EPA Takes First Step in Executing President Obama s Climate Action Plan to Regulate GHG Emissions from Major Utility Sources

Transcription

1 EPA Takes First Step in Executing President Obama s Climate Action Plan to Regulate GHG Emissions from Major Utility Sources October 30, Winston & Strawn LLP

2 Today s elunch Presenters Jay Holloway Winston & Strawn Partner,Environmental Practice Group Washington, D.C. JHolloway@winston.com Peter Belmonte ERM Senior Partner Houston, TX Peter.Belmonte@erm.com 2013 Winston & Strawn LLP 2

3 Impact of USEPA s Proposed Greenhouse Gas Standards for Power Plants 2013 Winston & Strawn LLP 3

4 ERM Working together to meet your environmental, health and safety, risk, and social needs Transaction Services Providing critical, time-sensitive advice on the sustainability risks and liabilities associated with mergers and acquisitions Impact Assessment and Planning Helping to deliver sustainable projects by managing environmental, social, and health impacts Contaminated Site Management Creating strategies and implementing projects to support clients through the life cycle of contaminated site mitigation from initial investigations and risk assessments to remediation Air Quality and Climate Change Helping clients understand and manage the full cycle of effects operations can have on atmospheric environment, including regulatory support to ensure long-term, successful compliance Risk Management Quantifying and managing the safety risks associated with hazardous installations and processes, with the objective of protecting people, assets, and the environment Performance and Assurance Helping corporations reach their environmental, health, and safety performance potential 2013 Winston & Strawn LLP 4

5 Agenda Background on EPA regulations for greenhouse gases Overview of the revised NSPS for new EGUs Key insights and recommendations 2013 Winston & Strawn LLP 5

6 Background on EPA regulations for GHG 2013 Winston & Strawn LLP 6

7 Why is EPA Regulating GHG? 2 April 2007: The Supreme Court determined that GHG are air pollutants under the Clean Air Act. EPA must determine if they threaten public health and welfare (Massachusetts v. EPA) 15 December 2009: The EPA Administrator found that current and projected GHG concentrations endanger the public health and welfare of current and future generations (the endangerment finding ) 23 December 2010: EPA announced a proposed settlement agreement to issue regulations addressing GHG pollution from fossil fuel fired Electric Generating Units ( EGUs ) and refineries 2013 Winston & Strawn LLP 7

8 President Obama s Climate Action Plan Announced in June 2013 Broadly outlines a number of policy objectives, including: Reducing carbon pollution from power plants Building a 21st century transportation sector Cutting energy waste in homes, businesses and factories Reducing methane and hydrofluorocarbons ( HFCs ) Preparing the U.S. for the impacts of climate change Leading international efforts to address global climate change Set flexible carbon pollution standards, regulations or guidelines, as appropriate, for power plants under Section 111 of the Clean Air Act 2013 Winston & Strawn LLP 8

9 What is Section 111 of the Clean Air Act? Provides authority for New Source Performance Standards ( NSPS ) Clean Air Act Section 111(b) Requires EPA to establish emission standards for any category of new and modified stationary sources that the Administrator, in his or her judgment, finds causes, or contributes significantly to, air pollution which may reasonably be anticipated to endanger public health or welfare Clean Air Act Section 111(d) Required for existing sources upon promulgation of a 111(b) standard for new and modified sources in specific circumstances Section 111(d) standard is required for existing sources in the regulated source category (except for pollutants regulated under the CAA Section 109 requirements for national ambient air quality standards or regulated under the CAA Section 112 requirements for hazardous air pollutants) 2013 Winston & Strawn LLP 9

10 NSPS for New Sources Standard reflects the degree of emission limitation achievable through the application of the best system of emission reduction ( BSER ) that the Administrator determines has been adequately demonstrated BSER must take into account: Costs of achieving emission reductions Non-air quality health and environmental impacts Energy requirements EPA may distinguish between classes, types, and sizes of sources in making a BSER determination Each new source must meet the standard once promulgated 2013 Winston & Strawn LLP 10

11 NSPS for Modified and Reconstructed Sources Modification: A physical or operational change that increases the source s maximum achievable hourly rate of emissions Reconstruction: A project replacing components which exceeds 50% of the fixed capital cost that would be required to construct a comparable entirely new facility EPA can delegate NSPS implementation and enforcement to the States Incorporated into air permits, whether issued by States or EPA NSPS are supposed to be reviewed every eight years and, if appropriate, revised 2013 Winston & Strawn LLP 11

12 2012 NSPS Proposal for New Power Plants March 2012: EPA 111(b) standard proposed Proposed a national limit on GHG emissions from new power plants Required performance equivalent to combined-cycle gas turbine ( CCGT ) Technology-neutral limit of 1,000 lb- CO2/MWh gross Over 2.5 million comments submitted on the 2012 proposal 2013 Winston & Strawn LLP 12

13 Overview of the Revised NSPS for New EGUs 2013 Winston & Strawn LLP 13

14 Proposed GHG NSPS for New EGUs Revised proposal released on 20 September Sets national limits on the amount of CO2 that new power plants are allowed to emit Different standards for different types of new EGUs while maintaining a similar level of GHG emissions performance Relies on advanced technologies like natural gas turbines or coal boilers using partial carbon capture and storage ( CCS ) 2013 Winston & Strawn LLP 14

15 Applicability for New EGUs Applies to all new fossil fuel-fired EGUs Utility boilers or stationary combustion turbines More than one-third (33%) of their potential electric output capacity More than 25 megawatts ( MW ) net electrical output to any utility power distribution system for sale Revised threshold tests 3-year rolling average methodology for one-third potential electric output threshold 25 MW net electrical output threshold revised to equivalent net sales threshold of 219,000 MWh per year; also based on 3-year average Applies to any unit commencing construction after the proposed regulation is published in the Federal Register 2013 Winston & Strawn LLP 15

16 Proposed Standards for New EGUs Natural gas-fired stationary turbines 1,000 lb CO2/MWh gross for larger units (> 850 mmbtu/hr) 1,100 lb CO2/MWh gross for smaller units ( 850 mmbtu/hr) Utility boilers and integrated gasification combined cycle ( IGCC ) units 1,100 lb CO2/MWh gross limit on a 12-operating-month period; or 1,000-1,050 lb CO2/MWh gross over a 84-operating-month (7-year) compliance period in exchange for a lower limit of gross Either of the utility boiler/igcc limits would require a new utility boiler or IGCC unit to incorporate some form of CCS technology Proposed rule excludes liquid oil-fired turbines and units which only burn biomass fuels (up to 10% coal mixed) 2013 Winston & Strawn LLP 16

17 Proposed Standards for New EGUs Proposed NSPS would apply at all times except for equipment malfunctions Compliance is based on rolling 12-operating-month averaging period EPA accounted for periods of startup and shutdown by incorporating them as periods of partial load operation Given that the duration of startup or shutdown periods are expected to be small relative to the duration of periods of normal operation and that the fraction of power generated during periods of startup or shutdown is expected to be very small during startup or shutdown periods, the impact of these periods on the total average is expected to be minimal. This could pose a challenge for new units intended for rapid ramping or variable load duties increasingly required to integrate renewable resources (e.g., wind, solar) 2013 Winston & Strawn LLP 17

18 2013 Winston & Strawn LLP 18 Key Insights and Recommendations

19 Implications for Coal and IGCC Plants Puts a standard on future coal plants with partial CCS technology that is not commercially available A current U.S. coal plant average of 1,768 lbs CO2/Mw-hr difficult to cost effectively meet 1,100 lbs CO2/Mw-hr Coal plants can phase in the limits over a 7-yr period as long as they average 1,050 lbs CO2/Mw-hr over that period (84 months) Coal plants would need to capture 20-40% of the CO2 to meet limits; significant costs prevent development of CCS Only 4 coal-fired units have reached the advanced stages of construction and development Not a huge impact in near future due to low cost NG 2013 Winston & Strawn LLP 19

20 Implications for New Turbines New gas turbines subject to the regulation need to utilize waste heat recovery Combined-cycle or combined heat & power ( CHP ) designs Combined heat & power ( CHP ) units Useful thermal output now included in emissions performance computations (prior proposal only included net electric output) Simple-cycle gas turbines ( SCGT ) are now limited April 2012 proposal included a SCGT exemption; now eliminated Effectively prohibits construction of new SCGT greater than 25 MW unless capacity factor is less than 33% (based on new 3-yr tests) 2013 Winston & Strawn LLP 20

21 Simple Cycle Turbine Emissions GHGs BACT Summary for Simple Cycle Turbines Turbine Make/Model Options Without CCS Emission Rate (lb CO2 /MW-hr) Emission Rate (lb CO2 e/mw-hr) GE LMS-100 1,044 1,052 GE LM ,145 1,153 GE 7FA.05 1,176 1,185 Siemens 5000F4 1,177 1,186 GE 7FA.04 1,182 1,191 Pratt & Whitney FT8-3 1,226 1,235 GE 7FA turbine operating in simple cycle mode 1,319 GE LMS-100 simple cycle turbine 1,047 GE LM-6000 simple cycle turbine 1,330 (gas) 1,890 (ULSD) Source: State of Washington Department of Ecology, Technical Support Document for PSD Permit #PSD-11-05, Puget Sound Energy Fredonia Power Generating Station, 30 January 2013 Basis: (a) Natural gas is the only fuel; (b) Turbines are operated under full load conditions, so startups are excluded; (c) Annual hours of operation are 8,760 hr Winston & Strawn LLP 21

22 PSD Permitting and BACT Most new gas turbines are subject to Prevention of Significant Deterioration ( PSD ) permitting under the GHG Tailoring Rule PSD triggers requirement for Best Available Control Technology ( BACT ) 2013 Winston & Strawn LLP 22

23 BACT for GHG BACT is a case-by-case determination Provides considerable discretion to the permitting authority Case-specific and fact-specific Record must justify the decisions reached by the permitting authority EPA does not prescribe GHG BACT for any source type EPA did publish GHG BACT guidance for EGUs Clean fuels need to be considered Feasibility of CCS needs to be considered Focus on energy efficiency as means of reducing GHGs BACT review for new sources extends to non-emitting units Impacts/benefits beyond fence line can be considered NSPS serves as a floor for BACT determinations 2013 Winston & Strawn LLP 23

24 Comparing GHG BACT to Proposed NSPS BACT Guidance for New Turbine EGUs Proposed NSPS for New Turbine EGUs Clean fuels need to be considered Yes No Feasibility of CCS needs to be Yes No considered Focus on energy efficiency as Yes Yes means of reducing GHGs Review for new sources extends to Yes, facility level No, unit level non-emitting units Impacts/benefits beyond fence line Yes No can be considered CO2 emission performance limit based on project specific factors Yes No 2013 Winston & Strawn LLP 24

25 Conclusions Proposed NSPS changes the rules for new turbines Conflicts with some recent GHG BACT determinations Definition of baseload is lower than many State emission performance standards ( EPS ) Capacity factor threshold of 33% v. 60% May pose a challenge for new units intended for rapid ramping or variable load duties (i.e., flexible capacity) Will standard be flexible enough to accommodate a changing power market? 2013 Winston & Strawn LLP 25

26 Recommendations Understand the Federal and State regulatory requirements and how they interrelate NSPS, BACT, State emission performance standards ( EPS ), etc. Clearly define the business purpose for your project Drives the GHG BACT determination; must be thoroughly documented Interveners will use PSD to challenge EGUs (e.g., Sierra Club) Understand how business case impacts EGU performance Efficiency and emissions suffer under low or variable loads Consider environmental permitting issues early in the commercial development stage 2013 Winston & Strawn LLP 26

27 Additional Information Contacts Scott Weaver ERM Bob Fraser ERM Pete Belmonte ERM Toby Hanna ERM Winston & Strawn LLP 27

28 Presidential Memorandum Issued June 25, 2013 along with the Climate Action Plan EPA to issue a new proposed GHG NSPS rule by September 20, 2013, and to finalize it in a timely fashion EPA to issue standards, regulations, or guidelines addressing carbon pollution from modified, reconstructed, and existing power plants by June 1, 2014, with final standards, regulations, or guidelines by June 1, 2015 States to submit SIPs addressing existing power plants by June 30, 2016 EPA to develop approaches that allow for market-based instruments, performance standards, and other regulatory flexibilities 2013 Winston & Strawn LLP 28

29 EPA s Proposed GHG NSPS Rule: Statutory Framework Section 111(b) of the Clean Air Act Requires EPA to publish a list of stationary source categories that cause or contribute significantly to air pollution that may reasonably be anticipated to endanger public health or welfare EPA s position is that 2009 endangerment finding for GHGs from motor vehicles triggered Section 111(b) obligation for new electric utility generating units EPA to propose regulations establishing new source performance standards ( NSPS ) within one (1) year after listing a source category Standard of performance emission limits achievable through use of the best system of emission reduction ( BSER ) that has been adequately demonstrated, taking into account: Costs of achieving emission reductions Nonair quality health and environmental impacts Energy requirements EPA to review NSPS every eight (8) years and revise if appropriate 2013 Winston & Strawn LLP 29

30 2012 GHG NSPS Proposal Coal and natural gas units combined in one source category Stringent limit of 1,000 lb CO2/MWh based on performance of natural gas combined cycle units EPA solicited comments on a limit ranging from 960 lb CO2/MWh to 1,100 lb CO2/MWh Industry comments limit of at least 1,100 lb CO2/MWh for combined cycle units and at least 1,900 lb CO2/MWh for coal units 30-year compliance option that required use of CCS Exemption for transitional units for which construction commenced before April 27, 2012 EPA received over 2.6 million comments Legal challenge brought against the proposed rule (Las Brisas Energy Center, LLC v. EPA) Petitioner argued that the proposed rule was final agency action because under the Clean Air Act, new sources subject to an NSPS are those constructed after the NSPS is proposed, and the proposed rule placed a April 13, 2013 deadline on transitional units to commence construction. Court dismissed the petition as premature 2013 Winston & Strawn LLP 30

31 2013 NSPS Limits at a Glance Type of Unit NSPS Limit BSER Fossil fuel-fired boilers and IGCC units 1,100 lb CO2/MWh ~OR~ 1,050 lb CO2/MWh (over an 84-month rolling average) Partial CCS Stationary combustion turbines with a design heat input greater than 250 MW (850 mmbtu/hr) Stationary combustion turbines with a design heat input 73 MW (250 mmbtu/hr) and 250 MW 1,000 lb CO2/MWh NGCC 1,100 lb CO2/MWh NGCC 2013 Winston & Strawn LLP 31

32 Major Differences Between the 2012 and 2013 Proposals Separate standards for utility boilers and IGCC units and natural gas-fired stationary combustion turbines The 2012 proposal would have imposed a 1,000 lb CO2/MWh emission limit on all fossil fuel-fired power plants, based on the BSER of NGCC 30-year compliance option eliminated (1,800 lb CO2/MWh for first 10 years, followed by 600 lb CO2/MWh for the remaining 20 years) and replaced with 7- year average 1,050 lb CO2/MWh option No exemption for transitional units since most had not yet commenced construction, with three possible exceptions: The proposed Wolverine project, and potentially the Washington County and Holcomb projects, would still be exempt from the rule as long as they commence construction prior to the finalization of the rule Separate BSER determinations Justified because of further progress of CCS projects and need to preserve fuel diversity through continued use of coal 2013 Winston & Strawn LLP 32

33 Major Differences Between the 2012 and 2013 Proposals, cont d Structure of the rule EPA is accepting comment on including the NSPS in existing Subparts Da or KKKK, or, in new Subpart TTTT (but with separate categories for coal and natural gas-fired units) Applicability No exclusion for simple cycle combustion turbines, because the vast majority sell less than 1/3 of their potential electrical output, but EPA is soliciting comment on whether to include an explicit exclusion EPA added the requirement that the unit actually supplies more than 1/3 of its potential electric output to the grid, in addition to the requirement that the EGU be constructed for the purpose of supplying more than 1/3 of its potential electric output to the grid, which was in the 2012 proposal For stationary combustion turbines, EPA is proposing a three-year averaging period for electric sales instead of annual sales EPA is proposing a definition of potential electric output that would allow sources to calculate potential electric output based on actual design electric output efficiency on a net output basis, rather than on 1/3 of potential electric output, to encourage the construction of more efficient facilities 2013 Winston & Strawn LLP 33

34 What Hasn t Changed Despite the legal refinements, from a practical standpoint, the 2013 proposal is very similar to the 2012 proposed rule Actual limits are very similar, and for some units, identical to the 2012 proposal New coal-fired power plants would still need to use CCS No requirements for modified or reconstructed units Affirmative defense for violations caused by malfunctions (but EPA is accepting comment on whether to apply the defense to the 84-month rolling average period) 2013 Winston & Strawn LLP 34

35 Potential Comments EPA assumes that no new coal generation will be permitted and based CO2 emissions rate analysis on IGCC and synfuel units using CCS for enhanced oil recovery ( EOR ) Proposal ends any new traditional coal generation Policy decision to turn our backs on coal resources Severely impacts coal states CCS not adequately demonstrated Even if CCS were viable, 1,100 lb CO2/MWh or 1,050 lb CO2/MWh (84-month average) cannot be achieved 2013 Winston & Strawn LLP 35

36 Proposed Comments EPA s cannot rely on facilities that are not yet complete as justification for selecting CCS as the best system of emission reduction ( BSER ) EPA claims that Southern Company s Kemper County Energy Facility is 75% complete, but the owner recently announced the facility will not be completed by the May 2014 deadline Due to the delay in meeting the completion deadline, the owner will now have to repay $133 million in Federal tax credits. These issues raise concerns over whether the project will actually be completed EPA cannot use non-egu facilities such as coal gasification facilities as support for its argument that CCS is adequately demonstrated With no new coal-fired units being constructed, there will be no incentive to invest in CCS 2013 Winston & Strawn LLP 36

37 Potential Comments Proposed standard for stationary CTs too stringent. Best new CT technology cannot meet the 1,000 to 1,100 lb CO2/MWh limits. Thus, utilities no longer have the option to quickly add CTs to increase capacity and are forced to exclusively add NGCC More difficult to permit, more costly, much longer timeline Not clear that new NGCC units can meet the 1,000 to 1,100 lb CO2/MWh limits 2013 Winston & Strawn LLP 37

38 Potential Comments Addition of heat recovery steam generators to existing combustion turbines should not be covered Period of startup and shutdown should be excluded Periods of malfunctions should be excluded (as opposed to just being eligible for an affirmative defense) EPA needs to recognize that NSPS proposal will serve as a floor for GHG BACT determinations if Supreme Court upholds GHG Timing and Tailoring rules EPA cannot exclude application of the NSPS to modified and reconstructed units 2013 Winston & Strawn LLP 38

39 Potential legal challenges BSER of partial CCS is not adequately demonstrated Is the Kemper County project sufficient proof that CCS has been adequately demonstrated? An Endangerment Finding for GHG emissions from electric utility generating units is required, and the 2009 Endangerment Finding for motor vehicle GHG emissions does not justify proposed GHG NSPS EPA position in response: No new source category is proposed under either option of separate GHG standards within Subparts Da and KKKK, or combining the two source categories in a new Subpart TTTT; therefore, no Endangerment Finding is required Only a rational basis for the regulation is required, and the rational basis exists due to the 2009 Endangerment Finding, and because the power plants are the largest GHG emitters Even if an Endangerment Finding is required, the rational basis constitutes an Endangerment Finding, and the D.C. Circuit recently upheld the 2009 Endangerment Finding (Coalition for Responsible Regulation v. EPA (26 June 2012)) 2013 Winston & Strawn LLP 39

40 Potential Litigation Timeframes for New Source Rule Rule final prior to June 1, 2014 Petition for review in D.C. Circuit Court of Appeals 60 days after final rule D.C. Circuit Court of Appeals decision ~2016 Petition for certiorari ~2016 Supreme Court decision ~2017 or Winston & Strawn LLP 40

41 Existing Source GHG Standards Statutory and regulatory framework CAA 111(d)(1)(A) requires EPA to issue procedural regulations under which the States submit a plan which (A) establishes standards of performance for any existing source for any air pollutant (1) for which air quality criteria have not been issued or which is not included on a list published under 7408(a) [PSD criteria pollutants] or emitted from a source category which is regulated under section 7412 of this title [Section 112 listed HAPs source categories] but (ii) to which a standard of performance under this section would apply if such an existing source were a new source. EPA regulations require the Administrator to issue emission guidelines upon or after proposing NSPS for new sources, which must include information for the development of State plans. 40 C.F.R (a) 2013 Winston & Strawn LLP 41

42 Existing Source GHG Standards, cont d Emission guidelines include: A description of emission reduction systems that have been adequately demonstrated Information on the degree of emission reduction achievable with each system Regulations shall permit states to take into consideration, among other factors, the remaining useful life of the existing sources subject to the regulations State Attorneys General White Paper (signed by 18 State Attorneys General. including the Kentucky Attorney General) EPA does not have the authority to set prescriptive GHG emission standards for existing sources under 111(d) Real question as to whether EPA can regulate electric utility sources or other Section 112 listed HAP categories since 111(d) explicitly excludes these source categories Open question as to whether cap-and-trade programs and beyond the fence line approaches meet definition of standards of performance and can be considered BSER 2013 Winston & Strawn LLP 42

43 Existing Source GHG Standards, cont d EPA currently in talks with States and stakeholders Soliciting input on its website and via at carbonpollutioninput@epa.gov Recently issued questions for discussion inform EPA's thinking Can existing GHG-reduction programs such as RGGI and California's cap-and-trade program satisfy the Section 111(d) requirements? What type of performance standard should be set (supply-side energy efficiency improvements, end-use energy efficiency improvements)? Should it be rate-based or mass-based? Uniform level or differing by state/region? What level of flexibility should be provided to the states? Should states be allowed to achieve emissions reductions by actions outside the regulated entities, such as renewable energy or end-use energy efficiency? What enforceability, measurement, and verification issues might arise? Should states submit individual plans or regional/multi-state plans? 2013 Winston & Strawn LLP 43

44 Regulatory and Litigation Timeframe for Existing Source Rule Rulemaking schedule under presidential memorandum Proposed June 1, 2014 Final June 1, 2015 State implementation plans ~June 2018 Litigation over the rule Expect the existing source rule to be more vulnerable to legal challenge than the new source rule due to statutory constraints on EPA s authority regarding existing sources Petition for review filed after final rule issuance in 2015 D.C. Circuit Court of Appeals Decision ~2017 Petition for certiorari ~2017 Supreme Court decision ~2018 or 2019 Potential compliance ~ Winston & Strawn LLP 44

45 New Supreme Court GHG Case On October 15, 2013, the Supreme Court accepted six appeals of the D.C. Circuit Court s Coalition for Responsible Regulation v. EPA decision upholding the 2009 Endangerment Finding and a suite of EPA GHG rules The cases will be consolidated for review and are limited to one fairly narrow question: Whether EPA permissibly determined that its regulation of greenhouse gas emissions from new motor vehicles triggered permitting requirements under the Clean Air Act for stationary sources that emit greenhouse gases The Court decided not to re-consider Massachusetts v. EPA, which established EPA s authority to regulate GHGs under the Clean Air Act, or EPA s issuance of the Endangerment Finding The case is not expected to impact the GHG NSPS rules 2013 Winston & Strawn LLP 45

46 New Supreme Court GHG Case UARG argues that PSD requirements only apply to pollutants for which there can be a deterioration of the quality of the air that people breathe (i.e. criteria pollutants for which EPA has promulgated a NAAQS), therefore GHGs cannot be PSD pollutants. ACC argues that GHGs can be regulated under PSD permits but only if PSD is triggered by major sources of NAAQS PSD pollutants, not GHGs Avoids necessity for absurd results, administrative necessity, and one step at a time doctrines to rewrite the CAA EPA and environmental community arguing that PSD permitting triggered for any pollutant subject to regulation under the CAA because of Massachusetts v. EPA and the 2009 Endangerment Finding 2013 Winston & Strawn LLP 46

47 New Supreme Court GHG Case Potential impact on GHG NSPS and Section 111d rules: EPA s Timing Rule, in which it interpreted the Tailpipe Rule as a trigger for PSD permitting for GHGs, will be the focus If the Court holds that the Tailpipe Rule did not trigger stationary source permitting requirements, because EPA did not have the authority to make GHGs a PSD pollutant, then EPA did not have the authority to promulgate the Tailoring Rule Proposed GHG NSPS rule will set emission limits for new units but does not directly establish PSD permitting requirements 2013 Winston & Strawn LLP 47

48 New Supreme Court GHG Case In AEP v. Connecticut, the Court held that Section 111 of the CAA provided means to seek limits on emissions of carbon dioxide from domestic power plants the same relief the plaintiffs seek by invoking federal common law. We see no room for a parallel track. Thus the Court already has recognized EPA s authority to regulate GHGs under 111(a) and (d) Some headline-grabbing comments notwithstanding, Section 111 rules not likely impacted 2013 Winston & Strawn LLP 48

49 GHG Tailoring Rule Biomass Deferral In Center for Biodiversity v. EPA, D.C. Circuit struck EPA s three-year deferral from GHG Tailoring rule for new or modified major biomass sources (7/8/13) Mandate deferred until Supreme Court acted on cert. petition in UARG v. EPA case Industry intervenors now have until 11/15/13 to 11/15/13 to file a petition for the D.C. Circuit to review en banc On 10/22/13, industry filed a petition seeking delay in proceedings until after the Supreme Court resolves UARG v. EPA case in June Winston & Strawn LLP 49

50 2013 Winston & Strawn LLP 50 Questions?

51 2013 Winston & Strawn LLP 51 Thank You.

52 Contact Information Jay Holloway Winston & Strawn, Partner Environmental Practice Group Washington, D.C. (202) Peter Belmonte ERM, Senior Partner Houston, TX (832) Winston & Strawn LLP 52