US refiners, petchems blast EPA on emissions rule

13 May 2010 23:42  [Source: ICIS news]

WASHINGTON (ICIS news)--US chemical and refining industry officials on Thursday were harshly critical of new federal plans to regulate greenhouse gas emissions at production sites, saying they may seek court action to block the federal effort.

The American Chemistry Council (ACC) said it was “extraordinarily concerned” about a rule issued earlier on Thursday by the Environmental Protection Agency (EPA) to impose reporting and compliance regulations for greenhouse gas emissions on major industrial facilities and electric utilities.

ACC president Cal Dooley warned that despite the EPA’s rule-making effort to initially limit its greenhouse gases requirements to large plants and structures, the regulation ultimately must encompass virtually all of the nation’s commercial, business and public sector activities.

“By 2016 as many as six million US sources of greenhouse gas emissions could be required to obtain a permit to build or modify facilities,” Dooley said.

“This would include many of America’s smallest sources, such as a new 100,000-square-foot hotel, a new restaurant, a major source that wants to add a gas furnace or space heater, a large commercial property with a $5,000 [€3,950] monthly gas bill and nearly every chemical facility in the country,” Dooley said.

He warned that the EPA action would chill business investment to build new or modify existing production facilities, even energy-efficiency changes that would have helped reduce emissions of greenhouse gases.

In its ruling announcement on Thursday, the EPA said that it had decided to require greenhouse gas (GHG) emissions reporting by any facility that produces at least 75,000 tonnes per year of any of six pollutants.

This part of the reporting rule would begin on 1 January 2011, applying only to facilities that already were required to obtain permits for previously regulated pollutants under the Clean Air Act (CAA).

In addition, beginning on 1 July 2011, any new facility that would emit at least 100,000 tonnes of greenhouse gases annually and any plant that undergoes modifications resulting in emissions of 75,000 tonnes would be required to report, the EPA said.

New facilities and modified operations meeting those threshold levels also would be required to demonstrate the use of best available control technologies (BACT) during construction or modification work to minimise GHG emissions.

The National Petrochemical & Refiners Association (NPRA) said the EPA has created a regulatory mess and charged that the environmental agency has overstepped its legal authority.

“EPA has adopted a tortured and legally unsupportable interpretation of the plain wording of the Clean Air Act in an effort to escape a regulatory train wreck of its own creation,” said NPRA general counsel Gregory Scott.

Scott was referring to the EPA’s attempt to limit its greenhouse gas regulation to major factories, utilities and refineries by setting (“tailoring”) the reporting and compliance threshold at 75,000 tonnes of emissions annually, while the Clean Air Act specifies a threshold of as little as 250 tonnes for pollution emissions subject to EPA controls.

The EPA has conceded that if it were to use the law’s 250-tonne threshold, as many as 6m US farms, laundries, restaurants, schools, apartment buildings, hospitals and other structures would be subject to the greenhouse gases regulation, an outcome that the agency itself termed “an absurd result”.

“If EPA is allowed to get away with this, it sets a dangerous precedent for unelected officials in federal agencies to change laws approved by the elected representatives of the American people,” Scott said.

Scott said the EPA unwisely chose to use the Clean Air Act as its authority to regulate greenhouse gases. “Now that EPA has started down this path, it does not have the right to pick and choose between portions of the law that fit its activist agenda and those that do not,” he said. “Only Congress can rewrite the Clean Air Act.”

ACC’s Dooley said the EPA ruling will chill business investment across the country due to uncertainty over litigation, the ability of state governments to review and issue related permits, the need to amend states’ environmental laws to conform with the EPA rule and doubts about what emissions remediation measures EPA will find acceptable.

Dooley said the EPA’s rule-making demands urgent action by Congress to block the agency’s plans.

“We call on Congress to enact legislation to revisit this policy immediately,” he said, adding that industry is eager to work with legislators “in this urgent effort”.

There are already at least seven bills pending in Congress to block the EPA from regulating greenhouse gases.

NPRA’s Scott indicated his trade group may soon take action in federal court to block the EPA.

“We’re carefully reviewing the rule issued by EPA today and are considering all our options, including possible legal action, and we will announce our decision in a few weeks,” he said.

($1 = €0.79)

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By: Joe Kamalick
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