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.

“Settling” Itself Up To Fail

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Over the past week, EPA announced that it would reconsider parts of the “Utility MACT” air toxics regulation on power plants and that it needs even more time to finish it’s reconsidered “Boiler MACT” regulation to get it right. In doing so, EPA implicitly admitted that it moved too fast and underestimated the challenges present in crafting each regulation.

There is a very unsettling common thread in both the Utility MACT and Boiler MACT rules: both regulations were born from litigation, and the deadlines for issuing the regulations came from judicial settlements EPA entered into.

In both cases, EPA agreed to a schedule providing little time to review and respond to comments before entering a final rule. In both cases, the judicially-enforced consent decree EPA entered into prevented the agency from issuing a final rule that was free from errors. And in both cases, EPA now finds itself in the midst of a messy reconsideration process to correct those errors.

These are not isolated events. In fact, EPA recently entered into a consent decree for its PM2.5 National Ambient Air Quality Standards (NAAQS) that gives the agency barely 100 days to review comments, a dramatically shorter time frame than EPA has given for any new or revised PM or Ozone NAAQS since 1971. If the Agency receives 100,000 public comments on the rule—a conservative estimate—EPA staff would have to review over 1,000 comments and draft 4-5 pages of responses per day, every day, including weekends. Read More

EPA to Review Regulation on Mercury and Air Toxics Standards for New Power Plants

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The Environmental Protection Agency (EPA) announced this afternoon that it will reconsider some aspects of its Mercury and Air Toxics Standards (MATS) for new power plants. The Agency will also stay the new source rules for three months during the review process.

According to a press release, the EPA “will review monitoring issues related to the mercury standards for new power plants and will address other technical issues on the acid gas and particle pollution standards for these plants.”

The MATS rule is one of the most expensive regulations ever promulgated by the agency for power plants, and we hope the EPA’s reconsideration will provide some relief for companies building five new power plants in Georgia, Kansas, Texas and Utah.

We will be closely following developments over the next few months as the EPA begins the reconsideration. Hopefully the EPA is begining to see the many challeges and burdens this regulation will place on energy producers. This regulation will result in increased energy prices for manufacturers, contributing to the already unfavorable business environment that is limiting job growth.

Alicia Meads is director of energy and resources policy, National Association of Manufacturers.

California Manufacturers Concerned with Proposed Air Quality Regulations

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The Environmental Protection Agency (EPA) continues to pile on complex  regulations that impact manufacturers. Just last month, the Agency proposed more stringent air quality standards for fine particulate matter (i.e. PM2.5 NAAQS). Business groups are already starting to speak out. At an EPA public hearing yesterday in Sacramento, CA, the California Manufacturers & Technology Association (CMTA) urged the EPA to maintain the current PM2.5 standards.

“This proposal will unnecessarily burden the economy at a time when the country and California, in particular, are struggling to overcome the recession,” stated Mike Rogge, Policy Director at the CMTA. Rogge’s testimony highlighted the serious and immediate consequences for areas that do not attain the air quality standards established by the EPA. For example, companies building new facilities or performing major modifications to certain existing facilities in, or near, a non-attainment area will be required to install the most effective emission reduction technology regardless of cost. The EPA’s actions will cause many manufacturers around the country to think twice before expanding their operations.

We encourage all manufacturers to urge the EPA to retain the existing PM2.5 standards during the comment period which ends on August 31, 2012. You can learn more about the EPA’s proposal here.