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As 2010 came to a close, EPA announced a timeline for proposing GHG performance standards for power plants and refineries . . . EPA also issued six notices and rules that cleared away obstacles to application of the Prevention of Significant Deterioration permitting obligations to stationary sources. Those obligations started on January 2 under the Tailoring Rule timetable . . . The State of Texas brought an action in the D.C. Circuit to forestall EPA's imposition of a federal PSD program in the state . . . The new Congress is readying initiatives to oversee, defund, delay, or remove EPA's authority to regulate GHG emissions from stationary sources. Republicans have the votes for such measures in the House. Can they attract moderate Democrats in the Senate to their side?

Executive Branch

  • EPA Announces Timeline for Issuing GHG Performance Standards for Power Plants, Refineries. In consent decrees resolving two lawsuits filed by states and environmental organizations, the Environmental Protection Agency (EPA) agreed to a timetable for promulgating New Source Performance Standards (NSPS) for greenhouse gas (GHG) emissions from power plants and petroleum refineries. Issued under Section 111 of the Clean Air Act, NSPS limit emissions of regulated pollutants from new and modified sources, and establish state-implemented guidelines for emissions from existing facilities. The consent decrees committed EPA to issue proposed NSPS for power plants by July 2011 that would be finalized by May 2012, and to issue proposed NSPS for refineries by December 2011 that would be finalized by November 2012. The consent decrees do not provide any detail as to the scope or stringency of the NSPS, but do require that emission guidelines for existing sources be promulgated at the same time as the standards for new and modified sources.
  • EPA Takes Final Procedural Steps to Regulate GHGs From Stationary Sources. On December 23, 2010, EPA issued six notices and rules that cleared the final procedural hurdles required to ensure that Prevention of Significant Deterioration (PSD) and Title V permitting of stationary GHG sources commenced on January 2, 2011, the date that GHGs became regulated pollutants under the Clean Air Act. EPA's administrative actions included:
    • A formal finding that seven states (Arkansas, Florida, Idaho, Kansas, Oregon, Wyoming, and most permitting authorities in Arizona) had failed to amend their Clean Air Act regulations (known as State Implementation Plans or SIPs) as required to allow permitting of GHG sources;
    • A rule providing for EPA-directed PSD and Title V permitting in those seven states to commence starting January 2, 2011, pursuant to a Federal Implementation Plan (FIP);
    • A separate "interim final" rule disapproving Texas' SIP and imposing a FIP for PSD and Title V permitting of GHG sources in Texas, along with a parallel proposed rule that is open to public comment; and
    • Two rules designed to ensure that SIPs in force in other states do not apply PSD permitting and Title V obligations to small sources of GHGs—consistent with the agency's June 2010 "Tailoring Rule."

The text of each of the above administrative actions is available at http://www.epa.gov/NSR/actions.html.

  • EPA Defers Reporting of Certain GHG-Related Data Under Reporting Rule. EPA announced on December 20 that it would allow facilities subject to reporting of GHG emissions under its Mandatory Reporting Rule to defer reporting certain operating characteristics used to compute GHG emissions until August 31, 2011. Currently, the rule requires this data to be submitted by March 31, 2011. The agency also issued a separate proposed rule that would extend the deadline for reporting this data until 2014. Some regulated companies have argued the data should be confidential because it represents business-sensitive, competitive information. Importantly, the deferrals apply only to data used as inputs to emission calculations; under EPA's announcement and the proposed rule, actual GHG emissions for 2010 would still have to be reported by March 31, 2011.
  • Pershing: 2011 Climate Negotiations to Focus on Implementation of Agreements. Jonathan Pershing, the U.S. Deputy Special Envoy for Climate Change, said that international climate change negotiations in 2011 would not involve any changes to "the basic pledges or the basic structure" of agreements reached at the 2010 meeting of the United Nations Framework Convention on Climate Change in Cancún, Mexico. Instead, Pershing said, negotiators will focus on implementing provisions of the key agreements reached in Cancún, particularly the establishment of a global fund to help developing countries adapt to the impacts of climate change. Pershing also noted that "the world will certainly be looking at us" and that the actions of the new Congress related to climate change "will matter a lot in the overall effectiveness of this effort to address climate change." Pershing also reiterated that the U.S. would not join any legally binding international treaties calling for GHG emission reductions unless major developing economies such as China, India, and Brazil are included.
  • Appointments. President Obama has appointed Nathaniel Keohane, currently Director of Economic Policy and Analysis at the Environmental Defense Fund, to serve as Special Assistant to the President for Energy and Environment. He replaces Joseph Aldy, who left the Administration to return to the faculty of Harvard University.

Congress

  • House Republicans Focus On EPA At Start Of 112th Congress. With the commencement of the 112th Congress, House Republicans wasted little time in beginning efforts to roll back recent actions by the Obama EPA. In particular, Republicans focused on preventing EPA from implementing new rules for regulating GHG emissions under the Clean Air Act.
    • Rep. Shelley Moore Capito (WV) introduced the Protect America's Energy and Manufacturing Jobs Act, which would delay any action by EPA to regulate GHG emissions from stationary sources for two years.
    • Rep. Ted Poe (TX) introduced the Ensuring Affordable Energy Act, which is aimed at cutting off funding for the implementation of EPA's GHG rules. The bill would prohibit EPA from using any funds to implement or enforce a cap-and-trade program, or any rules regulating GHG emissions from stationary sources.
    • House Republicans pledged to use resolutions passed under the Congressional Review Act (CRA) to attack recent EPA rulemakings. A CRA resolution allows Congress to disapprove of a final agency regulation within 60 legislative days of its promulgation. The disapproval vote only requires a majority vote in both chambers. The 60-day window means the CRA is not applicable to EPA rulemakings that have led to the Prevention of Significant Deterioration permitting obligations. However, Republicans are likely to rely on CRA resolutions to address any new GHG rules promulgated by EPA.
    • Another area of focus for House Republicans will be EPA funding. House Appropriations Committee Chairman Hal Rogers (KY) plans to introduce a rescission package that would limit EPA's ability to implement GHG and other rules by severely limiting the agency's funding.
    • Republicans also plan to attack EPA's rules by using their new authority to subject EPA actions, and broader climate change issues, to extensive oversight. The Oversight & Government Reform Committee, under the control of Chairman Darrell Issa (R-CA), and the House Energy & Commerce Committee, under Chairman Fred Upton (R-MI), are expected to begin oversight hearings as early as this month. House Science and Technology Committee Chairman Ralph Hall (R-TX) said his committee will hold hearings focusing on the quality of climate change science.
    • Although the substantial Republican majority in the House (242-193) means that the party's efforts are likely pass out of the Chamber with relative ease, the Senate remains under Democratic control and President Obama has said he will veto any efforts to limit EPA's GHG rulemaking. As a result, the ultimate impact of the numerous Republican efforts on EPA's regulatory authority remains uncertain.
  • Senate Democrats Stake Out Space in Debate on EPA GHG Rules. For their part, Senate Democrats used the start of the new Congressional session to take sides in what is sure to be an intense debate:
    • Senator Jay Rockefeller (D-WV) announced that he will continue his efforts to pass legislation that would impose a two-year delay on EPA authority to regulate GHG emissions. Sen. Rockefeller said that he will re-introduce a bill similar to one he offered during the 111th Congress with the goal of having the Senate vote on the bill before the current Continuing Resolution expires on March 4. Sen. Lisa Murkowski (R-AK) will likely co-sponsor the bill. In 2010, Sen. Rockefeller's delay proposal received support from six other Democrats.
    • Senator Sherrod Brown (D-OH) stated that he would support a one-year delay of the EPA GHG rules. Sen. Rockefeller expressed opposition to Sen. Brown's proposal.
    • Senator Barbara Boxer (D-CA), Chair of the Senate Environment and Public Works Committee, said that she is committed to defending the EPA's regulatory authority. Sen. Boxer also said that her Committee will not focus on cap-and-trade legislation, but will instead focus on pursuing other means of reducing national GHG emissions and ensuring that the Federal government does not stand in the way of state and regional efforts to regulate GHGs.

Judicial

  • D.C. Circuit Issues Emergency Stay Preventing EPA From Assuming GHG Permitting Role in Texas. In response to a motion filed by the state of Texas days before EPA was scheduled to take over the state's PSD permitting program for GHG sources, the United States Court of Appeals for the District of Columbia Circuit (D.C. Circuit) issued an emergency stay on December 30 preventing EPA from proceeding with its FIP. The court stated that it issued the emergency stay solely to allow an appellate panel to fully consider Texas' motion to stay the FIP, and was not intended as a ruling on the merits of the motion itself. Pursuant to court order, EPA filed a response to Texas' motion on January 6 claiming that the agency's decision to issue the FIP without opportunity for notice and comment was "for good cause." EPA's response notes that all other states have either consented to timely issuance of a FIP or amended their state regulations to enable PSD permitting of GHG sources in accordance with EPA regulations. Speedy implementation of the FIP was necessary, argues EPA, to ensure that GHG sources in Texas are able to obtain valid PSD permits now that GHGs are regulated pollutants under the Clean Air Act.
  • Supreme Court Denies Petition to Overturn Fifth Circuit Dismissal of Appeal in Climate Change Tort Case. On January 7, 2011, the Supreme Court denied a petition for a writ of mandamus in Comer v. Murphy Oil Co., a prominent climate change tort case. The petition was filed by the plaintiffs in September of last year, and sought a reversal of a May 2010 decision by the United States Court of Appeals for the Fifth Circuit determining that it could not review the case en banc because the recusal of multiple judges deprived the court of the necessary quorum. The Comer case originated with a complaint filed in 2005 by victims of Hurricane Katrina against a variety of energy companies and energy-intensive manufacturers, alleging that GHG emissions from the defendants' operations had exacerbated the destructive power of the hurricane. In 2007, the suit was dismissed in district court on the grounds that it presented a nonjusticiable "political question." Although a three-judge panel of the Fifth Circuit initially ruled in favor of the plaintiffs in October 2009, the Fifth Circuit's subsequent decision on the quorum issue both vacated the panel's opinion and allowed the district court's dismissal of the case to remain in effect. As a result of the Supreme Court's decision, the district court's dismissal will stand undisturbed.

States and Cities

  • Massachusetts Climate Plan Establishes 2020 Emissions Target. Massachusetts Energy and Environmental Affairs Secretary Ian Bowles released a "Clean Energy and Climate Change Plan for 2020" that includes a goal of reducing the state's emissions to 25 percent below 1990 levels by 2020. The plan describes a portfolio of new and existing clean energy and energy efficiency policies in the building, electricity and transportation sectors that will be relied on to achieve the emissions goal. Existing policies, including participation in the Regional Greenhouse Gas Initiative (RGGI) and a renewable energy credit program, will account for the bulk of the reductions. Among the new policies called for by the plan are a clean energy performance standard, an energy use rating program for buildings, and increased imports of hydroelectricity from Canada. In 2008, Massachusetts adopted a long-term target of an 80 percent reduction from 1990 emissions levels by 2050, but had not yet established a mid-term goal. The plan is available at http://www.mass.gov/Eoeea/docs/eea/energy/2020-clean-energy-plan.pdf.

Industry and NGOs

  • NCEP Decommissioned. The Bipartisan Policy Center (BPC) announced that it has closed the National Commission on Energy Policy (NCEP), a program launched in 2003 to devise and promote energy and climate change policies that could attract bipartisan support. Jason Grumet, the President of BPC, said that the decision would clear the way for BPC to "step back and exhale" before re-entering the energy policy debate later in 2011. Grumet said the BPC's energy policy work would likely have a renewed focus on energy security, public health, and the economy.

Studies and Reports

  • Study Finds Adoption of Electric Vehicles in China, India Could Increase CO2 Emissions. A study published in the journal Energy Policy by two Oxford University researchers, Reed Doucette and Malcolm McCulloch, concludes that the effectiveness of electric vehicles in reducing GHG emissions depends heavily on the local fuel mix used to generate electricity—and that coal-dependent countries such as China and India could actually see a net increase in CO2 emissions if they were to adopt electric vehicles in large numbers. The paper notes that in countries with less carbon-intensive electric power sectors, the environmental benefits of electric vehicles can be significant. According to the study, a mid-size electric SUV fueled in France—where 80% of electricity is supplied by nuclear power—would result in CO2 emissions of approximately 15 grams per kilometer, compared to 160 grams per kilometer for the same vehicle driven on gasoline.

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