Environmental Update:

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1 Environmental Update: The Good, The Bad, and The Ugly gy Ashley B. Peterson, Ph.D. Director of Regulatory Affairs American Meat Institute October 28, 2010

2 Environmental Update The Good, The Bad, The Ugly. Administration vs. Agency vs. Hill vs. Media ALL versus Animal Agriculture Air and Water Issues Greenhouse Gas Regulation/Legislation Watershed Issues Chesapeake Bay TMDL and Florida Nutrient Standards Particulate Matter, CAFO Regulations, Dioxin, etc

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4 Who is the American Meat Institute? National trade association that represents companies that process 95 percent of red meat and 70 percent of turkey in the U.S. and their suppliers throughout America. Headquartered in Washington, DC Track legislation, regulation, and media activities that impacts the meat and poultry industry AMI Foundation conducts and funds scientific research designed to help meat and poultry companies improve their plants and their products.

5 Let s start t with GHGs.

6 Greenhouse Gases

7 Where do GHG s come from? Boilers Wastewater Treatment Facilities and Lagoons Lairage/yards CO 2 Stunning Systems Rendering Refrigeration Fleet Vehicles Sludge Application Blending Implementation of Best Available Control Technologies (BACT)

8 Source Where do GHG s come from? Electricity Generation 33.5% Transportation 26.4% Industrial 11.8% Residential 4.8% Commercial 30% 3.0% Agriculture Soil Management 2.9% Animal Agriculture* 2.8% Landfills 1.9% Non-Energy Use of Fuel 1.9% Other 11% Percent Contribution (*Includes enteric fermentation and manure management) Source: EPA Inventory of U.S. Emissions and Sinks ( )

9 Another View

10 Breakdown of Animal Agriculture s 85.4% of all GHG emissions from CO 2 94% from fossil fuel combustion Insignificant ifi contribution ti from animal agriculture 8.2% of all GHG emissions from CH % from animal agriculture 4.4% of all GHG emissions from N 2 O 4.7% is from animal agriculture (manure management) Contribution

11 Challenges We Face The Livestock sector is a major player, responsible for 18% of GHG emissions i measured in CO 2. This is a higher share than transport (UN FAO 2006) Which is responsible for more global warming: your BMW or your Big Mac? Believe it or not, it s your Big Mac (Time, 2007) A 16 oz T-bone is like a hummer on a plate. Switching to vegetarianism can shrink your carbon footprint by 1.5 tons of CO 2 per year (Time, 2007)

12 There is hope FAO has since retracted their statements. Maurice E. Pitesky, Kimberly R. Stackhouse, and Frank M. Mitloehner. Clearing the Air: Livestock s Contribution to Climate Change in Advances in Agronomy, Vol intensification of livestock production provides large opportunities for climate change mitigation and can reduce greenhouse gas emissions from deforestation, thus becoming a long-term solution to a more sustainable livestock production. Other work encouraging concentration, improved efficiencies of scale, etc.

13 The Facts GHG emissions from animal agriculture have remained relatively l constant t over the past 20 years Increase in meat production by 50% Increase in milk production by 16% Increase in egg production of almost 33% How? Improved feed efficiencies i i Better manure management More efficient use of cropland Improved genetics for animals and crops Fact Sheet posted at on this topic and many others

14 What is EPA doing about GHGs?

15 GHG Reporting Program Oct 30, 2009 EPA published a rule for mandatory reporting of GHG from large sources EPA says this will help them obtain a better understanding of where GHGs come from (defining a target?) Must report annually if a facility emits over 25,000 tons CO 2 EPA estimates this will cover 85-90% of emissions First reports due to EPA by March 31, 2011 for data collected in the previous year Need Help? Electronic GHG reporting tool: eggrt

16 EPA s Regulatory Priorities Endangerment Til Tailoring i Rl Rule Finding Light-Duty Vehicle Rule Johnson Memo

17 Endangerment Finding In response to the April 2007 Supreme Court decision, Massachusetts v. EPA, which directed EPA to determine if GHG emissions from motor vehicles cause/contribute to air pollution and endanger public health or welfare. EPA: Under section 202(a) of the Clean Air Act, GHGs threaten public health and welfare and GHG emissions from motor vehicles contribute to the threat. December 2009, the Endangerment Finding was finalized indicating that GHGs threaten public health and welfare and emissions of these GHGs from motor vehicles contribute to GHG pollution which also threatens public health and welfare. The finding paves the way for the EPA to finalize GHG standards for light-duty vehicles.

18 Light-Duty t Vehicle Standard d Endangerment Finding paved the way for the implementation and finalization of the Light-Duty Vehicle Standard (April 1, 2010). Light-Duty Vehicle standard made GHG emissions subject to regulation under the Clean Air Act for the first time. Sets emission standards for new vehicles from 2012 to Under the CAA, air pollutants that are subject to regulation under the statute are subject to the Act s PSD/NSR permitting and Title V operating permit provisions for stationary sources.

19 Johnson Memo Rule Bush-era memo from EPA Administrator, Stephen Johnson Addressed when the Clean Air Act PSD program would cover a pollutant including GHGs Memo indicated that the PSD program would apply to pollutants that are subject to either a provision in the CAA or a regulation adopted by the EPA under the CAA. EPA: Regulation of GHG tailpipe emissions triggers full PSD/Title V regulation of GHGs from all sources

20 Tailoring Rule On September 30, 2009, EPA announced a proposal that would require facilities emitting over 25,000 tons/year to obtain permits that would demonstrate they are using the best practices and technologies to minimize emissions. EPA claims that without the tailoring rule schools, hospitals, small farms, and restaurants would be subject to Title V and PSD permitting. On May 13, 2010, EPA released the final rule and increased the threshold to 75,000 tons/year and facilities below this threshold would not be required to obtain an operating permit.

21 EPA s Regulatory Priorities Endangerment Til Tailoring i Rl Rule Finding Light-Duty Vehicle Rule Johnson Memo

22 Political Pressure

23 Political Pressure In response to a letter written by Democratic Senator Jay Rockefeller, EPA decided d to gradually phase in GHG regulations for fear of harming the economy. EPA agreed that it would not phase-in permit requirements for GHG s for large stationary sources until In the first half of 2011, only those facilities which must apply for CAA permits as a result of non-ghg emissions will need to address GHG emissions. EPA does not expect to regulate the smallest source to GHG permitting any sooner than 2016.

24 Political Pressure Senator Lisa Murkowski (R-AK) Rarely used congressional resolution of disapproval An attempt to block EPA s ability to regulate greenhouse gas emissions under its current Clean Air Act powers Voted on June 10, 2010 Did not pass

25 Kerry/Lieberman Legislation Newest climate change legislation Introduced May 12, ,000 pages long EPA s economic analysis claims minimal i impact Concerns from industry include: Offshore drilling Stability of the carbon market Impact on jobs Distribution of carbon allowances Chances for passage?

26 Congress is in recess Current Status Lame duck session? What will happen? Senator Harry Reid (D-NV), if he is re-elected, claims he will try a piecemeal approach to passing climate related legislation Chances in 2011? Depends on November 2 nd elections. Political forecasting???

27 218 Needed for Majority Projections 190 Blue 198 Red 47 Toss Up

28 51 Needed For Majority Projections 46 Blue 2 Independent 44 Red 8 Toss Up

29 Obama Administration s s Push Push for an energy policy in 2011 Will veto any legislation that hinders the authority of EPA Continue to talk up climate change Executive Orders: October 5, 2009 GHG reduction target for the 500,000 federal buildings, 600,000 vehicles, and 1.8 million employees for May 12, 2009 Chesapeake Bay Protection and Restoration. Final strategy to make all waters in the Bay fishable and swimmable by one year from the order. Strong emphasis on agriculture.

30 Chesapeake Bay TMDL EPA published its Draft Chesapeake Bay TMDL on September 24, 2010 Sets 522 separate TMDLs for a 64,000 mile 2 area in almost 2,000 pages Model TMDL for all other watersheds in the U.S. Allowing for a 45-day comment period (Due Nov. 8) Requested extension to 120 days EPA will establish TMDL by December 31, 2010 Why the urgency? Chesapeake Bay Foundation Lawsuit and Settlement

31 Chesapeake Bay TMDL Threatens to impose allocations on small entities that t raise more than ONE animal Sets unachievable limits on N, P, and sediments (pre-colonial) Used a flawed model with incomplete/incorrect information i and assumptions on agriculture practices in Bay EPA is being secretive Have seen substantial reductions in nutrient and sediment loss to the bay over the past 25 years

32 Florida Proposed Nutrient Standards On January 26, 2010 EPA published a notice of proposed rulemaking to establish water quality standards for Florida s lakes and flowing waters First time EPA has attempted to displace state efforts by establishing federal numeric nutrient criteria UF estimates it will cost up to $974 million annually for Florida s agriculture industry to meet the criteria plus a $631 million loss in revenue! Set standards below background levels. Complete disregard of EPA s SAB

33 Dioxin Complete disregard of EPA s SAB and the NAS EPA concluded that dioxin is carcinogenic to humans On January 7, 2010, EPA published a draft interim soil standards stating that 90% of human exposure to dioxin occurs through consumption of food, primarily from beef, dairy, poultry, eggs, fish, and pork. On May 21, 2010, EPA released its dioxin reassessment setting limits below WHO standards. If the Agency were to set its regulations based on the reassessment it would mean no food would be safe for consumption.

34 EPA Enforcement Priorities One of six enforcement priorities is to focus on ensuring that t Concentrated t Animal Feeding Operations (CAFOs), about 19,000 operations, comply pywith the CWA requirements to protect surface waters from animal waste. This priority was a priority but enforcement was sporadic and small.

35 CAFO Regulations Current CAFO Rule published in November 2008 Published in response to a court decision i that t ruled the CWA regulated actual discharges and not potential discharges. Language dealing with no discharge certification option in the 2008 rule. It was an option created, voluntary to producers, so a producer could show EPA that they went through an objective process to establish they are not discharging or proposing to do so. It buys the farmer some protection if in the event of a future discharge (limits their CWA liability).

36 CAFO Regulations EPA signed settlement agreement with environmental groups on May 28, 2010 and developed an Implementation Guidance on CAFO Regulations CAFOs That Discharge or Propose to Discharge In the Guidance The no discharge certification is a voluntary option for CAFOs that are not subject to NPDES permitting requirements. Therefore, states are not required to adopt the certification option into their CAFO program. How can the no discharge certification be voluntary if the state chooses not to offer it? If the state chooses not to offer it, then the producer has no option whatsoever.

37 Dust/Particulate Matter Regulations EPA is reviewing its airborne pollutant standards, as required every five years under the CAA. Tiny particles of industrial pollution Coarse particulate matter" that include dust For dust, EPA s SAB recommend a standard of micrograms/m 3 as opposed to the current 150 micrograms/m 3 Proposed changes to be announced in February 2011 with a final rule published in October The EPA said in a statement that it is "committed to issuing air quality standards for particle pollution that are scientifically sound."

38 Others.. The NOx and SOx Secondary National Ambient Air Quality Standards (NAAQS) Review Panel of the EPA Clean Air Scientific Advisory Committee (CASAC) is holding public hearings Boiler MACT -set stringent t emission i limits it for hazardous air pollutants from industrial, commercial, and institutional boilers that combust fossil fuels and biomass. EPA/DOT Fuel Standards for heavy duty trucks and buses (October 25, 2010) 20 percent reduction in CO 2 emissions and fuel consumption by 2018 model year EPA Blend Rate for ethanol

39 QUESTIONS?