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December 2-8, 2023
In this week's issue:
- EPA Issues Final Oil and Gas Methane Rule (December 2, 2023)
- House Passes Bill to Block EPA’s Multipollutant Emission Standards for Passenger Cars and Light Trucks (December 4-6, 2023)
- FHWA Publishes Final National GHG Performance Measure (December 7, 2023)
- White House Issues Updated Unified Regulatory Agenda (December 5, 2023)
- With New Email Portal, EPA Seeks SEPs (December 7, 2023)
- Canada Announces Cap and Trade Program for Oil and Gas Sector Emissions (December 7, 2023)
This Week in Review
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EPA has released its final rule governing emissions from new and existing oil and gas production, “Standards of Performance for New, Reconstructed, and Modified Sources and Emissions Guidelines for Existing Sources: Oil and Natural Gas Sector Climate Review”, (EPA Docket EPA-HQ-OAR-2021-0317). The rule was announced by Administrator Michael Regan in Dubai. EPA’s rule includes New Source Performance Standards (NSPS) for methane and VOCs from new, modified and reconstructed sources and Emissions Guidelines (EG) for state plans governing methane from existing sources. Oil and natural gas operations are the largest industrial source of methane pollution in the U.S. The rule, originally proposed in November 2021 with a supplemental proposal issued on December 6, 2022, aims to prevent 58 million tons of methane emissions from 2024 to 2038, a nearly 80 percent reduction below the future methane emissions expected without the rule. EPA estimates the final rule will also protect public health by avoiding 16 million tons of VOCs from 2024 to 2038, along with 590,000 tons of toxic air pollutants like benzene and toluene. The new rule phases in a prohibition on routine flaring, and mandates zero emissions from equipment such as storage tanks, reciprocating compressors, centrifugal compressors, pneumatic pumps and controllers (even prohibiting using natural gas in all but a few circumstances) and sweetening units, liquids unloading processes, and centralized production facilities. It also adds new monitoring and repair requirements, including for compressor stations and smaller wells. Smaller wells produce six percent of U.S. oil and gas but account for up to half the methane emissions from well sites. It also enables owner/operator use of low-cost and innovative methane monitoring technologies in addition to proven strategies. The NSPS new federal NSPS, added at 40 C.F.R. part 60, subpart OOOOb, will apply to sources coming online after December 6, 2022; those online prior will be considered existing sources and will have later compliance dates under state plans in a new Subpart OOOOc. EPA’s proposal gives states two years to propose standards for these sources, and operators have three years after that submission deadline to comply. The rule does not allow for equivalency of existing state oil and gas methane programs in plans for limiting methane emissions from existing sources. State standards in these plans must be as strict as the federal standards, and they must conduct meaningful public engagement during their development of these standards under the rule. The final rule preserves but strengthens EPA’s role and the data requirements in its “Super Emitter” program for identifying and addressing significant methane leaks from production facilities, including avenues for qualified third parties to alert EPA of pollution events. EPA will now oversee and vet reports before requiring owner/operator actions. EPA estimates that the final rule will yield total net benefits of $97 to $98 billion dollars from 2024-2038 ($2019), or $7.3 to $7.6 billion a year, after taking into account the costs of compliance and savings from recovered natural gas. will result in increased recovery of natural gas, valued at $7.4 to $13 billion from 2024-2038 ($2019), or $820 to $980 million a year. EPA’s estimates account for climate benefits and some health benefits from reduced ozone exposure, and use EPA’s current social cost of greenhouse gases (SC-GHG), which attempts to value avoided climate damages.
For further information:
and
On Wednesday, by a vote of 221 to 197, the House of Representatives passed the Choice in Automobile Retail Sales (CARS) Act, introduced by Rep. Tim Walberg (R-MI) on July 6, 2023. H.R. 4468 would prohibit EPA from finalizing, implementing or enforcing EPA’s May 5, 2023, proposed rule, “Multi-Pollutant Emissions Standards for Model Year 2027 and Later Light-Duty and Medium-Duty Vehicles.” In addition, the bill would amend Clean Air Act Section 202(a)(2) to bar any rule or rule revision issued under this section, as well as any rule or revision prescribed before the date of enactment of this bill, from 1) mandating the use of any specific technology or 2) resulting “in limited availability of new motor vehicles based on the type of new motor vehicle engine in such new motor vehicles.’’ In a Statement of Administration Policy (SAP) issued on Monday, December 4, 2023, in anticipation of the House vote, the White House writes that the Biden Administration strongly opposes H.R. 4468, which “would catastrophically impair EPA’s ability to issue automotive regulations that protect public health, save consumers money, strengthen American energy security, and protect American investments in the vehicle technologies of the future. EPA’s proposed standards for passenger cars and light trucks are performance based, allowing vehicle manufacturers to choose the mix of technologies best suited for their customers.” The Administration further writes in the SAP that the bill would undermine $150 billion in investments that companies have announced they will make in U.S. electric vehicle and battering manufacturing, and “chill further progress.” In addition, all the benefits of the standards would be seriously undercut, “harming American consumers, companies, and workers.” The White House says, “If the President were presented with H.R. 4468, he would veto it.” A companion to H.R. 4468 – S. 3094 – was introduced in the Senate by Senator Mike Crapo (R-ID) on October 19, 2023.
For further information:
https://www.congress.gov/118/bills/hr4468/BILLS-118hr4468rh.pdf
and
https://www.whitehouse.gov/wp-content/uploads/2023/12/SAP-HR-4468.pdf
and
https://www.congress.gov/bill/118th-congress/senate-bill/3094
and
https://www.congress.gov/bill/118th-congress/house-bill/4468
The U.S, Department of Transportation’s (DOT’s) Federal Highway Administration (FHWA) published the final “National Performance Management Measures; Assessing Performance of the National Highway System, Greenhouse Gas Emissions Measure” in the Federal Register (88 Fed. Reg. 85,364). The rule amends FHWA’s national performance management measures regulations and establishes a protocol for measuring and reporting transportation-related greenhouse gas (GHG) emissions. Further, the rule requires state DOTs and metropolitan planning organizations (MPOs) to set declining targets for carbon dioxide and report their progress toward achieving the targets. The rule does not mandate the level of the targets but, instead, gives state DOTs and MPOs flexibility to establish targets “that are appropriate for their communities and that work for their respective climate change and other policy priorities, as long as the targets aim to reduce emissions over time.” Under the rule, state DOTs are required to set two- and four-year emission reduction targets and MPOs are required to set four-year emission reduction targets. State DOTs must establish and report their first targets by February 1, 2024. This final rule is effective January 8, 2024.
For further information:
https://www.govinfo.gov/content/pkg/FR-2023-12-07/pdf/2023-26019.pdf
The White House Office of Management and Budget (OMB) issued its Fall 2023 Unified Agenda of Regulatory and Deregulatory Actions, which reports on the measures that federal agencies plan to issue in the near future and longer term. The unified agendas are released semiannually. There were 52 items on this latest agenda pertaining to EPA’s Office of Air and Radiation, including one measure in the pre-rule stage, 28 in the proposed rule stage and 23 measures listed in the final rule stage. Several air rules are now expected later than previously announced, including “Reconsideration of the National Ambient Air Quality Standards for Particulate Matter” (final action scheduled for this month); air toxics standards for ethylene oxide from commercial sterilizers (final rule scheduled for March 2024); regulations for the addition of new Hazardous Air Pollutants, such as 1-bromopropane (date for final action “to be determined”); Greenhouse Gas Emissions Standards for Heavy-Duty Vehicles—Phase 3 (final action scheduled for March 2024); and Methane Emissions and Waste Reduction Incentive Program for Petroleum and Natural Gas Systems under the Inflation Reduction Act (final rule “to be determined”).
For further information: https://www.reginfo.gov/public/do/eAgendaMain
EPA’s Office of Enforcement & Compliance Assurance (OECA) has issued an invitation for stakeholders and the public to offer ideas for supplemental environmental projects (SEPs), “voluntary projects that bring environmental and public health benefits beyond those required by law to communities impacted by a violation of an environmental law or regulation.” OECA’s Assistant Administrator, David Uhlmann, offered that interested parties can email SEPideas@epa.gov with a project title, detailed description, the public health and/or environmental benefits, information about the location, and contact information. Since 1990, SEPs have been included in more than 2,800 settlements with over $600 million in projects that have an environmental benefit. However, in March 2020, a memorandum from the Department of Justice (DOJ) barred the use of SEPs – a position subsequently reversed in May 2022 by the DOJ in the Biden Administration. EPA’s solicitation of ideas for SEPs notes that they must be related to the settlement of an enforcement violation and must address environmental and public health impacts.
For further information:
https://www.epa.gov/enforcement/supplemental-environmental-projects-seps#sepideas
Canada has announced a new cap and trade system governing emissions form its oil and gas companies that aims to cut methane emissions by 38 percent from 2019 levels by 2030. The new program applies to extraction, processing, and production of crude and light oil; surface mining of oil sands and extraction of bitumen; production and processing of natural gas (including upstream gas gathering pipelines); and production of liquified natural gas. Canada is the world’s fourth-largest oil producer and has set a target to cut greenhouse gas emissions from the sector by forty five percent below 2005 levels by 2030. The oil and gas sector is Canada’s highest-polluting industry, accounting for more than a quarter of all the country’s emissions.
For further information: