EPA: Emissions Lower in 2011

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Yesterday, the Environmental Protection Agency (EPA) released its annual Inventory of U.S. Greenhouse Gas (GHG) Sources and Sinks. The Inventory estimates all of the anthropogenic – caused by man – sources and sinks of GHG emissions in the U.S.

Two weeks ago yesterday, in an alternative universe, the very first allowance “true-up” was held for companies regulated under the Waxman-Markey climate bill. In that universe, a mandatory cap was placed on U.S. GHG emissions, assuring that 2012 emission were 3 percent lower than that of 2005 emissions.

So how are we doing in reality, without the benefit of the 1,400 page Waxman-Markey legislation?

Well, EPA’s estimates only calculate emissions through 2011, however, emissions in that year were estimated to be 6.9 percent lower than 2005 emissions. And expectation is that 2012 emission will be even lower – all while our economy continues to grow. Emissions per unit of GDP are down – and way down from 1990; and emissions per-capita are down as well. But how are we doing it?

Innovation. The emergence of hydraulic fracturing and horizontal drilling technologies has made the extraction of shale gas more technically feasible and more cost-effective. Power plants of all types – coal, gas, oil and renewables – are operating more efficiently. Manufacturers are producing more, while consuming less energy. And through creative financing mechanisms buildings are being built to be more energy efficient and existing buildings are being retrofitted to use less energy.

I point all this out not to rehash the heated debates that surrounded Waxman-Markey and its predecessor and successor legislative proposals, but simply to suggest that the goals of growth and prosperity are not contrary to those seeking lower emissions and greater sustainability. In order to remain competitive in a global marketplace U.S. businesses, and manufacturers in particular, have to create innovative new processes, use energy more efficiently and operate more sustainability – and that’s exactly what they are doing.

Greg Bertelsen is director of energy and resources policy, National Association of Manufacturers.

House Subcommittee Holds a Hearing on EPA Bill

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Today, the House Energy and Power Subcommittee held a hearing on a discussion draft legislation from Representative Ed Whitfield (R-KY) that would require increased transparency regarding the economic impacts of EPA regulations. Since 2009, EPA has issued or proposed an unprecedented number of regulations which increase the cost of energy, limit fuel diversity and place tremendous economic burdens on manufacturers. In a 2012 study released by NAM, it was estimated that, by conservative estimates, the cost of just six EPA rules would cost roughly $100 billion annually and more than 2 million jobs. In a worst-case scenario, the regulations could mean the loss of $630 billion, 4.2 percent of GDP and more than 9 million jobs.

The Energy Consumers Relief Act of 2013 would require EPA to submit a report to Congress projecting energy cost increases and employment effects on any EPA rule estimated to cost more than $1 billion. In addition, the discussion draft would prohibit EPA from finalizing any of these billion dollar rules if DOE, in consultation with FERC and EIA, determine that they would cause significant adverse economic effects.

As manufacturers await rules regulating everything from water used for cooling systems to greenhouse gas emissions, we need more transparency in rulemakings, and checks and balances to ensure we are not regulating the economy back into recession.

Greg Bertelsen is director of energy and resources policy, National Association of Manufacturers.


Manufacturers Keep a Close Eye on Energy Amendments in Senate Budget

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Today the Senate is holding votes on a series of amendments to the chamber’s first budget in four years. Several of the amendments on the floor address energy issues. Manufacturers use one-third of the energy consumed in the United States which makes access to affordable energy essential. Regulations and other policies which drive up costs are extremely concerning for manufacturers.

Senator Roy Blunt has filed an amendment that opposes a carbon tax. Last month the NAM released a study by NERA economic consulting that showed a carbon tax could have a devastating impact on our economy and jobs. Placing unilateral restrictions or prices on U.S. GHG emissions, without similar regulations in operation on other major emitting nations, would disadvantage U.S. manufacturers, impact millions of jobs, and result in higher prices for natural gas, electricity, gasoline and other energy commodities.

Senator Inhofe has filed an amendment that would prevent EPA from implementing costly greenhouse gas regulations for power plants, refineries and other industrial facilities.

Senator Barrasso has an amendment that would protect exports from being blocked by unnecessarily broad environmental reviews under the National Environmental Policy Act (NEPA). Expanding NEPA to consider the environmental impact of the cargo could hamper exports of many products, such as cars, tractors, agricultural products, electronics, toys, steel, chemicals, pumps, air conditioners, elevators and airplanes.

Also, Senator Hoeven has an amendment on the floor to approve the Keystone XL pipeline. Keystone XL would create tens of thousands of manufacturing and construction jobs and provide manufacturers with an affordable source of energy. We have continued to urge the Administration to approve the pipeline as soon as possible.

EPA May Rewrite New Power Plant Regulation

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Whispers that the EPA is taking a closer look at their 2012 proposed rule to regulate greenhouse gases (GHGs) from new power plants are increasing in volume. Today, the Wall Street Journal reported that the EPA was “weighing changes” to the proposed rule “in a preemptive move to protect against possible court challenges.” The NAM has been saying since this rule was first offered that it was bad policy, standing on shaky legal ground.

At issue is the requirement that all new base-load power plants (plants that run continuously to provide a constant source of electricity) achieve the same emission limits, irrespective of plant or fuel type. In practice, the rule would function as national energy policy by handpicking which fuels and technologies are used to power our country, while barring others. This is far beyond the scope of what is delegated to EPA through any existing authority and will hurt jobs.

The NAM strongly believes that an “all of the above” strategy is necessary to keep energy affordable and the U.S. competitive in the global economy. We also believe this strategy will result in increased efficiencies and lower greenhouse gas emissions.

Revolutionary advancements are being made in power plant efficiency for all types of fuels and technologies. Supercritical coal-fired power plants, natural gas combined-cycle plants and improvements in renewable technologies have all led to greater efficiency of the power generation system and helped lower emissions. Manufacturers need a regulatory environment that supports the continued development of all of these fuels and technologies and does not siphon their contribution to our sustainable energy future by banning them at the permitting stage.

Greg Bertelsen is director of energy and resources policy, National Association of Manufacturers.

EPA Fracking Regs Would Drive Up Costs, Add Red Tape

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This morning Politico reported that former Clinton EPA Administrator and former Obama Director of the Office of Energy and Climate Change Policy Carol Browner said that the EPA should regulate fracking.

It’s a highly technical, complicated issue and I actually believe that EPA should be the one regulating it,” she said today at a BGov-NEI event in downtown Washington, noting that that step would require legislation from Congress. “I think that some states may be up to the task, [but] at the end of the day, if history is any guide, not all states will be up to the task.”

Manufacturers believe that states should be the primary regulators of hydraulic fracturing and the federal government should not be regulating fracking, unless it can prove that a compelling need exists for federal intervention. Fracking has already changed the manufacturing landscape and helped us become more competitive and it will continue to change the landscape in terms of our ability to be more energy self-sufficient. The access to affordable natural gas can create a million manufacturing jobs by 2025.

If the EPA were to get involved in regulating fracking it could drive up compliance costs, damage a strategic advantage and provide very little value added. The Bureau of Land Management is already trying to get involved in the regulation of fracking at the state level and they are essentially putting forth a solution without a problem that is completely unnecessary. EPA regulations would only duplicate existing state regulations and create confusion and additional red tape. The costs would significantly outweigh the benefits.

NAM Joins Business Groups in Filing a Brief in the Mingo Logan Case

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Yesterday the National Association of Manufacturers and other business groups filed a brief with the federal appeals court in D.C. on Mingo Logan Coal Co. case against the Environmental Protection Agency (EPA). If you recall in early 2011 the EPA retroactively revoked a dredge-disposal permit that had been issued years before to Mingo Logan and the company was in full compliance.

In March of 2012 a federal judge ruled that EPA did not have the power to revoke the permit. This has resulted in the EPA appealing to the DC. Circuit.

The brief filed yesterday highlights how problematic and unreasonable it is for the EPA to have revoked this permit. If this EPA is allowed to modify existing permits it will discourage investments in new projects that would require similar section 404 permits.

Again this is another prime example of overreach from the EPA that will negatively impact job creation and hurt our economy.

 Read more about the case this Associated Press story.

EPA and DOT Release Final Fuel Standards for Cars and Trucks

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Today the Department of Transportation and the Environmental Protection Agency released final fuel efficiency standards for cars and light-duty trucks for model years 2017 to 2025. The standard will set the limits at 54.5 mpg by 2025.

By setting one national standard, rather than a patchwork of state standards as the California Air Resources Board had proposed, automakers now have the regulatory certainty they need, and we are confident they will continue to rise to the occasion and meet these very aggressive new fuel economy standards. 

We continue to stress the need for a strong, comprehensive, and realistic midterm review in 2018 that allows regulators the flexibility to change the rule if automakers cannot achieve the 2025 targets depending on advancements in technology as well as consumer demand.

The bar has been set high, and it’s important to remember this is a consumer driven industry so the midterm review is extremely important. Manufacturers lead our economy in innovation and they will continue to work to achieve these new standards and improve the energy efficiency of vehicles and in the manufacturing process.

Ross Eisenberg is vice president of energy and resources policy, National Association of Manufacturers.

NAM Joins in Filing Reply Brief on the EPA Ozone Limits Case

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Today the National Association of Manufacturers is part of a group that filed a reply brief with the U.S. Court of Appeals for the D.C. Circuit in the Mississippi V. EPA case on the 2008 ozone limits. This brief was filed in response to the briefs filed by the EPA and other environmental groups who have intervened in the case.

This case dates back to the EPA’s reconsidered ozone standard from 2008 which lowered the National Ambient Air Quality Standards to .075 ppm. The brief filed today reiterates the NAM’s position that the EPA did not have sufficient evidence in the record to justify its conclusion that the public health risk from ozone was any different in 2008 than it was in 1997 when the last ozone standard was set.

Also the brief argues that the EPA failed to justify why the 1997 standard was no longer “requisite,” as required by the statute, to protect public health with an adequate margin of safety. The agency also failed to rely on air quality criteria that accurately reflect the latest scientific knowledge, and set secondary standards based on the defective primary standard.

The EPA’s ozone standard threatens the competitiveness of manufacturers and businesses of all sizes throughout the country. In September of last year President Obama decided to delay another reconsideration to lower the standard even further. This would have been detrimental to our economy and would have driven job growth to a halt.

The ozone reconsideration is just another example EPA regulations causing uncertainty for manufacturers. We need certainty from Washington, not more of the same costly regulations that are hurting manufacturers’ ability to create jobs and grow.

Quentin Riegel is vice president of litigation and deputy general counsel, National Association of Manufacturers.

Federal Appeals Court Rejects EPA’s Overreach Again

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In 1994, Texas adopted its “Flexible Permit Program” to comply with Clean Air Act requirements for minor new sources of emissions. It submitted its plan for approval to the EPA, which is required by law to act within 18 months. Years passed without EPA action, and industry sued for an answer.  Finally, sixteen years later, EPA disapproved the Texas plan, throwing into doubt the legality of activities covered, at this point, by about 140 permits.  Every facility with a flexible permit could face fines or other enforcement action regardless of the emissions they produce.

The NAM and a variety of industry parties, as well as the State of Texas, sued.  Today, a federal appeals court agreed to throw out EPA’s disapproval of the Texas plan, finding no statutory basis for its criticisms of the plan. Instead, the court recognized what EPA did not – that the Clean Air Act sets goals and basic requirements, and gives the states broad authority to determine the methods and particular control strategies they will use to achieve them.

Basically, the court told EPA not to micromanage state implementation of the Clean Air Act.  That law makes environmental regulation a shared responsibility, and it is not appropriate for EPA to require states to adopt its own language or procedures as long as the state plans enforce the law’s requirements.

It is quite unusual for courts to overturn EPA decisions, since agencies enjoy a substantial degree of deference under the law, both on factual determinations and on how to legally interpret ambiguous statutes.  But in this case, the court found that EPA made no factual findings or cogent theory that the Texas plan would interfere with proper Clean Air Act enforcement. The agency’s preference for its own way of enforcing the requirements was not enough to justify interfering with a system that Congress established to provide for shared responsibility. Read More

NAM Joins Brief Challenging EPA’s Utility MACT Rule

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Last Friday the National Association of Manufacturers joined several other business groups in filing an amicus brief in the U.S. Court of Appeals for the District of Colubmia urging the court to strike down the EPA’s Utility Mercury and Air Toxics Standards (MATS) for new power plants.

This burdensome and costly regulation from the EPA is already having an impact on jobs, as several plants throughout the country are being forced to close. Utility MATS will also drive up energy prices on manufacturers who use one-third of the energy our nation consumes.

The amicus brief filed Friday argues that the EPA set standards that utilities are unable to meet with existing technology. This methodology has an impact on other manufacturing sectors that are also subject to similar regulations.  The EPA’s approach will ultimately prevent construction of new plants because of the inability to meet these new unachievable standards.

With unemployment stuck at 8.3 percent and weekly indicators showing economic growth is slowing manufactures simply can’t afford an energy price increase.