Climate Change Regulation via the Back Door

Transcription

1 Climate Change Regulation via the Back Door Arnold W. Reitze, Jr. Professor of Law University of Utah Copyright May 18,

2 Introduction World CO 2 emissions up 36% in 18 yrs. U.S. CO 2 emissions up 16% in 19 yrs, but down 6.1% in U.S. CO 2 emissions 85.1% of GHG. 94% of CO 2 from fossil fuel combustion % from electric power generation % from transportation sector. 2

3 Population/ Consumption World Population Growing by over 75 million a year--about 25% of U.S. World Coal Consumption up 12%. World Petroleum Demand up 26%, but consumption flat World Net Thermal Electricity Generation up 28.64%. 3

4 U.S. Population Drives Emissions ,824, ,052, ,438, ,050,816 Population growth since ,612,104. 4

5 Atmospheric CO 2 Concentration 1960 <320 ppm about 350 ppm about 360 ppm about 388 ppm about 391 ppm. 5

6 Federal Control Efforts International Proposed Domestic Legislation Using Existing Domestic Legislation--Clean Air Act 6

7 International Developments Kyoto Protocol (1997) ends in Cancun, Mexico Dec generally a failure; pledge of $100 billion annually by 2020 unlikely to materialize; no agreement on binding reductions. Bangkok April little progress COP-17 scheduled for Nov. 28, 2011 in Durban, South Africa. 7

8 International Emissions Kyoto members. 20 nations produce nearly 80% of CO 2. 8 nations plus EU have emissions of 2% or more of the world s CO 2 emissions. 8

9 U.S. Domestic Legislative Proposals H.R Clean Energy and Security Act of 2009 (Waxman-Markey) House approved June 26, target of 17% GHG reduction. Comprehensive approach with cap-andtrade. 9

10 H.R Reductions based on allowances that decrease over time. An allowance allows emissions of one metric ton of CO 2 e 70.4% to 82.5% are free. About 75% of all allowance are to fund non-ghg reductions. Ten year value of allowances $ 825 billion. Those in the bottom 20% of incomes are allocated 15% ($124 billion over 10 yrs)

11 Senate Bills S (Kerry-Boxer) Clean Energy Jobs and American Power Act.» Similar to H.R American Power Act (Kerry Lieberman) Cap & Trade plus expanded nuclear, oil & gas production and renewable energy mandates. 11

12 S American Clean Energy Leadership Act of 2009 (Bingman) Funds energy efficiency, clean energy technology, domestic oil & gas development, grid improvement, and requires 15% of electricity to be renewable energy by It does not have cap-and-trade. 12

13 May 2011 Cap-and-Trade is dead. Many bills with a narrow focus that seek to expand energy development are pending. Budget deficit effects all climate change funding efforts. EPA s budget is being cut. Most Republicans and some Democrats seek to limit/delay EPA s authority over GHG control, e.g. H.R Passed House 4/7/11. 13

14 GHG Control Using Existing Federal Law Mandatory Reporting of GHGs, 74 Fed. Reg. 56,260 (Oct. 30, 2009). Based on CAA 114 & 208 authority Compliance required for sources of 25,000 mt/ yr, some motor vehicle manufacturers, and listed industries. First reports due September 30,

15 GHGS and the Clean Air Act Massachusetts v. EPA 127 Sup. Ct (2007) GHGs are air pollutants under 302(g). Three additional requirements to regulate motor vehicle Endangers public health or welfare Appropriate cost effective technology exists Adequate time to comply is provided. EPA made endangerment finding December 15, 2009, but many lawsuits are challenging finding. Light-duty vehicles regulated May 7, 2010 at 75 Fed. Reg. 25,

16 CO 2 Is a Byproduct of Combustion HC + O 2 + N 2_ --> CO 2 + H 2 O + N 2 + heat This leaves two options Don t combust fossil fuels or Sequester carbon. 16

17 CO 2 as a Criteria Pollutant If NAAQS more stringent than ambient air SIP revisions required, but no hope for attainment LAER would apply. If NAAQS less stringent than ambient air PSD requirements apply including BACT. GHGs are not criteria pollutants at this time. Therefore the nation is attainment for GHGs and PSD program applies. 17

18 Construction Permits PSD permits required for major new or modified sources as of January 2, Requirements explained in EPA s March 2011 Guidance for GHGs; EPA seeks energy efficiency improve. Case-by-case determination by state permitting authority. EPA to issue permits in Texas.ESA issues. 18

19 Tailoring Rule EPA promulgated a rule June 3, 2010 New or modified sources subject to PSD permitting emitting 75,000 tpy of CO 2e. New sources of GHGs without operating permits to be covered if emissions exceed 100,000 tpy of CO 2e. The rule is being litigated. 19

20 Operating Permits At a 100 tpy threshold operating permits will be needed for1.2 million commercial buildings 200,000 manufacturing facilities and 20,000 farms-there are now about 150,000 Subchapter V operating permits. Tailoring rule limits permit requirements to existing sources greater than 100,000 tpy. 20

21 New Source Performance Standards NSPS are a likely tool to be used for GHG control. Many NSPS are expected to have new emission standards established for GHGs. EPA proposed fossil fuel power industry NSPS rule July 26, 2011; Petroleum industry NSPS rule proposed Dec. 10,

22 Hazardous Air Pollutants CO 2 does not meet traditional definition of hazardous. CO 2 can t be both a criteria pollutant and a HAP. There does not appear to be a CO 2 control technology that can be used to create a MACT standard. 22

23 Using the CAA to Increase Costs Environmental organizations use lawsuits concerning traditional pollutants to make fossil fueled plants uneconomic. No new construction starts in the past two years -- claims Sierra Club. TVA to retire 18 of its 59 coal plants -- consent decree announced 4/14/

24 NAAQS October 17, 2006, more stringent PM 2.5. March 27, 2008, 8 hr ozone standard. February 9, 2010, I hr NO 2 standard. June 22, 2010, 1 hr. SO 2 standard. 24

25 PSD BACT for major new and modified sources. Integrated gasification combined cycle technology as BACT. Haze Rule-- BART requirements, SIP modifications including fuel switching. 25

26 Hazardous Air Pollutants MACT standards for coal and oil power plants proposed May 3, Fed. Reg Final regulation to be promulgated by November 16, Covers emissions of mercury, PM (surrogate for metals) and HCl. Applies to about 1,200 existing coal-fired units and 150 oil-fired units at 525 power plants. March 21, 2011 Industrial Boiler Final Rule. 26

27 Interstate Transport CAIR Rule of 2005 remanded by D.C. Circuit. August 2, 2010 EPA promulgated a proposed Transport Rule applicable to most eastern states. Limits No x and SO 2 emissions EPA grants N.J. request to limit Penn. Utility s emissions 3/31/

28 Resource Conservation and Recovery Act Coal Ash proposed rule June 10, Ash to be regulated as hazardous (high cost to comply) or non-hazardous with new requirements. 28

29 Clean Water Act Thermal power plant cooling water intake structures CWA 316(b). Proposed rule 76 Fed. Reg (Apr. 20, 2011); requires BAT, which requires costs to be considered. 29

30 Conclusion The CAA is a poor tool to control CO 2 -- new legislation is needed. Improving the efficiency of energy use is the least costly way to reduce carbon emissions. Alternative energy development shoiuld be supported, but it will not solve the GHG problem. Nuclear energy needs to be revisited. A carbon tax with all the money returned to taxpayers is an economic approach worth considering. 30