EPA Mandates Greenhouse Gas Reporting

[OFICINA VIRTUAL APEV]

EPA Mandates Greenhouse Gas Reporting

By Jerry P. Bauer, PE, Associate Engineer- Environmental Group
Burns & McDonnell

On September 22, 2009, U.S. EPA Administrator Lisa Jackson signed the final rule requiring mandatory reporting of greenhouse gases (GHG) emissions from certain emission sources. Will the GHG reporting rule be the first domino in the series of regulations that will lead to regulation and control of GHG emissions? Or will the rule prove to be a red herring? Only will time will tell. One thing is certain: most power plants will be mandated to submit in 2011 a GHG report for calendar year 2010 activities.

Regulatory Background
The GHG reporting regulation was proposed on March 10, 2009. According to EPA, 17,000 comments were received regarding the proposed regulation. The rule was codified as 40 CFR Part 98 on September 22, 2009. The first reports for calendar year 2010 emissions are due by March 31, 2011. Differences between the proposed and final rule were generally targeted at lessening burdens on affected facilities.

Overview
EPA estimates that the reporting rule will affect an estimated 13,000 facilities. There are no provisions in the GHG reporting rule to force or even encourage "reducing" GHG emissions. It is strictly a "reporting" rule.

One of the more interesting features of the regulation is that EPA appeared to have developed the regulation in a vacuum with no particular attempt to be consistent with the industry standards and guidelines that had already been developed for completing GHG industries such as the World Resources Institute "Greenhouse Gas Protocol" or the "Climate Registry: General Reporting Protocol For the Voluntary Reporting Program".

The EPA reporting rule is on a "facility" basis; the voluntary reporting protocols are based on the entire company or organization. Thus, an investor-owned utility with 10 power generation sites will most likely be looking at submitting 10 GHG inventory reports. The "Scope 1 direct, Scope 2 direct, and Scope 3 indirect emission categories" that have become the lexicon for voluntary GHG reporting do not even appear in the 700-page GHG reporting rule.

In general, companies will find the EPA reporting rule less cumbersome than meeting the voluntary GHG reporting protocols. For instance, under the GHG reporting rule, an affected facility is not required to report GHG emissions from fuel combustion in company-owned vehicles nor emissions associated with purchased electricity. Under voluntary GHG protocols, reporting GHG emissions from fuel combustion in company-owned vehicles is mandatory (Scope 1 direct emission) as is reporting emissions from purchased electricity (Scope 2 indirect emission). Under the EPA reporting rule, fuel usage is captured "upstream" at the petroleum suppliers and thus not required to be reported by downstream users.

Which Facilities Must Report
The flow sheet below (reference EPA-430-F-09-006R, September 2009) provides a concise and simpler method (simpler than reading the entire regulation) to determine if a particulate facility is required to report.

Table 1 covers 17 source categories including: "Electricity Generation facilities that report CO2 emissions year round through 40 CFR Part 75".

Table 2 does not have any source categories typically pertinent to the electric utility industry.

Table 3 covers boilers, stationary internal combustion engines, process heaters, combustion turbines, and other fuel combustion equipment.

The bottom line is that most facilities that generate electricity will be required to report GHG emissions. The 25,000 ton CO2e threshold equates to the following approximate equivalents:



471,000 MMBtu/ 471 MMCF natural gas combustion

13,000 tons of coal

2,500,000 gallons of fuel oil

What Information Must Be Reported
Affected facilities will be required to report emission quantities of the following GHGs:


Carbon dioxide (CO2)

Methane (CH4)

Nitrous Oxide (N2O)

Sulfur hexafluoride (SF6)

Hydrofluorocarbons

Perfluorocarbons and other specific fluorinated gases.

The information required to be submitted by facilities that emit GHGs (as opposed to fuel suppliers) does not appear to be not particularly cumbersome:


Facility name and address

Annual emissions aggregated for all source categories

Annual emissions for each source category

Fuel use and other process data

Signed certification statement.

Power plants currently reporting CO2 emissions based on Continuous Emissions Monitoring (CEM) systems data will most likely be required to use the existing CEM data for CO2 emissions but will also have to use EPA default values to calculate and report CH4 and N2O emissions from fuel combustion.
Conclusions
As evidenced by the speed with which the GHG reporting regulation was finalized (six months from proposed to final is warp speed in the climate change regulation world), two conclusions can be drawn:



Climate change regulation is a top priority within the Obama Administration

There is no significant resistance to "reporting" GHG emissions (even from the global warming skeptics).

The fact that the GHG "reporting" rule flew through EPA does not necessarily mean that GHG "reduction" regulation is inevitable, for now. It just means that many facilities, including most power plants, will be required to submit another report to EPA. Only time will tell if the GHG reporting will go down as the first falling domino that led to GHG emissions control and reduction.