Energy

No-Grow-Zone: Manufacturers Feel the Impact of Costliest Regulation Ever – Part 3

The Growing Trend of Unattainable Regulations

The Clean Air Act has been a successful environmental statute. Air quality has improved across the United States and our economy has continued to grow. Using ozone and ozone precursor emissions as an example, since 1990:

  • Highway vehicle NOX emissions are down 48 percent and VOC emissions are down 30 percent, while an additional 60 million vehicles have been added to U.S. roadways over the same time period.
  •  Manufacturers’ NOX emissions are down 52 percent and our VOC emissions have been reduced by 70 percent, while our value added to the economy has more than doubled.
  • As a country, ozone levels are down nearly 25 percent and our economy has grown by 43 percent. (continue reading…)
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Shale Gas Continues to Benefit Manufacturing

A PricewaterhouseCoopers (PwC) report released today found that U.S. natural gas production could bring an annual cost savings of $22.3 billion by 2030 for U.S. manufacturers and up to $34.1 billion by 2040. And in addition will create 930,000 natural gas driven manufacturing jobs by 2030, 1.41 million by 2040. The NAM and American Chemistry Council contributed to PwC’s report.

A similar study released in 2011 had projected one million manufacturing jobs would be created by 2025 due to the uptick in shale gas exploration and recovery, and could mean more than $11 billion in cost savings to manufacturers. With some of those jobs having been created in the last three years since that study, the new projections show that there will be even larger gains in shale gas driven manufacturing jobs, as well as even greater costs savings. (continue reading…)

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No-Grow-Zone: Manufacturers Feel the Impact of Costliest Regulation Ever

It’s Back. The Most Expensive Regulation in History

I have continued to underscore the importance of reducing regulatory burdens and regulatory uncertainty, particularly as our economy continues to recover. With that in mind, and after careful consideration, I have requested that Administrator Jackson withdraw the draft Ozone National Ambient Air Quality Standards at this time.” –President Obama, September 02, 2011

It’s been just over three years since President Obama decided the U.S. economy could not withstand the regulatory burdens and costs of a new ozone regulation. Facing reelection and a struggling economy, the President gave businesses and households a reprieve from an Environmental Protection Agency (EPA) regulation that could have been the most expensive ever issued. The reprieve ended November 26. The country’s most expensive regulation? It’s back. (continue reading…)

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Beyond Keystone, troubling signals from the White House on infrastructure permits

This week’s Keystone XL Senate vote has grabbed almost all the media attention, and for good reason: it’s fundamentally unfair to make any business wait six years for a permit. (Seriously – you could have seen “You Can’t Mess With the Zohan” in the theater the same day TransCanada filed its permit application. That’s just not right.) (continue reading…)

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Manufacturers Welcome Congress Back; Say Now Is Time To Govern

As Members of the 114th Congress descend on Washington for orientation, and the 113th Congress convenes for the upcoming lame duck session, manufacturers stand ready to work with our leaders to advance policies that will enable us to continue to grow and create jobs.   Manufacturers believe that now is the time to set aside the differences that have resulted in gridlock, and focus on the pro-growth policies that brought voters to the polls. Simply put, it is time to govern and grow. (continue reading…)

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New study shows EPA greenhouse gas regulation would raise electricity prices, impose massive new costs on manufacturers

This week, NERA Economic Consulting released an economic study on the impact of the Environmental Protection Agency’s (EPA) proposed new greenhouse gas regulation for existing power plants. The study was supported by groups from most sectors of the U.S. economy, including the American Farm Bureau Federation, American Fuel & Petrochemical Manufacturers, American Coalition for Clean Coal Electricity, National Mining Association, Association of American Railroads, Electric Reliability Coordinating Council and Consumer Energy Alliance.

NERA’s report confirms many of our fears about this new regulation: 43 states will experience double-digit increases in the price of electricity, and overall compliance costs exceed $360 billion. Some states could see price increases that exceed 20 percent. In addition, NERA found that all consumers will have to make major new upfront investments in order to reduce overall electricity demand from their power plants. For manufacturers, that is money that could often be better spent on product development.

Manufacturers are committed to addressing global climate change and have taken strong steps to reduce our emissions, promote energy efficiency and new technologies, and become more sustainable. Those steps are working. But we must also remember that many manufacturers are trade exposed and can rarely stomach major new costs (like higher energy prices) that make us less competitive against our international competitors who don’t play by the same environmental rules. Manufacturers urge EPA to revise its greenhouse gas rule for existing power plants to avoid the higher energy prices and other consequences predicted in NERA’s report.

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Recent approvals signal “new normal” for LNG exports

Last week, the Federal Energy Regulatory Commission (FERC) quietly issued a final environmental impact statement for Cheniere Energy’s Corpus Christi liquefied natural gas (LNG) export facility in Texas. It required Cheniere to agree to 104 special conditions to ensure that the environment is protected, and it allowed the project to move forward. Ten days prior, FERC issued a similar approval for Dominion’s Cove Point LNG export facility in Maryland. Like the Cheniere approval, FERC required Dominion to adhere to 79 special conditions to protect the environment. It will do that, and the project is moving forward.

No drama. No congressional hearings or presidential proclamations. It was all so…normal.

Kind of nice, isn’t it?

A couple things happened to get us to this point. The meritless arguments from “not in my back yard” opponents and law firms masquerading as environmental groups didn’t hold water with FERC. The protests petered out.  (Which, for what it’s worth is what happens when you protest FERC on a Sunday, when it is closed.) The Department of Energy finally figured how to get itself out of the way and stop causing unnecessary delays. Freed from these regulatory constraints, the environmental permitting process was allowed to work properly. And so it did.

So with an election just a few weeks away, and with it the hope that the 114th Congress can actually work together on energy policy, it’s reassuring to see that on LNG exports at least we have reached a “new normal” whereby companies wanting to take on these projects actually get a yes or no answer in a reasonable amount of time.  However, it’s worth reminding everyone that Keystone XL has been waiting on a final permit decision for six years, coal exports in the Pacific Northwest are fighting uphill to just get their permits heard, and countless other projects are caught in permit limbo. Getting infrastructure projects moving and getting shovels in the ground is a bipartisan priority. Let’s use this “new normal” on LNG as a stepping stone to even better things.

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The Manufacturing & Mining Link

Today, there is no question that manufacturing in the United States is making a comeback.

But one overlooked—and at risk—driver of this resurgence is the availability and stability of domestic mineral resources. Mined mineral resources are raw materials that support nearly every sector within the manufacturing industry, from the automotive to construction to defense and high-technology. Each sector is intrinsically dependent on minerals and by extension, the mining sector.

In a newly released study by the National Mining Association, U.S. Mines to Market, SNL Metals & Mining (SNL) looks at U.S. mined commodities’ domestic supply chains and the contribution of U.S. minerals to the manufacturing sector, identifying the risks faced by high-tech, energy, medical, national defense and automotive industries. Most notably, the study points out that mismatch exists between the domestic mineral supply and demand because of an inefficient permitting system that can delay the development of new mines by a decade or more.

The nature of manufacturing is that we rely on raw materials to create products. Often times the raw materials we need are not produced in this country and these sources can become unreliable. The inability to have access to a reliable source of raw materials is an impediment and a threat to continued and sustained U.S. economic growth. For instance, many manufacturers report being concerned with a dire need for infrastructure investment and spending in the U.S. and believe that an unstable supply chain of raw materials is “impairing reliability and increasing the cost of goods movement.”

As the U.S. manufacturing sector continues to grow, the importance of a secure and reliable domestic raw material supply has never been clearer – and with it, the need for a more efficient permitting process for new mineral mines that supports the country’s manufacturing industries. If we allow U.S. mining to perform to its full potential, our nation can enjoy enormous growth and job-creation opportunities, support the domestic manufacturing revival and attract global investment dollars.

Learn more at MineralsMakeLife.org

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Eastman Chemical, Merck, Janssen R&D LLC win EPA Energy Star CHP Award

NAM board members Eastman Chemical Company and Merck & Co., along with Pennsylvania manufacturer Janssen R&D LLC, won the Environmental Protection Agency’s ENERGY STAR Combined Heat and Power (CHP) Award for their highly efficient CHP systems, which greatly exceed the operating efficiency of similar conventional systems. CHP provides both electric power and thermal energy (heat) from a single fuel source, as opposed to conventional systems that expel the steam as waste heat. A CHP system captures the energy that would normally be waste heat and uses it to provide heating and cooling.

The NAM supports policies that encourage CHP systems, which promote energy efficiency while also reducing emissions. CHP and similar technologies have allowed manufacturers to reduce our environmental footprint while increasing our productivity. Congratulations to Eastman, Merck and Janssen on today’s award.

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Cove Point LNG terminal takes giant step forward

Yesterday, the Federal Energy Regulatory Commission (FERC) formally approved the siting and construction of Dominion’s Cove Point liquefied natural gas (LNG) export terminal in Maryland, a major milestone that puts the project in position to start construction. Cove Point is an existing LNG import facility that has been in operation for nearly 40 years; Dominion is now seeking to use the facility for LNG exports, a project that will cost $3.4 to $3.8 billion and create thousands of jobs. In May, FERC completed a two-year environmental assessment and concluded that the project could be built safely with no significant environmental impact. Yesterday’s FERC order includes 79 special conditions to ensure that the environmental impact will be mitigated.

The clock is now ticking on the Department of Energy (DOE) to issue a final license to export to non-FTA countries; the agency issued a conditional license in September 2013. DOE issued a final license to Sempra’s Cameron LNG terminal on September 10, 83 days after FERC had issued that project’s combined operating license.

Manufacturers are pleased to see the permitting process for Cove Point moving closer to its conclusion, and urge DOE to move quickly on a decision for a final license.

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