Preview Newsletter
AM ACC 6/1/2018
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(ACC Mentioned) US Businesses Express Alarm as Tariffs Push up Steel Costs
Jun 1, 2018 | Financial Times
By Ed Crooks
US businesses have warned there is a risk of severe damage from the tariffs on steel and aluminium announced by the Trump administration and the retaliatory measures launched by other countries. -
(ACC Mentioned) US Steel, Aluminium Tariffs Risk Retaliation from Allies – ACC
May 31, 2018 | ICIS
By David Haydon
The American Chemistry Council (ACC) on Thursday warned of the potentially damaging economic effects that will result from steel and aluminium tariffs, which US President Donald Trump recently augmented to include Canada, Mexico and the EU. -
(ACC Mentioned) Plastics Groups Call Trump Steel Tariffs 'Dangerous, Disruptive'
May 31, 2018 | Plastics News
By Steve Toloken
Plastics industry business groups pushed back hard against the Trump administration's May 31 decision to move forward with tariffs on steel and aluminum from Canada, Mexico and Europe, calling it "dangerous" trade policy that will raise prices and cost industry jobs. -
(ACC Mentioned) Newest Steel Tariffs Could Undercut Chemical Projects: ACC
May 31, 2018 | Platts
By Kristen Hays
The trade group for US chemical manufacturers Thursday decried the Trump administration's decision to impose steel and aluminum tariffs on Canada, Mexico and the European Union, saying more-expensive building materials could undercut advantages that prompted companies to build... -
(ACC Mentioned) Texas Industry Fears Economic Hit from Trump Tariffs
May 31, 2018 | Houston Chronicle
By James Osborne
The Texas economy, rich in companies that rely on foreign steel and aluminum, is likely to take a hit from the Trump administration’s decision to impose tariffs on the metals produced by some nation’s largest trading partners, including Mexico, Canada and the European Union. -
(ACC Mentioned) Industry Groups Take Familiar Battle Lines in Wake of New 232 Tariffs
Jun 1, 2018 | Inside US Trade
By Jack Caporal
Industry and business groups have taken now-common sides for and against the Trump administration’s decision to impose Section 232 tariffs on steel and aluminum from Mexico, Canada and the European Union starting June 1, with downstream manufacturers and groups susceptible... -
(ACC Mentioned) Remade Under Scott Pruitt, EPA's Science Advisory Board Includes More Industry-Friendly Voices
Jun 1, 2018 | USA Today
By Ledyard King
The latest chapter of Scott Pruitt's ambitious remake of the Environmental Protection Agency took place Thursday in a windowless conference room of the sprawling Washington Plaza hotel. -
(ACC Mentioned) Embracing a Circular Economy
Jun 1, 2018 | Chemical Engineering Online
By Dorothy Lozowski
Last month, for the first time, U.S. plastic resin producers publicly committed to measurable targets toward complete recovery and recycling of plastic packaging. -
Energy Groups, Republicans Bash Trump over Tariffs
May 31, 2018 | E&E News PM
By Hannah Northey
President Trump drew fire today from U.S. allies, Republicans and a large slice of the energy sector after announcing sweeping tariffs on steel and aluminum imports from friendly shores. -
(ACC Mentioned) Chemical Info Could Be Slow to Reach States, EMTs Under EPA Plan
May 31, 2018 | BNA Daily Environment Report
By Sam Pearson
Industry and health advocacy organizations are watching closely as the EPA adds new tools so that, during emergencies, local authorities and first responders can access chemical trade secrets previously kept in-house. -
(ACC Mentioned) Chemical Found in Plastic Could Harm Children’s Heart Functions, Professor Finds
May 31, 2018 | GW Hatchet
By Sarah Roach
A pediatrics professor led new research finding a chemical commonly used to make plastic water bottles and DVDs can adversely affect children’s heart functions, Chemical Watch reported Thursday. -
EPA Sets Interim Limits on Hypochlorite Bleach to Reduce Degradation to Perchlorate
May 31, 2018 | Environmental Defense Fund
By Tom Neltner
On May 1, 2018, Environmental Protection Agency’s (EPA) Office of Pesticide Programs (OPP) made an interim pesticide registration decision[1] for hypochlorite bleach used to disinfect drinking water. -
Interior Receives First Application for Work in Arctic National Wildlife Refuge
May 31, 2018 | The Hill - E2 Wire
By Josh Delk
The Interior Department is pushing back on the first permit application for development work in the newly-opened Arctic National Wildlife Refuge amid criticism from environmental groups. -
Oil, Gas Drilling in Arctic Refuge Divides Alaskans
May 31, 2018 | BNA Daily Environment Report
By Jill Burke
Plans to sell oil and gas leases on the Alaskan coastal plain home to the Arctic National Wildlife Refuge that could yield $1.8 billion intensifies a divide among communities over whether to proceed with the exploration project. -
Florida Senator Demands Answers on Interior's Offshore Drilling Plan
Jun 1, 2018 | The Hill - E2 Wire
By Miranda Green
Florida Sen. Bill Nelson (D) is pushing the Interior Department to answer questions about the future of offshore drilling in his state. -
Get Used to Bottleneck ‘Blowouts’ in Permian, Apache CEO Says
May 31, 2018 | BNA Daily Environment Report
By Alex Nussbaum and Alix Steel
The pipeline shortages now hammering Permian shale producers are likely to be a recurring theme in the coming years, Apache Corp.’s chief executive officer is warning. -
Bakken Natural Gas Flaring High Priority for North Dakota, Industry
May 31, 2018 | Natural Gas Intelligence
By Richard Nemec
Record associated natural gas production from the Bakken Shale's continuing oil boom in North Dakota remains a top concern for both the industry and the state, executives said last week. -
FERC Partly Grants Rover Natural Gas Pipeline Request, Allows Full Service on Mainline, Start of Supply Conne
Jun 1, 2018 | Platts
By Maya Weber
The US Federal Energy Regulatory Commission partly granted Rover Pipeline's request to bring additional segments into service Thursday morning, but held off on giving the go-ahead for two key laterals where restoration is ongoing. -
Editorial: Texas Should Learn from West Explosion, Even If EPA Won’t
Jun 1, 2018 | Austin American-Statesman
By Editorial Board
After 15 people died in the 2013 fertilizer plant explosion in West, after at least seven first responders became ill from the fumes at last year’s Arkema chemical plant fires outside Houston, after four contractors were hurt in an April explosion at an oil refinery in Texas City... -
Federal Assessment Finds ‘Gaps’ in Preparation for Electric Grid Attacks
May 31, 2018 | The Hill - E2 Wire
By Morgan Chalfant
An assessment released by the departments of Energy and Homeland Security this week finds that there are shortfalls preventing the energy sector from improving its ability to respond rapidly in the event of a major cyberattack that disrupts the electric grid. -
Energy Grid Isn’t Insured Enough to Handle a Catastrophic Hack
May 31, 2018 | BNA Daily Environment Report
By Naureen S. Malik
Insurers are limiting how much coverage energy companies can buy to protect themselves against a major attack by hackers, potentially leaving investors, customers, and taxpayers on the hook for sizable losses. -
EPA's Push to Overhaul NAAQS Poses Test for 'Cooperative Federalism'
May 31, 2018 | Inside EPA
By Stuart Parker
EPA's push to overhaul and streamline the national ambient air quality standards (NAAQS) process will pose a major test for Administrator Scott Pruitt's pledge to give states more power over environmental decisions, as some states welcome new NAAQS compliance flexibility... -
SAB Votes to Review EPA's Science, Emissions Rules in Sign of 'Rebuke'
Jun 1, 2018 | Inside EPA
By Doug Obey
EPA advisers have voted to review the science underlying agency rules aimed at rolling back a suite of Obama administration's greenhouse gas and emissions regulations, as well as a controversial proposal to require that major rules be based on publicly available science... -
The Paris Agreement’s Emissions Goals May Be in Trouble, with or Without U.S. Participation
Jun 1, 2018 | Washington Post
By Johannes Urpelainen
Last June, President Trump announced that the United States would withdraw from the 2015 Paris agreement on climate change. How are the Paris goals looking, a year later?
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(ACC Mentioned) US Businesses Express Alarm as Tariffs Push up Steel Costs
Jun 1, 2018 | Financial Times
By Ed Crooks
US businesses have warned there is a risk of severe damage from the tariffs on steel and aluminium announced by the Trump administration and the retaliatory measures launched by other countries.
Business groups said the decision to impose tariffs on imports from US allies including Canada and the EU could disrupt the global trading system, curtail investment and lead to job cuts.
In a statement that typified the alarmed reaction, the Coalition of American Metal Manufacturers and Users said: “Restricting the raw material supply in the US and imposing tariffs on imports from our closest trading partners places American manufacturers directly in harm’s way.”
Tariffs imposed on other countries earlier this year and the anticipation of the Trump administration’s action this week have already resulted in steep cost increases for US steel users. Benchmark steel prices have this year risen 2 per cent for north-west Europe and 8 per cent for south-east Asia, but 37 per cent in the US, according to S&P Global Platts. The benchmark US aluminium price is up 12 per cent this year.
The administration announced on Thursday that the US would begin levying tariffs on steel and aluminium from economies including the EU, Canada and Mexico, which had been given a temporary reprieve when the administration’s plans were first set out in March. They will face a tariff of 25 per cent on steel and 10 per cent on aluminium.
Those three economies accounted for 44 per cent of all US steel imports in the first quarter of 2018.
Canada and Mexico immediately responded with detailed plans for tariffs on imports from the US, hitting products including pork, apples, yoghurt and toilet paper. Jean-Claude Juncker, European Commission president, said the EU also planned retaliatory tariffs.
The group Farmers for Free Trade said the administration’s announcement “opens the floodgates to billions in new tariffs on American agriculture”, pushing many US farms “to the breaking point” as they are shut out of international markets.
The Trump administration’s decision to widen the tariffs was welcomed by steel producers. Tom Gibson, president of the American Iron and Steel Institute, thanked President Donald Trump “for his actions to ensure a strong American steel sector that is fundamental to our national and economic security”.
However, industries that use steel expressed disappointment and concern. The car and truck industry, which accounted for 27 per cent of US steel demand last year, was threatened by a loss of international competitiveness, the Alliance of Automobile Manufacturers said.
Matt Blount of the American Automotive Policy Council, an industry group, said the tariffs would “undermine the global competitiveness of the US auto industry”.
The chemicals industry is another heavy user of steel, with a wave of new plants planned and under construction in the US to take advantage of the low-cost natural gas released by the shale boom. Sasol, the South African fuels and chemicals group, has said it was installing 58,400 tonnes of steel at its Lake Charles Chemicals Project in Louisiana.
Cal Dooley, president of the American Chemistry Council, said increased steel costs could force the delay or abandonment of billions of dollars worth of other projects that had been planned.
In some cases, increased steel costs are being passed on to customers. Rajesh Kalathur, chief financial officer of Deere, the agricultural and construction equipment company, told analysts on a call last month that material costs had exceeded the company’s forecast for the year, “due largely to inflation in US steel prices”. But he added that demand for the company’s products was strong, and that he was confident that a combination of price increases and cost reductions would “more than offset inflation” in steel.
Other companies will find it more difficult. Anthony DiSilvestro, chief financial officer of Campbell Soup, warned analysts recently that the company was seeing “an acceleration in cost inflation”, in part because of the tariffs. The company could not say how quickly it would be able to pass those cost increases on to customers, he added, because it was “a very challenging environment out there today”.
An earlier tariff on steel imports imposed by then-president George W Bush was estimated to have cost 200,000 jobs, according to a study backed by steel-using industries. Other estimates were much smaller at about one-tenth of that. However, the tariffs were relatively shortlived, being abandoned after 21 months at the end of 2003 after pressure from the EU.
Many US businesses have expressed support for the Trump administration’s objective of tackling overcapacity in steel and aluminium worldwide, created principally by China, but criticised the use of tariffs as a way to address it.
The steel and aluminium tariffs are being imposed at a time when other trade restrictions are looming in the US, including possible new duties on cars and measures against China in retaliation for what Mr Trump has described as a campaign to steal American technology.
Some businesses said they were still hoping to avoid a trade war. Dennis Muilenburg, chief executive of Boeing, which is a large exporter to China, told The Street on Thursday: “Even though there is talk of tariffs we are hoping we will find a solution in between, and I think the ongoing discussion between country leadership has been productive.”
Additional reporting by Patti Waldmeir, Andrew Edgecliffe-Johnson and Shawn Donnan
https://www.ft.com/content/f174d106-6518-11e8-90c2-9563a0613e56
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(ACC Mentioned) US Steel, Aluminium Tariffs Risk Retaliation from Allies – ACC
May 31, 2018 | ICIS
By David Haydon
The American Chemistry Council (ACC) on Thursday warned of the potentially damaging economic effects that will result from steel and aluminium tariffs, which US President Donald Trump recently augmented to include Canada, Mexico and the EU.
“Today’s announcement to levy steel and aluminium tariffs against three of our closest allies and trading partners will disadvantage US chemical manufacturing and put our country’s manufacturing renaissance at risk," ACC CEO Cal Dooley said. Dooley warned the decision will also invite retaliation, which will in turn threaten the viability of trade agreements like NAFTA.
The 25% steel tariff and the 10% aluminium tariff are effective at midnight Eastern time (04:00 GMT on Friday).
"When these tariffs go into effect on Friday, trains arriving to the US from Mexico and Canada will be carrying metals that are 25% more expensive than when they left the station just a few days ago," Dooley said.
Trump first signed tariff proclamations in March, initially excluding Canada and Mexico, two of the largest sources of imported steel to the US.
The chemical industry has repeatedly criticised the move, stating that steel and aluminium tariffs would increase costs for infrastructure projects, ultimately making US chemical products less competitive globally.
"The increased costs could force the delay, abandonment, or even cancellation of billions of dollars of chemical production facility investments that have been announced over the last ten years," Dooley said. "Downstream industries like the automotive sector, which relies on both chemicals and metals, will feel the crushing impact of the tariffs as well."
The American Petroleum Institute (API) said that the tariffs could threaten production of natural gas liquids (NGLs) as well as oil and natural gas.
Industry groups including the ACC, the API and the Interstate Natural Gas Association of America (INGAA) have requested exemptions from the tariffs.
(Updates in first, second, fourth, seventh paragraphs with ACC response and eighth paragraph with API response)
https://www.icis.com/resources/news/2018/05/31/10226839/us-steel-aluminium-tariffs-risk-retaliation-from-allies-acc/
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(ACC Mentioned) Plastics Groups Call Trump Steel Tariffs 'Dangerous, Disruptive'
May 31, 2018 | Plastics News
By Steve Toloken
Plastics industry business groups pushed back hard against the Trump administration's May 31 decision to move forward with tariffs on steel and aluminum from Canada, Mexico and Europe, calling it "dangerous" trade policy that will raise prices and cost industry jobs.
"The Trump administration's decision today to impose tariffs on imports of steel and aluminum from Mexico, Canada and the [European Union] — America's strongest trading partners — will benefit America's trade rivals and cost American jobs, plain and simple," said Bill Carteaux, CEO of the Washington-based Plastics Industry Association.
"We urge President [Donald] Trump and his administration to reconsider this dangerous, disruptive approach to trade policy," he said, adding that the tariffs would particularly hit mold makers since much of the steel they use comes from the EU and can't be sourced in the United States.
"These tariffs could quite simply put these companies at risk of going out of business, all while increasing costs that will be felt throughout the domestic supply chain," Carteaux said. "American manufacturers need stable, consistent trade policies and should not have to suffer constraints due to a trade war."
Similarly, the head of the American Chemistry Council said the tariffs "have the potential to threaten U.S. economic security" and hurt planned chemical and plastics industry investments of nearly $200 billion, much of it enabled by shale gas feedstocks that are transforming the U.S. into a low-cost producer.
"Today's announcement to levy steel and aluminum tariffs against three of our closest allies and trading partners will disadvantage U.S. chemical manufacturing and put our country's manufacturing renaissance at risk," said ACC CEO Cal Dooley. "The unilateral move will also invite retaliation and threaten the viability of trade agreements like the North American Free Trade Agreement."
Carteaux also expressed concern the tariffs against Canada and Mexico could "poison the well" in the ongoing NAFTA negotiations.
ACC noted that the EU has already threatened to retaliate against $500 million in U.S. chemical exports.
The chemical and plastics resin sectors have been banking on shale gas leading to significant growth in exports, expanding its trade surplus from $33 billion last year to $73 billion in 2022, ACC estimates.
"Retaliation by our trading partners will curtail U.S. exports and erode the $194 billion in chemical industry investments that are predicated on the U.S. being able to export to the countries targeted by these actions," Dooley said.
The resin sector faces a similar risk in the ongoing Chinese trade dispute. ACC estimates that 40 percent of Beijing's $50 billion in retaliatory tariffs are directed at U.S. chemical and plastics exports.
"We anticipate other trading partners to target chemicals as well," Dooley said.
But the Trump Administration and its allies in manufacturing argue that the tariffs are needed on national security grounds, to protect the steel and aluminum manufacturing capacities in the United States.
Media reports quoted U.S. Commerce Secretary Wilbur Ross as saying that increasing imports are a threat to the steel and aluminum sectors. Government and private analysts say the root problem is a large global overcapacity of steel production, particularly in China.
Ross also linked economic and military security.
"Without a strong economy, you can't have a strong national security," Ross said, noting that he was open to continued talks with all the countries targeted in the tariffs, which take effect at midnight May 31.
http://www.plasticsnews.com/article/20180531/NEWS/180539971/plastics-groups-call-trump-steel-tariffs-dangerous-disruptive
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(ACC Mentioned) Newest Steel Tariffs Could Undercut Chemical Projects: ACC
May 31, 2018 | Platts
By Kristen Hays
The trade group for US chemical manufacturers Thursday decried the Trump administration's decision to impose steel and aluminum tariffs on Canada, Mexico and the European Union, saying more-expensive building materials could undercut advantages that prompted companies to build a slew of petrochemical facilities in Texas, Louisiana and Pennsylvania.
"When these tariffs go into effect on Friday, trains arriving to the US from Mexico and Canada will be carrying metals that are 25% more expensive than when they left the station just a few days ago," American Chemistry Council CEO Cal Dooley said in a statement. "The impacts will be felt immediately in the form of higher prices for chemical manufacturers who rely on these imports to expand or build new production facilities, many of which are under construction at this very moment."
Eight new steam crackers and 13 new polyethylene plants are starting up in Texas and Louisiana from 2017 through 2019 in light of the massive bounty of cheap ethane to emerge from the natural gas shale boom. Recent gains in oil prices have boosted that advantage, as most crackers outside of North America run largely on naphtha, which is tied to oil prices, while ethane is more competitive because its pricing is tied to natural gas.
Of those, three of the crackers and seven of the polyethylene plants have started up. More infrastructure is planned to start up in 2020 and beyond, including Total's new cracker under construction in Port Arthur, Texas, and Shell Chemical's petrochemical complex under construction in southwestern Pennsylvania.
Shell spokesman Ray Fisher said Thursday that, based on the company's "current conversations and understanding," a commitment exists between the energy industry and the Trump Administration "to work through the implementation and application of the tariffs. Our goal is to better understand the specific parameters and what, if any, exemptions might apply to Shell's current and future projects."
Individual companies can seek exemptions to tariffs on materials, but the application process can be lengthy, requiring separate requests for materials that may differ in makeup, rather than a single request for varied types.
The US first imposed 25% tariffs on steel and 10% tariffs on aluminum imports in March, but granted exemptions to Canada, Mexico and the EU. Canada is the largest exporter of steel to the US, and the EU is the US' largest trading partner.
All three responded swiftly with plans or threats to impose taxes on US goods. The EU's list of targets includes corn, cranberries, cotton bedding and clothing, types of stainless steel, iron or steel containers, appliances, canoes, whiskey and playing cards. Mexico's list includes flat steel, lamps, pork products, apples, grapes and some cheeses. Canada's list also includes types of steel, including that used for railway track and pipelines, as well as coffee, maple syrup, toilet paper, beer kegs, types of aluminum, sailboats and sleeping bags.
ACC represents major chemical manufacturers, including DowDuPont, ExxonMobil Chemical and Chevron Phillips Chemical, all of which are among manufacturers opening new US petrochemical plants.
Dooley's statement said that US chemical manufacturers have kept a competitive edge by extending regional supply chains. Resin packagers have expanded and built new capacity to ready most if not all of the new polyethylene output for export, and ports have upgraded wharves, added cranes and made other improvements to accommodate more traffic in light of the boom in petrochemical construction.
Dooley said that not only could increased costs chill new projects, retaliation from US trading partners could curtail exports, eroding $194 billion in chemical investments predicated on US exports to countries targeted by tariffs.
Some market sources echoed Dooley's concerns. "This could quickly escalate into a trade war," a source said. "This is not good for anybody in the entire world."
But another source said the decisions to lift the steel and aluminum tariffs exemptions for those three regions could be part of a bigger effort to renegotiate the North American Free Trade Agreement with Mexico and Canada as well as trade deals Wit EU countries.
"This is all a negotiating ploy with Trump," a source said. "We'll see how it all shakes out."https://www.platts.com/latest-news/petrochemicals/houston/newest-steel-tariffs-could-undercut-chemical-10450571
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(ACC Mentioned) Texas Industry Fears Economic Hit from Trump Tariffs
May 31, 2018 | Houston Chronicle
By James Osborne
The Texas economy, rich in companies that rely on foreign steel and aluminum, is likely to take a hit from the Trump administration’s decision to impose tariffs on the metals produced by some nation’s largest trading partners, including Mexico, Canada and the European Union.
From oil and gas operators to construction and manufacturing plants, Texas is a massive consumer of steel and aluminum, depending heavily on supplies from Europe, Mexico and Canada, which account for about half the nation’s imported metals.The new tariffs will only drive costs higher for these and other businesses, still reeling from price spikes from duties President Donald Trump imposed earlier this year on steel and aluminum from China and most of the world’s other suppliers.
At a time the Houston economy is still recovering from the collapse in oil prices in 2014, the tariffs could spur another round of cost cutting and layoffs at Houston energy and manufacturing firms that many had hoped were at their end, said Patrick Jankowksi, regional economist at the Greater Houston Partnership, a business advocacy group.
"This isn't going to derail the recovery but it may slow down the process," he said. "This is not good for Houston. The impact of a trade war could be felt more here than any other metropolitan area in the country."
Houston and Texas are among the nation’s most active hubs of international trade. Texas ranks first among states in exports and Houston third among some 250 U.S. ports, according to the Commerce Department. Exports account for about 17 percent of the Houston economy, according to Jankowski.
The administration’s move, meanwhile, is expected to worsen an increasingly hostile global trade climate. The E.U., Mexico and Canada have already promised to impose tariffs on U.S. exports from steel to jeans to bourbon to pork.
"This retaliation will likely get worse before it gets better," said Josh Zive, a Washington attorney with the law firm Bracewell. "It is likely that the prices and lead times for steel and aluminum, already climbing in the wake of the [tariffs], will increase at an accelerated pace.”
As part of a strategy to protect the U.S. steel and aluminum industries, the White House is placing a 25 percent tariff on steel and a 10 percent tariff on aluminum from the Mexico, Canada and the European Union, beginning midnight Friday.. The three trading partners were initially exempted from the duties that went into effect for most countries in March.
The delay allowed the Trump adminstration to conduct additional talks to resolve the metals dispute short of punitive tariffs and a trade war. Among the topics under discussion was the North American Free Trade Agreement, which Trump has threatened to leave if he cannot reach a new deal with Canada and Mexico.
But Commerce Secretary Wilbur Ross said Thursday those discussions had not progressed enough to warrant a further delay in the tariffs.
Already the Texas manufacturing sector has cut growth projections for this year amid expectations of higher materials costs and lower profits. A report released by the Federal Reserve Bank of Dallas this week said "tariffs and trade-related concerns were creating uncertainty" for the Texas economy.
Oil and gas companies rely on steel for the equipment, pipe and other materials used to drill and complete wells. They expect the tariffs to boost costs between 5 and 10 percent, threatening a renewed drilling boom that has added jobs in oil fields across Texas and United States.
"[Profit] margins are not where they need to be to offset this,” said Ed Longanecker, president of Texas Independent Producers & Royalty Owners Association, a trade group. “This is a net loss, no matter how you look at it, for U.S. oil and gas.”
Also at stake is a Gulf Coast petrochemical boom, which has driven the building of new and expanded facilities and the creation of thousands of construction and manufacturing jobs. The additional steel and aluminum tariffs could "force the delay, abandonment, or even cancellation of billions of dollars of chemical production facility investments that have been announced over the last 10 years," said Cal Dooley, president of the American Chemistry Council, the chemical industry trade group.
ndustries across the American economy have been lobbying the White House to let up on tariffs for months with little success, as Trump seeks to carry through on a campaign promise to protect American industry from low-cost competition abroad.
In the meantime companies are quickly applying for exemptions from the tariffs, adding to a backlog in requests the Department of Commerce is struggling to keep pace with.
"The Department of Commerce will likely see thousands of new exclusion requests filed, adding to the thousands waiting for action from the agency," said Zive, the Bracewell lawyer.
Katherine Blunt contributed.
https://www.houstonchronicle.com/business/article/Texas-industry-fears-economic-hit-from-Trump-12958717.php
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(ACC Mentioned) Industry Groups Take Familiar Battle Lines in Wake of New 232 Tariffs
Jun 1, 2018 | Inside US Trade
By Jack Caporal
Industry and business groups have taken now-common sides for and against the Trump administration’s decision to impose Section 232 tariffs on steel and aluminum from Mexico, Canada and the European Union starting June 1, with downstream manufacturers and groups susceptible to retaliation expressing dismay with the decision while steelmakers praised the move.
Thomas J. Gibson, president and CEO of the American Iron and Steel Institute applauded President Trump for letting exemptions for those three countries expire.
“The U.S. producers of AISI fully support the administration’s position that any country that is granted an exemption from the tariffs must be subject to a quota, in order to safeguard against the exempt country becoming a conduit for trade diversion, transshipment and import surges,” Gibson said in a statement.
Gibson added that NAFTA talks “should continue as they can be a basis for ensuring use of more NAFTA steel while achieving the objectives of the Section 232 remedies."
Scott Paul, president of the Alliance for American Manufacturing, said the 232 tariffs have brought steel and aluminum jobs back to the U.S. and beat back criticism that the tariffs have hurt efforts to build an international coalition to confront China’s trade practices.
“There is evidence the Section 232 strategy is working as the Trump administration moves ahead with its steel and aluminum trade actions. American smelters and steel mills are reopening, which means more jobs and added capacity. And more pressure is being applied by our allies to China on steel dumping and overcapacity,” he said in a statement.
Support for the president’s decision to hit Canada with steel and aluminum tariffs, however, is not shared by the United Steelworkers. The union has said Canada should receive a permanent exclusion from the steel and aluminum tariffs.
“This decision is unacceptable and calls into serious question the design and direction of the Administration's trade policy,” the United Steelworkers said in a statement Thursday. “The decision not to exempt Canada ignores the fact that Canada's steel and aluminum exports to the United States are fairly traded and that Canada has shown its willingness to strengthen its laws as well as its cooperation with the United States to fight unfair trade.”
The union agreed with supporters of the 232 tariffs in assessing that the measures had created steel and aluminum jobs, but said efforts to strengthen U.S. national security and work with allies to eliminate unfair competition and global cooperation are “at risk now.”
The steelworkers added, “in recent days, it has become increasingly difficult to understand the reasoning behind certain decisions and policies. The regular chaos surrounding our flawed trade policies is undermining the ability to project a reasoned course and ensure that we can improve domestic production and employment.”
“So far, the Administration's trade policies have led to confusion, higher trade deficits and no real success in changing the practices of our trading partners. Ultimately, the goal is not a tariff barrier, but a stronger America. It's time to ensure that we're on the right path,” the union said.
Groups representing downstream users of steel and aluminum blasted the Trump administration’s decision to let the exemption expire.
Paul Nathanson, a spokesperson for the Coalition of American Metal Manufacturers and Users said “Make no mistake: restricting the raw material supply in the U.S. and imposing tariffs on imports from our closest trading partners places American manufacturers directly in harm’s way.”
“The pain will by no means be limited to the manufacturing sector; a slew of other U.S.-made products will soon be penalized with retaliatory tariffs by our major export trading partners,” he added. Members of the group have been put at a global disadvantage due to tariffs already in place which have caused “price spikes and increased lead times for steel and aluminum inputs they use to make finished products,” Nathanson said. The U.S. tariffs and retaliation will undo gains generated from tax reform passed last year, he said.
The president and CEO of the Beer Institute Jim McGreevy said the tariffs constitute a “new $347 million tax on the U.S. beer industry.” He said since Trump announced the initial aluminum tariffs in March, the price of the metal has “skyrocketed,” increasing costs for brewers and consumers.
American Petroleum Institute president Jack Gerard warned that the tariffs on Mexico, Canada and the EU could compromise “ongoing and future U.S. energy projects, which could weaken our national security.” He said the three governments are part of the U.S. defense industrial base and “far from a threat to America’s security.”
National Foreign Trade Council president Rufus Yerxa said he “is increasingly concerned about the Administration’s trade policy and what these actions, when taken as a whole, mean for the future of U.S.-based companies who depend on a functioning international trading system to succeed.”
Yerxa added that the EU, Mexico and Canada are not only among the “most important trade and security allies,” of the U.S., “but they represent a significant percentage of the world’s consumers who have, until now, made the U.S. an export powerhouse.”
Agriculture groups recoiled on news that Canada, Mexico and the EU would be hit with fresh duties. Canada, Mexico and the EU have all pledged to retaliate against the U.S. steel and aluminum tariffs with duties of their own on a range of U.S. agricultural products and other goods.
U.S. Grains Council President and CEO Tom Sleight said “key markets for U.S. grain and related products” are at risk due to retaliatory measures.
"We had strong hopes this situation would be averted permanently, but it now appears we need to prepare for retaliation and its direct impact U.S. farmers. Our global staff is doing this to the best of their abilities as we continue to follow new developments," Sleight said.
Brian Kuehl, executive director of Farmers for Free Trade said the tariffs will take U.S. farmers “to the breaking point."
“This announcement opens the floodgates to billions in new tariffs on American agriculture,” he said. “Already, farmers are grappling with the impact of previous tariffs which have caused falling commodity futures, higher equipment prices, and the markets they’ve fought to get into for decades to vanish overnight. The addition of new retaliatory tariffs on everything from bourbon, to rice, to orange juice and cranberries will only widen the pain to additional farmers across the country.”
Kuehl added that farmers are ready to make their dissatisfaction known at the voting booth.
“American farmers overwhelmingly supported President Trump in 2016 but will not be silent in the face of trade wars that harm U.S. agriculture. This summer, as lawmakers return home, the voices of farmers who are bearing the brunt of trade chaos and uncertainty will be heard. For many farmers, this is a matter of economic survival. We will continue to fight to ensure the Administration is listening to America’s rural communities in the weeks and months ahead,” he said.
Chairman of the Senate Agriculture Committee predicted the agriculture industry will bear the brunt of retaliatory tariffs and called for a resolution of trade tensions.
“Time and time again I have voiced my concerns on steel and aluminum tariffs and the damage they will cause across many sectors of the economy,” Roberts said in a statement sent to Inside U.S. Trade. “Agriculture in particular is likely to face harm from retaliatory action and the uncertainty that comes with it. The U.S. and China must work to resolve these issues and provide our producers with open, fair and reliable markets.”
Retail groups including the American Apparel and Footwear Industry and the Retail Industry Leaders Association also decried the tariffs out of fear of retaliation.
“The administration has created a three-front trade war, targeting NAFTA, China, and now the European Union, with no resolution to any of these disputes in sight,” RILA’s vice president of International Trade Hun Quach said in a statement.
The American Chemistry Council said its industry will be harmed not only by the tariffs on steel and aluminum from Mexico, Canada and the EU but retaliation as well.
Higher steel and aluminum prices, “could force the delay, abandonment, or even cancellation of billions of dollars of chemical production facility investments that have been announced over the last ten years. Downstream industries like the automotive sector, which relies on both chemicals and metals, will feel the crushing impact of the tariffs as well,” American Chemistry Council president and CEO, Cal Dooley said in a statement Thursday.
“Retaliation by our trading partners will curtail U.S. exports and erode the $194 billion in chemical industry investments that are predicated on the U.S. being able to export to the countries targeted by these actions. The EU has already threatened to retaliate by imposing a 25 percent tariff against approximately $500 million in exports of U.S.-made chemicals. We anticipate other trading partners to target chemicals as well,” Dooley added.
https://insidetrade.com/daily-news/industry-groups-take-familiar-battle-lines-wake-new-232-tariffs
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Jun 1, 2018 | USA Today
By Ledyard King
The latest chapter of Scott Pruitt's ambitious remake of the Environmental Protection Agency took place Thursday in a windowless conference room of the sprawling Washington Plaza hotel.
There, more than 30 members of the EPA's influential Science Advisory Board gathered to discuss such topics as air pollution standards, auto emission rules, and a controversial plan the EPA administrator is proposing that would limit the science that's been used to underpin an array of environmental regulations.
The five-hour discussion often gravitated towards technical and arcane items. But the makeup of the panel sent an unmistakably simple message: industry and state officials are going to have a larger say in shaping environmental and public health policies under the Trump administration.
Thursday's meeting (which will carry over into Friday) was the first since Pruitt revamped the panel's membership last fall in a move he said was meant to inject a diversity of opinions into the regulatory process.
The change was quickly denounced by environmental activists who see the move as part of the administration's aggressive deregulatory agenda to gut public health protections and help its petroleum, manufacturing and chemical allies.
Created by Congress in 1978, the 44-member advisory board is among the most important of 22 EPA panels who review EPA proposed rules and decide whether to weigh in. The administrator doesn't have to follow their recommendations but they are publicly released.
When he became administrator last year, Pruitt decided to revamp the boards because he thought they didn't fairly represent the United States geographically or the industries that would have to abide by the regulations.
"The challenges for air and water quality are very diverse across the country: Utah is the second driest state in the country; Minnesota's a little bit different with respect to the needs they have," Pruitt said last fall. "So it's very important to have a contingent of scientists and individuals that represent the needs that we have across the country."
The meeting was chaired by Michael Honeycutt, Texas' chief state toxicologist who was hand-picked by Pruitt to chair the panel. Honeycutt has criticized EPA for scaring the public about the toxicity of certain pollutants such as mercury.
Asked if he thought the reconstituted panel was a better reflection of the varied perspectives Pruitt was trying to imbue into the agency culture, Honeycutt demurred.
"There are lot of different viewpoints from scientists," he told reporters during a break. "if you have a four ounces in an eight-ounce glass, is the glass half empty or half full? Our job is to tell you here's four ounces of liquid in that 8-ounce glass and let someone else determine if it's (affecting) your health. We're here to give advice to the administrator and, as you can see, I think we're working hard to do that."
Honeycutt is among several new members on the panel that have joined since Pruitt remade the panel. Other newcomers include:
· Robert Blanz, Chief Technical Officer at the Arkansas Department of Environmental Quality
· John Graham, dean of the School of Public and Environmental Affairs at Indiana University, who led deregulatory efforts under President George W. Bush.
· Merlin R. Lindstrom, Phillips 66 vice president for technology
· Donald van der Vaart, a former secretary of the North Carolina Department of Environment and Natural Resources who argued that oil and gas drilling off the coast could be done safely.
· Kimberly White, Senior Director, Chemical Products and Technology Division American Chemistry Council who has criticized the agency's over-regulation of potentially toxic materials.
Researchers from academic institutions still comprise a majority of the advisory board but more lineup changes are expected as the terms of existing members from the Obama era expire.
The turnover has been accelerated by a new requirement that none of those sitting on the agency's 22 advisory committees are allowed to receive EPA grant money. Pruitt said doing so was a conflict that violated the scientific integrity of the agency's work.
Environmental and public health advocates who addressed the panel about objections to various regulations proposed by the EPA did not mention the board's new makeup among their list of grievances.
But David Cooke, a senior analyst with the left-leaning Union of Concerned Scientists, who took issue with a proposal that could ease auto emission standards spoke of a larger dissatisfaction with the current administration's approach to regulation.
The move, he told the panel, reflected "many of the shortcomings identified as part of a broader pattern across recent EPA activity (that includes) an overreliance on industry comments."
https://www.usatoday.com/story/news/politics/2018/06/01/epa-science-advisory-board-includes-more-industry-friendly-voices/660237002/
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(ACC Mentioned) Embracing a Circular Economy
Jun 1, 2018 | Chemical Engineering Online
By Dorothy Lozowski
Last month, for the first time, U.S. plastic resin producers publicly committed to measurable targets toward complete recovery and recycling of plastic packaging. The American Chemistry Council’s (ACC; www.americanchemistry.com) Plastics Division, which includes 15 of the leading resin manufacturers, announced the following ambitious goals: 1) 100% of plastics packaging is recyclable or recoverable by 2030; and 2) 100% of plastics packaging is re-used, recycled or recovered by 2040.
To reach these ambitious goals, the division outlined the following six focal areas in its announcement: 1) design of new products for greater efficiency, recycling and reuse; 2) new technologies and systems development for collecting, sorting, recycling and recovering materials; 3) simplification for more consumers to participate in recycling and recovery programs; 4) expansion of the types of plastics collected and repurposed; 5) product alignment with key end-markets; and 6) increased awareness that used plastics are valuable resources
A GLOBAL ISSUE
A study reported in July of last year in Science Advances (www.advances.sciencemag.org/content/3/7/e1700782.full) states that as of 2015, only around 9% of plastic waste had been recycled and 79% was accumulated in landfills or the natural environment. Plastic debris has been found in all of the oceans, and an estimated 4 to 12 million metric tons of this debris entered the marine environment in 2010 alone.
In its current June issue, National Geographic magazine (www.nationalgeographic.com/magazine/2018/06/plastic-planet-waste-pollution-trash-crisis) brings awareness to the environmental impact of plastics, and in particular to the marine environment. The striking images in the article emphasize the findings of the report. ACC’s vice president of plastics, Steve Russell, commented on the article, saying “Marine litter is a serious global problem, and we appreciate National Geographic’s thoughtful and compelling coverage.”
And this month, sustainability and recycling will be a focal topic at the Polyethylene-Polypropylene Chain Global Technology & Business Forum (www.ihsmarkit.com) in Düsseldorf, Germany. While demands for plastics are growing, so are consumer expectations for sustainability. According to Nick Vafiadis, vice president of plastics for IHS Markit (the host of the forum), “The issue of sustainability is perhaps the most critical influencer for the plastics industry as a whole, both today and in the future.”
SUPPORTING TECHNOLOGIES
Developing and existing technologies are poised to support the move toward a circular economy. For example, in April, Agilyx (www.agilyx.com) began polystyrene recycling operations, said to be the world’s first commercial-scale closed-loop chemical recycling process. And numerous companies, such as Vadxx (www.vadxx.com) and Greenmantra (www.greenmantra.com), are working on creating value from waste plastics.* The goals announced by the ACC Plastics Division and the worldwide efforts to move away from a linear economy with disposal as an end result, to a circular economy with reuse and recycling, are welcome initiatives that can ultimately benefit us all.
http://www.chemengonline.com/embracing-circular-economy/
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Energy Groups, Republicans Bash Trump over Tariffs
May 31, 2018 | E&E News PM
By Hannah Northey
President Trump drew fire today from U.S. allies, Republicans and a large slice of the energy sector after announcing sweeping tariffs on steel and aluminum imports from friendly shores.
At risk, many critics warned, is Trump's self-described goal of "energy dominance."
Imposing a 25 percent tariff on imported steel and 10 percent on aluminum from the European Union, Mexico and Canada will raise energy costs domestically and derail efforts to achieve Trump's energy agenda, said Jack Gerard, the outgoing president and CEO of the American Petroleum Institute.
"The implementation of new tariffs will disrupt the U.S. oil and natural gas industry's complex supply chain, compromising ongoing and future U.S. energy projects, which could weaken our national security," said Gerard. "Additionally, Canada, Mexico and the European Union are imperative members of our Defense Industrial Base (DIB) and are top military allies — far from a threat to America's security."
Calling the move "troubling," Don Santa, president and CEO of the Interstate Natural Gas Association of America, likewise said the move threatens Trump's push to take advantage of the nation's abundant shale plays. U.S. pipeline developers, he noted in a statement, rely on large-diameter, thick-walled steel, a niche product that's not produced domestically.
"Pipelines require specialty steel products not always available in sufficient quantities and specifications from domestic manufacturers," Santa said. "For certain steel products used in pipelines, no domestic product is available today."
Threats of the tariffs have for months aligned strange bedfellows in opposition, including top Republicans, Koch-funded advocacy groups and the solar industry. Canada, the largest consumer of U.S. steel, vowed today to impose "dollar for dollar" retaliatory tariffs on U.S. steel, aluminum and other products from the United States, up to $16.6 billion. That equates to the same amount of goods Canada exported to the United States last year, officials said.
"Let me be clear: These tariffs are totally unacceptable," Canadian Prime Minister Justin Trudeau said at a press conference before calling them an "affront" to Canadians who have fought and died alongside Americans.
Canadian officials also said the tariffs are "illegal" and vowed to dispute the measures at the World Trade Organization.
The Trump administration today said the tariffs are necessary because "excessive" imports of steel and aluminum threaten to impair national security, citing Commerce Department investigations. The White House also said it tried and failed to reach an agreement to avoid the tariffs, as the administration has done with Australia, Argentina, Brazil and South Korea.
Senate Finance Chairman Orrin Hatch (R-Utah) today called the tariffs a "tax hike," while Sen. Ben Sasse (R-Neb.) blasted the White House for treating U.S. allies like adversaries.
"About those new tariffs: Europe, Canada & Mexico aren't China. You don't treat allies the same way you treat opponents. Blanket protectionism is a big part of why we had a Great Depression. 'Make America Great Again' shouldn't mean 'Make America 1929 Again,'" Sasse tweeted.
"Trade wars do not end well," added Sen. Jeff Flake (R-Ariz.).
https://www.eenews.net/eenewspm/2018/05/31/stories/1060083143
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(ACC Mentioned) Chemical Info Could Be Slow to Reach States, EMTs Under EPA Plan
May 31, 2018 | BNA Daily Environment Report
By Sam Pearson
Industry and health advocacy organizations are watching closely as the EPA adds new tools so that, during emergencies, local authorities and first responders can access chemical trade secrets previously kept in-house.
Their concerns are twofold, however. It could take too long for company data to reach authorities that need it during a factory accident or fire, and the files might not be kept secure when they arrive.
“I think it’s really incumbent upon EPA to sort of make this thing work,” Robert Sussman, a former EPA deputy administrator who is now a counsel for the advocacy group Safer Chemicals, Healthy Families in Washington, told Bloomberg Environment May 29.
The agency is acting after Congress amended the nation’s chemical oversight law, the Toxic Substances Control Act, in 2016. The changes came after reports that the identities of more than 17,000 chemicals were withheld as confidential business information, preventing regulators from sharing data with firefighters and emergency medical technicians facing spills and accidents.
The information could help communities better understand how to fight chemical fires, or in what manner a little-known substance spilled in a river is likely to harm the public.
Now companies, health organizations, and the Environmental Protection Agency are trying to figure out how to provide this access without harming businesses. The issue is “an ongoing topic in our industry,” Lisa Goldstone, a spokeswoman for chemical company Lanxess Corp. in Pittsburgh, said in an email to Bloomberg Environment.
But both health organizations and groups representing major chemical companies said the EPA’s draft guidance released in March is flawed.
Flawed GuidanceThe procedures could lead to local authorities calling federal offices after business hours during emergencies, or force them to send other requests by mail, where they may not receive a prompt response.
Meanwhile, industry organizations want tough requirements for authorities to protect the information, because disclosing sensitive data could help a company’s competitors.
The information sharing is distinct from an Obama administration regulation—delayed by EPA Administrator Scott Pruitt and under challenge in court—that would have required chemical companies to send more information on facility safety plans to local authorities.
In the draft guidance, the EPA sets procedures for how local authorities would obtain chemical information from companies during a crisis and for longer-term inquiries.
For nonemergencies, authorities would have to write to an EPA office that manages the information. In emergencies, they could call an existing EPA hotline or the director of information management at the division with oversight of the chemicals program.
But neither of these options is available outside regular business hours, when the emergencies can occur.
The setup is an issue because local responders will be less likely to use the information if accessing it is slow or complicated, Ken Zarker, an environmental manager at the Washington State Department of Ecology in Lacey, told Bloomberg Environment.
‘Black Hole’Companies are concerned about the limited hours of the EPA office that would receive the calls, Christina Franz, senior director of regulatory and technical affairs at the American Chemistry Council in Washington, told Bloomberg Environment. Constrained availability could delay access to the information. The trade group represents more than 150 major chemical producers, including BASF SE, Chevron Phillips Chemical Co. LLC, and DowDuPont Inc.
Advocacy organizations also have questions. In public comments filed April 16 with the EPA, Safer Chemicals, Healthy Families; Asbestos Disease Awareness Organization; Alliance of Nurses for Healthy Environments; and Alaska Community Action on Toxics wrote that the agency must make employees reachable so that requests don’t “fall into a black hole and languish without response for weeks or even months.”
The American Chemistry Council has floated the idea of sending local authorities to its in-house emergency service, CHEMTREC, a safety hotline for chemical companies in operation since 1971, and is hoping to conduct a tour of the program’s offices in Fairfax, Va., for EPA employees, Franz said.
Others said using existing poison control hotlines or working with the Centers for Disease Control and Prevention could solve the communications problem.
Integrating CHEMTREC into the program may not be able to provide sufficiently advanced safety information on chemicals, unless the program is changed, according to Sussman.
The EPA said in a statement to Bloomberg Environment that it will finish the guidance by June 22. The final guidance will address companies’ concerns, the EPA said.
Completion of the system will be welcome news for officials such as Ken Jock, environment director at the Saint Regis Mohawk Tribe in Akwesasne, N.Y.
The tribe, which is close to the Saint Lawrence Seaway, an Alcoa Corp. aluminum smelter, and a shuttered General Motors Co. parts factory that is now a Superfund site, hopes to be able to use chemical data to protect against environmental threats.
“We realize that accidents do occur,” Jock told Bloomberg Environment. “Rather than trying to cover up something, being able to take action to remedy or to mitigate it is going to go a long way towards protecting the community, and also improve relations between industry and the community.”
https://news.bloombergenvironment.com/environment-and-energy/chemical-info-could-be-slow-to-reach-states-emts-under-epa-plan
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(ACC Mentioned) Chemical Found in Plastic Could Harm Children’s Heart Functions, Professor Finds
May 31, 2018 | GW Hatchet
By Sarah Roach
A pediatrics professor led new research finding a chemical commonly used to make plastic water bottles and DVDs can adversely affect children’s heart functions, Chemical Watch reported Thursday.
Nikki Posnack, an assistant professor of pediatrics, spearheaded the study conducted by scientists at the Children’s National Health System, a children’s hospital in D.C. Researchers used heart cells from newborn rats to test how environmental, clinical and extreme exposure to Bisphenol A – also known as BPA – affects cardiac function, according to Chemical Watch.
The group found that exposure to BPA, which is typically found in plastic and metal food containers, caused reduced spontaneous beating rate and increased beat rate variability in the heart cells. Exposure also impacted the way the cells could handle calcium, but these effects were partially reversible, the article states.
Posnack previously conducted studies using rats to show that BPA can also harm adult heart functions, according to the report. She said in the article that the heart effects of BPA could be related to endocrine disruption, though more research on the topic is needed.
But Steve Hentges, the executive director of the Polycarbonate/BPA Global Group of the American Chemistry Council, said the study does not accurately portray the chemical’s effect on human health.
“For example, the range of concentrations tested in general are well above serum concentrations that are expected, or even possible, in humans,” Hentges told Chemical Watch.
The U.S. Food and Drug Administration has said that BPA is safe at its current levels found in food and packaging. BPA is banned from baby bottles and sippy cups in the United States.
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EPA Sets Interim Limits on Hypochlorite Bleach to Reduce Degradation to Perchlorate
May 31, 2018 | Environmental Defense Fund
By Tom Neltner
On May 1, 2018, Environmental Protection Agency’s (EPA) Office of Pesticide Programs (OPP) made an interim pesticide registration decision[1] for hypochlorite bleach used to disinfect drinking water. The office decided to require the “Precautionary Statements” section of the bleach’s pesticide label to include advisory best management practices to minimize the formation of chlorate and perchlorate. The new label will state:
"The following practices help to minimize degradant formation in drinking water disinfection:
· It is recommended to minimize storage time.
· It is recommended that the pH solution be in the range of 11-13.
· It is recommended to minimize sunlight exposure by storing in opaque containers and / or in a covered area. Solutions should be stored at lower temperatures. Every 5º C reduction in storage temperature will reduce degradant formation by a factor of two.
· Dilution significantly reduces degradant formation. For products with higher concentrations, it is recommended to dilute hypochlorite solutions with cool, softened water upon delivery, if practical for the application."
EDF submitted comments in November 2017 supporting OPP’s proposed label changes and requesting specific changes to the language including making the advice to users mandatory. We also asked the agency to extend the changes to hypochlorite bleach used to treat produce and to disinfect food handling equipment.
The agency declined to make our requested changes to the proposed language because:
· The feasibility of different drinking water utilities to implement the practices varies based on geographic location and facility logistics.
· The results of a proposed model predicting the risk of perchlorate on infant and fetal brain development was not complete. They may affect the final decision on the label. This model was developed by EPA’s Office of Water and the Food and Drug Administration (FDA).
· The agency did not have the data showing significant concern that hypochlorite used to treat food handling equipment was a problem when used according to label instructions.
OPP indicated it will continue to monitor progress on the EPA/FDA perchlorate risk model carried out by the agency’s Office of Water and may reevaluate the options before a final reregistration decision is made in 2022. The agency is under a court order to finalize the model and issue a proposed maximum contaminant level goal for perchlorate in October of this year.
Based on the positive feedback from the peer review panel on the model, our assessment of its implications, and the high perchlorate levels found in foods, such as produce, that are often treated with bleach water, we maintain that EPA should extend the best management practices to hypochlorite used to disinfect food and food handling equipment. We encourage any food company concerned about perchlorate contamination in its products to work with its suppliers and follow the best management practices laid out by EPA in its decision.
[1] Sodium and calcium hypochlorite notice and the potassium hypochlorite notice are in separate rulemaking dockets.
http://blogs.edf.org/health/2018/05/31/epa-hypochlorite-bleach-perchlorate/
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Interior Receives First Application for Work in Arctic National Wildlife Refuge
May 31, 2018 | The Hill - E2 Wire
By Josh Delk
The Interior Department is pushing back on the first permit application for development work in the newly-opened Arctic National Wildlife Refuge amid criticism from environmental groups.
An oil exploration firm and two Alaska Native corporations together submitted an application to begin seismic exploration work in the wilderness area, the first application for such a project since Congress opened up the area to such work last year, The Washington Post reported.
The plan reportedly calls for the use of explosives, sleds and large teams of workers to map underground gas reserves.
The application is the first step toward oil and natural gas drilling in the previously protected area, but it faces major obstacles before the project can begin.
“This plan is not adequate,” Interior’s Fish and Wildlife Service said in its reply to the application, according to the report.
The agency's lengthy response specifically criticized the timing of for the proposed operation and "lack of applicable details" or studies on its impact, according to the Post.
Portions of the refuge area remain a critical habitat for polar bears and other endangered arctic mammals. Congress opened up part of the refuge to drilling last year.
Environmental groups have pushed back against the use of the land and are closely monitoring the application process.
“Our biggest fear is that this is going to be rubber-stamped because there is so much top-down pressure from the Trump administration to approve exploration and drilling as soon as possible,” the Wilderness Society's Arctic program director Lois Epstein told The Post.
http://thehill.com/blogs/blog-briefing-room/390175-companies-plan-for-congress-approved-drilling-in-arctic-wildlife
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Oil, Gas Drilling in Arctic Refuge Divides Alaskans
May 31, 2018 | BNA Daily Environment Report
By Jill Burke
Plans to sell oil and gas leases on the Alaskan coastal plain home to the Arctic National Wildlife Refuge that could yield $1.8 billion intensifies a divide among communities over whether to proceed with the exploration project.
One in a series of six public meetings held by the Bureau of Land Management around the state came to Anchorage on May 30 as the agency works to craft an environmental impact statement in advance of lease sales. The refuge spans 19.3 million acres in northeast Alaska, and is home to caribou, moose, wolves, polar bear, fish, and migratory birds.
The coastal plain under consideration for lease sales is a 1.6 million acre area between the Brooks Range and the Beaufort Sea.
But the project has divided communities: Those who want the Arctic wilderness to remain untouched and those who are pro-development and hope oil and gas exploration will help fund state government and generate revenue to offset the Trump administration’s tax cuts.
Glenn Solomon, an Inupiat whaling captain from the village of Kaktovik on the Northern border of the lease sale area, and Wainwright, Alaska, Mayor John Hopson Jr., who is also a whaling captain and hunter, testified how oil and gas development has improved life in their communities, providing money to build flush toilets, schools, and health clinics.
“These are simple things that everyone else in Alaska takes for granted that we have to constantly fight for,” Hopson said. “People that have spoken this evening don’t even live up there. They are never going to see the hardship that we do.”
‘Food Security’Exploration company owners, conservation groups, and members of the Gwich’in Athabascan Indians, which the refuge is home to, testified against the leases.
“What will your message to my people when we can no longer hunt for our food security,” Bernadette Demientieff, a member of the Gwich’in Nation from Fort Yukon, testified during the hearing. “When an oil spill happens, and mark my words it will, the price of that will be more than we can endure.”
“Drilling in the calving grounds of the Porcupine Caribou herd is a direct attack on the Gwich’in Nation and our culture and our way of life,” Demientieff added.
Sales Could Yield $1.8 BillionThe preliminary evaluation process for the lease sales was prompted by the Tax Cuts and Jobs Act of 2017.
White House budget documents estimate the first two lease sales the act mandates could yield $1.8 billion, which would be split between the state and federal government, Joe Balash, the Interior Department’s assistant secretary for lands and minerals management, said at a May 30 press conference before the meeting.
But only one exploratory well hole drilled in 1986 exists—the results from which have been a tightly kept secret. How much oil and gas potential the area actually has is somewhat of an unknown, Balash said.
“I cannot guarantee any companies are going to show up to a lease sale,” Kara Moriarty, president and chief executive officer of the Alaska Oil and Gas Association, testified at the hearing. The association represents BP Plc, Chevron Corp., and Exxon Mobil Corp., among other oil and gas companies.
She advocated for moving forward, citing a 30-year old Interior Department report that recognized the refuge’s 1002 area within the coastal plain as “the nation’s best single opportunity to increase significantly domestic oil production and the most outstanding petroleum exploration target in the onshore U.S.”
“Still today, there is no other onshore opportunity in federal land that has the potential of the 1002 area,” Moriarty said
Disruption on the SurfaceThe tax law requires at least two lease sales of parcels of at least 400,000 acres in the most hydrocarbon rich areas to take place by 2024, and Alaska’s state and federal delegations have endorsed opening the refuge up to development. Surface disruption must not exceed 2,000 acres.
“Even though it’s only 2,000 acres on the surface, that is our heart. And you are going to perform surgery on our heart,” Dana Tizya-Tramm, a Vuntut Gwich’in councilor from the Yukon, told the assembled panel of federal land managers. “The land is us.”
The law ended a decades-long prohibition on oil and gas development in the region by specifically stating that a relevant section of the Alaska National Interest Lands Conservation Act of 1980 wasn’t applicable.
The comment period ends June 18, although the Interior Department is contemplating an extension at the request of stakeholders who feel the process is rushed, Balash said.
A draft environmental impact statement is expected in the fall, with a final version out next spring.
https://news.bloombergenvironment.com/environment-and-energy/oil-gas-drilling-in-arctic-refuge-divides-alaskans
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Florida Senator Demands Answers on Interior's Offshore Drilling Plan
Jun 1, 2018 | The Hill - E2 Wire
By Miranda Green
Florida Sen. Bill Nelson (D) is pushing the Interior Department to answer questions about the future of offshore drilling in his state.
In a letter sent to Interior Secretary Ryan Zinke on Thursday, Nelson urged Zinke to clarify previous statements he and Florida Gov. Rick Scott (R) made that Florida is "off the table" for potential future offshore drilling plans — a statement Zinke made via Twitter in January but has since walked back.
Nelson, who is firmly opposed to opening Florida's offshore waters to oil and gas drilling, asked Zinke to clarify what the state's future for expanded drilling is and to provide details as to how Interior plans to protect Florida's coast.
"Despite your initial announcement in January that Floridians should not worry about your new plan, you later told Congressional committees that 'Florida did not get an exemption' and is 'still under consideration,'" Nelson wrote.
The congressman pressed Zinke for failing to provide any details about the pact he made with Scott earlier in the year that led to his first announcement that Florida would be exempted from the new Interior policy to open up offshore drilling in the U.S.
"Any plan that allows oil drilling one inch closer to Florida's shores is unacceptable," Nelson wrote.
The Hill has reached out to Zinke's office for comment.
Interior first announced in January that it would be looking to expand the offshore drilling options of coastal states as part of the administration's new push toward energy independence and economic security.
Zinke soon announced that Florida, however, would be exempted from the plan, tweeting a statement that read in part: "I am removing Florida from consideration for any new oil and gas platforms."
Many states responded negatively to Interior's plans to expand offshore drilling. The department was equally criticized for appearing to carve out an exemption for Florida in what some called a political ploy.
Zinke later walked back his comments at a number of congressional hearings, telling lawmakers often contradictory statements on whether Florida's exemption was simply a promise or a formal policy decision.
http://thehill.com/policy/energy-environment/390071-florida-sen-demands-answers-on-interiors-offshore-drilling-plan
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Get Used to Bottleneck ‘Blowouts’ in Permian, Apache CEO Says
May 31, 2018 | BNA Daily Environment Report
By Alex Nussbaum and Alix Steel
The pipeline shortages now hammering Permian shale producers are likely to be a recurring theme in the coming years, Apache Corp.’s chief executive officer is warning.
Infrastructure in the prolific drilling basin in West Texas and New Mexico will be built in fits and starts as the area develops, with temporary shortfalls followed by periods of oversupply, John Christmann said in a Bloomberg TV interview May 30. The result: periodic “blowouts” in transportation costs like the one now eating into Permian profits.
“This won’t be a one-time thing as you expand the basin over the next several years,” said Christmann, whose Houston-based explorer holds drilling rights on more than 340,000 acres in the western Permian. “When there’s tightness, those differentials are going to blow out again and then they’ll come back in.“
Production Outpaces Transport Capacity
Amid worries about spare pipeline space, crude in Midland, Texas—the region’s unofficial capital—sold for more than $19 a barrel below Gulf Coast prices on May 30, the highest level in at least 2 1/2 years, data compiled by Bloomberg show. Permian production is set to be “materially above” local refining and transportation capacity for the next 12 to 18 months, analysts at Raymond James & Associates said in a May 29 note.
Apache announced deals to reserve space on three new pipeline projects in recent months, leaving Christmann confident the company will be able to move its oil and gas out of the market, the CEO said. The contracts lock in fees for Apache that aren’t subject to swings in the market, he said.
“This won’t be the last time this will be an issue,” Christmann said. “We’re always trying to look at multiyear plans so we can stay ahead of it.“
Apache in 2016 said it had made one of the energy industry’s biggest U.S. discoveries in years, uncovering at least 75 trillion cubic feet of gas and 3 billion barrels of crude in a remote area of the Permian it dubbed “Alpine High.“
The company’s shares have fallen since then, partly due to concern that a dearth of pipelines would leave supply trapped in the area and send its oil and gas prices tumbling. Apache has said it plans to spend $500 million this year alone to build infrastructure for the region.
Partnering
Christmann said Apache’s on track with a previously announced plan to sell a stake in its midstream division, which has been building out pipelines, processing plants and other facilities. Apache has received “a lot of interest” from multiple bidders in a proposed joint venture, he said.
Labor shortages remain a concern as well, helping to push drilling costs up 10 to 15 percent this year. “It’s the truckers,” the CEO said. “It’s the welders, the electricians, the backhoes—anything that requires people there has definitely been pressured.”
https://news.bloombergenvironment.com/environment-and-energy/get-used-to-bottleneck-blowouts-in-permian-apache-ceo-says
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Bakken Natural Gas Flaring High Priority for North Dakota, Industry
May 31, 2018 | Natural Gas Intelligence
By Richard Nemec
Record associated natural gas production from the Bakken Shale's continuing oil boom in North Dakota remains a top concern for both the industry and the state, executives said last week.
At the Williston Basin Petroleum Conference (WBPC) in Bismarck, officials expressed both concern and optimism about how to capture flared gas during a panel discussion about new technologies being deployed in the play. Earlier this year, state officials hinted that the four-year-old phased-in goals to capture 90% of gas flared in the next 18 months may be altered.
North Dakota Pipeline Authority (NDPA) Director Justin Kringstad registered his concerns about ensuring there is enough gas processing capacity. Production this summer may exceed processing capacity, as the state awaits the ramp-up of five more plants.
"On the longer-term outlook for gas processing, the five new plants will meet the needs for a couple of years, but if production grows as predicted, we'll continue to see additional plants needed," Kringstad said.
He is unsure that expansions by the region's principal interstate pipelines, Alliance and Northern Border, would be enough to move gas out adequately from the region.
"They move both Canadian and Bakken gas to the Midcontinent, but the one fact to understand about Northern Border is that it always leaves the Bakken 100% full," Kringstad said.
Crestwood Midstream Partners, which operates in many U.S. basins, last year invested $165 million in the Bakken to loop its gathering pipeline system and build more gas processing plants. Crestwood opened one skid-mounted processing facility last November, and it is building a second plant that should be ready in the second half of 2019.
"For us, our relationship starts within individual communities," said Crestwood’s Diaco Aviki, senior vice president of business development and commercial operations. He noted that the privately held firm has 20 gas capture projects underway this year.
Crestwood’s gas capture projects are a $22 million smorgasbord, featuring three pump stations, two compressor stations, produced water storage facilities and what Aviki called "massive amounts" of pipelines. For the next two years, the operator has committed $419 million for various oil, gas and water gathering and processing projects.
GTUIT CEO Brian Cebull’s Billings, MT-based company offers remote gas capture, which he called "a bandage when needed." Remote capture, a technology that’s been around for about a decade, is an option when existing gathering and processing infrastructure is full, and production has exceeded capacity.
"The remote capture industry essentially takes the place of that gathering and processing capacity on a temporary basis," Cebull said.
The technology is dominated by wellsite mechanical refrigeration and compression, relying on the cooling of gas through compression. The remote technology is designed to help producers meet state standards, but Cebull said many customers signed their contracts before North Dakota established its phased gas capture goals.
Need for the technology fell during the commodity price downturn, but remote capture available capacity this year is 2.5 times larger than it has been historically, he said. "It represents a capital investment collectively of more than $100 million.”
Remote capture is not in competition with the midstream operators, Cebull said, his industry is "simply in business to be there when the midstream can't be; we're an enhancement to their services."
http://www.naturalgasintel.com/articles/114565-bakken-natural-gas-flaring-high-priority-for-north-dakota-industry
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Jun 1, 2018 | Platts
By Maya Weber
The US Federal Energy Regulatory Commission partly granted Rover Pipeline's request to bring additional segments into service Thursday morning, but held off on giving the go-ahead for two key laterals where restoration is ongoing.
FERC's Office of Energy Projects said Rover could begin full service on Mainline B of the project and start up service on its Supply Connector B. But it did note agree to let gas flows begin on the Burgettstown and the Majorsville laterals, which connect to supply areas.
Rover made the case Wednesday for an urgent market need for FERC to sign off on the facilities by 9 am CDT Thursday to provide time to finalize contractual arrangements for service June 1. Placing into service additional segments of the Rover gas pipeline now completed would unlock 850 MMcf/d of incremental capacity and gas supply, helping to refill "dangerously low" natural gas storage inventory levels, the company had said.
In partially granting the request, FERC said the decision was based on ongoing inspections, reports of third-party compliance monitors, "staff's determination that rehabilitation and restoration of the affected areas are generally proceeding satisfactorily and Rover's commitment to promptly finalize restoration of these facilities."
It noted that final restoration was over 90% complete in those areas.
FERC STILL EVALUATING REQUESTS FOR LATERALS
But FERC said it was continuing to evaluate the requests for remaining facilities. For the Burgettstown lateral, which straddles Pennsylvania and Ohio, Rover's latest filing said 34.3% of final cleanup and restoration would be complete by Friday, when some shipper contracts are set to take effect. For the Majorsville lateral, which straddles Ohio and West Virginia, Rover said 18.7% of the final cleanup and restoration would be complete by then.
Rover's description of remaining work in the Burgettsown Lateral area, as stated in a May 24 filing, includes plans to install toe keys and drains to remove water that saturates material, as well as reconstruction of hillsides.
With the new approval, Rover is now able to bring the entirety of the pipeline's Supply Connector, Mainline and Market Zone North into service.
FLOWS MAY STAY BELOW FULL CAPACITY WITHOUT LATERALS
It is not immediately clear how much flows along Rover will pick up with the full in-service of the pipeline's mainline, but only four of the eight upstream supply laterals operational. Rover should now have the physical ability to flow the project's full 3.25 Bcf/d of capacity along the Mainline with both Mainlines A and B in service. But the amount of gas that will be able to flow along the pipeline is likely well below the project's full capacity as the pipeline still only has half of its supply laterals in service, according to S&P Global Platts Analytics. Amid several spills and other environmental problems during construction, the commission has previously said FERC's decision on remaining in-service requests will depend on whether the agency is satisfied with Rover's commitments to complete environmental restoration.
Multiple Rover laterals have been beset with recurring erosion-control problems, in some cases involving land slips and landslides requiring substantial remediation. The most recent FERC environmental reports tally 635 noncompliance instances for the project.
ETP sought to head off in its latest filing any concerns FERC may have, while also focusing on market needs.
"Given the substantial progress Rover has made toward restoration, and the commitment Rover has made to complete the restoration work, Rover respectfully submits that it is not in the public interest to prevent gas from flowing," ETP said.
"This incremental supply would likely be used to offset the large deficit the nation is facing to replenish storage inventories in preparation for the 2018-2019 heating season."https://www.platts.com/latest-news/natural-gas/washington/ferc-partly-grants-rover-natural-gas-pipeline-26967363
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Editorial: Texas Should Learn from West Explosion, Even If EPA Won’t
Jun 1, 2018 | Austin American-Statesman
By Editorial Board
After 15 people died in the 2013 fertilizer plant explosion in West, after at least seven first responders became ill from the fumes at last year’s Arkema chemical plant fires outside Houston, after four contractors were hurt in an April explosion at an oil refinery in Texas City, the Environmental Protection Agency has concluded — inexplicably — that we’re safe enough.
The EPA is gutting a slate of Obama-era regulations that aimed to reduce the disasters at plants using dangerous chemicals. The agency’s recent announcement came after the Trump administration stalled for a year and a half on implementing the safeguards.
We are not surprised by EPA Administrator Scott Pruitt’s latest abdication of his agency’s mission to protect the environment and those of us living in it. Pruitt represents the worst of President Donald Trump’s scorched-earth appointees, a longtime warrior against the EPA who was tapped last year to undermine the agency from within.
As the 60-day public comment period plays out over Pruitt’s plans, though, we urge the affected industries to listen to the concerns of the communities where they do business. The EPA’s short-sighted decision to lower the bar doesn’t prevent these companies from raising their own standards, protecting their neighbors and their bottom line in the process.
The proposed Obama-era regulations, drafted in the wake of the West explosion that killed a dozen first responders, injured about 260 people and damaged more than 150 buildings, would have required facilities to:
• Routinely examine safer alternatives, such as using less volatile chemicals or changing the way chemicals are stored or processed.
• Hire independent auditors and conduct more rigorous reviews into the causes of any incidents or near-misses, to better identify safety improvements needed.
• Share more information with the public about the volatile chemicals on site, so nearby businesses and other neighbors can better plan for their own safety.
Such rules would improve the safety at thousands of chemical manufacturing plants and distribution sites, petroleum refineries, water and wastewater treatment plants, and other facilities around the country. As previous fires and explosions at Texas facilities have shown, these incidents not only put employees in danger, but they imperil first responders who rush to the scene, sometimes without knowing which chemical hazards are inside, and they put surrounding neighborhoods at risk.
Pruitt, however, looked at these rules and saw only red tape. In announcing the rollback, Pruitt’s agency touted the estimated $88 million in annual savings to the affected industries — a petty sum when divided among the roughly 12,500 facilities involved.
Consider, instead, the costs of the status quo: Over the past decade, according to EPA data cited by the Union of Concerned Scientists, chemical plant accidents have led to nearly 60 deaths and 17,000 injuries across the U.S. Nearly 500,000 people have been ordered to evacuate or shelter in place. About 1,500 incidents caused more than $2 billion in property damage. And these incidents disproportionately affect low-income and minority residents, who are more likely to have such facilities near their neighborhoods.
The EPA says it reconsidered the Obama-era rules, in part, because the explosion in West was traced back to arson “rather than being the result of an accident.” That fact misses the point. Regardless of how the blaze started, the responding firefighters were not aware of the explosive threat posed by the ammonium nitrate on site, nor did they have the proper training to contain such a scene, according to the findings of the U.S. Chemical Safety and Hazard Investigation Board. The schools, nursing home, apartments and other homes located nearby were likewise in the dark about the danger.
Texas lawmakers made several important improvements to state law after the disaster: Facilities must report their ammonium nitrate stockpiles to local fire chiefs and allow fire marshals to inspect the facilities, and these facilities must store the compound at least 30 feet away from combustible materials.
But Texas also took a step backward with Attorney General Ken Paxton’s 2014 opinion withholding from the public a facility’s Tier II reports, which provide basic information about the chemicals on site. Texas officials argued that information could prove dangerous if terrorists or criminals got ahold of it. Pruitt echoed those concerns when striking similar public disclosure requirements in the pending EPA rules.
RELATED: Information scarce on chemical plant blasts — just like Texas wanted
The secrecy is also dangerous, though, as we saw last summer when officials with Arkema Inc. refused to release the reports on their chemical stockpiles at a facility outside Houston that was flooded by Hurricane Harvey. Some chemicals caught fire after the plant’s cooling systems lost electricity. Even as the smoke spread across a highway and forced evacuations of neighborhoods, first responders and residents didn’t have a full picture of the threat in their midst.
Pruitt’s EPA is failing Americans. That shouldn’t prevent companies from being responsible corporate citizens. They should develop detailed emergency action plans with local first responders and explain to neighbors what chemicals are at the plant and how they can protect themselves. They should proactively explore safer materials and procedures, and obtain independent reviews to learn from any accidents.
The public deserves it, even if the EPA won’t require it.
https://www.mystatesman.com/news/opinion/editorial-texas-should-learn-from-west-explosion-even-epa-won/nqD8Hy4yF9ouBvtd9aK62H/
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Federal Assessment Finds ‘Gaps’ in Preparation for Electric Grid Attacks
May 31, 2018 | The Hill - E2 Wire
By Morgan Chalfant
An assessment released by the departments of Energy and Homeland Security this week finds that there are shortfalls preventing the energy sector from improving its ability to respond rapidly in the event of a major cyberattack that disrupts the electric grid.
The report, which was mandated by President Trump’s 2017 cybersecurity executive order, states that the United States is generally “well prepared” to manage major disruptions to the electric grid, such as cyberattacks that knock out power.
It emphasizes the action the federal government has taken over the last two years to prepare for a significant cyber incident, such as Homeland Security rolling out a national blueprint for cyber incident response at the end of the Obama administration.
However, the report details a number of “gaps” preventing private electric utilities, government entities and other stakeholders from bolstering their ability to provide effective incident response in the event of a major cyber assault on the grid.
These include a lack of clarity around the roles of specific organizations in responding to prospective cyber incidents; shortfalls in the electric sector’s cyber workforce; a lack of effort to address supply chain vulnerabilities specific to the electric sector; and lackluster information sharing between private industry and the federal government.
The threat posed by hackers to the electric grid has attracted attention in the wake of cyberattacks that took out portions of Ukraine’s power grid in 2015 and 2016. Russia is suspected of carrying out both attacks.
Lawmakers in Washington have grown increasingly alarmed of the prospect of a cyberattack on the grid after U.S. officials revealed in March that Russian hackers had staged a multiyear campaign to breach networks of the energy sector. In some cases, hackers broke into networks where they were able to view information on industrial control systems — which are used to power the grid in other critical services across the world.
"The next Dec. 7 won't be airplanes and torpedoes coming at Pearl Harbor, it's going to be triggered with an attack on our energy grid with rolling blackouts and chaos," Rep. Don Bacon (R-Neb.) said earlier this year.
The report issued Wednesday emphasizes that there is currently no evidence of intrusions of the U.S. grid resulting in "lasting" cyber or physical damage. However, it acknowledges that hackers have grown increasingly interested and capable in targeting the electric sector, particularly in exploiting industrial control systems.
“There are key trends that are increasing the risk of significant cyber incidents,” the report states. “As cyber capabilities become more readily available over time, state and non-state actors will continue to seek and develop techniques, tactics, and procedures to use against U.S. interests.”
The Trump administration has insisted it is making the security of the energy grid a priority. Energy Secretary Rick Perry in February rolled outplans to set up a new office for cybersecurity and energy security at the department.
“This administration recognizes the growing security risk of cyber threats and has prioritized overcoming these challenges facing our Nation,” Perry said in a statement on the assessment’s release.
The Energy Department, he said, “will continue to work with the Department of Homeland Security, our National Laboratories, public, and private sector partners to improve cybersecurity practices and develop next-generation tools and capabilities that can be leveraged to better understand and mitigate cyber vulnerabilities in the energy sector."
The document was among a slew of reports released this week in accordance with the cyber executive order, which Trump signed in May 2017.
http://thehill.com/policy/cybersecurity/390065-federal-assessment-finds-gaps-in-preparation-for-electric-grid-attacks
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Energy Grid Isn’t Insured Enough to Handle a Catastrophic Hack
May 31, 2018 | BNA Daily Environment Report
By Naureen S. Malik
Insurers are limiting how much coverage energy companies can buy to protect themselves against a major attack by hackers, potentially leaving investors, customers, and taxpayers on the hook for sizable losses.
Brit Insurance, a syndicate that works with Lloyd’s of London, limits cybersecurity policies to around $300 million, according to underwriter James Bright. While companies can piece together policies from different insurers to boost that limit, the costs can be prohibitive, often requiring third-party assessments of security that can need upgrading.
The result is an industry largely unprepared for a hacker-triggered catastrophe, according to cybersecurity experts. The Exxon Valdez oil spill cleanup, for instance, cost $7 billion. Those kinds of numbers have left insurers anxious over the lack of quantifiable information in an expanding market, and concerned the energy industry’s protections may not be adequate.
Energy companies tend to have “a superman fallacy,” said Dante Disparte, the head of Risk Cooperative, a Washington-based brokerage. “They don’t believe bad things will happen to them, or they believe the government will help them get back on the field.”
It’s a belief that’s drawing concern from the U.S. government, according to Disparte, who said he met with Treasury Department staff in mid-May. The government, along with industry groups and companies, are in the early stages of discussing the need for a cyber version of the Federal Deposit Insurance Corp., with energy as an initial target, he said. The Treasury Department wouldn’t immediately comment.
Taxpayer Protection
The goal, according to Disparte: Keep taxpayers from saddling the bill for potential problems. “The energy sector is too big to fail, too big to hide and no single energy company is able to fund the risk on their own,” he said.
In the meantime, cyberinsurance is one of the fastest growing segments of the more than $5 trillion global insurance market. The market for stand-alone cyberplans among all industries was about $1.75 billion to $2 billion in 2017, and the U.S. accounted for 90 percent of that, said Nolan Wilson, the Miami-based leader of the energy practice at Aon Plc, an industry consultant.
By the end of 2018, the global market could grow to $5 billion, including tack-ons to property and liability insurance, according to Jürgen Reinhart, chief underwriter for cyber at Munich RE, an insurance group based in Germany. So far, though, the energy industry makes up just a sliver of the market, less than 3 percent, he said.
Predicting Weather
https://news.bloombergenvironment.com/environment-and-energy/energy-grid-isnt-insured-enough-to-handle-a-catastrophic-hack
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EPA's Push to Overhaul NAAQS Poses Test for 'Cooperative Federalism'
May 31, 2018 | Inside EPA
By Stuart Parker
EPA's push to overhaul and streamline the national ambient air quality standards (NAAQS) process will pose a major test for Administrator Scott Pruitt's pledge to give states more power over environmental decisions, as some states welcome new NAAQS compliance flexibility while others fear it will boost interstate pollution.
“My general impression,” says a Northeastern expert in state air regulation, is that there are “a litany of reasons to relax requirements without any mention of what the administration could do to proactively address the air pollution problems that states supposedly can't address.”
President Donald Trump on April 12 issued an order directing changes to the NAAQS process, which Pruitt followed with a May 9 memo to his assistant administrators on plans for achieving Trump's goals.
One important provision in both the Trump and Pruitt directives that states will likely support, is a requirement for EPA to issue implementation rules and guidance concurrently with new or revised NAAQS. States have long complained that the agency takes too long after issuance of a standard to finalize implementation rules, which specify the air pollution reduction measures states can rely on in their state implementation plans (SIPs) for NAAQS compliance.
Trump's order sets deadlines for EPA action to approve SIPs, to approve permits and to process state requests for regulatory exemptions. It affords states maximum flexibility to request exemptions for periods of high air pollution caused by “exceptional events” such as wildfires, and also boosts states' ability to exempt pollution of foreign origin.
The president's order also states a strong preference to defer to states on their SIPs, in particular for the regional haze program. Critics attacked the Obama EPA's practice of replacing SIPs with EPA-issued federal implementation plans (FIPs) – through which the agency directly writes pollution control measures for a state -- as an example of federal overreach, and EPA under Pruitt has sought to redress the balance of the air law's “co-operative federalism.”
But while many states will welcome EPA's intent to process their SIPs faster and interfere less in their decision making, the administration's new presumption against agency involvement is setting up a clash over interstate air pollution. Emissions from upwind states drift to others downwind, and the downwind states cannot control those emissions.
Coupled with the geographical split between upwind states -- typically those in the Midwest and South – and downwind states, such as those in the Northeast and Mid-Atlantic -- is an ideological split that also tends to pit coastal states against others. Hence California, not normally a “downwind” state, and also a recipient of international air pollution, is resisting the order's policy direction as promoting increased pollution.
California – which is already embroiled in a series of disputes over greenhouse gas emissions – is perhaps the best example of a state that wants to push tougher controls than EPA, yet faces resistance from the agency in its efforts.
California Air Resources Board (CARB) Chair Mary Nichols condemned the order in a recent statement, saying it “caves to a minority of industries who claim Clean Air Act standards are too strict, too costly and too burdensome.”
“The truth is a large body of research shows the Clean Air Act dramatically improves public health, especially among our most vulnerable populations. The consequences of inaction are irresponsible -- unhealthy people, shortened lives, and greater demands on our health care system,” she added.
'Cooperative Federalism'
On the East Coast, Sen. Tom Carper (D-DE) expressed his concern that Pruitt's cooperative federalism push will harm downwind states like Delaware. The change to the NAAQS program “made through Executive Order without any public comment or public health analysis – is alarming to say the very least,” Carper said.
“This shortsighted decision is even more concerning as Mr. Pruitt’s EPA is simultaneously denying downwind states’ efforts to hold upwind states accountable for their air pollution contributions, increasing the air pollution that crosses state borders and taking away critical financial tools and programs to help states address pollution. It is clear this administration has little regard for the plight of downwind states, like my home state of Delaware, and that Mr. Pruitt’s constant invocation of ‘cooperative federalism’ is entirely disingenuous.”
One East Coast clean air expert says that states in the region are “looking for EPA leadership in cross state/boundary issues,” but Trump's order “has the president saying they don't need to be” a leader.
The source fears that the changes to the NAAQS process, including greater deferral to states on crafting their SIPs, “sets EPA as pro-business as part of its core mission,” and provides Pruitt “and states who want it the ammunition to push back on additional requirements” to control pollution.
At a Senate Environment and Public Works (EPW) Committee hearing last month before the order's release, Democratic senators called Pruitt's brand of co-operation a “one-way street,” where states seeking looser environmental protections are granted them, but those seeking tougher regulation are denied.
Sen. Sheldon Whitehouse (D-RI) denounced Pruitt as a practitioner of “corporatist federalism,” designed simply to loosen pollution controls.
But there are aspects of the NAAQS changes that most states welcome, including hard deadlines for EPA to approve changes to SIPs, to approve federally-issued permits, and to approve state requests for exemptions from NAAQS compliance for exceptional events.
Further, many states -- including Texas, Oklahoma and Arkansas -- will likely welcome more deference on SIPs and haze plans in particular, as they seek to set haze plans on their own terms.
Industry Support
Industry officials are also backing the administration's efforts. One industry source defends the changes to the NAAQS process, saying, “Depending on how it gets implemented the directives from the [order] should be quite helpful to state regulators, the regulated community, and the public at large.”
Trump's order “emphasizes the need for timely action on behalf of EPA to follow and implement the [air act's] requirements when it comes to SIP processing, permit review, demonstrations, and other issues that currently take too long and have led to regulatory uncertainty, delayed implementation and unworkable staggering of standards, guidance and implementation efforts.”
Publicly, some industry groups have also been strongly supportive of Trump's effort to overhaul the NAAQS process. For example, the American Forest and Paper Association (AFPA), a vocal supporter of air permitting reform, welcomed Trump's plan on permitting. “We applaud this initiative for EPA to use modern permitting tools, such as probabilistic approaches to ensure permit decisions reflect real world conditions, as well as sensible offset policies for rural areas so beneficial projects can proceed,” said AFPA President and CEO Donna Harman.
Offsets are required by industrial sources trying to build new projects in nonattainment areas, but in some areas with little industry they can be difficult or impossible to attain. Trump's order eases the process of attaining offsets, but in allowing such practices as intrastate and regional “inter-precursor trading” to obtain offsets, the memo directs EPA to adopt a flatly unlawful position, as courts have already rejected this practice, environmentalist sources say.
And the Northeastern expert notes the positive aspects of the NAAQS changes, but also the downside. For example, Trump's order requires that implementation guidance for NAAQS be issued concurrently with new or revised NAAQS, and that EPA issue responses to SIPs within 18 months.
States “have been asking for these kinds of concurrent actions every time there's a new NAAQS. EPA has typically responded it has limited resources to issue guidance/rules with the new NAAQS, or act on multiple SIP submissions by the deadlines,” the source says.
However, the source cautions that the administration's new approach will “continue to feed the narrative that the federal government isn't going to seriously address interstate transport.”
https://insideepa.com/weekly-focus/epas-push-overhaul-naaqs-poses-test-cooperative-federalism
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SAB Votes to Review EPA's Science, Emissions Rules in Sign of 'Rebuke'
Jun 1, 2018 | Inside EPA
By Doug Obey
EPA advisers have voted to review the science underlying agency rules aimed at rolling back a suite of Obama administration's greenhouse gas and emissions regulations, as well as a controversial proposal to require that major rules be based on publicly available science, decisions that environmentalists say amount to a “sharp rebuke” of Administrator Scott Pruitt's deregulatory agenda.
At a May 31 meeting, EPA's Science Advisory Board (SAB) voted to endorse a series of recommendations from SAB workgroups urging the full board to consider the science behind pending EPA plans to scale back light-duty vehicle GHG standards, the agency's proposal to scrap production limits on high-emitting glider trucks, EPA's plan to reconsider new source performance standards for oil and gas operations, EPA's planned repeal of the Clean Power Plan, the agency's retreat from GHG requirements for new and modified power plants, and EPA's science data rule.
The planned reviews, which impose a new level of scrutiny on key prongs in the Trump administration's deregulatory agenda, mark what may be the first instance of SAB oversight of agency regulations since the practice was instituted by the Obama administration.
And they comes despite suggestions by some current advisers that SAB consider deferring on issues including the power plant rules amid promises of clearer EPA communication with the board.
And in the case of the light-duty vehicle regulations, the move turned aside suggestions that SAB might want to defera review until EPA and the Transportation Department issue a proposal in the coming weeks.
“We can say it merits review, and then at a later date, it we decide there is not much to review, we can sunset that review instead of deferring,” one SAB member said.
While the board voted to review the rules, SAB members did not rule out sunsetting their review if more information becomes available that allays their concerns.
Nevertheless, the move is significant because the meeting marked SAB's first gathering since Pruitt removed a host of board members who had received agency grant funds and replaced them with state and industry officials -- including a new chair, Michael Honeycutt -- who were widely viewed as being more supportive of the administrator's deregulatory agenda.
As such, the board's decision is already winning praise from environmentalists. “The leadership of the board was chosen by Pruitt himself, so their decision today is a sharp rebuke of his leadership and this dangerous [science rule] proposal,” Ana Unruh Cohen, managing director of government affairs at the Natural Resources Defense Council, said in a statement.
"Pruitt’s decisions fly in the face of science, the law, and the desires of the American people, and he will continue to be met with resistance in the courts, in the streets, and among his own advisers,” John Coequyt, Sierra Club's global climate policy director, said in a separate statement.
Such statements underscore environmentalists' broader concerns with Pruitt's deregulatory agenda and his efforts to craft science to justify it, including his selection of science advisers as well as the proposed science rule, which they fear will undercut the use of studies containing private health data that the agency has long used to justify strict air quality and other rules.
SAB Frustration
Several SAB members expressed signs of frustration on the quality of EPA communication to date on its planned rules as well as the science underlying those rules.
“We make a request to EPA for information and we get really hardly anything in return,” SAB member Chris Frey of North Carolina University said at one point, echoing others present that this does not necessarily mean the science behind EPA's regulations is flawed but that SAB wants to err on the side of examining the issues.
“My general sense is in any of these recommendations for review is, if there comes a point where EPA is responsive and has identified the science products that they are going to develop or use, and has convinced the [SAB] that they have already obtained or are implementing an appropriate review process, then I think we can step out of it,” Frey said.
But prior statements from the SAB workgroups recommending review -- as well as statements by SAB officials at the meeting -- also made clear that they harbor significant concerns.
The move to review the agency's repeal of rules on high-emitting glider trucks, for example, which combine a new chassis with used engines, comes after an SAB workgroup in its recommendations blasted the apparent science underlying the rule as “dubious.”
Similarly, the workgroup that recommended review of the science data rule strongly criticized the plan, charging it will undermine rules' integrity and was developed without adequate review.
“The proposed rule does not include any assessment of the impact of data restrictions on existing or future regulatory programs. Without access to the restricted data, regulatory programs could become more or less stringent than they otherwise would be, with consequences for both regulatory costs and benefits,” the workgroup said.
SAB also discussed, but ultimately decided to spurn, proposals to hold off on reviewing several of the stationary source GHG rules, despite remarks from EPA officials present downplaying the extent to which the agency will need to rely on novel science.
For example, EPA's Kevin Culligan walked the panel through EPA's view that the agency was not using novel “influential” science information that would require such review.
With respect to EPA's new power plant rule, for example, Culligan said the main issue in play in that rule is a previous determination on whether carbon capture and storage (CCS) represents the best system of emissions reduction for new coal plants -- an issue that he characterized as mostly a policy decision.
“Ultimately the way we look at it is, while there is science information that goes into it, the question . . is really a policy decision,” Culligan, said, citing policy issues including the appropriateness of requiring CCS in areas of the country where it may not be viable due to lack of sequestration opportunities.
But such views failed to win over the SAB.
And the vote in support of reviewing the science rule was widely assumed to be inevitable -- even by SAB chair Honeycutt.
“Does anyone think we should not review this?” he said during the discussion of the science rule. “This might be the quickest decision ever.”
https://insideepa.com/daily-news/sab-votes-review-epas-science-emissions-rules-sign-rebuke
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The Paris Agreement’s Emissions Goals May Be in Trouble, with or Without U.S. Participation
Jun 1, 2018 | Washington Post
By Johannes Urpelainen
Last June, President Trump announced that the United States would withdraw from the 2015 Paris agreement on climate change. How are the Paris goals looking, a year later?
It may be too early to assess whether the Paris signatories are on track with their pledges for the year 2030, but rising carbon dioxide emissions in Asia and Europe, in particular, are a troubling sign. The Paris agreement outlined steep emission reductions to meet the stated goal of limiting global warming to two degrees Celsius.
The 1.4 percent increase in global carbon dioxide emissions in 2017 is itself troubling but not surprising. Global economic growth is one obvious culprit — the world economy grew by 3.7 percent in 2017. This growth created demand for extra energy, which means more oil, natural gas and coal combustion. Regardless of U.S. participation in the Paris agreement, rapid global economic growth increased the use of fossil fuels.
More fundamentally, though, political-science research shows that national governments have only limited ability to control a country’s emissions. Great uncertainties surround both future emissions and the impact of different new policies.
With or without the Paris agreement, it’s hard to know what each country’s emissions levels will look like in the future. Here are four policy areas to watch:
1) Governments cannot credibly commit to long-term policy
In climate politics, governments simply cannot promise that their climate policies will continue indefinitely, as the next government may decide to overturn the policies. Democratic governments face elections every few years, and dictators can be unseated by coups and revolutions.
Given these political realities, climate policies often have short life spans — and this can be a major barrier to effective climate policy. From renewable-energy subsidies to carbon-emissions trading, governments can formulate and implement policies now and hope that they stick. But if the policies prove unpopular — as costly policies often do — and have few loyal supporters, they will fall by the wayside as political fortunes wax and wane.
2) Leaders want to steer clear of blame or failures
Governments are often also loath to commit to targets they might not meet. It’s one thing to underpromise and overdeliver — and quite another to overpromise and underdeliver. When governments set their targets, they worry that they will look ridiculous when they fail to meet their own ambitions and come under criticism by other governments. In the Paris agreement, most countries’ initial pledges were generally conservative and not enough to meet the two-degree target.
In practice, this means that governments hedge their bets by making vague or trivial commitments. So a country that doesn’t rely on coal might ban coal use, for instance. Or a country could pledge net zero emissions by 2050 — a goal so far into the future that it has no practical relevance.
When the Group of 20 — the world’s largest economies — “reiterate [their] commitment to sustainable development,” the commitment itself is vague enough that world leaders cannot possibly fail to honor the promise. Or when countries like France, which uses hardly any coal in power generation, promise to shut down their coal-fired power plants, they don’t have to do much to honor the commitment.
3) The Paris agreement is built on the principle of national sovereignty
The 1997 Kyoto Protocol assigned specific emissions targets to industrialized countries. In contrast, the Paris agreement is a bottom-up arrangement and asks countries to choose their own ambition level, or target. The agreement’s pledge-and-review system means countries will review and comment on each other’s progress every few years.
This arrangement is a nod to the principle of national sovereignty in climate diplomacy. After 25 years of experience, negotiators recognized that governments are not ready to commit to reducing their emissions. The future is uncertain, and policies come and go, so commitments to future emissions reductions are not credible and could backfire when they are not met.
But the sovereignty-focused Paris terms raise new concerns, given the global increase in greenhouse gas emissions in 2017. If major emitters are not on track to reduce their emissions, who will cast the first stone? The pledge-and-review approach can work when the vast majority of countries are on track, as the few detractors woul
4) The future of our climate is uncertain
Governments seem neither willing nor able to commit to ambitious emissions-reduction targets, and the Paris agreement gives them a lot of room to maneuver when it comes to promises. Aspiring to limit global warming to 1.5 or 2 degrees Celsius can guide the international community in the right direction and highlight the magnitude of the challenge, but the range of possible future climates is wide. Against this backdrop, here are two things to watch.
First, progress in mitigating climate change will come from policies that are difficult to reverse and create their own political support. Policies that furnish large gains to politically influential groups can survive over time. For example, renewable-energy policies that create profits for politically powerful farmers have proven durable, regardless of electoral outcomes.
Second, what China does is a particularly important question mark. In 2017, China’s coal use increased for the first time in three years while oil and gas demand continued to grow. Under the Paris agreement, China has promised that its carbon dioxide emissions will peak by 2030 — an unambitious target — but last year’s numbers suggest that China’s future emissions are very difficult to predict.
If China continues to invest in clean energy and move away from heavy industry and construction, its emissions may begin to decrease soon and bring the world back on track. But if China’s fossil-fuel demand continues to grow, it will be very hard for the rest of the world to fill the gap.
Johannes Urpelainen is the Prince Sultan bin Abdulaziz Professor of Energy, Resources and Environment at the Johns Hopkins School of Advanced International Studies. He is also the founding director of the Initiative for Sustainable Energy Policy (ISEP).d face pressure to act. But if nobody is on track, then it becomes easier and less awkward to just say nothing.
https://www.washingtonpost.com/news/monkey-cage/wp/2018/06/01/the-paris-agreements-emissions-goals-may-be-in-trouble-with-or-without-u-s-participation/?utm_term=.c043b5ed22d5
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