As regulation of greenhouse gases nears, EPA releases guidelines

The guidelines are intended to help states and industry evaluate the cost and kind of technologies that would best reduce greenhouse gases.

The Environmental Protection Agency on Wednesday unveiled new regulatory guidance intended to help states' air-pollution regulators and heavy industry evaluate the cost and kind of technologies that would best reduce greenhouse-gas emissions.

It comes in the run-up to the historic first regulation of greenhouse gases (GHGs) from US industrial sources on Jan. 2. On that date, the EPA will require large new projects or plant upgrades that emit more than 75,000 tons of greenhouse gases to have a permit.

After that, in July, the EPA will begin to include other “regulated” sources that emit more than 100,000 tons. By July 2012, it will begin to weigh smaller emitters, but none under 50,000 tons. All this has generated a firestorm of opposition in Congress and among business interests.

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Wednesday's guidance is only for companies planning large new facilities or big changes to existing ones. These projects will be required under the Clean Air Act to employ "best available control technology" to curb GHG emissions. Power plants, cement plants, and refineries would be included, for instance. Emissions from small sources such as restaurants and farms are not covered by the new regulations.

The EPA's announcement comes as the White House works to put greenhouse-gas regulations in place before a new Republican-led House of Representatives takes power. Some see the announcement as the White House "rushing to get its rules out" before next year's hearings in the House, which are expected to question the EPA’s scientific basis for greenhouse-gas regulations.

"In our view, today’s [EPA] guidance may be part of an orchestrated deployment of rulemaking and enforcement actions, now that (1) the elections are over and (2) a Republican House majority in 2011 virtually guarantees deadlock on difficult energy issues," writes Kevin Book, an energy analyst with ClearView Energy Partners, in his analysis of the EPA move.

The step is part of the agency's good-faith effort to make the process as easy as possible, EPA officials said at a press conference. States and industry officials should not be thrown by the new initiative, they said, since it is being done in the same way that many other air pollutants have been regulated – within the already-tested steps and parameters specified by the Clean Air Act.

“EPA is working closely with its partners at the state and local levels to ensure permitting for greenhouse gases runs smoothly," said Gina McCarthy, assistant administrator for the EPA’s Office of Air and Radiation. “To identify GHG reduction options, EPA and the states are now ready to apply the same time-tested process they have used for other pollutants. This shows that the Clean Air Act can be used to reduce these gases in a cost-effective way."

The guidance, for instance, will avoid foisting costly technologies on industry – such as not requiring "carbon capture and sequestration" (the pumping of CO2 underground), Ms. McCarthy noted.

This isn't likely to mollify industry groups, however, which have long charged that the EPA's steps to regulate GHGs are overzealous and punitive and will cost America jobs at a time it can least afford it. The US Chamber of Commerce sought in March for the EPA to reconsider its finding last December that GHGs "threaten the public health and welfare of current and future generations."

"The Chamber believes that the right way to reduce greenhouse gas emissions in the atmosphere is through bipartisan legislation and comprehensive international agreement," Steven J. Law, chief legal officer and general counsel of the US Chamber of Commerce, said in a statement at that time. "The wrong way is through the EPA's endangerment finding, which triggers Clean Air Act regulation.... The Chamber has long warned that regulating greenhouse gases under the Clean Air Act would be bad for jobs and local economies."

In line with that sentiment, Texas has said it wants to do away with EPA authority to regulate GHGs entirely. Sen. John Rockefeller (D) of West Virginia is proposing to curb the agency's authority for two years.

McCarthy said she was disappointed by Texas’ refusal to participate in the regulatory process, but the permitting process will go forward anyway, she said in a conference call.

Environmentalists maintain that fears surrounding the economic impact of the EPA's moves are largely overblown and part of a larger industry campaign to sway Congress to remove the EPA's authority to regulate carbon dioxide and other GHG emissions.

"Congress has been hearing a steady drumbeat from industry about how costly these measures will be. And there's been so much hyperbole and obfuscation, it's no wonder they would be pushing this kind of restructuring on the EPA," says Bill Becker, executive director of the National Association of Clean Air Agencies, which represents state and local clean-air authorities.

On the contrary, he notes, the EPA’s steps – rather than leading to de facto moratoriums on building new plants or expanding them because of regulatory uncertainty – would increase certainty and cut costs for industry over the long term.

"EPA is bending over backward to give industry as much certainty and flexibility as a regulatory agency can,” Mr. Becker says. “And in the long run, these moves will end up saving the industries money through greater energy efficiency."

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