Preview Newsletter
ACC June 9
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(ACC Mentioned) EPA's Findings on Ammonia, Ethylene Oxide, Trimethylbenzenes Backed by Advisory Panel
Jun 9, 2015 | BNA Daily Environment Report
By Pat Rizzuto
Three draft scientific critiques endorsing the Environmental Protection Agency's key conclusions about the health effects of ammonia, ethylene oxide and trimethylbenzenes were largely approved by the agency's Chartered Science Advisory Board June 8. Each of the draft scientific critiques examined... -
McConnell Seeks Vote Before August Recess On Measure to Revise Toxic Substances Law
Jun 9, 2015 | BNA Daily Environment Report
By David Schultz
Senate Majority Leader Mitch McConnell (R-Ky.) said he hopes to bring legislation revising the Toxic Substances Control Act (S. 697) to the floor this summer. In an interview published June 7 by the digital news outlet “Morning Consult,” McConnell cited the legislation as one of a number of measures with bipartisan support for which he ... -
Pallone Seeks Balance Between Deal-Making, Party Messaging
Jun 9, 2015 | Roll Call
By Emma Dumain
Several months after winning a competitive race to be ranking member of the Energy and Commerce Committee, Rep. Frank Pallone Jr. wants to downplay the drama. The New Jersey Democrat said last year’s “showdown” with Rep. Anna G. Eshoo, the California Democrat with whom he shares a corridor in the Cannon House Office Building ... -
(ACC Mentioned) Commentary: Amid A Benign US Economy, Beware A Shift In Global Consumption Trends
Jun 8, 2015 | ICIS News
By Joseph Chang
Amid a benign US economic environment, chemical sector production volumes are poised to grow faster than GDP, especially as new projects based on the shale gas competitive advantage ramp up in the coming years. Despite the major decline in oil prices since Q4 2014, “the US chemical industry is still very competitive. -
Fracking Associated With Smaller Babies
Jun 8, 2015 | The New York Times
By Nicholas Bakalar
A new study has found an association between hydraulic fracturing, or fracking, and smaller babies. The scientists used data on 15,451 live births in southwest Pennsylvania from 2007 to 2010. They categorized the mothers by how close they lived to gas wells and the concentration of wells in the area. -
Is Our Drinking Water Safe From Fracking?
Jun 8, 2015 | The Washington Post
IN THE ongoing war over fracking, the loudest voices try their best to obscure this essential point: The controversial drilling technique doesn’t need to be banned; it needs to be well regulated. That’s how we explain the seemingly contradictory reaction to the Environmental Protection Agency’s assessment of fracking’s effects on drinking... -
The Good, The Bad And The Ugly When Oil Giants Shift To Natural Gas
Jun 8, 2015 | Environmental Defense Fund
By Ben N. Ratner
Six large European oil and gas companies recently announced a commitment to engage on climate policy, calling for a price on carbon. The now-emerging picture of their coordinated corporate talking points, however, leaves no doubt that promotion of natural gas is a core part of the group’s position. -
Key Industry Meetings Explore Electric Reliability Concerns
Jun 8, 2015 | E&E News PM
By Emily Holden and Rod Kuckro
With the Clean Power Plan under final review at the White House, electric industry conferences this week will focus on how states can implement the draft rule without jeopardizing electric reliability. In New Orleans, the utility trade group, the Edison Electric Institute, is holding its annual convention, which includes a panel about how the draft... -
House Panel To Mark Up Forestry, Power Line And Pipeline Bills
Jun 9, 2015 | E&E Daily News
By Phil Taylor
The House Natural Resources Committee tomorrow will mark up bills allowing quicker approval of logging projects that reduce wildfire threats in national forests -- part of a broader GOP push to slash environmental red tape. The committee will also vote on bills to allow the Interior Department to approve gas pipelines through national parks... -
GOPer Pledges $175 Million To Push Party On Climate
Jun 8, 2015 | PoliticoPro
By Darren Goode
A Republican entrepreneur is putting a whopping $175 million behind a campaign whose message will have some party stalwarts seeing red: The GOP needs to deal with climate change. North Carolina businessman Jay Faison will launch a social media and online advertising blitz, backed by state ... -
Southern California Air Quality Officials Adopt Stricter Toxic Air Rules
Jun 9, 2015 | BNA Daily Environment Report
By Carolyn Whetzel
An estimated 87 facilities in Southern California could face stricter requirements for emitting toxic air contaminants under rules the South Coast Air Quality Management District has updated to reflect the state's new risk assessment guidelines for air toxic hot spots. -
Carbon Tax Or Cap-And-Trade: Which Would Work Better?
Jun 8, 2015 | The Washington Post
By Jared Bernstein
Which is a better policy for reducing greenhouse gases: a tax on carbon or a cap-and-trade approach? Given today’s gridlocked politics, I realize that’s a little bit like asking: Do you like your unicorns to be striped or polka-dotted? But as the Times pointed out: This week, the top executives of six large... -
Senate Secret Science Bill to Cost EPA $250M Yearly to Implement, CBO Estimates
Jun 9, 2015 | BNA Daily Environment Report
By David Schultz
The Congressional Budget Office is standing by its earlier estimates that legislation to add new requirements on the scientific studies that may be used by the Environmental Protection Agency would cost the agency $250 million a year to implement. The CBO released on June 5 a cost estimate ... -
House Members Urge Moniz To Revise Furnace Rule
Jun 9, 2015 | E&E Daily News
By Nick Juliano
More than 120 House members, primarily Republicans, are asking Energy Secretary Ernest Moniz to reconsider a recently proposed rule to boost the efficiency of natural gas furnaces. In a letter yesterday, the members warned that the proposed rule would increase costs for some homeowners and could lead them to switch to less expensive... -
Calif Issues New Air Quality Rules After Cancer Study
Jun 8, 2015 | The Hill - E2 Wire
By Devin Henry
A new air quality rule will require some southern California industrial facilities to reduce toxic emissions or notify the public of the health risks from them. California’s South Coast Air Quality Management District board approved the new rules Friday after state officials issued guidelines saying the cancer risk from toxic chemicals is almost three... -
No State Consensus on Best Way to Handle Particulate Precursors Under 2012 Standards
Jun 9, 2015 | BNA Daily Environment Report
By Patrick Ambrosio
State environmental agencies are split over how best to demonstrate that control of precursor emissions is not necessary for an area to attain the current national ambient air quality standards for fine particulate matter, comments submitted to the Environmental Protection Agency show. -
Supreme Court Denies Alaska Railroad, Coal Companies' Seward Permit Shield Petition
Jun 9, 2015 | BNA Daily Environment Report
By Lars-Eric Hedberg
The U.S. Supreme Court denied June 8 a petition to review whether a Clean Water Act permit shield covers pieces of coal that fall off a conveyer system at a coal export facility and spill into Alaska's Resurrection Bay (Aurora Energy Servs. LLC v. Alaska Cmty. Action on Toxics, U.S., No. 14-1060, cert. denied, 6/8/15). -
Wastewater Utilities Warn EPA's Delay Of 'Needs' Survey Undermines SRF
Jun 8, 2015 | InsideEPA
By David LaRoss
Wastewater utilities are warning that EPA's long delay in updating its 2008 survey of water infrastructure "needs" is undermining the agency's clean water state revolving fund (SRF) that pays for infrastructure upgrades, because the years-old survey likely understates the level of funding needed compared to the pending 2012 version of the study. -
9th Circuit Appears Ready To Endorse New NEPA Climate Standing Test
Jun 8, 2015 | InsideEPA
By Dawn Reeves
A three-judge panel of the U.S. Court of Appeals for the 9th Circuit appears likely to expand a precedent that allows environmentalists and other plaintiffs to cite local harms from federally approved projects to win standing when challenging the adequacy of agency consideration of climate impacts under National Environmental Policy Act ... -
Republican Pours Money Into U.S. Climate, Clean Energy Foundation
Jun 8, 2015 | Reuters
By Timothy Gardner
A Republican businessman said on Monday he is pouring millions of dollars into a foundation that sees opportunities where the majority of his fellow party members do not: easing climate change and speeding the country's transition to clean energy. Jay Faison of Charlotte, North Carolina, has given $165 million to Clearpath... -
N.Y. Comptroller Requests Safety Information From Oil, Rail Companies
Jun 9, 2015 | BNA Daily Environment Report
By Gerald B. Silverman
New York State Comptroller Thomas P. DiNapoli (D) has sent letters to 14 oil and rail companies seeking information on the measures they are taking in response to recent accidents involving the transportation of crude oil by rail, the state official announced June 8. -
Canada to Expand Reporting of Incidents, Harmonizing Requirements With U.S.
Jun 9, 2015 | BNA Daily Environment Report
By Peter Menyasz
Canada is proposing expanding its reporting regime for incidents involving transportation of goods by all modes to include any releases that endanger or could endanger public safety and that harmonize Canada's reporting regime with that in the U.S. Proposed amendments to the Transportation...
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Jun 9, 2015 | BNA Daily Environment Report
By Pat Rizzuto
Three draft scientific critiques endorsing the Environmental Protection Agency's key conclusions about the health effects of ammonia, ethylene oxide and trimethylbenzenes were largely approved by the agency's Chartered Science Advisory Board June 8.
Each of the draft scientific critiques examined a draft toxicological review prepared by the agency's Integrated Risk Information System program. The IRIS reviews analyzed scientific data concerning the human health hazards the three chemicals posed and the doses at which the hazards could manifest.
Each of the scientific critiques, also called peer review reports, will be revised to reflect recommendations CharteredSAB members made during the board's June 8 teleconference and then forwarded as recommendations to the EPA's administrator.
Key Conclusions
The board's recommendations, however, did not alter the basic support the draft peer review reports had given to the agency's key conclusions.
The conclusions included:
• Inadequate information exists to determine whether ammonia may cause cancer, but people could experience respiratory problems if they inhaled daily concentrations greater than 0.3 milligram of ammonia per cubic meter of air throughout their lives (137 DEN A-7, 7/17/14).
• Ethylene oxide, which is used to sterilize medical instruments and also to make ethylene glycol, a key ingredient in antifreezes, polyester fibers and some plastics, is a human carcinogen when inhaled (160 DEN A-13, 8/19/14).
• Trimethylbenzenes (TMBs), which are found in gasoline, can cause nervousness, dizziness, headaches, vertigo, motor-coordination, respiratory or other health problems if doses are higher than those detailed in the agency's assessment (124 DEN A-13, 6/28/12)
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The draft reports endorsed those key conclusions but suggested ways the EPA could improve its analysis and better explain the reasoning behind analytic choices made in each assessment. The peer review reports were prepared by three separate panels operating under the umbrella of the SAB's Chemical Assessment Advisory Committee.
No member of the public addressed the CharteredSAB regarding the critique of EPA's ammonia assessment.
Industry Groups: Do Not Approve TMBs Report
Nancy Beck, a toxicologist with the American Chemistry Council, and Moyinoluwa David Adenuga, a toxicologist who spoke on behalf of ACC's Hydrocarbon Solvents Panel, objected to the trimethylbenzenes report moving forward as advice to EPA's administrator.
The Chemical Assessment Advisory Committee that prepared the trimethylbenzenes report failed to reach consensus on critical issues that could directly affect the risk values contained in the IRIS analyses, Beck said.
Agency, state and other risk analysts combine IRIS's risk values with exposure and other information as they prepare risk assessments that underlie cleanup, air emission and other regulatory decisions.
“The report should not be approved in its current state,” Beck said.
The committee that prepared the peer review report should be augmented with two additional members with expertise in neurotoxicity and risk assessment generally, Beck said.
Adenuga said the IRIS assessment concludes trimethylbenzenes pose a much greater hazard to human health than did a similar analysis conducted by the EPA's Office of Pesticide Programs.
“The SAB should recommend that EPA return to the drawing board to understand why there is such a huge disparity in the IRIS and OPP assessments of practically the same substances,” Adenuga said.
J. Allen Davis, the manager of the IRIS program's trimethylbenzenes assessment, said the IRIS and pesticide programs' assessments reached different conclusions because they were examining different questions and therefore looked at very different data.
The IRIS program understands, however, that the SAB panel wants the program's final trimethylbenzenes assessment to better address some of data suggested by industry and evaluated by the pesticide program, Davis said.
SAB Committee Should Be Clearer
Beck, Bill Gulledge, senior director of ACC's Chemical Products and Technology Division, and Jake Vandevort, who manages the Ethylene Oxide Sterilization Association Inc., urged the chemical assessment committee to revise its draft critique of the EPA's ethylene oxide assessment and clarify why the committee supported the agency regarding key issues where there is scientific disagreement.
For example, the committee should more thoroughly explain why it agreed with the agency's conclusion to evaluate ethylene oxide with a linear approach, which presumes any exposure could increase the risk of cancer, Beck said.
The committee's reasoning for supporting the agency's decision not to use data, generated by the Union Carbide Corporation, concerning workers exposed to ethylene oxide who did not experience cancer also would be elaborated, she said.
One member of the CharteredSAB, Michael Dourson, president of the consulting group Toxicology Excellence for Risk Assessment, volunteered to work with the committee to revise its report.
The other Chartered SAB members rejected his offer, however, saying the co-chairman of the Chartered SAB will work with the chairman of the ethylene oxide panel to revise the report.
Members of the chemical assessment advisory committee, who were present for the committee's discussion of ethylene oxide, will be available to the chairmen if further clarification is needed, the Chartered SAB agreed in a voice vote.
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McConnell Seeks Vote Before August Recess On Measure to Revise Toxic Substances Law
Jun 9, 2015 | BNA Daily Environment Report
By David Schultz
Senate Majority Leader Mitch McConnell (R-Ky.) said he hopes to bring legislation revising the Toxic Substances Control Act (S. 697) to the floor this summer.
In an interview published June 7 by the digital news outlet “Morning Consult,” McConnell cited the legislation as one of a number of measures with bipartisan support for which he would like to hold a vote before the Senate's August recess.
But McConnell said a Supreme Court decision invalidating parts of the Affordable Care Act would require the Senate to respond immediately and would force him to scrap his summer plans.
McConnell's office confirmed to Bloomberg BNA that the leader would like to take up the toxic substances bill this summer.
On June 5, the Congressional Budget Office released an estimate of how much it would cost to implement the bill.
It determined that the Environmental Protection Agency would incur $72 million during the next five years to bring the legislation into effect, but that this would be offset by the $80 million in new fees it would collect during this period.
The legislation would be the first major overhaul of TSCA in nearly 40 years. The Senate Environment and Public Works Committee approved the bill April 28 on a 15-5 vote while the House Energy and Commerce Committee unanimously approved a companion bill June 3 (82 DEN A-9, 4/29/15; 107 DEN A-16, 6/4/15). Normal 0 false false false EN-US X-NONE HE /* Style Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-parent:""; mso-padding-alt:0in 5.4pt 0in 5.4pt; mso-para-margin-top:0in; mso-para-margin-right:0in; mso-para-margin-bottom:8.0pt; mso-para-margin-left:0in; line-height:107%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:"Calibri",sans-serif; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin;}
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Pallone Seeks Balance Between Deal-Making, Party Messaging
Jun 9, 2015 | Roll Call
By Emma Dumain
Several months after winning a competitive race to be ranking member of the Energy and Commerce Committee, Rep. Frank Pallone Jr. wants to downplay the drama.
The New Jersey Democrat said last year’s “showdown” with Rep. Anna G. Eshoo, the California Democrat with whom he shares a corridor in the Cannon House Office Building and whom he calls a friend, wasn’t nearly as bruising as outsiders perceived it.
“I never thought it was bitter because I don’t think it ever got personal, you know? … I don’t want to say it was easy,” he said, “but I think it really kind of was easy.”
Half a year into his tenure as the panel’s top Democrat, the 63-year-old lawmaker says he doesn’t feel a need to blaze new trails on a committee where his two immediate predecessors, retired Democratic Reps. Henry A. Waxman and John D. Dingell, left indelible marks on policy.
“I like to think I’m following in Henry and John’s footsteps,” Pallone said. “There are times when I will say to myself, ‘What would they have done? And let’s not do anything differently, you know, if we can avoid it.’”
And his stated top goal as a leader on the committee — defending the 2010 health care law against Republican attacks, a mission of every loyal Democrat — is hardly revelatory.
It may be that Pallone, elected ranking member by only 10 votes, feels he still has something to prove to fellow Democrats.
But the low-key lawmaker is beginning to carve out a unique legacy for himself as a bipartisan deal-maker and partisan fighter.
He sat down recently with CQ Roll Call in his Cannon Building office to talk about his first 100-plus days on the job. Against the backdrop of an impressive floor-to-ceiling collection of Native American pottery — amassed during years of working on American-Indian affairs — and a single poster of Garden State hero Bruce Springsteen, Pallone said things were “going pretty well so far.”
He has some evidence to back that up.
Pallone helped Energy and Commerce Chairman Fred Upton, R-Mich., get members from both parties on board earlier this year with a legislative package to repeal the “sustainable growth rate” used to calculate doctor’s Medicare payments.
The two lawmakers followed up in mid-May with the long-anticipated 21st Century Cures Act to boost funding to streamline research and innovation for certain health treatments.
The committee markup was delayed over disagreements about offsets, but Upton worked with Pallone to incorporate Democratic priorities and the finished product was approved 51-0. One of the bill’s sponsors, Energy and Commerce Subcommittee on Health Chairman Joe Pitts, R-Pa., said he didn’t think he’d seen a unanimous vote on a major bill in 28 years.
The achievements have been good for Upton, who is working on cementing his own legacy during his last term as committee chairman. Upton said Pallone’s been a good partner so far, and attributes his counterpart’s cooperative spirit partly to his lack of ego.
“Henry was a former chairman,” Upton said of Waxman, Pallone’s immediate predecessor as Energy and Commerce’s most senior Democrat. “No one likes to move from chairman to ranking member. Nobody. I wouldn’t want to go back either. And so I guess it’s good for me that Frank has not been in that position.”
Geography also plays a part. Take a bill to overhaul the Toxic Substances Control Act.
In the 113th Congress, California Democrats were incensed over Republicans’ proposed rewrite of the decades-old law, arguing language would undermine existing state chemical and environmental safety regulations. Waxman was not a willing participant in moving the bill through the committee. Another California Democrat, Sen. Barbara Boxer, fought against the legislation as then-chairwoman of Environment and Public Works, ultimately undermining a deal negotiated by Sen. Frank R. Lautenberg, D-N.J., in the months before his death.
Pallone, not preoccupied by California concerns and perhaps even looking to finish what his late home-state senator started, worked with Upton last week to advance a new TSCA overhaul bill. The committee voted on the measure 47-0; Eshoo voted “present.”
Of course, this working relationship has also benefited Pallone, who’s shown he can not only get things done collaboratively, but also has the juice to facilitate deals Democrats feel good about supporting.
“If I just sit in this position and attack the Republicans, it doesn’t move the needle in terms of what I want to accomplish,” Pallone reflected, “so if I see an opportunity where I can work with them to actually move things in a pretty positive direction, I’m gonna take it.”
Still, Pallone acknowledged he feels compelled to rebut the other side frequently. A self-described progressive, Pallone says most Republicans “don’t really see a purpose in government,” whereas Democrats “are looking out for the little guy” — one of his most repeated phrases. As ranking member, he said, it’s crucial he take a stand for his party.
For all the committee’s bipartisanship this year, inter-party cooperation is still rare, he said, “The majority of things that come before the committee are issues where we can’t agree, where Republicans are trying to tear down government regulations and act on behalf of corporate interests.”
When Pallone campaigned for the ranking member job last year, he sold himself as a practiced messenger of Democratic talking points, having long served as the person responsible for lining up House Democrats to give “one-minute” speeches on the chamber floor.
He said he wanted to bring that sensitivity to his committee leadership role to help members translate complicated subject matter into powerful political arguments, especially in a presidential election year when legislation coming before the panel could resonate on the national stage, from health care to climate change.
“It’s a logical extension,” he said. “That is one of the things I said when I was running. I said, because I was the leader of the messaging group I would be in a better position to develop a message for the committee and the House.”
Making sure that process — thinking about how voters outside Washington perceive congressional Democrats — doesn’t get lost in the legislative grind is critical to Pallone.
“That’s a very important part of what I do.”
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(ACC Mentioned) Commentary: Amid A Benign US Economy, Beware A Shift In Global Consumption Trends
Jun 8, 2015 | ICIS News
By Joseph Chang
Amid a benign US economic environment, chemical sector production volumes are poised to grow faster than GDP, especially as new projects based on the shale gas competitive advantage ramp up in the coming years.
Despite the major decline in oil prices since Q4 2014, “the US chemical industry is still very competitive. Even with oil down around 50% from its highs, we are still seeing new project announcements,” said American Chemistry Council (ACC) chief economist Kevin Swift at the ACC annual meeting in Colorado Springs, Colorado, US.
There are 231 chemicals and polymers projects in the US based on shale gas totaling $142bn in investment, he noted. And much of the capacity of major new US plants is expected to be exported – as much as around 65%, said Swift.
The real growth in demand for petrochemicals such as methanol will be “away from the US, and exports will go to emerging markets such as China. A big chunk of the new [methanol] capacity will be export oriented,” said Mark Rohr, chairman and CEO of US-based Celanese, at the ACC meeting press conference.
“Basic chemicals will have to go to emerging economies. We are kind of saturated here,” he added.
American Chemistry Council
ACC CEO Cal Dooley addresses participants at the group’s annual meeting in Colorado SpringsProduction of US basic chemicals should grow by rates exceeding 5% in 2017-2019, up from 3.1% in 2015, said the ACC’s Swift.
Overall US chemicals production is expected to rise 3.2% in 2015 and 3.0% in 2016 based on the ACC’s Mid-Year Situation and Outlook report released at its annual meeting. “This is slightly down from ACC’s 2014 outlook as first quarter softness and the strong US dollar weigh on expectations,” said Swift.
Not all is coming up roses. On a global basis, the economic picture is mixed, with Europe on the mend while China remains mired in slow growth mode, and Brazil enters a recession.
“The US [economy] is steady but it certainly has not rebounded as much as we would have liked. In Europe, sentiment is better versus 2014, with customers more confident,” said Rohr. Automotive and coatings markets are particularly strong in Europe thus far in 2015, he noted.
But Asia “is a different story”. While China’s official GDP growth is around 7%, “we don’t even see 5% chemical growth,” said Rohr. “China started the year slow, and after Chinese New Year, it’s been steady but not very strong.”
And global consumption trends appear to be shifting – something that could cause chemicals and polymers growth to actually lag GDP.
The methanol product chain, in which US-based Celanese plays through its acetyls business, had been “classically growing at GDP, but it doesn’t appear to be growing as fast anymore. Basic chemistry is falling behind,” said Rohr.
“The correlation between global GDP and chemical sales had been strong. If China grew at 7-9%, we’d see 7-9% growth there. But that’s not happening today. The nature of demand has changed,” said Rohr.
“We are moving away from a consumptive trend. It may also be related to demographics,” he added. While this doesn’t appear to be impacting the US market, it is a trend “we need to be conscious of”.
As economies such as China’s evolve away from a goods-oriented, or export market, to one focused more on the domestic market with an inherently larger services component, that reduces the chemical content needed, said the ACC’s Swift.
And demographic headwinds are playing a part. “China’s working age population has peaked or will soon peak. Longer term, GDP growth could be more like 5-6%/year with 7% a good year for the Chinese economy,” said Swift.
“The US is not facing a demographic winter yet such as in Japan and Russia. We still have immigration. But still the labour force growth rate is not what it used to be,” he added.
A slowdown in global consumption of chemicals relative to GDP bears watching, especially in the face of massive capacity expansions in the US based on shale gas.
Even as the US will likely remain cost advantaged versus its global counterparts in the ethylene and methanol chains, the product will have to go somewhere – hopefully to places where there is robust demand growth.
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Fracking Associated With Smaller Babies
Jun 8, 2015 | The New York Times
By Nicholas Bakalar
A new study has found an association between hydraulic fracturing, or fracking, and smaller babies.
The scientists used data on 15,451 live births in southwest Pennsylvania from 2007 to 2010. They categorized the mothers by how close they lived to gas wells and the concentration of wells in the area.
Babies born in the highest exposure areas were not at higher risk of being born prematurely, but they were 34 percent more likely to be small for gestational age than those born in areas of least exposure.
The analysis, published in PLOS One, was observational and did not prove causality. The researchers controlled for mother’s age, race, prenatal care, smoking during pregnancy and other health and behavioral factors.
The reasons for the association are unclear, but the authors suggest that liquids used in the drilling may present a risk of air and water pollution.
“This isn’t enough to cause changes in policy,” said a co-author, Bruce R. Pitt, the chairman of the department of environmental and occupational health at the University of Pittsburgh Graduate School of Public Health. “It requires more intensive research, better measurements of exposure and medical outcomes. But it is enough to prompt further research so that we know how to go forward in a way compatible with public and environmental health.”
A spokesman for the Marcellus Shale Coalition, a trade industry group, said, “The researchers by their own admission rely heavily on two anti-oil and natural gas studies that have been thoroughly debunked. They admit that ‘a number of unknown factors limit the research.’ ”
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Is Our Drinking Water Safe From Fracking?
Jun 8, 2015 | The Washington Post
IN THE ongoing war over fracking, the loudest voices try their best to obscure this essential point: The controversial drilling technique doesn’t need to be banned; it needs to be well regulated. That’s how we explain the seemingly contradictory reaction to the Environmental Protection Agency’s assessment of fracking’s effects on drinking water, a draft report released last week that industry and environmental groups each spun to support its side. In fact, it supports neither side.
The EPA doesn’t pretend to have a final and precise answer on the scope of fracking’s impact on drinking water. There were sharp limits on its data. But the agency used 950 sources of information from government, industry and environmental groups, so their findings represent the best that science can offer right now. The conclusion: The EPA couldn’t find evidence that fracking has “led to widespread, systemic impacts on drinking water resources in the United States.”
The assessment continued, “The number of identified cases where drinking water resources were impacted are small relative to the number of hydraulically fracked wells.” Given the economic and environmental benefits of using domestically fracked natural gas — which produces less carbon dioxide than coal when burned — the arguments for fracking bans continue to look very weak.
But, the report goes on, there are several possible mechanisms of contamination that drillers and regulators need to treat with a healthy caution: “We found specific instances where one or more of these mechanisms led to impacts on drinking water resources, including contamination of drinking water wells.” Moreover, given the limitations of the available data, there might well have been instances of contamination that have been so far invisible to regulators.
Though the available evidence doesn’t justify banning the technique — as Maryland and New York have done — it clearly calls for sensibly regulating it. Properly cementing new wells is a must. Ensuring that blowout preventers, critical valves and other safety hardware are in good shape is, as well. Lining pits containing contaminated water can prevent seepage into groundwater. Taking care not to drill too close to another well, particularly old and rickety ones, can reduce the possibility of opening cracks in the subsurface geology that promote the movement of tainted water and chemicals.
Government officials need to pay attention to seemingly mundane considerations, too: Spillage from ancillary operations such as trucking wastewater to containment areas can affect drinking water if accidents happen in the wrong places. Promoting the reuse of fracking water would be a way for drought-prone states with significant fracking activity to conserve water for other uses.
Regulations can’t eliminate all the risks, even if the rules are enforced perfectly. Obtaining the energy that powers modern life is an enterprise with risk. But solid rules can acceptably minimize the risks of fracking.
We sympathize with those who argue that a broad shift toward renewable energy is the ultimate answer and that the sooner that happens, the better. But there will be a meantime in which the world transitions off fossil fuels and onto cleaner sources of energy. We will probably be in that meantime for many years — and while it lasts, well-regulated fracking shouldn’t be taken off the table.
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The Good, The Bad And The Ugly When Oil Giants Shift To Natural Gas
Jun 8, 2015 | Environmental Defense Fund
By Ben N. Ratner
Six large European oil and gas companies recently announced a commitment to engage on climate policy, calling for a price on carbon. The now-emerging picture of their coordinated corporate talking points, however, leaves no doubt that promotion of natural gas is a core part of the group’s position.
Is this development a beneficial push to help the planet transition to a low carbon economy – or just another marketing campaign? The truth, so far, lies somewhere in between.
Here are the good, the bad and the ugly highlights of what we’ve learned over the past week and what it all means. The good: Establishing a carbon price and cutting carbon dioxide emissions
Make no mistake about it: The world’s leading economies need to establish a price and limits on greenhouse gas emissions, and leadership from the private sector is instrumental in achieving that policy objective.
For large companies such as Shell, BP and Statoil to join forces and unequivocally state, as they now have, that a price on carbon should be a “key element” of climate policy frameworks is a refreshing boost to pre-Paris United Nations climate talks.
It is a potentially powerful validation that even some of the world’s largest corporate emitters see an upside to carbon pricing and will weigh in to make it a reality.
As to promoting natural gas a solution, it is well documented that in many cases natural gas will replace coal for power generation – a shift already underway in the United States and partly responsible for driving down carbon dioxide (CO2) emissions. The bad: Paying short shrift to natural gas’s Achilles heel
Notwithstanding the economic and carbon-dioxide benefits of coal-to-gas switching, there is a missing piece of the puzzle in the companies’ formulation to date.
One of the oil executives said “The enemy is coal.” Respectfully, that is incorrect. The enemy is climate pollution; coal is merely its most pernicious face.
Methane is natural gas’s Achilles heel. At close to 85 times more potent of a climate change forcer than carbon dioxide, methane emissions from the oil and gas industry undermine the very climate performance of natural gas that companies tout as a chief benefit relative to coal.
Indeed a recent report found that the 20-year global warming potential of methane emissions from the global oil and gas sector have the same near-term impact as about 40 percent of total CO2 emissions from global coal combustion in 2012. And that’s on top of the carbon dioxide from burning the natural gas.
Fortunately, the bad methane story can be solved at little economic cost, and while creating jobs in the process. If the companies put a fraction of the effort of promoting gas into promoting methane solutions – including the regulations we need to establish basic environmental safeguards – this bad news story could disappear.
A bold methane action plan that all companies embrace, and that includes strong regulatory assurances, is the missing ingredient – the elephant in the room. The ugly: A leadership shortage
But we have a problem.
American companies (think Chevron and Exxon) are among the most well-resourced and inventive oil and gas companies. With a large stake in natural gas, they share an interest with European corporate peers when it comes to promoting a carbon price that displaces coal and resolving the methane issue before it gets worse.
However, these “super majors” have remained conspicuously on the sidelines of the European companies’ efforts. They’re even signaling an intent to stay there even as peers move closer toward embracing a lower carbon future
It is a missed leadership opportunity, but one they can still seize.
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Key Industry Meetings Explore Electric Reliability Concerns
Jun 8, 2015 | E&E News PM
By Emily Holden and Rod Kuckro
With the Clean Power Plan under final review at the White House, electric industry conferences this week will focus on how states can implement the draft rule without jeopardizing electric reliability.
In New Orleans, the utility trade group, the Edison Electric Institute, is holding its annual convention, which includes a panel about how the draft rule's interim goals beginning in 2020 could affect the grid.
The panel today, deemed "Untying the Gordian Knot: Complying with the EPA Clean Power Plan," features DTE Energy CEO Gerry Anderson, Great Plains Energy CEO Terry Bassham, Environmental Council of the States Executive Director Alexandra Dunn, Colorado Public Utilities Commission Chairman Joshua Epel and North American Electric Reliability Corporation Senior Vice President Janet Sena. The talk will "explore the major issues with the proposal and potential paths forward," according to EEI's agenda.
EnergyWire's Joel Kirkland and Rod Kuckro will cover the convention.
In Milwaukee this week, the Mid-America Regulatory Conference -- an association of energy regulators from 14 states -- also holds its annual meeting.
Speakers include EPA air chief Janet McCabe and Federal Energy Regulatory Commission member Colette Honorable, as well as state officials and energy company executives from the member states: Arkansas, Kansas, Illinois, Indiana, Iowa, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma, South Dakota, Texas and Wisconsin.
Go to E&E's Power Plan Hub to read more and to see news and documents related to the latest Clean Power Plan developments.
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House Panel To Mark Up Forestry, Power Line And Pipeline Bills
Jun 9, 2015 | E&E Daily News
By Phil Taylor
The House Natural Resources Committee tomorrow will mark up bills allowing quicker approval of logging projects that reduce wildfire threats in national forests -- part of a broader GOP push to slash environmental red tape.
The committee will also vote on bills to allow the Interior Department to approve gas pipelines through national parks and to incentivize production of soda ash from federal lands.
The markup will feature seven bills altogether, five of which involve energy and natural resources.
A key bill is H.R. 2647 by Rep. Bruce Westerman (R-Ark.), which would allow federal agencies to perform shorter National Environmental Policy Act reviews for logging projects that reduce wildfire risks, increase forest resilience to insects and disease, protect water supplies or enhance habitat for at-risk species.
The bill -- part of a broader GOP push to expedite the thinning of federal forests that have become overgrown and susceptible to fire -- picked up tepid support from Forest Service Chief Tom Tidwell at a hearing last week, though the Obama administration and dozens of conservation groups have raised a host of concerns (E&E Daily, June 4).
It is co-sponsored by Reps. Glenn Thompson (R-Pa.), Ryan Zinke (R-Mont.) and Ann Kirkpatrick (D-Ariz.).
The 44-page bill would seek to incentivize collaborative forest planning and would place new financial burdens on groups that sue to block logging projects.
The bill says that for any forest management activity that is developed through a collaborative process or is proposed by a resource advisory committee or covered by a community wildfire protection plan, an environmental assessment or environmental impact statement shall only contain an "action" and "no action" alternative, which appears aimed at reducing the length and cost of NEPA reviews.
In addition, the bill would allow a so-called categorical exclusion for certain projects up to 15,000 acres, set deadlines for the Forest Service to replant and cultivate trees on a burned landscape, and would require groups that sue to block collaboratively planned forest projects to post a bond to cover the government's anticipated legal costs, among many other provisions.
Tidwell said he was encouraged that the bill, in contrast to past GOP measures, does not set mandatory logging levels and would incentivize a robust public debate over forest management.
But Democrats on the committee said the bill erodes NEPA, could allow for broad clearcuts and sets too low a bar for "collaboration."
And both Tidwell and Democrats argued that additional streamlining authority will have limited effect unless the Forest Service is allowed access to disaster funding to fight wildfires, which would protect funding to improve forest health.
The panel will also vote on H.R. 2358, by Zinke and co-sponsored by Rep. Kurt Schrader (D-Ore.), to improve the maintenance of utility corridors through federal forestlands.
The bill, a draft version of which was backed in May by power company officials, seeks to reduce the threat of trees toppling onto power lines and causing electricity outages and wildfires by allowing utilities quicker access to remove hazard trees.
It would also relieve utilities of potentially costly liabilities for wildfires if the federal government failed to allow the utility to manage vegetation that caused a wildfire.
A federal witness last month raised concerns over provisions that he argued limit the Forest Service's management discretion, impose "unreasonable" review deadlines and eliminate liability for power lines -- a "high-risk" use on public lands. Democrats on the panel argued that federal approvals could be expedited if Congress increased funding for the agencies or passed legislation to prevent fire borrowing.
Also on the docket is H.R. 2295, by Reps. Tom MacArthur (R-N.J.) and Cedric Richmond (D-La.), which would amend the Mineral Leasing Act to authorize the secretary of the Interior to approve gas pipelines through national parks without Congress' approval and allow the Interior secretary to designate National Energy Security Corridors for the purpose of issuing streamlined permits for rights of way.
Republicans last month joined union leaders and pipeline developers in backing the bill, arguing it is needed to ensure that pipelines carrying growing sources of shale gas can reach states facing high electricity prices. But the measure took fire from an Obama administration official and environmental groups including the Southern Environmental Law Center.
Members will also vote on California Republican Rep. Paul Cook's H.R. 1992, which would lower the royalty rate for mining soda ash from 4 percent to 2 percent. The material is used to make a host of products like glass and detergents. And lawmakers want to help U.S. producers compete with China.
Congress lowered the royalty rate from 6 percent to 2 percent between 2006 and 2011. A deal in 2013 set it at the current 4 percent for two years. Inaction before the end of the year would cause it to bounce back to 6 percent.
The Obama administration has questioned whether the reduction has made a difference in mining, but a bipartisan group of lawmakers from both sides of the aisle supports the legislation. They include Reps. Cynthia Lummis (R-Wyo.), Suzanne Bonamici (D-Ore.), Jim Himes (D-Conn.), Kurt Schrader (R-Ore.) and David Valadao (R-Calif.).
The other bill up for a vote is H.R. 1289, by Rep. Mark DeSaulnier (D-Calif.), to allow Interior to acquire, by donation, approximately 44 acres to include in the John Muir National Historic Site in Martinez, Calif.
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GOPer Pledges $175 Million To Push Party On Climate
Jun 8, 2015 | PoliticoPro
By Darren Goode
A Republican entrepreneur is putting a whopping $175 million behind a campaign whose message will have some party stalwarts seeing red: The GOP needs to deal with climate change.
North Carolina businessman Jay Faison will launch a social media and online advertising blitz, backed by state and national digital advocacy efforts and a series of strategic grants as part of a $165 million campaign run through his ClearPath foundation. The aim is to get the Republican Party to shift its skeptical view of climate change and green energy, topics that usually fall to the bottom of its list of priorities when they don’t generate outright opposition among conservative voters.
In addition to his public education effort, Faison is putting another $10 million of his money into a separate political advocacy operation, using the same nonprofit tax status designation as groups like President Barack Obama’s Organizing for Action, Karl Rove’s Crossroads GPS and several tea party groups. He will also try to attract additional outside funds for that operation.
On Tuesday, Faison, who made a fortune from the sale of his Charlotte-based audio-visual equipment company SnapAV, will unveil the first stage of his ClearPath campaign, including spending $40 million through 2016 alone to convince moderates and conservatives to join the fight against climate change — but relying on market-based principles rather than government mandates.
“I always felt a little alone out there as a Republican and so I started ClearPath to create a dialogue around this in a way that hadn’t been done before and sort of be part of the solution,” Faison said in an interview, adding he’d like to see the party’s candidates debate the solutions to climate change, not the science. “We think that there are real Republican solutions to the problem.”
It’s not an issue that tends to sit well with Republican leaders. Among the GOP candidates for president, only longshot Sen. Lindsey Graham (R-S.C.) has been consistent in saying that he believed human activity was a cause of climate change. He’s vowed to try to convince Republicans to expand the party’s environmental platform, but he’s currently polling in the low single digits.
Green-minded Republicans may gravitate toward Jeb Bush, who will make his own candidacy official June 15 and has acknowledged climate change as a problem. But he has also echoed conservatives in decrying the “arrogance” of those who say climate science is settled.
The challenge for Faison will be finding a receptive audience inside the party that has focused on fighting Democrats’ climate change policies or rallying voters against what it calls President Barack Obama’s “war on coal.”
“What’s important to remember is that [climate change] doesn’t really register as an issue with many Republican primary voters,” said Eli Lehrer, who helped form the free-market think tank R Street Institute after bolting from the Heartland Institute’s public skepticism of climate science.
“It isn’t that they are denying anything. They just don’t care that much. I don’t care that much. It’s unlikely that I will vote primarily where someone stands on climate change,” he said.
Faison said he’s trying to change that perception — or at least not let Republican apathy about climate change stand in the way of getting the party to join the debate over solutions that has been dominated by Democrats. And that means focusing on solutions in the free market that will appeal to conservatives.
“I think everybody agrees that there’s [climate] risk. And if there is risk then I think we need to move on to solutions which are right in front of our nose,” he said.
A self-described Christian conservative from a prominent Charlotte Republican family, Faison also supports school choice, tort reform and small government, and he’s got disdain for Obamacare — all positions that put him solidly in the Republican camp and refute claims that he’s a RINO (Republican In Name Only) because of his climate outreach.
But as an avid hunter and fisherman, he’d long followed climate change issues, and after the sale of his company, Faison decided to turn his attention to the effort.
Tuesday will mark the official rollout of ClearPath.org — a website featuring hundreds of pages of studies and other data including from the National Oceanic and Atmospheric Administration, NASA, Massachusetts Institute of Technology and the corporate consulting firm McKinsey to educate Republicans about climate change. The ClearPath foundation also has an investment portfolio that includes a seven-figure solar energy investment.
There is a wealth of polling suggesting a lot of Republicans do see climate change as a problem that should be addressed through cleaner forms of energy, if not EPA and other regulations.
“There’s a lot of center-right Republicans that feel like they don’t have a voice in this issue, and surveys would say they’re eager to share this information to bring other people along with them,” Faison said. “Even in small percentages, that’s in the millions.”
Yet, conservatives remain an outlier. An Earth Day-timed Gallup poll found fewer than four in 10 self-identified conservative Republicans — 37 percent — think that climate change will occur in their lifetimes, while 19 percent believe it will affect future generations. A plurality — 40 percent — responded that climate change will never happen.
Faison advocates for preventing utility monopolies from standing in the way of rooftop solar and other green electricity sources, rather than relying on measures such as the Obama administration’s planned greenhouse gas controls for power plants. Rooftop solar has been championed by tea party groups in Georgia, but it’s an effort that will put him in conflict with megadonors like the Koch brothers.
Indeed, the trend among Faison and other green Republicans is to showcase ideas that are already or should be pretty well established within the GOP policy framework.
“The problem with Republicans — a lot of Republicans, not all — they just don’t understand the issue,” said Andrew Sabin, owner of a New York-based precious-metal refining business and a longtime GOP donor. “If they saw some of the things they could do that wouldn’t affect the economy and in fact increases jobs and cleans the air, they’re all for it.”
Sabin has pitched GOP presidential candidates on the need to invest in new nuclear plants, wind and solar power, an updated power grid and more research on capturing carbon and storing it — as well the need to confront the changing climate and rising sea levels.
And though the candidates he’s spoken to have more or less been receptive, Sabin said that doesn’t mean it will translate to anything more.
“You don’t know as a donor whether they really agree or are just patronizing you,” said Sabin, who plans to meet with Carly Fiorina this week.
Faison will target his efforts to local markets and specific demographics, such as Catholics and politically active Floridians, by using advertising, social media and new outlets. And ClearPath will use digital engagement tools to generate feedback from its audience, and put money into grants and think tanks such as the Niskanen Center and R Street.
But breaking through the noise won’t be easy. On the left, Tom Steyer’s NextGen Climate public education campaign has poured money into an operation against Republicans in a bid to elect more green Democrats into office. And the hundreds of millions of dollars flowing from the Koch brothers still attracts Republican candidates looking to shore up their conservative street cred.
Only 18 percent of probable Iowa Republican caucus participants believe GOP presidential candidates should “spend a lot of time talking about” climate change, according to a poll conducted late last month by Bloomberg Politics and the Des Moines Register. The next lowest issue polled was income inequality, at 36 percent.
But if a major candidate can put environmental issues on the radar, it could resonate particularly with younger voters in the party, and Sabin is hopeful that Bush can ultimately carve out a Teddy Roosevelt-type position that could broaden the GOP’s base.
“If Jeb Bush comes out with a good environmental policy he’s going to attract young Republicans for sure, and across the aisle to Democrats and Independents it’s going to be a huge help,” Sabin said. “If he’s our candidate, there is no Democrat in this country who would touch him if he had a good environmental plan.”
That emphasis on winning more of the youth vote through a green energy strategy is also the goal Young Conservatives for Energy Reform, founded by Michele Combs, a veteran Republican operative and daughter of Christian Coalition President Roberta Combs.
“I see the tide turning,” Combs said recently. “The young people and the young generation, they want this issue and they understand this issue.”
Faison has so far has donated $50,000 to Bush’s Right to Rise PAC, and $25,000 to Graham’s campaign. But he hasn’t picked which candidate he intends to back yet.
“This is an issue that … they haven’t clearly articulated yet,” he said.
Bush has acknowledged that the climate is changing, but has said the science is unclear on what is causing it and that the issue isn’t the highest priority for him. He’s been critical of Obama’s regulatory efforts to use the Clean Air Act to tighten emissions.
Sabin, a friend of the Bush family, may be a notable exception among Republicans donors in openly pressing for his environmental priorities, but his efforts may encourage other party funders, who may have been quietly working for greener policies.
“There are a very small handful,” said Rob Sisson, president of ConservAmerica, formerly Republicans for Environmental Protection. “If they decide to come together, it could attract others that we either have not had contact yet or not on the radar screen yet.”
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Southern California Air Quality Officials Adopt Stricter Toxic Air Rules
Jun 9, 2015 | BNA Daily Environment Report
By Carolyn Whetzel
An estimated 87 facilities in Southern California could face stricter requirements for emitting toxic air contaminants under rules the South Coast Air Quality Management District has updated to reflect the state's new risk assessment guidelines for air toxic hot spots.
Approved June 5 by the SCAQMD governing board, the revised rules could cost businesses as much as $1.9 million a year to complete new health risk assessments, notify the public of potential exposure risks and cut emissions enough to reduce harm to children and other vulnerable populations.
California's Office of Environmental Health Hazard Assessment approved the new health risk assessment guidelines in March, incorporating new scientific information about the health risks to early-life exposures to air toxics. Under OEHHA's new risk calculation methodology, the cancer risk of exposure is nearly three times more than in the prior guidelines.
Even though toxic emissions from an individual facility may not have increased, the new guidelines require new health risk assessments required under state law and the SCAQMD to include the revised methodology.
The SCAQMD is the first of the state's regional air quality agencies to update local air toxic rules.
Notification Concerns
Throughout the rulemaking process, businesses in the region expressed concern about how the new risk assessment procedures would be communicated to the public, largely through the public notifications required under state and the SCAQMD rules.
While facility emissions have stayed at or below levels previously considered protective enough, new risk assessments and notifications could raise concern that air toxic emissions have increased, businesses said in written comments.
A report the SCAQMD released in 2014 showed the cancer risk from exposure to air pollution in the Los Angeles basin decreased more than 50 percent between 2005 and 2012 (193 DEN A-16, 10/6/14).
The SCAQMD agreed to work with businesses to draft the public notices to guard against any misunderstandings for the new procedures.
At the public hearing at SCAQMD headquarters, Natural Resources Defense Council attorney David Pettit supported the revised rules and also supported the business community's call to carefully communicate the reasons for the updates.
“This is a new technical way of looking at the health risks” of air toxics and not an indication that emissions of air toxics have increased, he said.
Oil refiners, aerospace manufacturing plants, metal plating and finishing operation, and wastewater treatment plants are among the types of facilities affected by the updated rules, according to the SCAQMD.
Paint spray booths and retail gasoline stations are regulated under the air toxic rules, but the SCAQMD decided to wait to set new health risk thresholds for those facilities until a later date.
Develop Health Risk Assessments
The air district said as many as 87 of the 400 facilities regulated by the rules could have to develop new health risk assessments, and 42 companies may have to issue new public notices under the revised rules. An estimated 22 businesses may have to reduce emissions to stay beneath the health risk thresholds by changing processes, adding on controls or altering through-put limits, the SCAQMD said.
At issue are four measures: Rule 1401, New Source Review of Toxic Air Contaminants; Rule 1401.1, Requirements for New & Relocated Facilities Near Schools; Rule 1402, Control of Toxic Air Contaminants From Existing Sources; and Rule 212, Standards for Approving Permits & Issuing Public Notice.
The rules target emissions of dozens of air toxics including benzene, hexavalent chromium, lead, nickel, dioxins, formaldehyde and cadmium in the urban areas of Los Angeles, Riverside, Orange and San Bernardino counties and all of Orange County.
California's Air Toxic Hot Spots program requires facilities to submit a quadrennial toxic inventories and develop health risk assessments.
The SCAQMD rules establish cancer and non-cancer health risk requirements, including strict controls for new and modified facilities. Under the rules, a facility must notify neighbors and hold public meetings if its cancer risk exceeds 10 in 1 million cases during a 30 year period. Once the risk increases to 25 in 1 million, emissions of air toxics must be reduced.
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Carbon Tax Or Cap-And-Trade: Which Would Work Better?
Jun 8, 2015 | The Washington Post
By Jared Bernstein
Which is a better policy for reducing greenhouse gases: a tax on carbon or a cap-and-trade approach?
Given today’s gridlocked politics, I realize that’s a little bit like asking: Do you like your unicorns to be striped or polka-dotted? But as the Times pointed out:
This week, the top executives of six large European oil and gas companies called for a tax on carbon emissions. These companies — the BG Group, BP, Eni, Royal Dutch Shell, Statoil and Total — are not taking a bold environmental stand. They are being pragmatic. They want an efficient and predictable policy to limit greenhouse gas emissions because they realize something must be done.
Good for them, and while U.S. energy producers such as Exxon Mobil are conspicuously absent, some have apparently said they could live with a carbon tax if it could be offset by lowering other taxes they face. On the other hand, the fact that the politically powerful Koch Industries opposes any new price on carbon takes us pretty quickly back to the unicorn discussion.
But let’s put the politics aside for a moment and get our wonk on around this question of if — I’d say “when,” though probably not for a long while — we eventually make a move in this direction, what’s the best way to do so?
The Times editorial interprets the European companies as calling for a carbon tax, but as I read their statement, they broadly endorse “carbon pricing systems.”
Two approaches to such systems typically involve either a tax on carbon production and/or use, or a system of permits, in which fossil-fuel-based energy producers are either given or sold (at auction) numerical allowances of greenhouse gas emissions that they can buy or sell to one another. (Since we’re talking taxes, I don’t discuss a third approach: regulatory restrictions such as requiring a certain share of energy production to come from renewable sources by a future date.)
A primary advantage of the capped approach is that at least on paper, it limits carbon pollution to an established level, one that can be adjusted down over time as energy producers implement the required efficiencies. And while both approaches provide monetary incentives to conserve, under cap-and-trade, producers who’ve moved early to adopt carbon-capture technologies can make serious money selling permits to laggards.
Conversely, under the carbon tax, as Peter Barnes points out in his excellent new book (a must read that recommends a “cap-and-dividend” program, where the revenue is distributed equally to the public), we can’t know what we’ll end up with in terms of carbon reduction. If (after-tax) energy prices fall, as gas prices have in recent months, or technology achieves significant efficiency increases (e.g., if cars and trucks improve their mpg), even in the presence of a new tax, consumers may demand more energy and carbon-based energy consumption could increase.
So cap-and-trade is the way to go, right?
Not so fast. It’s no slam dunk, and I’d ecstatically take either one. But while in theory the cap is attractive, in the real world, I like the tax better. The problem is the interaction of complexity and political, and thus carbon, leakage.
There are a couple of design issues around capped plans that, given the sway of energy producers, could easily bounce the wrong way. First, initial permits can be either sold or given to polluters. Obviously, they’d like to get them for free, but that’s a huge giveaway — more corporate welfare to an already highly profitable industry. As Barnes puts it, selling the permits “should be a no-brainer, but there’s a political disadvantage: if permits are sold, they can’t be used as political bargaining chips. Hence the congressional bias to hand out permits in exchange for support from powerful industries.”
Second, and this problem is more pernicious, there are “offsets.” That’s where an energy producer can get a credit against their cap because they’ve allegedly reduced carbon-based emissions somewhere else in their operations. Again, this sounds reasonable on paper, but it can be easily gamed. For example, firm A, facing a carbon cap, can pay firm B to create a pollutant. Firm A then buys and destroys the newly created pollutant, getting credit for an offset and, thus, increasing, on net, carbon in the atmosphere.
So caps can be leaky and given away as political quid pro quos. What, other than the absence of a cap, can go wrong with a simple tax on carbon?
Well, one problem right in front of our faces is that Congress can set it too low, rendering it ineffective in a “Pigouvian” sense (a Pigouvian tax is a tax on activities with negative effects on society not reflected in the producer’s costs; it’s thus a tax designed to internalize a negative externality). The federal gas tax is very much a tax on carbon, and it’s been ridiculously stuck at about 18 cents/gallon since 1993.
Another problem, alluded to above, is that while industries may be making some better noises about taxing carbon, at least the American corporations are likely to insist on “revenue neutrality,” meaning cutting some other taxes in return for the new tax on carbon.
The problem with that idea, beside the fact that we need more revenue, is that we’d probably be trading a progressive tax — like the federal income or corporate tax — for a regressive one. Since low-income households spend a larger share of their income on energy, carbon taxes are regressive.
That’s why smart plans would both set the tax at a level that bites and include a rebate mechanism for the least well off (or, in Barnes world, for everyone).
I’m congenitally against complexity in the tax code and admit that it’s not optimal to have to create ways to offset this aspect of either approach. But as economist Chad Stone documents, this rebate mechanism is well worked out and has even found its way into various bills.
None of which have gone anywhere, which brings us back to the unicorn showroom. Figuring out which is a better way to tax GHG emissions is what we call a high-level problem, and I reiterate that I and many others, including apparently some large European energy producers, would be okay with either cap-and-trade or a carbon tax.
In other words, the barrier here is not the fine points of tax wonkery. It’s politics, and that’s a much higher bar to clear.
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Senate Secret Science Bill to Cost EPA $250M Yearly to Implement, CBO Estimates
Jun 9, 2015 | BNA Daily Environment Report
By David Schultz
The Congressional Budget Office is standing by its earlier estimates that legislation to add new requirements on the scientific studies that may be used by the Environmental Protection Agency would cost the agency $250 million a year to implement.
The CBO released on June 5 a cost estimate of the Senate version of the legislation (S. 544), which echoed the findings of an earlier estimate of a House bill that supporters of the bill had criticized.
The Senate bill, called the Secret Science Reform Act, is nearly identical to the House legislation.
It would require the EPA to rely only on studies with publicly available data when making most decisions. The agency would not be able to consider studies for which the published data are insufficient for “independent analysis and substantial reproduction of research results,” according to the bill language.
The House and Senate bills include a measure that would require the agency to implement the new requirements using no more than $1 million annually. However, the CBO's March 11 analysis of the House bill found that implementation would actually cost 250 times more (50 DEN A-5, 3/16/15).
Rep. Lamar Smith (R-Texas), who heads the House Science, Space and Technology Committee and introduced the bill, disputed the CBO estimate and said it was based on a “misunderstanding” of the bill's intent.
The House passed the bill March 18 on a 241-175 vote. An amendment from Rep. Donna Edwards (D-Md.) that would have provided the EPA with $250 million annually through the 2019 fiscal year to implement it failed (53 DEN A-6, 3/19/15).
The White House has threatened to veto the legislation if it clears Congress.
CBO Provides More Information
In its analysis of the Senate bill, the CBO provided more information about what those extra costs would be. To comply with the bill if it becomes law, the CBO said, the EPA would have to obtain the data used in a study, review it for confidentiality concerns, reformat it, gain access to the computer codes and models used to generate it and develop descriptions for how to access it.
However, the office of Sen. John Barrasso (R-Wyo.), who introduced the Senate bill, said the CBO is wrong on this point.
The bill “does not require the EPA to collect new data—it simply mandates that they use data that is thoroughly tested and publicly available,” Laura Mengelkamp, Barrasso's press secretary, told Bloomberg BNA in an e-mail. “Since this process is consistent with the data access requirements of major scientific journals and the promises of this administration, the EPA should have no problem complying with it.”
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House Members Urge Moniz To Revise Furnace Rule
Jun 9, 2015 | E&E Daily News
By Nick Juliano
More than 120 House members, primarily Republicans, are asking Energy Secretary Ernest Moniz to reconsider a recently proposed rule to boost the efficiency of natural gas furnaces.
In a letter yesterday, the members warned that the proposed rule would increase costs for some homeowners and could lead them to switch to less expensive electric models that produce more greenhouse gas emissions when it comes time to replace their furnaces. Rep. Mo Brooks (R-Ala.) led the letter, which was co-signed by 116 fellow Republicans and four Democrats.
The Department of Energy earlier this year proposed boosting the efficiency standards for indoor furnaces from 80 to 92 percent, drawing quick ire from trade associations representing gas utilities, as well as appliance manufacturers (E&ENews PM, March 27). Critics say the rule would effectively bar homeowners from installing new "non-condensing" furnaces, meaning consumers in warmer parts of the country would be unable to recoup their investment in new condensing gas furnaces, leading them to switch to electric models. The lawmakers' letter echoes those criticisms and points to DOE's estimate that 31 percent of consumers in the South would experience a "'net cost' (versus a net benefit)" over the life of the system.
"By setting a nationwide energy efficiency standard that precludes a consumer from choosing to install a non-condensing furnace, DOE will be forcing many homeowners either to abandon the use of natural gas to heat their homes or pay substantially more for the installation of a furnace that meets the new standard," the lawmakers wrote.
"We strongly encourage DOE to avoid such an 'either-or' approach to furnace efficiency, by establishing separate product classes for condensing and non-condensing furnaces, each with its own efficiency standard," they added.
Draft energy legislation being considered by the House Energy and Commerce Committee would force DOE to redo the furnace rule, but that provision quickly drew criticism from committee Democrats. Energy and Power Subcommittee Chairman Ed Whitfield (R-Ky.) was among those who signed onto Brooks' letter.
Industry sources have described the language as a placeholder and are negotiating a compromise with efficiency stakeholders and lawmakers on both sides of the aisle, with the goal of reaching an agreement that could be included in the larger, bipartisan energy bill that committee leaders hope to bring to the floor this summer (E&E Daily, June 2).
The four Democrats who co-signed Brooks' letter criticizing the rule were Reps. Marc Veasey and Henry Cuellar of Texas, Jim Costa of California, and Sanford Bishop of Georgia. None is a member of the Energy Committee.
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Calif Issues New Air Quality Rules After Cancer Study
Jun 8, 2015 | The Hill - E2 Wire
By Devin Henry
A new air quality rule will require some southern California industrial facilities to reduce toxic emissions or notify the public of the health risks from them.
California’s South Coast Air Quality Management District board approved the new rules Friday after state officials issued guidelines saying the cancer risk from toxic chemicals is almost three times higher than what was previously thought, the Los Angeles Times reports. Under the rules, industrial facilities that emit air pollutants like arsenic are required to notify the public if their facility’s cancer risk is deemed to exceed 10 in 1 million (which means the facility’s pollution could result in 10 cancer cases per 1 million people every 30 years). If the risk is 25 in 1 million, the facility owners must take steps to reduce emissions.
The air quality district’s rules cover 400 facilities in southern California counties around Los Angeles.
The new rule means 42 facilities will have to issue public notices about their pollutants and 22 will have to cut emissions. Another 87 will complete new health assessments. The total cost to businesses is about $1.9 million a year.
Businesses had opposed the new rule, arguing that the air quality board should reduce its requirements to help area businesses instead. An industry group said in February that regulators should “avoid unnecessarily alarming the public while harming local businesses and our economy.”
State regulators issued new air quality guidelines after studies showed pollutants had higher health risks to children and infants. More than 30 other California clean air boards are considering changing pollution rules to fit the new requirements.
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No State Consensus on Best Way to Handle Particulate Precursors Under 2012 Standards
Jun 9, 2015 | BNA Daily Environment Report
By Patrick Ambrosio
State environmental agencies are split over how best to demonstrate that control of precursor emissions is not necessary for an area to attain the current national ambient air quality standards for fine particulate matter, comments submitted to the Environmental Protection Agency show.
While several state and local agencies recommended that the EPA codify all three proposed precursor demonstration methods in order to provide states with maximum flexibility, other state agencies expressed a preference for the EPA to establish a single test for assessing the regulation of sulfur dioxide, nitrogen oxides, volatile organic compounds and ammonia under the fine particulate standards.
The three precursor demonstration options were included in the EPA's proposed implementation rule (RIN 2060-AQ48) for the fine particulate matter standards, which outlines various requirements for state and local agencies tasked with implementing the 2012 revised annual, health-based standard for fine particulate matter of 12 micrograms per cubic meter. The proposed rule, released in March, also would revoke the 1997 primary annual standard and establish new source review permitting and other requirements for the fine particulate standards (80 Fed. Reg. 15,340; 49 DEN A-1, 3/13/15).
The EPA has not yet announced a time frame for issuing the final implementation rule. The date for the final rule is listed as “to be determined” in the agency's spring 2015 regulatory agenda.
Need for Flexibility Cited
The EPA proposal requested state input on three potential approaches for assessing the effects of individual fine particulate matter precursors and determining whether areas would be required to control emissions of those precursors. The three options are:
• the use of two independent analyses—an attainment planning analysis showing control measures are not needed for expeditious attainment and a technical demonstration under Section 189(e) of the Clean Air Act showing that major stationary sources of the particulate precursor do not contribute significantly to levels that exceed the fine particulate standards (option one);
• a single analysis demonstrating that all emissions of a particular precursor do not significantly contribute to fine particulate matter levels that exceed the standards (option two); and
• an attainment planning analysis for all sources that would show control measures are not needed for expeditious attainment and that would serve as a Section 189(e) technical demonstration (option three).
Several agencies urged the EPA to offer the maximum flexibility and discretion to states to address precursor emissions. The San Joaquin Valley Air Pollution Control District said in comments that it supports the flexibility offered by each of the three approaches and urged the agency to include all three options in the final implementation rule.
“Providing states and air districts with multiple approaches allows EPA to account fro the distinctiveness of each state and even for regions within a state,” Seyed Sadredin, executive director of the San Joaquin Valley Air Pollution Control District, said.
Sadredin noted that for the San Joaquin Valley, past analysis has shown that reducing emissions of ammonia is an ineffective strategy for reducing ambient concentrations of fine particulate matter in the area.
The Nevada Division of Environmental Protection and the Alabama Department of Environmental Management also offered support for adopting all three options in the final rule. Alabama said in comments that the agency also should allow “any other analysis” that sufficiently demonstrates that control of a particular pollutant is not needed to attain the fine particulate standards.
The West Virginia Department of Environmental Protection voiced support for state flexibility but expressed concerns with all three proposed precursor options. The state agency said that because each nonattainment area is unique, the EPA should not be prescriptive on the precursor issue. Instead, the agency should provide states with examples of acceptable elements to include in a precursor demonstration, West Virginia suggested.
Some States Support Single Method
Several states expressed a clear preference for a single method for determining whether specific fine particulate precursors could be exempted from control requirements.
The Alaska Department of Environmental Conservation said in comments that it supports the approach using an attainment planning analysis that also meets Section 189(e) technical demonstration requirements (option three). That method would allow for the exclusion of particulate precursors based on existing modeling work, while the other two options would require additional modeling work that could be costly and time consuming, the Alaska agency said.
The Utah Division of Air Quality agreed that option three would be the best approach, while the Georgia Department of Natural Resources identified option two as the most appropriate method.
New Mexico Says Proposal Too Complicated
The New Mexico Environment Department used its comments to criticize the EPA for proposing an “overwhelming amount of options and scenarios” that complicated the process.
Richard Goodyear, chief of the air quality division in the New Mexico Environment Department, highlighted the EPA's proposal on the treatment of precursors, which asked for comments on three different potential options, how those options would apply to three different nonattainment scenarios and whether combinations of the options should be used. The New Mexico Environment Department prefers flexibility in proposed rules, but Goodyear said the options in the proposal posed challenges to state officials charged with commenting.
“The overwhelming multiplicity of options provided by EPA under the proposed implementation rule made it very difficult to analyze and provide comprehensive comments when there are countless scenarios that could apply,” Goodyear said. “The proposed implementation rule does not provide states with flexibility, but rather a puzzle of options that the states are left to figure out how to put together.”
Goodyear suggested that in the future, the EPA work with states and other interested parties to resolve some issues before a proposal is issued.
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Supreme Court Denies Alaska Railroad, Coal Companies' Seward Permit Shield Petition
Jun 9, 2015 | BNA Daily Environment Report
By Lars-Eric Hedberg
The U.S. Supreme Court denied June 8 a petition to review whether a Clean Water Act permit shield covers pieces of coal that fall off a conveyer system at a coal export facility and spill into Alaska's Resurrection Bay (Aurora Energy Servs. LLC v. Alaska Cmty. Action on Toxics, U.S., No. 14-1060, cert. denied, 6/8/15).
The court's denial of the petition filed by Aurora Energy Services LLC and the Alaska Railroad Corp. lets stand a September 2014 ruling by the U.S. Court of Appeals for the Ninth Circuit that these discharges are not covered by the general permit and therefore not shielded from liability.
The “express terms of the General Permit prohibit defendants' non-stormwater coal discharges,” the appeals court wrote.
In December 2009, the Alaska Chapter of the Sierra Club and Alaska Community Action on Toxics sued the companies under the Clean Water Act's citizen enforcement provisions, alleging that the non-stormwater coal discharges violated the general permit.
In a June 8 statement released by Sierra Club, advocates said they were not surprised by the Supreme Court's decision.
“Now we would like to see Aurora Energy and Alaska Railroad focus their efforts on protecting community and environmental health by preventing pollution into Resurrection Bay and harmful coal dust emissions,” Pamela Miller, executive director of Alaska Community Action on Toxics, said.
Companies: EPA Aware of Discharges
Trains from mining sites dump piles of coal at the railroad's Seward coal export facility. A conveyor moves this coal onto ships for delivery, but pieces fall off the conveyor and loading area into the bay, according to filings.
The companies argued in their March 2 petition that they complied with a multi-sector general permit for stormwater discharges associated with industrial activity at the facility and such compliance shields them from liability related to alleged violations (43 DEN A-18, 3/5/15).
Moreover, the Environmental Protection Agency, which issued the general permit in 2009, has “known that coal occasionally spills from the conveyor” since 1987, according to the companies.
Unlike an individual permit, the EPA or permitting agency issues a general permit for a specific class of dischargers who agree to comply with its terms.
The companies also contended that the Ninth Circuit's decision conflicts with those from the Second, Fourth and Sixth Circuits, effectively holding that “if a pollutant is known to the permitting authority, a discharge that includes this pollutant is protected by the permit shield, even if it is not among those catalogued in the permit.”
They asked the Supreme Court the following question: “Does the statutory permit shield protect a permittee from liability under the Clean Water Act for a discharge where the permitting agency was aware of the discharge at the time it approved the permit, and did not include any specific prohibition or limitation on the discharge in the permit?”
Groups: Ninth Circuit Ruled Correctly
The environmental groups argued in their reply brief that the Ninth Circuit correctly ruled that the general permit prohibits discharges of non-stormwater coal pollutants from the conveyor and ship loader (Alaska Cmty. Action on Toxics v. Aurora Energy Servs., LLC, 765 F.3d 1169, 79 ERC 1001, 2014 BL 244533 (9th Cir. 2014)).
Specifically, the groups said that the plain language of the permit “prohibits all but a limited, enumerated list of non-stormwater discharges,” and coal discharges do not appear on this list.
The groups also urged that the Ninth Circuit's approach—“looking first to prohibitory language in the permit before moving on, only if necessary, to apply the permit shield analysis”—was consistent with approaches taken by other courts of appeal.
As to the EPA's purported knowledge of the coal discharges, they contended that “[a]t no point in its communications with the EPA did the facility disclose its non-stormwater coal discharges from the conveyor or ship loader or inquire whether those non-stormwater discharges would be authorized under the general stormwater permit.”
The district court granted summary judgment in March 2013 in favor of the companies on the unpermitted discharge issue before the Ninth Circuit's reversal (Alaska Cmty. Action on Toxics v. Aurora Energy Servs., LLC, 940 F. Supp. 2d 1005 (D. Alaska 2013)).
John Martin, Clifton Elgarten, Susan Mathiascheck and Providence Spina of Crowell & Moring LLP, Washington, D.C., represent Aurora Energy Services LLC.
Jeffrey Feldman, Denise Ashbaugh and Ralph Palumbo of Summit Law Group, Seattle, represent the Alaska Railroad Corp.
Brian Litmans of Trustees for Alaska, Anchorage, and Peter M. Morgan, Denver, and Aaron Isherwood, San Francisco, of the Sierra Club represent the groups.
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Wastewater Utilities Warn EPA's Delay Of 'Needs' Survey Undermines SRF
Jun 8, 2015 | InsideEPA
By David LaRoss
Wastewater utilities are warning that EPA's long delay in updating its 2008 survey of water infrastructure "needs" is undermining the agency's clean water state revolving fund (SRF) that pays for infrastructure upgrades, because the years-old survey likely understates the level of funding needed compared to the pending 2012 version of the study.
"From a utility perspective, you're between a rock and hard place -- on the one hand you want the updated numbers that are likely to show a greater need than in the past, but you don't want a survey to come out that's not completely representative," says one wastewater industry source. The sector relies on the clean water SRF for funding that supports building or repairing infrastructure such as new sewer pipes or treatment facilities. Funds for those projects are separate from the drinking water SRF.
Both accounts provide funding for water system upgrades but use different formulas to allocate funds. President Obama in recent years has proposed significant cuts in the accounts, but Congress has rejected them.
The clean water SRF is currently funded at $1.5 billion and Obama has proposed to cut that level to $1.16 billion in fiscal year 2016. Congress is working on EPA's FY16 funding bills, and stakeholders say the agency is unlikely to release its delayed 2012 survey of state wastewater infrastructure needs before lawmakers over those measures. Observers suggest the extended delay of the study is in part because the agency is still crafting its recommendations for reworking the equations that dictate states' SRF allocations in response to a Congressional mandate.
A new formula giving the survey more weight would not only change the context of the survey but exacerbate any complications that would result if the survey data turns out to be flawed -- which sources believe is likely.
Under the Clean Water Act (CWA), EPA and states must submit data to the Clean Water Needs Survey (CWNS) every four years to gather data on publicly owned treatment works, stormwater and combined sewer overflow facilities, nonpoint source pollution control projects and decentralized wastewater management. The survey asks states to estimate their financial needs to address water quality projects, including the population their facilities serve and their current nonpoint source pollution control best management practices, according to EPA's website.
States finished their data collection and entry for the 2012 survey that year and EPA was due to report to Congress on results this spring -- a state source says "March" had been the target. But the agency says the survey is still in the interagency review process at the White House Office of Management and Budget (OMB).
Legislators use the survey's national-level data to gauge the need for overall infrastructure spending, but without a final 2012 report they have been left to apply the last published study, which uses 2008 data.
"What they want to know is, what's the degree of the need. And you don't want something out that they're relying on that doesn't fully address what the need is," the wastewater industry source says.
But a state source says legislators are unlikely to underestimate the need for SRF spending thanks to widespread debate over the "gap" between and spending and need for repair and replacement decaying drinking water, wastewater and other infrastructure, which is generally estimated at over $500 billion.
"Everyone's gotten to the point where there's all this analysis out there pegging the national gap in funding at hundreds of billions of dollars. I sort of feel like the numbers are so big that they're not really waiting on the need survey to demonstrate that," says a source at the Association of Clean Water Agencies (ACWA), which represents state water regulators.
However, the source continues that a new survey showing increased need from the 2008 figures could give appropriators more incentive to bolster infrastructure spending.
"It could be valuable just to give them a sense that it continues to grow, and that the current approach, in terms of making sure there's enough money to deal with the gap, isn't working," the source says.
Pending Survey
Even though stakeholders are looking for release of the 2012 version of the study, they suspect the data in the pending survey is flawed because states have little incentive to ensure its completeness. EPA and OMB could be delaying the CWNS release to verify and supplement state submissions, the observer says.
"There's a questioning of the value of the need survey -- not the value of the data but the comprehensive nature of the data. What we don't want to have happen is that because people aren't filling it out accurately, it shows a flat or decreasing need," the industry source says.
The formula EPA uses to divide available grant and loan funding in the clean water SRF gives little weight to CWNS results, which the industry source says in turn means states face no loss of funding or other penalties if their survey data is incomplete. Without an incentive for states to ensure reliable data, sources say, utilities and other stakeholders are concerned that some responses may not cover all of a state's infrastructure needs.
Moreover, EPA is preparing a report where it will recommend potential changes to the clean water SRF formula, to be delivered to Congress this fall under a mandate in the 2014 Water Resources Reform and Development Act (WRRDA). If it seeks to rework the formula to put more emphasis on the CWNS, it could exacerbate any flaws in the 2012 document, according to observers.
Industry is pressing the agency to make such a recommendation. Wastewater groups have long sought an SRF formula that places more weight on CWNS results -- similar to the allocation of drinking water SRF loans, which follows a formula that relies strongly on results of that industry's need survey.
"We would like to see EPA recommend when it puts together that study that we do it the way the drinking water sector does it, but of course if they do that you don't want to start off with a study that may not be complete. I think they're trying to make sure it [the 2012 CWNS] is going to be accurate," the wastewater industry source says.
Funding Mechanisms
In addition to concerns over how the CWNS data could affect SRF disbursements, state groups such as ACWA are wary of the possibility that the SRFs will be undercut by new financial mechanisms such as the Water Infrastructure Finance Innovation Act (WIFIA).
One state source says some are raising concerns that EPA could use the CWNS data to justify replacing some SRF funding with loans under WIFIA. WIFIA was also enacted in the 2014 WRRDA along with EPA's pending CWNS report and would provide low-interest federal loans and loan guarantees for up to 49 percent of water infrastructure and water reuse projects.
State groups have since shifted their focus to urging lawmakers to preserve states' role in the funding process and have asked Congress to refrain from appropriating additional funding for WIFIA in FY16 beyond the administrative funds already allocated. A state source says that although the CWNS survey is typically linked, in state SRF program managers' current thinking, to the SRF program, nothing precludes its results from also being looked at in possible WIFIA allocation decisions: "any unfunded needs" are addressed in the survey, the source says.
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9th Circuit Appears Ready To Endorse New NEPA Climate Standing Test
Jun 8, 2015 | InsideEPA
By Dawn Reeves
A three-judge panel of the U.S. Court of Appeals for the 9th Circuit appears likely to expand a precedent that allows environmentalists and other plaintiffs to cite local harms from federally approved projects to win standing when challenging the adequacy of agency consideration of climate impacts under National Environmental Policy Act (NEPA) reviews.
If environmentalists succeed in winning the argument in the pending case, Montana Environmental Information Center (MEIC) v. Bureau of Land Management (BLM), it would open the door to a slew of new climate-related challenges to government decisions in the resource-rich West.
Two of the three judges hearing the case indicated during June 2 oral arguments that the environmental groups have adequately shown they have standing to challenge oil and gas lease sales in Montana by citing local harms.
Judge Diarmuid O'Scannlain said that two standing declarations by members of the environmental organizations that cited surface impacts as their injury seems to “be enough to get them standing. It doesn't entitle them to a judgment, but it gets them in the door.”
Also, Judge Margaret McKeown said that it is “frustrating and might be unfair from a legal perspective” but she agreed that MEIC appeared to have standing in the pending case.
The judges indicated that they were likely to remand the case back to the federal district court in Montana, which had earlier rejected environmentalists' standing on greenhouse gas (GHG) grounds, to sort out whether they could continue to challenge GHG-related impacts of the lease sales on the merits.
Environmentalists are urging the 9th Circuit to adopt the precedent first set in late 2013 by the U.S. Court of Appeals for the District of Columbia Circuit in Wildearth Guardians v. Jewell, which held that plaintiffs could show standing to challenge NEPA reviews on climate grounds by demonstrating local impacts from projects' other adverse impacts.
While the Obama administration initially opposed the argument, after the D.C. Circuit ruled, it dropped its opposition and is supporting environmentalists' arguments on this point in the 9th Circuit. However, the administration is urging the 9th Circuit not to grant standing in this case but instead remand the issue to the lower court to interpret under the new test.
During the June 2 arguments, Shiloh Hernandez, the attorney representing the environmental groups, urged the court to grant standing and remand the case to the lower court to address the merits.
But William Mercer, arguing on behalf of petroleum industry intervenors, urged the court to reject standing because he said the groups could not overcome the redressibility hurdle, since their merits claims all related to emissions of the GHG methane.
He said environmentalists cannot win standing based on only aesthetic concerns and then challenge the NEPA review based on GHGs, noting “redressibility isn't toothless” but is important in a case where the relief is different from what was pursued to establish standing. He also sought to distinguish the case from Wildearth Guardians.
However, the judges appeared to reject addressing merits issues in the procedural decisions.
Lower Court Consideration
Also Nicholas Dimascio, a Department of Justice (DOJ) attorney representing BLM, reiterated that the government agreed with the new standing test but disagreed that the groups could win standing here because it was unclear whether the specific surface harms cited are still applicable.
He said those issues would have to be sorted out by the lower court, and asked the appellate court to remand the standing issue to be decided based on the new D.C. Circuit test.
The government reversed course in a brief filed last June, which asked the court to remand the MEIC case “for further findings.” The government's position continued to be at odds with environmentalists who want the 9th Circuit to reverse the district court's ruling on standing and remand the NEPA review on the merits, setting a precedent that would allow them to bring similar NEPA GHG challenges there.
During the arguments, there was also some discussion about how the court should determine which lease sites are still active and relevant to the surface impact claims, or whether the lease sites cited in those claims are now moot because they are too far away from those impacted to bring local harms.
But the judges indicated those issues -- as part of the new test sought by BLM -- were separate from granting standing.
The environmentalists appear to be poised to win the standing precedent in the 9th Circuit due to their earlier decision to include potential adverse surface impacts as part of their standing claim in the original suit before the federal district court in a case that was filed before the D.C. Circuit ruled in Wildearth Guardians.
The Montana district court ruled against them in June 2013 and the appeal was filed Aug. 1. Neither BLM nor the industry intervenors objected to the surface impact standing argument, and the lower court did not address it.
Hernandez argued that was the group's primary argument at the lower court in addition to the global warming standing claims. He added it would “be unfair” to remand the issue to the lower court and let the opponents develop an argument against the surface impact standing position. He noted that environmentalists have dropped their standing arguments based on global warming impacts from the oil and gas drilling activity, and is basing standing on the “geographical nexus between its client members concrete interests and the location of challenged leases.”
He said their merits arguments remain focused on the GHG methane, and include that BLM did not consider adequate alternatives to capturing methane, it failed to complete a detailed environmental impact statement, and it didn't accurately assess the cumulative impacts of the surface disturbance of the leases. The groups do not have to show a nexus between the pollutant in its standing arguments and the pollutant in its merits arguments, he said, citing the Supreme Court's 1992 precedent in Lujan v. Defenders of Wildlife, though Judge A. Wallace Tashmia said there has to be “some nexus.”
Mercer, representing the industry groups, called the environmentalists' “procedural posturing” “very significant” and sought to show that all of their claims were over global climate change impacts, not local harms. He said if the court finds standing here it would allow any party to litigate climate change “merely by asserting there are surface impacts in order to achieve standing.”
D.C. Circuit 'Right'
But DOJ's Dimascio said in light of WildEarth Guardians “we do not contend they need to allege a climate change-related injury in order to have standing here. . . . We believe the D.C. Circuit got it right.”
However, he added that DOJ does not believe they established standing to seek all of the relief they want because they alleged surface injuries only at a few leased parcels, not all 166 leases at issue in the case. BLM is asking the court to remand the case back to the district court to analyze standing under the correct standard, including by addressing which leases remain live and whether the declarants' four-year-old claims have since been mooted. The groups lack standing at lease parcels where they did not allege surface injuries, he said.
However, Hernandez cited a 10th Circuit precedent that held a plaintiff “need not show he has traversed every square inch” of the land subject to litigation. It is enough that the clients have “traversed a portion” of the leased parcels, and that it is at the remedy stage where the court should carve out an appropriate response to the injury. He added that demonstrating mootness is a high bar that that the government must prove.
One environmentalist attorney following the case says it is “easy to get lost in the technical arguments” but that it “boils down to something simple. The administration agrees with us that methane pollution is caused by oil and natural gas drilling and fracking, and must be reduced to meet the Obama administration's” climate goals. BLM is expected to issue a draft oil and gas rule this fall but in the meantime it “should take immediate action to reduce methane pollution and waste from federal oil and gas development. . . . In order for groups like MEIC and others to help do this it is critical that we have standing. Otherwise, we are just continuing to kick the can down the road.”
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Republican Pours Money Into U.S. Climate, Clean Energy Foundation
Jun 8, 2015 | Reuters
By Timothy Gardner
A Republican businessman said on Monday he is pouring millions of dollars into a foundation that sees opportunities where the majority of his fellow party members do not: easing climate change and speeding the country's transition to clean energy.
Jay Faison of Charlotte, North Carolina, has given $165 million to Clearpath, his foundation dedicated to explaining to centrist Republicans climate science and business opportunities in solar and other forms of green energy. In addition, he is giving $10 million to a related political nonprofit to raise additional funds.
The foundation aims to move the Republicans away from the party line of raising doubts about the science of climate change.
"There's a lot of good solutions, but we are not going to get there if we keep arguing about the problem," said Faison, a founder of audio-visual system companies. ADVERTISING
The foundation has invested between $1 million and $9 million in three or four solar energy projects, he said. "We need more than twice the investment in clean energy than we are currently getting," he said about the country's power infrastructure, adding that the solar investments are a small part of what the foundation does.
Separately, Faison has also donated to Republicans Jeb Bush, former governor of Florida, and South Carolina Senator Lindsey Graham. Graham is seeking the presidency in 2016, and Bush is expected next week to declare his bid.
Bush said in New Hampshire last month that climate change is real, but added it is "arrogant" for people to say how much of it is man-made. Graham briefly supported a cap-and-trade bill in the Senate that later died in 2010, and calls for a debate on how to fight climate change without hurting the economy.
Faison joins a small but growing list of Republicans who see business opportunities in green energy. Debbie Dooley, a member of the so-called Green Tea Coalition, and former Congressman Barry Goldwater, Jr., have also led a conservative charge into solar power
While Clearpath.org, the foundation's website, explains why some major oil companies, including Exxon Mobil, ConocoPhillips, and Shell, add a carbon price into their evaluations of prospective projects, Faison stopped short of picking his favorite carbon pricing mechanism.
"There's a lot of options on the menu, and it's a little early to talk about which options are right," he said. "We want to elevate the discussion about those menu items."
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N.Y. Comptroller Requests Safety Information From Oil, Rail Companies
Jun 9, 2015 | BNA Daily Environment Report
By Gerald B. Silverman
New York State Comptroller Thomas P. DiNapoli (D) has sent letters to 14 oil and rail companies seeking information on the measures they are taking in response to recent accidents involving the transportation of crude oil by rail, the state official announced June 8.
DiNapoli, the sole trustee of New York's $183 billion pension fund, sent the letters as an investor concerned about potential future liabilities for injuries, damages or cleanup costs in connection with oil spills, he said.
In his letters, the comptroller cited a 2013 accident in Lác-Megantic, Quebec, a recent derailment in Heimdal, N.D. and “other derailments in the United States within recent years.”
Among the companies that have been contacted by DiNapoli are Exxon Mobil Corp., Hess Corp., CSX Corp. and ConocoPhillips Co.
“Recent rail accidents resulting in catastrophic losses from oil spills pose serious risks for the public, the environment and the companies involved,” DiNapoli said in a statement.
“We need to know what companies are doing to safeguard against future mishaps which can lead to serious legal liabilities for the companies,” he said. “As trustee of the state pension fund, I am concerned that future liability claims may harm the interests of the retirement system's members, retirees and beneficiaries.”
Rob Doolittle, a CSX spokesman, said the company “appreciates the continued attention that Comptroller DiNapoli and other New York State leaders are bringing to rail-safety related issues.”
“Safety is CSX's highest priority, as evidenced by the continuous training our employees receive, the more than $1 billion we invest annually in the maintenance of our infrastructure, and our ongoing sharing of information with first responders in the communities where we operate,” he told Bloomberg BNA in an e-mail. “We will respond directly to Comptroller DiNapoli's correspondence in the very near future.”
Daren Beaudo, a ConocoPhillips spokesman, told Bloomberg BNA, “We are reviewing the letter and will reply directly to the Comptroller's office.”
Kate Hudson, director of cross-watershed initiatives for Riverkeeper, applauded the comptroller for using the pension fund's “significant leverage” as a shareholder.
“The Comptroller has taken the action required to assure that it is the companies profiting from crude-oil transport and not state and local taxpayers who will bear the burden of a crude-oil disaster like the ones we have seen in the U.S. and Canada over the past two years since the Lác-Megantic tragedy,” Hudson told Bloomberg BNA in an e-mail. “This is a strategy we would urge other state pension funds to seriously consider.”
In his letters to oil companies such as Exxon Mobil, DiNapoli asked if the companies have taken steps to insure against liabilities that might result from accidents. DiNapoli also requested information on the maximum liability covered by any insurance policies or other hedges against losses.
In addition, DiNapoli asked these other questions:
• Does the company process crude oil before transport to reduce its flammability?
• Does the company maintain ownership of produced crude oil during transportation to refineries and end users?
• Does the company own or supply rail cars used in transporting crude oil?
In his letter to CSX, DiNapoli requested “an overall assessment of whether increased rail transport of petroleum crude oil has elevated financial risk for the company.” He also requested information on the company's policies and procedures for preventing accidents, steps taken to ensure against financial liability and steps taken to address safety concerns with the DOT-111 tank car.
In addition, DiNapoli is seeking information on inspections and repairs, emergency response plans and other policies and procedures.
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Canada to Expand Reporting of Incidents, Harmonizing Requirements With U.S.
Jun 9, 2015 | BNA Daily Environment Report
By Peter Menyasz
Canada is proposing expanding its reporting regime for incidents involving transportation of goods by all modes to include any releases that endanger or could endanger public safety and that harmonize Canada's reporting regime with that in the U.S.
Proposed amendments to the Transportation of Dangerous Goods Regulations would incorporate new security provisions, modify and expand existing reporting requirements, and specify the data that must to be made available for risk analysis, Transport Canada said June 6 in a regulatory impact analysis accompanying publication of the draft amendments in the Canada Gazette, Part I.
But the new reporting regime would provide threshold limits for dangerous goods that generally are transported in bulk, as well as exceptions for incidents that do not pose a widespread risk, according to the department. “The proposed amendment would allow Transport Canada to capture only the information regarding releases or anticipated releases that endanger, or could endanger public safety,” it said.
The draft amendments, which apply to all modes of transport—road, rail, air and sea—are open to public comment through July 6.
The proposed changes would align Canada's reporting practices with those in the U.S., the department said. The proposed criteria for reporting are aligned with the reportable incidents identified in paragraph 171.15(b) of the U.S. Code of Regulations 49, including death, injury and evacuation, Transport Canada said.
“Harmonizing common elements with reporting practices in the United States would facilitate the comparison of common data sets, allowing Canada and the United States to merge data sets based on those common elements to produce larger data sets for risk analysis. Canada would retain elements that are Canada-specific, but would harmonize reporting criteria where applicable,” it said.
Transport Canada added that the proposed amendments would not impose significant costs for industry, as initial reports of incidents involving dangerous goods transport do not entail any fees. Affected stakeholders support the changes and have been requesting them for a number of years to streamline the reporting process, according to the department.
New Requirements Expand Reporting
The proposed amendments would require reporting to the Canadian Transport Emergency Centre (CANUTEC) the release or the anticipated release of a dangerous good in transport in excess of a trace amount, Transport Canada said. The current reporting regime, based exclusively on the quantity of dangerous goods released, has been judged excessively permissive, with some relevant incidents not reported because they didn't meet a threshold, the department said.
The proposed amendments, however, would limit reporting to releases in quantities greater than 30 liters or 30 kilograms for dangerous goods in Packing Group III of various classes of goods: Class 3, flammable liquids; Class 4.1, flammable solids; Class 4.2, Substances Liable to Spontaneous Combustion; Class 4.3, Water-Reactive Substances; Class 5.1 Oxidizing Substances; Class 5.2 Organic Peroxides; Class 6.1, Toxic Substances; Class 8, Corrosives; and Class 9 Miscellaneous Products, Substances or Organisms.
“Since dangerous goods included in Packing Group III pose a lower risk in transport, the threshold aims to exclude the reporting of small releases or small anticipated releases resulting from routine operations involving pumps, compressors and connectors that connect and disconnect during the loading and unloading of dangerous goods,” the department said.
The proposed amendments also would exempt releases or anticipated releases that do not result in the death of a person; an evacuation of people; or the closure of a facility, road, main railway line, main waterway or runway, it said.
A report to CANUTEC would still be required in instances where a person sustains injuries requiring immediate medical treatment by a health-care provider; a container catches fire, ruptures or explodes; a release occurs as a result of venting a container; the center sill or stub sill of a tank car is cracked by at least 15 centimeters; or if a container's integrity is compromised, according to the department.
Proposed Reporting Changes
The draft regulatory amendments also include the following proposed changes:
• new requirements for the reporting of the loss or theft of dangerous goods and for unlawful interference with dangerous goods transport;
• measures to adopt the International Civil Aviation Organization's reporting requirements for dangerous goods transported by aircraft that are misdeclared or undeclared;
• addition of incidents involving road vehicles to the requirement for immediate reporting by telephone to CANUTEC and any other applicable organizations of an incident involving dangerous goods;
• changes to information requirements for follow-up reports required within 30 calendar days after a reportable incident;
• a new definition of “release” that addresses both accidental and voluntary releases, rather than only accidental releases as under the current regulations; and
• various technical amendments to correct inaccuracies and typographical errors.
The amendments follow up on the 2009 amendments to the Transportation of Dangerous Goods Act that, for the first time, specifically addressed security issues in addition to recommendations from a 2010 internal audit to improve the data collection process to increase risk analysis capacity, the department said. Normal 0 false false false EN-US X-NONE HE /* Style Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-parent:""; mso-padding-alt:0in 5.4pt 0in 5.4pt; mso-para-margin-top:0in; mso-para-margin-right:0in; mso-para-margin-bottom:8.0pt; mso-para-margin-left:0in; line-height:107%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:"Calibri",sans-serif; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin;}
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