This Week in Review – February 11-15, 2013

(1) President Calls for Action on Climate Change in State of the Union Address (February 12, 2013) – President Barack Obama, in his State of the Union address, called on Congress to “pursue a bipartisan, market-based solution to climate change” but noted that if Congress fails to act, “I will.” To that end, he said he would direct his Cabinet to “come up with executive actions we can take, now and in the future, to reduce pollution, prepare our communities for the consequences of climate change, and speed the transition to more sustainable sources of energy.” In his remarks, the President noted that we are already experiencing the effects of climate change, pointing to the fact that 12 of the hottest years on record have come in the last 15 years, and heat waves, droughts, wildfires and floods are now more frequent and more intense. He said that “for the sake of our children and our future, we must do more to combat climate change.” He also noted that the natural gas boom has led to “cleaner power” but that he wants to work with Congress “to encourage the research and technology that helps natural gas burn even cleaner and protects our air and our water.” The President also announced a goal of doubling energy efficiency in homes and businesses and involving states in reaching this goal. Specifically, he said that “[t]hose states with the best ideas to create jobs and lower energy bills by constructing more efficient buildings will receive federal support to help make that happen.” For further information: http://www.whitehouse.gov/the-press-office/2013/02/12/remarks-president-state-union-address

(2) Federal Agencies Describe Ramifications of Possible Sequestration of Funds (February 14, 2013) – The Senate Appropriations Committee released letters from federal agencies, including EPA, explaining the impacts of the possible sequestration budget cuts on their programs and activities. The sequestration could take effect as soon as March 1, 2013. EPA Deputy Administrator Robert Perciasepe, signing on behalf of Administrator Lisa Jackson, states that the sequestration “will force us to make cuts we believe will directly undercut our congressionally-mandated mission of ensuring Americans have clean air, clean water and clean land.” The three air programs EPA highlights in this regard are the Energy Star program, vehicle certifications for emission standards and state monitoring programs. Specifically with respect to the latter, EPA predicts it would have to reduce funds the agency provides to states to monitor air quality, resulting in the shutdown of some sites, including ozone and particulate matter monitors.

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Additionally, reduced funds due to sequestration could adversely affect essential air quality data systems. EPA also identifies enforcement and compliance activities and research as areas that would be threatened by the sequestration. According to earlier estimates, the sequestration would reduce federal funding across the board, resulting in a reduction of 8.2 percent to EPA’s funding. For further information: http://www.appropriations.senate.gov/ht-full.cfm?method=hearings.view&id=17d3dc99-c065-4bec-a7c8-cfd374bf41a3 (3) Jackson Stresses EJ Work in Parting Words (February 14, 2013) – EPA Administrator Lisa Jackson, on her last day in the office, wrote on her blog about EPA’s progress in addressing environmental justice (EJ) concerns. She said that when she started at EPA, EJ was “at the top of the list” of her priorities for the agency. She pointed to Plan EJ 2014 as a foundational tool for ensuring that EJ is integrated into all of EPA’s day-to-day responsibilities. (See related article in this Washington Update about the release of the Plan EJ 2014 Progress Report.) Jackson closed her blog as follows: “For the first time in our 42 year history, we have laid the groundwork for EPA to fully implement its environmental justice mission of ensuring environmental protection for all Americans, regardless of race, ethnicity or income level. I am proud of the work we have started and the progress we have made, and I am confident that it will continue long after I depart.” For further information: http://blog.epa.gov/ej/2013/02/reducing-pollution-for-all-american-families/ (4) EPA Issues SSM Petition Response, Includes SIP Calls for 36 of 39 States Named in Petition (February 13, 2013) – EPA issued a proposal in response to a petition from the Sierra Club regarding alleged inadequacies in 39 state SIPs regarding exemptions for emissions during startup, shutdown and malfunctions (SSM). EPA proposes to grant the petitioner’s claim for 36 of the 39 states identified in the petition by proposing to determine that these 36 states have approved SIPs that include one or more SSM provisions that are inconsistent with the Clean Air Act. EPA proposes a SIP Call for each of those 36 states. In addition, EPA proposes findings of inadequacy for these 36 states – findings that the SSM provisions in the SIPs do not meet the requirements of the Clean Air Act – and proposes to give the 36 affected states 18 months to correct and submit their state plans to EPA. The 18-month clock would start when EPA makes its final findings of inadequacy. EPA also proposes to deny a request in the petition that it prohibit affirmative defenses in SIPs. Rather, EPA is revising its previous policy to continue to allow affirmative defenses in SIPs (for states that choose to provide them) for excess emissions that occur when a facility is experiencing a malfunction (an unplanned event) but not for excess emissions that occur when a facility is operating in a planned startup or shutdown mode. Finally, EPA proposes to deny the request in the petition that EPA discontinue reliance on interpretive letters from states to clarify any potential ambiguity in the state's SIP submission. EPA will accept comment on this proposal for 30 days after publication in the Federal Register. If a public hearing is requested, EPA will hold one in Washington, DC, on March 12, 2013, and will extend the comment period to 30 days beyond the hearing date. For further information:

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http://members.4cleanair.org/rc_files/5490/SSM_Petition_2060-AR68_Proposal_FRN_2-12-13.pdf and http://members.4cleanair.org/rc_files/5489/SSM_SIP_Fact_Sheet_final.pdf (5) EPA Announces 120-Day Letters for SO2 Area Designations, Seeks Comments (February 15, 2013) – EPA published in the Federal Register (78 FR 11124) a notice announcing that it has posted its responses to state and tribal recommendations for the first round of area designations under the 2010 1-hour primary National Ambient Air Quality Standard for sulfur dioxide (SO2). This round of designations focuses on areas where air monitoring data from 2009 through 2011 indicate violations of the SO2 standard. The agency sent its responses – the “120-day letters” – to each affected state and tribe last week, on February 7, 2013, and will accept comments until March 18, 2013. EPA intends to make final designation determinations for these areas in June 2013. For further information: http://www.gpo.gov/fdsys/pkg/FR-2013-02-15/pdf/2013-03593.pdf and http://www.epa.gov/so2designations/regs.html (6) EPA Releases Progress Report on Implementing Plan EJ 2014 (February 11, 2013) – EPA released a progress report on implementing Plan EJ 2014, which is the agency’s roadmap for integrating environmental justice (EJ) into its programs, policies and activities. Some of the key accomplishments cited in the report include publishing “Plan EJ 2014: EJ Legal Tools”; creating an internal screening tool, “EJSCREEN,” which provides nationally consistent data and methods for screening areas of potential EJ concern that may warrant further consideration, analysis or outreach; developing and implementing EJ into rulemaking guidance; creating the foundation for considering EJ in permitting; advancing EJ through compliance and enforcement; identifying promising community-based practices; and reviewing EPA’s application of Title VI. For further information: http://www.epa.gov/environmentaljustice/resources/policy/plan-ej-2014/plan-ej-progress-report-2013.pdf (7) GAO Says Federal Government Not Adequately Prepared to Deal with Significant Financial Risks Posed by Climate Change (February 14, 2013) – The Government Accountability Office (GAO) released reports identifying climate change as a significant financial risk for which the federal government is not adequately prepared. The federal government faces risks from climate change in its role as property owner, manager of federal insurance programs, provider of disaster aid and provider of technical assistance to state and local governments. For example, the federal government owns and operates hundreds of thousands of buildings and facilities, such as defense installations, that could be affected by a changing climate, including sea level rise. Furthermore, the nation’s flood and crop insurance programs are based on conditions, priorities and approaches that do not account for climate change and thus may not be adequately funded to cover their risks. Moreover, disaster declarations have increased over recent decades to a record of 98 in fiscal year 2011 compared with 65 in 2004, and these are unplanned and unbudgeted expenses for the federal government. With respect to state and local infrastructure projects that receive federal funding,

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“insufficient site-specific data – such as local temperature and precipitation projections – make it hard for state and local officials to justify the current costs of adaptation efforts for potentially less certain future benefits.” GAO recommends a government-wide strategic approach to manage climate change risks and provides specific recommendations to help address the deficiencies in the areas noted above. In related news, Rep. Elijah Cummings (D-MD), Ranking Member of the House Oversight and Government Reform Committee, wrote Darrell Issa (R-CA), Committee Chairman, requesting a series of hearings on the GAO reports. For further information: http://www.gao.gov/assets/660/652166.pdf, http://www.gao.gov/assets/660/652133.pdf and http://democrats.oversight.house.gov/images/stories/2013-02-13.EEC%20to%20Issa.GAO%20High%20Risk.climate%20change.pdf (8) ICAO Committee Agrees on Certification Procedures to Support New Aircraft CO2 Standard (February 14, 2013) – The Committee on Aviation Environmental Protection (CAEP) of the International Civil Aviation Organization (ICAO) reached agreement on new carbon dioxide (CO2) certification procedures that would support a new aircraft CO2 standard. According to ICAO, the procedures, which mark another step toward “a practical and comprehensive CO2 standard for aircraft,” follow a related decision by the CAEP in July 2012 on a metric system that can be used to characterize CO2 emissions from various types of aircraft. ICAO Council President Roberto Kobeh González stated, “We are now looking to the CAEP’s wide cross-section of air transport experts to get to work on the last agreements needed to realize the aircraft CO2 standard, namely its stringency and scope of applicability.” For further information: http://www.icao.int/Newsroom/Pages/ICAO-environmental-protection-committee-delivers-progress-on-new-aircraft-CO2-and-noise-standards.aspx (9) Sierra Club Challenges EPA’s Denial of Petitions for Reconsideration and Stay Requests for Ozone Area Designations (February 12, 2013) – The Sierra Club filed a petition in the U.S. Court of Appeals for the District of Columbia Circuit (No. 13-1030) seeking review of EPA’s January 7, 2013 decision denying petitions for reconsideration and stay requests regarding the agency’s area designations under the 2008 1-hour ozone standard. Sierra Club had petitioned EPA for reconsideration contending that if the agency had based designations on more recent air quality data, 15 additional areas would have been designated as nonattainment under the 2008 ozone standard. For further information: http://www.4cleanair.org/Documents/LitigationO3DesignationsSierraClub021213.pdf and http://www.gpo.gov/fdsys/pkg/FR-2013-01-07/pdf/2013-00053.pdf (10) International Joint Commission Seeks Comment on 2012 Progress Report on Canada-U.S. Air Quality Agreement (February 12, 2013) – The bilateral Air Quality Committee under the 1991 Canada-U.S. Air Quality Agreement released for review and comment its 2012 Progress Report, the eleventh such report under the Agreement. In the report, the Committee highlights the key actions taken over the past two years by Canada and the U.S. to address transboundary air pollution, presents progress made toward meeting the

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commitments made in the Acid Rain and Ozone Annexes of the Agreement and overviews scientific and technical trends related to air pollution. As of 2010, the Committee reports, Canada has reduced total sulfur dioxide (SO2) emissions by 57 percent from 1990 levels, while the U.S. has reduced total SO2 emissions by 67 percent from 1990 levels. In addition, between 2000 and 2010, Canada decreased total nitrogen oxide (NOx) emissions in the transboundary ozone region by 40 percent; during the same time period, the U.S. decreased total NOx emissions in the region by 42 percent. The International Joint Committee (IJC) is seeking comments, by September 27, 2013, on the 2012 Progress Report, as well as on any aspect of the work being conducted under the Canada-U.S. Air Quality Agreement. IJC will provide all comments received to the Canadian and U.S. governments for their consideration as they implement the Agreement. IJC will also compile the comments into a synthesis report that will be made available to the public. For further information: http://www.ijc.org/en_/air_quality_2012/Progess_Report (11) Senators Boxer and Sanders Introduce Climate Change Bills (February 14, 2013) – Senator Barbara Boxer (D-CA), Chairman of the Senate Environment and Public Works Committee, and Senator Bernie Sanders (I-VT) introduced legislation to address climate change by enacting a fee on carbon emissions. The Climate Protection Act of 2013 would enact a carbon fee of $20 per ton of carbon or methane equivalent, rising 5.6 percent a year over a 10-year period. It would be applied to upstream emissions – at the coal mine, oil refinery, natural gas processing point or point of importation – covering approximately 85 percent of U.S. greenhouse gas (GHG) emissions. A portion of the revenues generated by the fee would be directed to energy efficiency and renewable energy programs, including weatherizing 1 million homes per year, tripling the budget for ARPA-E energy research and development, creating a sustainable technologies finance program, investing in domestic manufacturing and energy-intensive industry to improve energy efficiency and funding $1 billion per year in worker training for a clean energy economy. Sixty percent of the revenue would be used to provide a monthly rebate to every legal U.S. resident. Furthermore, approximately $300 billion would go towards debt reduction over the 10 years. The fee would go into effect no later than 2014. In addition, the bill would impose a fee on the importation of “carbon pollution-intensive goods” and the fees would be used to help state and local communities adapt to climate change. Senator Sanders also introduced legislation, the Sustainable Energy Act, to eliminate certain fossil fuel subsidies and extend certain energy tax incentives. For further information: http://www.sanders.senate.gov/imo/media/doc/0121413-ClimateProtectionAct.pdf, http://www.sanders.senate.gov/imo/media/doc/021413-SustainableEnergyAct.pdf and http://www.sanders.senate.gov/newsroom/news/?id=2a869a44-1597-42a8-b625-1a88db3febbc (12) Texas Representative Introduces Legislation to Bar EPA Regulation of GHG Emissions from Stationary Sources (February 12, 2013) – Rep. Ted Poe (R-TX) introduced legislation that would prohibit EPA from using funds to implement or enforce regulations related to greenhouse gas (GHG) emissions

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from stationary sources. Specifically, H.R. 621 would prohibit EPA from using funds to implement or enforce any statutory or regulatory requirement pertaining to GHG emissions that is issued or becomes applicable or effective after the date of enactment, including any regulations issued under section 111 of the Clean Air Act or any permitting requirements. The bill would also ban EPA from using funds to implement or enforce a GHG cap-and-trade program. For further information: http://hdl.loc.gov/loc.uscongress/legislation.113hr621 (13) EPA Publishes Portland Cement Air Toxics Rule (February 12, 2013) – EPA published in the Federal Register (78 FR 10006) final amendments to the Portland Cement National Emission Standards for Hazardous Air Pollutants and New Source Performance Standard, which were announced on December 20, 2012. Among other things, the amendments extend the compliance deadline for existing kilns from September 9, 2013 until September 9, 2015; facilities may request an additional year, if needed. EPA had issued the earlier Portland Cement rules in September 2010. The court remanded the rules to EPA in December 2011 and instructed the agency to review them in light of possible overlap with the Commercial/Industrial Solid Waste Incinerator rule. Additionally, EPA had received requests for reconsideration regarding the standards. This latest final rule is the result of the court remand, the reconsideration and additional data EPA received after the earlier rule was issued. For further information: http://www.gpo.gov/fdsys/pkg/FR-2013-02-12/pdf/2012-31633.pdf (14) Energy Efficiency and Pollution Control Calculator Released (February 14, 2013) – The American Council for an Energy-Efficient Economy (ACEEE) released a calculator that provides estimates of the costs and air quality benefits of some basic energy efficiency policies and allows for the comparison of those options to more traditional approaches to reducing air pollution, such as installing air pollution control equipment or fuel switching. According to ACEEE, the calculator can be used by state regulators and policymakers to obtain a first-order estimate of what the costs and emissions benefits from energy efficiency could be in a state and to illustrate the magnitude of efficiency’s potential. For further information: http://aceee.org/123-solutions

(15) Groups Propose State Clean Energy Finance Initiative (February 11, 2013) – The Clean Energy Group and the Council of Development Finance Agencies proposed the creation a federal clean energy financing initiative where program development and project financing approvals would be conducted by state governments. The proposal, State Clean Energy Financing Initiative, would have the federal government place a greater emphasis on bond financing for clean energy projects and businesses. Under the proposal, the public role of providing financial support for the adoption of clean energy technologies would continue, but through credit enhancement tools designed to leverage private capital. It would be modeled on the State Small Business Credit Initiative, in which states retain autonomy to better address the small business capital access needs in each state. Similarly, the proposed initiative would allow clean energy investments to be tailored to state infrastructure, needs and suitability. For further information:

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http://www.cleanegroup.org/assets/Uploads/State-Clean-Energy-Finance-Initiative-2-6-13.pdf (16) Over 700 Institutional Investors Request Disclosure of Companies’ Carbon Emissions and Climate Strategies (February 11, 2013) – According to the Carbon Disclosure Project (CDP), 722 institutional investors have asked over 5,000 public companies to disclose their carbon emissions and climate change strategies through the CDP. The investors represent about one-third of the world’s invested capital. CDP began requesting this kind of information about 10 years ago. For further information: https://www.cdproject.net/en-US/News/CDP%20News%20Article%20Pages/a-third-of-worlds-invested-capital-calls-for-corporate-environmental-data.aspx (17) USDA Solicits Nominations for Agricultural Air Quality Task Force (February 13, 2013) – The U.S. Department of Agriculture (USDA) is soliciting nominations of qualified candidates for a two-year term on the department’s Agricultural Air Quality Task Force. The task force advises the Secretary of Agriculture on the role of the Secretary in providing oversight and coordination related to agricultural air quality. Nominations are due by April 1, 2013. For further information: http://www.gpo.gov/fdsys/pkg/FR-2013-02-13/pdf/2013-03247.pdf

The Week Ahead Presidents’ Day Holiday – February 17, 2013

Congress in Recess – February 18-22, 2013

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