API sees problems with EPA's ozone, GHG proposals

Nick Snow
OGJ Washington Editor

WASHINGTON, DC, Oct. 28 -- American Petroleum Institute officials expressed concern that the US Environmental Protection Agency could implement poorly conceived and inadequately researched regulations in the next few months. They cited EPA’s proposal to reduce allowable ozone levels under the National Ambient Air Quality Standards, its plan to begin regulating greenhouse gases under the Clean Air Act, and its decision to raise allowable ethanol limits in gasoline to 15% for 2007 or newer cars and light-duty trucks.

“We think EPA is responding to politics, particularly with E15,” said Howard Feldman, API’s regulatory and scientific affairs director. “On greenhouse gases, it may feel compelled to do something but it is trying to push a requirement through without adequate research. The states aren’t ready. With ozone, it could have stayed with the most stringent standard ever promulgated, but has chosen not to.”

He noted that API and the National Association of Manufacturers funded a study by the Manufacturers Alliance which found that EPA’s proposal to reduce ozone non-attainment levels from to 60-70 ppb from 75 ppb would cost 7.3 million jobs by 2020 and about $1 trillion/year during 2020-30. “EPA typically reviews national ambient air quality standards every 5 years, yet it is gearing up to change the current regulations after only 2 years,” he noted.

Khary Cauthen, API’s federal relations director, said EPA is working from its own schedule, and not necessarily in response to a 2007 US Supreme Court decision, in proposing to begin regulating GHG emissions from stationary sources under the Clean Air Act early in 2011. “We need climate regulation which is efficient and less costly,” he maintained. “We believe the most efficient way to reduce emissions is incrementally through new technology instead of command-and-control measures by various government bureaucrats.”

He said API considers Congress best qualified to address global climate change. The trade association supports US Sen. John D. Rockefeller IV’s (D-W.Va.) bill which would make EPA wait for 2 years before moving ahead on GHG regulation, he indicated.

Prentiss Searles, API’s downstream and industry operations manager, said that the association is considering its options, including a possible legal action, in the wake of EPA’s Oct. 13 decision to issue a partial E15 waiver. He said API was disappointed that EPA did not wait until petroleum and automotive-industry sponsored studies by the Coordinating Research Council conclusively demonstrate whether higher ethanol levels can be safely used.

“Introduction of this new standard without proper research is good politics, but bad policy,” he indicated. “EPA also seems to believe that a label on the pump will keep consumers from misfueling. We’re not so certain that will be the case.”

“The air has gotten a lot better because of regulations put in place and industry’s efforts,” said Feldman. “But we’re reaching a point of diminishing returns. The cost curves on these proposals and decisions are exponential, and we see manufacturing and jobs moving overseas.”

Contact Nick Snow at nicks@pennwell.com.

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