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ACC AM Mar 26
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(ACC Mentioned) U.S. Chemical Production Has Highest Year-Over-Year Gain Since 2010
Mar 25, 2015 | Powder & Bulk Solids
According to the American Chemistry Council (ACC), as measured on a three-month moving average (3 MMA) basis, the U.S. Chemical Production Regional Index (U.S. CPRI) continued to expand, rising by 0.2 percent in February following a downwardly revised 0.3 percent gain in January. The gain in February was the eleventh consecutive... -
(ACC Mentioned) North America to Remain Competitive as Chemical Producing Region, says ExxonMobil Chemical Senior Vice President
Mar 25, 2015 | Digital Journal
ExxonMobil sees North America's chemical feedstock and energy costs remaining among the lowest in the world, Matt Aguiar, senior vice president at ExxonMobil Chemical Company, said today in a speech at the IHS World Petrochemical Conference. “We expect North America to remain competitive with other regions as a chemical producer. And we see continued growth in jobs, growth in production and growth in U.S. chemical exports,”... -
(ACC Mentioned) Revision to California Chemical Warnings Law Would Increase Litigation, Businesses Say
Mar 26, 2015 | BNA Daily Environment Report
By Carolyn Whetzel
California's Office of Environmental Health Hazard Assessment's proposed revisions to Proposition 65 warning requirements would create new opportunities for private enforcement actions, not limit them, business and industry groups said at a public hearing in Sacramento. The proposal needs more work before it becomes a final rule... -
EPA's TSCA Reporting Rule For Nanomaterials Will Guide Future Policies
Mar 25, 2015 | InsideEPA
By Dave Reynolds
EPA says its proposed one-time Toxic Substances Control Act (TSCA) rule to collect data on existing nanoscale materials will guide its future nano policies including potential additional reporting requirements and possible TSCA regulation of some nanomaterials if EPA finds the particles pose risks to human health or the environment. -
Chemical Manufacturers, Processors To Report Basic Data Under EPA Proposal
Mar 26, 2015 | BNA Daily Environment Report
By Pat Rizzuto
Companies that make or process nanoengineered chemicals would be required to submit basic information to the Environmental Protection Agency, under a proposed rule the EPA released online March 25. The proposed rule, authorized by Section 8(a) of the Toxic Substances Control Act (TSCA), also would apply to companies that plan... -
Report Addresses Managing Nanotech Risks
Mar 26, 2015 | BNA Daily Environment Report
Participants in a workshop on the potential risks of nanotechnology repeatedly cited the need for more widely used standards for testing methods, exposure thresholds and procedural guidelines, according to a report released March 20. The workshop, held by the National Nanotechnology Initiative in September 2013, was designed to examine tools and... -
EPA To Regulate Nanosilver Pesticides, Seek Safety Data On Nanoscale Chemicals
Mar 25, 2015 | Chemical & Engineering News
By Cheryl Hogue
The Environmental Protection Agency on March 25 unveiled two precedent-setting regulatory moves on nanomaterials. First, the agency will require registration under the federal pesticides law of products containing nanoscale silver that are designed to control microbes. EPA will not, however, classify all nanosilver products as... -
CPSC Probing Lumber Liquidators Flooring For Formaldehyde; Inquiry Could Take Months
Mar 26, 2015 | BNA Daily Environment Report
By Martina Barash
The Consumer Product Safety Commission is investigating whether formaldehyde levels in Lumber Liquidators Inc.'s Chinese-made laminated wood flooring are excessive, CPSC Chairman Elliot Kaye said in a call with reporters March 25. Lumber Liquidators has been cooperative, but the CPSC's timeline for getting samples tested, assessing the ... -
White House to Call on Safety Agency Head to Resign
Mar 25, 2015 | National Journal
By Jason Plautz
President Obama plans to call on the head of the Chemical Safety Board to step down amid increasing congressional scrutiny over mismanagement and personnel trouble at the safety agency, according to multiple sources familiar with the decision. An aide for the House Oversight and Government Reform Committee, which has... -
Oklahoma Legislature Clears Bills to Preempt Local Efforts to Control Oil, Gas Activities
Mar 26, 2015 | BNA Daily Environment Report
By Paul Stinson
Oklahoma lawmakers took a first step toward modifying the authority of municipalities to regulate oil and gas drilling or production, passing a series of measures March 11 and 12 that the state sees as clarifying regulatory authority and that environmental opponents criticize as a cumulative “threat” to discourage cities and towns from enacting ... -
Lifting U.S. Oil Export Ban Won't Increase Gasoline Prices for Consumers, Study Says
Mar 26, 2015 | BNA Daily Environment Report
By Dawn Kopecki
Lifting a 40-year-old ban on U.S. oil exports won't lead to higher gasoline prices for consumers at the pump, according to a study. The export ban distorts crude prices in the U.S., where domestic production has surged, according to the study released March 25 by the James A. Baker III Institute for Public Policy at Rice University. -
Gas Industry Asks White House To Scrap NEPA Emissions Guidance
Mar 25, 2015 | E&E News PM
By Hannah Northey
Natural gas producers are warning the White House that a proposed guidance for addressing greenhouse gas emissions in federal environmental reviews could retard construction of infrastructure needed to meet new climate change objectives. The Natural Gas Supply Association in a letter urged the Council on Environmental Quality to... -
EPA's Critics Push Back On NGA Plan To Help States Attain GHG Targets
Mar 25, 2015 | InsideEPA
By Dawn Reeves
A plan by the National Governors Association (NGA) to help four coal-heavy states craft plans for attaining EPA greenhouse gas (GHG) targets for existing power plants is prompting backlash from rule opponents who complain that the NGA effort is being run by an ex-EPA official and other experts who were previously associated with what they... -
Justices Appear to Have EPA’s Back in Power Plant Case
Mar 26, 2015 | PoliticoPro
By Erica Martinson
The EPA appeared to sway the majority of the Supreme Court during Wednesday’s debate on a landmark power plant pollution rule — and one justice, Stephen Breyer, even seemed to wish he could have written better arguments for the agency. Breyer’s pet subjects include cost-benefit analysis, an issue at the heart of the dispute on an EPA rule... -
Justices Appear Split On EPA Plan For Cutting Toxic Energy-Plant Emissions
Mar 25, 2015 | The Washington Post
By Robert Barnes
The Obama administration’s plan to limit emissions of mercury and other hazardous pollutants from coal- and oil-fired power plants encountered a wall of skepticism from the Supreme Court’s most conservative justices Wednesday. The justices questioned whether the Environmental Protection Agency should have taken into account... -
Briefs Challenge EPA Emissions Plan For Power Plant Near Grand Canyon
Mar 26, 2015 | BNA Daily Environment Report
By William H. Carlile
The Environmental Protection Agency's choice for a source-specific federal implementation plan to reduce nitrogen oxide emissions from the Navajo Generating Station in northern Arizona “is not much of an option,” an environmental attorney who is contesting the action on behalf of three nongovernmental organizations told Bloomberg BNA March... -
Thune Amendment Targets EPA Ozone Standard
Mar 25, 2015 | E&E News PM
By Amanda Peterka
Sen. John Thune (R-S.D.) today offered an amendment to the Senate budget resolution aimed at U.S. EPA's efforts to tighten the national ozone standard. The amendment would reduce the budget of the General Services Administration by $1 million a year until half of the counties currently out of compliance with the 1997 standard meet the limit. -
49 Senators Back Budget Amendment to Bring Down Carbon
Mar 26, 2015 | E&E Daily News
By Jean Chemnick
Nearly half the Senate voted last night for an amendment to the nonbinding fiscal 2016 budget resolution that calls on Congress to address carbon emissions. The amendment by Sen. Bernie Sanders (I-Vt.) was defeated with a vote of 49-50. In language tailored to the underlying resolution, it calls for policies "protecting Americans from the... -
'Vote-A-Rama' Will Put GOP White House Hopefuls Back In Hot Seat On Climate
Mar 26, 2015 | E&E Daily News
By Daniel Bush
The Senate's Republican presidential hopefuls will face a new round of votes on climate policy when a marathon voting session on the budget kicks off today. Democrats plan to offer a series of climate-related amendments to the Senate budget resolution in an effort to single out GOP senators -- including several White House contenders -- who... -
High Court Appears Split on EPA Decision Not to Consider Cost of Mercury Regulation
Mar 26, 2015 | BNA Daily Environment Report
By Patrick Ambrosio
Supreme Court justices appeared to have differing views on whether the Environmental Protection Agency adequately considered the costs of regulating emissions of mercury and other hazardous air pollutants from power plants (Michigan v. EPA, U.S., No. 14-46, argued 3/25/15). The court heard oral arguments March 25 on whether... -
High Court Appears Split Over EPA Air Quality Rule
Mar 25, 2015 | The Hill - E2 Wire
By Lydia Wheeler
The Supreme Court appeared split Wednesday over a challenge to the Environmental Protection Agency's first-ever limits on mercury, arsenic and acid gases emitted by power plants, slated to take effect next month for some plants. The court is tasked with determining whether EPA unreasonably refused to consider costs in deciding whether it was... -
Supreme Court Appears Divided on EPA Rules to Limit Mercury Emissions
Mar 25, 2015 | The Wall Street Journal
By Brent Kendall
The Supreme Court appeared split on Wednesday over whether the Environmental Protection Agency erred when it adopted first-ever regulations requiring power plants to cut emissions of mercury and other toxic air pollutants. The regulations would cost $9.6 billion in annual costs, according to EPA estimates. But the agency said it was ... -
House Panel Approves Bill Giving States More Flexibility in Regulating Coal Ash
Mar 26, 2015 | BNA Daily Environment Report
By Dean Scott
A House Energy and Commerce panel March 25 approved a bill that would give states flexibility in regulating coal ash and would permanently bar the Environmental Protection Agency from regulating the material as hazardous waste. The Subcommittee on Environment and the Economy approved the Improving Coal Combustion Residuals Regulation Act by a vote of 16-5. The panel defeated two Democratic amendments designed to strengthen... -
House Panel Passes GOP Coal Ash Bill
Mar 25, 2015 | The Hill - E2 Wire
By Timothy Cama
A subpanel of the House Energy and Commerce Committee passed a Republican-backed bill aimed at adding certainty to the Environmental Protection Agency’s (EPA) coal ash disposal rule. The bill, sponsored by Rep. David McKinley (R-W.Va.), passed 16 to 5 Wednesday, with three Democrats joining all the Republicans to vote for it. -
EPA's Call For Revisions To House Coal Ash Bill Prompts GOP Opposition
Mar 25, 2015 | InsideEPA
By David LaRoss
EPA's top waste official is calling on House Republicans to revise their draft bill to overhaul parts of the agency's coal ash disposal rule by adopting a “clear” minimum disposal safety standard and other changes, but GOP lawmakers' opposition to such revisions could hinder their ability to win the administration’s support for the bill. -
Kennedy Seen As High Court Swing Vote In Suit Over EPA's Utility MACT
Mar 25, 2015 | InsideEPA
By Stuart Parker
Supreme Court Justice Anthony Kennedy appears to be the swing vote that will determine whether the high court sides with industry and 21 states in finding that EPA erred by not considering costs when deciding to craft an air toxics rule for utilities, with Kennedy raising doubts over both the plaintiffs' and government's arguments. -
Natural Gas Transport Safety on DOT Radar, As Congress, Agencies Address Crude-by-Rail
Mar 26, 2015 | BNA Daily Environment Report
By Rachel Leven
The Transportation Department is adding another energy transport safety issue to the administration's agenda: natural gas. While the administration and Congress are still busy addressing the transport of crude oil by rail, a senior department official told a House Appropriations subcommittee March 25 that reduced flaring in crude oil... -
Railroad Agency, Energy Groups in Spat Over Crude-by-Rail Safety Involvement
Mar 26, 2015 | BNA Daily Environment Report
By Rachel Leven
The Federal Railroad Administration is engaged in a public spat with the energy industry regarding the degree to which different groups are responsible for addressing crude-by-rail safety. The disagreement centers on how involved the rail and energy industries have been in making the transport of crude oil by railroad safer and... -
Panel Approves Bills to Revamp Board, Extend Deadline for Safety Work
Mar 26, 2015 | E&E Daily News
By Sean Reilly
Bills to revamp the Surface Transportation Board and give railroads five more years to complete work on costly new safety systems easily cleared the Senate Commerce, Science and Transportation Committee on voice votes yesterday. But in a sign of possible trouble ahead, three committee members voted against the latter bill, S. 650...
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(ACC Mentioned) U.S. Chemical Production Has Highest Year-Over-Year Gain Since 2010
Mar 25, 2015 | Powder & Bulk Solids
According to the American Chemistry Council (ACC), as measured on a three-month moving average (3 MMA) basis, the U.S. Chemical Production Regional Index (U.S. CPRI) continued to expand, rising by 0.2 percent in February following a downwardly revised 0.3 percent gain in January.
The gain in February was the eleventh consecutive monthly gain. All major chemical producing regions posted consecutive gains in February.
Also measured on a 3MMA basis, chemical production by segment was mixed. There were gains in the output of organic chemicals, chlor-alkali, synthetic rubber, synthetic dyes and pigments, industrial gases, consumer products, and pharmaceuticals. These gains were partially offset, however, by declines in the production of fertilizers, coatings, adhesives, plastic resins, synthetic fibers, acids, pesticides, and other specialty chemicals.
Nearly all manufactured goods are produced using chemistry in some form or another. Thus, manufacturing activity is an important indicator for chemical production. Following a year of gains, manufacturing stumbled in part due to harsh winter weather and West Coast port disruptions. Production expanded, however, in several chemistry-intensive manufacturing industries, including computers and electronic products, plastic products and apparel.
Compared to February 2014, total chemical production in all regions was ahead by 4.2 percent on a year-over-year (Y/Y) basis, its largest gain since July 2010. Chemical production was up from a year ago in all regions.
The chemistry industry is one of the largest industries in the U.S., an $812 billion enterprise. The manufacturing sector is the largest consumer of chemical products, and 96 percent of manufactured goods are touched by chemistry. The U.S. CPRI was developed to track chemical production activity in seven regions of the United States. It is comparable to the U.S. industrial production index for chemicals published by the Federal Reserve. The U.S. CPRI is based on information from the Federal Reserve. To smooth month-to-month fluctuations, the U.S. CPRI is measured using a three-month moving average (3MMA). Thus, the reading in February reflects production activity during December, January, and February. -
Mar 25, 2015 | Digital Journal
ExxonMobil sees North America's chemical feedstock and energy costs remaining among the lowest in the world, Matt Aguiar, senior vice president at ExxonMobil Chemical Company, said today in a speech at the IHS World Petrochemical Conference.
“We expect North America to remain competitive with other regions as a chemical producer. And we see continued growth in jobs, growth in production and growth in U.S. chemical exports,” Aguiar said.
Aguiar explained that the petrochemical industry is the world's largest industrial energy user, and the only one that uses energy for both fuel and feedstock. “Today, the production of chemicals accounts for about 15 percent of global oil demand and 10 percent of natural gas demand – and includes more than 45 percent of the demand for natural gas liquids,” he said.
He pointed out that U.S. output of ethane, propane and other natural gas liquids has risen by more than 65 percent since 2008. “American chemical producers will continue to have an abundant long-term supply of ethane and other natural gas liquids for feedstock,” he said.
Rising production of natural gas liquids, or NGLs, is driving a global shift toward NGLs as a chemical feedstock, Aguiar said. “Naphtha remains the number one steam-cracker feedstock, accounting for more than 50 percent of global demand. Ethane and other NGLs are second, at about 30 percent. However, ExxonMobil sees demand for NGL feedstock rising by about 125 percent through 2040, compared to 70 percent for naphtha. As a result, we expect NGLs to surpass naphtha as the top feedstock in the chemical sector by around 2025.”
The American Chemistry Council projects that U.S. exports of plastics and other chemical products will double from 2014 to 2030, Aguiar pointed out. “Export capacity will increase as planned U.S. chemical expansions move forward, including ExxonMobil's project at Baytown, Texas,” he said.
Construction at ExxonMobil’s project has been underway for 10 months, Aguiar said. “During this time, we have had about 4,000 workers on site representing a range of disciplines, including carpenters, electricians, welders, and ironworkers,” he said. “Foundation and underground work will be completed over the next few months, followed by installation of steel structures and equipment, and then piping, electrical and instrumentation.”
When the Baytown expansion is completed in 2017, ExxonMobil will have added 1.5 million tons per year of steam-cracker capacity. The ethylene feedstock will be used for downstream chemical processing, including processing at two new 650,000-tons-per-year high-performance polyethylene lines at the company’s Mont Belvieu plastics plant.
The expansion is creating a total of 10,000 construction jobs and is projected to add 4,000 new, permanent local jobs, including 350 positions at the ExxonMobil plants.
About ExxonMobil Chemical
ExxonMobil Chemical is one of the largest petrochemical companies worldwide. The company holds leadership positions in some of the largest-volume and highest-growth commodity petrochemical products in the world. ExxonMobil chemical has manufacturing capacity in every major region of the world, serving large and growing markets. More than 90 percent of the company’s chemical capacity is integrated with large refineries or natural gas processing plants.
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Mar 26, 2015 | BNA Daily Environment Report
By Carolyn Whetzel
California's Office of Environmental Health Hazard Assessment's proposed revisions to Proposition 65 warning requirements would create new opportunities for private enforcement actions, not limit them, business and industry groups said at a public hearing in Sacramento.
The proposal needs more work before it becomes a final rule, the California Chamber of Commerce, American Chemistry Council and other groups said at the March 25 hearing.
Environmental health advocates said the proposal would improve the warning requirements.
OEHHA launched the rulemaking in January and has a year to adopt the final rule, Carol Monahan Cummings, the agency's chief counsel, said (11 DEN A-16, 1/16/15).
“We do anticipate one more round of changes and comment period before we adopt the regulation,” she said.
Written comments on the current proposal are due by 5 p.m. April 8, Monahan Cummings said.
‘Clear and Reasonable’ Warnings
As currently proposed, the rule would repeal and replace a section of the regulations to implement the state's landmark right-to-know law to provide more specific guidance for the “clear and reasonable” warnings businesses must provide when knowingly exposing the public to a chemical that has been linked to cancer or reproductive harm through one of four processes identified in the regulations.
In a related but separate rulemaking, OEHHA has proposed development of a website that would provide public information about the 800 chemicals on the Proposition 65 list, including exposure routes and how to minimize exposures.
The proposal is a move to implement reforms to Proposition 65, officially known as the Safe Drinking Water and Toxic Enforcement Act of 1986. Gov. Jerry Brown (D) has sought to reduce litigation over the warning requirements and create more informative warnings.
New provisions in the proposal would make it clear that manufacturers have the primary responsibility for warning and notifying retailers of the need to warn customers. Retailers would have to acknowledge receipt of the manufacturers' notices.
The wording of the warnings also would be changed. Instead of stating “This product contains a chemical known to the State of California to cause cancer,” or alternatively “cause birth defects or reproductive harm,” the warnings would state “This product can expose you to a chemical. …”
Provision Would Require Naming 12 Chemicals
A key worry among businesses and industry groups is a provision that would require naming 12 specific chemicals on warning labels. OEHHA has singled out acrylamide, arsenic, benzene, cadmium, carbon monoxide, chlorinated tris, formaldehyde, hexavalent chromium, lead, mercury, methylene chloride and phthalates for those warnings.
The proposal also falls short of providing businesses the kind of certainty about the warnings needed, Anthony Samson of the California Chamber of Commerce said at the hearing.
“These are dual and conflicting rules and fertile ground for litigation,” Samson said. The majority of Proposition 65 lawsuits or threatened litigation have nothing to do with the content of the warnings, he said.
Also, the proposed revisions “disregard the governor's call” for reforms to eliminate frivolous lawsuits,” Samson said.
Individual businesses took issue with OEHHA's claims that the new warning requirements would not have an economic impact on businesses.
“That's laughable,” Mike Pearce of W.S. Dodge Oil Co. said. The proposal would come with significant costs for new labeling, he said.
Oakland-based attorney David Roe, one of the authors of Proposition 65, said that while the proposal seeks to improve consumer warnings, it would make them longer and less likely to be read.
As for the overall proposal, Roe said that “the content seems to be constructive.” The legal language needs to be tightened, he said.
All of the speakers said they would file more extensive written comments.
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EPA's TSCA Reporting Rule For Nanomaterials Will Guide Future Policies
Mar 25, 2015 | InsideEPA
By Dave Reynolds
EPA says its proposed one-time Toxic Substances Control Act (TSCA) rule to collect data on existing nanoscale materials will guide its future nano policies including potential additional reporting requirements and possible TSCA regulation of some nanomaterials if EPA finds the particles pose risks to human health or the environment.
“The proposal is not intended to conclude that nanoscale materials will cause harm to human health or the environment; Rather, EPA would use the information gathered to determine if any further action under [TSCA], including additional information collection, is needed,” the agency says in a press release on its March 25 release of the pre-publication version of its TSCA reporting and recordkeeping proposal for nanomaterials.
The proposed one-off reporting rule, developed under EPA's TSCA section 8(a) authority, follows years of wrangling with the nano industry and White House officials over how to define and seek better information on the substances.
EPA had sent an earlier proposed rule for White House Office of Management & Budget (OMB) review in 2010, but in 2014 fully withdrew that regulation from review following push-back from industry and others.
The agency then submitted a new compromise proposal for review that included EPA's original proposal to gather information on nanoscale materials already in commerce while dropping plans to develop a broad significant new use rule (SNUR) that would require industry to provide information on nanoscale substances before they enter the market.
OMB completed its review of the new proposal March 19, clearing the path for the agency's release of the pre-publication version and the proposed rule's eventual publication in the Federal Register.
The rule would require submission of data to EPA six months after issuance of the final rule, and the reporting mandate would be a one-time requirement. EPA is also proposing that any company that intends to manufacture a substance that would have been subject to the one-off rule but does not do so until after the effective date of the regulation would have to report to EPA at least 135 days before commencing manufacturing.
In the pending Register notice, the agency says that the reporting proposal is necessary because nanomaterials often exhibit different properties than their macro-scale counterparts, and suggests that information collected through the rule could support possible future regulation of specific nanoscale materials.
“There are many scientific questions about the impacts of chemical substances manufactured at the nanoscale on human health and the environment,” EPA says in the pre-publication document. “Part of EPA’s mission under TSCA is to understand potential risks in order to protect human health and the environment.”
EPA notes that “Being nanoscale is not itself an indication of, or criterion for, hazard or exposure potential.” And says, “Any potential future restrictions on chemical substances manufactured at the nanoscale would be tailored to protect against the specific harms identified for individual substances or categories.”
In the notice, EPA also says it is mulling another possible future rule that would require periodic submissions of information, one of several issues the agency specifically requested comment on during a planned 90-day public comment period, as well as at a public meeting that is to be announced.
EPA will take comment on the proposal for 90 days following its publication in the Register, and is asking for input on issues including the agency's approach for identifying materials subject to reporting requirements, and on substances the agency is excluding from reporting. The agency also requests comments on an exclusion for certain small companies from reporting, and on whether the reporting requirement duplicates other past information collection efforts, as well as on the possible future rule requiring periodic reporting.
Regulating Nanomaterials
EPA and other federal agencies have long struggled with how to regulate nanomaterials in part because of the need to balance potential environmental health and safety risks from use of the substances with industry's desire to avoid over-regulation that could stigmatize the promising technology.
In a March 25 statement announcing the proposed rule, Jim Jones, EPA’s Assistant Administrator for Chemical Safety and Pollution Prevention, emphasized the benefits of nanomaterials.
“Nanotechnology holds great promise for improving products, from TVs and vehicles to batteries and solar panels,” Jones said. “We want to continue to facilitate the trend toward this important technology. Today’s action will ensure that EPA also has information on nano-sized versions of chemicals that are already in the marketplace.”
But the substances also present a unique problem for regulators because of vast differences in performance and toxicity of the particles based on relatively small changes in their properties -- characteristics such as length, size, and coating, among others.
Under the proposal EPA would, for the first time, require companies to within six months of a final rule to submit health and safety data on nanomaterials already in the marketplace. The agency also proposes to request submission of other information, including specific chemical identities, production volume, manufacturing methods, as well as processing, processing, use, and exposure and release information.
In the notice, EPA says the rule is needed because of growing scientific evidence that nanoscale materials are often different from their macro-scale counterparts and may pose novel risks. The agency says the proposed rule would apply to nanoscale substances that have unique properties related to their size.
EPA lists potential benefits of nanomaterials including potential uses in medicine, clean energy and pollution reduction, but adds that their “unique and enhanced properties can raise new questions, such as whether the material in the smaller form may present increased hazards to humans and the environment.”
To support the contention, the proposal cites reports from the National Institute of Occupational Safety and Health and from a panel that advises European regulators noting studies have found certain nanoscale particles pose health risks to workers, and that others may may be toxic to environmental organisms.
Although EPA has sought voluntary disclosure of information on nanomaterials in years past, the agency estimates that companies have submitted information on only about 10 percent of nanomaterials on the market.
While regulators and industry have sought to define nanomaterials for regulatory purposes, the EPA eschews a strict definition and instead sets parameters for determining which substances would require reporting under the proposal.
Specifically, EPA says the rule would apply to substances that “are manufactured or processed in a form where the primary particles, aggregates, or agglomerates are in the size range of 1-100 nanometers and exhibit unique and novel characteristics or properties because of their size.” Meanwhile, the agency recently announced that is it partially approving environmentalists' petition urging the agency to regulate the nanoscale material nanosilver as a pesticide subject to federal registration requirements, but is rejecting advocates' call to undertake broader regulation and launch sweeping enforcement against unregistered nanosilver products already in commerce.
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Chemical Manufacturers, Processors To Report Basic Data Under EPA Proposal
Mar 26, 2015 | BNA Daily Environment Report
By Pat Rizzuto
Companies that make or process nanoengineered chemicals would be required to submit basic information to the Environmental Protection Agency, under a proposed rule the EPA released online March 25.
The proposed rule, authorized by Section 8(a) of the Toxic Substances Control Act (TSCA), also would apply to companies that plan to make or process nanoengineered chemicals.
Many companies could be subject to the data-collection rule. The consumer products market includes more than 1,000 nanomaterial-containing products such as appliances, clothing, electronics, computers, sporting goods and coatings, according to National Institute for Occupational Safety and Health information.
The number of chemicals that, due to their small size and engineering, have special electrical, magnetic, thermal, optical or other properties or features such as improved hardness or strength, is unknown. The agency's proposed rule would help fill that data gap.
Breaking From Past Data-Collection Rules
In a break from previous data-collection rules, the proposed rule would apply to both chemical manufacturers and chemical processors, Lynn Bergeson, managing partner of Bergeson & Campbell P.C., told Bloomberg BNA in a March 25 e-mail.
Processors, which purchase chemicals to mix them into preparations that are distributed for sale, have not traditionally been subject to data-collection rules, she said.
The proposed rule also is unusual because it would establish a one-time reporting requirement and an ongoing reporting requirement, Lawrence Culleen, a partner at the law firm Arnold & Porter LLP, told BNA.
Ongoing reporting requirements are not typically found in data-collection rules, he said.
Affected Chemicals
The chemicals that would be subject to the rule are defined in many ways under the proposal.
These definitions include chemicals having primary particles in the size range of one to 100 nanometers. A nanometer is one billionth of a meter. By comparison, welding fumes measure 10 to 50 nanometers; viruses measure 10 to 60 nanometers; and bacteria can range from 30 to 10,000 nanometers.
Chemicals covered by the rule also would exhibit unique, enhanced and novel characteristics or properties because of their size, the agency said.
Manufacturers and processors of multiple nanoscale forms of the same chemical—such as forms in different sizes or with divergent electrostatic charges—would be required, in some cases, to report the information for each discrete form, the EPA said.
The agency described three ways companies could determine whether the different forms of a chemical made or processed would be considered discrete compounds subject to reporting requirements.
Data Sought
Companies that make or process such nanoengineered chemicals would be required under the proposed rule to submit information including chemical identity; production volume; manufacture methods; processing, use, exposure and release data; and results of available health and safety studies.
Bergeson and Martha Marrapese, a partner at Keller and Heckman LLP, both told Bloomberg BNA that the proposed rule shows the agency has worked very hard to clearly define what chemicals would be covered by the rule and what chemicals would not be covered.
The agency has had many years to give thought to its proposal.
The EPA release of the proposed rule comes nearly a decade after an agency advisory group called for such a regulation, and more than four years after the Office of Management and Budget began to review a first version, and then a second version, of the proposal (195 DEN A-6, 10/8/14).
Reasons Data Sought
Nanoengineered chemicals are of interest to the agency because of the special properties they can have and the characteristics they can exhibit, the EPA said.
These properties and characteristics give the chemicals the potential to provide many benefits, the agency said. For example, nanoengineered chemicals have been used to break down pollutants far more quickly than traditional chemicals.
“However, these unique and enhanced properties can raise new questions, such as whether the material in smaller form may present increased hazards to humans and the environment,” the agency said.
The proposed rule is designed to provide the agency with a scientific foundation for future assessments of these chemicals to enable society to enjoy their benefits while avoiding harm to human health or the environment, the EPA said.
The information also may help the agency eventually to classify different types of nanoscale chemicals into categories that will ease reviews. The EPA is working with the Organization for Economic Cooperation and Development on ways to categorize different nanomaterials (184 DEN A-9, 9/23/14).
Small Companies Excluded; Definition Proposed
As required by TSCA, small manufacturers and processors would be excluded from the data-collection regulation.
The definition of a small business is challenging because—due to their small size and the expense of producing them—nanoengineered chemicals tend to be made in smaller volumes than many other chemicals.
The agency proposed to define small companies as those with annual sales below $4 million. The company's production volume would not be factored into the agency's consideration of whether or not the company is small, the EPA said.
Comment on the definition is sought, the agency said.
Other issues on which the agency specifically sought comment include:
• whether or not the definition of chemicals subject to the rule is sufficiently encompassing;
• the requirement to submit information 135 days prior to making or processing a nanoengineered chemical; and
• the possibility of expanding a different data-collection regulation, known as the Chemical Data Reporting rule, to include nanoengineered chemicals.
What's Next; Commentary on Proposal
When published in the Federal Register, the proposed rule will be open for comment for 90 days.
The EPA said it anticipates holding a public meeting during that comment period. The time and place of the meeting will be announced on the EPA web page.
In her e-mail, Bergeson said the proposed rule is long overdue and the agency's persistence in finally getting it released is laudable.
EPA needs the requested information to enable the agency to confidently conclude nanoscale versions of existing chemical substances do not pose an unreasonable risk, she said.
Culleen said the agency's proposal to require chemical manufacturers and processors to submit information 135 days before making or processing a nanoengineered chemical raises an interesting question. If the information a company submitted raised a possible concern, how would the agency address that concern, Culleen asked.
Parties may comment on this issue in remarks submitted to the agency, he said.
Marrapese said Section 8(a) may not give the agency the authority to issue an ongoing data-collection obligation, especially one that would single out chemicals based on their size and novel characteristics and properties.
The agency's proposal to require an information submission 135 days before a company makes or processes a nanoengineered chemical would impose a burden that no other chemical manufacturer or processor faces, she said.
That requirement runs counter to other sections of the EPA proposal, where the agency said it does not view nanomaterials as posing an inherent risk, Marrapese said.
The reporting requirement would be a significant ongoing burden and could discourage companies from using nanomaterials, she said.
Vague terms such as unique and novel should be defined or avoided altogether in the agency's rule, Marrapese said.
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Report Addresses Managing Nanotech Risks
Mar 26, 2015 | BNA Daily Environment Report
Participants in a workshop on the potential risks of nanotechnology repeatedly cited the need for more widely used standards for testing methods, exposure thresholds and procedural guidelines, according to a report released March 20. The workshop, held by the National Nanotechnology Initiative in September 2013, was designed to examine tools and practices to assess and manage the potential risks associated with exposure, look at how specific perspectives can affect those practices and consider how the nanotechnology initiative can foster the responsible development of nanomaterials. The report summarizes the main topics discussed at the workshop, illustrates recurring themes and paraphrases the participants and presenters' statements. The report, “Stakeholder Perspectives on Perception, Assessment, and Management of the Potential Risks of Nanotechnology,” is available at http://www.nano.gov/R3report.
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EPA To Regulate Nanosilver Pesticides, Seek Safety Data On Nanoscale Chemicals
Mar 25, 2015 | Chemical & Engineering News
By Cheryl Hogue
The Environmental Protection Agency on March 25 unveiled two precedent-setting regulatory moves on nanomaterials.
First, the agency will require registration under the federal pesticides law of products containing nanoscale silver that are designed to control microbes. EPA will not, however, classify all nanosilver products as pesticides, the agency says in a response to a 2008 petition from activist groups that are seeking stronger regulation of nanomaterials. The agency indicated it would not immediately act against unregistered antimicrobial nanosilver products, such as socks, now sold in the U.S.
Second, EPA separately proposed a one-time requirement for makers of nanoscale commercial chemicals currently on the market to notify the agency about all available health and safety data for their products. Under this Toxic Substances Control Act proposal, these manufacturers would also have to submit production volume and processing, use, exposure, and release information to EPA.
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CPSC Probing Lumber Liquidators Flooring For Formaldehyde; Inquiry Could Take Months
Mar 26, 2015 | BNA Daily Environment Report
By Martina Barash
The Consumer Product Safety Commission is investigating whether formaldehyde levels in Lumber Liquidators Inc.'s Chinese-made laminated wood flooring are excessive, CPSC Chairman Elliot Kaye said in a call with reporters March 25.
Lumber Liquidators has been cooperative, but the CPSC's timeline for getting samples tested, assessing the data and drawing conclusions is “months, unfortunately, not weeks,” Kaye said.
The agency will take a testing approach that aims to mimic the way the products are used in the home, Kaye said. The outside laboratories performing the tests will employ an ASTM small-scale chamber method to assess emissions, rather than a “deconstructive” method used by the California Air Resource Board, he said. Lumber Liquidators reportedly opposes the deconstructive method.
Data from both an emissions test and a deconstructive test formed the basis for conclusions in a March 1 “60 Minutes” report finding that flooring samples exceeded California formaldehyde limits (46 DEN A-10, 3/10/15).
Efforts Coordinated
The CPSC is coordinating its efforts with several other federal agencies, including the Environmental Protection Agency, the Agency for Toxic Substances and Disease Registry, and the Centers for Disease Control and Prevention, Kaye said.
The CPSC will be relying on its federal partners, particularly in assessing the effects of long-term exposure to the laminates, he said.
Kaye took pains to manage expectations about the ultimate results of the CPSC's tests.
“Often science doesn't provide clarity,” he said. “The science is well-developed, but not fully developed, on risk, especially for long-term exposure,” he said.
Limitations on Agency
Kaye criticized the limitations placed on the agency by Section 6(b) of the Consumer Product Safety Act, which requires notice to a company and a 15-day response period before the agency can disclose information about that company's product, including whether an investigation is underway.
Section 6(b) is an “anti-consumer safety and anti-transparency” provision, Kaye said on the call with reporters. He said it is “highly frustrating” to have information he can't share in a more timely manner with the public about a company's product. “I don't think that furthers public safety,” he said.
Kaye said the CPSC may expand the inquiry beyond Chinese-made laminate or beyond Lumber Liquidators, if it has a reason to do so.
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White House to Call on Safety Agency Head to Resign
Mar 25, 2015 | National Journal
By Jason Plautz
President Obama plans to call on the head of the Chemical Safety Board to step down amid increasing congressional scrutiny over mismanagement and personnel trouble at the safety agency, according to multiple sources familiar with the decision.
An aide for the House Oversight and Government Reform Committee, which has held multiple hearings on CSB management, told National Journal that the White House had notified them of plans to call for the resignation of Rafael Moure-Eraso from the Chemical Safety Board.
The White House and the CSB did not respond to requests for comment.
Moure-Eraso has just about three months left in his five-year term as chairman of the CSB, the independent agency tasked with investigating chemical accidents and issuing recommendations to prevent them. His term has been marked by turmoil and charges that he has created a toxic environment for employees at the agency, and several members of Congress recently called for his ouster.
In a joint statement, Oversight Committee chairman Jason Chaffetz, R-Utah, and ranking member Elijah Cummings, D-Md., said they were "pleased that the president has recognized the importance of making key changes with the Chemical Safety Board."
"Dr. Moure-Eraso's mismanagement of the CSB, abuse of power, employee retaliation, and lack of honesty in his communications with Congress are among the many reasons why his resignation is the right next step for this federal agency," they wrote. "We remain hopeful that progress will continue to be made with regards to improving leadership and morale issues within the CSB."
Moure-Eraso was hauled before the House Oversight and Government Reform Committee earlier this month to discuss an EPA Inspector General report that he and two top CSB officials had used personal email accounts for official business, in part to evade other CSB employees. Documents revealed at the hearing had found that the practice continued even after Moure-Eraso had assured Congress it had stopped, although CSB says they have complied with federal record-keeping laws.
The Oversight Committee also charged that a CSB employee had been removed from an outside contract and demoted after working with a consulting firm on a report that criticized management at the agency.
Following the hearing, a bipartisan group of 14 committee members wrote a letter to Obama saying that "CSB is in a state of turmoil" and calling on him to remove three top officials: Moure-Eraso, general counsel Richard Loeb, and managing director Daniel Horowitz. Senate Environment and Public Works Committee Chairman James Inhofe and Sen. Mike Rounds separately wrote to Obama asking him to remove Moure-Eraso.
Moure-Eraso's tenure has been dogged by charges that he has bungled the agency's mission and driven away staff members. Several senior investigators left the agency, citing a work environment that discouraged debate and sapped morale. Board member Beth Rosenberg even quit a year into a five-year term, later saying that she felt marginalized and demoralized.
There have been further questions about a board order passed in a late-night January meeting that wiped away several management reforms and appeared to consolidate power in the chairman's position, although the board member who introduced it said he was just streamlining the organization.
The White House this month nominated Vanessa Allen Sutherland, the chief counsel at the Pipeline and Hazardous Materials Safety Administration, to chair the CSB for a term that would begin in June.
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Oklahoma Legislature Clears Bills to Preempt Local Efforts to Control Oil, Gas Activities
Mar 26, 2015 | BNA Daily Environment Report
By Paul Stinson
Oklahoma lawmakers took a first step toward modifying the authority of municipalities to regulate oil and gas drilling or production, passing a series of measures March 11 and 12 that the state sees as clarifying regulatory authority and that environmental opponents criticize as a cumulative “threat” to discourage cities and towns from enacting meaningful regulation.
Passing the Oklahoma House March 11 in a 69-26 vote, H.B. 2178 would give exclusive jurisdiction over oil and gas operations—including exploration, drilling, fracture stimulation, production and plugging—to the state's oil and gas regulator, the Oklahoma Corporation Commission (OCC).
Authored by House Speaker Jeff Hickman (R) and Senate President Pro Tem Brian Bingman (R), municipalities and other political subdivisions would be prohibited from banning any of these practices or regulating them in a way that is not consistent with OCC regulations, according to a bill summary.
“This bill acknowledges local governments' right to set requirements for public safety near drilling sites while safeguarding the state's clear and reasonable drilling policies,” Hickman said in a March 12 release.
“We are seeing a trend in neighboring states of a handful of activists derailing energy operations using pseudoscience as the basis of their argument,” Hickman said, referring to the ban on hydraulic fracturing approved by voters in Denton, Texas, in November (215 DEN B-12, 11/6/14).
“The energy industry is a key factor in our state's growing success, and policy decisions should not be driven by inaccurate and baseless attacks,” he said.
According to the bill, a municipality “may also establish setbacks and fencing requirements for oil and gas well site locations as are reasonably necessary” to protect the health, safety and welfare of its citizens, “but may not otherwise regulate, prohibit or ban any oil and gas operations.”
The bill would repeal Section 137 of the Oklahoma statute governing oil and gas (Title 52). That statute gives cities and towns the authority to prevent oil and gas drilling.
“They simply want to control what local governments can and cannot do regarding oil and gas enterprise,” Oklahoma Sierra Club Director Johnson Bridgwater told Bloomberg BNA in a March 11 e-mail.
“H.B. 2178 had a floor amendment brought forward that addressed reasonable setback language and they tabled it,” Bridgwater said. “Very clearly, they have no real interest in protecting our citizens.”
The legislation is one of a handful of proposed measures to preempt the authority of municipalities, as cities consider stricter drilling ordinances in response to environmental concerns, including the unprecedented levels of seismic activity in the state.
Stillwater Considers Ordinances
The city of Stillwater, Okla., will consider April 6 an ordinance to update oil and gas drilling regulations for the first time since 1978. Part of that update could include a re-tooled ordinance containing setback rules that would prevent well sitings from occurring near homes, hospitals and other structures.
A city spokeswoman told Bloomberg BNA that the Stillwater City Council had asked the city attorney to go back to the drawing board on an ordinance after a 2-2 city council vote failed to support an ordinance that would have prevented all new mining activity—including oil and natural gas drilling—on zoned agricultural land within city limits.
Compensation From Cities
Following an initial wave of bills in February seeking to change the authority of cities and towns to regulate oil and gas drilling or production, the Oklahoma Senate March 12 passed a bill (S.B. 468) that would require municipalities or counties to pay mineral owners affected by an action of local government.
Authored by state Sen. Bryce Marlatt (R), who also chairs the Senate energy committee, the Senate approved the bill on a 37-4 vote. The measure is now being considered by the state House.
S.B. 468 stipulates that a local government's adoption or implementation of an ordinance that reduces “the fair market value” of the mineral interest of the owner by at least 60 percent would be considered a taking of the owner's interest for a public use.
Under those circumstances, the owner has the right to obtain compensation from the local government “for the full diminution in the fair market value of the mineral interest caused by the regulatory impairment by the local government,” according to the legislation.
“S.B. 468 and S.B. 809 both seek to hold cities and towns financially responsible (the ‘takings' clause) for any mineral interests that might be affected by municipal ordinances dealing with oil and gas,” Bridgwater said.
Also authored by Hickman and Bingman, S.B. 809 passed the Oklahoma Senate March 11 in a 36-7 vote.
According to S.B. 809, whenever a municipality, county or other political subdivision other than the OCC adopts or implements an ordinance concerning oil and gas operations that has the effect of “substantially interfering with use and enjoyment of the mineral estate” or “exercising dominion and control” over it, “it shall be considered a taking.”
“We feel this is being used as a threat against cities and towns to try to scare them away from enacting any ordinances with real teeth,” Bridgwater said.
“Most small towns are barely able to pay their fire department expenses, let alone have to worry about paying legal claims as a result of them trying to protect their citizens,” he said.
While Oklahoma environmental groups have long campaigned for more stringent setback rules to protect homeowners from drilling in their close proximity, groups advocating for mineral owners have long lamented that the local bans unconstitutionally interfere with their rights.
Responding to an inquiry about the legislature's efforts to rescind drilling control from municipalities, Terry Stowers, executive director of the Coalition of Oklahoma Surface and Mineral Owners (COSMO), referred Bloomberg BNA to a series of talking points jointly issued by COSMO and the Oklahoma Oil and Gas Association (OKOGA) in support of H.B. 2177 and S.B. 807, measures that would rename the 2011 Shale Reservoir Development Act as The Extended Lateral Horizontal Well Development Act.
Authored by Hickman and Bingman, the measure would allow oil and gas developers to obtain permission from the OCC to join units for drilling extended lateral-horizontal wells across multiple units outside of shale formations.
Repeated requests for further comment on S.B. 468 to the Coalition of Oklahoma Surface and Mineral Owners and the Oklahoma Oil and Gas Association were not answered. An e-mail seeking comment from Sen. Marlatt received no response.
Seismicity Concerns Pervade
Bridgwater said the multiple efforts to limit local regulation of oil and gas activities are particularly troubling in the absence of state action, compounded further by unprecedented levels of seismic activity in the state.
Oklahoma overtook California in the continental U.S. for earthquakes of 3.0 magnitude or greater in 2014, with more than 500, tripling 2013 levels. Those two years tower over a relative period of quiet from 1975-2008 of 56 earthquakes in that category, according to data from the Oklahoma Geological Survey.
Seismic activity over the 2009-2014 period “far exceeds historic seismicity,” according to a Dec. 30 report published by the OGS. “In a few cases, has been correlated to subsurface fluid injection in the midcontinent.”
“[E]arthquakes in Oklahoma are at an all-time high, with clear evidence that fracking and its related aspects are likely culprits—and yet OCC has not taken any significant action to stop this trend in earthquake activity, nor, again, done anything aimed to proactively protect Oklahoma's cities and towns,” said Bridgwater.
Traffic-Light Protocol Response
Oklahoma Corporation Commission spokesman Matt Skinner countered that assertion in a March 9 e-mail to Bloomberg BNA, pointing to the state's use of a “traffic light system” of best practices as a means for addressing seismicity (148 DEN BB-1, 8/1/14).
“It is an ever-evolving process, and we certainly don't look at it as the final answer,” Skinner told Bloomberg BNA in a March 9 e-mail. “Nothing has a higher priority at the Commission than this.”
Under a green light, an operator is free to inject fluids; under a red light, injection would be stopped to allow for further investigation.
After its initial September 2013 launch, the OCC in May 2014 instituted a “yellow light” as part of the system's evolution, having the effect of withholding administrative approval to any disposal well within 3 miles of a stressed fault or 10 kilometers (km, about 6.2 miles) of a seismic swarm, regardless of magnitude. Approval also would be withheld from any application for a disposal well within 10 km of a magnitude 4 or greater earthquake.
The state enacted 20 well shut-ins as of Feb. 5, according to data provided by the commission.
Efforts to appoint all oversight to the OCC, said Bridgwater, amounts to a legislative attempt “to rewrite the constitution,” which he said was clear in giving local government the right to control oil and gas enterprise in their municipalities.
“[B]y using ‘takings' language, these legislators are attempting to scare cities and towns away from any substantial regulation,” said Bridgwater.
“Given that OCC is already underfunded, and that under their current administration, the earthquakes continue unabated, we feel the OCC will be hard-pressed to make significant progress on this issue on their own.”
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Lifting U.S. Oil Export Ban Won't Increase Gasoline Prices for Consumers, Study Says
Mar 26, 2015 | BNA Daily Environment Report
By Dawn Kopecki
Lifting a 40-year-old ban on U.S. oil exports won't lead to higher gasoline prices for consumers at the pump, according to a study.
The export ban distorts crude prices in the U.S., where domestic production has surged, according to the study released March 25 by the James A. Baker III Institute for Public Policy at Rice University. Its conclusions support oil producers who are pressuring Congress and the Obama administration to lift the ban amid a slump that has seen prices fall by about 50 percent since June.
U.S. oil sells for an average of about $8 a barrel less than the global benchmark. Because refined products such as gasoline, which can be exported, trade in parity with international products, lifting the crude export ban won't raise gasoline prices, Kenneth Medlock, author of the study and a fellow at the Baker Institute, said in a statement.
“The discounted prices of oil produced in the U.S. are not reflected in U.S. gasoline and refined product prices,” Medlock said. “Thus, removing the crude export ban, although it would raise the price of crude oil domestically, would not increase the price of gasoline in the U.S.”
Ending the ban also would boost U.S. energy security by providing a more secure source of crude to world markets, Medlock said.
About a dozen U.S. drilling executives, including ConocoPhillips Chief Executive Officer Ryan Lance, were in Washington earlier in March trying to persuade White House officials and lawmakers to lift the ban, according to two people familiar with the meetings.
Their efforts so far have failed to produce a significant move in Congress to allow exports. Even the Senate's top advocate for the idea, Sen. Lisa Murkowski, a Republican from oil-rich Alaska, hasn't proposed legislation.
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Gas Industry Asks White House To Scrap NEPA Emissions Guidance
Mar 25, 2015 | E&E News PM
By Hannah Northey
Natural gas producers are warning the White House that a proposed guidance for addressing greenhouse gas emissions in federal environmental reviews could retard construction of infrastructure needed to meet new climate change objectives.
The Natural Gas Supply Association in a letter urged the Council on Environmental Quality to withdraw its proposal for how agencies should factor climate change into environmental reviews of new projects.
At issue is a guidance released in December that some analysts say would encourage agencies like the Federal Energy Regulatory Commission to consider the upstream and downstream effects of gas pipelines, compressor stations and export terminals (Greenwire, Dec. 19, 2014).
CEQ first released draft guidance in 2010 but never issued a final plan, much to the frustration of some environmentalists. The White House released the revised guidance last year and opened it for public comment for 60 days.
In a letter, Jenny Fordham, NGSA's senior vice president of government affairs, told CEQ the proposed guidance could "improperly and unnecessarily" alter several NEPA statutory and regulatory obligations. And depending on how it's applied, the revised draft guidance could slow projects that are critical to complying with national environmental objectives, she said.
NGSA's membership includes industry giants like Anadarko Petroleum Corp., BP, Chevron, ConocoPhillips Co., Devon Energy Corp., Exxon Mobil, GDF Suez Energy, Marathon Oil Corp. and Shell Energy North America.
Fordham said CEQ's suggestions would "defeat the purpose of a proper NEPA review -- informed agency decision making" on projects, as it would distract regulators by forcing them to instead focus on greenhouse gas emissions and climate change. Those issues, she said, are speculative and outside the agencies' jurisdiction and control.
"Simply put, natural gas infrastructure development, or any agency action, should not hinge on analysis of GHG emissions and climate change factors that are so variable and elusive that they cannot be soundly qualified," she wrote.
The gas industry in recent months has touted the fuel's ability to curb greenhouse gas emissions. Fordham noted that market-driven consumption of gas for electricity has driven carbon emissions below 2005 levels.
FERC Chairwoman Cheryl LaFleur told reporters earlier this month that the agency is reviewing the guidance.
LaFleur in the past has said FERC would consider any new guidance or rules that environmental regulators release, while defending the commission's approach. She has said FERC is already assessing direct and reasonably foreseeable emissions from proposed projects in NEPA reviews.
The commission also has said there's no reliable formula for measuring the local or global environmental impacts of cumulative emissions from any pipeline, compressor station or liquefied natural gas export terminal.
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EPA's Critics Push Back On NGA Plan To Help States Attain GHG Targets
Mar 25, 2015 | InsideEPA
By Dawn Reeves
A plan by the National Governors Association (NGA) to help four coal-heavy states craft plans for attaining EPA greenhouse gas (GHG) targets for existing power plants is prompting backlash from rule opponents who complain that the NGA effort is being run by an ex-EPA official and other experts who were previously associated with what they consider anti-business groups.
“Isn't it NGA's job to advocate for states?” says one EPA critic, questioning the group's motives.
The EPA critics are responding to NGA's new effort “to help states examine cost-effective strategies for meeting the potential requirements” of EPA's proposed existing source performance standards (ESPS) to cut GHGs from the power sector.
NGA's Center for Best Practices tapped four coal-heavy states -- Michigan, Missouri, Pennsylvania and Utah -- to be part of a new “policy academy” working group to “identify various options” to comply with EPA's rule for existing power plants, offering evidence that the states may not reject the plan entirely as Senate Majority Leader Mitch McConnell (R-KY) is urging.
NGA's March 19 announcement came the same day that McConnell sent the group a letter urging governors to “just say no” to submitting an ESPS compliance plan. In his letter, McConnell charged that EPA is “attempting to compel states to do more themselves than what the agency would be authorized to do on its own,” and that the ESPS is on “shaky legal grounds.”
McConnell's “just say no” efforts have been received bluntly by the Obama administration, with EPA Administrator Gina McCarthy telling a Council on Foreign Relations event March 11 that “EPA is going to regulate.” And White House climate advisor Brian Deese told a March 20 Christian Science Monitor event that McConnell is “going way outside the bounds of the position that he was elected to.” Deese added: “We would all be better served if he and others spent less time trying to lecture states about what they should be doing.”
But opponents of the rule are now questioning NGA's motives and whether NGA officials potentially involved may be biased as they previously worked for EPA and/or environmental groups.
The division director of the NGA center's Environment, Energy & Transportation Division is Sue Gander, a former EPA program manager for the agency's Clean Energy-Environment State Partnership Program who also was a senior policy analyst and government relations director for the Center for Clean Air Policy (CCAP), according to NGA's website.
However, Gander has not worked for EPA since 2007, when she started at NGA, according to her public LinkedIn profile. She worked at EPA from 2001-2007, and before that worked at CCAP for seven years.
Another program director at the NGA energy center, Gregory Dierkers, was a senior policy analyst for the CCAP. A third, Aliza Wasserman, worked for pro-family farm groups and the group Business for Social Responsibility.
A senior policy analyst at the NGA energy center, Andrew Kambour, was a member of the Metropolitan Washington Council of Governments' Air and Climate Public Advisory Committee.
How Washington 'Works'
A second EPA critic notes that the NGA announcement prompted questions about who is backing the association's effort, noting that research revealed that the director of the NGA program that will conduct the ESPS compliance academy used to work for EPA. This “serves as a good example of how this town works,” the source complains.
The first opponent wonders why NGA is sending these types of experts “to 'help' states comply?” The source also asks why the group -- whose mission is to “speak with a collective voice on national policy and develop innovative solutions that improve state government and support the principles of federalism” -- is not opposing the ESPS.
But states are deeply split over the ESPS, with many coal states opposing the rule and other states with more renewable energy supporting it. There are also disputes within states. For example, in Kentucky, the GOP attorney general, GOP-controlled legislature and GOP members of Congress oppose the rule, while the Democratic governor does not.
An NGA spokeswoman says the critics may be confused about the role of Center for Best Practices, which is “our non-profit arm where we help governors develop innovative solutions to today's most pressing public policy challenges.” The center also provides technical assistance, shares best practices and hosts meetings. “One of the ways we do this is through policy academies where states who are interested in digging into a particular issue submit proposals that are reviewed by a selection committee.”
The center is completely different from the Office of Federal Relations, which is the NGA arm that advocates on issues and where “we've had briefings at both NGA and EPA . . . to talk about the GHG rule. At those meetings states have had the opportunity to express concerns over the compliance obligations and things EPA can do to consult with governors. We have asked for much more clarity and detail.”
In a related matter, McConnell's “just say no” letter drew some support at a March 23 field hearing of the Senate Environment & Public Works (EPW) Committee in Beckley, WV, chaired by Sen. Shelley Moore Capito (R-WV).
Capito argued that the main point of McConnell's letter was that states should not be forced to make the “difficult decision” about which power plants to close and which communities lose jobs. “If the EPA wants to go in this direction and they're federally allowed to do it, then they're the ones that will have to make the tough decisions,” she said.
Even so, Capito recalled asking Administrator McCarthy during an earlier EPW hearing what would happen if a state does not submit a compliance plan. Her response, that EPA would craft a federal plan, “sent sort of the wrong kind of chills down my spine,” Capito said.
Regarding McConnell's call to not cooperate on ESPS plans, James Van Nostrand, director of West Virginia University's Center for Energy and Sustainable Development, said state officials are in a better position to craft a sound compliance plan than EPA. “We should figure out how to comply with this rule in the manner that has the least disruption to our economy. And I think the states know that better than the EPA,” he said. Under a federal plan, he argued, “compliance costs are going to be higher, and our utility costs are going to be higher than they need to be.”
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Justices Appear to Have EPA’s Back in Power Plant Case
Mar 26, 2015 | PoliticoPro
By Erica Martinson
The EPA appeared to sway the majority of the Supreme Court during Wednesday’s debate on a landmark power plant pollution rule — and one justice, Stephen Breyer, even seemed to wish he could have written better arguments for the agency.
Breyer’s pet subjects include cost-benefit analysis, an issue at the heart of the dispute on an EPA rule that has provoked a nationwide wave of coal-plant shutdowns. And in Wednesday’s oral arguments, he offered a defense that even the EPA had failed to raise in its briefs to the court.
Industry groups complained that the agency had failed to consider the toxic air pollution rule’s billions of dollars in costs before it decided the rule was necessary. But Breyer said the EPA eventually considered the costs in the way it set up the regulation, and had ensured the burdens would be reasonable for plants burning different types of fuel.
Justices Sonia Sotomayor and Elena Kagan spoke even more aggressively in favor of the agency’s approach to the rule, often replying to other justices’ questions before attorneys had the chance to speak. Justices Ruth Bader Ginsburg and Anthony Kennedy also seemed to lean the EPA’s way but asked fewer questions.
The Mercury and Air Toxics Standards, which EPA approved in 2012 after two decades of wrangling, are a crucial part of the Obama administration environmental agenda that the president’s critics label the “War on Coal.” The regulation takes effect April 15 but has already forced owners of the nation’s oldest, dirtiest coal-burning plants to decide whether to invest in the required pollution controls — and in dozens of cases, they’re closing the plants instead.
The challenge against the mercury rule is a prelude to the inevitable legal fight that EPA will face over its upcoming greenhouse gas regulations for power plants. Nothing the justices said during Wednesday’s arguments offered a preview of how they might lean in the climate case.
Wednesday’s arguments focused mainly on a narrow question: whether the EPA should have considered the compliance costs before determining that the mercury rule was “appropriate and necessary” to protect public health.
But Breyer pushed in a new direction, pressing the agency to make it clear it had planned to consider costs later in the rulemaking, when it was setting the standards.
When the EPA was writing the rule, for example, power companies told the agency what technology they use and how much it would cost to upgrade. The agency then spelled out different standards for plants that burn lignite as opposed to other types of coal, along with four categories of oil-burning plants.
“How are they going to do that without” considering cost, Breyer asked at the close of the session.
That argument seemed to hold sway with Kennedy, who’s often the swing justice in 5-4 decisions. “It seems to me that there’s an implicit cost consideration” in the rulemaking process, he said.
Breyer’s argument dominated the justices’ banter. He noted that his take on the issue arose from discussions in his chambers, not from the Justice Department briefs advocating EPA’s case.
Conservative Justice Antonin Scalia probed attorneys about the “provision that Justice Breyer discovered,” implying that Breyer’s after-the-fact rationale may not salvage the EPA’s rule. He later told Solicitor General Donald Verrilli Jr.: “You’re just saying the [Breyer] argument is right, not that the agency said it. It’s not enough to be right.”
Chief Justice John Roberts told Verrilli that EPA should have outlined when and how it would consider costs, and pressed him on where the issue was raised “besides Justice Breyer’s chambers.”
Notable Supreme Court attorney Paul Smith, who was arguing for power industry groups that support the rule, appeared to resolve lingering questions for some of the justices. He told them that while the briefs in the case don’t discuss it, cost considerations are implicit in the rule-setting process as the agency decides what technology is available and how to divide types of power plants.
“You confirm, it was not made up in my chambers,” Breyer said.
Scalia and Justice Samuel Alito both expressed concern about the rule’s costs and whether EPA had directly considered them, while Roberts questioned the weight of EPA’s eventual cost-benefit analysis. Roberts also seemed to be hoping for a more specific argument that he couldn’t get the attorneys to offer.
“I want to know if there’s anywhere where [EPA] said, ‘Don’t worry, we’ll get to cost issues later,’” Roberts said. Smith replied that for all other pollution sources regulated for hazardous air pollution, industry concedes that the agency considers cost as part of the rulemaking process.
Besides, Smith said, utilities have already absorbed the bulk of the expense of complying with the mercury rule. “Most of that $9.6 billion has already been spent,” he said.
The rule arose from the 1990 Clean Air Act Amendments, in which Congress established other major pollution rules for power plants but asked the EPA to wait a few years before studying the health impacts of mercury and toxic chemicals. Then the agency was supposed to decide whether to regulate them too.
Kagan and Sotomayor repeatedly argued that Congress’ intent was clear back then: Lawmakers wanted to allow time for the acid rain program created by the 1990 law to take effect, in case those controls also solved the issue of hazardous air pollution. “The point is that the acid rain program didn’t do what Congress thought it might do,” Kagan said.
Alito disagreed, arguing that Congress obviously chose to treat power plants differently from other sources when it comes to hazardous air pollution.
Often the justices appeared to be arguing the case among themselves instead of questioning the four attorneys in front of them.
The EPA and its supporters say the agency should have leeway to determine whether regulating was “appropriate and necessary” — the language used in the Clean Air Act. But the 21 states and coal and utility industry groups opposing the EPA say Congress would have wanted the agency to weigh the costs first, and that “appropriate” obviously points to considering costs.
Much of the argument concerned the meaning of “appropriate and necessary,” a phrase that the liberal justices warned is generally broad.
“That kind of language is used all over the U.S. Code,” Kagan said, pointing to the Constitution’s Necessary and Proper Clause.
“So why do you get to pick what it means?” Sotomayor asked one anti-EPA attorney, Michigan Solicitor General Aaron Lindstrom. She added that all the court needed to do was find that EPA had taken a reasonable reading of the statute.
“Clearly Congress knows how to require consideration of cost,” Kagan argued.
Roberts said his personal interest in the case involved the agency’s counting of “co-benefits” from cutting soot pollution as part of the rule. Reductions in mercury accounted for only $4 billion of the $30 billion to $90 billion in benefits that EPA estimated the rule would create. Most of the rest of the benefits would come from cutting fine particulate matter.
That was a “red flag,” Roberts said.
Verrilli argued that EPA did not calculate the full benefits of reducing mercury pollution, given the difficulty of quantifying neurological impacts such as attention deficit disorder and developmental delays.
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Justices Appear Split On EPA Plan For Cutting Toxic Energy-Plant Emissions
Mar 25, 2015 | The Washington Post
By Robert Barnes
The Obama administration’s plan to limit emissions of mercury and other hazardous pollutants from coal- and oil-fired power plants encountered a wall of skepticism from the Supreme Court’s most conservative justices Wednesday.
The justices questioned whether the Environmental Protection Agency should have taken into account costs when it first decided to regulate the emissions. The agency said it was supposed to consider only health consequences and whether technology was available to correct the problem. It says costs were to be considered only when implementing the standards the plants were supposed to achieve.
The court’s four consistently liberal justices all voiced support for the EPA’s reading of the law. The outcome, then, would seem to hinge on Justice Anthony M. Kennedy, who gave both sides reason for optimism and concern.
It has taken decades to achieve the EPA’s goal of regulating mercury and other hazardous air pollutants, which are tied to birth defects and developmental problems in children as well as respiratory illnesses. The EPA’s rules are scheduled to take effect next month and be fully in place by 2016.
But they have been challenged by industry groups and 21 Republican-led states in which the older plants mostly are located.
The issue comes down to what Congress meant when it ordered the EPA to study whether it was “appropriate and necessary” to regulate the pollutants from power plants but was silent on whether that study should include the costs of regulation.
Michigan Solicitor General Aaron D. Lindstrom told the court that costs were a traditional part of such decisions.
In “the context of the question that the agency has to answer . . . costs are part of the relevant materials,” Lindstrom said.
But the liberal justices said that if Congress had meant for costs to be considered in the first part of the agency’s actions, it would have said so.
“My understanding of what EPA said is that it’s necessary because of public health harms and that it’s appropriate because there are technologies that can redress or remedy those public health harms,” Justice Elena Kagan said.
Justice Antonin Scalia interjected that it does not make sense for the EPA not to look at costs simply because a statute doesn’t require it. “I would think it’s classic arbitrary and capricious agency action for an agency to command something that is outrageously expensive and in which the expense vastly exceeds whatever public benefit can be achieved,” he said.
Before Lindstrom could respond, Justice Sonia Sotomayor did. Congress wanted a study of the health hazards presented, she said. “Why in the world would one assume that Congress was thinking about cost?” she asked.
Kennedy at times seemed sympathetic to the administration’s reading of the law. But when U.S. Solicitor General Donald B. Verrilli Jr. was at the microphone, he joined Chief Justice John G. Roberts Jr. in questioning the EPA’s actions.
“Could this agency reasonably have considered costs at stage one?” Kennedy asked.
Verrilli acknowledged that it could have but decided that that was not what Congress had intended.
Said Roberts: “Since you could have issued a regulation allowing the consideration of costs as appropriate, you’re saying that the agency deliberately tied its hands and said, ‘We’re not going to consider something. We’re going to issue a rule saying we can’t consider something that we could consider otherwise.’ ”
The costs and benefits are a matter of vigorous dispute. The states and industries opposing the regulations say that the annual costs of compliance under the rule would be $9.6 billion but that the benefits of reduced emissions of hazardous air pollutants are only $4 billion to $6 billion.
The EPA and environmental groups estimate the savings to be much more, from $37 billion up. Mercury can be especially dangerous to pregnant or breast-feeding mothers and young children, and some of the savings are calculated as coming from preventing as many as 11,000 deaths and more than a half-million lost days of work.
In addition, other environmental requirements mean that much of the capital expense of complying with the regulations has already been made, the government contends.
Sotomayor said that the court should follow its usual procedure and defer to the agency when a command from Congress is unclear.
“All we have to find is a plausible reading to uphold the EPA’s interpretation,” she said.
The combined cases are Michigan v. EPA; Utility Air Regulatory Group v. EPA; and National Mining Association v. EPA.
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Briefs Challenge EPA Emissions Plan For Power Plant Near Grand Canyon
Mar 26, 2015 | BNA Daily Environment Report
By William H. Carlile
The Environmental Protection Agency's choice for a source-specific federal implementation plan to reduce nitrogen oxide emissions from the Navajo Generating Station in northern Arizona “is not much of an option,” an environmental attorney who is contesting the action on behalf of three nongovernmental organizations told Bloomberg BNA March 25.
Earthjustice attorney Janette K. Brimmer, who is representing environmental petitioners in the case, told Bloomberg BNA the option does not comply with legal requirements for regional haze and best available retrofit technology (BART). Nor, she added, is it going to result in any significant pollutant reduction for years—at least a decade—to come.
Brimmer's statements came almost 10 days after the March 16 filing of opening briefs in the U.S. Court of Appeals for the Ninth Circuit (Yazzie v. EPA, 9th Cir., No. 14-73100, 3/16/15. The court last Oct. 7 received three separate petitions for review of the EPA plan (196 DEN A-18, 10/9/14).
The next step, according to Brimmer, is for the EPA to issue its response to the groups' points of contention, then petitioners will issue a final brief. All of that is scheduled to stretch into May, but may take longer, she said.
Plan Seeks to Cut Haze at Parks, in Wilderness
The EPA's plan sets a long-term cap on emissions from the facility as part of an effort to reduce regional haze at 11 national parks and wilderness areas.
But Brimmer labels the plan as unenforceable.
The plan, which was finalized in August, would require the plant to reduce its nitrogen oxide emissions by more than 80 percent, according to the EPA. The federal plan does not require the plant to install BART identified by the EPA, instead granting the facility flexibility that the agency said will result in greater emissions reductions at a lower cost (153 DEN A-4, 8/8/14).
It is that flexibility that has the groups concerned.
“We graphed where, because EPA played with the numbers and didn't do what it was supposed to do under its own regulations in the law, it's not even going to result in the same amount of pollutant reduction you would get if you actually followed the law and did what EPA first determined was proper, which is best available retrofit technology,” to reduce the haze pollution. Brimmer said.
The petitioners challenging the EPA's plan include the National Parks Conservation Association, the Sierra Club, the Natural Resources Defense Council and other environmental groups, tribal groups and an individual who lives near the power plant.
The plant, a 2,250-megawatt, coal-fired power facility, is located on a Navajo tribal reservation near Page, Ariz.
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Thune Amendment Targets EPA Ozone Standard
Mar 25, 2015 | E&E News PM
By Amanda Peterka
Sen. John Thune (R-S.D.) today offered an amendment to the Senate budget resolution aimed at U.S. EPA's efforts to tighten the national ozone standard.
The amendment would reduce the budget of the General Services Administration by $1 million a year until half of the counties currently out of compliance with the 1997 standard meet the limit. The money would be directed to EPA for purposes of helping areas achieve the 2008 standard.
The amendment comes as EPA is weighing whether to tighten the 2008 national ambient air quality standard for ozone from 75 parts per billion to between 65 and 70 ppb (Greenwire, Nov. 26, 2014).
Although it does not expressly prohibit a tighter ozone standard as EPA is considering, Thune's amendment says EPA should focus on the most polluted areas of the country that are out of compliance with the 2008 standard.
"Promulgating a lower standard at this time would impose undue costs on the economy and workforce of the United States," the amendment says.
Last week, Thune and Sen. Joe Manchin (D-W.Va.) introduced stand-alone legislation that would prohibit EPA from setting a more stringent standard until 85 percent of the country is in attainment with the 2008 standard. The "Clean Air, Strong Economies Act" would also require EPA to consider costs and feasibility when it sets a new ozone standard; the Clean Air Act says that EPA can consider only public health impacts when deciding where to set national ambient air quality standards (Greenwire, March 17).
"Lowering the ground-level ozone standard would be a staggering blow to our economy," Thune said in a statement last week. "The Obama EPA needs to focus its efforts on areas already struggling with attainment, not strangle American industry with a job-killing regulation."
Industry groups, which warn that a new standard would cost billions of dollars, have expressed support for the legislation. Public health groups and environmentalists, on the other hand, have blasted congressional efforts to bar EPA from setting a tighter standard.
It's unclear yet whether the budget amendment will get a vote during floor debate on the resolution this week.
Republican aides and lobbyists have been eyeing the multiyear transportation bill Congress hopes to pass this spring as a potential vehicle for an amendment to block the ozone rule, and a vote on Thune's amendment this week could provide an early measure of how many Democrats would be willing to sign on.
In a short interview this afternoon, Thune said there has been some discussion about adding ozone to the transportation bill but that no decisions had been made. He noted that the Senate Environment and Public Works Committee, which is responsible for drafting the highway provisions of the bill, has also expressed interest in taking that route.
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49 Senators Back Budget Amendment to Bring Down Carbon
Mar 26, 2015 | E&E Daily News
By Jean Chemnick
Nearly half the Senate voted last night for an amendment to the nonbinding fiscal 2016 budget resolution that calls on Congress to address carbon emissions.
The amendment by Sen. Bernie Sanders (I-Vt.) was defeated with a vote of 49-50. In language tailored to the underlying resolution, it calls for policies "protecting Americans from the impacts of human-induced climate change, which include action on policies that reduce emissions by the amounts that the scientific community says are needed to avert catastrophic climate change."
The measure was meant to come to the floor side-by-side with one by Sen. Roy Blunt (R-Mo.) that would have barred enactment of a federal carbon tax (Greenwire, March 24). But Blunt pulled his amendment at the last minute because it was ruled nongermane to the underlying budget resolution. Meanwhile, the measure has been redrafted and could receive a vote tonight.
Blunt said prior to the votes that his amendment made an important statement even though no legislation to price carbon emissions is expected to move anytime soon. He noted that the nation's largest grid operator, PJM Interconnection, has modeled pricing carbon through an interstate program as a means of complying with U.S. EPA's Clean Power Plan.
"I think the administration's trying to do a carbon tax by any other name, and if there's no carbon tax movement out there, it should be really easy for members of the Senate to vote not to allow one to go forward," he said.
But there is scant evidence of a "carbon tax movement," though a handful of conservative economists and think tanks have proposed a revenue-neutral model either as a substitute for EPA's existing power plant rule or to comply with it. Jerry Taylor, president of new libertarian think tank Niskanen Center, is the latest to propose that idea (ClimateWire, March 24).
And one of the few carbon price bills introduced in the last Congress was offered by Sanders, who quipped before the Blunt amendment was pulled that "I'm probably not going to vote for it."
He said before the votes that Republicans "continue to show themselves to be the anti-science party" when it comes to climate change. But five Republicans did cross the aisle to vote for Sanders' amendment: Sens. Kelly Ayotte of New Hampshire, Susan Collins of Maine, Lindsey Graham of South Carolina, Mark Kirk of Illinois and Rob Portman of Ohio.
Ayotte, Kirk and Portman are up for re-election next year in battleground states, while Collins and Graham have a history of backing carbon legislation. Kirk also backed a carbon dioxide cap-and-trade bill in 2009 while serving in the House, but has equivocated on that vote since.
The Illinois senator seemed to suggest in an interview with E&E Daily in January that man-made warming isn't real -- before retracting and backing amendments to legislation to approve the Keystone XL oil pipeline that affirmed warming, including a measure that highlighted the "significant" contribution human activity makes.
Portman appears to be walking a tightrope on climate change. While he backed the Sanders measure, he hopes to see the Senate vote on one of his own tonight that would endorse the federal government giving cover to states to adopt a "just say no" strategy for the Clean Power Plan.
The Portman measure was introduced on his behalf by Senate Majority Leader Mitch McConnell (R-Ky.), who has pressed states hard recently not to submit implementation plans on the rule. Portman's office stresses that he crafted the amendment language, and it was reintroduced yesterday with a change aimed at making it germane to the budget resolution.
"As always with the budget, this is a statement about a regulation that many of my colleagues think is the wrong approach for their states -- it certainly is for Ohio -- because it is resulting in deep concern along with other regulations for power plants, and then specifically for energy costs," he said last night.
Portman said he had taken a leadership role in this year's budget process because "I was asked to do it," but not necessarily because he is up for re-election. "I've been asked to do other things on the budget even before I was in this position," he said.
A director of the White House Office of Management and Budget under President George W. Bush, Portman said his GOP colleagues "like to put me out there," adding that his re-election race had nothing to do with his stance on amendments.
Democrats, meanwhile, have been reluctant to show their hand on this round of climate votes, which follows the three votes on climate science during the KXL debate that they say helped move the needle on the issue.
Sanders' staff on the Senate Budget Committee says that 500 amendments -- and counting -- have been filed, but it is unclear which will be selected for votes during tonight's "vote-a-rama" to stand "side by side" with amendments like Portman's. Fourteen of the amendments filed pertain to climate change.
Sen. Sheldon Whitehouse (D-R.I.) said on his way to votes that it did not matter if this round of amendments varied little from the ones offered in January.
"They've got no good place to go. They're somewhere between 'This is a hoax' and 'I'm not a scientist,'" he said. "It doesn't leave us having to be very specific or exacting about how we spotlight that failure."
Sanders himself took a dim view of what the amendment series could accomplish but said in an email following the vote: "We have a moral responsibility to respond to this crisis and we have to use every tool that we can in our arsenal."
Tonight could see votes on amendments to the wee hours of the morning, including several on climate change.
Meanwhile, the House passed its budget resolution last night, 228-199. Seventeen Republicans voted against it, along with every Democrat present.
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'Vote-A-Rama' Will Put GOP White House Hopefuls Back In Hot Seat On Climate
Mar 26, 2015 | E&E Daily News
By Daniel Bush
The Senate's Republican presidential hopefuls will face a new round of votes on climate policy when a marathon voting session on the budget kicks off today.
Democrats plan to offer a series of climate-related amendments to the Senate budget resolution in an effort to single out GOP senators -- including several White House contenders -- who have questioned the link between human activity and global warming.
The effort will put pressure on Republican Sens. Ted Cruz of Texas, Marco Rubio of Florida, Rand Paul of Kentucky and Lindsey Graham of South Carolina to cast politically risky votes on climate change ahead of the 2016 election.
Cruz announced that he's running for president earlier this week, becoming the first major candidate to officially jump into the race (Greenwire, March 23).
Rubio and Paul are expected to announce their White House bids in the coming weeks. Graham has expressed interest in running, as well, but has not indicated when he would make a final decision.
Democrats yesterday were still finalizing the details of their amendment strategy ahead of the lengthy voting process, known as the "vote-a-rama," which will start later today and might not end until well past midnight.
But Democrats behind the effort said it would be similar to the monthlong debate over the Keystone XL pipeline in January, when the Senate voted on a slew of climate change, energy and environmental amendments.
The latest suite of amendments will highlight "the difference between where Republicans in Congress are on climate change and where everybody else in America" stands on the issue, said Sen. Sheldon Whitehouse (D-R.I.).
Some Democrats have argued in recent days that there was little to gain in repeating the strategy so soon after the KXL debate.
"We are going to do everything we can to point out [that Republican lawmakers] who deny science are really extreme," Sen. Ben Cardin (D-Md.) said. "I'm not sure there's clear opportunities" to do that during the budget process, he added.
Still, today's votes will force senators to double down on positions that could be hard to defend to moderate and liberal voters in a general election. But a new Gallup poll released yesterday found that just 32 percent of American adults are worried about climate change (Greenwire, March 25).
During the KXL debate, Cruz, Paul and Rubio all rejected an amendment by Sen. Brian Schatz (D-Hawaii) that would have put the Senate on record as saying that climate change is real and significantly driven by human activity. Graham was one of five GOP senators who backed the measure.
Cruz also offered amendments to the Keystone XL bill that would have expedited liquefied natural gas exports, lifted the decades-old ban on crude oil exports and streamlined regulations for cross-border oil and natural gas pipelines.
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High Court Appears Split on EPA Decision Not to Consider Cost of Mercury Regulation
Mar 26, 2015 | BNA Daily Environment Report
By Patrick Ambrosio
Supreme Court justices appeared to have differing views on whether the Environmental Protection Agency adequately considered the costs of regulating emissions of mercury and other hazardous air pollutants from power plants (Michigan v. EPA, U.S., No. 14-46, argued 3/25/15).
The court heard oral arguments March 25 on whether the EPA unreasonably decided not to consider the cost of regulation when the agency determined it was “appropriate and necessary” to regulate those emissions, a finding that ultimately led to the promulgation of the 2012 mercury and air toxics standards (MATS).
State governments and industry groups that petitioned the court to review the finding argued that an arbitrary decision not to consider cost led to a regulation with disproportionately high annual compliance costs of $9.6 billion. The EPA argued that Section 112(n)(1)(A) of the Clean Air Act, which instructed the EPA to assess air toxics emissions from power plants and determine whether to regulate those emissions, does not explicitly require the agency to consider cost.
James Rubin, counsel in the global Energy, Transport and Infrastructure sector at Dentons US LLP, told Bloomberg BNA that it was “hard to read” what decision the court eventually will reach. Rubin said that while it is possible that a majority of the justices might support the EPA's argument that it deferred consideration of cost until the second step in the regulatory process, it is “equally likely” that the agency could lose a 5-4 decision.
Jeff Holmstead, a partner at Bracewell & Giuliani LLP and former EPA assistant administrator for air and radiation under President George W. Bush, agreed that it was tough to assess what the court may eventually decide after a review of the oral argument transcript. Holmstead told Bloomberg BNA that “more than any other recent EPA case,” it is difficult to predict the outcome of Michigan v. EPA. He noted that people had a “pretty good sense” of where the court was leaning after oral arguments in the last few EPA-related cases.
Holmstead said it appears that there are four justices troubled by the EPA's insistence that it didn't need to consider costs and three justices who are “very much inclined” to defer to the EPA's decision. Justice Anthony Kennedy appears to be the swing vote in the case, but a majority also could attempt to come up with a very narrowly tailored solution that Justice Stephen Breyer might sign onto, Holmstead said.
D.C. Circuit Decision Reviewed
The Supreme Court is reviewing a 2014 decision by the U.S. Court of Appeals for the District of Columbia Circuit, which upheld the MATS rule after concluding that the EPA's decision making was reasonable and the agency deserves deference (White Stallion Energy Ctr. LLC v. EPA, 748 F.3d 1222, 2014 BL 103957 (D.C. Cir. 2014)).
While the Supreme Court only agreed to review the narrow issue of whether the EPA unreasonably refused to consider cost in making the “appropriate and necessary” finding, attorneys familiar with the litigation told Bloomberg BNA that a broad decision against the EPA could have far-reaching effects on the agency's regulation of power plants and the deference the agency could expect to receive on the issue of whether a cost-benefit analysis is needed to promulgate environmental rules (56 DEN B-1, 3/24/15).
2001 Decision Called Analogous
Justice Elena Kagan appeared inclined to defer to the EPA's interpretation of the “appropriate and necessary” language, noting that Congress explicitly required cost consideration in other sections of the Clean Air Act.
“If Congress wanted to require something, and clearly, Congress required this in other places, Congress knows how to require consideration of costs,” Kagan said. “To get from silence to this notion of a requirement seems to be a pretty big jump.”
Kagan said the petitioners' argument that cost consideration is required despite statutory silence contradicts with the “most closely analogous” decision, a 2001 ruling that the EPA is prohibited from considering cost when setting national ambient air quality standards for ozone and other common air pollutants (Whitman v. Am. Trucking Ass'ns, 531 U.S. 457, 51 ERC 2089 (U.S. 2001)).
Justices Sonia Sotomayor and Ruth Bader Ginsburg also both appeared skeptical of petitioner arguments against the EPA. Sotomayor questioned what was irrational or not plausible about EPA's reading of Section 112(n)(1)(A). She noted that all the Supreme Court has to do is find that the EPA made a plausible interpretation of the statute to rule in the agency's favor.
Ginsburg said the word appropriately is commonly used to indicate that an expert agency will “do what it finds fit” based on its expertise, signaling that the agency may be due deference on its decision making. Ginsberg questioned whether the Supreme Court has ever held that the EPA is required to consider costs even though there was no instruction in the law to consider costs.
Michigan Solicitor General Aaron Lindstrom, who argued for the state petitioners, said the issue has never come to the Supreme Court in a case where Congress has given broad discretion to an agency, which in turn decided to ignore “an important part of the problem.”
Scalia Critical of EPA
Justice Antonin Scalia was critical of the EPA's decision to ignore cost. He described an “outrageously expensive” agency action where the cost vastly exceeds the benefit as a “classic arbitrary and capricious” act.
“I would think that's a violation of the Administrative Procedure Act, even without the word ‘appropriate',” Scalia said.
Late in the arguments, Scalia described the EPA's interpretation of the phrase “appropriate and necessary” as “a silly way to read” the statutory language.
Chief Justice John Roberts questioned why the EPA “deliberately tied its hands” by determining it would not consider cost, noting that it is “unusual” for an agency to voluntarily restrict its own authority.
“Agencies usually like to maintain for themselves as much discretion as they can,” Roberts said.
Rubin said that Roberts appeared to be more critical of the EPA than the petitioners, but said the chief justice “didn't telegraph” his view of the case through his questions.
Kennedy's Intentions Unclear
Kennedy, often described by observers as a swing vote in close decisions, had relatively few questions during oral arguments, but did question whether the EPA considered costs at all in its rulemaking process.
Solicitor General Donald Verrilli Jr., who argued on behalf of the EPA, said that the question before the court is whether EPA has to conduct a cost-benefit analysis when it decides to list power plants as a source of hazardous air pollutants that must be regulated. The logic of the statute is that the agency doesn't have to, Verrilli said.
Kennedy interrupted Verrilli, stating that once the EPA makes that listing decision, “at that point, the game is over.”
Later on, Kennedy indicated that the EPA didn't take the “second step” in the process to divide power plants into different categories, a step that an attorney arguing on behalf of power plants that support the MATS rule argued implicitly includes a cost consideration.
Paul Smith, chairman of the appellate and Supreme Court practice at Jenner & Block LLP, said that the EPA did subcategorize power plants in the MATS rulemaking, with oil-fired plants separated into four categories and coal-fired power plants also separated into different subcategories. Smith argued on behalf of Calpine Corp., Exelon Corp. and other industry respondents.
Hypothetical Scenario Discussed
Breyer seemed to be concerned that the decision to ignore cost at the listing phase could hypothetically lead to a regulation that the majority of the nation's power plants could not comply with.
Breyer was one of several justices that asked questions on the Clean Air Act requirement that the EPA must set standards for existing sources of hazardous air pollutants that require at least the level of performance already achieved by the average of the top-performing 12 percent of similar sources. Several justices, also including Breyer, Kennedy and Scalia, questioned whether the EPA had any ability to consider cost at that phase in the rulemaking process, given the minimum standards that must be set, commonly referred to as the “MACT floor.”
“Can the EPA take that into account, or do they have to just blindly say, if it's the top 12, that's for everybody no matter what the cost?” Breyer said. “In which case they can't take it into account ever except for the word ‘appropriate.' ”
Verrilli said the minimum MACT floor requirements depend on how the EPA categorizes an industry. In Breyer's hypothetical situation, the EPA would have the authority to establish separate source categories so power plants from vastly different segments of the industry were not placed together.
Record Questioned by Roberts
Roberts questioned where in the administrative record the EPA explicitly said the agency considered cost in dividing power plants into different subcategories, noting that “implicit usually doesn't work” for an administrative law issue.
“It's a very important principle of administrative law that we will only uphold a rule based on the arguments that were considered and addressed by the agency,” Roberts said.
Smith of Jenner & Block referred the court to the EPA's proposed rulemaking on MATS, which he said laid out the process for categorizing power plants in “exquisite detail.”
Sanjay Narayan, managing attorney with the Sierra Club, told Bloomberg BNA that there is “no question” that the subcategorization process includes a consideration of cost. The Sierra Club is one of several environmental and public health groups that filed a brief in support of the EPA.
Sean Donahue, an attorney representing the Environmental Defense Fund, told reporters during a March 25 media call that subcategorization is just one tool that the EPA used to address cost concerns. He said by the end of the argument, the court was “pretty clear” on how the EPA considered cost in the MATS rulemaking process.
Co-Benefits Criticized
William Brownell, a partner at Hunton & Williams LLP who argued on behalf of the Utility Air Regulatory Group, highlighted that in the EPA's cost-benefit analysis that was prepared alongside the MATS rule, only between $4 million to $6 million in benefits are associated with hazardous air pollutants. The rest of those benefits are co-benefits from the reduction of fine particulate matter and other pollutants, Brownell said.
Roberts questioned the legitimacy of counting benefits from reductions of pollutants that are regulated under other sections of the Clean Air Act, described the process as an “end-run” around the statutory language. He said it “raises the red flag” that a small percentage of the as much as $90 billion in estimated benefits that EPA attributed to the MATS rule.
Rubin of Dentons said a court decision on the use of co-benefits could have a significant effect on the EPA's ability to regulate because the EPA uses co-benefits in many of its regulations. He said the “toughest loss” for the EPA would be a decision that instructs the EPA to do a cost-benefit analysis on regulating power plant emissions, while also limiting how the EPA should do that analysis.
Holmstead said it is difficult to project if the court will address co-benefits because it will depend on how the majority opinion shapes up. A 6-3 decision against the EPA that included Breyer in the majority would likely be a more narrowly tailored opinion, but a 5-4 decision against the agency could be broader and address the co-benefits issue, Holmstead said.
The EPA raised the co-benefits issue in its brief to the Supreme Court, even though the court only granted review of the narrow question on the “appropriate and necessary finding,” Holmstead said.
“They kind of put that in play,” he said.
Decision Expected in June
Donahue and Richard Revesz, director of the Institute for Policy Integrity, both told reporters to expect a decision late in the Supreme Court's term. Revesz predicted that the court would not issue its decision until June.
As of March 25, the court had yet to issue a decision in a case that was argued in 2015. So far, all of the decisions this term have been in cases that were argued in October, November or December, according to a website that tracks decisions.
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High Court Appears Split Over EPA Air Quality Rule
Mar 25, 2015 | The Hill - E2 Wire
By Lydia Wheeler
The Supreme Court appeared split Wednesday over a challenge to the Environmental Protection Agency's first-ever limits on mercury, arsenic and acid gases emitted by power plants, slated to take effect next month for some plants.
The court is tasked with determining whether EPA unreasonably refused to consider costs in deciding whether it was appropriate to regulate hazardous air pollutants emitted by electric power plants under the Clean Air Act.
The D.C. Circuit Court of Appeals sided with EPA, but twenty-three states and more than two dozen industry and labor groups argue that the agency unreasonably refused to consider costs before imposing the mercury regulations on coal- and oil-fired electricity generating units.
Chief Justice John Roberts said compared to the cost, the benefit “raises a red flag.”
The EPA estimates the rule would cost $9.6 billion and produce between $37 billion and $90 billion in benefits, preventing up to 11,000 premature deaths annually.
But challengers say the benefits of controlling the utility emissions of mercury, which ends up in fish that’s eaten, only amount to $4 million to $6 million annually and that the rest of the benefits come from the reduction of particle pollution, which is regulated by other EPA mandates.
“The benefit from the mercury is what, $4 million?,” Roberts asked EPA’s attorney Donald Verrilli Jr.
“Well…” Verrilli said.
Though Roberts went on to say it’s a good EPA’s regulation has other benefits, such disproportionate figures create cause for concern.
“You begin to wonder whether it’s an illegitimate way of avoiding the quite different limitations on EPA that apply in the criteria program,” he said.
Verrilli said EPA only quantified one public health benefit for mercury, but there are other benefits that can be difficult and challenging to quantify.
During Wednesday’s arguments Justice Sonia Sotomayor acknowledged that the agency did not consider costs when listing electric generating units as a source of hazardous air pollution, but she said the rulemaking process does permit the agency to consider the cost of technology in creating subcategories for those units.
“They proposed categories, and everybody had the opportunity to say it's the wrong category, correct?” she asked Aaron Lindstrom, the attorney representing Michigan – one of the challenging states.
Justice Elena Kagan stressed that subcategories determine what the minimum and maximum standards will be and because those minimum and maximum standards can vary dramatically, she said, so can the compliance costs.
Lindstrom argued that the EPA made those categorizations without considering costs.
“All right. Then how would you do that without considering cost?” Justice Stephen Breyer asked.
“I don't know how they did it, but they've said throughout that we’re not considering costs,” Lindstrom said.
Sotomayor said the agency has consistently said it doesn’t consider cost at the listing stage, because it considers it later on in the rulemaking process.
“The issue is do you have to do it at the listing stage,” she said.
“That’s exactly right,” Verrilli said. “The question here is whether EPA's got to conduct a cost-benefit analysis when it does the listing,”
But Justice Anthony Kennedy, a potential swing vote in the case, seemed skeptical of the EPA's rule, questioning whether merely listing the plant indicates standards will be set, regardless of whether the EPA examined the costs at a later time.
Hence, he suggested, the determination had already been made that the plants would be regulated, even before the EPA considered costs.
“At that point the game is over,” Kennedy said.
“No,” Verrilli said. “I don’t think it is.”
But the rule's challengers also faced tough questions from the justices. Under questioning from conservative Justice Samuel Alito, Paul Smith, an attorney representing the industry challengers, said he didn’t know what the criteria for the subcategories are.
“How can you tell if cost has been taken into account at all when you don’t know the criteria for how the subcategories are created?” Alito demanded.
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Supreme Court Appears Divided on EPA Rules to Limit Mercury Emissions
Mar 25, 2015 | The Wall Street Journal
By Brent Kendall
The Supreme Court appeared split on Wednesday over whether the Environmental Protection Agency erred when it adopted first-ever regulations requiring power plants to cut emissions of mercury and other toxic air pollutants.The regulations would cost $9.6 billion in annual costs, according to EPA estimates. But the agency said it was appropriate to consider only public health risks—not industry costs—when it decided to regulate coal- and oil-fired generation plants. That decision was the crux of 90 minutes of oral argument.
The court was considering a section of the Clean Air Act that said the EPA “shall” regulate utilities’ emissions of the hazardous air pollutants if it found that such regulation “is appropriate and necessary.” The agency said it took costs into account later when it determined exactly how to set emissions standards.
Members of the Supreme Court’s conservative majority repeatedly questioned the government’s position, while liberal justices largely voiced support for EPA’s approach.
Conservative Justice Antonin Scalia said it was a “classic” violation “for an agency to command something that is outrageously expensive and in which the expense vastly exceeds whatever public benefit can be achieved.”
Liberal Justice Ruth Bader Ginsburg said Congress instructed the EPA to use its expertise to decide if regulation was appropriate. “Is there any case in all of our decisions where we have said even though there was no instruction to consider costs, EPA is required to consider costs?” she asked.
The rules, adopted in 2012 and set to go into effect next month, are a key part of the Obama administration’s environmental agenda. They require plants to install high-tech scrubbers to remove the pollutants. Many companies have already moved to install the controls.
The EPA said such plants are the single largest source of U.S. emissions of mercury, a neurotoxin that can be particularly harmful to children and unborn babies.
U.S. Solicitor General Donald Verrilli, defending the agency, said it was “certainly appropriate for EPA to list power plants for regulation based solely on health and environmental hazards.” That was the usual approach under the Clean Air Act, and if Congress wanted EPA to deviate from the norm, it would have said so, Mr. Verrilli said.
The solicitor general conceded the $9.6 billion in costs was “a big number,” but said the industry generated $360 billion in annual revenues. He also referenced EPA findings that the actual benefits of the regulations would be at least $37 billion.
Chief Justice John Roberts said those estimates raised red flags because only a “tiny proportion” of the calculated benefits were attributable to mercury reductions. Instead, the EPA required pollution controls that would filter out other types of pollutants not directly covered by the regulations. “I’m just questioning the legitimacy” of that approach, he said.
Michigan Solicitor General Aaron Lindstrom, representing the states, said that when Congress told EPA to decide if regulation was appropriate, that meant the agency was supposed to consider costs. “They’ve ignored an important part of the regulatory problem,” he said.
The case could come down to moderate conservative Justice Anthony Kennedy, often the court’s swing vote in cases where justices are ideologically divided.
Justice Kennedy suggested Congress gave the EPA latitude, but he also questioned the EPA’s decision to wait and consider costs in later stages when it was setting the exact standards in the regulations. “At that point the game is over,” he said.
Justice Stephen Breyer, one of court’s liberal justices, also asked probing questions of both sides. At times he expressed sympathy for the EPA but also said the regulatory costs of the mercury regulations, divided by the U.S. population, came out to about $30 a person. “That’s a lot of money for some people,” he said.
A ruling is expected by July.
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House Panel Approves Bill Giving States More Flexibility in Regulating Coal Ash
Mar 26, 2015 | BNA Daily Environment Report
By Dean Scott
A House Energy and Commerce panel March 25 approved a bill that would give states flexibility in regulating coal ash and would permanently bar the Environmental Protection Agency from regulating the material as hazardous waste.
The Subcommittee on Environment and the Economy approved the Improving Coal Combustion Residuals Regulation Act by a vote of 16-5. The panel defeated two Democratic amendments designed to strengthen environmental protections in the bill, authored by Rep. David McKinley (R-W.Va.).
The bill is still in draft form and has not been introduced. It would next be considered by the full House Energy and Commerce Committee for its consideration.
Democrats offered two amendments at the subcommittee markup that they said were needed to strengthen the bill, the first authored by the ranking Democrat on the House energy panel, Rep. Frank Pallone Jr. (D-N.J.). It was defeated by a vote of 6-12.
A second amendment, by Rep. Lois Capps (D-Calif.), would have directed the EPA to ensure that coal ash storage structure meet “requirements as necessary” to protect human health and the environment. It fell by a vote of 8-12.
If signed into law, the bill would essentially trump federal standards finalized by EPA in December and give states more regulatory and enforcement flexibility in addressing environmental concerns posed by coal ash disposal. The measure has strong support from utilities and coal ash recyclers.
EPA Designed Material Nonhazardous
The final EPA requirements have not been formally published in the Federal Register. But its final standards would classify the material as nonhazardous waste under Subtitle D of the Resource Conservation and Recovery Act. Utilities and coal recyclers say a legislative prohibition is necessary because there is nothing in the agency rule that would prevent the EPA from regulating the material as hazardous waste in the future.
The bill's supporters argue that the bill is just as protective as EPA's requirements. But environmental groups say the legislation would eliminate the public's access to information on contaminated sites and weaken and eliminate a requirement that states require cleanup of all hazardous releases.
EPA's assistant administrator for solid waste and emergency response, Mathy Stanislaus, stopped well short of endorsing the House bill at a subcommittee hearing on the measure March 24.
He said McKinley's measure still lacks “additional essential elements of transparency, prevention and response” that are key components in EPA's regulations (57 DEN A-19, 3/25/15).
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House Panel Passes GOP Coal Ash Bill
Mar 25, 2015 | The Hill - E2 Wire
By Timothy Cama
A subpanel of the House Energy and Commerce Committee passed a Republican-backed bill aimed at adding certainty to the Environmental Protection Agency’s (EPA) coal ash disposal rule.
The bill, sponsored by Rep. David McKinley (R-W.Va.), passed 16 to 5 Wednesday, with three Democrats joining all the Republicans to vote for it.
McKinley’s bill answers a number of concerns Republicans and utilities had with the EPA’s December rule, which set the first national standards for storage and disposal of coal ash waste at power plants and in landfills.
The House bill improves enforcement mechanisms by requiring states to set up permit systems for coal ash sites, while removing some of the requirements of the EPA rule, like public disclosure of the status of disposal ponds and pits.
Rep. John Shimkus (R-Ill.), the chairman of the environment subcommittee, said the bill addresses industry concerns while preserving the important protections of the EPA rule.
“The bill requires every state have a permit program and every permit program will contain
minimum requirements based on EPA’s final rule,” Shimkus said before the vote.
“This is a good bill. EPA developed technical requirements for coal ash that are protective of
human health and the environment,” he said. “This bill utilizes those requirements and makes them part of enforceable permits.”
But Democrats argued that the bill is unnecessary, and would push back deadlines while weakening the rule.
Rep. Paul Tonko (D-N.Y.), the subcommittee’s top Democrat, urged his colleagues to wait to see how the EPA’s rule is enforced.
“Ultimately, the only real test of whether this rule takes the correct approach or not is by implementing it,” he said.
“The bill before us claims to mimic the protections by the EPA’s final rule. But that claim is in serious doubt,” Tonko continued. “The claims made about the rule that it may lead to dual enforcement or excessive lawsuits may prove to be true or prove to be not true.”
The subcommittee voted down a pair of Democratic amendments aimed at strengthening the bill’s requirements for utilities.
Mathy Stanislaus, the EPA’s assistant administrator for solid waste, testified before the panel Tuesday. He defended the agency’s rule, though he declined to take a position on the legislation.
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EPA's Call For Revisions To House Coal Ash Bill Prompts GOP Opposition
Mar 25, 2015 | InsideEPA
By David LaRoss
EPA's top waste official is calling on House Republicans to revise their draft bill to overhaul parts of the agency's coal ash disposal rule by adopting a “clear” minimum disposal safety standard and other changes, but GOP lawmakers' opposition to such revisions could hinder their ability to win the administration’s support for the bill.
Speaking at a March 24 House Energy & Commerce subcommittee hearing on the measure, EPA waste chief Mathy Stanislaus said the agency does not oppose in principle the pending legislation on coal combustion residual (CCR) disposal. But in his testimony he urged the panel to incorporate more provisions from EPA's 2014 rule into the bill, including a “clear” minimum standard of protectiveness for state regulatory programs.
The draft House bill would codify much of EPA's final CCR disposal rule issued last year but make some significant changes including giving states primary authority to craft and implement coal waste disposal programs, rather than EPA's approach setting nationwide standards enforced through citizen suits. The panel held the March 24 hearing to hear input from Stanislaus on the measure ahead of a March 25 markup where a majority approved the bill.
Lawmakers in the 113th Congress tried unsuccessfully to move coal ash legislation ahead of EPA finalizing its rule, and President Obama never threatened a veto, instead offering suggestions for changes to that bill that could win the administration's support. EPA is now pitching changes to the new bill to win the administration’s backing.
“We appreciate the provisions of the discussion draft that incorporate some of the components of the EPA’s CCR rule. However, some additional essential elements of transparency, prevention and response that are included in the EPA’s rule are critical for establishing a framework to help ensure the proper management of CCR disposal,” Stanislaus told members of the energy panel's Energy and Environment Subcommittee at the March 24 hearing.
In response to a question from Rep. Gregg Harper (R-MS), Stanislaus said the bill should explicitly state minimum standards of protection that state programs must meet in crafting coal ash disposal programs, because “we believe that level of specificity is necessary to achieve” protective regulations.
But the GOP majority on the panel voted against adding such a standard during the March 25 subcommittee markup, voting 12-8 along party lines against an amendment from Rep. Lois Capps (D-CA) that would have required state coal ash programs to be “protective of human health and the environment.”
Speaking against the amendment, Rep. David McKinley (R-WV), the bill's author, called it “an attempt to set up a subjective yardstick” rather than objective criteria for state disposal rules.
Stanislaus also called on the committee to adopt EPA's regulatory language requiring facilities to disclose water quality and other monitoring data directly to the public -- rather than giving that responsibility to state regulators -- and to strengthen cleanup mandates for ash leaks, rules for facility closure and criteria for structural integrity.
But supporters of the bill voted down by 12-6 an amendment from full energy panel ranking member Rep. Frank Pallone (D-NJ) that would have required states to duplicate all substantive requirements of the EPA disposal rule in their regulatory programs. The amendment would have struck bill provisions that would allow states to revise some specifications where reasonable.
Energy subcommittee chair Rep. John Shimkus (R-IL) said those provisions are necessary for “the authority of the implementing agency to modify, in certain circumstances, site-specific factors.”
'Frustrating' Statements
Speaking to reporters after the March 24 hearing, Shimkus called Stanislaus' statements “frustrating. . . we really think we're helping them do what they want to do. It's the most bizarre thing I've seen,” he said.
The only Democrat attending the March 24 hearing, subcommittee ranking member Rep. Paul Tonko (NY), opposed the bill outright rather than calling for revisions, arguing that Congress should let EPA's CCR rule take effect and only act if it turns out to be ineffective. “I do not see a need for legislation at this time,” he said.
The divisions among Democrats, Republicans and the administration over the text of the legislation could hinder the GOP's attempt to win Obama's backing for the pending coal ash measure.
The draft bill -- which passed out of the subcommittee markup on a 16-5 vote but as of press time had not been formally proposed -- aims to replace EPA's final rule governing disposal of coal ash with a regime administered by states, but would apply many of the same technical requirements as the agency's regulation.
It would also underscore EPA's decision to regulate ash as a Resource Conservation & Recovery Act (RCRA) subtitle D solid waste by barring any future regulation of ash as a subtitle C hazardous waste.
But Democrats and environmentalists at previous hearings have charged that the bill would substantially weaken the EPA rule -- in part because, they say, the bill lacks a minimum standard of protection that state regulations would be required to meet.
Supporters of the legislation have countered that it would effectively set such a standard even if it does not use the advocates' preferred language.
Stanislaus' statements on minimum protection standards echo a 2013 White House statement of administration policy, responding to the earlier House coal ash bill that cleared the lower chamber but failed to advance in the Senate during the 113th Congress.
In that statement, the Obama administration stopped short of threatening a veto but said legislators should add “clear minimum standards for EPA to identify and remedy State program deficiencies.”
The 2013 statement also called for regulation of “legacy sites” that no longer receive ash -- which the current draft bill would address -- as well as strict groundwater protection standards and a “clear and appropriate authority for taking potential corrective action” against leaking impoundments.
EPA signed its ash disposal rule in December but has yet to publish the regulation in the Federal Register, a necessary step for the rule to take effect. Stanislaus said at the hearing that EPA has sent the rule for publication and expects it to appear in the Register “soon.”
State and industry concerns over EPA's rule have mainly focused on enforcement. Prior to the rule's finalization, they had urged the agency to apply a regime where states would have primary authority to craft and implement RCRA subtitle D coal ash standards subject to federal review and approval of their policies.
EPA instead opted for a system of national standards enforced through citizen suits in federal courts. Critics of the rule have argued that the agency's plan will lead to conflicting or redundant federal and state requirements.
States' Support
While environmentalists and Democrats have opposed the bill, state regulators at a March 18 subcommittee hearing backed it. Both Pennsylvania waste management head Michael Forbeck, president of the Association of State and Territorial Solid Waste Management Officials, and Virginia Department of Environmental Quality head David Paylor, who spoke on behalf of the Environmental Council of the States, said the bill would improve on EPA's rule. "The draft bill has successfully captured the essential parts of the EPA rule on [coal ash] management that are germane to the protection of the environment and public health, and has modified or added those areas that improve upon the rule," Forbeck said in his testimony. -
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Kennedy Seen As High Court Swing Vote In Suit Over EPA's Utility MACT
Mar 25, 2015 | InsideEPA
By Stuart Parker
Supreme Court Justice Anthony Kennedy appears to be the swing vote that will determine whether the high court sides with industry and 21 states in finding that EPA erred by not considering costs when deciding to craft an air toxics rule for utilities, with Kennedy raising doubts over both the plaintiffs' and government's arguments.
EPA has said the Clean Air Act is ambiguous on whether the agency must consider costs when deciding to regulate an industrial source category with an air toxics standard, and Kennedy at first hinted at deferring to EPA's interpretation by noting the “capacious” language at issue -- only to ask the administration tough questions later.
At the arguments in the consolidated suits over the power plant maximum achievable control technology (MACT) emissions standards, other justices' statements signaled more clearly whether they would back EPA's claims or agree with the rule's critics. Justices Sonia Sotomayor, Elena Kagan, Ruth Bader Ginsberg and Stephen Breyer made statements that suggested they might side with EPA, while Chief Justice John Roberts and Justices Antonin Scalia and Samuel Alito had harsh questions for the agency. Justice Clarence Thomas asked no questions.
If the justices vote in line with their questioning at arguments, that would result in a 4-4 tie with Kennedy casting the decisive vote. But although environmentalists on a March 25 post-arguments call expressed optimism that the court would back EPA, Kennedy's comments at arguments suggest he might still rule either way.
“In the end, then, it seemed that Kennedy's vote perhaps might still be in play, as the Court in coming weeks worked toward a decision,” said Lyle Denniston in a March 25 post on SCOTUSblog.
The court agreed to hear the cases -- National Mining Association (NMA) v. EPA, et al., Utility Air Regulatory Group (UARG) v. EPA, et al. and State of Michigan, et al. v. EPA, et al. -- on the sole question of whether the air law requires that EPA consider costs when deciding that a MACT is “appropriate and necessary” for a sector.
The law is not explicit on that issue, and EPA in briefing said it did not consider costs when deciding to subject power plants to a MACT because it based that determination on the need to cut mercury and other toxic emissions from the energy sector in order to protect public health. However, the agency did consider costs when developing the actual standards and found the $37-90 billion benefits would far outweigh the $9.6 billion costs.
Power plants are regulated under a separate air law provision than other sources of air toxics, which could limit the impact of an adverse ruling for EPA. Some observers believe the conservative justices agreed to hear the case simply because of the huge costs and benefits involved in the MACT. Critics discount all but $6 million of the claimed benefits, which they say makes the rule's costs massively out of proportion to its benefits.
A coalition of 21 states, UARG, NMA and others have argued that it makes no sense for EPA to not consider costs as part of the decision on whether an air toxics rule is appropriate and necessary. They say that the agency's cost-benefit analysis when setting the actual emissions limits in the rule came too late in the process.
EPA, environmentalists, other states and public health advocates have countered that the statute's silence on the issue means the agency's interpretation is correct -- that it must first decide whether there is a health and environmental need for a MACT, and then consider costs once it has decided to craft a rule. Even if the court remands or vacates the MACT for a lack of cost considerations, observers have suggested EPA could use the existing cost-benefit review it developed in setting the standards to satisfy the cost review for a new appropriate and necessary finding.
A 2-1 majority of the U.S. Court of Appeals for the District of Columbia Circuit in its April ruling in White Stallion Energy Center v. EPA, et al. backed EPA's claims, but Judge Brett Kavanaugh dissented, saying that costs should have been a central consideration in the agency's initial decision to develop a MACT.
Justices' Questions
At arguments, Kennedy's initial comments seemed to boost the administration, as he said “'appropriate' is a capacious term,” referencing the air law's appropriate and necessary language.
Responding to Kennedy's observation, Michigan Solicitor General Aaron Lindstrom, representing the states opposed to the rule, said that although “appropriate” is a capacious term, EPA effectively ignored it entirely. Instead, he argued that the agency predetermined that it “must find it appropriate” to regulate with a MACT if a health risk from power plant toxics emissions remains, rendering the term “appropriate” redundant.
Sotomayor noted, however, that EPA under the air law had to issue its determination of what is “appropriate and necessary” based on the results of a health study that was focused exclusively on the remaining risks posed by power plant air toxics after other regulatory programs -- chiefly EPA's acid rain program -- had been applied.
Kagan suggested that the “appropriate” qualifier refers to the existence of control technologies that could reduce toxic pollution -- which were available at the time EPA made its determination.
The justice also suggested that “appropriate and necessary” can be read as a single phrase and under legal precedent need not be parsed into two separate requirements for what EPA must consider.
Sotomayor said, “I had a different understanding of appropriate and necessary. Appropriate if there were [hazardous air pollutants, or HAPs], but necessary only if those HAPs were not sufficiently controlled by the other technology.” This interpretation also appears to favor the government's position.
Justice Ruth Bader Ginsberg said, “the word 'appropriate,' I think, is commonly used to indicate that the expert agency will do what it finds fit based on its expertise.”
She then asked Lindstrom, “Is there any case in all of our decisions where we have said even though there was no instruction to consider costs, EPA is required to consider costs?”
Lindstrom conceded that there was not any such case.
In previous rulings on cost issues under the Clean Air Act, the Supreme Court has either ruled that EPA has discretion on the issue, or in its 2001 ruling on ozone standards in Whitman v. American Trucking Associations, actually found EPA was prohibited from considering costs in setting air quality standards. Most recently, the court held that EPA had discretion to consider costs in its April ruling upholding key principles of EPA's Cross-State Air Pollution Rule emissions trading program in EME Homer City Generation, LP. v. EPA.
Scalia -- the author of the Whitman opinion -- said at arguments that the air law did not require EPA to consider “only” the results of the health study when making its utility MACT finding. He criticized EPA's failure to consider costs in the power plant listing decision, finding EPA's interpretation of “appropriate” as not requiring this “silly.”
Alito, meanwhile, targeted Congress' treatment of power plants in a different way to other sources of air toxics. He said, “Congress's decision to treat power plants differently, it seems to me, reflects the fact that Congress wanted at least to hold open the possibility that power plants would not be listed even if their emissions exceeded the levels that would result in listing for other sources. I don't see another reason why they would treat them differently.”
Alito then continued, “what factor might Congress have thought would justify allowing power plants to emit more than would be permitted if they were other sources? Now, Petitioners have an explanation which is costs, and they say that power plants have to bear a lot of costs that other sources don't have to bear, in particular the [acid rain] program.”
Alito added, “Cost is what's missing. I don't know what your explanation is.”
Cost Considerations
Justice Department Solicitor General Donald Verrilli in his defense of EPA said the structure of other air law toxics provisions supports EPA's claim that the law requires a distinct two-step process, with costs only a consideration in standard-setting, the second phase. Other air law provisions are structured this way, he argued, questioning why EPA would depart from this structure without clear Congressional direction to do so. If “Congress intended to mandate that EPA cut so deeply against the grain and make such a radically different approach with respect to this one category of sources, you would expect to see very clear legislative language to that effect,” he said.
Verrilli countered Alito's points by arguing that, “the argument that Your Honor just posed is not in the legislative history, and it's not in the text. And if Congress really thought that, then what they would have said to EPA is, take the -- push the pause button, take the three years and study -- don't subject them to the same schedule as everybody else -- and study the cost problem. They would have expressly told EPA to study costs. And they did not do that.”
Kennedy echoed a question posed by Roberts: “Could this agency reasonably have considered costs at stage one?” referring to the initial appropriate and necessary review.
Verrilli replied that, “I don't think the statutory text unambiguously forbids them from considering costs,” but that EPA reasonably concluded that its reading of the statute prohibiting costs at the outset was the best, and consistent with the approach taken by other air law provisions.
Attorney William Brownell, representing UARG in opposition to the rule, pressed industry's argument that in fact, the “appropriate and necessary” criteria apply to air toxics regulation of power plants in general, not merely the initial listing decision. UARG rejects the two-step distinction drawn by EPA on this issue.
Kennedy asked Brownell “do you think that whenever the term 'appropriate' is used in a regulatory context in the Clean Air Act, that it demands a cost-benefit analysis?”
Brownell replied, “That's so broad I don't think that I can say that it would require cost-benefit in any context,” but suggested the particular context of the appropriate and necessary finding supports such a demand.
Verrilli also said that EPA does not have to consider costs in the listing decision, but Kennedy interjected that, “But at that point, the game is over,” suggesting doubts over the timing of when EPA considers costs. Verrilli countered that, “I don't think it is,” because the MACT-setting process takes costs into account when setting the actual emissions limits.
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Natural Gas Transport Safety on DOT Radar, As Congress, Agencies Address Crude-by-Rail
Mar 26, 2015 | BNA Daily Environment Report
By Rachel Leven
The Transportation Department is adding another energy transport safety issue to the administration's agenda: natural gas.
While the administration and Congress are still busy addressing the transport of crude oil by rail, a senior department official told a House Appropriations subcommittee March 25 that reduced flaring in crude oil production, potential exporting of liquefied natural gas and efforts to use LNG as a fuel are expected to increase transport of this product domestically. Similar to crude oil, lack of pipeline capacity where it's needed could push some natural gas onto rail, the official said.
“Obviously, the price of gas drives a lot of this,” Timothy Butters, acting administrator for the Pipeline and Hazardous Materials Safety Administration, said at the House Appropriations Subcommittee on Transportation, Housing and Urban Development, and Related Agencies hearing. “But again, as a safety agency, our goal is to be ready.”
The Transportation Department has been working with agencies across the administration to address safety issues associated with transporting crude oil by rail, an issue that has garnered significant public scrutiny as oil production has increased, more oil has been transported by rail and more derailments have occurred. These derailments have caused environmental and property damage and the most widely-known incident in Lac Megantic, Quebec caused 47 deaths.
Natural Gas
Natural gas is a by-product of crude oil production, an area where there has been increasing development and where there will likely be a need for the product to be “stored and transported,” Butters said.
Requests by several liquefied natural gas (LNG) facilities to export this product also signal there will be more movement of natural gas and there are efforts to use LNG as a fuel for railroads, maritime vessels and other power units, Butters said.
Limited pipeline capacity may push natural gas to be transported by rail or other modes, Butters said. Sarah Feinberg, acting administrator for the Federal Railroad Administration, said three companies have approached her agency about transporting LNG by rail so far.
“We'll see a dramatic increase of movement of this product as a commodity,” Butters said. “We need to ensure that containers that can move that product are properly and safely designed.”
Gathering Lines
Production and gathering facilities will be a key challenge for PHMSA in addressing this expected natural gas transport increase, Butters said.
Gathering systems generally are pipelines that run from the natural gas well or field to a processing plant or transmission grid, according to the Energy Information Administration. These gathering and production facilities are not federally regulated and many states don't regulate them either, Butters said.
“Some of these pipelines are pretty significant,” Butters said. “The pressures, the compressor stations, the length of pipe and their location—they're moving through some populated areas, which has our concern.”
PHMSA is seeking the authority to “make sure that those are done safely and encouraging the states to pick up that responsibility,” Butters said. Butters also requested research and development resources.
Crude-by-Rail
Meanwhile, members of Congress questioned Transportation Department officials on details regarding President Barack Obama's budget request.
The most notable provisions discussed at the hearing were the president's request for $5 million for a Safe Energy Transport Program to be housed within the Transportation Department's Office of the Secretary and an institute for short line railroads, provisions nearly 60 Democrats recently requested the appropriations committee support (57 DEN A-6, 3/25/15).
Rep. Evan Jenkins (R-W.Va.) highlighted that at least one recent derailment of a train carrying crude oil in Mt. Carbon, W.Va. had used the new model of tank cars—the CPC 1232. These tank cars could have been acceptable under one option of the PHMSA proposal that would govern tank car design and operational controls for certain flammable liquids transport, he said (37 DEN A-3, 2/25/15).
“From my perspective, we may be rubber stamping a car standard that isn't good enough,” Jenkins said.
Feinberg didn't say whether the administration was reevaluating its decisions on the rule, which FRA worked on, too, based on the recent accidents. However, she said that there is “an acknowledgement across the administration that the derailments that we've seen in recent weeks have all been ... 1232 cars” and that the administration is “very confident” that the rule is a step in the “right direction.”
The final PHMSA rule is under review at the White House and is expected to be released in May (52 DEN A-12, 3/18/15).
Amendment, Bill
In other areas of the appropriations process, Sen. Heidi Heitkamp (D-N.D.) introduced an amendment to S. Con. Res. 11 that would recommend funding her bill (S. 546), which addresses emergency response to crude-by-rail incidents (43 DEN A-23, 3/5/15).
Outside of the appropriations process, four senators introduced a bill March 25 to improve the safety of crude-by-rail transport through a comprehensive approach, including addressing response efforts.
Notably, the Crude-by-Rail Safety Act of 2015 (bill number unavailable) would require phasing out use of older DOT-111 tank cars and unjacketed CPC-1232 tank cars.
It also would require PHMSA to promulgate requirements for volatility of gases in crude oil moved by rail and require that PHMSA's upcoming final rule implement certain stringent tank car design standards, among other steps.
“Every new derailment increases the urgency with which we need to act,” said Sen. Maria Cantwell (D-Wash.), ranking member on the Senate Energy and Natural Resources Committee and a bill sponsor. “This legislation will help reduce the risk of explosion in accidents, take unsafe tank cars off the tracks and ensure first responders have the equipment they need.”
Other bill sponsors include Sens. Patty Murray (D-Wash.), Tammy Baldwin (D-Wis.) and Dianne Feinstein (D-Calif.).
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Railroad Agency, Energy Groups in Spat Over Crude-by-Rail Safety Involvement
Mar 26, 2015 | BNA Daily Environment Report
By Rachel Leven
The Federal Railroad Administration is engaged in a public spat with the energy industry regarding the degree to which different groups are responsible for addressing crude-by-rail safety.
The disagreement centers on how involved the rail and energy industries have been in making the transport of crude oil by railroad safer and who should be responsible for steps in the future. While the rail agency's top official claims the energy industry has tried to “not be involved” in resolving this safety issue, two energy groups highlighted their actions.
“Both [the American Fuel & Petrochemical Manufacturers] and the [American Petroleum Institute] have put out statements or press releases in the last few days continuing this effort to not be involved in the safe transport of this product and so this [the agency's statements] is an effort by FRA to just try to bring additional industries into this issue,” Sarah Feinberg, acting administrator of the Federal Railroad Administration, told Bloomberg BNA March 25.
“This is a problem that we're only going to solve if all of the industries come in and work together,” Feinberg said.
Increased domestic production of crude oil and transportation of oil by rail has resulted in more frequent derailments of those trains, including several incidents in 2015 that caused environmental and property damage. The Obama administration is addressing this issue through rulemakings, emergency orders, voluntary measures and other steps to improve prevention, mitigation and response to these incidents.
The Disagreement
The disagreement began with comments by Feinberg at a pen-and-pad session with reporters March 13.
The comments, reported by POLITICO, call on the energy industry to do more when it comes to crude-by-rail and says the railroads have gone “above and beyond.” Feinberg said she will always ask the railroads “to do more,” but “there have to be other industries that have skin in the game.”
“We are running out of things that I think we can ask the railroads to do,” Feinberg said, according to POLITICO's report.
Both AFPM and API, two major energy groups, have cited these comments in news releases and letters. In a March 16 letter to Transportation Secretary Anthony Foxx, AFPM President Charles Drevna said Feinberg's comments “show a fundamental misunderstanding of the root cause of rail accidents” and requested clarification from DOT.
“Does DOT believe that the current frequency of derailments is acceptable and that there is nothing further that FRA and the railroads can do to address track integrity, which is the leading cause of crude-by-rail as well as other incidents? Do you disagree that additional track inspections and more robust track maintenance requirements would significantly enhance safety?” Drevna wrote.
Meanwhile, Robin Rorick, API's director of midstream and industry operations, said in a March 24 statement regarding a recent Energy Department report: “This report raises puzzling questions about Acting Federal Railroad Administrator Sarah Feinberg's suggestion that nothing more can be done to prevent derailments. We can and must do more to prevent derailments as part of a comprehensive approach to safety” (57 DEN A-13, 3/25/15).
Federal Railroad Administration Responds
Late on March 24, the railroad agency issued a reply to API's news release. Suzanne Emmerling, a spokeswoman for the agency, said “it's disappointing that API continues to look for reasons not to engage in improving safety” and reiterated that the agency will always demand more from railroads.
Feinberg told Bloomberg BNA March 25 that these industry statements are the energy groups' latest attempts to show that they are “entitled” to take a step back on this issue. The energy industry has for a long time held that crude-by-rail is a railroad issue and “not something that they have to work with us on to solve,” Feinberg said.
However, Jack Gerard, president of API, told reporters on a call announcing an API and Association of American Railroads new crude-by-rail safety course for first responders that “any suggestion that we're not engaged is just inconsistent with the facts.” The energy industry has taken a number of steps such as purchasing enhanced tank cars voluntarily.
“The industry is not only engaged … but we're leading the way and we fully expect to continue leading the way,” Gerard said on the March 25 call. According to API, course offerings are confirmed or being planned in more than 15 states.
Gerard emphasized the need for a comprehensive approach—taking preventative, mitigation and response measures— to fully reduce risk associated with this transport. He also noted his group's collaboration with regulators, including a meeting at the White House March 24 on the upcoming Pipeline and Hazardous Materials Safety Administration rule governing aspects of crude oil and certain other flammable liquid transport by rail.
Resolution Possible
The spat could be short-lived. Both Feinberg and Gerard noted to Bloomberg BNA a willingness to meet. Gerard called FRA a “partner” and said these comments were not a sparring match.
Feinberg told Bloomberg BNA: “FRA's doors are always open, DOT's doors are always open.”
“Nothing good will come out of some industries taking a step back and saying, ‘I don't want to be part of any solution',” Feinberg said.
API didn't respond to a message from Bloomberg BNA requesting more details on the March 24 White House meeting. AFPM didn't immediately respond to Bloomberg BNA's messages requesting comments.
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Panel Approves Bills to Revamp Board, Extend Deadline for Safety Work
Mar 26, 2015 | E&E Daily News
By Sean Reilly
Bills to revamp the Surface Transportation Board and give railroads five more years to complete work on costly new safety systems easily cleared the Senate Commerce, Science and Transportation Committee on voice votes yesterday.
But in a sign of possible trouble ahead, three committee members voted against the latter bill, S. 650, which would push back the legal deadline for implementation of "positive train control" from the end of this year until December 2020.
Instead of a blanket extension, "it should be a case-by-case, railroad-by-railroad determination," said Sen. Richard Blumenthal (D-Conn.), who was among those voting "no" and plans to offer as many as 11 amendments when the bill goes to the full Senate. Ranking member Bill Nelson (D-Fla.) promised to work on addressing Blumenthal's concerns before that point.
"The markup of this bill is just the first step," Nelson said.
Also voting "no" were Sens. Joe Manchin (D-W.Va.) and Maria Cantwell (D-Wash.). Their reservations are shared by the Obama administration.
At a hearing earlier in the day, Sarah Feinberg, acting head of the Federal Railroad Administration, agreed that it would be "incredibly difficult" for railroads to meet this December's deadline. But the administration prefers to keep up the pressure on the industry by provisionally certifying individual carriers to continue operating, she said.
"We don't want to end up in a place where we've got railroads waiting another three or four years," she told members of the House Transportation, Housing and Urban Development, and Related Agencies Appropriations Subcommittee.
Positive train control is an umbrella term for an array of anti-crash communications technologies. It has long been assumed that railroads -- which have complained of technical and regulatory barriers -- would fail to make the December deadline, which was set by the 2008 Rail Safety Improvement Act.
The extension bill doesn't say that positive train control isn't needed but simply reflects the reality that "we're nowhere close to getting there," its lead sponsor, Sen. Roy Blunt (R-Mo.), said. The committee's approval was welcomed by the Association of American Railroads, a trade group whose members include Amtrak and large freight carriers.
"This bill recognizes that despite $5.2 billion spent by the industry to date, much remains to be done before [positive train control] can safely operate coast to coast," Edward Hamberger, the association's president and CEO, said in a news release.
Hamberger struck a more neutral note on S. 808, the Surface Transportation Board reauthorization measure, saying that it took into account the need for freight railroads to earn the billions of dollars required each year to maintain and expand their networks "so taxpayers don't have to." The association had last year objected to a similar reauthorization measure introduced by the Commerce Committee's then-chairman, Sen. Jay Rockefeller (D-W.Va.), but opted not to oppose the version approved yesterday.
The board is responsible for regulating the freight rail industry's rates. The new bill, sponsored by current Chairman John Thune (R-S.D.) and Nelson, would expand the board's leadership from three members to five, allow for expanded use of voluntary arbitration to settle rate disputes with shippers more quickly and set timelines for rate reviews. It would also allow the agency to launch investigations on its own in some circumstances, although rate cases would still require a complaint.
Helping to spur the bill were widespread rail car shortages and shipping backlogs that hit the Upper Midwest particularly hard in the winter of 2013 to 2014. A recent Agriculture Department report found that the crisis drove down crop prices throughout the region, Thune said before yesterday's vote. While the board has worked diligently to make sure that those tie-ups don't recur, he added, the crisis highlighted inefficiencies in the agency's operations that "Congress has the ability to address."
In other actions, the committee also approved S. 834, Thune's bill to reauthorize through 2023 the Sport Fish Restoration and Boating Trust Fund, which provides money for fisheries management and other activities, and S. 764, by Sen. Roger Wicker (R-Miss.), to reauthorize and amend the National Sea Grant College Program Act.
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