H. Rept. 114-445 - SATISFYING ENERGY NEEDS AND SAVING THE ENVIRONMENT ACT114th Congress (2015-2016)
Committee Report
| Report Type: | House Report |
|---|---|
| Accompanies: | H.R.3797 |
| Committees: |
H. Rept. 114-445 - 114th Congress (2015-2016)
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House Report 114-445 - SATISFYING ENERGY NEEDS AND SAVING THE ENVIRONMENT ACT
[House Report 114-445]
[From the U.S. Government Publishing Office]
114th Congress } { Report
HOUSE OF REPRESENTATIVES
2d Session } { 114-445
======================================================================
SATISFYING ENERGY NEEDS AND SAVING THE ENVIRONMENT ACT
_______
March 7, 2016.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Upton, from the Committee on Energy and Commerce, submitted the
following
R E P O R T
together with
DISSENTING VIEWS
[To accompany H.R. 3797]
[Including cost estimate of the Congressional Budget Office]
The Committee on Energy and Commerce, to whom was referred
the bill (H.R. 3797) to establish the bases by which the
Administrator of the Environmental Protection Agency shall
issue, implement, and enforce certain emission limitations and
allocations for existing electric utility steam generating
units that convert coal refuse into energy, having considered
the same, report favorably thereon without amendment and
recommend that the bill do pass.
CONTENTS
Page
Purpose and Summary.............................................. 2
Background and Need for Legislation.............................. 2
Hearings......................................................... 5
Committee Consideration.......................................... 5
Committee Votes.................................................. 5
Committee Oversight Findings..................................... 9
Statement of General Performance Goals and Objectives............ 9
New Budget Authority, Entitlement Authority, and Tax Expenditures 9
Earmark, Limited Tax Benefits, and Limited Tariff Benefits....... 9
Committee Cost Estimate.......................................... 9
Congressional Budget Office Estimate............................. 9
Federal Mandates Statement....................................... 10
Duplication of Federal Programs.................................. 10
Disclosure of Directed Rule Makings.............................. 10
Advisory Committee Statement..................................... 10
Applicability to Legislative Branch.............................. 11
Section-by-Section Analysis of the Legislation................... 11
Changes in Existing Law Made by the Bill, as Reported............ 11
Dissenting Views................................................. 12
PURPOSE AND SUMMARY
H.R. 3797, the Satisfying Energy Needs and Saving the
Environment (SENSE) Act, was introduced by Rep. Keith Rothfus
on October 22, 2015. The legislation addresses the application
of the Environmental Protection Agency's (EPA) Cross-State Air
Pollution Rule (CSAPR) and Mercury Air Toxic Standards (MATS)
rules, issued pursuant to sections 110 and 112 of the Clean Air
Act, to electric generating units that utilize coal refuse to
generate electricity and serve critical environmental cleanup
and remediation purposes. Key provisions of H.R. 3797 include
the following:
The bill would provide for limited
modifications with respect to the Cross-State Air
Pollution Rule by allocating additional sulfur dioxide
allowances to coal refuse-to-energy facilities.
The bill would provide for limited
modifications with respect to the Mercury and Air
Toxics Rule for these coal refuse facilities by
providing for alternative compliance options with
respect to sulfur dioxide and hydrogen chloride
emissions standards.
BACKGROUND AND NEED FOR LEGISLATION
This legislation seeks to ensure that innovative,
environmentally beneficial facilities that use coal refuse as
fuel, can continue to operate and will not be forced to shut
down, due to unachievable requirements included in the
Environmental Protection Agency's Cross-State Air Pollution
Rule (CSAPR)\1\ and the Mercury and Air Toxics Standards
(MATS).\2\
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\1\On July 6, 2011, the Environmental Protection Agency (EPA)
finalized the CSAPR. This rule was promulgated pursuant to section 110
of the Clean Air Act (CAA) and requires reductions in sulfur dioxide
(SO2) and nitrogen oxide (NOX) emissions from electric generating units
located in the 28 States covered by the rule.
\2\On February 16, 2012, EPA finalized the MATS rule. This rule was
promulgated pursuant to section 112 of the Clean Air Act and requires
reductions in emissions of mercury and other air toxics, as well as
certain acid gases from power plants. On June 29, 2015, the U.S.
Supreme Court ruled that EPA erred when the agency concluded that costs
did not need to be considered in the MATS rule. EPA is still in the
process of responding to this decision, and on November 20, 2015,
proposed a supplemental finding concluding that consideration of costs
would not have altered EPA's original rule.
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Coal refuse is the aboveground waste product of coal mining
found near many abandoned mines in Pennsylvania and other coal
mining areas.\3\ Coal refuse piles pose a number of
environmental and safety threats, and the cost of addressing
coal refuse has been estimated by State environmental
regulators to be approximately $2 billion dollars in
Pennsylvania alone, the most impacted State.
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\3\As the bill's sponsor, Rep. Rothfus testified at the
Subcommittee on Energy and Power's February 3, 2016 hearing on the
bill:
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[T]he coal industry has been a central part of
Pennsylvania's economy for many years. Unfortunately,
historic mining activity littered Pennsylvania and a few
other states with large piles of coal refuse (sometimes
called waste coal), which is essentially a mix of lower
quality coal, rocks, and dirt that remain after the mining
and processing of coal. Before technology was invented to
make use of this material, it accumulated in open spaces
alongside cities and towns, close to schools and
neighborhoods, and in fields across coal country.
Coal refuse-to-energy facilities are specialized power
plants developed to recycle the coal refuse by using it as an
energy source to generate affordable, reliable electricity.
There are 19 coal refuse-to-energy facilities, including 14 in
Pennsylvania. In addition to creating an estimated 1,200 direct
and 4,000 indirect jobs in areas, many of which are in
economically distressed, these facilities have thus far removed
214 million tons of coal refuse from the environment, at no
expense to taxpayers.\4\ As Rep. Rothfus testified at the
Subcommittee on Energy and Power's February 3, 2016 hearing on
H.R. 3797:
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\4\In Pennsylvania, coal refuse-to-energy facilities are recognized
in the Pennsylvania Alternative Energy Portfolio Standards Act. See
Testimony of Vince Brisini, Director of Environmental Affairs for
Olympus Power, LLC, testifying on behalf of ARIPPA, a trade association
representing the coal refuse energy industry, Preliminary Transcript
available at http://docs.house.gov/meetings/IF/IF03/20160203/104366/
HHRG-114-IF03-Transcript-20160203.pdf.
[The] coal refuse-to-energy industry has been a
leader on solving this problem. With advanced
technology, this industry has been able to use this
previously worthless material to generate affordable
and reliable energy. In the process, they have removed
over 200 million tons of coal refuse in Pennsylvania
alone and remediated many formerly-polluted sites.
Thanks to the hard work of the dedicated people in this
industry, landscapes have been restored, rivers and
streams have been brought back to life, and towns
across coal country have been relieved of unsafe and
unsightly waste coal piles.
And it is important to note that private sector
leadership on this issue has saved taxpayers millions
of dollars in cleanup costs. It has also created
hundreds of family-sustaining jobs in areas that have
been economically distressed for many years. These jobs
and the communities they support are at risk today,
unless we stand up to defend them.
Similarly, at the hearing, the Chairman of the Western
Pennsylvania Coalition for Abandoned Mine Reclamation, Dennis
Beck, testified that ``[t]hese waste plants are a great example
of ingenuity, cutting-edge technology and concern for the
environment.''
Despite the extraordinary environmental benefits of these
facilities, the EPA has included certain emissions limits in
the agency's CSAPR and MATS regulations that are not achievable
for all coal refuse-to-energy plants. If these facilities shut
down, the communities served by them will lose the electricity,
jobs, and environmental cleanup provided by these coal refuse-
to-energy plants.
What the legislation would do
The bill includes limited provisions that would allow these
innovative coal refuse-to-energy facilities to generate
affordable, reliable energy and continue their essential
environmental remediation work in a responsible manner.
Specifically, the bill would, with respect to the CSAPR,
allocate additional sulfur dioxide (SO2) allowances to coal
refuse-to-energy facilities. The allowances would be reduced
elsewhere in the program so the overall cap does not change.
The bill would, with respect to MATS, create an alternative
means of demonstrating compliance with the hydrochloric acid
(HCl) standard by using SO2 as a proxy and assuming that a 93
percent reduction in SO2 demonstrates compliance with the HCl
standard.
At the hearing on H.R. 3797, concerns were raised that the
bill would choose ``winners and losers,'' and that it favored
coal refuse plants at the expense of other facilities. In
response, Mr. Brisini testified that in this rulemaking EPA has
effectively chosen ``winners and losers,'' and stated:
I find it really interesting that we keep hearing
this--well, this SENSE Act picks winners and losers
when in fact the federal implementation plan picked the
winners and losers and they happened to pick in CSAPR
the bituminous coal-fired refuse plants to be the
losers in the CSAPR phase two allocation. . . . And
they also picked the bituminous coal-fired refuse
plants to be the loser in MATS because, as I have said
all along, the anthracite refuse plants can meet the
alternative 0.2 standard. . . . That is because the
sulfur content of the coal refuse in the anthracite
region is lower. It is not because the technology is
different or they have anything special and it is part
of the problem when you lump all of these things
together not recognizing the technical and the
differences in these kinds of fuels.
In addition, at the hearing, some suggested that coal
refuse-to-energy facilities can meet the requirements of the
MATS rule, citing the District of Columbia Court of Appeals
decision in White Stallion v. Environmental Protection
Agency.\5\ The court in that case, declined to create a
subcategory for coal refuse plants, finding that there were
plants that could achieve the HCL and SO2 standards in the MATS
rule. Notwithstanding the court's holding, Mr. Brisini
testified that as a practical matter only two coal refuse
plants are capable of meeting the limits. He specifically
testified: ``There are actually two bituminous plants that can
meet the hydrochloric acid [requirements]. No other plants,
whether they are bituminous coal refuse anthracite coal refuse,
they don't do it.''
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\5\See White Stallion Energy Center, LLC v. Environmental
Protection Agency, Case No. 12-1100, U.S. Court of Appeals for the
District of Columbia Circuit (April 15, 2014).
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Finally, at the hearing, suggestions were made that the
legislation was unnecessary because States could provide relief
to coal refuse facilities by reallocating allowances under
CSAPR. Mr. Brisini testified, however, that States would be
unlikely to provide timely relief because this would involve a
lengthy process requiring approval from EPA:
Now, as far as the authority to exempt or I can do a
surgical reallocation tomorrow, no, they can't. This is
a FIP. This is a federal implementation plan, and to
change that federal implementation plan you need a new
state implementation plan. EPA has up to 18 months to
respond to a federal implementation plan change. So the
idea that I can come in there and fix this tomorrow is
not true and I will say it that bluntly.\6\
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\6\Mr. Brisini further testified that ``Now, as far as the idea
that [the legislation] is usurping states' rights I find that
interesting because the federal government just did that in the FIP.''
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HEARINGS
The Subcommittee on Energy and Power held a hearing on HR
3797 on February 3, 2016. The hearing was entitled, ``H.R.
3797, the Satisfying Energy Needs and Saving the Environment
(SENSE) Act and H.R. __, the Blocking Regulatory Interference
from Closing Kilns (BRICK) Act'' and witnesses included the
following:
The Honorable Keith J. Rothfus, U.S. House
of Representatives, Pennsylvania;
Davis Henry, President and CEO, Henry Brick;
Creighton ``Butch'' McAvoy, President,
McAvoy Brick Company;
Vincent Brisini, Director of Environmental
Affairs for Olympus Power;
Dennis Beck, Chairman of the Western
Pennsylvania Coalition for Abandoned Mine Reclamation;
and,
John Walke, Senior Attorney and Clean Air
Director, Natural Resources Defense Council.
COMMITTEE CONSIDERATION
On February 11, 2016, the Subcommittee on Energy and Power
met in open markup session to consider H.R. 3797 and forwarded
the bill to the full Committee, without amendment, by voice
vote.
On February 25, 2016, the Committee on Energy and Commerce
met in open markup session to consider H.R. 3797. During the
markup, two amendments were offered and rejected by record
vote. A motion by Mr. Upton to order H.R. 3797 reported to the
House, without amendment, was agreed to by a record vote of 29
ayes and 22 nays.
COMMITTEE VOTES
Clause 3(b) of rule XIII of the Rules of the House of
Representatives requires the Committee to list the record votes
on the motion to report legislation and amendments thereto. The
following reflects the record votes taken during the Committee
consideration:
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
COMMITTEE OVERSIGHT FINDINGS
Pursuant to clause 3(c)(1) of rule XIII of the Rules of the
House of Representatives, the Committee made findings that are
reflected in this report.
STATEMENT OF GENERAL PERFORMANCE GOALS AND OBJECTIVES
H.R. 3797 would provide for limited modifications to CSAPR
for coal-refuse-to-energy facilities by allocating additional
SO2 allowances to coal refuse-to-energy facilities, and limited
modifications to MATS for these coal refuse facilities by
providing for alternative compliance options.
NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY, AND TAX EXPENDITURES
In compliance with clause 3(c)(2) of rule XIII of the Rules
of the House of Representatives, the Committee finds that H.R.
3797 would result in no new or increased budget authority,
entitlement authority, or tax expenditures or revenues.
EARMARK, LIMITED TAX BENEFITS, AND LIMITED TARIFF BENEFITS
In compliance with clause 9(e), 9(f), and 9(g) of rule XXI
of the Rules of the House of Representatives, the Committee
finds that H.R. 3797 contains no earmarks, limited tax
benefits, or limited tariff benefits.
COMMITTEE COST ESTIMATE
The Committee adopts as its own the cost estimate prepared
by the Director of the Congressional Budget Office pursuant to
section 402 of the Congressional Budget Act of 1974.
CONGRESSIONAL BUDGET OFFICE ESTIMATE
Pursuant to clause 3(c)(3) of rule XIII of the Rules of the
House of Representatives, the following is the cost estimate
provided by the Congressional Budget Office pursuant to section
402 of the Congressional Budget Act of 1974:
U.S. Congress,
Congressional Budget Office,
Washington, DC, March 4, 2016.
Hon. Fred Upton,
Chairman, Committee on Energy and Commerce,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 3797, the SENSE
Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Jon Sperl.
Sincerely,
Keith Hall.
Enclosure.
H.R. 3797--SENSE Act
H.R. 3797 would require the Environmental Protection Agency
(EPA) to provide greater flexibility to certain power plants
that are subject to emissions limitations under EPA's Cross-
State Air Pollution Rule (CSAPR) and the Mercury and Air Toxics
Standards for Power Plants (MATS). Affected power plants
generate electricity by burning coal refuse (a waste byproduct
of coal) as their primary fuel source.
The bill would require EPA to allocate to plants using coal
refuse in 2017 and subsequent years the same number of
emissions allowances for sulfur dioxide that have been
previously allocated to those plants, rather than reducing
allowances for those plants. The legislation also would
prohibit those plants from transferring unused allowances to
other entities and would allow coal refuse operators to bank
those allowances for use in future years. The bill would not
change the total number of allowances allocated to each state
under the CSAPR.
In addition, H.R. 3797 would require EPA to permit
operators of plants using coal refuse to comply with an
alternative emissions standard for sulfur dioxide that is less
stringent than the current MATS.
Based on information from EPA about the costs of modifying
its existing regulations to comply with this legislation, CBO
estimates that implementing H.R. 3797 would have an
insignificant cost to EPA. Because enacting H.R. 3797 would not
affect direct spending or revenues, pay-as-you-go procedures do
not apply.
CBO estimates that enacting H.R. 3797 would not increase
net direct spending or on-budget deficits in any of the four
consecutive 10-year periods beginning in 2027.
H.R. 3797 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act.
The CBO staff contact for this estimate is Jon Sperl. The
estimate was approved by H. Samuel Papenfuss, Deputy Assistant
Director for Budget Analysis.
FEDERAL MANDATES STATEMENT
The Committee adopts as its own the estimate of Federal
mandates prepared by the Director of the Congressional Budget
Office pursuant to section 423 of the Unfunded Mandates Reform
Act.
DUPLICATION OF FEDERAL PROGRAMS
No provision of H.R. 3797 establishes or reauthorizes a
program of the Federal Government known to be duplicative of
another Federal program, a program that was included in any
report from the Government Accountability Office to Congress
pursuant to section 21 of Public Law 111-139, or a program
related to a program identified in the most recent Catalog of
Federal Domestic Assistance.
DISCLOSURE OF DIRECTED RULE MAKINGS
The Committee estimates that enacting H.R. 3797
specifically directs to be completed no specific rulemakings
within the meaning of 5 U.S.C. 551 that would not otherwise be
issued by the agency.
ADVISORY COMMITTEE STATEMENT
No advisory committees within the meaning of section 5(b)
of the Federal Advisory Committee Act were created by this
legislation.
APPLICABILITY TO LEGISLATIVE BRANCH
The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of section
102(b)(3) of the Congressional Accountability Act.
SECTION-BY-SECTION ANALYSIS OF THE LEGISLATION
The legislation includes the following provisions:
Section 1. Short title
This section provides the short title of ``Satisfying
Energy Needs and Saving the Environment Act'' or the ``SENSE
Act''.
Section 2. Standards for coal refuse power plants
This section would modify the standards as they apply to
coal refuse power plants.
Section 2(a) provides definitions for the following terms:
administrator, boiler operating day, coal refuse, coal refuse
electric utility steam generating unit, coal refuse-fired
facility, Cross-State Air Pollution Rule, electric utility
steam generating unit, and Phase I of CSAPR.
Section 2(b) provides less restrictive sulfur dioxide
emissions allocations under CSAPR for coal refuse electric
utility steam generating units.
Section 2(c) provides an alternative compliance means for
HCl and SO2 under MATS for coal refuse electric
utility steam generating units.
CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED
This legislation does not amend any existing Federal
statute.
DISSENTING VIEWS
H.R. 3797, the ``Satisfying Energy Needs and Saving the
Environment (SENSE) Act,'' represents an effort by the
Republicans to give special breaks under two Clean Air Act
rules to power plants that use waste coal to generate
electricity. The rules--the Cross State Air Pollution Rule
(CSAPR) and the Mercury and Air Toxics Standards (MATS) rule--
are two of the most important rules for protecting public
health from toxic air pollutants like mercury and sulfur
dioxide. If this bill were to become law, waste coal facilities
would be able to pollute at a higher rate than other power
plants.
I. BACKGROUND
A. EPA's Cross-State Air Pollution Rule
To help 28 states in the eastern, central, and southern
United States meet the health-based ambient air quality
standards for fine particulate matter (PM2.5) and
ozone, the Environmental Protection Agency (EPA) issued the
Clean Air Interstate Rule (CAIR) in March 2005. Under the rule,
upwind states were required to reduce sulfur dioxide
(SO2) and nitrogen oxides (NOX)
emissions.\1\ This rule was promulgated pursuant to Clean Air
Act section 110(a)(2)(D)(i)(I), which is known as the ``good
neighbor provision.'' CAIR was overturned by the D.C. Circuit
Court of Appeals in 2008.\2\
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\1\U.S. EPA, EPA Announces Landmark Clean Air Interstate Rule--
Major Step Forward in Eliminating `Smog' Days in New England (Mar. 10,
2005) (online at yosemite.epa.gov/opa/admpress.nsf/
dc614f1d30c3fd66852572a000657b5a/
ff502720c7a5c8d2852570ca006ab475!OpenDocument).
\2\State of North Carolina v. EPA (D.C. Cir. 2008) (on petitions
for rehearing); State of North Carolina v. EPA, Reply in Support of
Petition for Rehearing or Rehearing En Banc (Nov. 17, 2008).
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EPA promulgated CSAPR as a replacement for CAIR on July 6,
2011.\3\ CSAPR requires states in the eastern, central, and
southern United States to reduce power plant emissions that
cause air quality problems in other states.
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\3\U.S. EPA, Federal Implementation Plans: Interstate Transport of
Fine Particulate Matter and Ozone and Correction of SIP Approvals;
Final Rule, 76 Fed. Reg. 48208 (Aug. 8, 2011) (final rule) (hereinafter
``Cross-State Air Pollution Rule'').
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The timing of CSAPR's implementation has been affected by a
number of court actions.\4\ On April 29, 2014, the U.S. Supreme
Court issued an opinion reversing an earlier D.C. Circuit
decision that had vacated the rule. Subsequently, on October
23, 2014, the D.C. Circuit lifted its prior CSPAR stay.\5\ The
D.C. Circuit also granted EPA's request to delay the rule's
compliance deadlines by three years. Accordingly, CSAPR Phase 1
implementation began in 2015, with Phase 2 beginning in
2017.\6\ In December 2015, EPA proposed the CSAPR Update Rule
to address interstate transport of air pollution under the 2008
ozone National Ambient Air Quality Standards (NAAQS).\7\
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\4\On December 30, 2011, CSAPR was stayed prior to implementation.
On August 21, 2012, CSAPR was vacated. EME Homer City Generation, L.P.
v. EPA, No. 11-1302 (D.C. Cir. Aug. 21, 2012) (online at
www.cadc.uscourts.gov/internet/opinions.nsf/19346B280C78405C852
57A61004DC0E5/$file/11-1302-1390314.pdf).
\5\EPA v. EME Homer City Generation, L.P., No. 12-1182, Slip Op.
(2013) (online at www.supremecourt.gov/opinions/13pdf/12-
1182_553a.pdf); Order Granting EPA's Motion to Lift the Stay of the
Transport Rule, EME Homer City Generation, L.P. v. EPA, No. 11-1302
(D.C. Cir.) (online at www3.epa.gov/airtransport/CSAPR/pdfs/
CSAPR_Stay_Lift.pdf).
\6\U.S. EPA, Cross-State Air Pollution Rule (CSAPR) (accessed Jan.
31, 2016) (online at www3.epa.gov/crossstaterule/).
\7\U.S. EPA, Cross-State Air Pollution Rule Update for the 2008
Ozone NAAQS, 80 Fed. Reg. 75706 (Dec. 3, 2015) (proposed rule).
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In the CSAPR rules, EPA provides a multi-step process to
address the requirements of the good neighbor provision. Under
that process, if EPA determines that a downwind state expects
to have problems attaining or maintaining an air quality
standard, EPA would then look at which upwind states are
contributing to these identified problems. EPA would then set
up an ``emissions budget'' for those upwind states found to
have emissions that significantly contributed to problems in a
downwind state. A given state's emissions budget represents the
allowable amount for emissions, after identifying and
accounting for those emissions contributing significantly to
nonattainment by a downwind state.\8\
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\8\U.S. EPA, Cross-State Air Pollution Rule Presentation (Dec. 15,
2011) (online at www3.epa.gov/crossstaterule/pdfs/
CSAPRPresentation.pdf); U.S. EPA, FACT SHEET: The Cross-State Air
Pollution Rule: Reducing the Interstate Transport of Fine Particulate
Matter and Ozone (July 18, 2011) (online at www3.epa.gov/
crossstaterule/pdfs/CSAPRFactsheet.pdf).
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Once a state's emissions budget was established, EPA set up
a tradable allowance program for the power plants covered by
CSAPR. Power plants within a state were allocated emissions
allowances that could be traded--subject to some requirements--
as needed to comply with the rule. Alternatively, states had
the option of developing their own state implementation plan
(SIP) to meet the rule's required emissions reductions.\9\
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\9\Id.
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B. Clean Air Act Section 112
Section 112 of the Clean Air Act requires the EPA to set
technology-based standards to reduce air toxics. These
hazardous air pollutants (HAPs) are known or suspected to cause
cancer or other serious health effects, such as reproductive or
birth defects or neurological effects, or adverse environmental
effects. EPA rule makings aim to reduce the release of 187 HAPs
including mercury, cadmium, lead, benzene and dioxin.\10\ EPA
takes a technology-based approach to regulating HAPs in order
to achieve substantial reductions in air toxics relatively
quickly using readily available technology. EPA also follows
the technology-based standards with additional standards where
needed to protect health, as determined through risk
assessments.\11\
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\10\U.S. Environmental Protection Agency, About Air Toxics (online
at www.epa.gov/oar/toxicair/newtoxics.html).
\11\Clean Air Act Sec. 112(f).
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Section 112 requires EPA to develop regulations for
distinct source categories (e.g., power plants, boilers, and
cement kilns) that set specific emission limits based on the
emission levels already being achieved by similar facilities.
These regulations are known as Maximum Achievable Control
Technology (MACT) standards. For existing sources, the emission
standard must be at least as stringent as the average emissions
achieved by the best-performing 12 percent of sources in that
source category. For new sources, the emission standard must be
at least as stringent as the emission control achieved by the
best-controlled similar source.\12\ These minimum emissions
levels are known as the MACT floor.
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\12\Id. at Sec. 112(d)(3).
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C. EPA's Mercury and Air Toxics (MATS) Rule
Section 112 of the Clean Air Act directs EPA to complete a
study of the hazards to public health reasonably anticipated to
occur as a result of toxic air pollution from power plants. EPA
completed the study and concluded that it was appropriate and
necessary to regulate HAPs from power plants.\13\ Power plants
are by far the largest U.S. source of mercury emissions into
the air, and they also release other toxic metals, such as
arsenic, chromium and nickel, which can cause cancer and other
serious health harm.
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\13\U.S. EPA, Study of Hazardous Air Pollutant Emissions from
Electric Utility Steam Generating Units--Final Report to Congress,
Volume 1 (Feb. 1998).
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EPA's finding triggered a requirement for the Agency to
finalize regulations to control toxic air pollution from power
plants. In 2012, EPA issued the MATS rule, which established
the first national standards to address power plant emissions
of mercury and toxic air pollution.\14\ There were no federal
standards requiring power plants to limit their emissions prior
to this rule--despite the availability of proven control
technologies, and the passage of more than 20 years from
enactment of the 1990 Clean Air Act Amendments.\15\
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\14\U.S. EPA, National Emission Standards for Hazardous Air
Pollutants from Coal-and Oil-fired Electric Utility Steam Generating
Units and Standards of Performance for Fossil-Fuel-Fired Electric
Utility, Industrial-Commercial-Institutional, and Small Industrial-
Commercial-Institutional Steam Generating Units, 77 Fed. Reg. 9034
(Feb. 16, 2012) (final rule) (online at www.gpo.gov/fdsys/pkg/FR-2012-
02-16/pdf/2012-806.pdf) (hereinafter ``MATS Final Rule'').
\15\U.S. EPA, Mercury and Air Toxics Standards (MATS) Basic
Information (accessed Jan. 31, 2016) (online at www3.epa.gov/mats/
basic.html).
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EPA's MATS rule establishes MACT standards for HAPs emitted
from coal- and oil-fired power plants, limiting the emissions
of heavy metals and acid gases\16\ from these sources. The
final rule will prevent 90 percent of the mercury in coal
burned at power plants from being released.\17\ To achieve
these reductions, the MATS rule sets numeric emissions limits
for mercury, particulate matter (as a surrogate for other heavy
metals), and acid gases for all existing and new coal-fired and
oil-fired units.
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\16\Heavy metals such as mercury, arsenic, and chromium, and acid
gases such as hydrochloric acid (HCl) and hydrofluoric acid (HF).
\17\U.S. EPA, Fact Sheet: Mercury and Air Toxics Standards for
Power Plants (Dec. 2011) (online at www.epa.gov/airquality/
powerplanttoxics/pdfs/20111221MATSsummary fs.pdf).
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The MATS rule also establishes work practice standards,
rather than numeric emissions limits, to reduce emissions of
certain organic HAPs, including dioxin/furan, that are a
product of inefficient combustion. These work practice
standards merely require utilities to perform annual
maintenance and inspection at covered units to improve
efficiency.\18\
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\18\Id.
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Existing sources had three years--or until April 16, 2015--
to comply with the rule. In the final rule, EPA made it clear
that the option of a fourth year--until April 16, 2016--for
compliance would be broadly available.\19\
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\19\U.S. EPA, Mercury and Air Toxics Standards (MATS) Basic
Information (accessed Jan. 31, 2016) (online at www3.epa.gov/mats/
basic.html); U.S. EPA, MATS Final Rule, 77 Fed. Reg. 9304, at 9410
(``We believe that the permitting authorities have the discretion to
use this extension authority to address a range of situations in which
installation schedules may take more than 3 years'').
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During the MATS rulemaking process, EPA identified several
power plants that, based on the data available, exhibited the
ability to achieve all of the MACT standards for existing
sources.\20\ Among those sources are both pulverized coal and
circulating fluidized-bed power plants, and power plants
burning bituminous coal, subbituminous coal, lignite, and coal
refuse (or waste coal). The EPA has also noted that there are
waste coal units that have installed add-on control technology
that will allow them to be in compliance with MATS
requirements.\21\
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\20\U.S. EPA, MATS Final Rule, 77 Fed. Reg. 9304, at 9397.
\21\U.S. EPA, EPA's Responses to Public Comments on EPA's National
Emission Standards for Hazardous Air Pollutants from Coal- and Oil-
Fired Electric Utility Steam Generating Units, p. 761 (Dec. 2011)
(online at www3.epa.gov/airtoxics/utility/mats_rtc_chapters_foreword-1-
2-3-4_121611.pdf).
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A number of groups submitted comments on the MATS rule
urging EPA to create a separate subcategory for waste coal
units.\22\ However, in the final MATS rule, EPA noted that the
HAP emissions from waste coal units are not sufficiently
different from emissions from coal-fired power plants to
warrant further subcategorization or a separate MACT floor.\23\
This approach was upheld by the D.C. Circuit Court of Appeals
which concluded that ``. . . EPA reasonably decided that
separate standards for coal-refuse-fired [circulating fluidized
bed power plants] were not warranted.''\24\
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\22\U.S. EPA, MATS Final Rule, 77 Fed. Reg. 9304, at 9396-9397.
\23\Id. at 9395.
\24\White Stallion Energy Center, LLC v. EPA, 748 F.3d 1222, at
1250 (D.C. Cir. Apr. 15, 2014).
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D. Use of waste coal
As noted above, a subset of power plants in the U.S. burn
waste coal as their fuel source. This waste coal is a byproduct
of coal mining, physical coal cleaning, and other coal
preparation operations, and also contains matrix materials,
clay and other organic and inorganic materials.\25\ Waste coal
is primarily found in large piles near abandoned mines, and
once burned the resulting ashes are used in mine reclamation
projects.\26\ The majority of these power plants are in
Pennsylvania; however, some are located in other states like
West Virginia and Utah.
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\25\U.S. EPA, MATS Final Rule, 77 Fed. Reg. 9304, at 9484.
\26\White Stallion Energy Center at 1250.
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II. H.R. 3797, THE SATISFYING ENERGY NEEDS AND SAVING THE ENVIRONMENT
(SENSE) ACT
A. Summary of the SENSE Act
Section 2(b) relates to the treatment of waste coal
facilities under CSAPR. The section requires the EPA
Administrator to ensure that power plants using waste coal
derived from bituminous coal would maintain the same allocation
of Phase 1 SO2 emissions allowances under Phase 2. Section
2(b)(1)(C) prohibits these waste coal plants from trading or
banking the additional SO2 emissions allowances. Section
2(b)(2) prohibits the EPA Administrator from increasing a
state's emissions budget in Phase 2 to account for the extra
allowances allocated to waste coal units.
Section 2(c) relates to the treatment of waste coal
facilities under MATS.\27\ Specifically, section 2(c)(2)(v)
provides an additional compliance option for the hydrogen
chloride (HCl) and SO2 standard, allowing waste coal
facilities--or a group of waste coal facilities--to capture and
control 93 percent of SO2 emissions.
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\27\Note: section 2(c) is not limited just to waste coal units
burning bituminous coal.
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B. Issues raised by the SENSE Act
The CSAPR provisions in section 2(b) raise a number of
concerns. First, in the absence of the bill, Phase 2 SO2
emissions allowance allocations would likely have decreased for
all, or at least most, of the existing waste coal units.
Second, preventing any increase to a state's emissions budget,
as this section would do, is ostensibly to limit the impact of
the resulting increased pollution from waste coal facilities on
downwind states. However, the result of this provision would be
that other power plants in a given state that are covered by
CSAPR will have to cut their emissions to make up the
difference. Third, this section gives the EPA Administrator a
number of new authorities that the Clean Air Act currently
reserves to states by tasking the Administrator with providing
and allocating CSAPR emissions allowances.
In essence, section 2(b) picks winners and losers--tipping
the scales in favor of bituminous waste coal units, at the
expense of all other covered units within a state. This
provision would artificially reallocate emissions allowances,
alter the CSPAR trading system, create inequities in the
market, and impede a state's right to determine how to best
comply with the requirements of the rule. In submitted
testimony, EPA noted that the bill's changes to the CSAPR
program ``would remove economic incentives to reduce emissions
at coal refuse plants,'' and ultimately would result in ``a
less efficient and more costly compliance with CSAPR.''\28\
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\28\House Committee on Energy and Commerce, Subcommittee on Energy
and Power, Written Statement of Janet McCabe, Acting Administrator,
Office of Air and Radiation, U.S. Environmental Protection Agency
(EPA), Legislative Hearing on H.R. 3797, the Satisfying Energy Needs
and Saving the Environment Act (SENSE) Act and H.R. __, the Blocking
Regulatory Interference from Closing Kilns (BRICK) Act, 114th Cong.
(Feb. 3, 2016) (online at docs.house.gov/meetings/IF/IF03/20160203/
104366/HHRG-114-IF03-20160203-SD004.pdf) (hereinafter ``Subcommittee
Legislative Hearing'').
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Further, if a state wishes to allocate additional
allowances to waste coal plants, it can already do so through
the SIP process. During the subcommittee legislative hearing,
John Walke from the Natural Resources Defense Council noted,
``States today have the authority to differently allocate
allowances within the emitters in their state. . . . So if
Pennsylvania wants to incentivize waste coal energy production,
they can do so by reallocating sulfur dioxide allowances within
the electric sector.''\29\ EPA also raised concerns with this
provision since it ``would potentially deny states control over
allocations of allowances by rendering any submitted state plan
with a different allocation to these units unapprovable'' by
the Agency.\30\
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\29\Subcommittee Legislative Hearing, Response to Questions of John
Walke, Natural Resources Defense Council (online at democrats-
energycommerce.house.gov/committee-activity/hearings/hearing-on-hr-
3797-the-satisfying-energy-needs-and-saving-the-0).
\30\Subcommittee Legislative Hearing, Written Statement of Janet
McCabe, Acting Administrator, Office of Air and Radiation, U.S.
Environmental Protection Agency (EPA) (online at docs.house.gov/
meetings/IF/IF03/20160203/104366/HHRG-114-IF03-20160203-SD004.pdf).
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The MATS provisions in section 2(c) also raise a number of
concerns. It is not known how many facilities would opt for the
bill's new compliance option, but the end result is likely
additional emissions of air pollutants. Proponents argue that
waste coal plants are unable to meet the current HCl and SO2
limits and need an alternative pathway to comply with the MATS
rule. However a less stringent SO2 standard is not necessary
since existing technology is capable of controlling 99 percent
of HCl and 96 percent of SO2.\31\ At the hearing, Mr. Walke
explained that ``[i]t is simply incorrect to suggest that coal
waste plants burning any type of coal waste are incapable of
achieving either the HCl or the SO2 standard in the existing
MATS rule'' and that,
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\31\U.S. EPA, Regulatory Impact Analysis for the Final Mercury and
Air Toxics Standards, at 2-8--2-9 (Dec. 2011) (online at www3.epa.gov/
ttn/ecas/regdata/RIAs/matsriafinal.pdf).
[W]hen the D.C. Circuit in its decision heard the full
legal arguments from the trade association for waste
coal operators and looked at all the evidence they
presented and the evidence in the administrative record
that EPA had compiled, they squarely rejected those
claims in a three to nothing decision and that decision
was left untouched by the Supreme Court in that
relevant Respect.\32\
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\32\Subcommittee Legislative Hearing, Response to Questions of John
Walke, Natural Resources Defense Council (online at democrats-
energycommerce.house.gov/committee-activity/hearings/hearing-on-hr-
3797-the-satisfying-energy-needs-and-saving-the-0).
Democratic members offered two amendments during the full
committee markup to address the concerns raised by the SENSE
Act. Ranking Member Pallone offered an amendment to strike the
bill's CSAPR sections, highlighting that the provision is
unnecessary since states already have the ability to reallocate
emissions allowances to benefit waste coal units if they so
choose. Rep. Engel offered an amendment allowing a state to
opt-out of the bill's CSAPR provisions if it determined that
doing so would lead to an increase in the overall cost of
complying with EPA's rule. The Engel amendment highlights EPA's
concern that the bill interferes with the CSAPR market and
would likely result in less efficient and more costly
compliance. Both amendments also address the bill's states'
rights issues by preserving a state's ability to determine the
best method of compliance with CSAPR, which is currently
afforded to them under the Clean Air Act. The Pallone and Engel
amendments were each defeated by a party line vote of 22-29.
III. CONCLUSION
We oppose H.R. 3797 and the legislative remedy offered by
this bill. It comes as no surprise that the majority is once
again offering legislation to undermine Clean Air Act
regulations to benefit coal-fired power plants at the expense
of public health. What is surprising is that the SENSE Act puts
major coal-fired plants at a disadvantage relative to waste
coal plants that receive regulatory relief under this
legislation. H.R. 3797 undermines states' authorities to
develop emission budgets tailored to the specific emission
sources in their power and industrial sectors. And, H.R. 3797
undermines the proven market-based approach of using emission
credits to achieve improved air quality at the lowest cost.
All of this is being done to benefit the approximately 20
waste coal plants that exist in a handful of states. While
these plants address one of coal's major legacy problems--
dangerous, polluting piles of coal mine tailings from abandoned
coal mining operations--cleanup of these piles can and should
be done without undue transfer of mercury, SO2 and other
pollutants from the land to the air.
It is ironic that those who routinely accuse President
Obama and his administration of waging a ``war on coal'' are
supporting H.R. 3797, a bill that will place greater emission
reduction burdens on coal-fired utilities to allow waste coal
facilities to emit more pollutants. The bill also deprives
facilities of valuable emission credits that they would
otherwise gain under current law for converting to natural gas
or otherwise reducing their emissions.
None of this is necessary. The states already have the
authority to allocate additional emission allowances to waste
coal plants if they choose to do so under CSAPR. This bill
imposes a specific allocation solution on the states, a one-
size-fits-all solution that allows waste coal plants to emit
more pollutants. In addition, there is no evidence that more
generous emission allocations are necessary. There are waste
coal plants that meet the CSAPR and MATS regulations today and
there is technology available to enable waste coal plants to
comply with the requirements of these rules. There is no
justification for treating them differently from other coal-
fired generation facilities.
For the reasons stated above, we dissent from the views
contained in the Committee's report.
Frank Pallone, Jr.,
Ranking Member, Committee on
Energy and Commerce.
Bobby L. Rush,
Ranking Member, Subcommittee
on Energy and Power.
[all]