US chemicals officials call for wide-ranging rulemaking reform

14 July 2011 20:56  [Source: ICIS news]

WASHINGTON (ICIS)--US chemical industry officials on Thursday warned that federal and state regulations could threaten jobs and industry’s ability to compete globally, calling for a science-based review of a wide range of existing and pending rules.

Mike Walls, vice president for regulatory and technical affairs at the American Chemistry Council (ACC), told a press conference that “sound regulatory policies can help drive economic growth, but the reverse is also true”.

“With the US economic recovery slowing, it warrants a hard look at some of our national policies and the impact they have on job creation, jobs maintenance and the global competitive status of our industry,” he said.

As part of the council’s mid-year outlook, Walls cited as an example policies developing among some states that would put heavy restrictions on or even ban the use of hydraulic fracturing (fracking) in the recovery of newly abundant US supplies of shale gas.

Those fast-developing shale gas resources, described as game-changing by ACC chief economist Kevin Swift, have restored a feedstock cost advantage to US chemical producers in global competition.

Continued development of shale gas resources “should be a prominent part of our nation’s energy policy”, Walls said.

“We need to avoid policies that would impose unreasonable barriers to shale gas development and make it uneconomic to produce,” he added.

He said that ACC was not taking a position now on whether federal legislation might be needed to establish a nation-wide policy on fracking to avoid a rash of patchwork restrictions or bans at local levels.

Walls also repeated the council’s opposition to legislation pending in Congress, the NAT GAS Act, that would provide $5bn (€3.5bn) in subsidies for the production, sale and fuelling of autos and trucks running on natural gas instead of gasoline or diesel.

He said the bill was misguided, and according to one study, could cost taxpayers as much as $135,000 in subsidies for each natural gas vehicle.

Detailing other top ACC regulatory concerns, Walls said that federal policymakers should give more attention to and support for energy efficiency programmes, calling for energy efficiency to be classified as part of federal clean energy policy and definitions.

More broadly, Walls said that federal officials need to press ahead with regulatory reform to ensure that rulemaking is based on sound science and risk assessment, transparent processes and better analysis of the competitive impact of proposed and existing rules.

In particular, he cited what many in the chemical industry and among independent scientists regard as a flawed decision by the Health and Human Services Department (HHS) to classify styrene and formaldehyde as likely human carcinogens.

He said that ruling could jeopardize broad uses of the chemicals in life-saving and healthcare-related products.  He said the ruling “shows what happens when rulemaking undermines science”.

Walls also reiterated the council’s request to the Environmental Protection Agency (EPA) for reconsideration of the agency’s accelerated plans to tighten restrictions on ozone emissions nationwide, arguing that EPA has needlessly advanced changes in those standards that were not required until 2013.

He warned that if the EPA goes forward with new ozone limits, “Every area of the country would be in non-attainment [violation of the standards], and that would have major impact on manufacturing, tourism and state economies in general.”

He argued that the vast majority of manufacturers already have installed state-of-the-art ozone control technologies and that they could only meet the proposed standard by cutting production outright.

Citing opposition to the proposed EPA ozone rule among many in Congress, Walls said ACC is hopeful that the agency will reconsider its rule.

Walls also called for prompt congressional action to modernize the Toxic Substances Control Act (TSCA), the principal US law governing chemicals in commerce.

He said that a sound, science-based reform of the 35-year-old TSCA is necessary to restore public confidence in the EPA’s ability to assure the safety of chemicals in commerce and to thwart a growing trend among retailers to deselect products for non-scientific reasons.

However, Walls said that does not look likely that Congress will succeed in crafting a comprehensive reform of TSCA this year, and that the legislative process could run well into 2012 and perhaps even into 2013.

($1 = €0.71)

Paul Hodges studies key influencers shaping the chemical industry in Chemicals and the Economy

By: Joe Kamalick
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