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ACC AM May 14
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(ACC Blog) How Chemistry Helps Architects Elevate Design Projects
May 13, 2015 | American Chemistry Matters
By Bryan Kuppe
In the design and construction of new homes, schools, offices and other buildings, architects rely on the products of chemistry to help maximize performance, energy efficiency and durability. This week, ACC will join thousands of architects, design professionals and industry leaders at the American Institute of Architects’ (AIA) 2015 ... http://blog.americanchemistry.com/ -
(ACC Mentioned) Cheap Shale Gas To Create Thousands Of New Plastics Jobs, Group Forecasts
May 13, 2015 | MarketWatch
By Steve Goldstein
The U.S. shale-gas revolution was, to some, supposed to spur a manufacturing renaissance, as companies took advantage of cheap, abundant natural gas. It hasn’t happened so far, but maybe it’s just a matter of time. A new report from the American Chemistry Council released Wednesday forecasts the plastics industry will directly ... -
(ACC Mentioned) Shale Gas Expected To Continue Feeding Us Plastics Boom
May 13, 2015 | Plastics News
By Gayle S. Putrich
There has been much speculation on the renaissance the U.S. shale gas boom has created for the plastics industry, and a new report finally provides quantifiable proof that plastics jobs have not only recovered from the recession but are expected to continue to grow by more than 20 percent over the next decade. -
(ACC Mentioned) Shale Gas To Create 462,000 New Jobs In Plastic Manufacturing
May 13, 2015 | Akron Beacon Journal
Due largely to plentiful and affordable natural gas and natural gas liquids from shale formations, U.S. jobs related to plastics manufacturing are expected to grow by 462,000 over the next decade—more than 20 percent—reaching more than 2.7 million, according to a new report. “The Rising Competitive Advantage of U.S. Plastics,” published by... -
(ACC Mentioned) Quality Distribution Inc. Announces Postponement of 2015 Annual Meeting
May 13, 2015 | Nasdaq
By Michael C. Massi
Quality Distribution, Inc. (Nasdaq:QLTY) ("Quality" or the "Company"), a North American logistics and transportation provider with market leading businesses, today announced that its Board of Directors has determined to postpone the 2015 Annual Meeting of Shareholders, originally scheduled for May 28, 2015. The postponement is due to the ... -
(ACC Mentioned) Overnight Regulation: House Chemical Reform Bill Heads To Markup
May 13, 2015 | The Hill - Regulation
By Lydia Wheeler
Welcome to OVERNIGHT REGULATION, your daily rundown of news from Capitol Hill and beyond. It's Wednesday evening here in Washington and we're happy it's hump day. Here's what's happening: THE BIG STORY The House Energy and Commerce Environment and Economy Subcommittee will mark up legislation to reform the nation's... -
(ACC Mentioned) CA Panel Recommends Warning Labels for BPA
May 13, 2015 | Chem.Info
By Andy Szal
A California scientific panel recommended that the state add bisphenol-A to its list of harmful chemicals that must be disclosed by companies. The Developmental and Reproductive Toxicant Identification Committee — a group of scientists appointed by the governor — recently determined that BPA, a common ingredient in plastics and canned... -
House Committee To Markup Toxic Chemical Reform Bill
May 13, 2015 | The Hill - E2 Wire
By Lydia Wheeler
The TSCA Modernization Act first introduced by Environment and the Economy Subcommittee Chairman John Shimkus (R-Ill.), aims to address the shortcomings of the Toxic Substances Control Act, which hasn’t been updated in decades. Paul Tonko (D-N.Y.), Fred Upton (R-Mich), and Ranking and Frank Pallone, Jr. (D-N.J,) have signed... -
The New House Draft: Getting Warmer
May 13, 2015 | Safer Chemicals, Healthy Families
By Andy Igrejas
A new discussion draft of the TSCA Modernization Act was unveiled late yesterday by Chairman Shimkus (R-IL) with the imprimatur as well of Chairman Upton (R-MI), Ranking Member Pallone (D-NJ), and Ranking Member Tonko (D-NY). The new draft is a significant step toward a version of TSCA reform that can enjoy broad support. It’s not ... -
222 Scientists Call for Reduced Use of Stain- and Waterproofing Chemicals Common in Clothing, Carpets and Cookware
May 13, 2015 | Environmental Working Group
“Stain-resistant, Nonstick, Waterproof and Lethal” is how journalist Callie Lyons refers to a chemical called C8 that’s found in the bodies of nearly all humans and animals on the planet. Exposure to this highly fluorinated chemical has been linked to cancer, liver malfunction, hypothyroidism, obesity, ulcerative colitis and decreased immune response ... -
Industries Urge EPA To Overhaul E-Reporting Policies To Reduce Burdens
May 13, 2015 | InsideEPA
By David LaRoss
Major energy, chemical and other industry groups are urging EPA to overhaul a slew of current and proposed electronic reporting (e-reporting) rules for air, water and toxics as part of the agency's retrospective review of its policies, arguing that the current plans to streamline reporting could instead increase burdens for the industries. -
(ACC Mentioned) Chemistry Council: Ozone Proposal Could Affect Billions in Planned Investments
May 14, 2015 | BNA Daily Environment Report
Michael Walls and Lorraine Gershman of the American Chemistry Council speak with Bloomberg BNA reporter Patrick Ambrosio about the challenges that tougher ozone standards would pose to the chemical industry. Walls, the ACC's vice president for regulatory and technical affairs, and Gershman, the ACC's senior director for ... -
(ACC Mentioned) Conservation Groups Say Court Order Needed To End 30-Year Delay in EPA Superfund Rules
May 14, 2015 | BNA Daily Environment Report
By Steven M. Sellers
The U.S. Environmental Protection Agency must be compelled to implement Superfund financial assurance regulations if the EPA's 30-year delay is to end, a lawyer for six environmental conservation groups told the D.C. Circuit May 12 (In re Idaho Conservation League, D.C. Cir., No. 14-1149, oral argument, 5/12/15). -
(ACC Mentioned) Groups Agree EPA Can't Meet Deadlines For Reviews, But No Consensus on Fix
May 14, 2015 | BNA Daily Environment Report
By Patrick Ambrosio
There is consensus among industry and environmental groups that the Environmental Protection Agency isn't capable of meeting the five-year deadline for reviewing air standards for ozone and other pollutants laid out under the Clean Air Act, but there is no agreement on the best way to fix the review process. -
New York State Agency Releases Environmental Impact Statement on Fracking
May 14, 2015 | BNA Daily Environment Report
By Gerald B. Silverman
The New York State Department of Environmental Conservation (DEC) released its long-awaited environmental impact statement (EIS) May 13 on fracking, citing the potential health and environmental impacts of the natural gas drilling practice but not explicitly banning the practice. The statement, after a 10-day notice period, will be followed... -
Murkowski Introduces Legislation To End Ban on U.S. Crude Oil Exports
May 14, 2015 | BNA Daily Environment Report
By Ari Natter
The 40-year-old ban on the export of domestic crude oil would be repealed under legislation unveiled May 12 by Senate Energy and Natural Resources Chairman Lisa Murkowski (R-Alaska). The Energy Supply and Distribution Act of 2015 S. 1312, co-sponsored by Sen. Heidi Heitkamp (D-N.D.) and 11 Republican senators, would authorize exports... -
House Pipeline Legislation Would Slow Projects Down, FERC Official Testifies
May 14, 2015 | BNA Daily Environment Report
By Ari Natter
House legislation designed to speed the federal approval process for new natural gas pipelines would have the unintended consequence of slowing projects down, a senior Federal Energy Regulatory Commission official testified May 13. Ann Miles, director of the Office of Energy Projects at FERC, said the House Energy... -
Official Warns Pipeline Expediting Bill Could In Fact Slow Permitting
May 14, 2015 | E&E Daily News
By Nick Juliano
A draft bill meant to streamline natural gas permitting would codify some existing practices at the Federal Energy Regulatory Commission to improve the process but could also lead to unintended consequences by delaying interagency consultations and related activities, a senior FERC staffer told a House panel yesterday. -
Drilling to Resume Near Site of Gulf Oil Spill
May 13, 2015 | The Hill - E2 Wire
By Timothy Cama
Offshore oil and natural gas drilling is set to resume in June in the area of the Gulf of Mexico where the 2010 Deepwater Horizon explosion and oil spill occurred. LLOG Exploration Offshore, an oil company based in Louisiana, obtained approval last month from the Bureau of Safety and Environmental Enforcement to drill in the Macondo... -
N.M. Democrats Concerned Over Drilling Near Tribal Site
May 14, 2015 | E&E Daily News
By Phil Taylor
Sen. Tom Udall (D-N.M.) yesterday asked Bureau of Land Management Director Neil Kornze to take a closer look at oil and gas leasing near Chaco Canyon in northwest New Mexico, calling the area a rich cultural destination with sacred value to tribes. "It appears that many new leases are getting closer to the Chaco Culture National Historic Park... -
Kayakers Prepare to Meet Shell's Oil Drill Rig in Seattle
May 14, 2015 | AP (in The New York Times)
Protesters opposed to Arctic oil drilling are preparing to paddle out in kayaks to meet Shell's massive offshore drilling rig as it arrives any day now in Seattle, raising the stakes in the battle over oil exploration in the remote Arctic Ocean. The petroleum giant says it is moving ahead with plans to use leased space at the Port of Seattle to load its ... -
EPA to Hold Public Listening Session On Pretreatment Rule for Oil, Gas Operations
May 14, 2015 | BNA Daily Environment Report
By Amena H. Saiyid
Proposed federal technical standards for wastewater effluent from shale gas and oil wells and other unconventional oil and gas wells will be the focus of a public listening session scheduled for May 29, an Environmental Protection Agency official said May 13. The EPA meeting will enable the agency to gather more comment on the proposed... -
Colorado Wellbore Complaints, Tests Data Available
May 14, 2015 | BNA Daily Environment Report
The Colorado Oil and Gas Conservation Commission now is providing information related to public complaints and mechanical tests for drilling wellbores in bulk download form. The commission said May 12 the information is part of its efforts to make more of its data available to the public in different formats. Matt Lepore, director ... -
Red Tape Ties Up Energy on Federal Lands, Murkowski Says During Hearing on BLM
May 14, 2015 | BNA Daily Environment Report
By Alan Kovski
Federal policies affecting energy development on public lands were raked over the coals and defended during a May 13 Senate hearing as Sen. Lisa Murkowski (R-Alaska) critiqued various decisions of the Bureau of Land Management. It's easy to find oil and natural gas companies that are ready, willing and able to buy and develop... -
Nobody Trusts Barack Obama on Energy
May 13, 2015 | National Journal
By Clare Foran and Ben Geman
On top of that, Obama still hasn't made a final decision on the Keystone XL pipeline, which has become the symbol of the national debate over climate change and American energy security. The administration's silence on the pipeline has both sides on edge. The White House points to Shell's advance into the Arctic as evidence of the president's... -
Obama Picks Former Regional Chief As Agency's Head Of Admin
May 14, 2015 | E&E Daily News
By Kevin Bogardus
Karl Brooks has been selected by President Obama for a top slot at U.S. EPA. Among a slate of picks the White House announced yesterday, Obama noted his intent to nominate the former chief of EPA's Region 7 to be the agency's assistant administrator for administration and resources management. Brooks is currently the deputy... -
Senate Unveils Bill to Immediately Kill Clean Power Plan, Set Strict Limits on New Rules
May 14, 2015 | BNA Daily Environment Report
By Anthony Adragna
Sen. Shelley Moore Capito (R-W.Va.) unveiled legislation May 13 that would immediately scuttle the Environmental Protection Agency's carbon pollution regulations for the nation's fleet of power plants and set strict standards for the agency to meet if it pursues new rules. The Affordable Reliable Energy Now Act (no number assigned) has 26... -
Virginia Ponders Joining RGGI as State Weighs How to Meet Clean Power Plan Goals
May 14, 2015 | BNA Daily Environment Report
By Jeff Day
Virginia is considering joining the nine-state Regional Greenhouse Gas Initiative as one of several means of meeting the carbon dioxide reduction goals of the Environmental Protection Agency's proposed Clean Power Plan, a state Department of Environmental Quality spokesman said. Michael Dowd, director of DEQ's air division, believes that ... -
Groups Recommend Changes in RGGI To Comply With EPA's Clean Power Plan
May 14, 2015 | BNA Daily Environment Report
By Gerald B. Silverman
States in the Regional Greenhouse Gas Initiative should take three key steps to comply with the federal Clean Power Plan, including extending RGGI's cap by 10 years, changing the trajectory of scheduled cap reductions and revising the program's cost containment reserve, according to a May 13 report from environmental groups in the Northeast. -
W.Va. Senators Launch Assault On EPA Carbon Rules
May 13, 2015 | E&E News PM
By Jean Chemnick
West Virginia's two senators took the lead today in launching their chamber's flagship bid to kill U.S. EPA's proposed rules for carbon emissions from new and existing power plants, pledging the bill would move quickly through committee. Sen. Shelley Moore Capito (R) sponsored the measure, which heavily borrowed from a bill... -
EPA Critics Seek To Cripple Climate Rules
May 13, 2015 | PoliticoPro
By Andrew Restuccia
The Senate’s EPA critics launched a new offensive on Wednesday to block the Obama administration’s climate change regulations, unveiling legislation that would cripple its planned power plant rules. The bill, which was written by Sen. Shelley Moore Capito (R-W.Va.) and has the backing of Senate Majority Leader Mitch McConnell, would... -
Senate Bill To Block ESPS Takes Tougher Approach Than House Measure
May 13, 2015 | InsideEPA
By Doug Obey
More than two dozen Senate Republicans, joined by Sen. Joe Manchin (D-WV), have floated legislation blocking EPA's proposed greenhouse gas (GHG) rules for new and existing power plants, and setting up additional requirements for EPA to issue any further GHG curbs, language that goes beyond legislation recently approved by a House panel. -
White House NEPA Guidance Provides Certainty But Not Binding, Adviser Says
May 14, 2015 | BNA Daily Environment Report
By Andrew Childers
Federal agencies are not obligated to select project alternatives with the least greenhouse gas emissions under White House guidance on addressing climate change under the National Environmental Policy Act, a White House adviser said. The Council on Environmental Quality's draft guidance on addressing climate change ... -
Private Sector, Young Citizens Will Push U.S. To Climate Action, Ex-EPA Administrator Says
May 14, 2015 | BNA Daily Environment Report
By Anthony Adragna
A combination of private sector engagement, younger generations and successful actions by states and cities may drive Congress to once again become active in addressing climate change, former Environmental Protection Agency administrator and New Jersey Republican Gov. Christine Todd Whitman said May 13. -
Senate GOP Launches Attack On EPA Climate Rules
May 13, 2015 | The Hill - E2 Wire
By Timothy Cama
Senate Republicans introduced a bill Wednesday that would overturn the Obama administration’s landmark climate regulations for power plants and make it nearly impossible to rewrite them. The bill is the GOP’s first major legislative push against the Environmental Protection Agency’s emissions limits since Republicans seized control of... -
Report Touts Benefits of Tighter Ozone Standard
May 14, 2015 | BNA Daily Environment Report
The Environmental Protection Agency should set national ozone at a level of 60 parts per billion to fully realize the health benefits associated with improving air quality, the Center for Effective Government said in a new report. Released May 13, the report highlights the EPA's own estimates that ozone standards of 60 ppb would prevent ... -
EPA Lacks Statutory Authority to Regulate Plastic Microbead Discharges by Consumers
May 14, 2015 | BNA Daily Environment Report
By Amena H. Saiyid
The Environmental Protection Agency lacks Clean Water Act authority to regulate consumer use of plastic microbeads that are entering wastewater discharged to treatment plants, an agency official said at a pretreatment workshop May 13. Janet Goodwin, chief of the EPA Office of Wastewater's Technology and Statistics Branch... -
(ACC Mentioned) Freight Rates Spark Hearing Clash Between Industry, Customers
May 14, 2015 | E&E Daily News
By Jeremy P. Jacobs
Representatives of the freight rail industry yesterday clashed sharply with its customers on whether the sector needs more regulation to ensure fair shipping rates. At issue: the 1980 Staggers Rail Act, the law that virtually saved the rail industry from complete collapse by deregulating it and allowing it to set rates based on market forces. -
(ACC Mentioned) US Chemical, Other Industries Press Congress On Rail Freight Reform
May 13, 2015 | ICIS Chemical Business
By Joe Kamalick
US chemicals producers and a broad range of other manufacturing, agricultural, auto, electric power and steel producers on Wednesday urged prompt action by Congress to reform federal railroad freight rate-setting rules. In a hearing before the House Subcommittee on Railroads, Pipelines and Hazardous Materials, American Chemistry... -
Committee Approves House FY 2016 PHMSA Funds
May 14, 2015 | BNA Daily Environment Report
The House Appropriations Committee approved by a 30–21 vote May 13 its Transportation, Housing and Urban Development appropriations bill for fiscal year 2016 that includes hazmat and pipeline safety funding. Five amendments were adopted, none of which centered on hazardous materials transportation or pipeline safety. -
PHMSA Solicits Crude-by-Rail Reporting Comments
May 14, 2015 | BNA Daily Environment Report
The nation's hazardous materials safety agency is soliciting comments from tank car owners that ship flammable liquids, including crude oil, on a future revised information collection request, the agency will announce May 14. Under a recently published Pipeline and Hazardous Materials Safety Administration rule on flammable liquids-by-rail safety... -
Two Illinois Municipalities Challenge New Oil-Train Rules
May 13, 2015 | The Wall Street Journal
By Laura Stevens
In the latest legal challenge to the federal government’s new crude-by-rail rules, two Illinois municipalities on Wednesday filed a petition asking a Chicago-based federal appeals court to review the rules, saying regulators didn’t go far enough. The village of Barrington and the city of Aurora jointly filed the petition, asking for the U.S. Seventh...
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(ACC Blog) How Chemistry Helps Architects Elevate Design Projects
May 13, 2015 | American Chemistry Matters
By Bryan Kuppe
In the design and construction of new homes, schools, offices and other buildings, architects rely on the products of chemistry to help maximize performance, energy efficiency and durability.
This week, ACC will join thousands of architects, design professionals and industry leaders at the American Institute of Architects’ (AIA) 2015 Convention, to share information on the value of chemistry in design applications as well as building and construction.
ACC also has developed a new continuing education course for architects, in partnership with Hanley Wood University. The course, “Understanding Chemistry in Building and Construction,” reviews how chemical ingredients enhance the performance of building products, and also provides information to help inform product selection. Since its launch in late April, more than 100 architects have taken the course and received a CEU Health Safety Welfare Credit.
After taking the course, architects will: Understand how chemistry enhances material function, features and performance. Be able to identify how sustainable design and environmental analysis tools aid in selection of building materials and systems. Advance knowledge on how material durability, construction function and other features are enhanced by ingredient selection. Gain insight on industry regulation, standards and processes that promote product safety and minimal risk of exposure.
If you’re attending the AIA Convention, please stop by the ACC Booth #3922, to talk to ACC representatives and learn more about the uses and benefits of chemistry in building and construction applications. - See more at: http://blog.americanchemistry.com/2015/05/how-chemistry-helps-architects-elevate-design-projects/#sthash.P08jJjMC.dpuf
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(ACC Mentioned) Cheap Shale Gas To Create Thousands Of New Plastics Jobs, Group Forecasts
May 13, 2015 | MarketWatch
By Steve Goldstein
The U.S. shale-gas revolution was, to some, supposed to spur a manufacturing renaissance, as companies took advantage of cheap, abundant natural gas.
It hasn’t happened so far, but maybe it’s just a matter of time.
A new report from the American Chemistry Council released Wednesday forecasts the plastics industry will directly generate 127,500 new jobs over a decade. That’s because chemicals companies are bringing new production online to take advantage of cheaper energy.
The report says when the ratio of Brent crude oil prices to natural gas prices is over seven, it implies improved competitiveness for U.S.-based producers over foreign competitors. European and Asian producers use an oil-based feedstock to make plastic resins, while the U.S. uses ethane.
During the first quarter, the ratio of oil-to-natural gas prices was above 15.
Also helping U.S. companies become more competitive are rising overseas wages, higher transportation costs and supply chain concerns.
The report forecasts the peak investment will occur in 2018. “These are not turnkey projects,” said Martha Moore, senior director of policy analysis and economics at the trade group, whose members include firms such as 3M, BASF, Dow and DuPont. The group’s forecast is based on announced projects since 2010.
The report also forecasts 173,000 indirect jobs, from suppliers, and 161,000 jobs due to the pay of the new factory employees filtering into local communities. Though sizeable numbers, it a small portion of the some 16 million new jobs the Labor Department projects will be created nationwide over a decade.
Steve Russell, vice president of plastics, said the group didn’t factor in the recent rise in the U.S. dollar, but he said he didn’t expect that to make a significant difference.
“Our largest trading markets for shale-derived resins are in Asia and Latin America, there’s less trade with Europe,” he said. “It’s not something we would expect to have a significant impact on investment, jobs and trade.”
About half of the incremental plastic resin production is expected to be exported, with the remaining half available to the domestic plastic products industry, the group forecasts.
Manufacturing employment more broadly has seen a steep slide. As the millennium started, there were 17.28 million manufacturing positions, compared to 12.32 million in April, according to Labor Department data.
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(ACC Mentioned) Shale Gas Expected To Continue Feeding Us Plastics Boom
May 13, 2015 | Plastics News
By Gayle S. Putrich
There has been much speculation on the renaissance the U.S. shale gas boom has created for the plastics industry, and a new report finally provides quantifiable proof that plastics jobs have not only recovered from the recession but are expected to continue to grow by more than 20 percent over the next decade.
Abundant, accessible and affordable natural gas feedstocks have already driven a 12 percent increase in jobs since the end of the Great Recession in late 2009. According to analysis by the American Chemistry Council released May 13, that trend is expected to explode in the coming years, creating 462,000 jobs through the plastics supply chain.
“The ready availability of large amounts of natural gas is giving the U.S. plastics industry really a renaissance, turning it from among the highest-cost producers to one of the lowest in the world, increasing manufacturing in the United States, increasing exports to markets that we were not exporting to before, and along with all that comes jobs,” said Steve Russell, vice president of ACC’s plastics division. “We are about to see an incredible increase in output in our sector.”
Of the potential $130 billion in overall new investment tied to the shale boom, the ACC report estimates the industry could draw as much as $47 billion in plastics-specific investment, $25 billion of that in new capacity investment alone. The report projects around 97,000 temporary jobs will be created at the peak of the construction phase, ultimately netting about 127,500 direct permanent jobs. Through supply chain impacts, an additional 172,900 indirect jobs will be supported through the supply chain at companies that supply materials, utilities, parts and services.
Job creation will come in waves, the report predicts, starting with a peak in resin investment expected in 2018. Peak investment in ancillary chemistry and products manufacturing will follow in 2019, according to the report, including an additional 5,100 jobs created in the manufacturing of machinery, equipment and molds.
Of the nearly 100,000 total jobs the report says will be supported by the build-out of the U.S. plastics industry, 30,000 jobs will be in construction and capital equipment manufacturing industries with another 29,000 supply chain jobs and 37,600 payroll-induced jobs expected to be generated in local communities throughout the country.
Higher than average wages
Not only will thousands of jobs be created, they will be high-paying jobs, said Russell.
“Plastics materials makers pay workers on average nearly $85,000, which is more than 73 percent higher than the average wage for workers across U.S. industries,” he said.
Of course high pay usually demands high skill levels as well, which could prove problematic in an industry already starved for talent. But Russell and Moore said the report and awareness of the shale boom already in the plastics industry means companies all the way through the plastics supply chain have a few years to target their employee searches and develop talent locally through partnerships with community colleges and vocational programs.
While resin capacity increases will focus job growth in specific geographic areas — most notably Appalachia and the Ohio Valley — but the impact the increased resin supply will have on products “that’s a lot more geographically diverse,” said Martha Moore, ACC’s senior director of policy analysis and economics.
“We see the bulk of it going into the Midwest as of today, partially reflecting trends in automotive,” Moore said. “But we see projects in just about every state.”
Construction and packaging are particularly expected to benefit, as polyethylene and PVC are considered the biggest “winners” in terms of shale prices, along with some polypropylene products.
The U.S. plastics job market is not alone. The shockwaves from the shale boom will be felt around the world with resin exports. The U.S. resin trade surplus is expected to triple by 2030, going from $6.5 billion in 2014 to $21.5 billion over the next 15 years with about half of the U.S.-produced resin being exported, primarily to South American and Asian processors, Moore said.
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(ACC Mentioned) Shale Gas To Create 462,000 New Jobs In Plastic Manufacturing
May 13, 2015 | Akron Beacon Journal
Due largely to plentiful and affordable natural gas and natural gas liquids from shale formations, U.S. jobs related to plastics manufacturing are expected to grow by 462,000 over the next decade—more than 20 percent—reaching more than 2.7 million, according to a new report.
“The Rising Competitive Advantage of U.S. Plastics,” published by economists at the American Chemistry Council (ACC), found that the shale gas production surge has reversed the fortunes of the plastics industry, shifting the competitive advantage to the U.S., where producers mostly use raw materials derived from natural gas. In other regions, plastics makers mainly use an oil-based feedstock.
“A decade ago, the U.S. was among the highest-cost plastics producers,” said Steve Russell, ACC’s vice president of plastics. “Today, America is one of the most attractive places in the world to invest in plastics manufacturing. Even after recent declines in oil prices, our nation has a decisive edge.”
ACC’s report found that the U.S. plastics industry could experience investments of nearly $47 billion in new capacity to produce plastics materials and products, which are expected to create hundreds of thousands of permanent jobs up and down the supply chain over the next decade. In addition, the analysis projects nearly 97,000 temporary jobs will be created during the peak of the construction phase.
The increased supply will be consumed by plastics-intensive industries, such as automotive, building and construction, and packaging, which use modern-day plastics in part to achieve sustainability goals.
In addition, net exports (or U.S. trade surplus) of plastics are expected to triple between 2014 and 2030, growing from $6.5 billion to $21.5 billion, according to a recent report by Nexant Consulting.
“This substantial investment in new capacity is creating more high-paying jobs in the U.S. in this high-tech industry,” said Russell. “Plastics materials makers pay workers on average nearly $85,000, which is more than 73 percent higher than the average wage for workers across U.S. industries. Companies are ‘re-shoring’ jobs to the U.S. as new manufacturing is increasingly being located here at home.”
In addition to contributing to economic growth, the U.S. plastics manufacturing renaissance will supply strong, lightweight auto parts, insulation and packaging that will help industries in the U.S. and around the world to meet energy and greenhouse gas reduction targets.
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(ACC Mentioned) Quality Distribution Inc. Announces Postponement of 2015 Annual Meeting
May 13, 2015 | Nasdaq
By Michael C. Massi
Quality Distribution, Inc. (Nasdaq:QLTY) ("Quality" or the "Company"), a North American logistics and transportation provider with market leading businesses, today announced that its Board of Directors has determined to postpone the 2015 Annual Meeting of Shareholders, originally scheduled for May 28, 2015. The postponement is due to the Company's recent announcement that it has entered into a definitive merger agreement, dated May 6, 2015, to be acquired by funds advised by Apax Partners, L.P.
At a later date, the Company will provide information related to a rescheduled shareholder meeting.
About Quality Distribution
Headquartered in Tampa, Florida, Quality operates the largest chemical bulk logistics network in North America through its wholly-owned subsidiary, Quality Carriers, Inc., and is the largest North American provider of intermodal tank container and depot services through its wholly-owned subsidiary, Boasso America Corporation. Quality also provides logistics and transportation services to the unconventional oil and gas industry through its wholly-owned subsidiaries, QC Energy Resources, Inc. and QC Environmental Services, Inc. Quality's network of independent affiliates and independent owner-operators provides nationwide bulk transportation and related services. Quality is an American Chemistry Council Responsible Care® Partner and is a core carrier for many of the Fortune 500 companies that are engaged in chemical production and processing.
Forward-Looking Statements
This press release contains, and other written or oral statements made by or on behalf of Quality may include, forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995. In addition, we or our executive officers on our behalf, may from time to time make forward-looking statements in reports and other documents that are filed with the Securities and Exchange Commission (SEC) or in connection with oral statements made to the press, potential investors or others. Specifically, forward-looking statements may include, but are not limited to, statements relating to our future economic performance, business prospects, revenue, income, and financial condition; and statements preceded by, followed by, or that include the words "expects," "believes," "intends," "will," "anticipates," and similar terms that relate to future events, performance, or our results. Examples of forward-looking statements in this press release include, but are not limited to, statements about the price, terms and closing date of the proposed transaction and statements regarding shareholder and regulatory approvals. Forward-looking statements are subject to certain risks and uncertainties that could cause actual results, expectations, or outcomes to differ materially from our historical experience as well as management's present expectations or projections. These risks and uncertainties include, but are not limited to: (i) the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement; (ii) the inability to complete the proposed merger due to the failure to obtain Company Requisite Vote or the failure to satisfy other conditions of the proposed merger within the proposed timeframe or at all; (iii) the failure to obtain the necessary financing arrangements as set forth in the debt and equity commitment letters delivered pursuant to the merger agreement, or the failure of the proposed merger to close for any other reason; (iv) risks related to disruption of management's attention from Quality's ongoing business operations due to the transaction; (v) the outcome of any legal proceedings, regulatory proceedings or enforcement matters that may be instituted against Quality and others relating to the merger agreement; (vi) the risk that the pendency of the proposed merger disrupts current plans and operations and the potential difficulties in employee retention as a result of the pendency of the proposed merger; (vii) the effect of the announcement of the proposed merger on Quality's relationships with its customers, operating results and business generally; and (viii) the amount of the costs, fees, expenses and charges related to the proposed merger. Consider these factors carefully in evaluating the forward-looking statements. Additional factors that may cause results to differ materially from those described in the forward-looking statements are set forth in Quality's Annual Report on Form 10—K for the fiscal year ended December 31, 2014, which was filed with the SEC on March 13, 2015. The forward-looking statements represent Quality's views as of the date on which such statements were made and Quality undertakes no obligation to publicly update such forward-looking statements.
Participants in the Solicitation
Quality and its directors, executive officers and certain other members of management and employees of Quality may be deemed to be "participants" in the solicitation of proxies from the shareholders of Quality in connection with the proposed merger. Information regarding the interests of the persons who may, under the rules of the SEC, be considered participants in the solicitation of the shareholders of Quality in connection with the proposed merger, which may be different than those of Quality's shareholders generally, will be set forth in the proxy statement and the other relevant documents to be filed with the SEC. Shareholders can find information about Quality and its directors and executive officers and their ownership of Quality's common stock in Quality's annual report on Form 10-K for the fiscal year ended December 31, 2014 and in its definitive proxy statement relating to its 2015 annual meeting of stockholders filed with the SEC on April 24, 2015. Additional information regarding the interests of such individuals in the proposed merger will be included in the proxy statement relating to the merger when it is filed with the SEC. These documents may be obtained free of charge from the SEC's website at www.sec.gov and Quality's website at https://www.qualitydistribution.com/.
Important Additional Information and Where to Find It
This communication may be deemed to be solicitation material in respect of the proposed acquisition of Quality by Apax and its affiliates. In connection with the proposed transaction, Quality will file with the SEC and furnish to its stockholders a proxy statement and other relevant documents. QUALITY STOCKHOLDERS ARE ADVISED TO READ THE PROXY STATEMENT WHEN IT BECOMES AVAILABLE (INCLUDING ALL AMENDMENTS AND SUPPLEMENTS THERETO) BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION. Investors may obtain a free copy of the proxy statement (when it becomes available) and other relevant documents filed by Quality with the SEC at the SEC's Web site at http://www.sec.gov. The proxy statement and such other documents filed by Quality with the SEC may also be obtained for free from the Investor Relations section of Quality's web site (https://www.qualitydistribution.com/) or by directing a request to: Quality Distribution, Inc., 4041 Park Oaks Blvd., Suite 200, Tampa, FL 33610, Attention: Investor Relations.
Quality and its respective directors, executive officers and other members of their respective management may be deemed to be participants in the solicitation of proxies from Quality's stockholders in connection with the proposed transaction. Information concerning the interests of persons who may, under the rules of the SEC, be considered participants in the solicitation of stockholders of Quality in connection with the proposed transaction, which may be different than those of Quality's stockholders generally, will be set forth in the proxy statement and other relevant documents to be filed with the SEC. Stockholders can find information about Quality and its directors and executive officers and their ownership of Quality stock in Quality's annual report on Form 10-K for the fiscal year ended December 31, 2014 and in its definitive proxy statement relating to its 2015 annual meeting of stockholders filed with the SEC on April 24, 2015. Additional information regarding the interests of such individuals in the proposed transaction will be included in the proxy statement to be filed with the SEC in connection with the proposed transaction.
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(ACC Mentioned) Overnight Regulation: House Chemical Reform Bill Heads To Markup
May 13, 2015 | The Hill - Regulation
By Lydia Wheeler
Welcome to OVERNIGHT REGULATION, your daily rundown of news from Capitol Hill and beyond. It's Wednesday evening here in Washington and we're happy it's hump day.
Here's what's happening:
THE BIG STORY
The House Energy and Commerce Environment and Economy Subcommittee will mark up legislation to reform the nation's toxic chemical laws on Thursday.
The TSCA Modernization Act first introduced by Environment and the Economy Subcommittee Chairman John Shimkus (R-Ill.), aims to address the shortcomings of the Toxic Substances Control Act, which hasn't been updated in decades.Reps. Paul Tonko (D-N.Y.), Fred Upton (R-Mich), and Frank Pallone, Jr. (D-N.J.), the full committee's ranking member, signed on as co-sponsors.
The legislation would force EPA to complete risk assessments for dangerous chemicals within three years, issue risk management rules within 90 days of completing an assessment and preserve states' rights to issue their own protections.
The language of the bill, however, was criticized as confusing when it was first discussed in committee last month. Lawmakers questioned whether the EPA would be required to consider costs when regulating a chemical and whether the bill will create an additional roadblock by forcing the agency to find an exposure risk before assessing a chemical.
"We have all spent a great deal of time studying the law and negotiating solutions, and we have reached a strong bipartisan agreement that works to improve both chemical safety and commerce," Shimkus, Tonko, Upton, and Pallone said in a joint news release. "This is an opportunity to make meaningful reforms that will enhance consumer protections and strengthen our economy."
The American Chemistry Council called the bill balanced and pragmatic, but not everyone is completely pleased with the proposed legislation.
Though a step in the right direction, Safer Chemicals Healthy Families said it's not there yet. The environmental group said it still has concerns, among them EP's inability to turn down industry requests for chemical risk evaluations.
"Taken literally, EPA could wind up spending most of its time responding to industry requests to assess chemicals, rather than evaluating the chemicals that pose the biggest threat to public health and the environment," the group said in a statement online.
ON TAP FOR THURSDAY
The Senate Agriculture, Nutrition and Forestry Committee will hold a hearing to discuss regulatory issues with the Commodity Futures Trading Commission. http://1.usa.gov/1bNk95U
The Senate Foreign Relations' East Asia, the Pacific and International Cybersecurity Policy Subcommittee will hold a hearing entitled "Cybersecurity: Setting The Rules For Responsible Global Cyber Behavior." http://1.usa.gov/1QzWxS0
The House Financial Services Committee will hold a hearing to discuss how to protect consumers and financial data security in the age of computer hackers. http://1.usa.gov/1zRsG38
TOMORROW'S REGS TODAY
The Obama administration will publish 134 new rules, proposed rules, notices and other administrative actions in Wednesday's edition of the Federal Register.
Here's what to watch for:
Synthetic pot: The Drug Enforcement Administration is considering listing synthetic pot as a Scheduled 1 drug under the Controlled Substances Act.
The new rule would add commercially grown synthetic cannabis and its salts to the most dangerous drug list alongside heroin, marijuana, LSD and ecstasy.
The administration said the drugs – UR144, XLR11 and AKB48 – are often abused for their hallucinogenic effects. The DEA temporarily listed the drugs in 2013, but that rule expires on May 15 unless extended or a new rule is created to permanently list the drugs.
The public has 30 days to comment. http://bit.ly/1PjMa7J
Food Safety: The Department of Agriculture's Food Inspection Service has made its final revisions to compliance guidelines food producers must follow to validate plans for controlling food safety hazards.
The Federal Meat Inspection Act and Poultry Products Inspection Act requires establishments to adopt measures to prevent or control the risk of foodborne illness from meat or poultry products at each stage of the production process. http://bit.ly/1Iyveqb
NEWS RIGHT NOW
Ammo: House Democrats are pushing legislation requiring face-to-face ammunition sales. http://bit.ly/1PH4ene
Meat: The Obama administration finalized a rule Wednesday that will require meat packers to label beef that is mechanically tenderized. http://bit.ly/1PH4gLT
Chemicals: Members of the House Energy and Commerce Committee will mark up new legislation to reform the nation's toxic chemical laws on Thursday. http://bit.ly/1EF7fhI
Credit: Democratic lawmakers have introduced legislation to prohibit creditors from discriminating against lesbian, gay, bisexual and transgender people. http://bit.ly/1K6I4fN
Facebook: The social media website said it's going to require its contractors to pay employees $15 an hour, David McCabe, of The Hill reports. http://bit.ly/1L2tGTm
LGBTs: An Arkansas town is challenging a state law aimed at preventing local protections for lesbian, gay, bisexual and transgender people, the AP reports. http://bit.ly/1IyshpF
$20: A group wants to kick Andrew Jackson off the $20 bill and replace him with Harriet Tubman, The Washington Post reports. http://wapo.st/1HbUS0G
BY THE NUMBERS
3 minutes: How long USDA recommends cooking each side of a steak on a grill to reduce the risk of foodborne illnesses.
145 degrees F: The internal temperature USDA recommends cooking beefsteaks to.
3 minutes: How long USDA recommends allowing meat to rest before serving.
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(ACC Mentioned) CA Panel Recommends Warning Labels for BPA
May 13, 2015 | Chem.Info
By Andy Szal
A California scientific panel recommended that the state add bisphenol-A to its list of harmful chemicals that must be disclosed by companies.
The Developmental and Reproductive Toxicant Identification Committee — a group of scientists appointed by the governor — recently determined that BPA, a common ingredient in plastics and canned goods, should qualify under Proposition 65.
The 1986 law requires the state to list chemicals known to cause cancer or reproductive problems and requires companies using those chemicals to notify the public. The BPA labeling requirement would specify that the compound could cause reproductive harm in women.
The chemical industry slammed the decision and said it contradicts both the scientific record and input from federal regulators.
Joseph Perrone, chief scientist for the nonprofit Center for Accountability in Science, said California regulators stirred up "more needless fear about safe products."
The American Chemistry Council sued the state in 2013 over its efforts to add BPA to the Prop 65 list; that litigation is still pending. Earlier this year, the industry group launched a spirited defense of the chemical, which noted that U.S. and European regulators found that it posed "no health risk to consumers of any age group."
Environmental groups and public health advocates, however, pointed to a range of scientific studies linking BPA to physical and behavioral maladies. California and 12 other states previously took steps to limit its inclusion in baby bottles, cups or other consumer products.
"The state's experts looked past industry attempts to manufacture doubt, and followed the extensive literature showing BPA's harmful effects," wrote Avinash Kar, an attorney with the Natural Resources Defense Council.
The DART committee ruling will proceed to a second scientific examination to determine at what level the chemical becomes harmful. A disclosure requirement would not take effect for at least another year — if at all — according to California environmental officials. -
House Committee To Markup Toxic Chemical Reform Bill
May 13, 2015 | The Hill - E2 Wire
By Lydia Wheeler
The House Energy and Commerce Environment and Economy Subcommittee will mark up a new draft of legislation to reform the nation’s toxic chemical laws on Thursday.
The TSCA Modernization Act first introduced by Environment and the Economy Subcommittee Chairman John Shimkus (R-Ill.), aims to address the shortcomings of the Toxic Substances Control Act, which hasn’t been updated in decades.
Paul Tonko (D-N.Y.), Fred Upton (R-Mich), and Ranking and Frank Pallone, Jr. (D-N.J,) have signed onto the bill as co-sponsors. The legislation would force EPA to complete risk assessments for dangerous chemicals within a three-years, issue risk management rules within 90 days of completing an assessment and preserve states’ rights to issue their own protections
The language of the bill, however, was criticized as confusing when it was first discussed in committee last month. Lawmakers questioned whether the EPA would be required to consider costs when regulating a chemical and whether the bill will create an addition roadblock by forcing the agency to find an exposure risk before assessing a chemical.
“We have all spent a great deal of time studying the law and negotiating solutions, and we have reached a strong bipartisan agreement that works to improve both chemical safety and commerce,” Shimkus, Tonko, Upton, and Pallone said in a joint news release. “This is an opportunity to make meaningful reforms that will enhance consumer protections and strengthen our economy.”
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The New House Draft: Getting Warmer
May 13, 2015 | Safer Chemicals, Healthy Families
By Andy Igrejas
A new discussion draft of the TSCA Modernization Act was unveiled late yesterday by Chairman Shimkus (R-IL) with the imprimatur as well of Chairman Upton (R-MI), Ranking Member Pallone (D-NJ), and Ranking Member Tonko (D-NY).
The new draft is a significant step toward a version of TSCA reform that can enjoy broad support. It’s not there yet, however. We’re hopeful that the remaining issues can be addressed as the Energy and Commerce Committee moves forward.
First, the members have negotiated a balance between the role of state and federal governments in chemical reform. No state will be preempted from acting on an existing chemical until and unless EPA takes action or exonerates the chemical after a full review. At that point states will be able to co-enforce the federal restriction. What states have already done won’t be rolled back and certain state activities will remain outside the scope of preemption altogether. There are important details that we are still analyzing, and additional changes may be needed, but overall, on this very contentious issue, the four members appear to have threaded the needle fairly well.
They have also addressed a number of the other issues we raised in our testimony on April 14. The hurdle to EPA initiating an assessment has been removed, and EPA is now required to initiate 10 assessments per year. That is a small number, certainly, but it is clearly achievable. The industry-initiated assessments will now have the same deadline as the ones EPA initiates. They’ve added a provision that requires EPA to screen existing chemicals for the properties of persistence and bioaccumulation and put those chemicals on a path for expedited action.
They have also made additional changes to address the role that cost-benefit analysis has played in paralyzing the current TSCA program. Unfortunately, in spite of these changes, this issue is still not solved in the new draft, in our view.
In our testimony, we said that costs should not be a factor in deciding whether a chemical poses a risk and that EPA rules should be required to fully protect against the risk. Costs should come in, we argued, only in choosing among options that protect the public, or as a factor in granting time-limited exemptions for critical uses. EPA made similar points in their testimony. A generous reading of the plain English in the new draft suggests an attempt to follow this formula. However, plain English and generosity have had little to do with our court system where TSCA is concerned. EPA was blocked from regulating asbestos – in spite of its enormous death toll – because of cost considerations 24 years ago. The role of costs versus health concerns, and its legal interpretation, has been the critical issue in TSCA and the draft needs more work to get it right. It’s fundamental.
Another major problem is that EPA still has no discretion to turn down an industry request to initiate a risk evaluation. Taken literally, EPA could wind up spending most of its time responding to industry requests to assess chemicals, rather than evaluating the chemicals that pose the biggest threat to public health and the environment. EPA should have discretion to cap these reviews so that they do not outweigh the reviews EPA initiates of its own accord in a given year.
Finally, the provision for expedited action on persistent and bio-accumulative chemicals is partially undermined by a mechanism whereby a company can yank the chemical off the fast track on to the regular track. It would be so much better if the bill just required early action on these most dangerous chemicals in a straightforward way.
We’re still evaluating the bill and will likely communicate our position on the pros and cons more fully and formally to the Energy and Commerce Committee.
At first blush, however, the movement is mostly in the right direction and it brings the bill within striking distance of meaningful, if limited, reform, if the Committee continues its work.
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May 13, 2015 | Environmental Working Group
“Stain-resistant, Nonstick, Waterproof and Lethal” is how journalist Callie Lyons refers to a chemical called C8 that’s found in the bodies of nearly all humans and animals on the planet. Exposure to this highly fluorinated chemical has been linked to cancer, liver malfunction, hypothyroidism, obesity, ulcerative colitis and decreased immune response to vaccines in children.
Highly fluorinated chemicals (also known as PFCs or PFASs) are now everywhere – deep in the ocean, on mountaintops and in nearly all living creatures. Scott Mabury, a professor of environmental chemistry at the University of Toronto, has said that this class of chemicals will last in the environment for geological time – that is, millions of years – perhaps even longer than humanity. Making and using chemicals that could be harmful and persist longer than mankind is a serious matter, and it should not be undertaken lightly.
Just days ago, more than 200 scientists from 40 countries reached a consensus * : The entire class of highly fluorinated chemicals such as C8 should only be used when it is essential and there are no suitable replacements. The Madrid Statement documenting this consensus was published May 1 in Environmental Health Perspectives (EHP), a high-impact, peer-reviewed scientific journal.
Highly fluorinated chemicals such as C8 and its chemical cousins are used in outdoor and fashion clothing, carpets, furniture, cookware, food contact paper and even some cosmetics. One question to ask is: Do we really need such chemicals in everyday products? Safer substitutes are already available for water repellency but not yet for oil-repellency. Is it worth risking long-term harm for such a small convenience?
When C8 was released into the water supply near Teflon manufacturing plants in Parkersburg, West Virginia over many years, tens of thousands of people were exposed and many developed health problems believed to be related to the exposure. The disturbing results of this large-scale inadvertent human study contributed to the recent phaseout of C8 in the U.S. You can read EWG’s report about it here.
However, C8 is being replaced with similar chemicals (called C6) from the same family. They also do not ever break down, and studies on their impact on health are limited.
Must people be the guinea pigs to determine if C6 and other fluorinated alternatives are as harmful as C8? Before adding any fluorinated chemicals to consumer products, we should ask whether we really need them. Can the same function be achieved with a safer solution? Maybe we need fluorinated chemicals in our outdoor gear if we’re going to climb Mount Everest, but do we need them in our surfing shorts?
Read more about these harmful chemicals at greensciencepolicy.org/highly-fluorinated-chemicals/
What can consumers do to reduce the use of highly fluorinated chemicals? Tell retailers and manufacturers you want products without fluorinated chemicals.
Don’t purchase products that are oil-repellent, stain-resistant, waterproof and nonstick unless you really need them.
Avoid cosmetics with PTFE or any word containing “perfluor” or “polyfluor” on the ingredients list.
Purchase cast-iron, glass or ceramic cookware rather than non-stick.
Avoid microwave popcorn and foods wrapped in grease-resistant paper.
Support companies committed to phasing out fluorinated chemicals, such as the apparel brands that have joined Greenpeace’s Detox campaign and the fast food chains that removed them from food packaging as a result of EWG’s campaign. -
Industries Urge EPA To Overhaul E-Reporting Policies To Reduce Burdens
May 13, 2015 | InsideEPA
By David LaRoss
Major energy, chemical and other industry groups are urging EPA to overhaul a slew of current and proposed electronic reporting (e-reporting) rules for air, water and toxics as part of the agency's retrospective review of its policies, arguing that the current plans to streamline reporting could instead increase burdens for the industries.
The American Petroleum Institute (API) in recent comments said that while it supports the increased use of electronic reporting, "the potential resource savings is significantly diminished, if not eliminated, by EPA's continuing inability to provide the necessary instructions and related reporting tools," especially for a waste e-manifest system that the agency is developing under the Resource Conservation & Recovery Act (RCRA).
Water associations, including the Utility Water Act Group (UWAG) and the National Association of Clean Water Agencies, in separate comments urged EPA to rework its pending final rule for e-reporting in the National Pollutant Discharge Elimination System (NPDES) program for Clean Water Act (CWA) discharge permits.
The American Forest & Paper Association is also raising concerns over e-reporting, telling EPA in comments that it should allow industry to continue paper reporting where that is the less preferable option, noting that "in some cases, electronic reporting can be more burdensome to members of the regulated community."
The various industry groups outlined their concerns over EPA's push for e-reporting as part of their broader comments filed on the agency's March 9 Federal Register notice seeking public input on EPA's periodic retrospective review of its rules. The ongoing review is required under President Obama's Executive Order 13563 on improving regulatory review and Executive Order 13610 on reducing regulatory burdens.
"The EPA is particularly seeking public input on how the agency can promote regulatory modernization through business-process streamlining, facilitated by improved technology," said the notice, setting an April 8 deadline for comment.
The industry groups' comments recently added to the agency's regulatory docket for the notice show that a common concern among various sectors is potential adverse consequences from e-reporting mandates.
EPA has touted the idea of electronically submitting data required under various laws such as the Clean Air Act, CWA and RCRA, saying it can significantly cut burdens associated with submitting the data by paper.
Reducing Burdens
The shift to e-reporting is also part of EPA's move toward a "Next Generation" compliance system, intended to reduce burdens on both the regulated community and regulators through enforcement and monitoring mechanisms that use technological improvements to reduce labor burdens associated with implementation.
The industry groups argue that unless the agency takes care to harmonize its reporting requirements with states' water and toxics regimes, e-reporting will grow workloads rather than easing them because regulated entities will be forced to maintain separate databases and reporting mechanisms for each.
"EPA [is] rushing implementation of electronic reporting, despite knowing that states could not meet the unrealistic deadlines set for the program. . . . As UWAG suggested [in prior comments], this rush to modernize could lead to duplicative reporting, which is inconsistent with the national policy to 'prevent needless duplication,'" according to the comments filed by UWAG, which represents energy companies affected by EPA's water policies.
The agency's long-awaited NPDES e-reporting rule, first proposed July 30, 2013, would require dischargers to electronically submit most data required under the program. But industry has expressed concerns that the rule could curb the delegated authority of state programs and overburden permitted facilities.
"While electronic reporting in the long-term should improve the efficiency of permit-related reporting, with the ultimate goal of simplifying the reporting process, it is not a panacea. In a number of cases reported by our members, rigid electronic reporting formats have created a process that is now more difficult, more resource-intensive and potentially results in poorer data quality," says NACWA, representing wastewater utilities.
API is warning of potential difficulties under the RCRA e-manifest system, designed to streamline the process of tracking shipments of materials considered "hazardous" under the waste law. API says in its comments such shipments are subject to regulation by states and other federal agencies in addition to EPA, and that if the other agencies continue to require paper manifests the e-manifest system will only add a new compliance burden.
"[T]he e-Manifest system should be fully integrated with Department of Transportation (DOT) hazardous materials shipping requirements such that the use of the system will fully satisfy DOT shipping paper requirements for hazardous wastes. If generators or transporters are required to maintain paper copies of manifests to comply with DOT requirements, it will defeat much of the purpose of the e-Manifest system," API says.
Regulatory Review
In addition to concerns over e-reporting requirements, industry groups used their comments on the retrospective review notice to call for other changes to the agency's various regulations. They argued that some rules, or parts or rules, are either overly burdensome or overlap with other EPA rules or other agencies' efforts.
For instance, the agricultural industry association CropLife in its comments on the notice argued for streamlining of EPA's endocrine disruptor screening program, which seeks to evaluate potential impacts on human hormones from many chemicals, including pesticides. The group suggested that the agency should allow longer notice-and-comment periods on scientific reviews of chemicals and increased transparency on testing methods.
The Michigan Manufacturers Association in its comments targeted air rules that it says have become duplicative, noting that a single facility can be subject to separate emissions, technology and reporting requirements under as many as six separate major Clean Air Act regimes.
At a minimum EPA should seek to integrate air reporting and recordkeeping mandates, the group said. "Having to ability to consolidate, simplify and subsume these requirements into a single, cohesive set benefits everyone, the regulated source, the enforcing air agencies and the public by reducing regulatory burden and improving understanding of compliance obligations while achieving desired emission levels," the group argued.
Meanwhile, the Clean Energy Group, a power sector association, says disclosure rules for substances under the Toxics Release Inventory (TRI) have become difficult to manage because different facilities report in substantially different ways, blocking the development of standardized methods. "TRI data are not easily interchangeable between companies because the allowed methodologies are so diverse. A tool . . . could standardize different methods/calculations thereby reducing the burden on industry," the group says.
The Society of Chemical Manufacturers & Affiliates (SOCMA) said in its comments that EPA should implement a broad regulatory review framework in all its new rules to prevent duplication and inefficiencies from developing after rules are issued. "In particular, it should specify what metrics should be evaluated, at what future date, in order to assess how well the rule is working and how it might be made to work more effectively or efficiently," SOCMA says.
Peabody Energy used its comments to call on the agency to pare back a host of controversial major rules in order to reduce regulatory complexity, including greenhouse gas emissions standards for power plants and a pending final rule undergoing White House pre-publication review on which waters are protected by the CWA. "Instead of streamlining, EPA appears to be set on expanding permits unnecessarily," the company says.
Pending Legislation
Lawmakers critical of EPA are advancing bills they say would rework burdensome EPA rules. For example, the House Judiciary Committee in an April 15 markup voted 15-10 to approve H.R. 427, which would require congressional approval for EPA and other agencies' "major" rules, and which supporters have touted as a way to restrict environmental policies such as the CWA jurisdiction rule.
The bill cleared the full committee along party lines after Republicans voted down a series of amendments offered by Democratic lawmakers that would have exempted classes of rules from its review policies, including those intended to protect human health, those whose benefits have been determined to outweigh their costs and those expected to result in net job growth.
Other pending regulatory reform bills include H.R. 1155, which would establish a panel to identify "unnecessarily burdensome" rules, H.R. 348, which would accelerate environmental reviews of permits. Also pending in Congress is H.R. 712, which would set new requirements for public participation in settlements between citizen groups and agencies that would set deadlines for rulemaking. EPA critics, including Republican lawmakers, have termed this practice "sue and settle." However, the agency and environmentalists have countered that the settlements do not affect the content of rules.
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(ACC Mentioned) Chemistry Council: Ozone Proposal Could Affect Billions in Planned Investments
May 14, 2015 | BNA Daily Environment Report
Michael Walls and Lorraine Gershman of the American Chemistry Council speak with Bloomberg BNA reporter Patrick Ambrosio about the challenges that tougher ozone standards would pose to the chemical industry.
Walls, the ACC's vice president for regulatory and technical affairs, and Gershman, the ACC's senior director for environment and process safety, explain in a phone interview why the ozone standards are such a high-priority issue for the industry and why the Environmental Protection Agency has the authority to set a standard outside the range suggested by its independent science advisers. Walls also highlights the need for Congress to act to block the EPA from setting more stringent standards.
The EPA has a court-ordered deadline of Oct. 1 to issue a decision on revising or retaining the current national ambient air quality standards for ozone of 75 parts per billion established in 2008. The agency in 2014 proposed to revise both the primary health-based and secondary welfare-based standards in the range of 65 ppb to 70 ppb. The proposal drew more than 350,000 comments from state environmental agencies, which are concerned about implementing a stronger standard; industry groups, which would like to see the current standards fully implemented before new standards are set; and environmental and public health groups, which argue that even tougher health-based standards are needed to protect children with asthma and other vulnerable populations.
This is Part V of a six-part series of Q&As on the ozone standards. The series will conclude May 15 with an interview highlighting the view of the American Public Health Association on the EPA's proposal.
This interview has been edited for clarity and length.
Bloomberg BNA:
The ACC has been one of the more outspoken critics of the EPA's ozone proposal. Why are the standards such a priority issue for the chemical industry?
Michael Walls:
The reason the potential for a lower ozone standard is of such concern is it has some direct implications for our industry's ability to bring new investment online. You may recall that, especially because of the greater availability of reliable supplies of energy here in the U.S., notably natural gas and natural gas liquids, our industry has been planning over 220 projects worth $127 billion of investment. All of that new investment, whether it is a modification or a completely new plant, must meet the new ozone standards. The EPA's proposal to significantly lower the standards threatens to delay, if not rewrite, plans for those investments.
Offsets May Not Be Available.
Bloomberg BNA:
If the EPA sets a more-stringent standard, there would likely be additional areas designated as nonattainment. How does a nonattainment designation affect current chemical facilities already operating and planned new investments?
Walls:
In that particular case, what happens is any area that doesn't meet the current standard is designated as being in nonattainment. Currently, there are nonattainment areas in 26 states that don't meet the standard of 75 ppb. Many of those nonattainment areas are around highly populated industrial and manufacturing centers. What happens once an area is in nonattainment, the manufacturers in that area that are proposing to modify or make a new investment either have to scale back their plans to reduce emissions, close parts of their facilities or, what's more often the case, have to buy offsets. For nitrogen oxides, for example, offsets are running around $175,000 per ton. For volatile organic compounds, the offsets are averaging around $275,000 a ton. A manufacturer planning an expansion or a new investment has to buy those offsets, even as their permit application itself is pending. So, it adds significantly to the cost of the permit. It can be north of $10 million for a facility just to buy the offsets, and that doesn't even get to the engineering and operating costs associated with that particular facility. Also, those offsets basically have to be generated from others who have to be willing to sell those emissions in a given nonattainment area. In some of these areas where you have facilities that have already moved to more state-of-the-art emissions controls, there may not even be much of an offset market available, or what is available may be very, very expensive. We contend that a lower ozone standard would result in slower growth and fewer jobs across the country.
Bloomberg BNA:
A lot of the industry conversation about the ozone standard has focused on the potential economic impacts. Given that the Supreme Court has held that the EPA cannot consider cost in deciding where to set the standards, what kind of change do you hope this type of messaging on the economic impacts can accomplish?
Walls:
We think it is important to recognize that it is not just a simple matter of relying on science. We do believe there are some fundamental flaws in the science that EPA relied on here. The Clean Air Scientific Advisory Committee recommended an ozone range between 60 ppb and 70 ppb. We don't believe the science is there to justify that, but we think it is also important for communities to understand that existing jobs and new jobs are threatened. Those reductions don't only come from manufacturing facilities. An ozone standard has impacts throughout the economy, as state and local governments would look to achieve their reductions from motor vehicles, from fuels, from consumers, as well as the manufacturing community. Also, some of the ozone compliance measures are tied to the availability of federal highway and transit funding. Any particular area's failure to achieve the standard has some significant direct impacts, and we are trying to make sure that those impacts are well-recognized. I want to add that we have made, in part because of the Clean Air Act overall, significant improvements in air quality over the last decades. In our view, the science has not established that we need a lower ozone standard. We think it would be better if the EPA focused first on getting the rest of the country in attainment with the current standard before we embark on a process to further lower the standard from where it is now.
Challenges of Five-Year Review Cycle.
Bloomberg BNA:
Currently, the Clean Air Act requires the EPA to review its standards every five years. What kind of challenges does that frequent review process pose to industry?
Walls:
It poses more of a challenge in today's environment, where we have all of these investments that are basically ready. I'm not going to say they're all shovel-ready, but we certainly have a number of planned investments. In past years, we haven't had that, so for us the impact at this point in time is particularly critical. I think you put your finger on the fact that one of the challenges in this area is imposed by the Clean Air Act itself—this review period. The fact remains that the 2008 standard has not been fully implemented. The EPA has just recently completed its guidance on implementing the 2008 standards. There is a significant job that needs to be done, and our view is EPA should focus its resources on that, of attaining the health benefits from achieving the current standard, before we go lowering them. Let me use an example: Just last year, the state of Louisiana finally came into attainment with the current standards. At 65 ppb, almost the entire state of Louisiana would be placed in nonattainment again through no fault of Louisianans or the vibrant economy that Louisiana has right now. The state would still be penalized once a lower ozone standard is implemented.
Industry Looks for Congressional Action.
Bloomberg BNA:
There are some legislative proposals in Congress to address the ozone standard. One bill (Clean Air, Strong Economies Act—S. 751, H.R. 1388) from Sens. Thune (R-S.D.) and Manchin (D-W.Va.) and a separate bill (Ozone Regulatory Delay and Extension of Assessment Length Act—S. 640) from Sen. Flake (R-Ariz.). The bills take different approaches to delaying the EPA's review. Does ACC have a favored approach? Is there one that you think is the best way forward?
Walls:
We've supported both the CASE Act and the ORDEAL Act. I think there is other legislation that has been introduced that attempts to put some limits around EPA's ability to lower the ozone standards, at least in many cases attaching some conditions to lowering the standards. We think it is very important for Congress to act quickly on this legislation. The EPA basically has to make a decision before the end of the fiscal year on what it is going to do here. We think the quicker Congress can act, the more certainty the business community will have about lowering the ozone standard and any potential impacts it has.
Bloomberg BNA:
Both the CASE Act and the ORDEAL Act were introduced last Congress and didn't move. Do you think there is a better chance for congressional action now, given the change in Senate leadership and that there is a proposal out of the EPA that can be pointed to?
Walls:
Yes, in the sense that, clearly, the political dynamic has changed. I can't speculate on whether or not Congress will be able to move these anytime soon, but it is certainly our hope that the value of giving EPA clear direction on what needs to happen before the standard is lowered can be realized. We think that these approaches commend themselves to congressional attention as soon as possible.
EPA's McCarthy Has ‘Complete Discretion.'
Bloomberg BNA:
The ACC has urged EPA Administrator Gina McCarthy to use the discretion that she has in deciding where to set the final ozone standards. What kind of discretion does the administrator have and can she use that discretion to retain the current standards, given the advice of the Clean Air Scientific Advisory Committee and EPA staff?
Walls:
In my view, the administrator retains complete discretion to set the standards, including not reducing them. I'd note that in EPA's request for comments [on the ozone proposal], they specifically asked for comments on the question of not reducing the standards. We think there is a compelling case for that at this point in time, for maintaining the current standard, at least until such time as there is more complete implementation of the 2008 standard.
Lorraine Gershman:
Looking back over past NAAQS [national ambient air quality standards], the administrator has not always agreed with CASAC's recommended levels. Most of these have been challenged in court, and the EPA has generally won every single case. So, there is case law that says if Administrator McCarthy deems that she wants to go outside of the CASAC's recommended levels on this based on the science, that she has the discretion to do so. It's not like this would be the first time that this happened.
Bloomberg BNA:
Supporters of a stronger ozone standard point to scientific data linking ozone to increased asthma attacks and other negative health effects. For the ACC and other groups that oppose revising the standards right now, how important is it to keep the public health factor in mind when voicing opposition to the standards?
Gershman:
The thing that I think is important with the messaging is that focusing on public health, what we're really asking the EPA to do here is get everyone to the same 75 ppb level. The way it is now, California is so far from even attaining the current standard that EPA has carved out measuring the health benefits from a lower standard into a completely separate bucket for California. I think it is important to recognize that part of what we're asking the EPA to do is have the entire country reach the same level of providing protective health benefits.
Walls:
The only other thing I'd add to that is there is a significant question about background levels of ozone. As you get to a lower standard, you are getting very close to what many experts would recognize as background levels of ozone—ozone levels that are not going to be abated because of any particular control measure. That begs an important question of should you continue to reduce the standard even when you're at background levels? Also, I want to make clear that there is a role for these health considerations in these standards. Congress made that clear in enacting the provision itself.
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May 14, 2015 | BNA Daily Environment Report
By Steven M. Sellers
The U.S. Environmental Protection Agency must be compelled to implement Superfund financial assurance regulations if the EPA's 30-year delay is to end, a lawyer for six environmental conservation groups told the D.C. Circuit May 12 (In re Idaho Conservation League, D.C. Cir., No. 14-1149, oral argument, 5/12/15).
The three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit questioned whether the groups had standing to file the writ of mandamus.
But oral arguments largely focused on the EPA's delay in producing regulations required by the Comprehensive Environmental Response, Compensation and Liability Act when it was enacted in 1980.
The CERCLA requirement concerns financial assurances for certain high-risk industries—here mining, chemical manufacturing, petroleum and coal manufacturing and electric power generation—to assure that they have sufficient financial responsibility to remedy environmental damage caused by their operations (42 U.S.C. §9608(b)).
It remains to be seen whether Justice Department assurances of sufficient rule-making progress will be enough to avoid a court order forcing the agency to issue the regulations or take other action.
“You have a really strong case,” Judge Patricia Millett told Amanda Gooden, of Earthjustice in Seattle, who argued on behalf of Idaho Conservation League, Earthworks, Sierra Club, Amigos Bravos, Great Basin Resource Watch and Communities for a Better Environment.
“Thirty years and this thing never seems to move from the back burner to the front burner,” Millett said. “There's always some other priority.”
Gooden said declarations filed with the petition supported standing, adding that the declarants are exposed to coal ash in the air and aren't able to swim in rivers because of mining pollution.
On the merits, Gooden emphasized the importance of the financial assurance rules in furthering the goals of CERCLA, ensuring “quick cleanups” of hazardous material releases in industries that pose “very high risks.”
Here, Gooden argued, EPA's delay is excessive not only because of 30 years of inaction, but also because the agency decided in 2010 that financial assurance rules were necessary for the four industries.
These circumstances satisfy the standard for issuance of the writ of mandamus set forth Telecomm. Research & Action Ctr. v. FCC, 750 F.2d 70 (D.C. Cir. 1984), Gooden said.
EPA Inaction Questioned
Justice Department lawyer John Sullivan argued against issuance of the writ of mandamus and was sharply questioned by the court, particularly over what the EPA has done to advance the rule-making process for the mining industry.
The agency created a “proposed rule framework” for proposed regulations, Sullivan said, and has taken steps to begin distribution of the framework to stakeholders.
Sullivan said he hadn't reviewed the proposal, but represented to the court that the EPA “has done a lot” to deal with the financial assurance rules, beginning in 1983.
Those efforts faltered, he said, when the agency “realized they didn't have the personnel or contractor funding to do it.”
Federal preemption issues are enmeshed in the proposal, Sullivan added, because some states have enacted their own financial assurance regulations for industries involving hazardous substances.
The court pressed Sullivan for details about the framework and asked whether it was a draft of a proposed notice of rule-making, an outline or something else.
“It is a set of concepts of how the rule is going to work, from identifying facilities based on risk to estimating costs,” Sullivan said.
He also questioned whether the financial assurance rules would benefit the Superfund or the EPA.
“It's highly speculative to EPA right now—and that's what it's concerned about—that EPA will even benefit from the financial assurance rules,” Sullivan said, adding that a company must default before the government can gain access to any finances.
A proposed rule for the mining industry is expected by August 2016 and a final rule by August 2019, Sullivan said, adding that the agency hadn't decided whether to issue regulations for other industries.
Mining Industry Speaks Up
Michael Giannotto of Goodwin Procter in Washington, D.C. argued on behalf of the National Mining Association, which moved to intervene in the case.
He questioned the dangers the conservation groups posed and noted that the EPA could still decide that no regulations were necessary.
The court questioned Giannotto on NMA's right to intervene, but he argued association members “have a direct and substantial interest” in the matter.
“From our point of view, if the agency gets rushed through this, it may reach the wrong decision,” Giannotto said.
That remark brought a reply from the court that the EPA was aware the association's position since 2009 and that, in any event, NMA would have the right to comment on any proposed rule.
Other movant-intervenors in the case include the American Chemistry Council, the American Petroleum Institute and Freeport-McMoRan, Inc.
Oral arguments in the case were heard by Judges Karen LeCraft Henderson, Judith W. Rogers and Patricia A. Millett.
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(ACC Mentioned) Groups Agree EPA Can't Meet Deadlines For Reviews, But No Consensus on Fix
May 14, 2015 | BNA Daily Environment Report
By Patrick Ambrosio
There is consensus among industry and environmental groups that the Environmental Protection Agency isn't capable of meeting the five-year deadline for reviewing air standards for ozone and other pollutants laid out under the Clean Air Act, but there is no agreement on the best way to fix the review process.
The U.S. Chamber of Commerce, the National Mining Association and other industry organizations support legislation (S. 640) from Sen. Jeff Flake (R-Ariz.) that would establish a 10-year review cycle for the national ambient air quality standards, a change that those groups said would allow more time to implement standards before they are changed, provide industry with more certainty and reduce the number of deadline lawsuits that result in negotiated deadlines between the EPA and environmental groups.
However, critics of that proposal told Bloomberg BNA that the review process already takes about 10 years in practice due to the EPA's repeated failure to meet the five-year deadline, so extending the review period would only result in further delays to a process that is needed to ensure that public health is protected. Representatives of the Natural Resources Defense Council and the Environmental Integrity Project identified providing the EPA with additional budgetary resources needed to do the reviews and setting more incremental deadlines during the review as ways to improve the current process.
The Clean Air Act requires the EPA to review at five-year intervals and make revisions as appropriate to its national ambient air quality standards for the six “criteria” pollutants: ozone, particulate matter, sulfur dioxide, nitrogen dioxide, carbon monoxide and lead.
The EPA told Bloomberg BNA in an e-mail that the agency “always strives” to meet that five year deadline. However, a review of EPA regulatory documents showed that almost all of the reviews completed by the EPA in the last 25 years had a deadline that was established under a citizen lawsuit filed after the EPA missed its statutory deadline.
Jeff Holmstead, a partner at Bracewell & Giuliani LLP and former EPA assistant administrator for air and radiation under President George W. Bush, told Bloomberg BNA that there are many Clean Air Act deadlines that the EPA routinely misses, including deadlines to review air toxics standards and requirements that the EPA and states make decisions within one year on prevention of significant deterioration permit applications submitted under the new source review program.
“A lot of those deadlines are just unrealistic,” Holmstead said. “It just isn't feasible to get all of those done.”
Review Times Vary
When asked why the EPA consistently takes longer than five years to complete a NAAQS review, the agency cited numerous factors that play a role in the length of a reassessments, including the volume of new science that the EPA must consider.
For example, the current review of the ozone standards included more than 1,000 new studies that were published since the previous cycle concluded in 2008. The EPA has a court-ordered deadline of Oct. 1, 2015, to complete that review, which would be about seven-and-half years after the last review was completed in March 2008.
The EPA also said reviews for some criteria pollutants are more complex because there are multiple health effects associated with exposure, potentially with different at-risk populations that must be considered. Additionally, some pollutants have public welfare effects, which trigger an extensive review of the secondary standards, which are intended to protect against damage to crops and vegetation, decreased visibility and other welfare effects, the agency said.
Holmstead said the reviews, which include collecting new studies, formulating draft science assessments and other regulatory documents and soliciting input from the Clean Air Scientific Advisory Committee, are an “enormously time consuming” process for the agency.
“In order to meet the five-year deadline, they would essentially have to start the week after they have a new standard,” he said.
The EPA said it typically takes at least one year after a NAAQS review concludes to organize the new scientific evidence and formulate the policy questions that must be considered during the subsequent reassessment, though the agency noted that time frame varies. For example, the agency convened the science policy workshop for the 2012 review of the particulate matter standards nine months after the 2006 examination concluded, but did not convene a science policy workshop for the current, ongoing look at the lead standards until 17 months after the previous one concluded in 2008.
Sen. Flake Eyes Fix
In March, Flake reintroduced S. 640, the Ozone Regulatory Delay and Extension of Assessment Length Act (ORDEAL Act), a bill that would extend the five-year review deadline to 10 years. The bill also would delay the EPA's ongoing review of the ozone standards until Feb. 1, 2018, which would be 10 years after the standards were last revised (43 DEN A-23, 3/5/15).
“We believe 10 years would provide the agency a reasonable amount of flexibility with which to meets it requirements,” Flake told Bloomberg BNA in an e-mail. “Certainly the five-year review time frame is not working.”
The ORDEAL Act was previously introduced in 2014, but it didn't move before the Congress ended. A spokesman for Flake told Bloomberg BNA in an e-mail that given the likely economic effects of the EPA proposal to tighten the ozone standards, there will be “considerably more attention” on ozone as the court-ordered deadline for final action approaches.
Many industry groups that oppose the EPA proposal (RIN 2060-AP38) to revise the current standards of 75 parts per billion to somewhere in the range of 65 ppb to 70 ppb have voiced support for the ORDEAL Act as a way to both delay the ozone rule and address some of the broader issues with the way EPA sets its standards. Those groups also have voiced support for a bill (S. 751) from Sens. John Thune (R-S.D.) and Joe Manchin (D-W.Va.) that would bar the EPA from establishing more stringent ozone standards until 85 percent of the areas currently designated as being in nonattainment with the 2008 ozone standards come into compliance (52 DEN A-17, 3/18/15).
“I think all options have to be on the table,” Justin Prosser, director of government affairs at the National Mining Association, told Bloomberg BNA.
When asked about the possibility of using appropriations bills to introduce a rider that would delay the final ozone standards, Flake told Bloomberg BNA in an e-mail that he looks forward to Congress returning to regular order so the ozone issue could be put “front and center.”
Opponents Forecast Longer Delays
Opponents of the ORDEAL Act said the practical effect of extending the five-year review period to 10 years would be further delays by the EPA.
Given that it typically takes the EPA between eight and 13 years to complete a review with the five-year deadline, a 10 year deadline could mean that reviews take between 15 to 18 years, John Walke, clean air director for the Natural Resources Defense Council, said.
“There is zero reason to believe they [EPA] would meet statutory deadlines if they were 10 years,” Walke told Bloomberg BNA.
Eric Schaeffer, executive director of the Environmental Integrity Project, agreed that the EPA would not meet a 10-year review deadline if the Clean Air Act was amended. If the time frame was extended to 10 years, the EPA would likely take 15 or 20 years to complete its NAAQS reviews, Schaeffer told Bloomberg BNA.
Bill Becker, executive director of the National Association of Clean Air Agencies, told Bloomberg BNA that if industry actually wants a 10-year review cycle, they could keep the status quo and be confident it will take about that long for the EPA to complete its reviews.
“It's a very robust process and one that, absent a court order, has languished,” Becker said.
Becker said that while the Clean Air Act only requires the EPA to review the standards, delaying the reviews would be to industry's benefit because if the standards are changed, they would be strengthened, not relaxed. Therefore, delaying the reviews also would delay requirements that industries install pollution control equipment and take other steps to reduce emissions under a tighter standard, Becker said.
Citizen Lawsuits Criticized
The EPA's repeated failure to meet its five-year NAAQS review deadlines has often been met with lawsuits filed by environmental groups, including the Environmental Integrity Project and the NRDC, to compel the EPA to fulfill its nondiscretionary duty to complete them. Of the last 16 reviews, including the ongoing 2015 reexamination of the ozone standards, 15 were completed under a deadline brought about as result of a citizen lawsuit. Only the 1994 review of the carbon monoxide standards was completed outside of consent decree or court order, according to historical regulatory documents available on the EPA website.
Many lawmakers and industry groups are critical of the frequent lawsuits against the EPA, a strategy that they've dubbed “sue and settle.”
Holmstead said the Clean Air Act's numerous deadlines have given the environmental and public health groups the ability to set the agenda. Holmstead said those groups have delayed filing lawsuits over the missed deadlines for reviews of the carbon monoxide and lead standards in lieu of higher priority issues.
“Instead of having the EPA decide it is time to review a NAAQS, it is really up to the environmental community,” Holmstead said.
Flake, who mentioned the prevalence of deadline lawsuits when he reintroduced the ORDEAL Act, told Bloomberg BNA in an e-mail that any reductions in the frequency with which EPA priorities are set by court orders and “backroom “settlements would be a drastic improvement over the current situation.
The EPA, when asked whether citizen lawsuits affect how EPA focuses its resources, referenced a January report by the Government Accountability Office that concluded settlements in deadline lawsuits have a limited effect on EPA priorities (10 DEN A-15, 1/15/15).
No ‘Magic Number.’
When asked about their reasons for supporting the ORDEAL Act, several industry representatives said the five-year review cycle doesn't provide states and industries with enough time to implement a standard before it is potentially revised.
Bruce Watzman, senior vice president for regulatory affairs at the National Mining Association, was one of several industry officials who pointed out that the EPA in February issued final requirements for implementing the 2008 ozone standards, about seven years after the standards were set.
“That is illustrative of why the timeline for review needs to be expanded,” Watzman told Bloomberg BNA.
Watzman said he isn't sure if there is a “magic number” for how often the EPA should conduct its NAAQS reviews, but five years is not long enough for the ozone standards. The frequent reviews create uncertainty for the mining industry, which is very capital intensive, Watzman explained.
Watzman said mining companies make multi-million dollar investments in equipment that are not made for immediate return because a mining operation could be active for anywhere from 30 to 50 years. The possibility that the EPA could tighten its ozone standards makes it more difficult for companies to determine whether those investments will still be viable in the future or whether it is possible the investments could become stranded assets, he said.
Mike Walls, vice president for regulatory and technical affairs at the American Chemistry Council, told Bloomberg BNA that significant work needs to be done to implement the 2008 ozone standards.
“Our view is EPA should focus its resources on that, of attaining the health benefits from achieving the current standard, before we go lowering them,” Walls said.
Planning, Implementation More Complicated
Implementing the ozone standards and standards for other pollutants has become more difficult over time as the standards have been tightened, Bill Kovacs, senior vice president for environment, technology and regulatory affairs at the U.S. Chamber of Commerce, said.
Kovacs told Bloomberg BNA that after the Clean Air Act was enacted, it wasn't as financially disruptive to achieve the NAAQS because states and industry could target the “low-hanging fruit” of easy-to-achieve emissions. However, as the NAAQS grow tighter, the EPA is getting into levels where they cannot identify all the technology required to achieve the emissions reductions needed to meet those standards.
The cost-benefit analysis that accompanied the EPA proposal to revise the ozone standards acknowledged that some areas would need to use unknown controls to attain a revised standard.
Holmstead noted that the revision of a NAAQS is the start of a long implementation process that includes designating areas and the development of state implementation plans. Under the current process, by the time a state has an approved plan to implement, the five-year review cycle is up.
Becker said there are “challenges for some areas” when the EPA revises standards in the middle of the implementation process for the previous standards. However, he said every emissions reduction achieved under older standards also is helpful to comply with the revised, more stringent standards. The expected 2015 revision to the ozone standards does “move the goal post further back in the end zone,” but reductions achieved under the 2008 standards still get states closer to the new goal than they otherwise would be, Becker said.
Resources, Incremental Deadlines Suggested
Walke and Schaeffer both agreed that giving the EPA more time under the Clean Air Act to conduct its NAAQS reviews is not the right solution.
Walke said the best way to fix the process would be to give the EPA additional resources and for the administration in charge to have the political will to revise the ozone standards in a timely fashion.
“This standard-setting process is about delivering on the promise of safe air to all Americans,” Walke said. “It's just indefensible to pretend that we can only fulfill that promise on a 15 to 18 year cycle that would result from slowing the review process to every 10 years under the law.”
Schaeffer agreed that there is a resource issue at the EPA, given the cuts to the agency's funding in recent years. However, he suggested that the best solution to the EPA's constant failure to meet the five-year review cycle would be to find a way to “take the slack out” of the process.
Currently, environmental groups cannot file a lawsuit until the five-year deadline is passed, even if it is clear earlier that the agency won't meet the deadline, Schaeffer said. Once a lawsuit is filed, it takes years for citizen lawsuits to be heard and decided or settled, he said. Possible solutions could include a requirement that a proposed NAAQS revisions rule go into effect if the agency fails to make a final decision within the mandated time frame or the setting of legally enforceable interim targets to ensure the agency keeps moving toward completing the review, Schaeffer said.
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New York State Agency Releases Environmental Impact Statement on Fracking
May 14, 2015 | BNA Daily Environment Report
By Gerald B. Silverman
The New York State Department of Environmental Conservation (DEC) released its long-awaited environmental impact statement (EIS) May 13 on fracking, citing the potential health and environmental impacts of the natural gas drilling practice but not explicitly banning the practice.
The statement, after a 10-day notice period, will be followed by a formal “findings statement” from state Environmental Conservation Commissioner Joseph Martens.
Martens and the state health commissioner announced in December that fracking will be banned in New York state due to public health and environmental concerns (243 DEN A-2, 12/18/14).
The EIS includes hundreds of pages, some 28 different documents and responses to 260,000 public comments.
DEC spokesman Thomas Mailey told Bloomberg BNA that the final decision on whether to permit fracking will be contained in Marten's findings statement. He said he couldn't predict if the statement would contain an explicit fracking ban.
New York has had an effective moratorium in place on fracking for a number of years, and the state's highest court has ruled that local governments have authority to prohibit the practice.
Despite the December announcement from the administration of Gov. Andrew M. Cuomo (D), a number of the state's anti-fracking activists have been concerned about whether a true ban is really in place(52 DEN A-8, 3/18/15).
SGEIS Result of Extensive Examination
“The final SGEIS [Supplemental Generic Environmental Impact Statement] is the result of an extensive examination of high-volume hydraulic fracturing and its potential adverse impacts on critical resources such as drinking water, community character and wildlife habitat,” Martens said in a statement.
“We considered materials from numerous sources, including scientific studies, academic research and public comments, and evaluated the effectiveness of potential mitigation measures to protect New York's valuable natural resources and the health of residents,” Martens continued. “I will rely on the FSGEIS when I issue a Findings Statement in accordance with state law.”
Thomas S. West of the West Firm PLLC, an attorney for the oil and gas industry, told Bloomberg BNA that “it is a sad day in the history of New York State when politics trumps science and a ‘chicken little’ mentality becomes the basis for official regulatory pronouncements from the New York State Department of Environmental Conservation.”
Sees ‘Political Charade.'
“Ironically, issuance of the Final SGEIS comes the day after the United States House of Representatives passed the Regulatory Integrity Protection Act, H.R. 1732, which protects landowners from intrusive government and ensures the protection of personal property,” he said in an e-mail. “We look forward to the day when the mineral owners in New York State will be able to go into federal court to receive compensation for a takings of their mineral rights based upon this political charade.”
Environmental Advocates of New York applauded the EIS as a fracking ban. Liz Moran, EANY associate for water and natural resources, said “New Yorkers asked Gov. Cuomo to follow the science, and he did.”
“Hundreds of thousands of people took time out of their personal lives, educated themselves on the danger of fracking, and engaged with their government in a way we've haven't seen in years,” she said in a statement. “This is a really proud moment for every one of them because protecting public health triumphed over industry pressure.”
Landowners Group Cites ‘Unconscionable Assault.'
Dan Fitzsimmons, president of the Joint Landowners Coalition of New York, said the EIS “represents one more opportunity denied in Andrew Cuomo's unconscionable assault on Upstate New York.”
“Andrew Cuomo said his decision on hydraulic fracturing would be guided by science and facts,” Fitzsimmons said in a statement. “But, no matter what side of this debate you are on, everyone knows Cuomo's decision was solely based on his political future.”
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Murkowski Introduces Legislation To End Ban on U.S. Crude Oil Exports
May 14, 2015 | BNA Daily Environment Report
By Ari Natter
The 40-year-old ban on the export of domestic crude oil would be repealed under legislation unveiled May 12 by Senate Energy and Natural Resources Chairman Lisa Murkowski (R-Alaska).
The Energy Supply and Distribution Act of 2015 S. 1312, co-sponsored by Sen. Heidi Heitkamp (D-N.D.) and 11 Republican senators, would authorize exports of all crude oil and condensate produced in the U.S. without a federal license, according to a bill summary.
“America's energy landscape has changed dramatically since the export ban was put in place in the 1970s,” Murkowski said in a statement. “We have moved from energy scarcity to energy abundance. Unfortunately, our energy policies have not kept pace.”
Other Provisions
The legislation would also direct the Energy Department to create a standard definition of “condensate” and affirm a 2014 decision by the Commerce Department to treat processed condensate as a petroleum product, which may be exported without a license, the bill summary said. Other provisions in the bill would authorize a program requested by the Energy Information Administration to share data with Mexico and Canada on cross border energy flows and would authorize the departments of Energy and Interior to assess condensate separately from crude oil.
Lifting the trade prohibition, which was put in place in the wake of the Arab oil embargo, is supported by companies that include Hess Corp., Marathon Petroleum Corp. and ConocoPhillips, which argue it no longer makes sense amid record U.S. oil production.
“There are few policy changes that would bring more value to our domestic economy,” Louis Finkel, executive vice president of the American Petroleum Institute, said in a statement. “This bill will unlock America's energy potential and help U.S. energy production to stay competitive in a difficult market.”
Opponents include refiners such as Alon USA, Monroe Energy, PBF Energy and Philadelphia Energy Solutions, which are concerned that changing the law could increase domestic oil prices, decreasing their profits.
The bill, as well as House legislation (H.R. 702) introduced by Rep. Joe Barton (R-Texas), faces an uphill battle as lawmakers remain concerned that approving the change could later be linked to an increase in gasoline prices.
Passage in 2017?
“We still do not expect legislative crude export reforms to succeed during the current Congress, but strong, bipartisan committee support for [S. 1312] could inspire House legislative efforts and pave a pathway towards a lifting of the ban in 2017,” Clearview Energy Partners said in a May 13 research note. “By the same token, a failed Committee vote could potentially freeze crude export debate for months or years.”
Republican co-sponsors of the bill are Sens. John Hoeven (N.D.), John Barrasso (Wyo.), John McCain (Ariz.), Bob Corker (Tenn.), Lamar Alexander (Tenn.), Jim Risch (Idaho), Jeff Flake (Ariz.), Shelley Moore Capito (W.Va.), Jim Inhofe (Okla.), Marco Rubio (Fla.) and Jim Lankford (Okla.).
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House Pipeline Legislation Would Slow Projects Down, FERC Official Testifies
May 14, 2015 | BNA Daily Environment Report
By Ari Natter
House legislation designed to speed the federal approval process for new natural gas pipelines would have the unintended consequence of slowing projects down, a senior Federal Energy Regulatory Commission official testified May 13.
Ann Miles, director of the Office of Energy Projects at FERC, said the House Energy and Commerce Committee's draft bill would lengthen processing time by codifying existing “successful practices” later in the application review process for interstate natural gas pipelines.
“I am concerned that codifying the Commission's practices too rigidly might have the unintended consequence of limiting the Commission's ability to respond to the circumstances of specific cases, to changes in the natural gas industry, or to the nation's energy needs,” Miles told the Subcommittee on Energy and Power.
Bill Would Set Deadlines
The draft bill, unveiled May 7, would require FERC to identify all agencies considering an aspect of an application and set the schedule for review, including a deadline for a final decision, and would require federal agencies to complete the permit process within 90 days after issuance of the Commission's final environmental document, according to a bill summary.
“The current siting process for natural gas facilities has resulted in a significant increase in the natural gas infrastructure in the United States, meeting the nation's energy needs and answering the concerns of all stakeholders with decisions that are fair, thorough and legally defensible,” Miles said.
The bill, which is expected to be a component of broader energy legislation the committee is developing, received support from Maine Gov. Paul R. LePage (R), who said bottlenecks in the natural gas transportation system led prices to skyrocket from $3 per million British Thermal Units (MMBtu) to nearly $20 per MMBtu during New England's winter in 2014.
Industry Wants More
“The people of New England want these projects done, but bureaucracy is preventing timely action,” LePage testified. “Bureaucracy has hijacked democracy.”
Donald F. Santa, president and chief executive officer of the Interstate Natural Gas Association of America, said the bill “would modestly improve the permitting process,” but said more should be done.
“We support these steps, but continue to urge Congress to create real consequences for agencies that fail to meet reasonable deadlines,” Santa said in his written testimony. “The intent that motivates the draft bill—that is, better coordination to ensure that federal and state permitting agencies thoroughly review and act on pipeline applications on a timely basis—will not be accomplished absent real consequences for agencies that fail to act.”
The organization represents interstate natural gas transmission pipeline operators in the U.S. and Canada including Cheniere Energy Inc., and the Enbridge Energy Co.
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Official Warns Pipeline Expediting Bill Could In Fact Slow Permitting
May 14, 2015 | E&E Daily News
By Nick Juliano
A draft bill meant to streamline natural gas permitting would codify some existing practices at the Federal Energy Regulatory Commission to improve the process but could also lead to unintended consequences by delaying interagency consultations and related activities, a senior FERC staffer told a House panel yesterday.
The House Energy and Commerce Subcommittee on Energy and Power was considering a draft pipeline bill that would be included in comprehensive energy legislation committee leaders are crafting this year.
Among other provisions, the bill would set a 90-day deadline for agencies to sign off on pipeline permits after FERC completes its National Environmental Policy Act review, though it does not mandate automatic approval if agencies miss that deadline, as would have been the case under an earlier bill that ran into a White House veto threat earlier this year (E&E Daily, May 11).
Republicans say the bill is needed to support the demand for natural gas pipelines that followed the dramatic growth in supply from the hydraulic fracturing revolution and to ensure adequate supply for natural-gas-fired power plants expected to come online to replace retiring coal-fired units. Democrats generally resisted the bill, saying it would give too much control to FERC and could subvert other agencies' mandates to protect public health or the environment. Furthermore, Democrats warned, setting deadlines on agency reviews could lead to applications being denied, when with additional time they could have been modified to win approval.
Ann Miles, director of FERC's office of energy projects, said she supported the goal of making pipeline reviews as quick and efficient as possible. But she defended the commission's current record, pointing out that more than 90 percent of applications are approved within one year, a time frame she said was reasonable.
Furthermore, she said, the draft bill would risk actually slowing reviews by reducing the amount of work currently undertaken during a "pre-filing" process -- before companies formally file applications to license pipelines -- in which FERC coordinates with project applicants, other stakeholders and agencies to identify issues that could delay approval. Miles was testifying on her own behalf, and she said her opinions did not constitute the official position of FERC or any individual commissioners.
"The proposed text would codify existing, successful practices but, in doing so, would move some processes later in the application review, which could have the unintended consequences of lengthening the processing time for natural gas facilities," she told the panel. "I am concerned that codifying the commission's practices too rigidly might have the unintended consequence of limiting the commission's ability to respond to the circumstances of specific cases, to changes in the natural gas industry, or to the nation's energy needs."
Maine Gov. Paul LePage, a Republican who rode the tea party wave of 2010 into office and was re-elected last year, pleaded with the subcommittee members to speed pipeline development. He said Maine's intrastate pipeline network has expanded dramatically but that utility customers in the state still were seeing their energy bills rise because of delays in getting interstate connections approved.
"We need infrastructure; we plead with you," LePage said. "The people of New England want these projects done, but bureaucracy is preventing timely action."
Several Democrats pointed to FERC's record of approving more than 90 percent of its pipelines within a year. If reviews take longer, they argued, it is generally because the projects raise unique environmental concerns or would cross sensitive landscapes.
"In fact, some of my constituents would probably want more time to participate in this process," Rep. Paul Tonko (D-N.Y.) noted during the hearing.
Democrats and an environmentalist witness on the second panel also took issue with the bill's call for other agencies to generally defer to FERC to set the scope of permitting reviews, arguing that doing so would subvert priorities such as endangered species protection, climate change or water quality.
"They look at different issues; that's why they're different agencies and they have different mandates," said Carolyn Elefant, a member of the board of the Pipeline Safety Coalition and lawyer in her own practice.
Rep. Gene Green (D-Texas), who voted against H.R. 161, the previous pipeline bill, seemed more receptive to yesterday's draft. Although he did not offer an explicit endorsement during the hearing, Green said he could "understand the frustration" LePage had with supply constraints in Maine, and noted that he represented a gas-producing state always eager to find new customers.
While the gas pipeline bill captured most of the attention yesterday, the hearing agenda also featured a draft hydropower bill to expedite construction of small power projects on existing dams, extend licenses under certain circumstances and implement additional reforms. It is based on an earlier bill from Rep. Cathy McMorris Rodgers (R-Wash.), chairwoman of the House Republican Conference, the fourth-ranking leadership post (E&ENews PM, April 24).
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Drilling to Resume Near Site of Gulf Oil Spill
May 13, 2015 | The Hill - E2 Wire
By Timothy Cama
Offshore oil and natural gas drilling is set to resume in June in the area of the Gulf of Mexico where the 2010 Deepwater Horizon explosion and oil spill occurred.
LLOG Exploration Offshore, an oil company based in Louisiana, obtained approval last month from the Bureau of Safety and Environmental Enforcement to drill in the Macondo prospect, The Associated Press reported.While the oil reservoir is the same, the company says there is little connection to the BP disaster that killed 11 workers and spilled oil into the Gulf for 87 days in the worst environmental catastrophe in recent United States history.
“Our commitment is to not allow such an event to occur again,” Rick Fowler, the vice president for deep-water projects at LLOG, told AP. “LLOG staff keeps the memory of what happened ... fresh in our minds throughout our operations, both planning and execution.”
It would be the first drilling in the Macondo prospect since the BP spill, according to the Bureau of Ocean Energy Management, which also approved LLOG’s plans.
Richard Charter, senior fellow with the Ocean Foundation, told the AP that he is worried a small company like LLOG might not have the resources available to respond to a disaster.
But Eric Smith, a professor at Tulane University, defended LLOG, calling it a well-established company.
“If I were to pick anyone to go into that field after so many problems, I would pick LLOG,” he told the AP. “They have demonstrated their ability to drill in the area.”
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N.M. Democrats Concerned Over Drilling Near Tribal Site
May 14, 2015 | E&E Daily News
By Phil Taylor
Sen. Tom Udall (D-N.M.) yesterday asked Bureau of Land Management Director Neil Kornze to take a closer look at oil and gas leasing near Chaco Canyon in northwest New Mexico, calling the area a rich cultural destination with sacred value to tribes.
"It appears that many new leases are getting closer to the Chaco Culture National Historic Park, which really concerns me," Udall told Kornze at a budget hearing of the Senate Interior, Environment and Related Agencies Appropriations Subcommittee.
He was echoing the concerns of environmental groups that have sued to block development.
Udall, along with Sen. Martin Heinrich (D-N.M.) and Rep. Ben Ray Lujan (D-N.M.), on Tuesday sent a letter to Interior Secretary Sally Jewell requesting that she "actively participate in a dialogue" with constituents who oppose oil and gas development near Chaco.
"Many of our constituents are concerned about the potential impacts that oil and gas development could have on the archaeological sites associated with the ancient Chaco people," the letter said. "Federal leasing activities should adequately take into consideration the important cultural, historical and ecological value of the area, which also benefits local tourism, along with the immediate economic impacts of development."
The lawmakers asked Jewell to send "high-level" department officials to New Mexico to hear from constituents.
Environmental groups this week asked a federal judge to temporarily block BLM from issuing drilling permits that they argued threaten tribal artifacts in the Chaco region (Greenwire, May 12).
The motion is part of a federal lawsuit the groups -- WildEarth Guardians, the Natural Resources Defense Council, the San Juan Citizens Alliance and Diné Citizens Against Ruining Our Environment -- filed two months ago challenging BLM's drilling approvals in the region.
The area in question is undergoing a boom in shale drilling. BLM is working to update its resource management plan in the Farmington field office in northwest New Mexico, in part to update assessments of how oil and gas development will affect the region's air quality, roadless lands and water supplies, among other resources.
Industry hopes advances in horizontal drilling and hydraulic fracturing will unleash a production boom similar to those in the Bakken Shale in North Dakota and Montana, the Eagle Ford Shale in Texas, and the Permian Basin in eastern New Mexico and West Texas. Roughly 90 percent of the lands in the Farmington field office are already under lease.
Udall yesterday also criticized BLM's proposal to merge its Arizona and New Mexico state offices, a move BLM has argued is being contemplated to gain efficiencies and improve BLM's capacity to respond to the public.
"I am very skeptical of this idea," Udall said. "Having a state director in New Mexico focused on New Mexico's many unique public lands issues has served us well for decades."
More than a dozen other Western representatives, mostly Republicans, last week sent a letter to Kornze also opposing the plan (E&E Daily, May 7).
Kornze yesterday told Udall that BLM has weathered a 12 percent reduction in employees over the last five years and that the merger is being explored as a way to keep more staff at the field level serving constituents.
He emphasized that no final decisions have been made.
"Your priority is also my priority in making sure we have the best customer service," Kornze said. BLM is under orders from Congress to maximize its efficiency, and improving its management structure is one such tool to do that, he said.
"I think a lot more conversation should take place," Kornze said. "I appreciate you keeping an open mind on it."
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Kayakers Prepare to Meet Shell's Oil Drill Rig in Seattle
May 14, 2015 | AP (in The New York Times)
Protesters opposed to Arctic oil drilling are preparing to paddle out in kayaks to meet Shell's massive offshore drilling rig as it arrives any day now in Seattle, raising the stakes in the battle over oil exploration in the remote Arctic Ocean.
The petroleum giant says it is moving ahead with plans to use leased space at the Port of Seattle to load its drilling rigs and other vessels with supplies and personnel as it prepares to explore for oil this summer in the Chukchi Sea off Alaska's northwest coast.
That's despite the city saying the Port of Seattle needs a new permit before it can host Shell's Arctic drilling fleet and the city warning that the port and Foss Maritime, a local company that's working with Shell, could potentially face fines for unpermitted activity.
One of the drill rigs it plans to use — the 400-foot long Polar Pioneer — has been parked at Port Angeles on the Olympic Peninsula, and is expected in Seattle this week.
John Sellers, 48, who works with an advocacy group on economic justice issues, paddled out to meet the Polar Pioneer when it arrived in Port Angeles and now hopes to do the same when it arrives in Seattle's Elliott Bay.
"It's the perfect tactic to paddle out and meet the rigs on the water," he said. "The rigs are on the water, that's where they do their business, that's where they're doing their damage."
He said he wants to push for change toward a clean-energy future that moves away from fossil fuels.
Environmentalists are planning a three-day so-called "festival of resistance" starting Saturday. Smaller groups of experienced kayakers have also been training to confront the rigs when they arrive in Elliott Bay, though many said they plan to observe safety zones that the Coast Guard has set up around the ships.
"There's a sense of gravitas around this moment," said Bill Moyer, who has been helping train protesters in paddling techniques and kayak safety for the demonstration scheduled for Saturday dubbed the "Paddle in Seattle."
"It's hard to see where normal people can have an impact on something as vast and seemingly distant as climate and the Arctic," said Moyer, executive director of the Backbone Campaign.
"So this moment is historic opportunity for regular people to demonstrate their desire for a pivot away from fossil fuels," he said of Saturday's protest.
Shell's drilling program cleared a major bureaucratic hurdle Monday when the federal Bureau of Ocean Energy Management approved its multi-year exploration plan in the Chukchi Sea. The company must still obtain other permits from state and federal agencies, including one to drill from the Bureau of Safety and Environmental Enforcement.
But Shell spokesman Curtis Smith has said the approval "is an important milestone and signals the confidence regulators have in our plan."
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EPA to Hold Public Listening Session On Pretreatment Rule for Oil, Gas Operations
May 14, 2015 | BNA Daily Environment Report
By Amena H. Saiyid
Proposed federal technical standards for wastewater effluent from shale gas and oil wells and other unconventional oil and gas wells will be the focus of a public listening session scheduled for May 29, an Environmental Protection Agency official said May 13.
The EPA meeting will enable the agency to gather more comment on the proposed pretreatment standard that is intended to protect wastewater utilities from pollutants that can pass through or interfere with the treatment process, Jan Matuszko, chief of EPA Office of Wastewater Management's engineering and analytical support branch, said. She spoke at the National Pretreatment & Pollution Prevention Workshop, sponsored by the National Association of Clean Water Agencies, in Greenville, S.C.
The effluents of concern to the EPA can include hydraulic fracturing chemicals and naturally occurring minerals that have risen to the surface along with oil or water.
Matuszko said the final rule will be issued in the summer of 2016.
EPA Administrator Gina McCarthy signed the proposed rule (RIN 2040-AF35) March 31 (62 DEN A-17, 4/1/15).
The public listening session is scheduled for 1 p.m. at the agency's headquarters, located in the William J. Clinton East Building, Room 1153, 1201 Constitution Avenue N.W., Washington, D.C.
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Colorado Wellbore Complaints, Tests Data Available
May 14, 2015 | BNA Daily Environment Report
The Colorado Oil and Gas Conservation Commission now is providing information related to public complaints and mechanical tests for drilling wellbores in bulk download form. The commission said May 12 the information is part of its efforts to make more of its data available to the public in different formats. Matt Lepore, director of the COGCC, said releasing data in bulk download format also is designed to help resolve the difficulty of aggregating a large amount of data on a specific topic. A guide to COGCC data is available at http://cogcc.state.co.us/documents/data/downloads/COGCC_Download_Guidance.pdf.
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Red Tape Ties Up Energy on Federal Lands, Murkowski Says During Hearing on BLM
May 14, 2015 | BNA Daily Environment Report
By Alan Kovski
Federal policies affecting energy development on public lands were raked over the coals and defended during a May 13 Senate hearing as Sen. Lisa Murkowski (R-Alaska) critiqued various decisions of the Bureau of Land Management.
It's easy to find oil and natural gas companies that are ready, willing and able to buy and develop leases, but they can move to production so much more quickly on state and private lands that they will look for every opportunity to work anywhere except federal lands, Murkowski said.
“They tell me their biggest obstacle is our federal government,” Murkowski said during a hearing of the Senate Appropriations Subcommittee on Interior, Environment and Related Agencies.
BLM Director Neil Kornze said he understood the objections, but he said his agency's speed has been improving, and he argued that companies aren't taking as much advantage as they could of the permits they already have.
There are 6,000 permits to drill currently outstanding that could be put to use, Kornze testified. The average number of wells drilled on federal and Indian lands annually under BLM authority is about 3,000, so the 6,000 permits are enough for two years of work, he said.
Setting Stage for Changes
Murkowski and Kornze have been over this ground several times this year and last year. The senator has been laying the groundwork for a wide-ranging package of energy legislation this year or next year, with recently introduced bills serving as possible candidates for inclusion(90 DEN A-6, 5/11/15).
The National Petroleum Reserve-Alaska, a part of Alaska estimated to be rich in oil, still has no oil production and is “a perfect case in point” for illustrating the problem of bureaucratic red tape, Murkowski said.
ConocoPhillips Co. has been trying for years to start production in the NPR-A. The company's lead project there, Greater Mooses Tooth 1, appeared earlier this year to have a good chance of starting oil production in the NPR-A soon, but that project has stalled again, Murkowski said.
Different Metering System Required
She said the BLM came up with an added requirement for a different metering system to measure oil production rather than the standard system used for decades in Alaska.
Kornze said the metering requirement was to minimize the error rate in measuring the oil volumes. The standard system had an error rate of 4 percent to 10 percent, not adequate to assure that American taxpayers would receive accurate royalty payments.
“Right now the American taxpayer's getting 100 percent of nothing,” Murkowski responded.
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Nobody Trusts Barack Obama on Energy
May 13, 2015 | National Journal
By Clare Foran and Ben Geman
On top of that, Obama still hasn't made a final decision on the Keystone XL pipeline, which has become the symbol of the national debate over climate change and American energy security. The administration's silence on the pipeline has both sides on edge.
The White House points to Shell's advance into the Arctic as evidence of the president's all-of-the above energy strategy, and emphasizes that new federal safeguards should ensure that drilling is done safely and responsibly.
"The president is committed to ensuring that we are doing as much as we can to protect our energy security, and that means looking for opportunities to safely develop sources of energy on American soil," White House press secretary Josh Earnest told reporters Tuesday.
In February, the Interior Department unveiled a slate of safety standards designed to prevent and contain oil spills in remote Arctic waters, including requirements that companies have quick access to equipment to contain a potential blowout and have a rig available to drill a "relief well"—a second well that could halt the flow of oil from a blowout.
But all that has done little to calm fears from environmentalists that Arctic drilling will be a disaster.
Drilling in Arctic waters is no easy task. Freezing temperatures, choppy waters, and remote locations increase the odds of an accident. And green groups are quick to point out that the Interior Department itself has acknowledged the risk of a major oil spill if existing leases are developed in the Arctic's Chukchi Sea.
As a result, green groups are infuriated. Environmentalists don't trust that safeguards put in place to protect the environment will suffice, and they view the decision as a step in entirely the wrong direction as they work to pressure the administration to continue tackling climate change before Obama's term in office ends.
"We think the administration is dead wrong on this," said Ben Schreiber, Friends of the Earth's climate and energy program director.
"Arctic drilling is just a terrible, terrible idea," said Elijah Zarlin, a senior campaigner for CREDO Action. "This is a president that has already presided over the greatest oil spill in history, and now it seems like he's trying to break his own record. It certainly is becoming harder and harder to believe that the president is going to live up to his commitments."
And Obama's Arctic drilling go-ahead won't earn the administration any more breathing room in Congress as long as Republicans run the show. The president's critics are concerned that he'll restrict Arctic offshore development in other ways. For instance, Interior's plans call for selling Arctic leases next year and in 2017, but an aide to Murkowski expressed skepticism about whether those auctions will proceed.
"I'm not going to take my foot off the pedal," Murkowski said. "I think it's important for people to understand what resources we have, and yet what oftentimes we're held back from accessing."
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Obama Picks Former Regional Chief As Agency's Head Of Admin
May 14, 2015 | E&E Daily News
By Kevin Bogardus
Karl Brooks has been selected by President Obama for a top slot at U.S. EPA.
Among a slate of picks the White House announced yesterday, Obama noted his intent to nominate the former chief of EPA's Region 7 to be the agency's assistant administrator for administration and resources management. Brooks is currently the deputy administrator for that office, which manages EPA's support functions, such as human resources, contracts and grants.
"The talent and expertise these individuals bring to their roles will serve our nation well. I am grateful for their service, and look forward to working with them," Obama said in a statement.
Brooks has held the No. 2 spot in the office since February 2015. Before that, he was the Region 7 administrator, a position he held from 2010 to 2015. The regional headquarters are in Lenexa, Kan., where Brooks had to contend with farmer's complaints about EPA's rules and regulations (Greenwire, Sept. 22, 2014).
Brooks has a long history in academia, environmentalism, as well as business, law and politics.
He is a former University of Kansas professor, holding that job from 2000 to 2010, as well as working executive and legislative director for the Idaho Conservation League from 1993 to 1996. Brooks also served in the Idaho Senate and was an associate attorney for Holland & Hart from 1990 to 1993 and associate general counsel for Boise Cascade Corp. from 1983 to 1990.
He received a bachelor's degress from Yale University, a master's degree from the London School of Economics, a juris doctor degree from Harvard Law School and a doctorate from the University of Kansas, according to the White House.
Brooks' confirmation is far from certain. The Senate doesn't look likely to move on the president nominees for the agency any time soon (Greenwire, March 24).
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Senate Unveils Bill to Immediately Kill Clean Power Plan, Set Strict Limits on New Rules
May 14, 2015 | BNA Daily Environment Report
By Anthony Adragna
Sen. Shelley Moore Capito (R-W.Va.) unveiled legislation May 13 that would immediately scuttle the Environmental Protection Agency's carbon pollution regulations for the nation's fleet of power plants and set strict standards for the agency to meet if it pursues new rules.
The Affordable Reliable Energy Now Act (no number assigned) has 26 co-sponsors, including Senate Majority Leader Mitch McConnell (R-Ky.) and Senate Environment and Public Works Committee Chairman James Inhofe (R-Okla.).
It currently boasts one Democratic co-sponsor, Sen. Joe Manchin (W.Va.), though Manchin and other senators told reporters they were confident other Democrats would eventually support the legislation.
An aide to Capito told reporters the legislation was a “starting point” for the chamber and said the West Virginia Republican was willing to consider changes to attract additional Democratic support for the bill.
Capito's bill marks the first major effort in the Republican-controlled Senate to go after the rules at the heart of President Barack Obama's agenda to address climate change. The EPA proposed carbon dioxide emissions standards for the nation's fleet of new and existing power plants separately in 2014.
“This is going to go down as probably the most significant thing we will do in the Environment and Public Works Committee this year,” Inhofe said at a press conference. “We're going to make this a reality.”
House Considering Opt-Out Bill
Capito's bill introduction comes as the House prepares to consider the Ratepayer Protection Act (H.R. 2042), which would allow states the ability to opt-out of the existing plant regulations and delay compliance until the end of all litigation on the rule.
The Senate version goes significantly farther by immediately killing the rulemakings in-progress and addressing carbon pollution regulation of new power plants (83 DEN A-5, 4/30/15).
Aides said the Senate supports Rep. Ed Whitfield's (R-Ky.) House bill and worked closely with the other chamber on crafting the legislation but wanted to go further in setting stricter requirements for the EPA to meet in regulating power plants.
Senate Also Allows Opt-Out
Under the Senate bill, states could opt-out of any future regulations for existing power plants until all legal challenges are exhausted or if the governor certifies implementing the rule would have a negative impact on the state's economy, grid reliability or low-income residents. Those provisions are similar to the Whitfield bill.
In order to regulate emissions from existing power plants, the EPA also would have to issue 50 state-specific model plans for how individual jurisdictions could meet their targets, provide Congress with a report outlining quantities of expected greenhouse gas reductions compared to global emissions and conduct modeling outlining the expected impact of the rule on climate change indicators.
Capito's bill also would bar new regulations for future power plants unless the emissions standards had been met by six units at different electric generating stations for at least a year.
Any future rules also would have to set separate standards for coal and natural gas. Those provisions resemble ones from legislation championed by Whitfield and Manchin in 2014.
Clean Air Act Addressed
The legislation also would codify aspects of legal challenges to the proposed EPA regulations. It would, for example, add a new explicit prohibition to the Clean Air Act barring the EPA from regulating emissions under Section 111(d) if they had already been regulated under Section 112.
Another provision in the legislation would clarify that the federal government couldn't withhold highway funding if a state opts not to comply with any carbon pollution regulation. EPA Administrator Gina McCarthy has said there are no plans to do that.
Capito's bill would immediately repeal proposed regulations for new and existing power plants and treat them “as though the rules had never been issued.”
Among the rules specifically killed would be the agency's proposed limits (RIN 2060–AQ91) for new power plants (79 Fed. Reg. 1430), which would effectively limit emissions for new gas-fired units to 1,000 pounds of carbon dioxide per megawatt hour and set a limit of 1,100 pounds of carbon dioxide per megawatt hour for new coal-fired power plants (05 DEN A-4, 1/8/14).
That proposed regulation effectively would require the use of carbon capture systems to meet those standards.
Clean Power Plan Would be Quashed
Also immediately quashed in the bill is the proposed (RIN 2060-AR33) Clean Power Plan (79 Fed. Reg. 34,960). Issued under Section 111(d) of the Clean Air Act, the plan would establish unique carbon dioxide emissions rates for the power sector in each state (106 DEN A-1, 6/3/14).
States would be required to meet interim targets between 2020 and 2029, with a final emissions rate to be achieved in 2030, but would have flexibility to determine how best to achieve that target.
There would be no mandatory requirement under the bill for the EPA to develop new carbon emissions rules, an aide to Capito said.
In a statement issued coinciding with the bill's release, the EPA pushed back against concerns from the senators that the Clean Power Plan would harm economic growth, cost jobs and harm grid reliability.
EPA Says Plan ‘Will be Affordable.'
“The plan will be affordable, will drive innovation and American jobs, and will demonstrate our leadership in the international community,” Liz Purchia, an EPA spokeswoman, said. “In the EPA's nearly 45-year history, emissions from power plant pollution have decreased dramatically, improving public health protection for all Americans, while the economy has grown. EPA's plan will not change that.”
The statement didn't specifically address the Capito bill.
Environmental groups, including the Natural Resources Defense Council, the League of Conservation Voters and the Sierra Club, slammed the bill and said it would eviscerate the Clean Air Act.
“It's no surprise that the fossil fuel industry's foot soldiers in the Republican Senate are pushing this extreme attack, but any legislator who puts the health and safety of American families before big polluter interests will stay miles away from this bill,” John Coequyt, director of federal climate programs with the Sierra Club, said in a statement.
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Virginia Ponders Joining RGGI as State Weighs How to Meet Clean Power Plan Goals
May 14, 2015 | BNA Daily Environment Report
By Jeff Day
Virginia is considering joining the nine-state Regional Greenhouse Gas Initiative as one of several means of meeting the carbon dioxide reduction goals of the Environmental Protection Agency's proposed Clean Power Plan, a state Department of Environmental Quality spokesman said.
Michael Dowd, director of DEQ's air division, believes that the state will be unable to bring utility-scale wind or solar power on line by 2020, when the Environmental Protection Agency expects the state to have reduced power plant carbon emissions by 20 percent, DEQ spokesman Bill Hayden told Bloomberg BNA May 13.
Dowd believes Virginia will likely rely on electricity conservation and a greater share of electricity coming from natural gas-fired power stations over the next five years, although DEQ hasn't ruled out joining RGGI or other possibilities, Hayden said.
On the possibility of Virginia joining RGGI, the Boston-based Acadia Center recently estimated that if the state did so, it would earn more than $2.8 billion over the next 15 years, at least partly through allowance auctions. However, all pro-RGGI bills and resolutions introduced in the 2015 session of the Virginia Legislature were defeated(68 DEN A-12, 4/9/15).
New Energy Conservation Goal
Meanwhile, Virginia Gov. Terry McAuliffe (D) May 11 set a goal of reducing electricity use in Virginia's residential, retail and commercial sectors to 10 percent below 2006 levels by 2020. The governor's goal is similar to one established in 2007 by then-Gov. Tim Kaine (D). He called for a 10 percent reduction by 2022.
To help achieve the 2020 goal, McAuliffe announced the creation of the Governor's Executive Committee on Energy Efficiency.
The 12-member panel is charged with developing a way to measure energy consumption in the three sectors and identifying market, regulatory and policy barriers to and opportunities for reducing electricity consumption.
The Chesapeake Climate Action Network praised McAuliffe's decision. It's a “win-win step forward for Virginia's environment and economy,” CCAN Virginia Policy Director Dawone Robinson said in a news release.
Robinson said Virginia ranks “toward the bottom” of the states in terms of reducing energy use, citing American Council for an Energy Efficient Economy data. The council's 2014 report card lists Virginia at 35th.
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Groups Recommend Changes in RGGI To Comply With EPA's Clean Power Plan
May 14, 2015 | BNA Daily Environment Report
By Gerald B. Silverman
States in the Regional Greenhouse Gas Initiative should take three key steps to comply with the federal Clean Power Plan, including extending RGGI's cap by 10 years, changing the trajectory of scheduled cap reductions and revising the program's cost containment reserve, according to a May 13 report from environmental groups in the Northeast.
The report, which was released by the Acadia Center, said the three changes should be made during RGGI's scheduled program review in 2016. The changes would allow RGGI states to comply with the Clean Power Plan (CPP) being developed by the Environmental Protection Agency, while also strengthening the program, it said.
The report also recommended that RGGI develop “a streamlined pathway to expedite participation for new member states.”
The report, “RGGI Reform Principles: Program Revisions to Increase Environmental and Economic Benefits,” was supported by 32 environmental and clean energy organizations, including several groups from the nine-state RGGI region, the Union of Concerned Scientists and the Natural Resources Defense Council.
RGGI, which is a cap-and-trade program for carbon dioxide emissions from power plants in nine Northeastern and mid-Atlantic states, is scheduled to undertake a periodic review of the program in 2016, much like the one undertaken in 2012 that led to major changes.
“Open engagement with stakeholders and regular program review have been central to our effectiveness so far, and will likewise be important to our 2016 review and continued success for the program,” Kelly Speakes-Backman, the RGGI chairwoman, told Bloomberg BNA in an e-mail. “We'll consider these suggestions carefully along with input from all our stakeholders, and guidance from the final Clean Power Plan once it comes out this summer.”
Waiting for Final Power Plan
Matthew Schwall, a spokesman for the Independent Power Producers of New York, told Bloomberg BNA that “there is no sense in proposing revisions to RGGI before” the EPA finalizes its Clean Power Plan.
“At that time, contemplating revisions to RGGI might be appropriate,” he said in an e-mail. “What is abundantly clear though is that New York's power sector must receive full credit for reducing CO2 emissions by 41 percent since 2005.”
While no new states have publicly indicated their intention to join RGGI, the report said RGGI should take measures “to facilitate swift adoption” by any states that decide to join. The nine states currently participating in RGGI are Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New York, Rhode Island and Vermont.
“It is critical that allowance budgets and other provisions for new states entering the program be determined such that strong program design and rigorous environmental outcomes are maintained for the RGGI program as a whole,” the report said.
“One way to achieve this goal would be to determine new state allowance budgets just as the RGGI states determined the current RGGI cap: using 2012 emissions levels to determine a 2014 budget, and declining each year from 2014 until the first year of participation for a new state,” the report said. “This will ensure that the program's overall stringency is maintained and that CPP targets are met or exceeded.”
Recommendations Made
The report recommended that RGGI be extended until 2030 to comply with the Clean Power Plan and to provide greater certainty to the clean energy market. The RGGI program is currently scheduled to expire in 2020.
The report also recommended that RGGI change the “trajectory” of scheduled tightening of the cap on carbon dioxide emissions. The overall cap is currently scheduled to be reduced by 2.5 percent per year, based on the prior year's cap. The report calls for a “fixed quantity approach” such as one based on a single baseline year.
“Unless states correct the cap trajectory, they will be allowing four times as much climate pollution (CO2 emissions) in 2050 as they would under the more universally accepted fixed quantity approach,” the report said.
The report also recommended that RGGI modify provisions regarding the cost containment reserve (CCR), a mechanism that kicks in if carbon dioxide allowance prices rise above a certain level. RGGI currently adds the cost containment reserve allowances to its overall emissions budget, effectively raising its emissions cap.
The report recommended that the cost containment reserve allowances be borrowed from the existing budget, similar to the mechanism used in California. “This would ensure that aggregate emissions limits are not exceeded, while preserving the mechanism to mitigate volatility,” the report said.
‘Nothing Magical' to Fixed Increment
William M. Shobe, director of the Center for Economic & Policy Studies at the University of Virginia, told Bloomberg BNA that a lower emissions cap is reasonable, “but there is nothing magical about a fixed increment reduction relative to a percentage reduction.”
“In fact, for a given future emission target, say 2030, a percentage reduction schedule requires earlier reductions, and hence fewer aggregate emissions,” Shobe said in an e-mail. “It is simply not the case that fixed increment reductions are better. It is the setting of the ultimate reduction target that matters.”
“There is little reason to believe that any reduction path we choose today will last all the way to 2050,” said Shobe, who helped with the original design of the RGGI program. “There is every likelihood that RGGI will make adjustments based on what other states do, on new data on costs of reduction within RGGI and on new information about the risks from global warming.”
Shobe also disagreed with the report's recommendation for changing the cost containment reserve. He said it is “very unlikely” the reserve would be exhausted every year, which is assumed by the Acadia report. “If that were to occur,” he said, “then there would be a need to revisit the setting of the cap or of the CCR price triggers in order to ensure compliance with the reductions required under the CPP.”
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W.Va. Senators Launch Assault On EPA Carbon Rules
May 13, 2015 | E&E News PM
By Jean Chemnick
West Virginia's two senators took the lead today in launching their chamber's flagship bid to kill U.S. EPA's proposed rules for carbon emissions from new and existing power plants, pledging the bill would move quickly through committee.
Sen. Shelley Moore Capito (R) sponsored the measure, which heavily borrowed from a bill that co-sponsor and Mountain State colleague Sen. Joe Manchin (D) floated in the last Congress. http://www.capito.senate.gov/sites/default/files/ARENA%20Act_Bill%20Text.pdf
Senate Environment and Public Works Chairman James Inhofe (R-Okla.) promised at a Capitol press conference unveiling the bill today that he would prioritize it.
"This is going down as probably the most significant thing that we would do in the Environment and Public Works Committee this year," he said.
The bill takes aim at two EPA rules that form the core of Obama's second-term climate agenda. It is unclear what effect it would have on the agency's separate rule for modified sources, which is more modest. All three measures are set to be finalized this summer, and Capito said her measure was timed "to front-run that."
Like Manchin's bill from the last Congress, it would scrap EPA's proposed rule requiring all new coal-fired units to use carbon capture and storage (CCS) technology to limit emissions. It would direct EPA to limit any subsequent standard to technology that is already in use in at least six power plants in the same technology category -- in the case of new coal, that would likely mean supercritical technology.
Manchin's bill in the last Congress with Rep. Ed Whitfield (R-Ky.) would also have made any rule for existing plants subject to congressional approval. It cleared the GOP-controlled House but ran aground in the then-Democratic-controlled Senate.
Capito's new measure would address EPA's Clean Power Plan by allowing state governors to opt out of the rule for existing plants by citing a variety of grid reliability and economic concerns. It would also allow all states to wait to comply until judicial review has concluded -- which could take several years. EPA would be barred from enforcing a federal implementation plan (FIP) in either case. Similar language cleared the House Energy and Commerce Committee last week, and sponsor Whitfield says he expects it to come to the floor this work period.
Environmentalists say that allowing state governors to exempt their states from compliance with the rule for existing power plants would undermine the Clean Air Act's function in creating a federal floor for air quality regulation. But Capito, Manchin and others argued at the bill's launch this afternoon that it is the Obama administration that has violated the law's foundation in cooperative federalism.
"The way the Clean Power Plan is going forward is basically saying, 'The federal government is going to set a one-size-fits-all standard for every state,'" Capito said. Her bill, she said, "gives the states the voice that they need that they do not have in the plan presently."
Capito's measure would also require EPA to write a separate FIP tailored to the power mix in each individual state. The agency is currently preparing one model FIP to be proposed this summer when the rules are finalized.
EPA's rule for existing sources sets state emissions reduction standards -- a power some advocates say should have been left to states. But it calls on states to determine how to comply, and EPA staff and supporters say it affords them ample flexibility to craft a rule to protect economic and reliability interests.
Manchin has been a consistent critic of EPA's climate rules, introducing numerous bills like the one last Congress with Whitfield in an effort to protect his state's coal industry. But he says climate change is occurring and tempers his anti-EPA rhetoric with a message about the importance of federal support for next-stage technology.
That message was on display again at today's launch, when the former West Virginia governor said the Capito bill would "force the federal government to be our partner and work with us" in promoting low-carbon coal technologies.
"All we're saying is work with us," he said. "We can get to the next level."
Manchin blamed the Department of Energy for failing to allocate $8 billion in loan guarantee authority for advanced fossil fuels projects. He also pointed to the administration's decision to scrap its FutureGen clean coal project in Illinois and its preference for supporting renewable power over advanced fossil fuels.
But Manchin sidestepped a question about whether a regulatory trigger would be needed to gain private-sector support for costly low-carbon technologies like CCS.
Capito's bill faces long odds in the Senate, where 60 votes are needed for controversial legislation. But Manchin said he believed it could garner the six Democratic votes it would need if all Republicans backed the bill, which he said they would.
Unions and other traditional Democratic constituencies would need to get "very active" to ensure it passes, he said.
But it is not clear that all Senate Republicans will support the Capito measure. Sens. John McCain of Arizona, Susan Collins of Maine, Kelly Ayotte of New Hampshire and Bob Corker of Tennessee did not sign a letter to EPA last year asking the agency to rescind the Clean Power Plan.
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EPA Critics Seek To Cripple Climate Rules
May 13, 2015 | PoliticoPro
By Andrew Restuccia
The Senate’s EPA critics launched a new offensive on Wednesday to block the Obama administration’s climate change regulations, unveiling legislation that would cripple its planned power plant rules.
The bill, which was written by Sen. Shelley Moore Capito (R-W.Va.) and has the backing of Senate Majority Leader Mitch McConnell, would repeal the EPA’s proposed rules for new, existing and modified power plants, and subject any future regulations to a bevy of requirements.
But the legislation, which so far has 26 co-sponsors, will face fierce resistance from liberal Democrats and a likely veto from President Barack Obama. The White House has threatened to veto previous bills that sought to dismantle EPA regulations, but it has not yet issued a formal veto threat for Capito’s legislation.
Sen. Joe Manchin (W.Va.), the bill’s lone Democrat co-sponsor, told reporters Wednesday that he’s confident he can win the support of five other Democrats — the minimum that would be needed to pass the bill if every Republican supports the legislation.
“We’ve got Democrats that will vote for this piece of legislation,” Manchin said.
So far, the bill appears unlikely to garner the 67 votes that would be needed to override an Obama veto.
Still, the legislation is notable because it is the Republican Senate’s main legislative vehicle for dismantling the EPA’s climate regulations. McConnell, meanwhile, has been looking outside of Congress in his quest to kill the rules, encouraging governors not to submit compliance plans for the agency existing power plant regulation.
Senate Environment and Public Works Committee Chairman Jim Inhofe (R-Okla.) is expected to move the bill through his committee quickly. While no hearings or markups have been scheduled, an Inhofe spokeswoman said it is the chairman’s “priority for this bill to be considered soon.”
Inhofe told reporters on Wednesday that consideration of the bill “is going to go down as probably the most significant thing we will do in the Environment and Public Works Committee this year.”
The legislation is expected to move quickly to the floor, though a spokesman for McConnell did not immediately respond to an inquiry about timing.
Capito called her legislation a “starting point” and she predicted that “we will have some success.”
Under the bill, states would not be required to submit or adopt a compliance plan, nor would they be subjected to a federally imposed compliance plan if a governor determines that the regulations would cost jobs, hurt the economy, threaten electric reliability or raise electricity rates. EPA would be required to issue its own state-focused plans explaining how states can meet its standards.
In addition, the bill would extend the compliance period for the rules until all court challenges are wrapped up. It would also prevent EPA from issuing technology-based standards for new power plants unless that technology has been used for a continuous year at commercial scale on at least six units at different electricity generating stations around the country.
Lastly, the bill blocks the EPA from withholding highway funds from any state that does not comply with the plan. EPA Administrator Gina McCarthy has said her agency does not have the authority to withhold highway funds.
House Republicans are moving similar legislation. The House Energy and Commerce Committee last month approved a bill authored by Rep. Ed Whitfield (R-Ky.) that would, among other things, block EPA’s rule for existing plants until the courts have finished legal reviews of the rule.
Environmental groups quickly bashed the legislation.
“Sen. Capito’s radical legislation reads like a polluter’s wish list, with attacks aimed directly at the heart of the Clean Air Act,” Sara Chieffo, the League of Conservation Voter’s legislative director, said in a statement. “Not only does this bill allow power plants to continue spewing unlimited amounts of carbon pollution into our air, it will prevent us from ever putting in place common-sense limits.”
EPA, for its part, did not directly address the bill in a statement. But the agency strongly defended its climate regulations, arguing they will be “affordable, will drive innovation and American jobs, and will demonstrate our leadership in the international community.”
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Senate Bill To Block ESPS Takes Tougher Approach Than House Measure
May 13, 2015 | InsideEPA
By Doug Obey
More than two dozen Senate Republicans, joined by Sen. Joe Manchin (D-WV), have floated legislation blocking EPA's proposed greenhouse gas (GHG) rules for new and existing power plants, and setting up additional requirements for EPA to issue any further GHG curbs, language that goes beyond legislation recently approved by a House panel.
While the legislation as written faces likely resistance from most Senate Democrats and an almost certain presidential veto, lead sponsor Sen. Shelley Moore Capito (R-WV) is calling the bill a “starting point,” an implicit acknowledgment the bill could be modified in an attempt to garner support from more Democrats.
Such changes may be needed as House Democrats and Republicans have said they will try and reach agreement on a compromise measure that seeks to extend deadlines for states to comply with EPA's existing source power plant rule. The House bill, H.R. 2042, introduced by Rep. Ed Whitfield (R-KY), cleared the House Energy & Commerce Committee April 29 on a party-line vote.
And winning over more Democrats may pose a significant test for the bill's supporters given that most Democratic senators to date have been largely unified in defending EPA's GHG rules.
Manchin at a May 13 press conference dismissed questions on the lack of Democratic cosponsors of the measure by saying he ultimately expects some Democratic support.
“We need six votes” Manchin said, making the case that all Republicans may support the measure and that support from more than six Democrats is plausible. Manchin said the “base of our party,” unions and working families, supports curbs on EPA and “we will get them very active on both sides of the aisle.”
EPA spokeswoman Liz Purchia in a statement reacting to the legislation refrained from criticizing specific elements of the bill but defended the agency's GHG rule for existing power plants (ESPS) as an affordable response to climate change that will drive American innovation and jobs. “Power plants are the largest source of carbon pollution in the United States yet there are no national standards to address this pollution,” she said.
Purchia said the plan “is built on a time-tested state-federal partnership in the Clean Air Act, which was established by Congress decades ago, for EPA to establish public health goals and then gives states important flexibility to design plans to meet their individual and unique needs.”
Capito at the press conference formally unveiled the legislation, dubbed the “Affordable Reliable Electricity Now Act of 2015,” (ARENA), calling it “the principal legislative vehicle in the Senate to rollback the president's Clean Power Plan.”
Capito, joined by Manchin and several Senate Republicans, said the measure has 26 Republican cosponsors, including Senate Majority Leader Mitch McConnell (R-KY), a persistent critic of EPA's rules.
'Little Bit Tougher'
Unlike the House bill, which addresses only EPA's ESPS, the Senate legislation includes language affecting EPA's GHG power plant rules for both new and existing sources.
For example, it includes a prohibition on EPA issuing and enforcing GHG rules for new power plants unless the standard has been achieved at several different power plants in the United States.
A Capito aide says the language on new plants is “substantively identical” to legislation backed last year by Manchin, and notes that further House activity on legislation affecting new sources is expected.
But for now the new Senate bill goes well beyond the ESPS provisions in the House bill, which gives states more time to comply with EPA's rule and allows governors to opt out of the rule's requirements if they show the bill will have “significant” adverse effects on reliability and electricity rates.
For example, the Senate language imposes a lower bar on governors seeking to opt out of the ESPS than the House bill and also eases consultation requirements.
A Capito aide says the language is “a little bit tougher” than the House version in that it does not require “significant” adverse effects and omits House language that requires mandatory consultation with state public service commissions, state health agencies and regional transmission organizations before governors can opt out.
The Senate bill also cites a list of proposed rules -- including the ESPS, and regulations for new and modified power plants -- that “shall be of no force or effect . . . as though the rules had never been issued,” language that would kill the proposed versions of the rules and force any administration to start over.
The Senate measure also includes new language that resolves in favor of EPA's critics an ongoing legal dispute over whether section 111 -- the underlying air act authority for the ESPS -- allows regulation of power plants already subject to air toxics rules.
The critics argue that the air act does not allow such regulation, citing different House and Senate versions of the 1990 air act amendments.
The legislation also sets new requirements for any future ESPS, including a requirement that EPA issue state specific model plans describing in detail how each state will be required to reduce GHGs under the rule.
The Senate bill also includes language explicitly precluding EPA from withholding highway funds from states that resist the rule, a scenario that EPA's critics including McConnell are continuing to play up even though many legal experts say the agency lacks such authority under section 111. Five Republican senators joined Capito and Manchin at the press conference: Sens. Roy Blunt (MO) James Inhofe (OK) John Hoeven (ND) Mike Rounds (SD) and Steve Danes (MT). Inhofe, chair of the Senate environment panel, at the press conference called the ESPS “arguably the largest tax increase in history,” and said the new Senate legislation is “probably the most significant thing that we will do” in the environment panel this year.
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White House NEPA Guidance Provides Certainty But Not Binding, Adviser Says
May 14, 2015 | BNA Daily Environment Report
By Andrew Childers
Federal agencies are not obligated to select project alternatives with the least greenhouse gas emissions under White House guidance on addressing climate change under the National Environmental Policy Act, a White House adviser said.
The Council on Environmental Quality's draft guidance on addressing climate change in the NEPA process is intended to provide consistency and predictability to the review process but it's not a rule and it's not legally binding, Christy Goldfuss, managing director of the White House Council on Environmental Quality, told the House Natural Resources Committee May 13.
“Our guidance offers a consistent approach that increases certainty and preserves agency discretion,” Goldfuss said.
The White House Council on Environmental Quality issued its revised draft guidance on incorporating climate change considerations into National Environmental Policy Act reviews in December 2014. The draft guidance advises federal agencies to consider the climate impact of any action that would increase greenhouse gas emissions by the equivalent of 25,000 metric tons of carbon dioxide annually when reviewing projects (244 DEN A-8, 12/19/14).
This was the first in a series of hearings on NEPA that committee Chairman Rob Bishop (R-Utah) said he plans to hold on the law with an eye toward reforming it. Committee Republicans argued the guidance, which has not been issued as a formal rulemaking subject to public comment and review, would open projects up to new legal challenges, causing further delays.
“This is a lawyer's dream,” Rep. Don Young (R-Alaska) said.
Goldfuss said NEPA reviews are already subject to court reviews and the draft guidance does not provide new opportunities for litigation. Instead, the draft guidance is intended to provide a framework for federal agencies as they evaluate the climate change impacts of projects.
“That challenge could still come,” Goldfuss said. “We have more than 20 cases that have criticized the agencies and how they have or have not analyzed climate change.”
Though the administration argues the draft guidance is not binding, opponents said no federal agency will choose to ignore direction from the White House.
“It's unrealistic to think any federal decision maker would ignore any kind of guidance from the White House on these issues,” Roger Martella, a partner at Sidley Austin LLP, said.
NEPA Needs Reform
Bishop suggested the guidance would be better integrated into the NEPA review if the law were amended by Congress rather than as directives from the Council on Environmental Quality.
“Fix the statute as opposed to writing more regulations and more guidance,” he said. “That's the proper approach to it.”
Rep. Jim Costa (D-Calif.) also said he would be open to revising the law. He called its goals laudable but said ongoing litigation over NEPA reviews unnecessarily delays approval of projects.
Costa called debates over the law's utility “mind-numbing” and said he was more interested in “instructive comments on how we can get past our talking points.”
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Private Sector, Young Citizens Will Push U.S. To Climate Action, Ex-EPA Administrator Says
May 14, 2015 | BNA Daily Environment Report
By Anthony Adragna
A combination of private sector engagement, younger generations and successful actions by states and cities may drive Congress to once again become active in addressing climate change, former Environmental Protection Agency administrator and New Jersey Republican Gov. Christine Todd Whitman said May 13.
Absent congressional action, which Whitman conceded would be “much better,” the EPA's proposed Clean Power Plan will be a “game changer” for addressing the risks and impacts of climate change today, she told a Bloomberg Government breakfast.
“The problem with any environmental regulation is you're forcing somebody to spend more money or to change behavior for a problem that they may not think is theirs or they may not see [or] may not think is real,” Whitman said. “It would be much better [to get Congress involved].”
Private sector companies are being forced to account for responding to climate change when complying with federal regulations and may at some point view congressional action as a way to bring surety to their operations, Whitman said. That will only happen after some companies successfully reduce their emissions while maintaining healthy business growth.
Whitman also said “more and more” Republicans are privately acknowledging the need for concerted action to address climate change, though they cannot say so publicly for fear they will be voted out of office.
The former New Jersey governor and former U.S. Trade Representative Ron Kirk spoke in their roles as co-chairs of the Clean and Safe Energy Coalition, dedicated to the promotion of nuclear energy.
Whitman served as EPA administrator from 2001 though 2003 after leading New Jersey from 1994 until joining the agency.
China Agreement Called Huge
A joint agreement between China and U.S. to reduce their carbon pollution could have a “huge impact” toward mobilizing international action on climate change, Whitman said.
President Barack Obama and Chinese President Xi Jinping made a surprise announcement in November 2014 announcing long-term carbon pollution reduction goals. The U.S. pledged to slash its greenhouse gas emissions by 26 percent to 28 percent below 2005 levels by 2025, while China pledged to peak its carbon emissions by 2030 with the goal of doing so sooner (219 DEN A-8, 11/13/14).
In spite of that promise, the former agency chief said it was unclear how significant an agreement the international community might reach in Paris at the end of 2015 but faulted her own party for seeking to undermine the negotiations.
“Something will come out of Paris but, how much, I don't know,” Whitman said. “But it does undermine the president's ability when you have the Congress sitting there saying, ‘we don't care what he does, we're going to undo it.’ That makes it a little more difficult for our international partners overseas.”
Kirk said the announcement with China was “huge” because it brought the world's largest greenhouse gas emitter to the table and showed the international community the U.S. intended to take serious action.
“If the U.S. isn't involved in pushing an envelope for a solution on any of these things, it won't happen,” Kirk said.
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Senate GOP Launches Attack On EPA Climate Rules
May 13, 2015 | The Hill - E2 Wire
By Timothy Cama
Senate Republicans introduced a bill Wednesday that would overturn the Obama administration’s landmark climate regulations for power plants and make it nearly impossible to rewrite them.
The bill is the GOP’s first major legislative push against the Environmental Protection Agency’s emissions limits since Republicans seized control of the Senate in November.
The rules have drawn intense criticism from Republicans and industry groups, who warn they will cost billions of dollars, hundreds of thousands of jobs and have negligible environmental benefits.
“Our bipartisan legislation would empower the states to protect families and businesses from electricity rate increases, reduced electrical reliability and other harmful effects of the president’s Clean Power Plan,” Sen. Shelley Moore Capito (R-W.Va.), the bill’s sponsor, told reporters Wednesday.
“Our bill would also require that any greenhouse gas standard set by the EPA for new coal-fired power plants are able to be achieved by commercial power plants operating in the real world,” she said.
Twenty-five Republican senators, including Senate Majority Leader Mitch McConnell (R-Ky.), signed into the bill as co-sponsors, as did Sen. Joe Manchin (D-W.Va.).
The bill, dubbed the Affordable Reliable Energy Now Act, would prevent the EPA from writing rules that are “significantly similar” to its current proposals unless it follows specific parameters that the bill outlines.
The measure sets out different standards for the two separate regulations the EPA proposed last year on newly built power plants and existing ones. The latter regulation, which aims to cut the power sector’s carbon emissions 30 percent by 2030, is by far the most controversial.
Environmental groups immediately criticized the Republican bill as an attack on clean air and the most significant effort yet to fight climate change.
Republicans say the bill is a necessary step toward protecting states and electricity customers from the rules.
“I’ve never seen anything quite this universally opposed,” said Sen. James Inhofe (R-Okla.).
“This is going to go down probably as, probably, the most significant thing we will do in the Environment and Public Works Committee this year,” he said. Inhofe chairs that committee.
The legislation would immediately overturn both regulations and prevent the EPA from reissuing them without taking specific steps.
For the existing plant rule, the EPA would have to submit to Congress reports on the rule’s effects on greenhouse gases and climate change, and would have to write individual sample compliance plans showing how each state could abide by the regulations.
Still, that would not take effect until all court challenges are exhausted, and governors would be able to opt out of complying with it if they believed it would bring any of a wide range of negative impacts.
If the EPA wants to regulate new plants, it would have to develop different standards for plants that use coal and those using natural gas, and technology to achieve the standards would have to be commercially available and in use on multiple existing power plants.
That provision goes directly to GOP complaints that the EPA’s proposal would mandate carbon capture technology not currently on the market.
“The facts are that coal’s going to be used to supply power to the United States for many, many years,” said Manchin, who famously shot cap-and-trade legislation with a rifle in an ad for his 2010 Senate campaign.
“If you’re going to use it, you should use it as clean as possible. And all we’ve asked for is for the federal government to be our partner and work with us.”
The court delay and state opt-out provisions are similar to, though stronger than, ones in a bill passed by the House Energy and Commerce Committee. Manchin and Rep. Ed Whitfield (R-Ky.) sponsored legislation similar to the provisions for new plants last year.
Capito’s bill also modifies the Clean Air Act to say power plants already regulated under one provision of the statute would not be eligible for further regulation under another.
Some opponents of the rule say the Clean Air Act already says that, though there are conflicting interpretations of the law.
That provision of Capito’s legislation would effectively make the Obama administration’s main climate rule moot.
Green groups are sharply criticizing the bill.
“Senator Capito’s radical legislation reads like a polluter’s wish list, with attacks aimed directly at the heart of the Clean Air Act,” Sara Chieffo, legislative director for the League of Conservation Voters, said in a statement.
“Not only does this bill allow power plants to continue spewing unlimited amounts of carbon pollution into our air, it will prevent us from ever putting in place common sense limits,” she said.
EPA spokeswoman Liz Purchia said the senators’ concerns are on EPA officials’ minds.
“EPA continues to work toward completing the proposed Clean Power Plan that will cut harmful carbon pollution from power plants,” she said.
“The plan will be affordable, will drive innovation and American jobs, and will demonstrate our leadership in the international community.”
The White House Office of Management and Budget is currently reviewing the EPA’s final rule for new power plants. The Obama administration plans to make both rules final in the summer.
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Report Touts Benefits of Tighter Ozone Standard
May 14, 2015 | BNA Daily Environment Report
The Environmental Protection Agency should set national ozone at a level of 60 parts per billion to fully realize the health benefits associated with improving air quality, the Center for Effective Government said in a new report. Released May 13, the report highlights the EPA's own estimates that ozone standards of 60 ppb would prevent as many as 5,800 premature deaths and avoid as much as $20 billion in annual health care costs by 2025. The EPA has a court-ordered deadline of Oct. 1 to make a final decision on whether to revise or retain the current ozone standards of 75 ppb. The agency in November 2014 proposed (RIN 2060-AP38) to revise the standards to somewhere in the range of 65 ppb and 70 ppb, but many public health and environmental groups urged the EPA to tighten the standard even further (229 DEN A-1, 11/28/14). The open government group also used its ozone report to highlight a decline in the amount of federal air quality grants state agencies have for implementing air programs and to urge Congress to increase funding for state and local air quality agencies. A copy of the report is available at http://www.foreffectivegov.org//files/regs/gasping-for-support.pdf.
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EPA Lacks Statutory Authority to Regulate Plastic Microbead Discharges by Consumers
May 14, 2015 | BNA Daily Environment Report
By Amena H. Saiyid
The Environmental Protection Agency lacks Clean Water Act authority to regulate consumer use of plastic microbeads that are entering wastewater discharged to treatment plants, an agency official said at a pretreatment workshop May 13.
Janet Goodwin, chief of the EPA Office of Wastewater's Technology and Statistics Branch, said most of the plastic microbeads that are found in wastewater effluent come from their use by people. The EPA only has the authority to regulate plastic microbeads that enter wastewater from industry, either through effluent guidelines or pretreatment standards, she said.
Goodwin spoke at the National Pretreatment & Pollution Prevention Workshop sponsored by the National Association of Clean Water Agencies in Greenville, S.C. The four-day workshop runs through May 15.
“Most of what you are receiving is coming from the consumer, not the manufacturer,” Goodwin said in response to a question by John Botts, pretreatment manager for the Fairfax County, Va., Department of Public Works & Environmental Services' Industrial Waste Section.
Botts asked whether the EPA planned to look at plastic microbeads within the larger study of wastewater discharges from the manufacture of products using nanomaterials. Plastic microbeads are used in toothpaste, facial scrubs and other personal care products. They are smaller than five millimeters in diameter and have been found to pass through the filters of wastewater treatment plants and end up in rivers, lakes and larger bodies of water, such as the Great Lakes.
According to Botts, it is now up to Congress to find a way to regulate these small particles.
Uniform Regulation Sought
At a May 1 hearing of the House Energy and Commerce Subcommittee on Health, a representative from the Personal Care Products Council urged Congress to create a uniform, consistent federal ban on products containing microbeads instead of the patchwork of state regulations that is emerging.
The hearing also discussed the Microbeads-Free Waters Act of 2015 introduced by Reps. Fred Upton (R-Mich.) and Frank Pallone (D-N.J.) to tackle the problem (85 DEN A-4, 5/4/15).
Botts asked about studying plastic microbeads because the EPA as part of its preliminary 2014 effluent guidelines plan said it would seek data and information on potential industrial wastewater discharge hazards associated with nanomaterial manufacturing.
Goodwin said the EPA study wasn't looking at plastic microbeads but instead was more focused on nanotubes and nanosilver products.
EPA Required to Publish Schedule
Section 304(m) of the Clean Water Act requires the EPA to publish a schedule every two years for annually reviewing and possibly revising effluent guidelines that have been promulgated as required by Section 304(b).
Under Section 304(b), the EPA regulates the discharge of pollutants from industries directly to surface waters through effluent limitation guidelines and indirect discharges via wastewater treatments plants through pretreatment standards. Both regulatory limits are based on available technology.
Goodwin said the agency plans to release the final 2014 effluent guidelines plan this summer, depending on when the White House Office of Management and Budget completes its review.
The OMB began its review in late April. Usually such a review marks the last step before a federal agency releases a policy, rule or guidance to the public (72 DEN A-20, 4/15/15).
Goodwin added that the EPA wouldn't be able to provide any update on the studies of nanomaterials and other industrial sectors in the final 2014 effluent guidelines plan because the studies were started in late 2014. The agency would be in a better position to report on the status of the studies of nanomaterials, petroleum refineries and central waste treatment facilities in its preliminary effluent guidelines plan for 2015, however, she said.
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(ACC Mentioned) Freight Rates Spark Hearing Clash Between Industry, Customers
May 14, 2015 | E&E Daily News
By Jeremy P. Jacobs
Representatives of the freight rail industry yesterday clashed sharply with its customers on whether the sector needs more regulation to ensure fair shipping rates.
At issue: the 1980 Staggers Rail Act, the law that virtually saved the rail industry from complete collapse by deregulating it and allowing it to set rates based on market forces.
Thirty-five years later, many in Congress are asking whether the law needs updating because freight rail companies have been consolidated through mergers -- leaving four giants that set rates for most shipping.
Concerns spiked after widespread rail car shortages in the winter of 2013 to 2014 led to shipping backlogs in the Upper Midwest.
Cal Dooley, a former California Republican congressman and president of the American Chemistry Council, told the House Transportation and Infrastructure Subcommittee on Railroads, Pipelines and Hazardous Materials that shipping rates have risen 100 percent since 2001.
ACC's members are the second largest class of shippers by rail in the country.
"We're asking for some common-sense reforms to the Staggers Act," Dooley said. "It is in bad need of reforms."
Dooley's remarks were countered by Edward Hamberger of the Association of American Railroads. Tinkering with the Staggers Act, he said, would be "trying to fix something that is not broken."
In particular, he said his industry "quietly goes about its business" while spending $575 billion in private capital on improving its tracks and infrastructure.
The hearing came the morning after Amtrak train 188 derailed in Philadelphia, killing at least seven passengers and injuring about 200 more.
That led some Democrats on the panel to criticize a Republican appropriations bill that would cut $260 million from Amtrak's capital grants program (Greenwire, May 13).
All subcommittee members offered their condolences to the victims of the accident before turning to whether, and how, the Staggers Act should be updated.
Dooley in particular criticized the Surface Transportation Board's process for challenging potentially unfair rates. That process can cost $5 million and take three years to resolve, he said.
"That clearly is not acceptable," he said.
Debra Miller, the STB's acting chairwoman, didn't disagree.
"Industry is frustrated with our pace, and so am I," she said.
But Miller also said the STB faces other challenges. Lawmakers noted that only two of the three leadership positions on the board are filled, and Miller said the agency is using a "third world" computer system and lacks funds to update it.
"We really don't have the resources necessary," she said.
Lawmakers failed to provide insight into how they might seek to reform the process. Transportation and Infrastructure Chairman Bill Shuster (R-Pa.) asked witnesses mostly about a bill that recently passed out of the Senate Commerce, Science and Transportation Committee.
S. 808 is an STB reauthorization from Sens. John Thune (R-S.D.) and Bill Nelson (D-Fla.). It would expand the board's leadership from three to five and allow voluntary arbitration to resolve rate disputes.
Most of the witnesses struck a generally positive note about the bill. Frustration at STB
The generally low-key hearing was infused with energy near its conclusion by Massachusetts Rep. Michael Capuano, the top Democrat on the subcommittee.
Capuano expressed frustration at the STB's approval of projects that seemingly are unrelated to rail service.
He cited the approval of propane and hazardous waste facilities that allowed rail companies to sidestep local health and safety controls because the board's authority pre-empted local ordinances like zoning.
"Why should I have faith that the STB is not simply a tool of the railroad industry?" he asked Miller, noting that the propane facility was in his home state.
Miller said her board needs to take a closer look at "whether or not an activity ... is part" of normal rail operations.
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(ACC Mentioned) US Chemical, Other Industries Press Congress On Rail Freight Reform
May 13, 2015 | ICIS Chemical Business
By Joe Kamalick
US chemicals producers and a broad range of other manufacturing, agricultural, auto, electric power and steel producers on Wednesday urged prompt action by Congress to reform federal railroad freight rate-setting rules.
In a hearing before the House Subcommittee on Railroads, Pipelines and Hazardous Materials, American Chemistry Council (ACC) president Cal Dooley argued that the 35-year-old rail regulation Staggers Act badly needs an update to allow more flexibility in federal oversight of freight rail rates.
Dooley noted that as the US chemicals sector is undergoing a renaissance due to greatly improved natural gas feedstock resources from shale deposits, his industry will be even more dependent on rail freight and vulnerable to what many producers consider unreasonable rates.
He said that the 1980 Staggers Act – credited with rescuing US railroads from potential financial collapse – “has been successful in many ways, but the freight rail service landscape has changed dramatically since its passage”.
“Consolidation has reduced the number of Class I railroads from 26 in 1980 to only seven today, with four essentially operating like regional duopolies that control 90% of the market,” Dooley said.
US Class I railroads control some 100,000 miles of the nation’s total 140,000 miles of track. So-called short-line railroads operate various segments of the 40,000-mile balance of rail track capacity.
As he has so often in the past, Dooley cited in particular the plight of many chemicals producers and other manufacturers who are “captive shippers”, those dependent on only a single rail carrier to receive bulk raw materials and to ship out products.
“Today, more than three-quarters of US rail stations are served by only one rail company,” Dooley told the panel, “leaving customers captive to a single freight rail provider with no alternative if service or rates are unsatisfactory.”
He said that rail freight rates have increased by nearly 100% over the past decade, about three times the rate of inflation.
Those increases, he said, are “forcing shippers to divert significant resources from research and development [R&D], operations, investment, expansion and hiring to pay extremely high rail shipping rates”.
Joined by 47 other industrial groups heavily dependent on rail freight services, Dooley urged Congress to make changes to the Surface Transportation Board (STB) so that the agency can be more proactive and efficient in monitoring and addressing freight rail rate issues.
The STB, also known as the SurfBoard, was created under the Staggers Act and is supposed to ensure fair freight pricing.
Among other reforms, Dooley said that “the STB should eliminate outdated exemptions and allow shippers to seek review of unreasonable rates for shipping certain products such as automobiles, food, lumber and metals”.
“The board should no longer automatically assume that shippers of these products have access to competitive service,” he said.
To address the problem of captive shippers, Dooley asked that STB allow shippers to use one Class I rail carrier to move products to a nearby rail connection with another Class I provider.
He also asked that the board institute a more efficient, workable and lower cost method for review of freight rail rates, a process that now can cost hundreds of thousands of dollars and take years to resolve.
The chemicals sector and other rail-dependent industries support a bipartisan Senate bill, the “Surface Transportation Board Reauthorisation Act” (S-808), that would mandate many of the freight rail review reforms sought by industry.
In addition to chemicals and fuels producers, the Rail Customer Coalition (RCC) includes the American Farm Bureau Federation, the Alliance of Automobile Manufacturers, the American Forest & Paper Association, the American Public Power Association, the Fertilizer Institute, the National Association of Chemical Distributors (NACD), steel manufacturers and cement producers.
The Senate STB reform bill was approved by a unanimous committee vote in that chamber and is awaiting a full vote on the Senate floor. That bill, if passed in the Senate, would then be heard in the House unless a separate companion bill is introduced.
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Committee Approves House FY 2016 PHMSA Funds
May 14, 2015 | BNA Daily Environment Report
The House Appropriations Committee approved by a 30–21 vote May 13 its Transportation, Housing and Urban Development appropriations bill for fiscal year 2016 that includes hazmat and pipeline safety funding. Five amendments were adopted, none of which centered on hazardous materials transportation or pipeline safety. The appropriations bill would fund the Pipeline and Hazardous Materials Safety Administration at $227 million, with $60.5 million for hazardous materials safety programs and $145.9 million pipeline safety program. The bill would provide $17.2 billion in discretionary appropriations for the Transportation Department overall. The House subcommittee released the bill April 28 and approved the bill April 29 with no amendments from the House Appropriations Subcommittee on Transportation, Housing and Urban Development (82 DEN A-5, 4/29/15). A spokesman for House Majority Leader Kevin McCarthy (R-Calif.) didn't immediately respond to Bloomberg BNA's message asking when the bill would be scheduled for a House floor vote.
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PHMSA Solicits Crude-by-Rail Reporting Comments
May 14, 2015 | BNA Daily Environment Report
The nation's hazardous materials safety agency is soliciting comments from tank car owners that ship flammable liquids, including crude oil, on a future revised information collection request, the agency will announce May 14. Under a recently published Pipeline and Hazardous Materials Safety Administration rule on flammable liquids-by-rail safety, certain owners of non-jacketed DOT-111 tank cars will be required to begin reporting several numbers, such as how many DOT-111 tank cars haven't been retrofitted to new standards, in January 2017. The Transportation Department secretary would also be able to require additional reports of this information “with reasonable notice,” a requirement that would be made under a future information collection request notice, the public inspection notice said. These additional reports to the secretary would add an estimated annual burden cost of $1,000 to an estimated additional 50 respondents, the notice said. The notice is available for review at https://s3.amazonaws.com/public-inspection.federalregister.gov/2015-11625.pdf and will be available for public comment through July 13. Comments may be submitted through www.regulations.gov using Docket No. PHMSA-2012-0082 (Notice No. 15-13).
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Two Illinois Municipalities Challenge New Oil-Train Rules
May 13, 2015 | The Wall Street Journal
By Laura Stevens
In the latest legal challenge to the federal government’s new crude-by-rail rules, two Illinois municipalities on Wednesday filed a petition asking a Chicago-based federal appeals court to review the rules, saying regulators didn’t go far enough.
The village of Barrington and the city of Aurora jointly filed the petition, asking for the U.S. Seventh Circuit Court of Appeals to set aside and remand parts of the rules. The municipalities are specifically challenging an exemption that allows some trains to continue using dangerous older tank cars, as well as a phaseout schedule for certain tank cars hauling flammable liquids that they deem to be “unreasonably long.”
They also want the rules to require railroads to provide electronic documentation of the contents of the train to emergency workers when an accident occurs.
The Transportation Department didn’t immediately respond to a request for comment. The Federal Railroad Administration doesn’t comment on pending litigation, a spokesman said. At the time of the announcement, regulators said that the rules were comprehensive and would make transporting hazardous liquids by rail significantly safer. They added that the rules were expected to stand up to a legal challenge in court.
The filing follows a similar petition by the American Petroleum Institute to the U.S. Court of Appeals for the District of Columbia Circuit on Monday. That petition seeks to set aside and remand the timetable of retrofitting tank cars, as well as a requirement to install new braking systems, and any limitations on trains or cars that don’t meet those requirements. However, the oil industry would like a longer timetable for phasing in the new railcar design, something it argues is needed due to limited manufacturer capacity to complete the work.
The new rules, announced on May 1, call for tanker cars carrying crude and other hazardous flammable liquids during the next decade to be outfitted with new safety features, including steel jackets and metal shields on both ends to prevent ruptures. Additionally, the new rules require trains carrying 70 or more cars of hazardous flammable liquids to be equipped with expensive new brake systems or be subjected to sharply lower speed limits or restrictions on the number of cars.
The new rules don’t apply to trains carrying hazardous flammable liquids in fewer than 35 tank cars total or a block of less than 20 tank cars.
“We weren’t happy with the rule. We felt that it really fell far short of offering the protection that could be there, that could be offered, and it was a step back,” said Karen Darch, village president of Barrington. She added that trains could still carry significant amounts of hazardous flammable materials in older tank cars, a huge safety risk for towns like hers.
The railroad industry also plans to challenge the new rules, either by petitioning the Transportation Department for reconsideration or in court.
Railroad executives say the rules don’t go far enough in some areas, including the exemption for older tank cars in trains carrying smaller loads. In addition, they say the mandate to install new brakes is excessive and the safety benefits are unproven.
Communities in the path of oil trains, including the ones filing the petition, have called for greater transparency in crude-by-rail routes and slower trains in the wake of at least nine fiery derailments since 2013, including one in Canada which killed 47 people.
Last week, aBNSF Railway Co. oil train derailed in North Dakota and six tank cars caught fire. All 40 residents of the nearby town of Heimdal were safely evacuated, and no one was injured.
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