EPA – GHG Accounting

U.S. EPA Accepts Electronically Submitted GHG Reports

The U.S. Environmental Protection Agency (EPA) has launched a new tool to allow 28 industrial sectors to submit their 2010 greenhouse gas (GHG) emissions data electronically. Prior to being finalized, the electronic GHG Reporting Tool (e-GGRT) was tested by more than 1,000 stakeholders (including industry associations, states and non-governmental organizations) to ensure clarity and user-friendliness.

The data collected with e-GGRT will provide information about the nation’s largest stationary sources of GHG emissions. Industries and businesses will also be able to use the data to help find ways to decrease carbon emissions, increase efficiency and save money.

The EPA expects to receive 2010 GHG data from approximately 7,000 large industrial GHG emitters and suppliers, including power plants, petroleum refineries and landfills.

EPA’s GHG Reporting Program, launched in October 2009, requires the reporting of GHG data from large emission sources across a range of industry sectors. Suppliers of products that would emit GHGs if released, combusted, or oxidized are also required to report GHG data. Under this program, covered entities are required to submit GHG data to EPA annually and the first round of data will be submitted electronically by September 30, 2011. The EPA plans to publish non-confidential GHG data collected through the GHGRP by the end of 2011. More information is available at: Link

U.S. EPA Defers Deadline to Report Factors Used to Calculate GHG Emissions

The U.S. Environmental Protection Agency (EPA) is deferring the deadline for several industries to disclose factors they used to calculate their 2010 greenhouse gas (GHG) emissions. The agency has established two deadlines for industries to report the inputs for calculations they performed to comply with the EPA’s mandatory reporting rule (40 C.F.R. Part 98), while the EPA continues to evaluate industry concerns about revealing potentially confidential business information. For factors the EPA said can be quickly evaluated, industries will be required to report their calculation inputs by March 31, 2013. For factors that will take longer to evaluate, the deadline is March 31, 2015, the agency said in a final rule to be published in the Federal Register on August 25, 2011. The EPA had proposed deferring the input reporting requirements until March 31, 2014 (75 Fed. Reg. 81,350), but now says the additional year is necessary for many of the calculation inputs because “the number of data elements that would require a more in-depth evaluation is much larger than EPA had anticipated at the time of the deferral proposal.” The final rule will require electric transmission systems, stationary sources that burn fuels, underground coal mines, municipal solid waste landfills, industrial wastewater treatment, electric equipment manufacturers, and industrial waste landfills to begin reporting several emissions inputs by March 31, 2013. The various inputs include the total heat input of fuels combusted, methane emissions, the decay rate of materials stored in landfills and the type of coverings used, and volumes of wastewater treated using anaerobic processes.

The second deadline of March 31, 2015 applies to several data elements that must be reported by stationary sources that burn fuels, adipic acid production, aluminum production, ammonia manufacturing, cement production, electronics manufacturers, ferroalloy production, fluorinated gas production, glass production, HCFC-22 production and HFC-23 destruction, hydrogen production, iron and steel production, lead production, lime manufacturing, carbonate uses, nitric acid production, petroleum and natural gas systems, petrochemical production, petroleum refineries, phosphoric acid production, pulp and paper production, silicon carbide production, soda ash manufacturing, titanium dioxide production, zinc production, industrial wastewater treatment, and industrial waste landfills.
Other industries must report inputs by September 30, 2011, which is also the deadline for all industries subject to the mandatory reporting rule to reveal their 2010 emissions.
Industries originally had until March 31 to report their 2010 emissions and calculation factors. But in March, the EPA extended that deadline until September 30th to allow the agency time to review industry concerns that some of the inputs used to calculate their emissions would be considered confidential business information (76 Fed. Reg. 14,812; 53 DEN A-4, 3/18/11). The agency has since determined that GHG emissions and the calculations and test methods used to measure emissions are public information and will not be treated as confidential. They are continuing to examine the factors used in calculations to determine if confidentiality is warranted (102 DEN A-2, 5/26/11). EPA sent another proposed rule to the White House Office of Management and Budget for review on July 13th that would define confidential business information that cannot be disclosed for eight emissions sources, including electronics manufacturing, petroleum and natural gas systems, and carbon sequestration (136 DEN A-9, 7/15/11). (Source: EPA, August, 25, 2011). For more information, see www.epa.gov.

U.S. EPA Issues Greenhouse Gas Reporting Requirements for Four Additional Emissions Sources

The U.S. EPA has added underground coal mines and industrial wastewater plants to the list of facilities that must track their greenhouse gas emissions and report them. In addition, magnesium production plants and industrial waste landfills will be required to submit annual reports on emissions, although no regulations to control emissions have been implemented yet.

The final rule for Mandatory Reporting of Greenhouse Gases from Magnesium Production, Underground Coal Mines, Industrial Wastewater Treatment, and Industrial Waste Landfills (40 CFR Part 98) was issued on June 28, 2010. This action amends the Greenhouse Gas Reporting Program (GHG Reporting Program) requirements. In addition, this action states the EPA’s final decision not to include ethanol production and food processing as distinct subparts in the GHG Reporting Program, as well as the final decision not to include suppliers of coal at this time. With this final rule, the EPA has taken action on all outstanding source categories and subparts from the April 2009 proposal for the GHG Reporting Program.

These new source categories will begin collecting emissions data on January 1, 2011, with the first annual reports to be submitted to the EPA by March 31, 2012.

U.S. EPA Issues Final Rule for GHG Emissions from Large Emitters

On May 13, 2010, the U.S. Environmental Protection Agency (EPA) issued a final rule for addressing greenhouse gas (GHG) emissions from stationary sources under permitting programs of the Clean Air Act (CAA). This rule follows the EPA finding in late 2009 that GHG emissions endanger human health, which allows the EPA to regulate GHGs under the CAA. The final rule sets thresholds for GHG emissions that define when permits under the New Source Review Prevention of Significant Deterioration (PSD) and title V Operating Permit programs are required for new and existing industrial facilities. In particular, regulated facilities would be required to obtain permits showing they are using the best available technology to cut emissions when building new plants or modifying existing ones. The final rule is also referred to as the “tailoring rule” because it tailors the requirements of CAA permitting programs to limit which facilities will be required to obtain PSD and title V Operating Permits.

Starting in January 2011, facilities responsible for almost 70% of U.S. GHG emissions from stationary sources will be subject to permitting requirements. These facilities will include power plants, refineries, factories and cement production facilities that emit 75,000 metric tonnes or more of carbon dioxide equivalent, but will exclude small emitters such as farms, restaurants, hospitals and schools. Without the tailoring, small emitters would also be caught by the rule.

Waste landfills and factories that are not already covered by the CAA that emit at least 100,000 metric tonnes of GHGs per year would get a 6 month extension and would not be regulated until July 2011. Sources that pollute less than 50,000 metric tonnes per year would not be regulated until 2016, if ever, according to the EPA.

The final rule is aimed at giving momentum to the climate bill that was introduced by Senators John Kerry and Joseph Lieberman on May 12, 2010. A number of industry lawsuits have been launched which call into question the EPA’s authority to regulate GHG emissions, however it is President Obama’s hope that the final rule will push lawmakers in states heavily dependent on fossil fuels to support the Kerry-Lieberman bill. As currently drafted, the Kerry-Lieberman bill pre-empts automatic EPA regulations; in the event the Kerry-Lieberman bill is not passed by the Senate, the final rule sets up future regulations for large emitters.

For more information, please refer to the Fact Sheet (Final Rule: Prevention of Significant Deterioration and Title V Greenhouse Gas Tailoring Rule) issued by the EPA: link

U.S. EPA Proposes to Add More Sources to Mandatory GHG Reporting Program

In order to gain a better understanding of greenhouse gas (GHG) emission sources, the U.S. Environmental Protection Agency (EPA) is proposing to include additional emissions sources in its national mandatory greenhouse gas (GHG) reporting system.

In October 2009, the EPA finalized the Mandatory Reporting of Greenhouse Gases Rule, which requires 31 industry sectors (representing 85 percent of total U.S. GHG emissions) to track and report their emissions. This reporting rule requires suppliers of fossil fuels or industrial greenhouse gases, manufacturers of vehicles and engines, and facilities that emit 25,000 metric tons or more of GHG emissions per year to submit annual reports to the EPA.

On March 22, 2010, the EPA issued proposed rules targeted at expanding the scope of the reporting system to cover facilities emitting 25,000 metric tons or more of GHG emissions per year in the following sectors:

oil and natural gas industry (this will include vented and fugitive methane and CO2 emissions);
industries that emit fluorinated gases (source categories will include: electronics manufacturing, fluorinated gas production, manufacture and use of electric transmission and distribution equipment, and imports/exports of equipment pre-charged with fluorinated GHGs or containing fluorinated GHGs in closed-cell foams); and
facilities that inject and store CO2 underground for the purposes of geologic sequestration or enhanced oil and gas recovery.

Newly covered sources would be required to begin collecting emissions data on January 1, 2011, with the first annual reports submitted to the EPA on March 31, 2012. In addition, the EPA is proposing to require all facilities in the reporting system, including those proposed, to provide information on their corporate ownership.

These proposals will be open for public comment for 60 days after publication in the Federal Register. The EPA will also hold public hearings on these proposals in April 2010.

For more information on these proposals and the hearings, please go to
Link

U.S. EPA Issues Final Rule on GHG Reporting

On September 22, 2009, the U.S. Environmental Protection Agency (EPA) issued a final rule requiring the reporting of GHG emissions from large emission sources in the U.S. (the EPA Reporting Rule). In particular, the EPA Reporting Rule requires stationary source GHG emitters, suppliers of fossil fuels or industrial gases, manufacturers of vehicles and engines, and facilities that emit 25,000 metric tons or more per year of GHGs to submit annual reports to the EPA. Regulated facilities must begin monitoring on January 1, 2010 and first reports will be due on March 31, 2011.

Under the EPA Reporting Rule, a broad range of facilities will be required to report on the following GHGs: carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFC), perfluorocarbons (PFC), sulfur hexafluoride (SF6), and other fluorinated gases including nitrogen trifluoride (NF3) and hydrofluorinated ethers (HFE). The EPA Reporting Rule captures 85% of U.S. GHG emissions and applies to approximately 10,000 facilities. There is a general reporting threshold of 25,000 metric tons of carbon dioxide equivalent (CO2e) per year from facilities with stationary input capacity of 30mm BTU/hr or greater. There are also 15 categories of emission sources – including cement, petrochemical and aluminum production – that are required to report whether or not the 25,000 ton threshold is met or exceeded. In addition, there are 9 categories – including iron, steel, glass, and pulp & paper production – that are also subject to a 25,000 ton threshold, but not limited to fuel combustion sources.

The following industries will be subject to the EPA Reporting Rule:

– Electricity generators

– Suppliers of coal-based liquid fuels, petroleum products, natural gas, natural gas liquids, industrial GHGs

– Petroleum refiners

– Petrochemical producers

– Pulp & paper manufacturers

– Producers and manufacturers of adipic acid, aluminum, ammonia, cement, ferroalloy, glass, iron, steel, lead, lime, nitric acid, phosphoric acid, soda ash, titanium dioxide, and zinc

– Municipal solid waste landfills

– Large-scale farming operations

It should be noted that the following sources are not covered by the EPA Reporting Rule:

– Coal suppliers

– Underground coal mines

– Oil and natural gas systems (i.e. offshore oil and natural gas production facilities, onshore natural gas processing and transmission compression facilities, underground natural gas storage facilities, liquefied natural gas storage and import/export facilities)

– Wastewater treatment facilities

– Producers and manufacturers of ethanol, electronics, fluorinated GHGs and magnesium

– Industrial landfills

– Food processors

In general, GHG reporting is to occur at the “facility” level, except that certain fossil fuel suppliers and manufacturers that use GHGs for industrial purposes, along with vehicle and engine manufacturers, will report at the “corporate” level.

Fossil fuel suppliers must report GHG emissions that would result from complete combustion or oxidation of products they supply. In some cases, this may result in double reporting of emissions (i.e. by a fuel supplier and user). As a result, the EPA will require some entities to report their actual emissions as well as those associated with their products (for example, petroleum refineries). The EPA Reporting Rule also requires that manufacturers of heavy-duty trucks, motorcycles and off-road engines report CO2 emission rates for the 2011 model year and emission rates for other GHGs in subsequent model years. The EPA Reporting Rule does not cover cars and light-duty trucks, but it is anticipated that the EPA will propose a comprehensive light-duty GHG emission control program commencing in 2012, which is likely to contain GHG monitoring and reporting requirements.

A facility may cease reporting if one of the following has occurred: (i) five consecutive years of emissions below 25,000 tons CO2e per year; (ii) three consecutive years of emissions below 15,000 tons CO2e per year; or (iii) its GHG-emitting processes or operations are shut down.

In recognition of the short timeframe for regulated facilities to start complying with data collection and monitoring requirements, the EPA has agreed to allow facilities to use “best available monitoring methods” to track GHG emissions data through March 31, 2010 in lieu of the monitoring methods specified in the EPA Reporting Rule. The monitoring methods required by EPA Reporting Rule vary depending on the type of facility. Certain facilities will be able to calculate their emissions based on fuel source type and other data, while others will be required to install continuous emissions monitoring equipment.

The EPA Reporting Rule does not require third party verification, as the EPA will verify the data submitted by regulated facilities. Regulated facilities will be required to self-certify that the data submitted to the EPA is accurate and emission records will need to be kept for a period of three years.

In August 2009 the EPA Assistant Administrator for Enforcement and Compliance Assurance, Cynthia Giles, underscored the need for an accounting system with real integrity, particularly in the context of a cap-and-trade program. It is clear that enforcement will have a key role in the regulation of GHGs. Failure to report would face enforcement under the U.S. Clean Air Act, which can lead to civil penalties of up to $37,500 per day for each violation. The EPA Reporting Rule represents the first time that industrial emission sources will be required to monitor and report GHG emissions data to the EPA. As such, it is advisable for companies with U.S.-based operations that fall within the categories set out above to review their operations and determine whether they will be caught by the EPA’s new reporting requirements. Finally, it is important to note that the EPA has the power to expand the scope of the EPA Reporting Rule to include additional source categories in the future. As a result, it will be prudent for industrial emitters to monitor regulatory developments on a continuing basis to ensure that they are in compliance with all reporting and other regulatory requirements.

For more information on the EPA Reporting Regulation or if you require assistance with your GHG reporting, please “Contact Us”.