of steps, including conducting tests with crude oil for certain breakout tanks that can't be subject to hydrotests. The Sept. 11 notice and proposed order, which stems from PHMSA's 2013 and 2014 investigation, is available athttp://phmsa.dot.gov/pv_obj_cache/pv_obj_id_B95B81133E46C9672606DE501839F5D9C1530200/filename/520155019_NOPV_PCO_09112015.pdf.
   

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6. Mccarthy To Be Called On The Carpet Over Mine Waste Spill

   Sep 14, 2015 | Politico

   By Eric Wolff

   THE WEEK AHEAD IN CONGRESS: LEGISLATORS WANT EPA'S MCCARTHY TO SPILL ON SPILL: EPA Administrator Gina McCarthy will probably see lawmakers in her sleep by the time this week is over. Four separate Congressional committees have summoned her to the woodshed to explain her agency's role in the Gold King Mine spill that dumped 3 million gallons of mine waste into the Animus River.
   
   

   enate: Wednesday is Animas River Spill Day in the Senate! Get your bottles of Arsenic Water at the door! McCarthy has Senate committees in both the morning and the afternoon. She will start her day with the Committee on Environment and Public Works and then end with the Committee on Indian Affairs. In addition to the mine inquiries, the Senate Commerce Committee on Thursday will discuss pipeline safety at a field hearing in Billings, Mont. where federal pipeline safety chief Marie Therese Dominguez will testify. ME has never been to Billings, but Trip Advisor appears to recommend that the senators and Dominguez visit local pub Uberbrew for the schnitzel and beer. If Dominguez and Senate Republicans can't mend fences over schnitzel, then politics truly are broken.

   House: House Majority Leader Kevin McCarthy will head to Texas tomorrow to preview the GOP's fall energy agenda in a speech to the Greater Houston Partnership in Houston, a local business partnership that tries to improve life in the country's main oil hub. Also on Tuesday, the Committee on Natural Resources will host a field hearing in New Orleans on the effects of federal energy policy on the Gulf Coast. Sens. David Vitter and Bill Cassidy will testify at the hearing. EPA Administrator McCarthy on Thursday will reprise her starring role in the Senate from a day before when she discusses her agency's response to the Animas river spill to a joint hearing before the House Committee on Oversight and Government Reform and the Committee on Natural Resources. Joint hearings apparently get to summon twice as many officials, as McCarthy will have to share billing with Interior Secretary Sally Jewell.

   IT WILL BE A MAGICAL MONDAY! I'm your host, Eric Wolff, and I think we finally broke with summer this weekend. A nice crisp tinge in the air, always a good sign of weather to come. Bitter about the oncoming autumn and winter? Let me know it, and send your energy tips, quips, and comments to ewolff@politico.com, or follow us on Twitter @ericwolff, @Morning_Energy, and @POLITICOPro.

   DOE TO PULL PLUG ON OHIO URANIUM ENRICHMENT PROJECT: After years of complex arrangements, last-minute funding drama, congressional advocacy—including letters signed by the likes of Speaker John Boehner—and, lest we forget, a mountain of cash, the Energy Department is walking away from Centrus Energy’s American Centrifuge Project. Just after 7 p.m. Friday, the company announced that DOE would extend a contract for further research on the uranium centrifuges originally destined for the Ohio plant, but discontinue funds used to keep ACP going. The new contract supporting the research, which has taken place at Oak Ridge national lab in Tenn., will be funded to tune of $35 million, a 60 percent overall cut, but runs through Sept. 30, 2016, with the possibility of extension. According to the Portsmouth Daily Times, about 235 WARN Act notices were sent to company employees in Piketon, Ohio (http://bit.ly/1ilZt9j). Centrus: http://bit.ly/1F4MEdr

   So long loan guarantee? DOE’s retreat from the project further undermines the company’s on-again off-again efforts to secure a $2 billion federal loan guarantee intended to back ACP, which the company started building in 2007 and has sunk about $2 billion into. Prepare yourself for chatter about President Barack Obama breaking his “Piketon Promise,” a reference to campaign commitment candidate Obama made to work to secure the project’s loan guarantee. Democratic Ohio Sen. Sherrod Brown called Friday’s decision to pull funds “shortsighted.” GOP Sen. Rob Portman went further, saying that he was stunned and surprised by DOE’s “irresponsible decision to shut down our one source of enrichment needed for our nuclear arsenal, our nuclear navy, private sector nuclear power fuel needs, and nuclear nonproliferation efforts.” Portman, who is up for reelection next year, said the decision was especially upsetting because it comes as the White House is pushing for an Iran nuclear deal that allows that country to maintain some of its own enrichment infrastructure. There’s small chance that Congress might force the issue with additional appropriations later this month before the current contract expires but as Yoda would say: Holding our breath, we are not.

   Last year, GAO suggested that DOE may be applying an overly strict interpretation of the international agreements to require that only a U.S. uranium producer can supply U.S. military nuclear needs (see: Centrus’ American Centrifuge Project). But the traditional, and more prevalent, view does mean that there won’t be a domestic source of new enriched uranium for the Navy, among others, for many more years. However, the project had already been struggling especially hard since the Fukushima nuclear disaster. The Japanese disaster gutted several plans to build new nuclear power plants around the world (even China, which is building a lot of reactors, took a brief pause after the disaster) and price of nuclear fuel plummeted due to an oversupply of uranium on the market. In the end, though, DOE does get away with the advance centrifuge tech and an opportunity to decouple from a company many aren’t too fond of.

   We’ll be watching Centrus’ stock, LEU, today.

   SOURCE: EXELON LOOKING TO SETTLE MERGER WITH D.C. MAYOR: With ten days left to ask D.C. regulators to reconsider their denial of its merger proposal with Pepco Holdings, Exelon Corp. has apparently put a settlement proposal in front of D.C. Mayor Muriel Bowser, according to a source opposed to the deal with contacts in D.C. government. The source told ME that Bowser’s staff is crafting something of a settlement counteroffer. Two sources also said that former D.C. Mayor Tony Williams has been tapped to help push the merger. Of course, an offer doesn’t mean Mayor Bowser will go for it or that her potential counteroffer will be easily swallowed by Exelon. Even if the mayor and the utilities reach a settlement, it doesn’t seem likely to change the views of the D.C. Public Service Commission although that’s what this strategy is hoping to do. Bowser’s office didn't respond to an email request for comment sent Sunday morning. For its part, Exelon said, "We plan to file a petition for reconsideration before the PSC within the 30-day period and are not prepared to discuss the specifics of our merger approach at this time." Still, anyone watching this drama ought to keep their expectations in check. D.C. regulators weren’t enticed by the idea of special conditions when they rejected the merger last month. Regulators viewed their responsibilities as determining whether the merger was in the public interest, and “It is not our obligation to craft conditions to make a proposed transaction that does not satisfy our public interest standard into one that meets that statutory test,” their rejection decision (http://bit.ly/1UPqLAE) stated.

   FERC COMMISSIONERS SHOULD NOT WAVE DELICIOUS SCHNITZEL AT FASTING PROTESTERS: The sidewalks of First Street NE will be lined with a dozen protesters who have pledged themselves to a water-only fast for 18 days. The members of Beyond Extreme Energy will be holding up their banners for FERC stakeholders to see every day through Friday, Sept. 25, Ted Glick, a spokesman for the group, told ME. The group wants FERC to stop issuing any permits for fossil-fuel based infrastructure, including pipelines and import or export terminals for natural gas. "FERC is an agency that is actively promoting fracking in the United States and sending that gas around the world we are totally against that," Glick said. Members of the group will be holding banners up for FERC from 7 a.m. to 6 p.m. every weekday, from 9 a.m. to 5 p.m. on Saturdays, and from 1 p.m. to 5 p.m. on Sunday. "Extremely desolate here, as far as people, in the weekends," Glick said. "Very different from during the work week." A spokesman from FERC did not respond to ME's admittedly late request for comment.

   ** A message from The CRUDE Coalition: American consumers are benefiting from the lowest gasoline prices anywhere in the world today. That's boosting household budgets and the wider economy by billions of dollars. Don't raise gasoline prices by shipping US crude to China. See what American voters think here. http://bit.ly/1Kdqt0D **

   PIPELINE CAMPAIGN BEGINS WITH SLOW BURN: The Interstate Natural Gas Association of America, an industry association of pipeline builders, will launch a campaign on Twitter, Facebook, and LinkedIn to "spark a conversation and help educate Americans about the benefits of natural gas and the pipelines that move gas to customers," according to INGAA spokeswoman Cathy Landry. The campaign will spend in the "very low six figures" and will not purchase any sponsored links, at least early on. http://bit.ly/1QyztD1

   GREENS SEE CALIFORNIA CLIMATE GLASS HALF FULL AFTER SB 350 PASSES: After all a legislative trench war consumed the California Assembly last week, both bodies of the state legislature passed a revised version of SB 350 shortly before midnight on Friday. The bill represents a rare defeat for Gov. Jerry Brown, who pushed hard to get this one through before he and Senator Pro Tem Kevin de León relented and watered down the bill by removing provisions to slash the state's oil consumption. The bill that did pass puts California's renewable portfolio standard at 50 percent by 2030, one of the highest among U.S. states, though behind Vermont and Hawaii. It also increases building efficiency standards, creates incentives for electric cars, and asks the California Independent System Operator to explore how it might be governed if other states joined its market. Michael Brune, executive director of the Sierra Club, said in a statement, "The significance of this move will echo around the world."

    

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7. EPA: Former Chemical Site Owners Agree To Cleanup Plan

   Sep 14, 2015 | Associated Press (In Washington Post)

   The Environmental Protection Agency says former owners of a site once used to handle and store chemicals have agreed to reduce chemical contamination and control leakage of hazardous materials into groundwater.

   The property known as the former Townsend Industries Facility includes about 12 acres and a 45,000-square-foot building. It is located in Pleasant Hill.

   The EPA says a variety of hazardous waste compounds have been detected.

   It was owned by TH Agriculture & Nutrition from 1975 to 1981 and Elementis Chemicals from 1981 until 1985.

   The companies agree under the proposed settlement to operate and maintain groundwater containment and remediation systems “as long as needed to clean up an off-site contaminant plume and reduce the mass of on-site contamination.”

   The current owner, a company called DD#1, must provide site access.

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8. McCarthy in Hot Seat Over Colo. Spill

   Sep 15, 2015 | E&E Daily

   By Manuel Quiñones

   U.S. EPA Administrator Gina McCarthy will face deep scrutiny on Capitol Hill this week over the agency's handling of an abandoned-mine spill in Colorado last month.

   EPA and its contractor caused the 3-million-gallon spill from the Gold King mine into the Animas River, an accident that occurred during an investigation of ways to remediate pollution concerns at the site (Greenwire, Aug. 7).

   McCarthy has confirmed her appearance before the Senate Environment and Public Works Committee tomorrow morning, a panel spokeswoman said yesterday.

   Then the Senate Indian Affairs Committee will take the baton tomorrow afternoon, when it holds a hearing on the spill's impact on tribal land downstream, including the Navajo Nation.

   And McCarthy is scheduled to testify again Thursday during a joint hearing of the House Oversight and Government Reform Committee and the House Natural Resources Committee.

   Panel leaders also invited Interior Secretary Sally Jewell, whose department is conducting a probe of the spill. She declined to appear, according to an agenda of the meeting.

   Lawmakers on the House Science, Space and Technology Committee, the first panel to hold a hearing on the spill last week, criticized McCarthy for skipping the meeting and sending Assistant Administrator Mathy Stanislaus instead.

   Republicans on the panel, many of whom have long been critical of EPA, accused the agency of negligence and a lack of transparency surrounding the incident.

   GOP lawmakers say EPA was not holding itself to the same standards to which the agency holds private companies that pollute waterways. Some pointed to the BP PLC Gulf oil blowout and the West Virginia chemical spill (Greenwire, Sept. 9).

   Democrats, however, have been pointing to the broader problem of unreclaimed abandoned mines around the country. They say GOP ire against EPA is misplaced.

   But it's not only Republicans complaining. Navajo Nation leaders, set to speak again this week, have called for continued water deliveries and funding for their own river tests.

   A preliminary internal EPA report on the spill found that staffers underestimated the risk of a polluted water blowout at Gold King. The agency said it should have done more to alert downstream communities faster.

   And while the long-term consequences of the spill remain unknown, and the Navajo are concerned about contaminated sediment, EPA officials say the Animas and San Juan rivers have returned to pre-spill conditions.

   EPA leaders say they have suspended cleanup-related work at other facilities around the country as a precaution to make sure polluted water hasn't built up as it did at Gold King.

   Schedule: The Senate Environment and Public Works Committee hearing is Wednesday, Sept. 16, at 9:30 a.m. in 406 Dirksen.

   Witness: EPA Administrator Gina McCarthy.

   Schedule: The Senate Indian Affairs Committee hearing is Wednesday, Sept. 16, at 2:15 p.m. in 628 Dirksen.

   Witnesses: TBA.

   Schedule: The House Oversight and Government Reform and the Natural Resources committee hearing is Thursday, Sept. 17, at 10 a.m. in 2154 Rayburn.

   Witnesses: McCarthy; Ryan Flynn, New Mexico environment and natural resources secretary; Russell Begaye, Navajo Nation president; and Mike Olguin, Southern Ute Tribal Council member.

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9. Senate Field Hearing Focuses On Oversight Agency, Mont. Spill

   Sep 15, 2015 | E&E Daily

   By Hannah Northey

   A Senate Commerce subcommittee will discuss the summer oil spill in the Yellowstone River and the pipeline regulator during a field hearing Friday in Billings, Mont.

   Marie Therese Dominguez, who leads the Pipeline and Hazardous Materials Safety Administration, will address the hearing focused on the pipeline rupture that spilled almost 40,000 gallons of oil into the Yellowstone River. Exxon Mobil Corp., which operated the pipeline, was later slapped with a $1 million penalty (Greenwire, June 15).

   The Subcommittee on Surface Transportation and Merchant Marine Infrastructure, Safety and Security will also hear from representatives of Yellowstone County, Mont., and the Montana Liquid and Gas Pipeline Association.

   A subcommittee spokesman said Chairwoman Deb Fischer (R-Neb.) and Sen. Steve Daines (R-Mont.) will attend. There could be a follow-up hearing in Washington, D.C.

   Dominguez will likely be grilled on PHMSA's role in overseeing a number of high-profile spills. The agency's authorization runs out Sept. 30 (E&E Daily, April 15).

   In recent months, PHMSA has been blasted for failing to enact congressionally mandated pipeline safeguards, including spill notifications and the use of automatic and remote-control shut-off valves. The agency has responded by stepping up its pace in implementing the law and beefing up its staffing (Greenwire, July 14).

   The Senate only last month confirmed Dominguez to her post. She had been PHMSA's deputy administrator since June, after having worked previously for the U.S. Army Corps of Engineers, Postal Service and Federal Aviation Administration.

   Schedule: The hearing is Friday, Sept. 18, at noon in Room 148 of the Billings Library, Montana State University, Billings.

   Witnesses: Marie Therese Dominguez, administrator, Pipeline and Hazardous Materials Safety Administration, Department of Transportation; Todd Denton, president of Phillips 66 Co.; John Ostlund, commissioner with Yellowstone County; and Michelle Slyder, with the Montana Liquid and Gas Pipeline Association.

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Energy and Environment News

10. U.S. Shale’s Looking Bleaker, Says Ex-Aramco Oilman

    Sep 14, 2015 | Blog Wall Street Journal

    By Kevin Baxter

    U.S. oil production could sink to as low as 8.4 million barrels a day as beleaguered shale producers continue to get battered by low prices, according to the former head of exploration and production of the Saudi Arabian Oil Company (Saudi Aramco).

    Sadad al-Husseini, who now runs an oil consultancy service, says that based on the market report released by the Paris-based International Energy Agency on Sept. 11, coupled with rig activity and production data from the U.S., production could be slashed by 700,000 b/d within the next 11 months.

    “The accelerated rate of decline from shale oil wells will take its toll,” he says. “The new rigs are more productive but they can’t replace the 1,000 rigs that have gone out of the market,” he said.

    Despite showing remarkable resilience over the last 15 months, some U.S. shale oil producers are in a perilous position as sub-$50 oil begins to really eat into cash reserves and profits.

    Shale oil wells deteriorate far quicker than conventional wells and many that were drilled prior to June 2014 when crude prices began to fall are now approaching the end of their lifecycles. However, with finance beginning to dry up, it is unlikely that the high investment levels seen in 2013 and 2014 will continue, analysts have said. Capital spending in the U.S. oil sector is estimated to drop by as much as $45 billion in 2015.

    The Paris-based International Energy Agency (IEA) is being more positive, stating in its report last week that production will drop by 400,000 b/d to 8.7 million b/d by the end of 2016.

    The key factor underpinning production in the U.S.’s tight oil sector will be how many of the main players survive the winter, before oil prices are expected to recover. If several of the larger operators run out of capital and go under, it will prove extremely difficult to stem a sharp downward trend in output, industry experts think. If they can stick around long enough to see oil prices recover to the $55-$60 a barrel mark, then the sector could begin to recover in the second half of 2016, they think.

    Oil markets dipped Monday, with global benchmark Brent down 1.68% to $47.26 and WTI down 0.95% to $44.08 for cargoes loading in October.

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11. Panel to review well control rule at field hearing in La.

    Sep 15, 2015 | E&E Daily

    By Daniel Bush

    The House Natural Resources Committee is holding a field hearing in Louisiana this morning to review the impacts of federal regulations on offshore oil and gas drilling in the Gulf of Mexico.

    Committee members will hear from Louisiana Republican Sens. David Vitter and Bill Cassidy and the Obama administration's top drilling regulator for the Gulf Coast region, as well as industry executives and an official with the conservation group Gulf Restoration Network.

    The field hearing at the Louisiana Supreme Court in New Orleans comes as the Bureau of Safety and Environmental Enforcement seeks to finalize a sweeping rule proposed earlier this year to improve the reliability of blowout preventers, the device that failed to control the flow of oil into the Gulf after BP PLC's Macondo well exploded in 2010.

    Known as the well control rule, the regulation would create new industry standards for blowout preventer safety and more stringent requirements for other aspects of well control and design.

    Complying with the new standards could cost energy producers up to $883 million over the next decade, BSEE Director Brian Salerno said when the rule was proposed in April (E&ENews PM, April 13).

    Critics argue that the rule would slow oil and gas drilling just as producers are starting to regain their footing after BP's oil spill.

    Offshore oil production in the Gulf generated 529 million barrels of oil in 2014, BSEE records show, the first year-over-year rise in production since the BP spill and the brief federal moratorium on offshore drilling in the region that followed.

    "Under the guise of preventing future disasters, proposed regulations such as the well control rule threaten to cause yet another offshore drilling moratorium without providing demonstrable gains in safety," a committee memo on the field hearing stated.

    Congress should focus instead on energy policies, like lifting the decades-old ban on crude oil, that would foster economic growth, the memo added.

    The memo also questioned BSEE's projected $883 million compliance cost for the rule, noting that an American Petroleum Institute-commissioned study estimated the "cumulative direct" costs could reach $32 billion over the next decade.

    Schedule: The hearing is Tuesday, Sept. 15, at 9 a.m. at 400 Royal St., New Orleans.

    Witnesses: Sen. David Vitter; Sen. Bill Cassidy; Lars Herbst, BSEE regional director, Gulf of Mexico outer continental shelf region; Joe Leimkuhler, vice president of LLOG Exploration Co.; Joseph Mason, professor at Louisiana State University; Lori Davis, president of RIG-CHEM; and Jonathan Henderson of the Gulf Restoration Network.

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12. Barton Seeks 'Sweet Spot' On Crude Exports

    Sep 15, 2015 | E&E Daily

    By Geof Koss, Daniel Bush and Hannah Northey

    The House Republican leading efforts to repeal the ban on crude oil exports is talking with Democrats to find "middle ground" that would boost the bill's overall support when it comes to the floor in the coming weeks.

    Rep. Joe Barton (R-Texas), the chairman emeritus of the Energy and Commerce Committee, said last week that he's confident there's enough support in the House to pass his bill (H.R. 702) ending the ban but doesn't expect President Obama to sign the measure without a strong show of support from Democrats in both chambers.

    "We want to put this bill on the president's desk," he told E&E Daily on Friday. "But to get it to the president's desk, you've got to have at least 60 votes in the Senate and it needs to come out of the House with a strong vote. It doesn't have to have a two-thirds vote, but it has to have enough Democrats that it shows it really is bipartisan."

    The measure, which will be marked up in full committee Thursday, continues to pick up support, with 130 official co-sponsors listed yesterday. That tally includes 15 Democrats, some from the conservative Democratic Blue Dog Coalition, whose 15 members signaled in a statement last week they'll back the measure.

    Committee members are slated to give opening statements on the export bill and a sweeping energy package, the "North American Energy Security and Infrastructure Act of 2015," starting tomorrow. Votes on both pieces of legislation are scheduled for Thursday, the committee said in a memo yesterday.

    Rep. Henry Cuellar (D-Texas), whose district includes a large portion of the Eagle Ford Shale play, told attendees at an Energy Allies breakfast last week that he and Continental Resources Inc. founder Harold Hamm convinced a majority of the members of the Blue Dog Coalition to support Barton's bill during a presentation the week prior. Cuellar expressed optimism that he would bring more Democrats on board and the legislation would be headed to the president's desk by the year's end.

    Barton on Friday said he's having discussions with Democrats about the bill but reiterated his opposition to changes that would hand federal bureaucrats powers over exports.

    "As long as you don't mess with the fundamental market principle -- we have no restrictions on refined products, refiners can sell to who they want, as much as they want, when they want," he said. "Give the producers the same right to sell the crude product, then the market will work. So that's sacrosanct. But some of these other issues that they're raising, there is middle ground, or at least there could be middle ground. Real legislating is finding that sweet spot where both sides get something that they want. And I think we can do that on this bill."

    George Baker, executive director of Producers for American Crude Oil Exports (PACE), said yesterday that lawmakers should support ending the ban on the merits.

    "We think that the enormity of the benefits all by themselves create a compelling case for doing this, in terms of the GDP development, the economics, the jobs, the national security implications, we think those all make the case quite compellingly without any further political logrolling," he said.

    But he added, "That said, it is commonplace for people to try and pair things up within their own particular agendas, that people might raise those issues at this point in time. Seeing that the oil export thing is gathering momentum isn't a surprise at all, it's not a surprise at all. It's to be expected. But we haven't seen proposals that are seriously proposed at this time."

    'A mix of views'

    But what exactly Democrats want in exchange for allowing crude exports isn't entirely clear.

    Senate Minority Leader Harry Reid (D-Nev.) recently suggested he would be willing to discuss exports if tax credits for renewables are part of the talks -- echoing a view expressed by more junior members of his caucus (Greenwire, Aug. 25).

    Senate Minority Whip Dick Durbin (D-Ill.) has also signaled a receptiveness to allowing some exports but is hesitant about lifting the ban entirely.

    Rep. Frank Pallone (D-N.J.), the ranking member of the Energy and Commerce Committee, has also shown a willingness to look at ending the ban, although he told E&E Daily last week that this week's expected full committee markup is premature.

    "I just think we need more time on this," he said.

    During last week's House subcommittee markup of Barton's bill, Democrats complained about the potential effect on domestic refiners (Greenwire, Sept. 10).

    One such Democrat -- Texas Rep. Gene Green -- continues to work on changes that would address his concerns about refiners, a spokeswoman said Friday.

    An industry official opposed to exports said the "mix of views" from Democrats on what such a deal might contain stems from the fact they've been preoccupied with other matters and have only recently turned attention to the issue.

    "I don't think that there's any consensus," the observer said. "I think some people are talking to the other side and seeing what in theory they could get for something like this."

    But given their adversarial relationship with the oil industry, it's unlikely Democrats will sign off on exports without expecting a substantive policy win for themselves, the source added.

    Noting his close relationship with Democrats and Energy and Commerce Chairman Fred Upton (R-Mich.) and Energy and Power Subcommittee Chairman Ed Whitfield (R-Ky.), Barton said there's "frank back and forth" going on now.

    "And again, if both sides get something, then you get bills the president signs and become permanent law and stays permanent law," Barton said. "And that's our goal. We want to repeal this ban with a permanent law change that sticks."

    Enviros gearing up for battle

    But while lawmakers insist that a deal appears within reach, environmental groups say a majority of Democrats won't back a bill that would permanently lift the ban on exports in exchange for a temporary extension of tax credits for wind or solar.

    "For many of the folks that we work with it's definitely a nonstarter," said Lena Moffitt, director of the Sierra Club's Dirty Fuels Campaign. "We're definitely not ready to talk about a deal."

    Stephen Kretzmann, the executive director of Oil Change International, said lifting the ban would increase fossil fuel production and drive up carbon emissions. Without a ban in place, domestic oil production would spike by 436,000 barrels of oil per day and generate more than 4 billion tons of carbon emissions, according to a study the environmental group released last year before oil prices dropped.

    Green groups "are almost certain to oppose any deal," Kretzmann said. "At the end of the day, we see anything that expands oil production as a bad move."

    Others said they haven't started mobilizing opposition to the industry-led campaign for lifting the ban because the effort is likely to die in the Senate, where Republicans need six Democrats to back an exports bill.

    "The likelihood of this passing is not high," said Tyson Slocum, the director of Public Citizen's energy program. "People don't see the need to horse trade right now on something that they don't think is going to move" in the Senate.

    Still, Slocum acknowledged that export ban opponents could wind up tucking language lifting the ban into a bill such as the sweeping energy package moving through both chambers this fall.

    "The more likely situation particularly in the Senate is attaching some form of modification or elimination of the oil export ban to a broader piece of energy legislation," Slocum said.

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13. Oil Patch Braces for Financial Reckoning

    Sep 14, 2015 | http://www.wsj.com/articles/oil-patch-braces-for-financial-reckoning-1442274651

    By Daniel Gilbert, Erin Ailworth and Alison Sider

    U.S. energy companies have defied financial gravity for more than a year, borrowing and spending billions of dollars to pump oil, even as crude prices plummeted. Until now.

    The oil patch is expected to finally face a financial reckoning, experts say, with carnage occurring as early as this month. One trigger: Smaller drillers are bracing for cuts to their credit lines in October as banks re-evaluate how much energy companies’ oil and gas properties are worth. But with oil trading below $45 a barrel, bigger oil outfits are struggling to stay profitable, too.

    Jim Flores, vice chairman of Freeport-McMoRan Inc., which pumps oil in the Gulf of Mexico, explained the industry’s conundrum this way: “It’s raining and it’s going to rain for a long time. We’re all going to get wet. A few people are going to drown. You just have to make it to the other side.”

    Mr. Flores’s friend Al Walker, chief executive of Anadarko Petroleum Corp., one of the biggest oil companies in the U.S., recently told the audience at a Barclays energy conference, “Frankly at the end of the day, none of us have a great sense for where oil prices are going.”

    Some smaller companies are already negotiating with their lenders, dumping assets at distress-sale prices and delaying payments to vendors as they try to preserve cash.

    “There clearly are companies that are going to have to reposition their businesses,” said Michael McMahon, a managing director at investment firm Pinebrook Capital Partners, which has $6 billion under management and provides cash to startup energy producers.

    Though the financial pain likely will be concentrated among some of the smaller and more debt-laden companies, it could ultimately have big effects on the global oil markets.

    Federal data released last month showed that U.S. production has finally started to fall, to about 9.3 million barrels a day in June, down roughly 3% since 2015 oil output peaked in April. And capital constraints could help push output down by 500,000 barrels a day by the end of 2015, Citi Research estimates.

    That would be like Exxon Mobil Corp., the largest energy company in America, halting its U.S. oil production—and then some. Put another way, it would require nearly 20 publicly traded U.S. independent oil companies with a market capitalization of $2 billion or less to stop pumping crude altogether.

    “With eight bankruptcies already announced this year, weaker producers could live or die by the whims of capital providers,” Citi analysts wrote recently, predicting that banks will reduce borrowing bases by as much as 15%.

    If banks make cuts of this magnitude, some $10 billion of liquidity could dry up, according to a Wall Street Journal analysis of securities filings by 75 exploration and production companies. So far, only a few drillers have been spared; Rex Energy Corp., a Pennsylvania-based oil and gas producer, said last week that banks had maintained its $350 million credit line.

    Even with stricter limits on how much drillers can borrow, some analysts think stronger companies will find a way to cope, such as obtaining cash infusions from private-equity investors. Even oil wells operated by an insolvent producer could also keep pumping if they’re acquired by another company, or taken over by creditors in a bankruptcy.

    Small and midsize drillers pioneered the technologies that unlocked oil and gas from dense layers of shale rock across North America.

    The shale specialists have proved resilient even as oil prices fell by nearly 60% in the past 15 months, slashing billions from their budgets, negotiating discounts from suppliers and drilling wells faster and cheaper.

    But crude prices show little sign of rebounding this year, and many firms are still operating at a deficit. Of the 40 American producers followed by analysts at Wells Fargo Securities Research LLC, just two are expected to finance their operations from the cash they bring in this year.

    This leaves companies largely dependent on cash from Wall Street to keep them going—cash that will be in shorter supply. Energy producers listed on U.S. and Canadian exchanges have raised nearly $21 billion by issuing shares so far this year, according to Dealogic, but the offerings had slowed to just $333 million in August.

    On the debt side, many American oil companies anticipate that banks will curb their credit lines, which are often secured by the value of oil and gas holdings. Low oil prices make those properties less valuable.

    Banks already cut back on some credit lines in the spring, and are beginning another round of reviews that is likely to lead to further cuts.

    “Those folks who squeaked by in the spring may have issues in the fall,” said Jim Rebello, a managing director at Duff & Phelps Securities LLC.

    W&T Offshore Inc. said Sept. 1 it would sell a prized Texas shale-oil prospect for $376.1 million—half what analysts projected it could fetch when the company first weighed selling it last year. W&T, which operates in West Texas and the Gulf of Mexico, has said it plans to use the cash to pay back money it has borrowed on its credit line; it didn’t respond to requests for comment.

    Lenders cut W&T’s credit line by 20% to $600 million earlier this year after it had already drawn $515 million. W&T took out another $300 million loan to help pay down debt, triggering a further reduction of its credit line, to $500 million. The company’s stock-market value has fallen by about three quarters in the past 12 months, to $234 million.

    “They’re flying pretty close to the sun,” said John Freeman, an analyst at Raymond James. “That credit facility was going to be under some more pressure the rest of this year.”

    Magnum Hunter Resources Corp. has obtained permission from lenders to delay paying its bills four times since April. It was briefly in default of its credit agreement last month because bills for $8.8 million hadn’t been paid in more than 180 days.

    Gary Evans, chief executive of Magnum Hunter, said it had made payments to cure the default. And the company has more cash coming in soon; it plans to sell a pipeline and has a preliminary agreement for private-equity funding.

    Halcon Resources Corp. last month persuaded lenders to forgive $500 million in exchange for a claim on its oil and gas properties and a higher, 13% interest rate. The company didn’t respond to requests for comment.

    More distress is probably in store for many companies because the insurance they purchased as protection against low oil prices is increasingly expiring. Simmons & Company International estimates that 36 U.S. drillers have hedges to sell 33% of their oil for an average of $80 a barrel this year; next year, hedges would cover just 18% of their oil at $67 a barrel.

    Wells Fargo analyst David Tameron said the healthiest thing for the oil patch would be for industry to go through “one final flush” where the price of crude falls to $40 a barrel and stays there for the next six months. Such a decline would force a number of companies out of business. “Get rid of the dead wood,” he said. “The worst thing possible, in my opinion, is if oil goes higher from here and everybody lives to fight another day.”

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14. EPA Revises Aluminum Facility Emissions Standards

    Sep 14, 2015 | BNA Daily Environment Report

    By Patrick Ambrosio

    Primary aluminum reduction plants will be required to control previously unregulated emissions of polycyclic organic matter under revised national emissions standards set by the Environmental Protection Agency.The revised standards, which apply to 11 industrial facilities currently operating in the U.S., would require the installation of pollution controls on previously uncontrolled pitch storage tanks, a change that the EPA estimated would reduce emissions of polycyclic organic matter by 1.55 tons per year.The regulatory change resulted from a periodic review of the standards, which apply to facilities that produce aluminium from refined bauxite ore using a series of cells that are referred to as potlines.The agency's final rule (RIN 2060-AQ92) also set risk-based emissions limits for emissions of polycyclic organic matter, arsenic and nickel from Soderberg potlines, an older technology that is higher emitting and less-efficient than other types of potlines in use. Those new limits are not expected to result in any emissions reductions because the only two facilities in the U.S. that used Soderberg potlines have permanently shut down since the EPA started its rulemaking process.The final rule also established work practice standards for various facility operations, revised monitoring requirements and eliminated provisions that exempted primary aluminum facilities from complying with air toxics standards during periods of startup, shutdown and malfunction. The removal of that exemption is consistent with a 2008 federal appeals court ruling that found such 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 final rule was signed Sept. 10 by EPA Administrator Gina McCarthy and posted to the agency's website late Sept. 11. Overall, the rule is expected to cut compliance costs by about $165,000 per year across the industry due to an expected reduction in testing costs, the agency estimated.

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15. Rebuttal: The Case For EPA’s Proposed Methane Regulations Is Just Common Sense

    Sep 14, 2015 | BNA Daily Environment Report

    By Mark Brownstein

    On the Congress blog last week, Katie Brown argued against the Environmental Protection Agency’s proposed new rules to reduce the 7 million tons of methane emissions released by the oil and gas industry each year. Those companies could easily be rallying around solutions to a problem they’ve already agreed is manageable. But instead, Brown repeats flawed, misleading and all-too-common talking points that minimize the problem.  

    By resisting the commonsense rules, Brown and others are rejecting a great opportunity for industry to step up and embrace practical, cost effective measures that can create significant pollution reductions alongside strong economic growth. 

    First, know this: Methane emissions are a big problem that’s only going to get bigger. Brown and many in industry point to small-sounding leakrates reported in scientific research, including studies spearheaded by EDF, to suggest emissions are low. But it’s not the rate that matters, it’s the volume. And that volume is huge – again, seven million tons each year according to EPA. That has the same 20-year climate impact as 160 coal-fired power plants. And it’s enough wasted natural gas to supply over 5 million American homes. 

    And as Brown herself points out, research indicates those numbers could be even larger than we realize. For example, one of the latest studies in EDF’s comprehensive series of peer-reviewed studies on oil and gas methane emissions shows previously unrecorded emissions from thousands of U.S. gathering facilities are eight times higher than estimates. Another series of studies in the Barnett Shale region found that overall emissions are roughly 50 percent higher than current estimates. 

    And if we don’t take action, these emissions are projected to increase 25 percent in the next ten years.  

    It’s clear we’re facing a big problem, but there are cost-effective solutions readily available to address it, and they can go hand-in-hand with economic growth and job creation. A 2014 report by ICF international found that the oil and gas industry could cut methane emissions 40 percent with an investment of less than one-third of one percent of the current price of natural gas.

    Brown ignores cost-effective opportunities to solve the problem, falling back on industry boilerplate that regulations will hurt business. But the evidence proves her wrong: Last year, Colorado became the first state to directly regulate methane emissions from the oil and gas industry. Since then, its oil and gas-producing areas had leading job growth. Weld County, the heart of Colorado’s boom, had the highest job growth in the nation at 16 percent, and just down the road, Adams County ranked third in the nation in percentage employment gains. In Wyoming, which enacted similar rules, employment grew 5 percent last year. 

    These types of successful, commonsense regulations are not “superfluous” as Brown argues, but are necessary to provide consistent standards that get results and eliminate operational uncertainty. 

    Without these regulations, we know industry won’t take comprehensive action to address the methane problem. One example is the EPA’s voluntary reduction program, Natural Gas STAR, which has been around for 20 years, but has seen participation from less than one percent of companies in the industry in that time. While some leading companies have made commendable efforts, that hasn’t solved the problem. And without the level playing field of sensible standards, it’s not going to. 

    Brown’s suggestion that methane from the oil and gas industry is not a significant problem dangerously mischaracterizes the magnitude of industry’s methane emissions and the impact of those emissions on our climate. Squabbling about leak rates misses the point that we have a real opportunity to create standards that address methane pollution without hurting the economy. EPA’s methane rules are a win-win proposition, and one that industry – and Brown – should embrace.

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16. Adviser: States Need to Start Work on Clean Power Plans

    Sep 14, 2015 | BNA Daily Environment Report

    By Carolyn Whetzel

    The Environmental Protection Agency's Clean Power Plan offers states a lot of flexibility, so developing compliant plans will not be difficult, an adviser at the Regulatory Assistance Project said Sept. 14.Released Aug. 3, the plan (RIN 2060-AR33) is a big improvement over the initial proposal, Ken Colburn, the one-time state air quality official, said. The Clean Power Plan is legally defensible and states should be developing their plans as soon as possible, he said.The regulation targets carbon dioxide emissions from existing power plants, and sets emissions rates or alternatively mass-based goals for the power sector in each state (149 DEN B-1, 8/4/15). It requires state plans to meet those targets. States failing to provide their own plans will have to comply with the federal plan.Working CloselyImplemented under Section 111(d) of the Clean Air Act, the Clean Power Plan doesn't require the typical prescriptive type of clean air plan with which state air quality officials are familiar, he said. As a result, air quality officials will need to work closely with energy officials, public utility commissions and others, Colburn said.Colburn was among several speakers, including EPA's Acting Administrator of Air and Radiation Janet McCabe, urging state energy officials attending the National Association of State Energy Officials 2015 Annual Meeting in San Diego to get involved in the planning process early on.McCabe said the EPA's collaboration with the Department of Energy and Federal Energy Regulatory Commission helped improve the final plan.“We spent a lot of time with DOE and FERC and built things into the final rule” to address grid reliability concerns, McCabe said.While the final rule is still being readied for publication next month, the agency is continuing to accept comment on the related proposals, including model rules, a federal plan for states that don't develop plans and the Clean Air Incentive Program, she told the NASEO gathering.Amy Zimpfer, an associate director of the EPA Region 9 Air Division, said the region is working to better understand energy issues, including the varied resources and the mix resources, in the western states to aid in the implementation of the Clean Power Plan.“It's a steep learning curve,” Zimpfer said. “Sometimes flexibility comes with complexity.”The EPA Region 9 already is working with California to determine how its mix of policies will lead to a compliant state plan, she said.Colburn urged the energy officials to work closely with their respective EPA regions and to begin thinking like “air quality regulators,” not just like energy officials. Regarding cost-effective strategies, he said energy-efficiency strategies are key and states must being tracking and counting those programs.The Clean Power Plan is a big deal, but the EPA's updated ozone standard will be released later this year, Colburn said. State air quality officials need to be thinking of how their Clean Power Plans can also reduce emissions of air pollutants and address water issues, he said.

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17. E&E Hub Gets Updates As States Weigh Options

    Sep 14, 2015 | E&E News PM

    By Emily Holden and Rod Kuckro

    As reticent states weigh whether to write compliance plans or challenge U.S. EPA's Clean Power Plan in court, E&E staff have been updating the Power Plan Hub with interviews with regulators, agency officials, and environment and business interests.

    Almost every state will have new information by the end of this week, so stay tuned.

    Last week, E&E reporters got an hourlong tour of M.J. Bradley & Associates' revamped Clean Power Plan compliance tool. The resource is free and helps states estimate how various policy decisions might help them move toward interim and final goals. A new version allows states to evaluate whether they might benefit from working with others. The consulting firm says more than 30 states and all the grid operators have downloaded a copy.

    Go to E&E's Power Plan Hub to read more of this weekly column and to see the latest news, state summaries and developments.

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18. Court Clears Duke Energy Plan to Clean More Coal-Ash Pits

    Sep 14, 2015 | Associated Press (In New York Times)

    A judge on Monday rejected a bid by North Carolina's environment agency to block Duke Energy from removing toxic coal ash from more plants than required under a new state law.

    Duke Energy has asked to add three power plants to the list of four plants where they will begin scooping the ash, which is leaking arsenic, lead and other pollutants into waterways.

    Superior Court Judge Paul Ridgeway announced the order after the state Department of Environment and Natural Resources sought to stop Duke Energy from going beyond a new state law requiring it to excavate pits at four plants.

    The state agency argued Duke Energy doesn't have infinite money and time to clean out the problem sites. The company shouldn't decide which get top priority without public input, agency attorney Anita LeVeaux said. The agency also is trying to limit costs that Duke Energy later could seek to pass along to electricity customers, agency spokeswoman Crystal Feldman said.

    The state stepped up its regulations last year after coal ash collected at the utility's Eden power plant spilled into the Dan River, coating 70 miles of the waterway in toxic, gray sludge. The state law requires Duke Energy to stop pollution leaking from all 14 of its North Carolina coal ash dumps by 2029.

    The law orders excavation at four power plants the state has deemed high priority: Asheville; Riverbend in Mount Holly; Sutton in Wilmington; and Dan River in Eden. The rest could be capped with plastic and the ash left in place.

    Duke Energy now wants to scoop coal ash out from seven plants. Environmental groups asked the judge to approve the plan. The three additional power plants — Cape Fear in Moncure, H.F Lee in Goldsboro and Weatherspoon near Lumberton — have ash pits that are either in flood plains, close to riverbanks or are held back by dangerously unstable dams, said Southern Environmental Law Center attorney Frank Holleman.

    "This is where the engineering inexorably led the company," Duke Energy attorney James Cooney said. "This is the only environmentally sound, cost-efficient way to close these places because of the site characteristics."

    Lawsuits seeking to enforce clean-water laws were filed months before the February 2014 Dan River spill.

    "We have seen in this case the serious consequences of delay" by the state environment agency, Holleman said.

    Environmental lawyers allege that Duke Energy's coal ash pits are contaminating rivers and groundwater used as sources of drinking water by hundreds of thousands of people. Coal ash, the residue left after coal is burned to generate electricity, contains toxic chemicals including arsenic, lead, chromium and thallium.

    Environmental groups also contend the state environment agency has a long history of lax enforcement of clean water regulations that should have required Duke to clean up its mess years ago. Before the Dan River spill occurred, the agency proposed settling the lawsuit if the company paid a $99,100 fine, but wouldn't have required that Duke remove any coal ash. The offer was retracted after the spill.

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19. House Set to Pass Gas Turbine, Natural Disaster, Land Bills

    Sep 15, 2015 | E&E Daily

    By Katherine Ling

    A bill that could aid states and utilities in meeting U.S. EPA's Clean Power Plan is scheduled for a vote tomorrow in the House, along with other legislation focused on natural disasters and public lands.

    The House will consider H.R. 2961 -- a bill to create a research and development program for advanced gas turbines for power plants -- under a suspension of the rules, according to a schedule released by Majority Leader Kevin McCarthy (R-Calif.).

    The noncontroversial measure sponsored by Reps. Paul Tonko (D-N.Y.) and David McKinley (R-W.Va.) would develop a multi-year program to boost gas turbine combined-cycle efficiency to 65 percent and simple-cycle efficiency to 50 percent through advanced high-temperature materials and greater operational controls, both of which would lower carbon and nitrogen emissions. The program would also support component testing and field demonstrations.

    New research to allow the turbines to run hotter, more efficiently and longer will help states run natural gas more often to replace coal-fired electricity -- a key element to the Clean Power Plan. EPA's 2030 greenhouse gas emissions reductions targets for each region were based on the assumption that natural gas power plants would eventually run at 75 percent capacity, as measured in the summer.

    The House is also likely to adopt a Senate amendment to H.R. 23, a reauthorization of the National Windstorm Impact Reduction Act. The bill -- which easily passed the House the first time around -- would update a program aimed at reducing loss of life and property from tornados and hurricanes.

    Under the bill, the program would be extended until fiscal 2017 but with less authorized funding than in the past. In total, agencies would be capped at $21.4 million each year for the program, dependent on congressional appropriators.

    The bill would also add nor'easters to the program's purview and transfer responsibility for planning and coordination to the National Institute of Standards and Technology. Currently, the Office of Science and Technology Policy holds that oversight.

    Also on tap for consideration are a range of noncontroversial land bills:H.R. 1214, by Rep. Mark Amodei (R-Nev.), to expand the authority of the Agriculture secretary to sell "small isolated parcels" of the National Forest System, as well as parcels "encumbered with certain special uses such as cemeteries."H.R. 1289, by Rep. Mark DeSaulnier (D-Calif.), to allow the Interior Department to acquire, by donation, approximately 44 acres to include in the John Muir National Historic Site in Martinez, Calif.H.R. 1554, by Rep. Scott Tipton (R-Colo.), to convey the 148-acre Elkhorn Ranch land parcel in the White River National Forest to Gordman-Leverich LLP. The bill is co-sponsored by Colorado Democratic Rep. Jared Polis.H.R. 2223, by Rep. Doug Lamborn (R-Colo.), to facilitate the exchange of 83 acres of federal land in the Pike National Forest in El Paso County, Colo., in return for 320 acres of land owned by Broadmoor Hotel Inc. in the Teller County portion of the forest. Polis is also a co-sponsor.H.R. 2791, by Rep. Peter DeFazio (D-Ore.), to place certain publicly owned forestlands in western Oregon in federal trusts benefiting the Cow Creek Umpqua tribe and the Confederated Tribes of Coos, Lower Umpqua and Siuslaw Indians. The bill would also call for forestlands held in trust for the Coquille tribe to be managed under federal law generally applicable to Indian forestlands.

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20. Gov. Brown to Push Climate Policies With Regulation

    Sep 14, 2015 | BNA Daily Environment Report

    By Mark Chediak and James Nash

    Gov. Jerry Brown (D)'s dreams of cutting California's gasoline use in half and imposing a stricter limit on greenhouse-gas emissions may have died on the legislative floor last week. But they live on elsewhere.There are plenty of ways for the four-term governor to achieve his goals with an end-run around the legislature. For one, Brown has state agencies under his control already entrusted with his climate change mission. And he suggested the week of Sept. 7 that he is ready to use them to achieve his targets.The California Air Resources Board that runs the state's carbon market and other programs aimed at curbing pollution “has all the power that it has had, and it will continue to exercise that power, certainly as long as I'm governor,” Brown said during a press conference with reporters Sept. 9.The governor of the most populous U.S. state would be taking a page straight from the Obama administration's play book, exacting his climate policies through regulatory means after failing to push them through the legislature.In August, the U.S. Environmental Protection Agency issued rules (RIN 2060-AR33) that will establish a carbon-trading system, five years after Republicans in Congress shot down Obama's plan for a federal cap-and-trade program (166 DEN A-9, 8/27/15).Leaving His LegacyBrown “will try to use state agencies to reduce greenhouse gases including reducing petroleum,” said Jessica Levinson, a professor at Loyola Law School in Los Angeles who focuses on governance and election law. “He largely sees the environment as part of his legacy.”Two key pieces of legislation championed by California's environmentalists and their allies, including Brown and Democratic leaders, were killed in the session that ended Sept. 11. One would have cut fuel use in half by 2030. The other would have rolled back greenhouse-gas emissions to 80 percent below 1990 levels by 2050 (see related story).The California Air Resources Board has already started programs that will help Brown achieve his goal of cutting petroleum demand, said Dave Clegern, a spokesman for the agency in Sacramento. “We know it is manageable and we are proceeding as he has directed,” Clegern said.In the absence of a legislative mandate, Brown may also issue executive orders or start a ballot initiative to achieve his climate goals, Levinson said.In some ways, he already has.An executive order that Brown signed in April calls for a 40 percent cut in greenhouse gases by 2030 from 1990 levels (83 DEN A-16, 4/30/15). That alone would require California to source more than half its power from clean energy sources, said Terrie Prosper, a spokeswoman for the California Public Utilities Commission.“The CPUC has authority to set procurement requirements,” she said. “The governor's executive order would give us direction to use that in our procurement.”

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21. House Republicans Plan to Call for Action on Climate Change

    Sep 15, 2015 | National Journal

    By Clare Foran

    A Co­ali­tion of House Re­pub­lic­ans is gear­ing up to make waves by call­ing for ac­tion to fight cli­mate change on the eve of Pope Fran­cis’s vis­it to Cap­it­ol Hill.

    Ten Re­pub­lic­ans have so far signed onto a res­ol­u­tion af­firm­ing that hu­man activ­ity con­trib­utes to cli­mate change and en­dors­ing ac­tion to re­spond to the threat of Earth’s chan­ging cli­mate. The res­ol­u­tion is ex­pec­ted to be un­veiled as early as Thursday.

    Rep. Chris Gib­son, a New York Re­pub­lic­an, led the charge in craft­ing the res­ol­u­tion and con­vin­cing oth­er Re­pub­lic­ans to speak out in sup­port. “This is a call for ac­tion to study how hu­mans are im­pact­ing our en­vir­on­ment and to look for con­sensus on areas where we can take ac­tion to mit­ig­ate the risks and bal­ance our im­pacts,” Gib­son told Na­tion­al Journ­al.

    Reps. Ileana Ros-Le­htin­en and Car­los Cur­belo of Flor­ida, Robert Dold of Illinois, Dave Reich­ert of Wash­ing­ton, Pat Mee­han, Ry­an Cos­tello, and Mike Fitzpatrick of Pennsylvania, and Richard Hanna and Elise Stefanik of New York all con­firmed to Na­tion­al Journ­al that they have signed on as co­spon­sors of the res­ol­u­tion.

    The tim­ing is no ac­ci­dent. Pope Fran­cis has warned that man-made cli­mate change will hurt the poor and most vul­ner­able mem­bers of so­ci­ety, and the Vat­ic­an is call­ing onworld gov­ern­ments to work to­geth­er to fight glob­al warm­ing in June.

    When Fran­cis speaks to Con­gress next week—an event that will mark the first time any pope has ad­dressed a joint ses­sion of the House and Sen­ate—he is widely ex­pec­ted to call for bold and de­cis­ive ef­forts to com­bat Earth’s rap­idly-rising tem­per­at­ures.

    Cli­mateWire first re­por­ted Gib­son’s plan to in­tro­duce the res­ol­u­tion this week.

    En­vir­on­ment­al­ists are pre­par­ing to seize on the oc­ca­sion of the pap­al vis­it, and the en­thu­si­asm for cli­mate ac­tion it is ex­pec­ted to gin up, by or­gan­iz­ing a ma­jor cli­mate rally on the Na­tion­al Mall the day of the speech on Sept. 24.

    But a call for ac­tion on glob­al warm­ing led by Re­pub­lic­ans is something al­to­geth­er dif­fer­ent.

    Ever since the col­lapse of com­pre­hens­ive cli­mate le­gis­la­tion, which died in the Sen­ate dur­ing Pres­id­ent Obama’s first term, Re­pub­lic­ans have largely shunned le­gis­lat­ive ef­forts to con­front glob­al warm­ing. Even ad­mit­ting that hu­man activ­ity has caused tem­per­at­ures to rise has be­come vir­tu­ally off-lim­its among Re­pub­lic­ans.

    On the 2016 cam­paign trail, some Re­pub­lic­ans such as Sen. Ted Cruz of Texas still deny the real­ity of glob­al warm­ing, while oth­ers such as former Sen. Rick San­tor­um have said that there is noth­ing the United States can do to make a dent in the situ­ation.

    Re­pub­lic­an pres­id­en­tial con­tenders are un­an­im­ous in voicing op­pos­i­tion to Pres­id­ent Obama’s reg­u­la­tions to rein in car­bon emis­sions from power plants, a ma­jor policy ini­ti­at­ive that the White House has taken to com­bat the threat of glob­al warm­ing.

    At least some mod­er­ate Re­pub­lic­ans have grown frus­trated by what they see as their party’s si­lence on a press­ing and ur­gent prob­lem. The En­vir­on­ment­al De­fense Ac­tion Fund, the polit­ic­al arm for the mod­er­ate en­vir­on­ment­al or­gan­iz­a­tion En­vir­on­ment­al De­fense Fund, bank­rolled a ma­jor ad buy last year in a bid to bol­stergreen-minded Re­pub­lic­ans, an at­tempt to turn the tide in the face of con­ser­vat­ive in­ac­tion when it comes to cli­mate change. 

    Vir­tu­ally all of the House Re­pub­lic­ans who have signed on to the soon-to-be in­tro­duced cli­mate res­ol­u­tion hail from mod­er­ate or swing dis­tricts, many in the North­east­ern U.S.

    A num­ber of the co­spon­sors are up for reelec­tion in 2016 in mod­er­ate dis­tricts where back­ing a res­ol­u­tion in fa­vor of cli­mate change could help them in the race. Cur­belo and Dold are both run­ning for reelec­tion. Reich­ert, Mee­han, Cos­tello, Hanna, Ros-Le­htin­en, and Stefanik have not yet an­nounced if they plan to run for reelec­tion.

    Gib­son, the lead au­thor of the res­ol­u­tion, and Rep. Fitzpatrick are not run­ning for reelec­tion.

    Forty-eight per­cent of Re­pub­lic­an voters prefer a can­did­ate call­ing for ac­tion to tackle hu­man-made glob­al warm­ing, as op­posed to someone who sidesteps the is­sue en­tirely or calls cli­mate change a hoax, ac­cord­ing to a sur­vey re­leased in Janu­ary by The New York Times, Stan­ford Uni­versity, and en­vir­on­ment­al think tank Re­sources for the Fu­ture.

    Still, the res­ol­u­tion is all but guar­an­teed to spark cri­ti­cism from en­vir­on­ment­al­ists, who are likely to say that that the call to ac­tion is watered down. While the res­ol­u­tion notes that hu­man activ­ity con­trib­utes to a chan­ging cli­mate, it stops short of ex­pli­citly ac­know­ledging the sci­entif­ic con­sensus that hu­man activ­ity has been the primary driver of glob­al warm­ing in re­cent years.

    Many en­vir­on­ment­al­ists be­lieve that mean­ing­ful ac­tion to tackle rising tem­per­at­ures will come only on the heels of an af­firm­a­tion of that sci­entif­ic con­sensus, warn­ing that if law­makers do not em­brace the con­sensus as fact, it will be far too easy to find ex­cuses not to act.

    For now, the fate of the Re­pub­lic­an cli­mate push re­mains un­clear. House Speak­er John Boehner has dis­missed the threat of man-made cli­mate change in the past, say­ing that he is not qual­i­fied to de­bate cli­mate sci­ence.

    
    

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22. California Bill to Boost Renewables Goes to Governor

    Sep 14, 2015 | BNA Daily Environment Report

    By James Nash

    Solar- and wind-power entrepreneurs will get a bigger share of California's energy market. Construction contractors will get more work tightening the energy efficiency of buildings. And environmentalists will tiptoe closer to their goal of weaning the most-populous U.S. state from fossil fuels.California lawmakers Sept. 11 passed a watered-down version of what state Senate President Kevin de Leon had billed as part of the “most far-reaching effort to fight climate change in the history of our nation.” Before lawmakers stripped out provisions including a 50 percent rollback in gasoline use, de Leon's bill, S.B. 350, had drawn opposition from building owners, the oil industry, retailers and even fruit and vegetable growers (176 DEN A-16, 9/11/15).The changes neutralized nearly all of the organized opposition, while maintaining the support, albeit more muted, of environmentalists.“I can't even say that utility customers will be disadvantaged,” said Steve Chadima, director of California Initiatives at Advanced Energy Economy, an association of businesses in efficiency retrofits and solar and wind power. “If the whole thing had passed, I might say employees of fossil-fuel companies would be disadvantaged, but that didn't happen here.”Half of Electricity From RenewablesThe bill, which passed the state Assembly 51-26 and Senate 26-14 the night of Sept. 11, requires that half of all electricity come from renewable sources by 2030 and that building owners double energy efficiency by that year. It goes to Gov. Jerry Brown, a supporter, for his signature.The clean energy mandate provides a potential $8.6 billion investment opportunity for utility-scale solar projects, according to GTM Research. That figure could vary depending on how much large-scale solar is used to meet the goal and other factors, including projected declines in panel prices and other renewable energy sources. The market could be as much as $10 billion based on an estimate provided by the California Solar Energy Industries Association.The mandate for renewable power is a “huge win” for Californians and the state's $11 billion solar industry, Sean Gallagher, the Solar Energy Industries Association's vice president of state affairs, said in a statement. He said the future of small-scale rooftop solar will depend on a regulatory ruling on the ability of homeowners to sell power back to the grid.Business groups including the California Chamber of Commerce, the California Manufacturers & Technology Association and the California Business Properties Association withdrew their opposition in the days before the vote after de Leon and other lawmakers deleted the fuel-reduction mandate and tweaked the efficiency rules for buildings .The former version of the bill called for doubling the efficiency of all buildings, while the bill approved Sept. 11 seeks to “double the energy efficiency savings in electricity and natural gas end uses,” according to a legislative analysis .The California Business Properties Association, representing commercial landlords, had opposed the previous version of the bill, warning that it could drive up rents and create complexity for building owners. The association dropped its objection after the language was changed.Matthew Hargrove, the association's senior vice president of governmental affairs, said the final bill took a broader approach to energy efficiency rather than placing all the burden on building owners.“It is still a very aggressive goal, and it is still something that we are concerned about assuring that our members can meet as the program moves forward, but we look forward in working with the governor and regulatory agencies to do our part,” Hargrove said by e-mail Sept. 11.For every building owner who has to spend a dollar on new windows or ventilation systems, there is a contractor who stands to make a buck doing the work.“By calling for a doubling in energy efficiency, that means more jobs and more opportunities for consumers to participate in energy savings,” said Steven Schiller, a Berkeley-based consultant who founded the California Energy Efficiency Industry Council.Opponents Say Residential Costs Will RiseThe big losers with the passage of de Leon's bill are Californians, especially in hotter inland areas, who will have to pay higher electricity rates because of the mandate for renewable sources such as solar and wind, according to Republican lawmakers who voted against the legislation.“This bill will increase the cost of living for residents who are already struggling to make ends meet,” said Assemblyman Matthew Harper, a Republican from Huntington Beach, as the body debated the bill late Friday. “Let's not put more Californians into energy poverty by forcing them to pay more just to keep the lights on.”California's three investor-owned utilities publicly supported the bill. Gary Stern, senior director of energy policy for Edison International's Southern California Edison, said the bill would assure “safe, reliable and affordable” power for the utility's 5 million ratepayers. Eugene Mitchell, vice president of state governmental affairs for Sempra Energy,said electrical utilities could see a larger role in building facilities for electric cars. Pacific Gas & Electric Co. also backed the bill.Even with the fuel mandate out of the bill, environmental groups cheered its passage. Sierra Club Executive Director Michael Brune called it a “moment for hope and celebration” in an e-mailed statement. Sarah Rose, chief executive of the California League of Conservation Voters, said in a statement that while she is “deeply disappointed” that the gasoline reduction was taken out of the bill, she nonetheless supported the bill.

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23. California Legislature Approves Climate Bill

    Sep 14, 2015 | BNA Daily Environment Report

    By Devin Henry

    California lawmakers approved a major statewide renewable energy goal as their legislative session ground to a close last week. 

    Members approved a bill late Friday night requiring the state get 50 percent of its energy from renewable sources by 2030. The bill, which also sets energy efficiency standards for buildings, passed the Assembly on a 52-27 vote and the Senate, 26-14. 

    Earlier in the week, lawmakers removed from the bill a key and controversial provision requiring the state cut its oil consumption by 50 percent. Even so, the legislation’s lead sponsor, Senate President Kevin de Leon, said the bill is part of a “historic commitment” to take on climate change. 

    “These new steps build on California’s historic commitment to lead the world in the fight against climate change and build a healthy and livable planet for our children and grandchildren,” he said in a statement. 

    “But our efforts to reduce carbon emissions are far from over as global warming and air pollution remain one of the most important issues of our generation and one the greatest threats for generations to come.” 

    Green groups cheered the action over the weekend. 

    “Today, California demonstrated once again that it is a world leader in tackling the climate crisis, protecting public health, and expanding the booming clean energy economy,” Sierra Club Executive Director Michael Brune said in a statement. 

    “Ensuring that renewable energy makes up half of all electricity sold in the state by 2030 is both necessary and eminently achievable — and the significance of this move will echo around the world.”

    The renewable energy bill was a major priority for Gov. Jerry Brown (D), but he didn’t get everything he wanted from the session. 

    Besides the oil provision, lawmakers also tabled a bill to codify Brown’s aggressive greenhouse gas emission targets into law. The lead legislative sponsor, Democratic state Sen. Fran Pavley, told the Los Angeles Times she will bring it up again next year. 

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24. U.S. and Chinese Cities Pledge Reductions Ahead Of Paris

    Sep 15, 2015 | E&E Daily

    By Jean Chemnick

    U.S. and Chinese cities and states announced new pledges and partnerships today aimed at building momentum toward a high-stakes round of U.N. climate talks in Paris at the end of this year.

    The commitments made at the U.S.-China Climate Leaders Summit are an outgrowth of last year's headline-grabbing emissions reduction agreement between the world's two largest greenhouse gas emitters -- a surprise move aimed at shoring up efforts to secure a global agreement to take effect after 2020.

    White House climate adviser Brian Deese, who is visiting China, said last night on a call with reporters that today's actions would also lend the two countries credibility going in to Paris.

    "Last year having made the focus on setting targets, this year they can increase the credibility of their capacity to implement against those targets," he said. Climate change will also be on the docket when Chinese President Xi Jinping visits the United States to meet with President Obama later this month and is expected to feature heavily in Pope Francis' visit to Congress on Sept. 24.

    Chinese cities representing a quarter of the country's urban emissions -- approximately 1.2 gigatons of CO2 -- pledged to stop growing their emissions before 2030, when China as a whole has promised its output will peak. Beijing and Guangzhou will lead this "Alliance of Peaking Pioneer Cities," pledging to cap their emissions "by the end of or around 2020."

    Deese refused to answer questions about whether that means that Chinese emissions overall will peak sooner than 2030.

    On the U.S. side, California promised to reduce emissions between 80 and 90 percent below 1990 levels by 2050, and Seattle pledged to become carbon-neutral by 2050.

    "That would not have happened but for the intense commitment to implementing our respective targets laid out last year," Deese said.

    He also pointed to participation by some cities with Republican mayors, including Carmel, Ind., in today's announcements.

    Subnational governments and other entities from both countries have also pledged to share best practices and information to help deploy low-carbon energy technology and improve adaptation and planning. Vice President Joe Biden is expected to touch on some of these actions in remarks to the U.S.-China Climate Leaders Summit in Los Angeles tomorrow.

    Countries representing more than two-thirds of the world's greenhouse gas emissions have set post-2020 emissions targets, including the United States and China. But Deese will travel next to India, which has not released its commitment yet toward the agreement -- and is not expected to promise to peak its emissions.

    Deese said yesterday that he anticipated more countries would issue commitments in the coming months.

    "That is a process that we are closely engaged in, and President Obama in virtually all of his international engagements, bilateral and multilateral, is raising this issue reinforcing what the United States is doing, what we are committed to do and the importance of global action on this issue," he said.

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25. U.S. and Chinese Climate Change Negotiators to Meet in Los Angeles

    Sep 15, 2015 | The New York Times

    By Coral Davenport

    President Obama’s top climate change negotiator will meet with his Chinese counterpart in Los Angeles on Tuesday to announce joint actions by cities, states and provinces in both countries to reduce greenhouse gas emissions.

     

    The summit meeting follows a historic accord reached in Beijing in November by Mr. Obama and President Xi Jinping, who pledged to enact policies to cut emissions significantly. Mr. Obama said the United States would reduce planet-warming carbon emissions up to 28 percent by 2025, while Mr. Xi vowed that China would halt its emissions growth by 2030.

     

    That announcement by the world’s two biggest greenhouse gas polluters was seen as a breakthrough after decades of deadlock on efforts to forge an effective global accord on climate change. Now Mr. Obama and Mr. Xi are pushing for the completion of such an accord, signed by every nation on earth, at a United Nations summit meeting in Paris this fall.

     

    The meeting this week in Los Angeles is to be attended by Todd Stern, the United States’ senior climate change negotiator, American mayors and governors, Chinese mayors and other municipal leaders and Chinese climate change officials.

     

    White House officials said on Monday that the meeting was intended to demonstrate that both countries were moving forward to meet the terms of their agreement. Last month, Mr. Obama unveiled a sweeping new regulation aimed at forcing heavily polluting power plants to cut emissions, and both the United States and China have submitted details of their national plans to the United Nations.

     

    Brian Deese, Mr. Obama’s senior adviser on climate change, said the additional actions from cities, states and provinces could add momentum to those efforts. The administration also hopes that the announcements will quiet critics who say that any climate deal will hamstring the United States and cede an economic advantage to China.

     

    “Last year was about the U.S. and China making those commitments,” Mr. Deese said. “This year, having made those commitments, needs to be a year of implementation, as our two countries demonstrate commitment to implement those goals with concrete steps.”

     

    The choice of Los Angeles for the meeting is no coincidence. California has by far the most aggressive state-level climate change policy in the country. The state, which has an economy larger than that of all but a handful of countries, has put in place a “cap and trade” system, in which an overall limit is imposed on greenhouse gas pollution, and companies buy and sell permits to pollute.

     

    Other states, including nine in the Northeast, also have cap-and-trade programs, but Republicans and some Democrats in Congress have successfully pushed against a national system. In its submission to the United Nations, the Chinese government noted that it was considering a national cap-and-trade system, and seven Chinese provinces have pilot programs.

     

    On Tuesday, the two nations will announce an arrangement between government entities in China and California to begin working toward devising cap-and-trade programs in China. Several American climate policy experts have said they envision a future in which California’s cap-and-trade market could be linked with China’s regional cap-and-trade markets.

     

    In addition, the leaders of 11 Chinese cities, including Beijing, will announce plans to reach their emissions peak earlier than the national target of 2030. Those cuts alone could be equal to the annual emissions from Brazil or Japan, according to White House officials. Ten cities from China will partner with 10 from California in a separate initiative that aims to reduce air pollution and attract clean-technology industries.

     

    While the United States, China and more than 40 other countries have submitted their plans to cut carbon pollution ahead of the Paris meeting, other major polluters, including India and Brazil, have yet to do so. United Nations officials have told those governments that for the Paris deal to work, the plans must be submitted by October.

     

    In Washington, Republican leaders are skeptical of the deal and are working to block it. The Senate majority leader, Mitch McConnell of Kentucky, has begun reaching out to other countries to let them know that he is doing everything he can to halt Mr. Obama’s climate change regulations, and thus prevent the United States from meeting its United Nations obligation.

     

    Senator James M. Inhofe, Republican of Oklahoma and the chairman of the Senate Environment Committee, is also working to block the deal, saying the United States would be forced to cut its emissions while China’s pollution would continue unabated. Asked this summer about the Chinese government’s efforts to enact a national cap-and-trade program, including the pilot programs that are already in place, Mr. Inhofe replied, “They’re lying.”

     

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26. EPA Floats Enforcement Priorities for FY 2017-2019

    Sep 14, 2015 | BNA Daily Environment Report

    By Renee Schoof

    The Environmental Protection Agency has proposed its national enforcement priorities for fiscal years 2017-19, including some new initiatives focusing on air toxics and industrial water pollution, according to a notice scheduled for publication Sept. 15.The agency is seeking comment until Oct. 14 on whether, along with the new priorities, it should keep the current six areas of focus—air pollution from power plants and other largest sources; toxic air pollution; pollution from land-based natural gas extraction; pollution from mineral processing operations; raw sewage and contaminated stormwater; and animal waste pollution in water.The new initiatives proposed are an expansion of the initiative on toxic air emissions to include a focus on organic liquid storage tanks and hazardous waste facilities; water pollution by mining, chemical manufacturing, food processing and primary metals manufacturing; and reducing the risks and impacts of industrial accidents involving highly toxic substances.The agency, which selects its National Enforcement Initiatives every three years, also is asking for comment on whether there are any other areas that should be added.Seeking to ‘Make a Difference.'“National Enforcement Initiatives are selected to focus on important national environmental problems where noncompliance is a significant part of it and where we think a federal enforcement program can make a difference,” Cynthia Giles, EPA assistant administrator for enforcement and compliance assurance, told Bloomberg BNA on Sept. 10 outside a conference in Arlington, Va.The EPA makes its suggestions based on data from investigations and the public interest, but also “understanding we live in a time of restrained resources,” she said.The Sept. 15 notice referred to EPA's declining budget over the past five years, and said, “so we need to keep resource constraints very much in mind as we consider taking on new work.”Significant Modification of PrioritiesThis is the first time in the past six years that the EPA has proposed a significant modification of or expansion to its three-year National Enforcement Initiatives, Adam Kushner, an attorney at Hogan Lovells who formerly was director of EPA's Office of Civil Enforcement and director of the Air Division, told Bloomberg BNA Sept. 14.The agency's proposal “signals that EPA is ready to devote significant additional resources to enforcement efforts in these areas,” Kushner said.The proposed new focus on risks from toxic industrial accidents represents an expanded interest to use Clean Air Section 112(r) enforcement authorities under the general duty clause, Kushner said. There have been a number of significant industrial accidents in the past several years that have caused serious injuries and deaths. It appears that the EPA would propose to devote additional resources to make sure appropriate risk management plans are in place, Kushner said.In recent years, EPA has expansively interpreted its authority under Section 112 beyond what Congress intended in the law, Kushner said. The EPA should be sure to remain true to the plain language of the statute and congressional intent, should it move forward, he said.Focus on High-Risk FacilitiesIn its notice for comment, the EPA said about 150 catastrophic accidents occur every year, and that about 2,000 facilities are considered high risk because of their proximity to densely populated areas, the extremely hazardous substances they use or their history of accidents.The EPA said it was considering expanding its air toxics initiative based on what it has learned about the sources of the largest toxic emissions and the causes of the releases. The agency said optical remote-sensing techniques have shown that volatile organic compound and hazardous air pollutant emissions from storage tanks “can greatly exceed the permitted and/or estimated emissions.”The agency also said its observations of hazardous waste sites and publicly available compliance information show what appear to be “widespread violations of the air emission requirements under the Resource Conservation and Recovery Act (RCRA).”All of the new priorities will involve the use of Next Generation Compliance, which involves monitoring technologies, data analytics and publicly available results, according to the EPA's notice seeking comment (26 DEN A-11, 2/9/15)Mining Industry Opposed to ListingThe mining industry indicated that it would ask EPA to remove it from the enforcement priorities list.Luke Popovich, vice president for external communications of the National Mining Association, told BNA in an e-mail: “EPA has failed since 2007 to provide a clear set of performance-based strategy goals or a well-defined exit plan for the mining and mineral processing enforcement initiative. In a time of severely constrained budgetary resources, it is the agency's duty to demonstrate it is appropriately allocating limited federal resources on agency programs. EPA's OECA (Office of Enforcement and Compliance Assurance) is no exception. Given that the mining and mineral processing sector has been an enforcement priority for almost 10 years and has seen notable increases in compliance rates, NMA believes that the mining and mineral processing industry should be removed from the priority list and returned to the core enforcement program.”In other cases, regulated industries tend not to comment because they don't want to draw attention to their own sectors or those of others, said Granta Nakayama, an attorney with King & Spalding who was the EPA assistant administrator for the Office of Enforcement and Compliance Assurance from 2005 through 2009. “It's not really a two-way dialogue,” he said.

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27. Let’s Cut All Energy Subsidies and Start Taxing Pollution

    Sep 15, 2015 | http://blogs.wsj.com/experts/2015/09/15/lets-cut-all-energy-subsidies-and-start-taxing-pollution/

    By Richard Revesz

    Energy subsidies have become a hot topic on the presidential campaign trail. Jeb Bush recently called for an end to all subsidies–those that support fossil fuels as well as those aiding renewable energy. Most Democrats in the presidential race support ending tax breaks for fossil-fuel companies, but believe that subsidies for renewables are needed to help these newer industries grow rapidly.

    Both policy proposals are economically inefficient.

    To create a truly level playing field in the energy sector, all subsidies should be dropped, as Bush suggests. There is no reason for the government to privilege one form of energy production over another.

    But this change must be paired with taxes on pollution, to reflect the harm that pollution causes to health and welfare. By letting energy companies emit greenhouse gases, smog precursors and other pollutants without internalizing the costs, we create a subsidy of a different kind. But this subsidy is worse–it is paid not with taxpayers’ money, but with their health and well-being. And this distortion, like the one caused by monetary subsidies, leads to more pollution than is socially desirable.

    Economists have long studied solutions to this problem. Pollution taxes would internalize the costs of pollution throughout the economy. The government already calculates the appropriate rate for a tax on carbon, in the form of the social cost of carbon. Similar fees could be assessed for other forms of pollution. Pairing these policies with the elimination of subsidies would keep the government from picking winners in the energy sector while tackling dangerous pollution and simplifying the tax code.

    The U.S. government currently gives fossil-fuel companies $4.7 billion in annual subsidies in the form of tax preferences. The actual total is far higher, as the government also allows companies to drill and mine on federal lands with leasing and royalty rates that greatly undervalue resources that belong to the American public. These subsidies increase our reliance on oil, gas and coal, and hide the true costs of these fuels. The price we pay at the pump doesn’t account for billions in lost government revenue or for damages from carbon pollution–economists estimate that every ton of carbon-dioxide emissions inflicts more than $40 of damage to the economy.

    Subsidies for renewable energy can be seen as an effort to offset some of these market distortions. But the result is still economically inefficient. For instance, the solar-energy industry receives more than $2 billion annually in tax preferences, and even more in direct government expenditures, but these subsidies can’t be perfectly targeted. Residential solar installations and utility-scale solar farms – two vastly different technologies that occupy different roles in our energy portfolio – essentially compete for support. These industries gain or lose ground against each other (and against nonrenewable options) based on lawmakers’ decisions.

    Replacing all energy subsidies with pollution taxes would let market forces determine the fates of competing energy sources. The economic costs of pollution would be appropriately factored into all goods and services across the economy. Consumers and investors could then shape our energy system, choosing the most appropriate sources without externalizing pollution costs or worrying that subsidy changes might undermine their decisions. Pollution tax revenue could be returned to the public, and the economy would be significantly streamlined.

    Of course, the next president would need congressional approval to overhaul our system of subsidies, or to enact taxes on pollution. If gridlock continues, we’ll have to choose a second-best solution, likely pairing existing subsidies with environmental regulations or trading schemes to approximate an economically efficient outcome.

    But presidential campaigns are theoretically about ideas. Supplanting subsidies with pollution taxes is an idea we should hear more about during campaign season.

    Richard L. Revesz is dean emeritus and Lawrence King Professor of Law at New York University School of Law, where he directs the Institute for Policy Integrity.He is the co-author of the forthcoming book “Struggling for Air: Power Plants and the ‘War on Coal.’

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28. 'Smart Cities' Program Targets Congestion, Climate Change

    Sep 14, 2015 | E&E News PM

    By Robin Bravender

    The Obama administration today proposed to invest more than $160 million in programs aimed at tackling climate change, reducing traffic congestion and other local efforts.

    The announcement of the administration's new "Smart Cities" initiative comes as the White House hosts a forum today that convenes politicians, researchers, city representatives, members of the technology sector and others to discuss improving cities' technology and infrastructure.

    The White House proposed total investments of more than $160 million in federal research cash under the initiative.

    That spending includes nearly $70 million in new spending and more than $45 million in proposed investments by U.S. EPA, the Energy Department and other agencies focused on issues, including energy, climate preparedness, transportation, safety and health.

    EPA announced new environmental monitoring and analysis programs. The agency will spend up to $4.5 million for grants to conduct air quality pilot studies using low-cost portable air pollution sensors. EPA also plans to launch a new project to help communities plan for public health impacts and deploy "village green" air monitoring stations to Oklahoma City; Hartford, Conn.; and Chicago.

    DOE will invest almost $10 million to expand efforts to support the emergence of "smart, energy-efficient and low-emission cities," the White House said. Those efforts include spending more than $3 million to advance building technologies that maximize energy savings and participate in "smart" communications both within buildings and from buildings to the grid. DOE will also create a new research consortium -- with $5 million in new funding -- to "examine the nexus of energy and mobility for future transportation systems."

    The National Science Foundation also announced more than $35 million in grants and over $10 million in proposed investments in the coming year related to the Smart Cities initiative, the White House said.

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Transportation News

29. Railroad Administration Reopens Risk Rule Comment Period

    Sep 14, 2015 | BNA Daily Environment Report

    The Federal Railroad Administration will again accept comments on its risk reduction proposed rule–this time for three days only. The risk reduction proposal (RIN 2130-AC11) would require Class I railroads—large railroads such as CSX Corp.—and railroads that don't have adequate safety records to submit risk management plans to the Transportation Department. These plans would, in part, need to note any hazardous materials risks to the environment. The agency initially published its proposal in the Federal Register Feb. 27, with a comment period that ended April 28 (80 Fed. Reg. 10,950; 39 DEN A-3, 2/27/15). The agency then reopened its comment period for the rule on July 30 through Sept. 10 (80 Fed. Reg. 45,500). The FRA will reopen its comment period again Sept. 15, and accept comments through Sept. 18 to hear public comments after a late August public meeting on the rule. The notice is available athttps://s3.amazonaws.com/public-inspection.federalregister.gov/2015-23233.pdf.
    

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