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EPA excludes smaller US plants from new GHG rule

07.04.2012  | 

Fresh off a legal victory upholding its rules on greenhouse gas emissions, the Obama administration has decided to go easy on "smaller" facilities that emit carbon dioxide, methane and other pollutants. This protects thousands of facilities from having to undertake measures to cut emissions.



WASHINGTON -- Fresh off a legal victory upholding its rules on greenhouse gas emissions, the Obama administration has decided to go easy on "smaller" facilities that emit carbon dioxide, methane and other pollutants.

The Environmental Protection Agency said late Tuesday it would maintain existing thresholds for its greenhouse gas requirements and would not require permits from facilities that emit fewer than 100,000 tpy of emissions.

This protects thousands of facilities from having to undertake energy-efficiency measures to reduce their emissions.

The EPA currently requires new facilities that emit more than 100,000 tons to obtain permits obligating them to reduce their emissions. It also requires this from existing facilities that make changes leading to more emissions.

The requirements often apply to power plants, refiners and other big industrial facilities.

The EPA said it decided to exclude smaller facilities because state officials who issue permits wouldn't be able to handle an increased workload.

The agency did not rule out the possibility of targeting those smaller facilities in the future, saying tighter standards were not appropriate "at this time."

The American Petroleum Institute, the main lobbying arm of the oil industry and a vocal critic of the EPA's greenhouse gas rules, said it was still reviewing Tuesday's decision.

"EPA's greenhouse gas regulations continue to require businesses wishing to expand to jump through unnecessary requirements, slowing business expansion and job creation that America needs to help strengthen our economy," said API director Howard Feldman.

Tuesday's move represented the third phase of a controversial rule known as the "tailoring rule." Under this rule, the EPA increased the threshold under which greenhouse gas requirements would be triggered under the Clean Air Act.

Without this rule, thousands of facilities would have gotten caught in a regulatory snare and been forced to obtain greenhouse gas permits.

The tailoring rule was one of many greenhouse gas regulations challenged in court by state and industry groups that think the EPA overstepped its bounds.

In a landmark decision last week, the US Court of Appeals for the District of Columbia upheld the EPA's rules.

The court said the litigants challenging the tailoring rule did not have standing to do so.

Dow Jones Newswires

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W. James O'Brien, construction cost consultant

This is the first major unfunded mandate for compliance ever fielded by the U.S. Federal government in history which offers no clear and accessible value-added benefit for those who comply. This is Comer vs. Murphy where Comer won instead of being properly shelved as the Katrina lawsuit was.

Why then cannot refinery and chemical processing firms sue for demonstrated lost revenues and the cost of compliance, please? Even the original Clean Air Act provided the means whereby compliance-related equipment could rationally expect to be properly funded with Federal financial tools such as the acid rain and smog-producing gases offset emissions auction trading mechanism. NOx & SOx emissions reductions' price per tonne enjoyed proper Federal oversight and de facto support. Carbon trading is in my opinion a wretched farce even compared to what probity dominated that market in 2000, providing no capability to purchase compliance equipment through market trading of those reductions as there is no corresponding price stability possible.

What options for retrofit are open? Only firms like Marsulex Environmental Technologies or Verantis make stack-gas cleanup equipment which is capable of monetizing emissions into marketable chemical co-products. What the law now tells the chemical and refinery industry is that it has to replace all its existing manufacturing plant without providing to them the proper financial support to enable compliance.

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