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Commentary
The Obama Administration began a charm offensive this week, attempting to demonstrate the achievements and effectiveness of the Clean Air Act . . . Until now, a talking point for advocates of climate legislation has been that the Clean Air Act is the monster waiting to emerge if Congress fails to enact legislation. Now starts the pivot. At an event held this past week celebrating the 40th anniversary of the Clean Air Act, speakers lauded the health benefits and technology innovations resulting from implementation of the statute. They also dug through the history of the landmark 1990 amendments to learn what alchemy lead to an 89-10 vote in the Senate, and a 401-25 vote in the House . . . In her keynote address, EPA Administrator Lisa Jackson insisted that flexibility and efficiency will be the agency's touchstones for developing greenhouse gas regulations under the Act . . . So far, the Business Roundtable is not convinced. The group joined 24 other industry associations in a letter requesting that Congress pass a bill along the lines of the Rockefeller bill, i.e., a two year delay in any EPA regulation of stationary source GHG emissions . . . Sen. Rockefeller says he now has 53 votes in favor of his bill, and believes he can find seven more supporters . . . Some Democrats may now see the Rockefeller bill as a strategic alternative to a bill that would remove any funding for EPA to work on greenhouse gas policies . . . Industry petitioners also are seeking relief in the judicial branch, urging the D.C. Circuit to stay the EPA GHG rules until the court can reach a resolution on their validity.
Executive Branch
- Administrator Jackson Defends EPA, Sets Forth Principles for Clean Air Act Regulation. At a conference organized by the Environmental Protection Agency (EPA) and the Bipartisan Policy Center to celebrate the 40th anniversary of the Clean Air Act (CAA), EPA Administrator Lisa Jackson defended the agency's recent rulemakings on greenhouse gases (GHGs) and rebutted what she described as "wild projections of economic collapse" being circulated by lobbyists. Arguing that "the Clean Air Act does not require EPA to act in a reckless and irresponsible manner," Jackson outlined five principles that will guide EPA regulation under the CAA with respect to GHGs and conventional air pollutants. These five principles include: (1) promoting investment in energy efficiency and updated technologies; (2) addressing multiple pollutants at once through similar regulatory strategies; (3) setting clear and achievable standards while allowing flexibility as to the means of compliance; (4) seeking input from citizens, industry, and other affected stakeholders; and (5) focusing on the most cost-effective strategies by avoiding regulation of small businesses, nonprofit entities, and minor sources or industry sectors. Jackson noted that previous forecasts of "economic doom" resulting from CAA regulations had not come to pass – asserting that the CAA has dramatically reduced air pollution over the last forty years even as the overall economy has grown. She also claimed that CAA regulation has benefited the economy by yielding public health and welfare benefits valued at $40 for every $1 of regulatory expense, and by giving rise to job-creating industries in the field of environmentally friendly technologies. Speakers at the conference included John Rowe, Chairman and CEO of Exelon Corporation; former House Energy Subcommittee Chair and current Resources for the Future President Phil Sharp; Linda Fisher of DuPont Corporation; former Sen. John Warner (R-VA); and Rep. Henry Waxman (D-CA), Chairman of the House Energy and Commerce Committee. Jackson's keynote address can be viewed at http://www.ustream.tv/recorded/9567909.
- EPA Announces Changes to Voluntary GHG Programs. EPA announced significant developments in two of its leading voluntary GHG reduction programs. First, the agency announced that it will phase out its "Climate Leaders" program over the coming year, explaining that the program is being eclipsed by mandatory GHG regulation under the CAA. Launched in 2002 under the Bush Administration, Climate Leaders provided a public platform for companies to track GHG emissions on a voluntary basis and report progress in reducing emissions. Second, EPA announced that it will extend its "Methane to Markets" program for another five years. Methane to Markets encourages voluntary reductions in methane emissions in foreign countries. EPA's commitment to the program will be formalized at an October 1 meeting of representatives from 36 countries participating in the program.
- USDA Report Emphasizes Role of Agriculture and Forestry in Reducing GHG Emissions. A new report by the U.S. Department of Agriculture (USDA) estimates the role of the agriculture and forestry industries in sequestering U.S. GHG emissions and identifies options for further abatement in those sectors. According to the report, forest growth in the United States sequestered approximately 900 million tons of CO2 in 2007 (equivalent to approximately 13% of gross U.S. GHG emissions). Key opportunities identified in the report for improving GHG abatement in the agricultural and forestry sectors include changing livestock feeds to reduce methane emissions; installing methane digesters at livestock farms; switching to no-till agriculture; and switching from annual to perennial crops. Based on incentive payments made to farmers under the Conservation Reserve Program, the report estimated that a carbon price of at least $13 per ton of CO2 would be required to make afforestation and reforestation profitable in the East Coast and Gulf states. The report is available at http://www.ers.usda.gov/Publications/EB15/EB15.pdf.
- Cathy Zoi to Serve as Acting Under Secretary of Energy. The Department of Energy (DOE) announced that Cathy Zoi, who is currently Assistant Secretary of Energy for Energy Efficiency and Renewable Energy, will begin serving as Acting Under Secretary of Energy next month. Current Under Secretary of Energy Kristina Johnson will be stepping down to return to her academic career.
Congress
- Senate Postpones EPA Appropriations Vote, Averting Amendment on Delaying GHG Regulation. The Senate Appropriations Committee was scheduled to mark up the FY 2011 spending bill for EPA on Thursday, September 16, and committee members Sens. Mary Landrieu (D-LA) and Ben Nelson (D-NE) both told reporters they would consider voting for an amendment that would delay or remove EPA's authority to regulate GHG emissions under the Clean Air Act. The mark-up was delayed, reportedly because President Obama submitted a last-minute funding request related to reorganizing oversight of offshore oil drilling. In addition, Sen. Jay Rockefeller (D-WV) said that he had been told by other Democratic supporters on the committee that the appropriations bill was not the right vehicle for his efforts to delay EPA regulation of stationary source GHG emissions for two years. Senate Maj. Leader Harry Reid (D-NV) told reporters that he would bring the Rockefeller bill to the floor for a vote later this year. Sen. Rockefeller said that he has 53 votes for his bill, and that he believes he can convince another 7 senators to vote for passage, thereby achieving a filibuster-proof majority.
- Kerry Gives Up on Climate Bill in 2010. Sen. John Kerry (D-MA), co-sponsor of the Kerry-Lieberman climate bill, told reporters that "anything that's comprehensive or with a cap or anything like that is not going to pass right now." He also said: "I intend to stay front and center on an issue that I've been involved in for 23 years, 24 years – longer, even," and that he would see "what's possible" in the Senate next year.
Judicial
- Parties Challenging GHG Regulations File Motions for Stay. Four groups of petitioners seeking review of EPA's GHG rulemakings in the District of Columbia Circuit Court of Appeals have filed motions urging the court to stay the effectiveness of those regulations. A group of industry petitioners called for a stay of the impact of two EPA decisions on stationary sources: (1) the March 2010 interpretive rule concluding that GHGs will become regulated pollutants for purposes of PSD and Title V permitting on January 2, 2011, and (2) the June 2010 "Tailoring Rule" establishing a timetable and emission thresholds for phasing in permitting of large GHG sources under the PSD and Title V programs. The other three groups of petitioners – a coalition of conservative advocacy organizations, a group of governors and attorneys general from eight states, and 12 Republican Congressmen – requested a stay of those regulations and also a stay of the agency's vehicle GHG emission standards and December 2009 "endangerment finding," which are also under review in the litigation. The industry petitioners' motion is available online here.
States and Cities
- NACAA Report Concludes "Overwhelming Majority" of States Will Be Ready to Implement GHG Permitting. A report of the National Association of Clean Air Agencies (NACAA) concluded that nearly 80% of state and local permitting authorities expect to be ready to begin issuing Prevention of Significant Deterioration (PSD) and Title V permits for GHG emissions from large stationary sources on or soon after January 2, 2011 – the date that GHGs become regulated pollutants under the Clean Air Act. The report was based on a review of communications submitted by the states to EPA. Commenting on the report, NACAA Executive Director Bill Becker stated that "the overwhelming majority of states are moving full speed ahead to ensure that their permitting programs include greenhouse gases and exclude smaller sources . . . there is no reason to acquiesce to any political or other kind of delays that certain industry groups may be pursuing at the state or local level." In August of this year, EPA issued a proposed rulemaking finding that thirteen states will not be able to implement PSD permitting for GHG emissions under the timetable and emission thresholds provided in EPA's "Tailoring Rule." If finalized, that finding will require the states to amend their regulations to allow PSD permitting of GHGs, or allow EPA to assume responsibility for PSD permitting. It is not clear why the number of non-compliant states identified in the NACAA report differs slightly from EPA's proposed finding. The NACAA report is available online here.
- RGGI Allowances Go Unsold at Latest Auction As Prices Hit New Low. At an allowance auction held on the second anniversary of the Regional Greenhouse Gas Initiative (RGGI), only 75 percent of current-use allowances were sold. Although in several past auctions future-use allowances went unsold, this auction – the ninth in the RGGI history – marked the first time that allowances for immediate use remained unsold. Clearing prices also fell to a new low of $1.86, which is the minimum reserve price for RGGI allowances. Last week, RGGI also inaugurated a stakeholder process to review the program's design and evaluate options for the post-2012 period.
Industry and NGOs
- Business Roundtable Supports Rockefeller Bill to Delay EPA Regulation of GHGs. The Business Roundtable, an association of large businesses, sent a letter to Senate Majority Leader Harry Reid (D-NV) and Senate Minority Leader Mitch McConnell (R-KY) urging a vote on a bill sponsored by Sen. Jay Rockefeller (D-WV) to delay EPA regulation of stationary source GHG emissions for two years. The letter states that "the Clean Air Act is not well-designed to regulate ubiquitous pollutants like carbon dioxide emissions" and argues that EPA regulation "will only increase energy costs for U.S. companies" if not accompanied by legislation and international agreements. The letter also claims that a two year delay would offer Congress and the Executive Branch time to develop alternative approaches to addressing climate change, including the development of new technologies and promotion of energy efficiency. A similar letter sent to appropriators in both chambers of Congress and signed by 24 business associations – including the American Chemistry Council, the American Petroleum Institute, and the National Association of Manufacturers – also argues for a two year delay in issuing GHG regulations. The text of the Business Roundtable letter is available at http://blog.fortnightly.com/2010/09/15/aeps-morris-delay-epa-ghg-regs/. The text of the industry association letter is available at http://www.americanchemistry.com/s_acc/bin.asp?CID=217&DID=11344&DOC=FILE.PDF.
Studies and Reports
- Researchers Conduct High-Accuracy REDD Carbon Mapping at Low Cost. Research published in the Proceedings of the National Academies of Sciences mapped aboveground carbon stocks and emissions at .1-hectare (ha) resolution over 4.3 million ha of the Peruvian Amazon. The researchers used a combination of airborne light detection and ranging (LiDAR), satellite images, and field plots to derive high-accuracy carbon estimates at a cost of only $.08/ha, and concluded that costs could be reduced further. The researchers determined that their methods could be used to support efforts to Reduce Emissions from Deforestation and Forest Degradation (REDD). The study is available at www.pnas.org/cgi/doi/10.1073/pnas.1004875107.
- 2010 2nd Warmest Summer on Record. Scientists at the National Oceanic and Atmosphere Administration (NOAA) reported that the summer of 2010 was the second warmest summer on record, with combined land and ocean temperatures averaging 61.3 degrees Fahrenheit for the June-August period. 1998 was the warmest summer on record. The January to August 2010 period tied with 1998 as the warmest January to August period since data was first available in 1880. A recent report released by NOAA found that the past decade was the warmest on record. The report is available at http://www.noaanews.noaa.gov/stories2010/20100915_globalstats.html.
International
- India to Regulate Industrial Air Pollutants. India announced plans to regulate industrial air pollution by means of a national emissions trading program. The Indian government specified that GHG emissions would potentially be included in the scheme, along with sulfur dioxide, nitrogen oxides and particulate matter. Pilot projects are planned for the industrial states of Gujarat and Tamil Nadu.
- European Commission Proposes Modifications to Emissions Trading Scheme. The European Commission proposed incorporating land use, land use change and forestry (commonly referred to as "LULUCF") into the calculation for the European Union's GHG emissions reduction target of 20 percent below 1990 levels by 2020. This change could ease the pressure on the 164 industrial sectors and sub-sectors currently covered by the EU Emissions Trading Scheme (ETS) to reduce their emissions through 2020 to meet the overall EU target.
- UN Board Places Hold on Issuance of HFC-23 Credits. The Executive Board (Board) of the Clean Development Mechanism (CDM) has placed a hold on the issuance of certified emission reduction (CER) credits for projects that destroy emissions of HFC-23, a highly potent GHG. The Board's placement of a hold on HFC-23 credits follows its request this July that the CDM's methodologies panel investigate whether facilities that produce HCFC-22 have manipulated the CDM. Some NGOs have alleged that the facilities have been increasing their production beyond business-as-usual amounts in order to earn additional credits for destruction of HFC-23 emissions associated with HCFC-22 production. The hold will be in effect at least until the Board receives the results of the methodologies panel's investigation in late November. The CDM, one of three flexibility mechanisms under the Kyoto Protocol, allows industrialized nations to earn tradable credits by funding emission reduction projects in developing countries.
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