Environment Committee Update
August 28, 2014
Contact: Darren Suarez
- Tailoring Rule
- Proposed Revisions to Regulations: Bulk Storage of Petroleum and Chemicals; Management of Used Oil (6 NYCRR Parts 595-599, 612-614, 370, 374-2)
- A.5117-C / S.3667-D - Requires the licensure of mold assessment and remediation specialists
- Ground Level Ozone Standard
- Clean Power Plan - Clean Air Act Sec. 111(d)
- Brownfields S.7878 (Grisanti) / A.10153 (Sweeney)
- Utility Air Regulatory Group v. Environmental Protection Agency
On June 23, 2014 . Justice Scalia announced the judgment of the Court and delivered an opinion, that the EPA may not require a source to obtain a Title V permit solely on the basis of its potential GHG emissions. Provided however, the Court held EPA reasonably interpreted the Clean Air Act to require sources that would need permits based on their emission of conventional pollutants to comply with “best available control technology” for greenhouse gases.
Specifically, the Court was evaluating, the legality of EPA’s Tailoring Rule, which was promulgated in steps and established threshold levels of GHG emissions that triggered prevention of significant deterioration (“PSD”) and Title V requirements for two categories of sources.
The Business Council of New York State had joined with State and Local Chambers and Other Business Groups include 75 separate state and local business associations representing companies in 33 different states in an Amicus brief. The brief focused upon the severe economic consequences that will result from regulating Greenhouse Gasses (GHGs) under the PSD and Title V permitting programs.
- EPA’s Response
In the end of July the EPA issued a memo to express their next steps and preliminary views on the application of Clean Air Act Permitting Programs to Greenhouse Gases Following the Supreme Court's decision.
Specifically the memo concluded the following:
- EPA confirmed that it will no longer require sources to apply for PSD and Title V permits on the basis of greenhouse gas (“GHG”) emissions alone (so-called “non-anyway” or “Step 2” sources);
- EPA re-established 75,000 tons per year (“tpy”) as the threshold for triggering BACT requirements for GHG emissions from sources that trigger PSD requirements on the basis of emissions of conventional pollutants (so-called “anyway” sources); and
- EPA set forth its view that state permitting authorities may continue to require non-anyway sources to obtain PSD and Title V permits if there is independent state authority to do so.
- State Response for Step 2 Source
The Business Council Environment Committee is interested in hearing from New York based Step-2 sources (and or their environmental consultants), in order to develop a coalition which can petition the DEC to properly and rightly address non-anyway sources, consistent with the ruling. New York unlike some states does not have a specific provision in the state law which automatically modifies the state-law permitting requirements based on the Supreme Court's decision.
Proposed Revisions to Regulations: Bulk Storage of Petroleum and Chemicals; Management of Used Oil (6 NYCRR Parts 595-599, 612-614, 370, 374-2)
The New York State Department of Environmental Conservation (DEC) has proposed revisions to regulations for the bulk storage of petroleum (Petroleum Bulk Storage (PBS)) and chemicals (Chemical Bulk Storage (CBS)) and for the management of used oil. DEC is revising these regulations to reflect changes in State laws and federal laws and regulations.
The DEC has issued proposed revisions to the regulations following the release of the informal “draft for consideration” last August. Many of the modifications to the proposed revisions were made in response to comments received, but some comments appeared to remain unaddressed while some revisions did not appear in the draft.
On the final day of the 2014 New York State legislative session, both houses of the New York State legislature passed mold licensure legislation. The legislation in some form or another has been before the legislature for a number of years, but has never moved. This year as a result of a unique political dynamic and announced retirement of one of the sponsor’
The bill amends amend New York State Labor Law as well as the State Finance Law to require that only licensed professionals perform mold assessment, abatement, and remediation. Specifically, the legislation would establish: definitions for necessary terms; licensing requirements and penalties; minimum work standards for the conduct of licensed mold assessments and remediation; post-remediation assessment requirements; as well as a mold assessment and remediation account for the Department of Labor to offset incurred costs associated with these proposals. The law would take effect 180 days following their enactment.
The Business Council is opposed to the legislation because in its current form the legislation contains unreasonable scope, unclear thresholds, unrealistic requirements, and will have unintended consequences.
The Business Council has drafted a letter to the administration urging the bill be vetoed. Additionally, members of the Business Council interested in joining a letter in opposition to the legislation may contact Darren Suarez. A draft of the proposed letter can be found here.
The EPA is expected to release new ground level ozone standards before the close of the year.
On April 29, 2014 Judge Yvonne Gonzalez Rogers of the U.S. District Court for the Northern District of California ordered1 the U.S. Environmental Protection Agency to:
- issue a Proposed Rule based on its review of the national ambient air quality standards (“NAAQS”) for ozone in accordance with 42 U.S.C. §7409(d)(1) no later than December 1, 2014; and
- issue a Final Rule based on such review no later than October 1, 2015.
Under the Clean Air Act, EPA is instructed to select a primary national ambient air quality standard (NAAQS) that protects the nation’s public health with an “adequate margin of safety” (Section 109(b)(1)). In March 2008, EPA lowered the primary 8-hour ozone NAAQS from 80 parts per billion (ppb) to 75 ppb. The new NAAQS rule is expected to tightening the standard to in the 60 to 70 ppb range.
A new study by NERA Economic Consulting and commissioned by the National Association of Manufacturers (NAM) reveals that a more 60 ppb ozone standard could reduce GDP by $270 billion per year and carry a compliance price tag of $2.2 trillion from 2017 to 2040, increasing energy costs and placing millions of jobs at risk. In New York the study predicts the new NAAQS rule could potentially cause.
- $399 Billion Gross State Product Loss from 2017 to 2040
- 235,241 Lost Jobs or Job Equivalents per Year
- $246 Billion in Total Compliance Costs
- $3,400 Drop in Average Household Consumption per Year
- $30 Billion More for Residents to Own/Operate Their Vehicles Statewide (2017 to 2040)
- Up to a 15 Percent Increase in Residential Electricity Prices (National Average)
- Up to a 32 Percent Increase in Residential Natural Gas Prices (National Average), and
- A shutdown of 100 Percent of New York’s Coal-Fired Generating Capacity
At this price, the NAM estimates that it would be the most expensive regulation the U.S. government has ever issued.
Members can join with NAM and express opposition to the proposed new NAAQS rule by sending a letter from the manufacturing works website. The Business Council will continue to oppose the new NAAQS rule and will update members regarding the latest news surrounding the issue.
On June 2nd the Environmental Protection Agency proposed a rule designed to cut carbon dioxide emissions from existing coal plants by as much as 30 percent by 2030, compared with 2005 levels.
The rule does not require the same level of emission reduction in each state. EPA’s emission guidelines set a range of state-specific emission goals, based on “best system of emission reduction” The EPA established the state-specific emission goals using four “building blocks”.
Specifically, EPA started with each state’s 2012 CO2 emissions rate (lbs/MWh) and then looked at four strategies that are in widespread use in the energy sector:
(1) measures to make coal plants more efficient,
(2) increased use of high efficiency, natural gas combined cycle plants,
(3) generating electricity from low/zero emitting facilities, and
(4) demand-side energy efficiency.
Each state has the flexibility to choose how to meet the goal using a combination of measures that reflect its particular circumstances and policy objectives. States are in charge of these programs and can draw on a wide range of tools – not just the building blocks.
New York’s goal requires the State to make a 44% power sector emissions rate reduction by 2030. EPA based the target for New York base on cuts through the following:
- 0.8%: Increase efficiency of coal plants
- 14.5%: Use low-emitting natural gas combined cycle plants more where excess capacity is available
- 18%: Use more zero-emitting power sources such as renewables and nuclear
- 10.5%: Reduce electricity demand by using electricity more efficiently
EPA proposed NYS Interim 2020-29 has been established at 635 lbs/MWh, and its 2030 final goal is 549 lbs/MWh.
On June 24, 2014 The DEC conducted a workgroup to discuss the proposed EPA regulations.
The state-specific emissions goals have produced curious results. Many have questioned how the EPA reached its conclusions. States like New York and Washington which have an energy generation sector with reduced carbon footprint are required to make substantial reductions. Washington ranks near the bottom of the list of greenhouse gas emitting states and has a power plant CO2 emissions rate of only 763 lbs/MWh— the nation’s fifth lowest but must reduce emissions by 81%. Other states, such has North Dakota with a very carbon intensive energy generation sector (2,368 lbs/MWh) but is required to only make an 11% reduction in its emissions.
The EPA is seeking comment on the proposed Clean Power Plan for existing power plants. This document outlines the categories in the proposed rule for which we are requesting input, and includes the Federal Register page numbers where the information can be found. The Business Council will be preparing remarks regarding the Clean Power Plan based upon member input. The Business Council will prepare two sets of comments one set of comments to the EPA, and one specific set of comments to the DEC. Please note that all EPA comments on the proposed rule must be received on or before October 16, 2014.
At the end of this legislation session the Business Council supported S.878/A.10153 which will extend the Brownfield Cleanup Tax credit until March 31, 2017 and provide $300 M in new bonding for the State Superfund program.
The legislation passed both houses of the legislature and will be advanced to the Governor’s desk. The Business Council supports the enactment of the legislation and was pleased that it has been reported that the Governor plans to sign the legislation. The Business Council will be drafting a letter in support and a coalition supporting the extension.