US petchems, energy groups urge Senate to block EPA air rule

28 October 2010 22:57  [Source: ICIS news]

WASHINGTON (ICIS)--Petrochemical, energy, refining, agricultural and general business interests on Thursday called on Congress to quickly block plans by the Environmental Protection Agency (EPA) to begin regulating greenhouse gas emissions in January.

A coalition of manufacturing, mining and commercial groups asked bipartisan members of the Senate Appropriations Committee to include a funding restriction against the EPA plans in any spending bills that the panel is likely to take up in November.

Congress is in recess while House and Senate members are in their home districts campaigning for re-election ahead of the midterm vote scheduled for Tuesday, 2 November.

The 111th Congress will reconvene on 15 November for its final few weeks of business before the end of the year and the end of the 111th.  The post-election period of legislative work is called a “lame duck session” because many of the current House and Senate members would have been voted out of office in the 2 November vote.

In letters to Republican and Democrat members of the Appropriations Committee, the American Chemistry Council (ACC), the National Petrochemical & Refiners Association (NPRA) and the Society of Chemical Manufacturers and Affiliates (SOCMA) were joined by energy, steel, agriculture, mining, forestry, fertilizer groups and the US Chamber of Commerce in asking them to block EPA’s greenhouse gas regulations.

The Appropriations Committee could bar the agency from implementing its greenhouse gases rules by imposing a moratorium on federal funds for that programme.

Before recessing in advance of the elections, Congress passed a short-term spending bill, known as a continuing resolution, to allow federal operations beyond the 30 September end of the government’s fiscal year.

But that continuing resolution (CR) was set to expire on 3 December, and unless Congress acts in November to approve another short-term budget extension into January, the government would have to shut down in the first week of December.

“We strongly urge you to include the moratorium as the Senate considers an additional CR or an omnibus pending bill when Congress returns in November,” the trade associations said.

In a ruling it announced in December 2009, the EPA said it has authority under the Clean Air Act (CAA) to begin regulating and limiting emissions of carbon dioxide (CO2) and other greenhouse gases by electric utilities, manufacturing industries and almost any business, agricultural or commercial enterprise that involves combustion of fossil fuels, known in regulatory terms as “stationary sources”.

In May, the agency issued its so-called “tailoring rule”, saying it would restrict its initial emissions restrictions to utilities and large industrial facilities beginning 2 January 2011.

But the ACC, NPRA, SOCMA and other industry groups warned the senators that if the new emissions rules go into effect, they “will delay, shrink or cancel new construction and modifications of US facilities - investments critical to economic recovery and job creation”.

The EPA has itself conceded that its greenhouse gases rules likely would cause delays or cancellation of new construction or major industrial modifications because of an anticipated backlog of permit processing required by the regulations.

The industry, agriculture and commercial groups said that the looming threat of emissions requirements has already inhibited US business investment.

“Already, the confusion and uncertainty surrounding the new rules is having a chilling effect on US industries’ decisions about whether to make new investments,” the letter said.

The groups said that they support a funding restriction on the EPA’s stationary source rules, “and we strongly believe Congress must address the issue when it considers an additional CR or omnibus spending bill in November”.

Separately, there is a bill pending in the Senate that would bar EPA implementation of its greenhouse gases rule for two years to allow Congress time to draft a comprehensive climate bill.  However, the White House has indicated that President Barack Obama would veto such a measure.

In addition, there are several lawsuits pending in federal courts challenging the EPA’s authority to regulate greenhouse gases and its tailoring rule, but none of those cases is likely to reach resolution before the new year.

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By: Joe Kamalick
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