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Policy News Update

April 27 , 2010

In this issue: [Contract All : Expand All]

HOUSE: NOAA CLARIFIES SPILL ESTIMATES DURING COMMITTEE HEARING

Roughly three-quarters of the oil that spilled into the Gulf of Mexico from BP's ruptured well is still in the environment, a National Oceanic and Atmospheric Administration (NOAA) official reported during an August recess convening of the House Energy and Commerce Subcommittee on Energy and Environment on Thursday, Aug. 19.

Bill Lehr, a senior scientist at NOAA, said that federal officials have only confirmed that 10 percent of the 4.1 million barrels of oil that leaked into the Gulf have been either skimmed or burned.

These numbers contradict those of an Aug. 4 interagency report where federal officials used a different estimate of how much oil leaked from the well — 4.9 million barrels — to conclude that only about 25 percent is still left to be recovered in the water. Scientists had argued the report does not place enough emphasis on the effects of the dispersed oil.

Energy and Environment Subcommittee Chairman Edward Markey (D-MA) stated the administration’s earlier report this month gave people a “false sense of confidence” about the environmental risks that remain. Markey said the amount of unaccounted-for oil is five times the total amount spilled in the 1989 Exxon Valdez disaster, which, until the Gulf spill, was the largest in U.S. history. “The previous government report used an estimate of 206 million spilled gallons as the basis for the calculations, but using the smaller figure of 172 million gallons is more accurate, Lehr said, because it takes into account the 33.6 million gallons that BP immediately captured.

Lehr did not have an estimate on the percentage of oil recovered to date from the shoreline and said it would take another two months for administration officials to release their full report on the BP spill. Markey asked Lehr in the meantime to release data used to put together the initial oil budget calculation the administration released this month so it could be subjected to independent scientific review.

GULF RESEARCH: MURKY RELATIONSHIPS MARK SCIENTIFIC EFFORTS TO ASSESS IMPACTS

Lawmakers have criticized BP for attempting to “muzzle” scientists researching the Gulf of Mexico oil spill with confidentiality agreements and blocking the “open exchange of scientific data and analysis.” Simultaneously, there are concerns with government statutes and procedures that have the same consequences.

BP was blasted for retaining scientific expert witnesses for the Natural Resource Damage Assessment and Restoration Program (NRDA) process who are prohibited from releasing research findings for three years or until after a restoration plan had been approved. House Energy and Commerce Committee Chairman Henry Waxman (D-CA) and Energy and Environment Subcommittee Chairman Edward Markey (D-MA) sent a letter last month to BP America asking the company to explain itself and provide copies of all scientist and third-party contracts.

Concurrently, the government is hiring expert witnesses under confidentiality agreements as it builds a legal case documenting the oil spill's environmental impact and determining how much BP and its partners should pay to restore the Gulf to pre-spill conditions, officials said.

NRDA, enacted under the Oil Pollution Act of 1990, is the legal process for quantifying ecological harm caused by oil spills and developing a restoration plan that must be paid for by the responsible parties. The assessment is conducted by federal and state agencies with oversight of natural resources, including the Interior and Commerce departments -- collectively referred to as “trustees.”

While federal and state agencies are publicly sharing oil exposure data collected by BP-government scientist teams, they reserve the right to withhold information from studies the government and BP have not agreed on, according to Tom Brosnan, an environmental scientist with the National Oceanic and Atmospheric Administration.

To try to minimize disagreements about data, the government and the responsible parties are encouraged to work together to collect data. However, findings from any studies the government and BP have not agreed to do together may not be released publicly until after the assessment is complete, Brosnan said.

Scientists are also concerned the government is not collecting enough robust data needed for the NRDA. Many university and research institutions have launched independent studies of the Gulf oil spill. For example, the National Aquarium is teaming up with Johns Hopkins University and Mote Marine Laboratory to study Sarasota Bay, FL before it is potentially polluted.

The National Science Foundation (NSF) has so far awarded over $7 million in rapid grants for researchers studying the oil spill. However, there is no widespread coordination throughout the research community to ensure resources are being used efficiently, methods are consistent, and no gaps exist in research coverage.

While research funded by NSF is accepted as independent, there is concern about the $500 million research fund that BP has established. Reps. Lois Capps (D-CA) and Lynn Woolsey (D-CA) sent a letter last month urging BP to turn over management of the fund to the National Academy of Sciences to ensure the research is impartial and rigorously reviewed. Their letter has not yet received a response.

GULF RESEARCH: SUPPORT FOR GREATER SCIENTIFIC INPUT INTO OFFSHORE DRILLING EXPANSION RECOMMENDED DURING OIL SPILL COMMISSION HEARING

The National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling met August 25, in Washington, DC to examine regulatory oversight issues in offshore drilling. During the hearing, both commissioners and panelists concurred that appropriate scientific insight was needed in the review process.

“There isn't a culture--and this crosses administrations--that naturally reaches out to the scientists for their participation, therefore it would be appropriate to ask that Congress change the process,” stated Commission Co-Chair Bob Graham, formerly a Florida U.S. Senator and Governor. “Scientists outside MMS [Minerals Management Service], based on what I've been told, do not really think they have been adequately consulted or effectively involved in these decisions,” stated Co-Chair Ben Reilly, former head of the Environmental Protection Agency.

Carter Roberts, President and CEO of the World Wildlife Fund testified during the first panel that a drilling policy in which leasing and drilling decisions are made only after “we have a map of what’s in the oceans” in order to make smart choices on where to drill based on the scientific data collected. Roberts advocated the creation of an independent director of environmental science who would serve as a chief consultant in enacting a national oceans policy.

During the second panel, Graham questioned key federal agency heads on whether they had been consulted prior to March 31, when President Obama approved additional oil drilling off parts of the mid and south Atlantic, Alaska and in the eastern Gulf of Mexico. National Oceanic and Atmospheric Administration (NOAA) Administrator Dr. Jane Lubchenco and Nancy Sutley, chair of the Council on Environmental Quality, said that while they did offer comments about the proposal, the major decisions were made by the president and Department of Interior Secretary Ken Salazar, who oversees U.S. oil and gas policy under federal law.

Dr. Lubchenco asserted that there should be an environmental assessment in every step of the leasing process and that an Environmental Impact Study should be conducted in at least the last two steps of the process. Commenting on NOAA’s process of releasing timely reports on the spill, Lubchenco asserted “we don’t believe in withholding information. We want to get information out as quickly as we feel is responsible.”

Another panelist, Meg Caldwell, Executive Director of the Center for Ocean Solutions at Stanford University, recommended that NOAA and similar federal entities be formally designated federal oil and gas cooperating agencies because their scientists are uniquely capable of advising the administration about environmental risks. Graham stated that the panel may call for legislation to mandate that the Department of Interior work with NOAA and the White House Council on Environmental Quality when formulating policy.

The National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling was established on May 21, 2010 by President Obama. The bipartisan commission is tasked with “providing recommendations on how the United States can prevent and mitigate the impact of any future spills that result from offshore drilling.” The commission’s final report is due out by January 2011.

OFFSHORE DRILLING: INTERIOR ENDS EXEMPTIONS FOR DEEPWATER WELLS

A new report from the Bureau of Ocean Energy Management Regulation and Enforcement (BOEMRE) outlines flaws in the government's process in approving the well that caused the Gulf of Mexico oil gusher. The Department of Interior, which has jurisdiction over BOEMRE, will curtail the use of a provision it had been employing to streamline offshore drilling applications, including the BP well. Full environmental assessments will now be required for all new deepwater drilling, the department announced on Aug. 16, 2010.

The new policy will require much more extensive environmental scrutiny once the moratorium is lifted and will lengthen the process of granting new drilling permits. Under current policy, the agency has only 30 days to decide whether to approve a drilling application. The new policy will also suspend the issuing of automatic exemptions from environmental review for virtually all new wells in the gulf. Such waivers have become common in recent years.

In May, the Obama administration announced it would re-evaluate environmental reviews for offshore drilling required under the National Environmental Policy Act (NEPA) in the wake of the massive Gulf of Mexico oil spill. The moratorium on most deepwater drilling in the Gulf will continue as the study proceeds, according to Interior. The policies will remain in effect while the department implements a comprehensive review of its NEPA process and the use of categorical exclusions.

The decision also will affect new drilling closer to shore. All shallow-water plans will require a categorical-exclusion review to examine whether any factors would trigger an environmental assessment -- such as the use of unusual technology or a location near biologically sensitive areas -- and whether the plan's worst-case spill volume is greater than accounted for in oil spill response plans.

Categorical exclusions are actions that do not individually or cumulatively have a significant effect on the human environment and for which neither an environmental assessment nor an environmental impact statement is required. The categorical exclusion process was originally established to reduce the amount of paperwork and delay associated with NEPA compliance.

Many oil industry officials worry that the new environmental, safety, technical and financial requirements will drive some companies out of business, discourage future exploration and worsen the nation’s dependence on imported oil. The Center for Biological Diversity, an environmental group that has drawn attention to the use of categorical exclusions for offshore oil wells, called the new Interior Department policy a step in the right direction.

House Natural Resources Chairman Nick Rahall (D-WV) welcomed the move but called on the Senate to approve the offshore drilling reform legislation he authored. The House-passed H.R. 3534, the CLEAR Act, prohibits the use of categorical exclusions for offshore drilling plans at all depths.

For more information on the CLEAR Act, see the Aug. 10 edition of the ESA Policy News at: www.esa.org/pao/policyNews/pn2010/08102010.php

The full BOEMRE report is available by clicking on the following link: www.doi.gov/news/pressreleases/loader.cfm?csModule=security/getfile&PageID=42011

FISHERIES: ENVIRO GROUPS, PHYSICIANS CLASH WITH FEDS OVER GULF SEAFOOD FINDINGS

The Natural Resources Defense Council and dozens of Gulf Coast environmental groups have called on the Obama administration to bolster its testing of seafood in the wake of the massive BP oil spill.

In letters to the National Oceanic and Atmospheric Administration (NOAA) and the Food and Drug Administration (FDA), the groups, which include the Gulf Restoration Network, local chapters of the Sierra Club, the Louisiana Environmental Action Network and the Deep South Center for Environmental Justice, request more data collection and strengthened protocols to determine whether fishing grounds should be reopened and whether seafood is safe to eat.

The letters come as the Gulf's fall shrimp season opens and federal officials begin reopening fishing grounds as spilled oil dissipates. About 22 percent of federal waters in the Gulf are closed to fishing -- down from a third at the height of the spill, which began April 20.

Before reopening fishing grounds, NOAA has relied on seafood tests and surveys and trajectory models of the oil spill to show areas that are at low risk for future exposure. Seafood assessments rely on testers using their sense of smell to sniff out defective food, a method that some have questioned but that federal officials say is very reliable.

Dangers still lurk in Gulf, medical association says

Some physicians have also questioned the potential long-term health effects from seafood from the tainted waters. Fishing and swimming in the Gulf of Mexico still pose a danger to human health and food safety, says a study in the Journal of the American Medical Association.

The study found that shrimp, oysters, crabs and other invertebrates are likely to contain polycyclic aromatic hydrocarbons (PAHs) in their systems. PAHs are also found in cigarette smoke and soot, according to Gina Solomon, co-author of the study and public health expert in the department of medicine at the University of California, San Francisco. Physicians are also concerned about trace amounts of cadmium, mercury and lead that occur in crude oil and can accumulate in fish tissues -- potentially increasing future health hazards in large fish.

The study also states that over time, mercury from oil could accumulate in long-living, big-fin fish such as tuna, swordfish and mackerel and become part of the food chain. Solomon’s study uses data from past oil spills such as the Exxon Valdez, together with data from the current spill collected from NOAA, EPA and the Food and Drug Administration.

Federal officials have repeatedly said Gulf seafood is safe and has shown no signs of oil or dispersants. President Obama has even come forward as the seafood-taster-in-chief, serving Gulf shrimp at his recent White House birthday party and eating seafood on his family's trip to Florida's Gulf Coast.

FDA said there is no problem with PAHs contaminating seafood, and that it has rigorous tests to watch for contamination in all shellfish. The agency will continue monitoring shellfish as well as large-fin fish in the future to ensure that toxins do not build up over time.

Click here to read the letter to NOAA.
Click here to read the letter to FDA.

ETHANOL: EPA E-15 WAIVER PROPOSAL PROVOKES DEBATE

A broad coalition of groups representing the automobile industry, the food industry and environmentalists as well as high-ranking lawmakers have expressed concerns with an Environmental Protection Agency (EPA) proposal that would increase ethanol in gasoline from 10 to 15 percent. There are concerns that the “mid-level” ethanol blend will harm some engines or that consumers will damage their vehicles by refueling with the wrong blend.

In July, House Energy and Commerce Chairman Henry Waxman (D-CA) and Ranking Member Joe Barton (R-TX) spearheaded a bipartisan letter requesting EPA take a hard look at whether higher blends of ethanol could harm some engines. The letter asks EPA for a detailed accounting of the effects of higher ethanol blends on older cars, non-road engines and emissions. The lawmakers say E15 should not be approved until there are “sufficient test results to allow you to assure consumers that use of E15 will not harm their vehicles or engines.”

Thirty-nine industry and environmental groups have also sent a letter to the Senate Environment and Public Works Committee requesting a hearing in September to examine U.S. EPA's handling of the proposal. “We believe there are many questions remaining before EPA makes its final decision on the mid-level ethanol fuel waiver, and that the Environment and Public Works Committee is the ideal place to ask those questions,” the letter says. “We also believe that the Department of Energy should fully expand and accelerate mid-level ethanol blends research in the areas that are necessary to protect consumers.”

Biofuels groups, led by Growth Energy, are pushing for EPA to approve a waiver for the E15 blend before the ethanol industry produces more ethanol than can be used. EPA is expected to make the change, although it could exclude older cars that may not be able to accommodate the fuel. Farm-state lawmakers and Agriculture Secretary Tom Vilsack support the waiver.

The groups seeking the Senate hearing include the Natural Resources Defense Council, the Alliance of Automobile Manufacturers, the Small Business and Entrepreneurship Council and the National Petrochemical and Refiners Association.

EPA has previously said that cars from 2001 or newer can accommodate the 15 percent blends but said there are questions about whether older engines can handle the mix, which the government is still studying. Agency officials have said they may approve E15 as one of several options available in gas stations and may approve the fuel only for newer engines. EPA is expected to decide the matter this fall after the Energy Department completes vehicle testing.

AIR POLLUTION: EPA PROPOSES RULES ON CLEAN AIR ACT PERMITTING FOR GREENHOUSE GAS EMISSIONS

The U.S. Environmental Protection Agency (EPA) is proposing two rules to ensure that businesses planning to build new, large facilities or make major expansions to existing ones will be able to obtain Clean Air Act permits that address their greenhouse gas (GHG) emissions.

In the spring of 2010, EPA finalized the GHG Tailoring Rule, which specifies that beginning in 2011, projects that increase GHG emissions substantially will require an air permit. EPA’s proposed rules are intended to ensure that these sources will be able to get those permits regardless of their location.

In the first rule, EPA is proposing to require permitting programs in 13 states to make changes to their implementation plans to ensure that GHG emissions will be covered. All other states that implement an EPA-approved air permitting program must review their existing permitting authority and inform EPA if their programs do not address GHG emissions.

Because some states may not be able to develop and submit revisions to their plans before the Tailoring Rule becomes effective in 2011, in the second rule, EPA is proposing a federal implementation plan, which would allow the agency to issue permits for large GHG emitters located in these states. This would be a temporary measure that is in place until a state can revise its own plan and resume responsibility for GHG permitting.

EPA will accept comment on the first proposal for updated state implementation plans for 30 days after publication in the Federal Register. EPA scheduled a hearing on the second proposal for the federal implementation plan on August 25, 2010, and will accept comment for 30 days afterward. The agency is working to finalize these rules prior to January 2, 2011, the date that the earliest GHG permitting requirements will be effective.

The Clean Air Act requires states to develop EPA-approved implementation plans that include requirements for issuing air permits. When federal permitting requirements change, as they did after EPA finalized the GHG Tailoring Rule, states may need to modify these plans. The Tailoring Rule covers large industrial facilities like power plants and oil refineries that are responsible for 70 percent of the GHGs from stationary sources.

To comment, visit www.regulations.gov and enter the docket number (EPA-HQ-OAR-2010-0107) under “Enter Keyword or ID.”

For additional information see: www.epa.gov/nsr/actions.html#aug10

COAL: EPA EXTENDS COMMENT PERIOD FOR ASH RULE

The Environmental Protection Agency (EPA) has extended the public comment deadline for proposed regulations for disposing of combustion ash from coal-burning power plants to Nov. 19. The period was originally scheduled to expire Sept 20.

EPA published two proposals in May for regulating coal ash under the Resource Conservation and Recovery Act. One would regulate ash as “hazardous,” setting binding disposal requirements for the waste that include an eventual ban on wet storage ponds. The other would classify the waste as nonhazardous and set federal disposal guidelines but leave enforcement to the states.

EPA began exploring federal regulations for coal ash after a wet storage pond at a Kingston, TN, power plant run by the Tennessee Valley Authority failed in December 2008, spilling about one billion gallons of sludge onto adjacent properties and waterways.

Environmental groups have been pushing for the “hazardous” designation, saying it is necessary to keep the waste from seeping into water supplies and wildlife habitat. The utility lobby, other industry organizations and some Members of Congress prefer the nonhazardous listing, saying that option protects recycling efforts while the alternative overestimates the environmental risks associated with coal ash.

The extension was formally published in the Aug. 20 edition of Federal Register.
To comment, visit www.regulations.gov and enter the docket number (EPA–HQ–RCRA–2009–0640) under “Enter Keyword or ID.”

For additional information see: www.epa.gov/epawaste/nonhaz/industrial/special/fossil/ccr-rule/index.htm

CARBON CAPTURE: FEDERAL TASK FORCE SENDS RECOMMENDATIONS TO PRESIDENT ON FOSTERING CLEAN COAL TECHNOLOGY

On August 12, 2010, President Obama’s Interagency Task Force on Carbon Capture and Storage (CCS), co-chaired by the U.S. Environmental Protection Agency (EPA) and the Department of Energy (DOE), delivered a series of recommendations to the president on overcoming the barriers to the widespread, cost-effective deployment of CCS within 10 years. The report concludes that CCS can play an important role in domestic greenhouse gas (GHG) emissions reductions while preserving the option of using coal and other abundant domestic fossil energy resources. The report’s main findings and recommendations include:

CCS is Viable: There are no insurmountable barriers to the deployment of this technology.

A Carbon Price is Critical: Widespread cost-effective deployment of CCS is best achieved with a carbon price, but there are market drivers and actions that can and are taking place now, which are essential to support near-term CCS demonstration projects that will pave the way for broader use after a carbon price is in place.

Federal Coordination should be Strengthened: The report recommends the creation of a standing federal agency roundtable and expert committee.

Recommendations on Liability: The task force conducted an in-depth analysis of options to address concerns that long-term liability could be a barrier to CCS deployment. It concluded that open-ended federal indemnification is not a viable alternative but that four approaches merit further consideration: relying on existing frameworks, limits on claims, a trust fund, and transfer of liability to the federal government (with contingencies).

Additional recommendations include setting up an effort by DOE and EPA – in consultation with other agencies – to track regulatory implementation for early commercial CCS demonstration projects and consider whether additional statutory revisions are needed.

CCS is a group of technologies for capturing, compressing, transporting and permanently storing power plant and industrial source emissions of carbon dioxide. Many experts consider CCS an important option as part of a portfolio of strategies – including increased efficiency and greater use of low-carbon energy resources -- to help mitigate growing atmospheric CO2 emissions from human sources. However, widespread cost-effective deployment of CCS will occur only if the technology is commercially available at economically competitive prices and supportive national policy frameworks, such as a cap on carbon pollution, are in place.

The full report and the presidential memorandum establishing the task force:
www.epa.gov/climatechange/policy/ccs_task_force.html and www.fe.doe.gov/programs/sequestration/ccs_task_force.html

BLM APPROVES LUCERNE VALLEY SOLAR PROJECT

A federal review of a proposed San Bernardino County, CA solar project has found the development would have minimal environmental impacts.

But the Bureau of Land Management recommended in its final environmental impact statement that Chevron Energy Solutions plant trees and shrubs in a 50-foot-wide strip between the road the company's Lucerne Valley Solar Project to shield equipment from residences, provide wildlife habitat and allow historical artifacts to remain in place.

Solar panels would occupy 516 acres and, if authorized, would be among the first commercial solar power projects approved for development on federal land. There is still a 30-day comment period before final approval.

The project is among nine solar projects the Interior Department has put on a “fast-track” review status so that, if authorized, they can qualify for stimulus loan guarantees and tax credits. The projects need to break ground by the end of the year to qualify for the subsidies.

Environmental groups including the Sierra Club, Wilderness Society and Natural Resources Defense Council are backing the Chevron project, saying the plan achieves a balance between developing ”clean energy” and protecting wildlife and plants.


Sources: ClimateWire, Environment and Energy Daily PM, The Environmental Protection Agency, Department of Interior, Greenwire, The Hill, Oil and Gas Journal, The New York Times, The Washington Post

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