No doubt the President’s budget includes a very ambitious proposal cap and trade proposal to address Climate Change. The President Budget provides an overview of the proposal in the EPA budget:
After enactment of the Budget, the Administration will work expeditiously
with key stakeholders and Congress to develop an economy-wide emissions reduction program to reduce
.jpg)
I have been following discussion regarding the green elements of the .jpg)
Presidents Stimulus Package, known as the American Recovery and Reinvestment Act of 2009. There is certainly a lot directed toward environmentally related projects, especially renewable energy development. Leading some to call these provisions the "Green New Deal."
What is the real story behind some of the spending that has been reported? You certainly can find information all across the web and on government sites that simply lists the amount of money in the bill and which program it has been directed. However, detail about what the money will really be used for can be hard to find.
Bottom line, some provisions are better than others. For instance, much of the money directed toward U.S. EPA will pay for existing projects. This includes prior grant applications, clean ups already under contract or projects previously selected for funding. So, for many of you expecting great new opportunities for EPA related projects, I don’t think the bill offers you that much. (with the exception of diesel engine related grants- see below).
The renewable energy side of the equation is a totally different story. There are continued and new tax incentives as well as new grant opportunities. There is a lot in the bill and it will literally pay to stay on top of what is available.
I. EPA Side- the American Recovery and Reinvestment Act of 2009 specifically includes $7.22 billion for projects and programs administered by EPA.
Below is a description of the major areas of funding as well as an analysis of whether this funding presents new opportunities. EPA has established a web site page with helpful links that discuss the opportunities in the Stimulus Bill relative to the money designated for EPA.
Brownfields: There is over $100 million directed to U.S. EPA’s brownfield redevelopment program. I was intrigued regarding this new slug of money for it could present another great opportunity for clients outside of the Clean Ohio program. However, after asking for more details from U.S. EPA, I learned that this money is basically already spent. The U.S. EPA intends to use it for projects that requested funding back in 2008 but were not funded due to an over abundance of proposals. While its good news more projects are getting funded, I believe U.S. EPA could have even received better project proposals if they would have allowed for new applications.
Diesel Emission Retrofits Act (DERA): The Stimulus directed over $300 million in new money to fund the DERA program. DERA is the federal grant program that pays for diesel engine retrofits, repowers and replacements. Last years allocation was only $50 million for the entire country. So the Stimulus does provide real, new money for this program. U.S. EPA intends to spend the money quickly so watch U.S. EPA’s website and Recovery.gov to jump in with your project.
Underground Storage Tank (USTs) Cleanups: $200 million was provided to U.S. EPA’s Leaking Underground Storage Tanks (LUST) Program, EPA provides resources to states and territories for the oversight, enforcement and cleanup of petroleum releases from underground storage tanks (USTs). EPA estimates that every year 7,570 new releases occur which just adds to the sites that have not yet been completed. There could be as many as 116,000 sites requiring clean up actions in 2009. However, it appears the funding will be used to help pay for clean ups of abandoned tanks rather than create a new grant program. Here is additional detail from the from the Convenience Store News regarding the Stimulus package:
Other measures relevant to c-stores include a final approval of $200 million for the Leaking Underground Storage Tank (LUST) Trust Fund, which assists in the cleanup of abandoned gas stations, but will not pay for inspections or to assist state reimbursements programs.
Superfund Cleanups: $600 million was provided to U.S. EPA’s superfund program. However, these funds will be obligated mostly through existing contracts and Interagency Agreements. In 2009 there could be as many as 20 Superfund sites ready for construction, but not funded due to budget shortfalls. The Recovery funds will begin to address those sites, plus accelerate construction at many of 600 sites where work has been limited in the past by funding constraints.
Clean Water State Revolving Fund and Drinking Water State Revolving Fund: $4 billion for assistance to help communities with water quality and wastewater infrastructure needs and $2 billion for drinking water infrastructure needs. A portion of the funding will be targeted toward green infrastructure, water and energy efficiency and environmentally innovative projects. (guidance on the green infrastructure component)
Ohio EPA has begun soliciting projects for its Drinking Water and Wastewater Revolving Loan Programs. However, projects must already have been planned and reviewed by Ohio EPA for inclusion on project planning lists. For instance, drinking water projects must be on the Drinking Water Project Priority List (PPL).
II. Renewable Energy- the American Recovery and Reinvestment Act of 2009 bill is anticipated to provide around $43 billion for renewable energy in the form of tax breaks and other incentives
The extended entry includes a summary of the renewable energy incentives and investment as assembled by the American Council on Renewable Energy (ACORE). (the link provides you a hard copy of the ACORE document- which does a great job of assembling the relevant information for renewable energy incentives- or see the extended entry for a summary).Continue Reading Green New Deal? Green Trinkets and Empty Packages in the Stimulus Bill
May you live in interesting times….Yesterday EPA Administrator Jackson issued a letter granting the Sierra Club’s petition for reconsideration of a Deseret Power memo issued by former EPA Administrator Johnson. The Petition seeks reconsideration of the Johnson memo which interpreted EPA regulations defining the pollutants covered by federal permitting under the Clean Air Act. The Johnson
There is good news for area businesses. Additional compliance costs and restrictions on economic growth will be avoided that were deemed all but certain a few years ago. The compliance costs were associated with new air pollution controls needed to achieve U.S. EPA’s 1997 8-hour ozone standard (0.85 ppm). The deadline to meet this
There has been major developments as a result of litigation, policy, rulemaking and legislation in the last few weeks relating to climate change and coal fired power plants. Some changes are a result of outstanding litigation. However, the most significant changes are indicative of the sea change that is occurring at the federal level under
I am attending the 12th annual EUEC (Energy and Environment Conference) in Phoenix for the early part of this week. I guess they had to move the conference from previous venues to the Phoenix Convention Center to accommodate the large number of registrants. There are over 450 different speakers and presentations.
My observations from the
In remarks titled "from peril to progress", the President set forth bold action yesterday that will inevitably lead to full regulation of CO2 and greenhouse gas emissions. The President ordered a "vigorous review" of California’s request to regulate greenhouse gas emissions which had been previously denied by the Bush Administration. [President Obama’s memo ordering a
On January 13, 2009, Judge Lacy Thornburg of the District Court for the Western District of North Carolina issued a major decision in case of North Carolina v. TVA. When filed, this case was seen as another chapter in the on-going battle between downwind and upwind states over cross-border pollution.
However, the decision and implications
With recent developments in climate change litigation, including the Deseret Power decision, it appears we are moving ever closer to requiring control of CO2 from coal fired power plants and other major sources of CO2. Outgoing EPA Administrator Johnson may have delayed things temporarily by issuing his memo in response to Deseret Power. However, incoming EPA Administrator Jackson has pledged to quickly review the California waiver request that would allow the State to set CO2 emission standards for cars. If that happens, the dominoes will soon fall requiring controls for CO2 for all major sources under the Clean Air Act.
A positive "endangerment finding" in response to the California Waiver request will trigger a host of other regulations. Those would include requiring emission controls from new major sources of CO2 and other greenhouse gases under EPA’s New Source Review permit program.
If new or modified sources are required to control CO2, then as part of their permit they will be required to install Best Available Control Technology (BACT) to reduce CO2 emissions if located in an area that meets federal air quality standards. More stringent limits (Lowest Achievable Emission Rate- LAER) apply in areas that don’t meet air quality standards.
The focus of all the recent litigation has been on whether to require CO2 controls as part of a BACT permit review. But that begs a very interesting question….What would BACT be for CO2?
I was asked this very question during a recent interview I had with a reporter from Inside EPA. That sent me to research the issue. My review shows to things: 1) there is a wide divergence of opinion among experts as to what BACT would likely be; and 2) EPA has a fair amount of discretion to determine the BACT standard for CO2. Once it is decided that BACT must be required to control CO2 (and other greenhouse gases), Industry insiders expect EPA would take at a minimum 6 months to decide the issue.
Reading the tea leaves, I think we can begin to decipher an answer as to what BACT may constitute. We certainly can eliminates some suggestion offered by pundits based upon how EPA has applied the BACT standard in the past. Here is what we know….
Now lets turn to a review of experts who have offered their opinion as to which technologies should be considered BACT for CO2. Here is one guess from the blog Cleanergy.org:
BACT for CO2 is unlikely to mean carbon capture and storage (yet), since it’s not readily available, but it will probably mean some combination of co-generation (making use of waste heat from electricity generation), efficiency improvements, and/or fuel switching/co-firing with biomass. Ultimately, President-elect Obama’s EPA gets to decide how BACT is defined for CO2, a process which will take at least a year.
Joseph Romm, author of the blog Climate Progress, offered his opinion of what BACT for CO2 may look like.
Certainly it is going to slow down the permitting of any new coal plant dramatically, until the EPA figures out the answer to the $64 billion question: What is BACT for CO2 for a coal plant? That will probably take the Obama EPA at least 12 months to decide in a rule-making process. But from my perspective it could/should/must include one or more of:
a) Co-firing with biomass — up to 25% cofiring has been demonstrated
b) Highest efficiency plants
c) Cogeneration (i.e. recycled energy)
d) (possibly even) Gasification with, yes, carbon capture and storage (CCS)
Here are some other opinions as to possible technologies that would qualify as BACT for coal-fired power plants:
But let’s look at the legal guidance associated with BACT. In doing so, some of the technologies suggested seem "not ready for prime time" or would not be considered a control technology but rather a different type of generation.
BACT is determined through a case-by-case evaluation of control technology alternatives and involves a complicated weighing of economic, environmental, energy and other factors. BACT can even be no control measure if that weighing process fails to identify a technically and economically feasible technology for controlling the pollutant in question.
A detailed discussion of the permitting process and legal aspects of a BACT analysis is provided below. The single biggest consideration is that BACT takes the project as proposed and establishes the lowest achievable emission rate for the various pollutants.
This means BACT cannot fundamentally change the design of the proposed project. This is why EPA has rejected establishing IGCC as BACT. If the permit applicant is proposing a traditional pulverized coal boiler, then limits must be established based upon what is achievable for that type of boiler.
This eliminates many of the control technologies suggested by pundits:
Some other technologies are more likely to be considered BACT:
On January 15, 2009 the Sierra Club filed a petition in the D.C. Circuit Court of Appeals challenging EPA Administrator Johnson’s memo in response to Deseret Power. The petition seeks the Court to throw out the Johnson memo. The memo would allow current permits to proceed without considering controls for CO2 or other greenhouse gases.
If