Preview Newsletter
PM ACC 6/14/2016
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(ACC Mentioned) Hundreds of Carcinogens Found in Americans' Bodies -- Report
Jun 14, 2016 | E&E Greenwire
By Colby Bermel
Hundreds of carcinogens have been detected in humans, according to a study released today. The nonprofit Environmental Working Group wrote in a new report that 420 known or likely cancer-causing chemicals can be found in people. -
(ACC Mentioned) Concerns Persist with Prop 65 Proposed Reforms
Jun 14, 2016 | Chemical Watch
By Kelly Franklin
A coalition of more than 200 industry groups has called on the Office of Environmental Health Hazard Assessment (Oehha) to address “unclear and ambiguous” areas in its proposed reforms, related to how ‘clear and reasonable’ warning is provided under Proposition 65. -
EPA Scientists Set Goals for New EDSP Computational Toxicity Assays
Jun 14, 2016 | Inside EPA
EPA scientists have set a time line to find replacements for several animal toxicity assays intended to screen chemicals for the potential to disrupt the human endocrine system, focusing in the short-term on replacing androgen hormone receptor... -
Echa to Assess Risks of Cadmium in Recycled PVC
Jun 14, 2016 | Chemical Watch
The European Commission has asked Echa to calculate the quantities and average cadmium content, in mixtures and articles containing recovered PVC. -
Echa's Seac Backs Restrictions on D4 and D5
Jun 14, 2016 | Chemical Watch
Echa’s Socio-economic Analysis Committee (Seac) adopted its Opinion on the siloxane compounds D4 and D5, at its meeting on 31 May-9 June. -
Solutia Appeals Against 'De Facto' Substance Evaluation Decision
Jun 14, 2016 | Chemical Watch
Speciality chemicals manufacturer Solutia Europe SPRL/BVBA has appealed against an Echa Decision from October last year. -
Ryan Releases Plan to Roll Back Obama Regulations
Jun 14, 2016 | Washington Post
By Kelsey Snell
House Speaker Paul D. Ryan (R-Wisc.) is set Tuesday to release a broad GOP proposal to roll back federal regulations on a wide range of issues including the environment, labor and rules on financial institutions following the 2008 economic crisis. -
Hatch Blasts Obama on Energy Tax Policy
Jun 14, 2016 | The Hill - E2 Wire
By Naomi Jagoda
Senate Finance Committee Chairman Orrin Hatch (R-Utah) on Tuesday blasted the Obama administration's stance on energy policy, saying the White House is focused on punishing the production and use of fossil fuels. -
NGA to Assist 4 States with Power-Saving Policy Work
Jun 14, 2016 | E&E Climatewire
By Emily Holden
State officials in Alaska, Michigan, New Hampshire and Virginia will take deep dives on energy efficiency policies in retreats this summer coordinated by the National Governors Association. -
Air Agency Group's Becker Discusses New Guidance for State Compliance
Jun 14, 2016 | E&E TV
As many states move forward with Clean Power Plan compliance planning, the National Association of Clean Air Agencies this month released guidance for states that includes model plans and pathways for compliance. During today's OnPoint, William Becker, the group's executive director... -
Industry Hopes to Avoid 'Death by 1,000 Cuts' in the Southeast
Jun 14, 2016 | E&E Energywire
By Kristi E. Swartz
Natural gas boosters here say the Southeast will capitalize on the cleaner-burning fossil fuel despite what they consider to be widespread attempts to kill it. -
US Shale Oil Production Forecast to Fall in July: EIA
Jun 13, 2016 | Platts
By Benjamin Morse
Oil output in the biggest producing shale areas in the US is forecast to decrease 118,000 b/d in July from June to 4.723 million b/d, according US Energy Information Administration estimates released Monday. -
Nuclear Regulator's Web Apps Need Work -- IG
Jun 14, 2016 | E&E Energywire
By Blake Sobczak
The Nuclear Regulatory Commission should dust off and inventory its overlooked online tools in light of a fast-moving cyberthreat, the agency's inspector general found. -
Industry, Senate Republicans Decry Pipeline Delays
Jun 14, 2016 | E&E Greenwire
By Hannah Northey
Manufacturers, unions and trade groups bemoaned a recent string of rejections and delays of pipeline and export projects today, warning a Senate panel that growing demand for energy is butting up against growing anti-fossil pushback and rigorous... -
Oregon U.S. Senators Critical of Response to Oil Train Derailment
Jun 14, 2016 | Natural Gas Intelligence
By Richard Nemec
Oregon's two U.S. senators on Thursday asked the head of the National Transportation Safety Board (NTSB) why a federal investigative team was not dispatched last weekend to the scene of an oil tanker train derailment in their state near the Columbia River Gorge. -
Senate FY17 EPA Bill Includes Policy Budget Cuts, Riders but Boosts SRFs
Jun 14, 2016 | Inside EPA
By David LaRoss
Senate Republicans are pushing a fiscal year 2017 spending bill for EPA that would cut the agency's existing budget of $8.14 billion down to roughly $8.1 billion with what Democrats say would be 10 percent cuts to major environmental policy areas... -
WOTUS Arguments Will Fall to Next Administration
Jun 14, 2016 | PoliticoPro - Whiteboard
By Annie Snider
A federal appellate court laid out a schedule today that will put the legal defense of the Obama EPA's Waters of the U.S. rule in the hands of the next administration. -
The Supreme Court’s Wake-up Call to Congress on Clean Water Act Jurisdiction
Jun 14, 2016 | The Hill - Congress Blog
By Larry Liebesman and Maj. Gen. (ret) Don Riley
Last month, a unanimous Supreme Court issued a decision with significant implications for federal clean water laws and especially the Obama Administration’s “Waters of the U.S.” regulation. -
California's Cap-and-Trade Program Faces Daunting Hurdles to Avoid Collapse
Jun 14, 2016 | Los Angeles Times
By Chris Megerian and Ralph Vartabedian
The linchpin of California’s climate change agenda, a program known as cap and trade, has become mired in legal, financial and political troubles that threaten to derail the state’s plans to curb greenhouse gas emissions.
Industry and Association News - There are no clips to report at this time.
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(ACC Mentioned) Hundreds of Carcinogens Found in Americans' Bodies -- Report
Jun 14, 2016 | E&E Greenwire
By Colby Bermel
Hundreds of carcinogens have been detected in humans, according to a study released today.
The nonprofit Environmental Working Group wrote in a new report that 420 known or likely cancer-causing chemicals can be found in people. The chemicals come not only from occupational exposure but also from consumer products, pesticides and solvents. And they can combine to create new, devastating disruptions to biological pathways that lead to cancer.
The carcinogens from commercial products identified in the EWG report include those found in furniture flame retardants, dry cleaning solutions, cookware coatings, food wrappers, paint and hair colorings.
"The presence of a toxic chemical in our bodies does not necessarily mean it will cause harm, but this report details the astounding number of carcinogens we are exposed to in almost every part of life that are building up in our systems," Curt DellaValle, author of the report and a senior scientist at EWG, said in a statement. "At any given time, some people may harbor dozens or hundreds of cancer-causing chemicals. This troubling truth underscores the need for greater awareness of our everyday exposure to chemicals and how to avoid them."
While most of the carcinogens catalogued in the report are not necessarily serious health threats, nine of them exceed U.S. EPA safety standards, according to EWG. But the group's primary concern is over the buildup of many carcinogens in the body, which can act in concert to disrupt biological pathways and cause cancer.
People working in certain occupations like petrochemicals and law enforcement are exposed to benzene, a key component of petroleum that is also found in tobacco smoke. Crude oil tank workers are exposed to benzene at a rate seven times higher than American smokers. And police officers breathing traffic pollution in Rome saw benzene levels twice as high as U.S. smokers, according to the report.
The report also identified several cancer-causing chemicals in consumer products. Ethylene oxide is a colorless, flammable gas with a sweet smell that is used in the production of plastics and detergents. The pure form of the chemical is also a hospital disinfectant. Tetrachloroethylene is a colorless liquid commonly used in dry cleaning products, and polybrominated biphenyl is a colorless substance used as a flame retardant and incorporated in the plastics of household electrical appliances.
Exposures to these chemicals are associated with kidney and liver cancer, along with leukemia and lymphoma, among other diseases.
Despite the findings, the report also chronicled a decline in the overall body burden -- a term for how many chemicals are present in one's body -- of Americans. The pesticide DDT was banned by the federal government in 1972, and lead in gasoline was banned in 1995 after a phaseout began 20 years earlier. And last year, the phaseout of the Teflon chemical perfluorooctanoic acid was completed, but it was still detected in 99 percent of a population studied by the Centers for Disease Control and Prevention.
The report found its results through a comprehensive review of scientific literature and publicly available human biomarker data sets, an undertaking EWG says is the first of its kind.
EWG's findings come as lawmakers last week approved a major chemical reform bill, sending it to the White House for an expected signature. Critics -- including EWG -- argue the legislation doesn't go far enough in protecting consumers from carcinogens (E&E Daily, June 9).
American Chemistry Council spokeswoman Liz Bowman said, when asked about the EWG report, "The mere presence of a chemical does not signify risk to health." She touted the passage of reform to the Toxic Substances Control Act of 1976, H.R. 2576, as a boon for public health.
"There are numerous advantages to consumers, health and environmental advocates, and states of subjecting chemicals to a federal program of safety assessment and determination," she said in an emailed statement. "EPA evaluations of more chemicals will lead to greater transparency about chemical properties and risks; increased certainty in how chemicals will be regulated; and, greater confidence that chemicals are being used safely in the marketplace."
DellaValle encouraged more informed individual choices about chemical exposure but said federal and state regulators don't have enough teeth to protect citizens, even after the pending passage of TSCA reform.
"Federal law fails to provide the EPA and [Food and Drug Administration] with the tools needed to ban or even limit carcinogens in everyday products," he wrote in the report. "Regulations on chemicals in cleaners, cosmetics, food and other consumer products should all be strengthened to require expedited review of the most dangerous substances, to ensure they meet the tough 'reasonable certainty of no harm' standard, to provide extra protection for vulnerable populations like children, and to ensure that EPA and FDA have enough data and resources to do the job."
At the same time, a cancer policy debate is beginning to take shape as Vice President Joe Biden has been tasked by President Obama with leading the new National Cancer Moonshot Initiative. Some say the project needs more focus on environmental causes of the disease.
"The environment in general ... I don't want to say it's been overlooked, but it's one of the least-funded issues in cancer," DellaValle said in an interview. "I hope this report brings to light the pervasiveness of environmental exposures that are doing harm in our environment and the need to both dig deeper into the environmental causes of cancer, and to also work on designing prevention and intervention."
When asked whether EWG plans to pursue any follow-up legislation to TSCA or lobby members of Congress or the vice president on the issues, EWG spokesman Alex Formuzis said it hasn't "gone down that road yet."
"There's a lot to be seen," EWG legislative attorney Melanie Benesh added.
http://www.eenews.net/greenwire/2016/06/14/stories/1060038805
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(ACC Mentioned) Concerns Persist with Prop 65 Proposed Reforms
Jun 14, 2016 | Chemical Watch
By Kelly Franklin
A coalition of more than 200 industry groups has called on the Office of Environmental Health Hazard Assessment (Oehha) to address “unclear and ambiguous” areas in its proposed reforms, related to how ‘clear and reasonable’ warning is provided under Proposition 65.
Comments submitted by the California Chamber of Commerce coalition say that “due to the late stage of this regulatory process”, it is focusing on areas it wishes to see Oehha clarify in its final statement of reason (FSOR). It hopes the FSOR will provide clarity “to ensure that the regulated community can clearly understand precisely what Oehha intends and how to comply with the new requirements.”
The comments were received in response to the agency’s third draft of its proposed reforms of how warning is provided under Prop 65. This process was initiated in November, following the agency’s withdrawal of a previous rulemaking that began in January 2015.
The coalition maintains that the proposed rule will create a “new breed of ‘bad warning’ litigation” cases in which, despite using the safe harbour warning content provided by the agency, businesses could be sued.
The majority of the coalition's comments call for clarity to ensure that unnecessary litigation is not brought, over new provisions in the law.
Areas of concern include:
· the phrase “one or more” – in reference to specific substances to be included in warnings – which it says “undoubtedly will serve as a basis for litigation, absent a clear and unequivocal statement that the business has full discretion to determine which relevant listed chemical it will identify in its warning”;
· the term “on product”, with regard to the placement of a warning;
· compliance with the new law prior to its effective date;
· the phrase “without requiring the purchaser to seek out the warning”, as included in provisions on warning provided via electronic device; and
· foreign language requirements.
Previous concerns remain
In addition, many of the concerns raised by specific trade groups throughout the consultation process remain, according to the most recent comments.
The American Chemistry Council reiterated its objection to the proposed requirement for at least one chemical name to appear in safe harbour warnings. It joined other groups protesting against the provision calling for what they describe as an “inappropriate” warning pictogram.
The ACC also took issue with the provisions which limit the information that may be provided to supplement a safe harbour warning. “The government’s proposal to suppress delivery of truthful and accurate information by manufacturers – made worse by government omission of critical information on the agency website, to which it seeks to drive consumers – is more than ironic for a proclaimed ‘right to know’ statute – it violates the First Amendment,” said the trade group.
There were also several concerns that persisted regarding specific environmental exposure warnings, and with provisions related to chemicals in food.
Oehha has said it will address all relevant comments received, throughout the rulemaking, in its FSOR. A final rule is expected before 27 November.
https://chemicalwatch.com/48006/concerns-persist-with-prop-65-proposed-reforms
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EPA Scientists Set Goals for New EDSP Computational Toxicity Assays
Jun 14, 2016 | Inside EPA
EPA scientists have set a time line to find replacements for several animal toxicity assays intended to screen chemicals for the potential to disrupt the human endocrine system, focusing in the short-term on replacing androgen hormone receptor animal assays but also setting longer-term deadlines for steroidogenesis and thyroid assays.
EPA's Seema Schappelle, speaking during a recent public meeting of the Interagency Coordinating Committee on the Validation of Alternative Methods (ICCVAM), said that EPA scientists are working to replace all of the traditional animal toxicology assays in EPA's Endocrine Disruptor Screening Program (EDSP) with 21st century toxicology approaches. ICCVAM includes representatives of nearly a score of federal agencies that regulate or research toxicity testing approaches.
Schappelle, acting director of the exposure assessment and policy division in EPA's Office of Science Coordination and Policy, presented slides affirming the agency's intent to follow its publication last year of a replacement approach for human estrogen hormone receptor tests in the animal-based assays with a replacement approach for androgen receptor hormone assays later this year, as well as replacement steroidogenesis tests.
The slides indicate that EPA has a goal of replacing four of the 11 assays in the first tier of its EDSP with androgen receptor and steroidogenesis replacement models in fiscal year 2016.
Noting that the EDSP is tasked with screening the endocrine disrupting potential of some 10,000 pesticide chemicals and water contaminants, Schappelle said that it would take "decades to screen this universe of chemicals" with the original animal-based toxicology assays in EDSP. Newer toxicology approaches allow EPA's ongoing "pivot" from animal assays, and Schappelle says the intent is to "develop a full set of alternatives" to EDSP assays.
The news about the androgen model echoes information that EPA managers and sources shared last fall when they said the agency was working on an androgen receptor hormone model as a follow-up to the estrogen receptor model that the agency published in June 2015, adding that agency scientists have a goal of presenting a draft of the androgen model to an advisory panel for peer review later in 2016.
But Schappelle's slides also for the first time provide time lines for steroidogenesis replacement approaches and thyroid hormone replacement models. EPA speakers at last November's Future Tox III conference in Arlington, VA, indicated that the thyroid replacement model was the furthest away of the models, while a steroidogenesis replacement model was not discussed.
Pending Model
Schappelle's slides indicate that the goal is for the thyroid replacement model to be developed in fiscal year 2017. An agency source said last fall that scientists hoped to present a preliminary plan for developing the thyroid model to the Scientific Advisory Panel (SAP) that peer reviews the androgen model, because the SAP does not meet frequently.
"Our goal is to finish up the alternatives for the tier one battery over the next couple of years," Schappelle said. "Completing [estrogen receptor (ER)] model and the [androgen receptor (AR)] model is ideally being our next release, and possibly steroidogenesis as the science allows as well."
Schappelle's slides indicate that the agency also intends to develop replacement assays for EDSP tier two assays, more extensive, multi-generational assays intended to provide dose-response information for use in risk assessment of those chemicals that are flagged in the first tier of assays.
EDSP was designed as a two-tier screening system, with 11 animal-based assays intended to flag chemicals that may present endocrine disrupting potential for testing in the second tier of four animal-based assays. Schappelle's slides indicate that managers intend to replace assays in both tiers with non-animal 21st century alternatives.
Schappelle said at the May 25 meeting that "the intention is to develop similar alternatives . . . in the end as we work our way down [the list and] develop a full set of alternatives" to the existing animal-based assays.
Schappelle's slides explain that in FY16, the goal is to publish a Federal Register notice "expanding use of ER model, and establishing use of AR model. The same slide states that in FY17, the plan is to "Refine/Develop ER, AR, [steroidogenesis (STR) and thyroid (THY)] models" while in FY18, the goal is to "Establish AR, STR & THY models."
http://insideepa.com/daily-news/epa-scientists-set-goals-new-edsp-computational-toxicity-assays
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Echa to Assess Risks of Cadmium in Recycled PVC
Jun 14, 2016 | Chemical Watch
The European Commission has asked Echa to calculate the quantities and average cadmium content, in mixtures and articles containing recovered PVC.
The EU executive will use the information to review the existing derogation for cadmium and its compounds, from the REACH restriction on the use of cadmium in PVC and other plastics materials.
The restriction entry in Annex XVII says it must be reviewed "in particular, with a view to reducing the limit value for cadmium and to reassess the derogation" for those applications listed in the entry. These are:
· profiles and rigid sheets for building applications;
· doors, windows, shutters, walls, blinds, fences and roof gutters;
· decks and terraces;
· cable ducts; and
· pipes for non-drinking water if the recovered PVC is used in the middle layer of a multi-layer pipe and is entirely covered by a layer of newly produced PVC.
Echa should use a targeted impact assessment to address different lower maximum cadmium limit values in recovered PVC, down to the full elimination of the derogation.
The Commission has also asked Echa to review the hazards associated with cadmium and the risks associated with the use of recovered PVC, containing the metal.
The agency must complete its preliminary evaluation by 1 September 2017. The Commission will then "consider whether to request" the agency to prepare an Annex XV dossier, with a view to reducing the limit value for cadmium.
The use of cadmium stabilisers in PVC was phased out in Europe many years ago, but cadmium can re-enter the market if long-lived "legacy" products are recycled.
https://chemicalwatch.com/47991/echa-to-assess-risks-of-cadmium-in-recycled-pvc
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Echa's Seac Backs Restrictions on D4 and D5
Jun 14, 2016 | Chemical Watch
Echa’s Socio-economic Analysis Committee (Seac) adopted its Opinion on the siloxane compounds D4 and D5, at its meeting on 31 May-9 June.
Both compounds are used in cosmetics such as shaving foams and shampoos. The UK competent authority recommended restriction in wash-off products to protect the water environment. D4 is persistent, bioaccumulative and toxic (PBT) and D5 is very persistent and very bioaccumulative (vPvB).
Echa’s Risk Assessment Committee adopted its Opinion on the compounds in March. Seac was, however, obliged to hear public comments on its draft Opinion.
Eight comments were received during the consultation, Seac says, which have resulted in some modifications and clarifications. It recommends the European Commission introduce the restriction within two years.
https://chemicalwatch.com/48016/echas-seac-backs-restrictions-on-d4-and-d5
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Solutia Appeals Against 'De Facto' Substance Evaluation Decision
Jun 14, 2016 | Chemical Watch
Speciality chemicals manufacturer Solutia Europe SPRL/BVBA has appealed against an Echa Decision from October last year.
The Decision concerns the substance evaluation of a mixture of two components:
· N-(1,3-dimethylbutyl)-N' –phenyl-p-phenylenediamine ('6PPD'); and
· N1-(1,3-dimethylbutyl)-N4-(4-(1-methyl-1-phenylethyl)phenyl)benzene-1,4-diamine.
Solutia has asked Echa's Board of Appeal to annul the contested Decision in its entirety and refund the appeal fee.
The company is not an addressee of the Decision, but is the lead registrant of 6PPD. It says that as part of the substance evaluation, Echa reviewed and requested information to be generated specifically on 6PPD – the main component of the mixture – and that the information requests directly affect its rights and obligations.
Normal course of action
Solutia says that normally Echa would either conduct a compliance check of the 6PPD dossier, or initiate a formal substance evaluation.
By conducting a "de facto evaluation" of 6PPD in the course of the substance evaluation of the mixture, without providing any particular justification, the company says the agency breached several procedural requirements of the REACH Regulation.
Solutia also says the Decision requested information to fill alleged gaps in standard information requirements – but did not adequately justify why Echa did not, as a first step, conduct a compliance check of the registration dossier of the mixture.
It argues the agency breached the principle of proportionality as the Decision failed to show:
· the necessity of the information requested;
· that there is a potential risk to human health or the environment; and
· that the information requested has a realistic possibility of leading to improved risk management measures.
https://chemicalwatch.com/47997/solutia-appeals-against-de-facto-substance-evaluation-decision
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Ryan Releases Plan to Roll Back Obama Regulations
Jun 14, 2016 | Washington Post
By Kelsey Snell
House Speaker Paul D. Ryan (R-Wisc.) is set Tuesday to release a broad GOP proposal to roll back federal regulations on a wide range of issues including the environment, labor and rules on financial institutions following the 2008 economic crisis.
The aim is to give states more control over of the regulatory process and it is the third installment in Ryan’s agenda project , which the speaker launched earlier this year to allow rank-and-file members to help craft a policy blueprint ahead of the election in November.
Ryan plans to continue rolling out the remaining three segments–on tax reform, healthcare and the constitution–ahead of the party’s nominating convention in July.
The 57-page document to be released Tuesday compiles a detailed list of bills that GOP members have introduced to dismantle many of President Obama’s signature reforms like the Clean Power Plan and the Dodd-Frank Wall Street reform bill. It also includes a proposal to repeal “all climate-change regulations under the Clean Air Act.”
The proposals could provide areas of common ground between House Republicans and presumptive GOP presidential nominee Donald Trump. Ryan and Trump have had an uneasy relationship in recent weeks as Republicans in Washington have tried to grapple with how to embrace their party’s often unpredictable nominee.
Trump has been critical of Obama’s regulatory regime, going so far as to say he would eliminate the Environmental Protection Agency and repeal Dodd-Frank.
Republicans have long argued that Obama’s focus on government regulation has hindered economic growth by preventing entrepreneurs and businesses from growing the economy. The GOP outline frames the full slate of reforms as a key element of the party’s economic agenda.
“What federal agencies need more than anything else is some humility,” the report reads. “At the very least, new and existing federal regulations can be modernized to inflict far less economic pain.”
Unlike previous planks of Ryan’s agenda, the regulatory portion focuses heavily on existing legislation that has been drafted or passed in the House. By including specific bills and actions the document provides a more specific outline of how a GOP-led Congress could work to dismantle Obama’s reforms.
The opportunity to find common ground over policy proposals could be a welcome change for Republicans who have been forced in recent weeks to answer a battery of questions about Trump’s statements on Muslim immigrants, racially-charged criticism of a judge of Mexican descent and repeatedly calling Sen. Elizabeth Warren (D-Mass.) “Pocahontas.”
The House GOP proposal could also have broad appeal for Republicans in the Senate. A large portion of the document focuses on increasing U.S. energy production by slashing regulations on the coal industry, a pet issue for Senate Majority Leader Mitch McConnell (R-Ky.). It also includes reducing hurdles for companies looking to expand offshore drilling or tap into resources on federal lands.
Ryan and several House GOP leaders are scheduled to unveil the proposals Tuesday afternoon at an event outside the Department of Labor.
https://www.washingtonpost.com/news/powerpost/wp/2016/06/14/ryan-releases-plan-to-roll-back-obama-regulations/
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Hatch Blasts Obama on Energy Tax Policy
Jun 14, 2016 | The Hill - E2 Wire
By Naomi Jagoda
Senate Finance Committee Chairman Orrin Hatch (R-Utah) on Tuesday blasted the Obama administration's stance on energy policy, saying the White House is focused on punishing the production and use of fossil fuels.
"Whether it’s an increased per-barrel tax on oil production or higher per-gallon taxes charged on gasoline at the pump, the Obama Administration seems intent on raising the cost of producing or consuming energy from fossil fuels, even if it means increased hardships on middle-class and lower income families," Hatch said at a Finance Committee hearing on energy tax policy.
Hatch said he supports an "all-of-the-above approach" to energy policy and supports promoting alternative energy sources. However, he does not think the cost of existing energy sources should be increased in order to increase the appeal of alternative energy sources.
The committee chairman said that the $10 per barrel oil tax that Obama proposed in his fiscal 2017 budget has been criticized by economists because it would lead to higher energy prices for families and hurt manufacturers.
Hatch also criticized Democrats' carbon tax proposals, saying they would provide Americans with "higher taxes in the form of increased energy costs and reduced wages, relative to the cost of living."
Karen Harbert, president and chief executive officer of the U.S. Chamber of Congress's Institute For 21st Century Energy, also spoke out against taxing the oil and gas industries, saying that Congress should avoid taxing one industry to support another.
Harbert said a carbon tax would hurt the poor and the elderly and have a "constraining effect" on the U.S. economy, hurting the country's economic competitiveness. She pointed out that the oil and gas industry supports millions of jobs and contributes to a significant amount of government revenue.
Benjamin Zycher, a resident scholar at the American Enterprise Institute, said that a carbon tax wouldn't have measurable environmental benefits.
The top Democrat on the Finance Committee, Sen. Ron Wyden of Oregon, urged Congress to extend tax incentives for renewable energy technologies that were left out of last year's tax extenders package.
Wyden also said that in the long term, Congress should move to a "tech-neutral" approach to energy tax policy.
He has put forth a proposal that would replace the current 44 tax breaks with three incentives. Doing so will cut costs and promote clean energy, he said.
"I call it more green for less green," he said.
Two business leaders that testified at the hearing agreed that Wyden's approach would be beneficial.
http://thehill.com/policy/finance/283415-hatch-blasts-obama-on-energy-tax-policy
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NGA to Assist 4 States with Power-Saving Policy Work
Jun 14, 2016 | E&E Climatewire
By Emily Holden
State officials in Alaska, Michigan, New Hampshire and Virginia will take deep dives on energy efficiency policies in retreats this summer coordinated by the National Governors Association.
NGA will visit the states with technical advisers on specific topics and work with teams of 25 to 30 that can include policymakers and industry and advocacy interests.
States will pick what they want to explore and may involve staffers from governors' offices, energy agencies and regulatory bodies, as well as lawmakers.
The retreats will last a day or two but will involve extensive planning and follow-up, said Sue Gander, director of NGA's Environment, Energy and Transportation Division.
The program is funded by a grant from the U.S. Department of Energy's Weatherization and Intergovernmental Programs Office.
NGA has held energy efficiency retreats once before, with six states in 2014. The retreat in Tennessee helped develop the initial program design ideas for a new on-bill energy efficiency financing program with rural electric cooperatives that will be rolled out later this year, according to NGA.
"What states really value is just a chance to bring folks together, have the convening power with NGA and then have top-notch experts come to them," Gander said.
Meredith Hatfield, the director of New Hampshire's Office of Energy and Planning, said her state will focus on how to leverage funding for weatherization programs in low-income communities.
New Hampshire's group will look at which housing areas have the most potential for efficiency improvements that would provide major health and safety benefits.
Hatfield said federal dollars allow the state to help 35,000 people per year with heating costs but only 200 households with weatherization assistance.
The state wants to look at ways to serve more homes, perhaps by making the case to receive more revenues from New Hampshire's participation in the Regional Greenhouse Gas Initiative, a cap-and-trade program in the Northeast.
Right now, most money is rebated to ratepayers, Hatfield said, with some going to targeted programs. Lawmakers would have to sign off on any change to send more dollars to low-income energy efficiency projects.
http://www.eenews.net/climatewire/2016/06/14/stories/1060038774
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Air Agency Group's Becker Discusses New Guidance for State Compliance
Jun 14, 2016 | E&E TV
As many states move forward with Clean Power Plan compliance planning, the National Association of Clean Air Agencies this month released guidance for states that includes model plans and pathways for compliance. During today's OnPoint, William Becker, the group's executive director, explains how states can use NACAA's compliance recommendations to create effective frameworks for U.S. EPA approval, should the power plan be upheld by the courts.
Monica Trauzzi: Hello, and welcome to OnPoint. I'm Monica Trauzzi. With me today is William Becker, executive director of the National Association of Clean Air Agencies. Bill, thank you so much for coming back on the show.
William Becker: Thanks, Monica. It's great to be back.
Monica Trauzzi: Bill, your organization recently released a report that outlines model state plans to support Clean Power Plan implementation. Considering that the rule has been stayed by the Supreme Court pending litigation, why did you feel that now is an appropriate time to release this guidance for states?
William Becker: Well, it was an appropriate time for several reasons. The first is we have no idea what the courts are going to do, and while EPA can't move forward on the rule, states are not prohibited from working on their own. Secondly, what we are finding is that a number of industries are taking advantage of this law in -- during the stay and are actually coming into state regulatory offices and seeking input and also trying to convince the state regulatory agencies that there are economic opportunities for complying. And thirdly, even if the rule is overturned and the states are precluded from implementing the Clean Power Plan, there is enough meat on the bone in this report, there are enough options available for states who wish to use it totally separate and independent of the Clean Power Plan. So for all of those reasons, it was important to release it when we did.
Monica Trauzzi: So you think that despite the stay, states can take the recommendations made in this report to advance the individual discussions that are happening on the state levels on implementation.
William Becker: Absolutely, and the reason is as follows. We are not providing a mandate for the states. We are providing a model, and actually it's a series of models, it's a menu of models, and while there are some comprehensive model plans in Part 3 of the report, throughout the report there are over two dozen individual regulatory models that could be used as part of or separate from the Clean Power Plan, so there is literally regulatory language that a state or locality could incorporate into its strategy irrespective of the Clean Power Plan.
Monica Trauzzi: What assurances can you give states who may follow one of the pathways you provide in the report that it will be approved by EPA should the plan stay in place?
William Becker: So we can give no assurance that EPA has reviewed this because they haven't, but what we can assure the states is this was written by a very smart technical consultant who used to be an air pollution official from the state of Louisiana. Second, we had a group of 25 state and local members on a steering committee who reviewed this work. Third, many of the ideas were derived from discussions that we had with NASEO and NARUC, our partners in state regulatory development. And fourth, the members of our association are very, very smart, and they will determine very quickly the extent to which this should be approvable, and they'll work through the process as they do other plan submittals and try to seek approval from the regions and then from headquarters if necessary.
Monica Trauzzi: So you're in favor of states continuing to work on implementation.
William Becker: We're in favor of giving states the choice. We are totally understand and mindful of the fact that politically some states aren't able to continue during this stay period, but there are many states who are taking advantage of this opportunity and learning more and trying to be prepared in case the stay is overturned, and we think that the states will use this time very wisely and be prepared should the stay be overturned.
Monica Trauzzi: And do you think that those states who are working right now and potentially using the guidance that you're providing in this report, do they have an advantage over the states who have halted action on implementation?
William Becker: Well, they have an advantage in that if they seek to learn the details of the model during this stay, they will be better prepared at the time if the stay is overturned. There will be more catching up for those states that are putting pencils down and not doing anything. You know, unless a governor or a state legislature has tied the hands of a state, I can't see a scenario why a state wouldn't want to proceed, maybe at a slower pace, perhaps not advertise what it's doing, go to meetings, meet with stakeholders, but be smarter in the process so that if and when the stay is overturned or the state decides to go on its own in reducing greenhouse gases, it'll be that much smarter than it otherwise would have been.
Monica Trauzzi: Is your sense that even in the states where compliance discussions have been halted, at least publicly stated that they've been halted, that behind-the-scenes discussions are still happening?
William Becker: Absolutely. I've seen estimates that there have been, you know, three-quarters or more of the states who are still moving ahead, perhaps not full speed ahead, but they're moving ahead, and they're doing so, as I said, not just because they think it's important, but because other stakeholders want to take advantage of that. So I think that most of the states would love to move ahead, but for in a few states, the governor or the state legislature has forbade it.
Monica Trauzzi: Well, because they don't think it's in the best interest of their state.
William Becker: They don't.
Monica Trauzzi: All right. We'll end it right there. Thank you for coming on the show. Nice to see you.
William Becker: You also. Thank you.
Monica Trauzzi: And thanks for watching. We'll see you back here tomorrow.
http://www.eenews.net/tv/videos/2142/transcript
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Industry Hopes to Avoid 'Death by 1,000 Cuts' in the Southeast
Jun 14, 2016 | E&E Energywire
By Kristi E. Swartz
Natural gas boosters here say the Southeast will capitalize on the cleaner-burning fossil fuel despite what they consider to be widespread attempts to kill it.
The region is prime for liquefied natural gas (LNG) terminals, pipelines and storage facilities, all of which will be key to ensuring reliability as the electric industry and its grid continue to transform, industry officials said yesterday. Lobbyists, utility regulators and others called out state and federal governments as well as the environmental community for attacking natural gas, however.
It's the message that needs to change to get everyone to buy in, supporters said.
"It's incumbent on us to get out there and connect with the voters," said Misty McGowen, federal relations director for the American Petroleum Institute.
She cited as examples statewide bans on hydraulic fracturing, rejected pipelines and recent protests at the Federal Energy Regulatory Commission, forcing the agency to meet behind closed doors.
What's more, while the natural gas industry, particularly when it comes to shale gas, has grown despite lack of federal policy, McGowan said there are more than 100 regulations on oil and gas, most of which target emissions.
"We're seeing the administration seeking to hammer the oil and gas industry," McGowen said at the Southeastern Association of Regulatory Utility Commissioners (SEARUC) annual meeting here.
She referred to it as "death by 1,000 cuts."
"From a political standpoint, we face a bit of an uphill climb," she said.
But with economy as the focus of this year's annual meeting, gas industry supporters came armed with statistics about job growth and economic development. A reliable electric grid and low bills are also major selling points, they said.
Southeast utility officials talk about natural gas in the same way they used to about another fuel: coal. The fossil fuel was the dominant fuel across the greater region, but many states have dramatically shifted away toward gas.
Yet, all of the states have fought hard against the wide range of federal environmental rules that are leading to widespread coal plant closures. All have sued to stop U.S. EPA's Clean Power Plan, which targets greenhouse gas emissions from existing power plants.
The region also once was resistant to adding natural gas in any significant way. While prices have been low, natural gas is prone to volatile swings while other sources of baseload fuel can remain more constant.
There also are a dearth of pipelines in the region.
Both remain major concerns for regulators and industry. The glut of shale gas will keep prices low, but that is expected to change as more states move toward natural gas as a fuel source.
Prices also will go up if there's not enough infrastructure to move the gas quickly to where it is needed. This is why more pipelines need to be built and approved quickly, instead of the opposite, officials say.
"We're going to have to have transmission lines and natural gas pipelines to continue to serve a growing region," said Stan Wise, a Georgia utility regulator who has a strong interest in pipeline safety and natural gas issues.
Two proposed pipelines in Georgia have been in the news for separate reasons. One was a 360-mile petroleum pipeline from South Carolina to Jacksonville, Fla. Kinder Morgan Inc. has shelved the project after the Georgia Legislature passed an eminent domain bill that targeted it.
The second pipeline is Sabal Trail, a 515-mile interstate natural gas pipeline that is a joint venture of Spectra Energy Corp., NextEra Energy Inc. and Duke Energy Corp. The pipeline would run through Alabama and southwest Georgia and into Florida, where Duke Energy Florida and NextEra's Florida Power & Light Co. would be the main customers.
Combating the drumbeat and the 'antis'
Wise said regulators and other elected officials need to tune out what he called "political correctness" and "sensitivity" when it comes to energy issues such as pipelines. He pointed at Democratic presidential candidate Bernie Sanders and his call for clean energy.
"You listen to the impact of what he's talking about, but they beat that drum ... and the media picks up, and they spin it," he said during an afternoon session on LNG. "You've got to have politicians, government entities standing between the utility and the ratepayer and not listening to the drumbeat, and getting it right."
He and others at the LNG session went after what they referred to as "antis," those who oppose natural gas because of methane emissions and other reasons. The industry needs to change its message to talk up the fuel's benefits instead.
"It's clearly a threat," said Alan Mosley, energy and logistics vice president for the JAX Chamber. "Combating it is transparency, facts, but we've got to come up with something that links it to our economic well-being."
http://www.eenews.net/energywire/2016/06/14/stories/1060038760
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US Shale Oil Production Forecast to Fall in July: EIA
Jun 13, 2016 | Platts
By Benjamin Morse
Oil output in the biggest producing shale areas in the US is forecast to decrease 118,000 b/d in July from June to 4.723 million b/d, according US Energy Information Administration estimates released Monday.
The decrease was in line with the precipitous fall in oils rigs operating in US shale. The rig count peaked in October 2014 at 1,609 and finished last week at 328, according to Baker Hughes data.
The steepest drop in production was expected in Texas' Eagle Ford shale where output is anticipated to shrink 58,000 b/d to 1.212 million b/d, followed by a 28,000 b/d decrease in North Dakota and Wyoming's Bakken shale oil to 1.024 million b/d, according to the EIA's Drilling Productivity Report.
The largest oil producing shale region in the US, the Permian basin of West Texas and New Mexico, is forecast to lose 10,000 b/d of production to 2.019 million b/d, the report said.
PRODUCTIVITY INCREASES
While production has continued to trend lower, the rigs still operating are forecast to produce more barrels per day than before as drilling techniques continue to improve.
In the Permian new-well oil production per rig is forecast to grow by 13 b/d to 493 b/d, the Bakken is expected to increase new-well output by 17 b/d to 832 b/d, with the Niobrara and Eagle Ford each expected to grow new-well production by 23 b/d to 915 b/d and 994 b/d, respectively.
SIGNIFICANT RIG ADDS NEEDED TO MAINTAIN PRODUCTION An EIA formula shows the Bakken would need to have 62 rigs operating, up from current 24 rigs, to maintain current production. The Permian basin would need to have 150 rigs, eight more than now. The Eagle Ford would require 89 rigs operating, from 26 currently and the Niobrara would need 31 rigs, 12 higher than its current rig count.
The rig counts are according to Baker Hughes weekly rig count released Friday.
This estimate does not include production from the completion of DUCs (drilled but uncompleted wells), and producers have said they would work off their DUC inventory before adding rigs.
DUC inventory has been on a downward trend since May 1, 2015, when it stood at 7,363, compared to 6,376 as of March 1, 2016, according to an S&P Global Platts analysis.
The slow completion of DUCs has moderated the overall US production decline, however "US crude oil production has fallen by more than 0.9 million b/d since April 2015 to an average of 8.7 million b/d in May 2016. Almost all of the production decline was in the Lower 48 onshore," EIA said it its latest Short-Term Energy Outlook on June 7.
EIA forecasts production to keep falling through Q3 2017 to an average of 8.1 million b/d before turning higher.http://www.platts.com/latest-news/oil/newyork/us-shale-oil-production-forecast-to-fall-in-july-21696535
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Nuclear Regulator's Web Apps Need Work -- IG
Jun 14, 2016 | E&E Energywire
By Blake Sobczak
The Nuclear Regulatory Commission should dust off and inventory its overlooked online tools in light of a fast-moving cyberthreat, the agency's inspector general found.
A security audit of NRC's web presence turned up at least 15 potential targets that the regulator had not accounted for, according to a report published yesterday. Each login page or administrative system could offer hackers an avenue for attack, even seemingly benign sites like a webcast for members of the public to tune into NRC meetings.
The inspector general said many NRC websites "may not be compliant" with its own cybersecurity standards, concluding that the agency "has not implemented adequate security measures to reduce the risk of compromise for their publicly accessible web applications." Investigators flagged two vulnerabilities with "a potential high impact" during fieldwork, forcing NRC to make some hasty repairs.
While NRC's most visible web presence could use work, a separate audit of classified information protections at the agency found no major problems.
NRC spokesman David McIntyre pointed out that "classified and safeguards information at the NRC are kept on separate, secured servers" not accessible through the internet.
In other words, if hackers stumbled upon an NRC network portal online and managed to break in, they wouldn't find the nation's most closely held nuclear secrets at their fingertips, according to the agency.
Still, the inspector general pointed out that "NRC is a regular target of cyber-attacks because its technical and other sensitive information is highly sought after by potential adversaries," even in unclassified settings.
Yesterday's report also found that many of NRC's cybersecurity standards for its public-facing websites hadn't been updated in over six years.
"The NRC process for maintaining standards was not followed as evidenced by changes in the threat environment that should have dictated an update," auditors said.
The agency watchdog carried out its investigation from last November through this April at NRC's headquarters in Rockville, Md., retaining the cybersecurity and management consulting firm Carson Inc.
http://www.eenews.net/energywire/2016/06/14/stories/1060038755
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Industry, Senate Republicans Decry Pipeline Delays
Jun 14, 2016 | E&E Greenwire
By Hannah Northey
Manufacturers, unions and trade groups bemoaned a recent string of rejections and delays of pipeline and export projects today, warning a Senate panel that growing demand for energy is butting up against growing anti-fossil pushback and rigorous state and federal permitting.
"We've got a math problem," Ross Eisenberg, vice president of the National Association of Manufacturers, told the Senate Energy and Natural Resources Committee.
Manufacturers' demand for natural gas is forecast to increase by 40 percent over the next decade, while U.S. gas supplies are expected to grow by 48 percent, Eisenberg said, citing two studies his trade group commissioned from IHS Economics.
While gas supplies are a sure thing, the uncertainty, Eisenberg said, revolves around whether there will be adequate pipeline capacity to get gas to consumers, including manufacturers that make everything from chili pepper to bricks as well as the U.S. Postal Service.
Eisenberg said it's possible to reverse flow on a number of pipelines to power needy manufacturers, but that won't negate the need for new pipes.
That's not the case, said Environmental Defense Fund's N. Jonathan Peress. The utility industries, pipeline developers and the manufacturing industry, he said, are pushing a narrative of pipeline scarcity when no such proof exists. Peress pointed to a "disturbing trend" of pushing pipeline capacity expansion to earn shareholder returns as pipeline developers, even if the projects aren't needed.
But industry panelists said delays are indeed pushing back projects, even hitting oil pipelines, according to Andrew Black, president of the Association of Oil Pipe Lines. "It's taking longer ... by a period of years," Black told Chairwoman Lisa Murkowski (R-Alaska).
The industry warning sparked a committee discussion about how to help the industry advance critical projects without trampling federal and state environmental protections.
Murkowski said there's "cognitive dissonance" among groups opposed to new pipelines, saying they likely decry high energy prices. "How can we expect affordable energy if we can't move energy?" she asked.
But ranking member Maria Cantwell (D-Wash.) said that while Congress can improve efficiencies in the federal pipeline permitting process, that shouldn't come at the cost of full and effective environmental reviews.
"We have to remember not to take shortcuts," she said.
Cantwell said she supports the Senate energy bill, S. 2012, which would boost coordination between the Federal Energy Regulatory Commission and state agencies that review pipeline proposals. But Cantwell said she wouldn't support language in a revised House bill that would give FERC only 90 days to complete its work.
"This is something we cannot do," Cantwell said.
Cantwell joined Sens. Elizabeth Warren (D-Mass.) and Angus King (I-Maine) in asking whether new technologies or market fixes -- not just new pipelines -- could be the answer.
They directed their questions toward the Environmental Defense Fund's N. Jonathan Peress, who said natural gas is needed to transition the nation toward a cleaner, lower-carbon future but without overbuilding. Peress in his testimony cited studies from RBN Energy LLC, which found pipelines surrounding the Marcellus Shale play are being overbuilt.
Murkowski questioned that assertion, but King saw its merit.
"It often occurs to me that we build energy infrastructure ... for the hottest day of the year or, in the case of gas, for the coldest day of the year," King said. "It's like building a church only for Christmas and Easter."
'Fringe movement'
The industry has seen a number of large projects snuffed out or pushed back in recent months.
Constitution Pipeline Co. LLC, for example, sued New York environmental regulators last month for refusing to grant the company a water permit (EnergyWire, May 17).
In April, Kinder Morgan Inc. canceled its $3.3 billion Northeast Energy Direct pipeline, saying it couldn't get enough customers to sign up for the project (EnergyWire, April 21).
Federal regulators in March rejected an application to build the Pacific Connector Gas Pipeline, a 232-mile gas feeder that would have connected the proposed Jordan Cove liquefied natural gas plant in southern Oregon to a point on the gas grid near the California border (EnergyWire, March 18).
A number of Republican senators today linked those project problems to the White House and opposition from environmental groups, even as the utility industry invests in gas to comply with new environmental regulations.
Republican Sen. Mike Lee of Utah pointed to U.S. EPA's Clean Power Plan and other rules that are boosting gas as coal-fired power plants and reactors close. The same environmental groups that support the climate goals oppose new gas infrastructure, he said.
"I'm at a loss on this one," Lee said.
The nation is facing an environmental movement that has set its sights on pipeline projects, he said. "It's a fringe movement, but it's a fringe movement not to be ignored," he said.
Sen. John Barrasso (R-Wyo.) blasted activists belonging to the group Beyond Extreme Energy for rallying outside FERC members' homes, calling it "dangerous."
Barrasso asked Peress why groups like EDF haven't publicly criticized such "troubling" and "dangerous" actions.
http://www.eenews.net/greenwire/2016/06/14/stories/1060038801
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Oregon U.S. Senators Critical of Response to Oil Train Derailment
Jun 14, 2016 | Natural Gas Intelligence
By Richard Nemec
Oregon's two U.S. senators on Thursday asked the head of the National Transportation Safety Board (NTSB) why a federal investigative team was not dispatched last weekend to the scene of an oil tanker train derailment in their state near the Columbia River Gorge.
Sens. Jeff Merkley (D-OR) and Ron Wyden (D-OR) said they were troubled by the federal agency's lack of involvement in the aftermath of 16 of 96 Union Pacific Railroad (UP) crude-hauling tank cars spilling oil and igniting in fires near Mosier, OR. No one was hurt, but the clean up continues this week.
Merkley and Wyden laid out their concerns in a four-page letter to Christopher Hart, NTSB chairman, contending that federal law requires that NTSB "investigate or have investigated" a railroad incident in which there is a death or substantial property damage. There are also a number of other criteria under which NTSB can inject itself into an investigation, according to the senators.
The accident site is being cleared of oil spillage and the tank cars, all of which are older C-1232 models, while community concerns and a wastewater treatment plant sewage pipeline damaged in the incident are both being resolved separately, a Sacramento, CA-based UP spokesperson told NGI's Shale Daily. The incident caused a lot of local consternation, although none of the people in the town of 440 were directly impacted by the incident (see Shale Daily, June 7).
"It should go without saying that crude-by-rail accidents, and others involving unit trains transporting Class 3 flammable liquids, are 'problems of a recurring character,'" Merkley and Wyden told Hart. "In response to a letter we sent on [two years ago], you provided information showing there had been 16 'significant crude oil and ethanol accidents' between October 2006 and February 2014."
The senators pointed out that the oil train derailment on June 3 caused closure for a time of the Interstate 84 highway, a major transportation corridor running parallel to the railroad tracks south of the Columbia River. This was all within a one-mile evacuation zone, which also included a school with 200 children. "Oil from the wreck leaked into a sewer treatment plant, forcing its closure," the senators said.
Their letter to Hart ended with a long list of questions seeking more specifics from the ongoing investigation. They asked for a response from the NTSB by July 5. In the meantime, UP plans to finish its preliminary investigation this week and submit a report to the Federal Railroad Administration; it had no comments about the NTSB's role or lack of a role in the incident.
A UP spokesperson at the scene Friday said the company was preparing for a community update meeting later that night and planned to wrap up remediation work this week. "All the oil has been removed or collected, and soil remediation is still ongoing," he said. Train traffic that resumed on the June 5 continues to be limited to 10 mph in the area.
The local wastewater treatment plant that was shut because of oil spill should be back online by the end of this week, the spokesperson said. Future oil train shipments will be reconsidered following Friday's community meeting, the spokesperson said.
Incidents like the Oregon oil tanker train derailment are more common than they once were, likely due to the overall rise of crude-by-rail shipments in recent years. Shipments of crude oil by rail have grown exponentially, mostly due to the fact that more U.S. crude is being produced in places like the Bakken Shale in North Dakota, where it must travel long distances to reach major market centers. Despite the recent decline in prices, shipments of crude oil in the first three months of 2016 were still almost eight times what they averaged in 2010.
http://www.naturalgasintel.com/articles/106746-oregon-us-senators-critical-of-response-to-oil-train-derailment
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Senate FY17 EPA Bill Includes Policy Budget Cuts, Riders but Boosts SRFs
Jun 14, 2016 | Inside EPA
By David LaRoss
Senate Republicans are pushing a fiscal year 2017 spending bill for EPA that would cut the agency's existing budget of $8.14 billion down to roughly $8.1 billion with what Democrats say would be 10 percent cuts to major environmental policy areas and includes riders barring some rules, though the bill does propose boosting water infrastructure funding.
The Senate Appropriations Committee's interior panel marked up the legislation June 14 and advanced it to the full funding committee by voice vote. A GOP summary of the bill says, “Funding is focused on returning the agency to its core mission of environmental cleanup instead of writing costly rules that will harm the economy.”
Although EPA would get a proposed $113 million hike to the clean water and drinking water state revolving funds (SRFs) with the legislation, the bill would still lead to an overall $31.2 million funding cut at the agency because other regulatory programs face significant reductions in funding.
EPA's overall budget under the bill would be about $170 million less than President Obama's proposal to fund the agency at $8.27 billion, but $112 million more than the House's proposal of $7.98 billion.
The Senate bill summary notes that it also includes policy provisions that would block implementation of EPA's Clean Water Act (CWA) jurisdiction rule and prevent it from issuing its upcoming financial assurance mandates for the hard-rock mining industry under the Superfund law.
The full text of the bill was not available at press time, but is expected to be released after a full Senate Appropriations Committee markup on June 16.
The list of riders in the draft bill appears to be smaller than what the House GOP has proposed. But Sen. Tom Udall (D-NM), ranking member on the appropriations interior subcommittee, said during the markup that Democrats consider them “poison pills” that will prevent the bill's passage.
“Democrats have been clear, the White House has been clear -- we are not prepared to gut environmental laws in the name of getting a spending bill passed,” Udall said.
Appropriations Bill
According to the summary, the bill would boost funding for the SRFs by $113 million over the FY16 level of $2.25 billion.
Sen. Lisa Murkowski (R-AK), chairman of the interior spending panel, said during the markup that the proposed legislation "fully met" the White House's FY17 budget request for a $157 million boost to the drinking water SRF, which would bring it to $1.02 billion, while holding the clean water SRF nearly at FY17 levels. Obama had sought a cut to that account, down to $979 million, in order to pay for the drinking water increase.
“The Clean Water and Drinking Water State Revolving Funds receive more than $2.37 billion, an increase of $113 million over the FY2016 enacted level and $370 million above the administration’s request,” the Senate summary says.
By contrast, the House bill would raise funding for the drinking water SRF $50 million above the White House request, to $1.07 billion, but would also cut the clean water SRF to exactly $1 billion.
Other than the SRFs, the summary only gives a definite funding level for one account -- the agency's nascent Water Infrastructure Finance and Innovation Act (WIFIA) loan program. The panel would allocate $30 million for WIFIA to begin operations in FY17, above the administration's $20 million request but below the House level of $45 million.
'Focused Resources'
Murkowski said during the markup that the bill “focused resources on programs that do concrete things to improve the quality of the environment for the public,” but did not specify how much was cut from or added to accounts that fund rulemakings, agency science and technology, enforcement, and other areas.
A separate summary by the appropriations committee's Democrats says the bill includes “10 percent reductions to EPA programs supporting clean air, climate, and civil and criminal enforcement as well as a 50 percent reduction to environmental education programs.”
However, Udall in his statement at the markup praised the bill's funding for EPA toxics programs, saying it "helps the Environmental Protection Agency begin its historic overhaul of the Toxic Substances Control Act” after Congressapproved legislation reforming the chemicals law.
Udall recently said that he doubted lawmakers would give EPA any major new funding to implement the law because the agency likely has adequate existing funds for it.
http://insideepa.com/daily-news/senate-fy17-epa-bill-includes-policy-budget-cuts-riders-boosts-srfs
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WOTUS Arguments Will Fall to Next Administration
Jun 14, 2016 | PoliticoPro - Whiteboard
By Annie Snider
A federal appellate court laid out a schedule today that will put the legal defense of the Obama EPA's Waters of the U.S. rule in the hands of the next administration.
In a filing today, the Sixth Circuit Court of Appeals said briefing in the case challenging WOTUS, also known as the Clean Water Rule, is not scheduled to wrap up until February 2017, leaving the next administration to handle oral arguments in the high-profile case over the reach of the Clean Water Act. It is widely expected to end up at the Supreme Court.
But the Obama administration still has time to lay key groundwork. The government's main brief isn't due until November 30, so the Obama Justice Department has some time to craft a strategy based on whether Hillary Clinton or Donald Trump wins the White House.
The Obama administration will get a say over which documents make it into the administrative record, which serves as the legal playing field. That's particularly important in the case over WOTUS because leaked Army Corps of Engineers memos show that the agency's technical and legal experts raised some major concerns with the rule. Those documents could be a powerful weapon for opponents if they are allowed into the record.
Briefing on the administrative record is scheduled to wrap up by the end of July and the court said it will strive to rule on that issue within 30 days.
https://www.politicopro.com/energy
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The Supreme Court’s Wake-up Call to Congress on Clean Water Act Jurisdiction
Jun 14, 2016 | The Hill - Congress Blog
By Larry Liebesman and Maj. Gen. (ret) Don Riley
Last month, a unanimous Supreme Court issued a decision with significant implications for federal clean water laws and especially the Obama Administration’s “Waters of the U.S.” regulation. The ruling could energize Congress’ efforts to block the rule.
On May 31, the Court held that landowners could challenge an Army Corps of Engineer’s assertion of Clean Water Act jurisdiction over a parcel of land in Minnesota. For Congress, what might be even more significant than the Court’s unanimity is Justice Anthony Kennedy’s notable concern over the Clean Water Act’s broad reach.
As background, the case involved an application by the Hawkes Company for a permit to mine peat at a site in northern Minnesota more than 120 miles from the Red River. Pursuant to the Clean Water Act, the Army Corps of Engineers issued a Jurisdictional Determination (JD) that the site contained wetlands regulated under the Act.
A federal district court dismissed Hawke’s challenge to the Corps’ determination but the Eighth Circuit reversed.
In upholding the Eighth Circuit, the Supreme Court rejected the Corps’ argument that its determination was not “final” and that Hawkes had adequate alternatives to challenge the determination during an enforcement action or at the end of a permit process
The Court relied on longstanding precedents holding that the Corps’ determination met the two conditions for “finality,” namely that it (1) marked the “consummation of the agency decision-making process “ and (2) it “determined the rights and obligations or from which legal consequences flowed. “
In so holding, the court followed its 2012 ruling in Sackett v. U.S., holding that landowners are entitled to immediate judicial review of EPA-issued compliance orders.
Significantly, Justice Roberts recognized the difficult position created by the Corps’ determination, stating, “The Clean Water Act imposed substantial criminal and civil penalties for discharging any pollutant into water covered by the Act without a permit [and] the costs of obtaining such a permit are significant.”
The Court also premised its holding on a 1989 Memorandum between the Corps and EPA which the Government treated as binding on the agencies, creating a five year “safe harbor” for a property owner from possible enforcement proceedings.
But it is Justice Kennedy’s concurrence that deserves special notice due to its implications for the Corps and the EPA’s controversial Waters of the United States (WOTUS) rule. That rule, which purported to apply Justice Kennedy’s 2006 “significant nexus” concurring opinion in Rapanos v U.S., asserts jurisdiction over large areas of land many miles from traditionally navigable waters. Thirty states have sued and the Sixth Circuit has issued as nationwide stay of the rule.
While not directly addressing the Administration’s WOTUS rule, Justice Kennedy last month went out of his way to address regulatory overreach, writing that the Clean Water Act’s “reach is notoriously unclear [and] remains a cause for concern.” He added that the Act “continues to raise troubling questions regarding the Government’s power to cast doubt on the full use and enjoyment of private property….”
These comments suggest that Justice Kennedy might have concerns that the Administration’s WOTUS rule, particularly its broad and uncertain sweep, misinterprets his “significant nexus” opinion in the Rapanos case.
The Court’s decision also has deep implications for the Army Corps of Engineers administration of the Clean Water Act Section 404 permit program. First, the Corps will need to ensure that its administrative record fully supports any determination findings in the likely event of future lawsuits, which will further strap the Agency’ s resources
Second, the Corps could also increase the use of preliminary jurisdictional determinations that are clearly not final agency action in return for even more expedited review of permit applications.
Third, the Corps could also modify or rescind its 1989 EPA Memorandum or revise its regulations on the determination process. But that would have the perverse effect of increasing property owners’ risk, as they would potentially lose their current “safe harbor.”
Most likely, last month’s decision will further energize Congressional efforts to block WOTUS implementation through appropriations riders and other means. Given Justice Kennedy’s comments and the fact that Hawkes was a unanimous ruling, WOTUS opponents have a more plausible case that WOTUS has fatal flaws.
Larry Liebesman and Maj. Gen. (ret) Don Riley are executives with Dawson & Associates, which specializes in federal water policy. Liebesman is a former environmental litigator at the U.S. Justice Department. Gen. Riley was Deputy Commanding General of the U.S. Army Corps of Engineers from 2008-2010.
http://thehill.com/blogs/ballot-box/283341-the-supreme-courts-wake-up-call-to-congress-on-clean-water-act-jurisdiction
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California's Cap-and-Trade Program Faces Daunting Hurdles to Avoid Collapse
Jun 14, 2016 | Los Angeles Times
By Chris Megerian and Ralph Vartabedian
The linchpin of California’s climate change agenda, a program known as cap and trade, has become mired in legal, financial and political troubles that threaten to derail the state’s plans to curb greenhouse gas emissions.
The program has been a symbol of the state’s leadership in the fight against global warming and a key source of funding, most notably for the high-speed rail project connecting San Francisco and Los Angeles.
But the legality of cap and trade is being challenged in court by a business group, and questions are growing about whether state law allows it to operate past 2020. With the end of the legislative session in August, Gov. Jerry Brown, lawmakers and interest groups of all stripes are laying the groundwork for what could become a battle royal over the future of California’s climate change programs.
Unless the state acts, “the whole system could fail,” said Senate leader Kevin de León (D-Los Angeles). “If that happens, we could lose an entire stream of revenue to make our communities more sustainable.”
California received an unwelcome reminder of cap and trade’s precarious situation last month.
The program functions by capping how much greenhouse gas can be emitted into the atmosphere and requiring companies to obtain permits, each allowing 1 metric ton of emissions. Those permits can be purchased at auctions or traded in a market, a system intended to provide a financial incentive for businesses such as power plants, oil refineries and manufacturers to reduce emissions.
By selling the permits, the state generates revenue that can be spent on other initiatives that reduce greenhouse-gas emissions, such as weatherizing homes and helping low-income residents buy cleaner cars. The bullet train is the biggest recipient, getting 25% of the cap-and-trade funds.
During the most recent auction in May, only 11% of the permits offered for sale were purchased.
Analysts suggested that legal uncertainty around cap and trade has damaged faith in a system that, like other markets, requires investors’ confidence to operate smoothly. They also said corporations and speculators are holding more permits than currently needed to cover the amount of greenhouse gas emissions in the state, a supply-and-demand problem that has been growing in every auction over the last year and could continue to choke revenue through 2017.
“The market is clearly in a position of cumulative surplus,” said Harry Horner, an analyst at CaliforniaCarbon.info.
Hanging in the balance is funding for the country’s largest infrastructure project, the $64-billion bullet train championed by Brown. Two years ago, as the governor struggled to get construction rolling, he turned to cap and trade to plug a shortfall in funding.
The latest auction produced just $2.5 million of the $150 million expected for the project and drove the price of each permit to the minimum set by the state.
If revenue remains weak, the bullet train could run out of money needed next year to match a federal grant. The state rail authority is depending on annual cap-and-trade revenue of $500 million to build the first operational segment from San Jose to Shafter, a plan that would probably fall apart if the auctions don’t recover.
Officials at the California Air Resource Board, which runs cap and trade, caution against jumping to conclusions that their system is facing major problems.
“One auction doesn’t tell you a lot about the supply and demand over a longer period of time,” said Michael Gibbs, a senior board official.
But there are still uncertainties in the market because companies were encouraged to build up a surplus of permits and no one is entirely sure how many they will ultimately need.
Frank Wolak, a Stanford University economist who has advised the state, suggested an optimistic scenario — polluters might be cutting their emissions more than was expected and don’t need as many permits.
“To the extent that not all the permits are being sold, that is a success of the program,” he said.
Either way, the result is a financial problem. Although the state could tap a $500-million reserve of cap-and-trade funds to keep bullet train construction rolling, it could be hard for the state to show that future revenue will be stable enough to secure bonds, a key part of the plan for financing high-speed rail.
Meanwhile, clean energy businesses and environmental justice groups are counting on cap and trade to provide financial support for their products and their communities. And advocates want to ensure California maintains its reputation as a global leader on climate change.
“Now is a critical time to steady the ship,” said Alex Jackson, a San Francisco-based lawyer for the Natural Resources Defense Council. “There is no reason to jump ship, but the headwinds around the program show there’s a lot of uncertainty.”
One of the people with the most at stake is Brown, who has made climate change central to his political mission. But he has not outlined how he wants to address the issue.
“We’re looking at it very carefully,” he said recently. “There’s more than one way to handle it.”
Brown and his allies are hemmed in by political challenges on multiple fronts. There are Democrats skeptical of environmental initiatives because of potential costs for low-income communities, Some Republicans are opposed to increasing costs on businesses and oil companies seeking leverage for loosening other pollution regulations.
At this point, cap and trade “does not have enough legislative constituencies to continue,” said Assemblyman Sebastian Ridley-Thomas (D-Los Angeles).
Much of the debate over the program has focused on funding, reflecting the degree to which cap and trade has been viewed as a revenue generator rather than just a series of environmental regulations.
The cap-and-trade program grew out of a measure signed by Gov. Arnold Schwarzenegger in 2006. The law set goals for reducing greenhouse gas emissions to 1990 levels by 2020.
“The name of the game wasn’t to raise revenues,” said Dean Florez, a former Democratic state senator who is now a member of the Air Resources Board.
But since then, lawmakers and the governor have relied on the program to pay for a broad swath of initiatives, increasing their reliance on the money. Even Republicans who oppose cap and trade have suggested using the funding to repair dilapidated roads.
That revenue is what’s facing a legal assault from the California Chamber of Commerce.The organization filed a lawsuit nearly four years ago arguing that cap and trade was unconstitutional because it functions like a tax, and the law was not passed by a two-thirds majority in the Legislature needed to approve taxes.
State officials have rejected that argument, saying the program falls within their regulatory power. But the lawsuit received new attention this spring when an appeals court issued a series of pointed questions that led some analysts to suggest they're preparing to rule against the state.
That would be a blow to climate efforts. Officials have urged other governments to join the market, and the program has been closely studied by Chinese leaders who are launching their own effort.
“If we cease to have [cap and trade], that’s going to send a very loud message to the rest of the world and one we may not want to send,” said Michael Wara, a Stanford law professor.
State Sen. Fran Pavley (D-Agoura Hills), who wrote the 2006 law, said she expected cap and trade to survive a legal challenge, like so many other environmental programs before it.
“Every one of these policies have been sued along the way,” she said. “None of them have been successful.”
But there’s also no consensus on whether a new law is needed to extend cap and trade past 2020. The Air Resources Board said it had the authority to keep going, but the legislative counsel’s office disagrees.
Pavley wants to see a new law passed to make it clear that lawmakers stand behind cap and trade and the state’s environmental goals, and she has started having conversations about pushing the issue before the end of the legislative session in August.
But to protect the program against legal challenges like the one it’s facing now, lawmakers may need to extend it with a two-thirds vote. Hitting that threshold would require Republican help, not to mention support from business-friendly Democrats.
Getting there would probably require trade-offs — ones that environmentalists don’t want to make.
Oil companies and their allies are angling to use the debate around cap and trade to dispense with a different regulation known as the low-carbon fuel standard, which requires the industry to produce cleaner gasoline.
“This issue opens up a door to try and have those discussions,” said Rob Lapsley, president of the California Business Roundtable, which represents the state’s largest corporations.
If concerns tied to cap and trade continue to snowball, lawmakers could find themselves considering a massive piece of legislation to address all of them at the end of the session.
“That’s where the magicians come out and wave their wands,” said state Sen. Bob Huff (R-San Dimas).
http://www.latimes.com/politics/la-pol-sac-climate-change-challenges-20160614-snap-story.html
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