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GHG Utility Regulation Worries Manufacturers

Green Manufactuer...Sept./Oct. 2012

Manufacturers are up in arms about a proposed rule from the EPA which would set an emissions
standard on carbon dioxide for new electric plants. If finalized, the standard--another of the EPA's dribbled
out greenhouse gas regulatory rulemakings--would affect only electric utilities, and then only those who did not meet an emission rate of 1,000 lb CO2/MWh of electricity generated on a gross basis.
So why are manufacturers gnawing on their finger nails? Their angst has to do with concern that the EPA, in the future, may apply this 1000 lb. CO2/MWh standard to boiler units in their facilities. Additionally, they think that if the EPA finalizes the rule electric costs for manufacturers will go up as coal-burning facilities purchase and deploy expensive control equipment.

In combined comments to the agency, the National Association of Manufacturers, U.S. Chamber of Commerce and other trade groups pressed the EPA to withdraw the proposal because of "...the impact these regulations will have on energy prices and reliability, as well as the potential precedent-setting nature of the approach on manufacturing sectors in the future." The EPA argues that the utility industry will be able to build new plants which use coal or petroleum, though the costs may be a bit higher than they will be for natural gas fueled generating plants. That is because the proposed rule will require (as a de facto matter) new coal-fired boilers to employ carbon capture and storage (CCS) technology. The manufacturing groups argue the EPA has acted " arbitrarily, capriciously, and unlawfully" by favoring ( again, in a de facto way) natural gas over coal and petroleum.

But EPA Delays Application of Another GHG Rule

To be fair to the EPA, it is important to note that it is also showing restraint with regard to some GHG regulatory proceedings. The agency announced that it would not reduce the size of companies forced to obtain one of two kinds of permits when they either build a new plant or modify an existing one so that the total emissions of air pollutants (that is GHGs and other toxics such as ) exceed a certain level. The EPA had previously set applicability thresholds at total emissions above 100,000/75,000 tons per year. Those levels were established in the "tailoring rule" the agency published in December 2010. At that time, it said it would reduce those triggers in July 2012. But when July 2012 came around, the EPA reversed itself, saying it would not lower the triggers because the states would not have the resources to handle the flood of permits they would receive. The two EPA permitting programs involved here are the "Prevention of Significant Deterioration" and "Title V" programs.