White House releases sweeping regulatory agenda

Source: Amanda Peterka and Jean Chemnick, E&E reporters • Posted: Wednesday, May 28, 2014

The White House on Friday released its latest regulatory agenda, a sweeping plan that includes rules on power plants, renewable fuels, ozone pollution, Clean Water Act jurisdiction and disclosure of payments by oil and gas companies.

The spring issue of the biannual “Unified Agenda of Federal and Regulatory and Deregulatory Actions” details both short- and long-term plans for every agency in the government.

The most notable goals include timelines for the release of greenhouse gas emission standards, proposed 2015 renewable fuel standard targets, a controversial stream protection rule, crude-by-rail safety standards, and methane and hydraulic fracturing regulations.

For U.S. EPA, the White House plan lists more than 130 regulatory items on the agenda from marquee items to mundane actions. The agenda lays out the schedule for three much-anticipated rules to curb greenhouse gas emissions from new, modified and existing power plants.

The New Source Performance Standard (NSPS) for new fossil fuels power plants will be finalized in January 2015, it says.

The proposal was released in September and published in the Federal Register in January — a 3½-month delay that Republicans on Capitol Hill have attributed to administration skittishness about finalizing it before this November’s midterm elections. The rule would mandate that all new coal-fired power plants use partial carbon capture and storage technology, a requirement that critics say would effectively bar investment in new coal-fired generation.

Republicans have promised to make the rule an issue in congressional races in fossil-fuels states this fall, and last week seven moderate Democratic senators asked President Obama to direct EPA to reconsider the proposal. They argued that CCS has not yet been demonstrated on an operating commercial-scale power plant.

Little is known about EPA’s proposal for modified and reconstructed power plants, which was sent to the White House’s Office of Management and Budget on April 21. The agenda shows that the rule will be proposed in June 2014 and finalized in June 2015 — a schedule that tracks roughly with the one for existing power plant rules. Environmentalists who follow the regulations say they expect the rule for modified plants to be proposed concurrently with the one for existing power plants on June 2, or soon after.

No rule has prompted more speculation and analysis than the one OMB is currently reviewing for emissions from existing power plants. The rule will cover a sector that contributes 40 percent of U.S. carbon emissions, and Obama made it the cornerstone of his Climate Action Plan last year.

The agency and administration have kept mum about what form the rule will take, except to say that it will be “flexible” but will achieve significant emissions reductions. There have been reports that the rule will aim for a 25 percent reduction in emissions by 2039, but those reports do not give a base-line year and have been disputed.

The agenda reaffirms the president’s pledge that the rule should be proposed this June and finalized next June. It also notes that a memorandum he signed last year directs EPA to “require states to submit to EPA the implementation plans required under Section 111(d) of the Clean Air Act by no later than June 2016.”

While EPA has said it will meet the schedule for its proposal and final rule, states have urged it to give them more time to craft implementation plans. Many expect the agency to do so.

Other EPA rules

Among the new items on the agenda is a plan to unveil proposed 2015 renewable fuel standard targets in the fall.

Under the timeline, the agency would release a proposed rule setting the standards in September and finalize them by March. Although the timeline would set up the agency to release the standards earlier in the compliance year, EPA would still slip past the Nov. 30 statutory deadline for issuing the RFS rule.

EPA is still aiming for a June release of a controversial rule setting the 2014 volume requirements for renewable fuels, though as of this morning the agency had yet to send the rule to the White House Office of Management and Budget for review.

EPA’s proposal, which represents the first rollback of the nation’s biofuel blending mandate, has sparked harsh criticism among biofuels and farm interests. The agency has also come under fire each year for issuing the rule late. Refiners say a late release makes compliance more difficult.

EPA is also working on finalizing in June a rule that would allow renewable fuels made from landfill biogas, as well as isobutanol, to qualify for advanced biofuel credit under the RFS. The agency also plans to release in June a final rule that’s been in progress for more than a year creating a quality assurance program for renewable fuel credits, a measure meant to root out fraud that’s dogged the biodiesel industry (Greenwire, Feb. 26). Both rules are currently at the White House for review.

EPA also plans to complete by the end of the year a high-profile review of its ozone standard, which was last set in 2008 at a level of 75 parts per billion. The agency’s Clean Air Scientific Advisory Committee is scheduled to hold a teleconference meeting tomorrow to issue a recommendation on where the agency should set the standard. The agency is under court order to propose a draft ozone rule by Dec. 1 and to finalize it by October 2015.

The agenda also sets a target date for a controversial regulation aimed at clarifying which streams, creeks and wetlands receive protection under the Clean Water Act to be finalized in April of next year. The Obama administration unveiled its proposed rule in late March, and the comment period is set to close July 21. Congressional Republicans and a number of industry groups have staunchly opposed the proposal and vowed to fight it, including through this year’s appropriations process.

Coal and mining

The federal Office of Surface Mining predicts it will propose its controversial stream protection rule, meant to safeguard waterways from coal strip mining, by December of this year.

The agency has been working on the rulemaking for several years to replace a President George W. Bush-era standard, which a federal judge struck down earlier this year.

Another pending OSM proposal would protect states from liability for using coal mine reclamation dollars for abandoned hardrock mine cleanups. The rule would only apply to states that have finished cleaning up their priority coal mines. Sen. Jon Tester (D-Mont.) was a catalyst behind the measure.

OSM is also working on proposals to govern the temporary shutdown of mines, the use of coal ash in mining and coal slurry impoundment safety.

The Bureau of Land Management is currently accepting public comment on potential rulemaking to control methane releases from mines on public land.

BLM also expects to finish by early next year mining-related rules to codify stipulations within the Energy Policy Act of 2005, including boosting the royalty rate for companies that use highwall mining (Greenwire, Aug. 9, 2013).

EPA expects to finish rulemaking to govern coal ash disposal by December. EPA is also working on a series of measures to boost oversight of uranium milling and extraction (Greenwire, May 2).

In the arena of worker safety, the Labor Department is for the first time publishing in the regulatory agenda potential rulemaking to protect coal miners seeking benefits for black lung disease.

“To ensure that coal miners have full access to information about their health and to enhance the accuracy of entitlement determinations,” the agenda says, “this rule would address disclosure of medical evidence.”

The Mine Safety and Health Administration has several proposals on the drawing board, including a long-pending one to protect workers from mining machines. The agency expects final action by June.

Oil by rail and pipelines

The Pipeline and Hazardous Materials Safety Administration signaled in the agenda that it plans to formally propose new crude-by-rail safety standards in July — the anniversary of a deadly derailment of a train carrying light oil from the Bakken Shale play in the town of Lac-Mégantic, Quebec. New rules for oil-train tank cars are broadly supported by Congress, the oil industry and railways, but clamoring for PHMSA to pick up the pace on oversight may not stop the rulemaking process from becoming a food fight if the administration pushes for stricter standards on the operation of oil trains as well as tank car construction (E&E Daily, March 7).

Also on the docket for PHMSA in August, according to the agenda, is a proposed rule to require excess flow valves on natural gas pipelines running through buildings beside single-family homes. That issue leapt to prominence after an aging gas line fatally ruptured in the California city of San Bruno in 2010, though the agency has long missed Congress’ 18-month window for new regulations set in late 2011.

Similarly delayed since its appearance in a 2011 pipeline safety reauthorization law — but now poised for release in July, the agenda states — is a broad PHMSA reassessment of current oil pipeline safety rules, including leak detection programs that a third-party audit slammed in 2012 as lacking in uniform performance standards to measure the industry’s success at stopping spills (E&E Daily, Oct. 31, 2013).

Interior

The Interior Department appears poised to release a bevy of proposed and final rules regulating energy development on public lands in the coming months.

BLM set a December target for issuing a proposed rule to update regulations for methane emissions from oil and gas leases on public lands, which is part of Obama’s sweeping climate change agenda.

BLM also set a September deadline to issue a final rule regulating the controversial but common practice of hydraulic fracturing on public lands.

The agency by the end of the year may also complete a rule determining what royalties energy firms must pay to develop oil shale in Colorado, Utah and Wyoming, a move likely to be closely watched by skeptical environmental groups and local communities.

BLM also set an August target for issuing a proposed rule for establishing a competitive leasing program for wind and solar on public lands. That proposal is currently under review at the Office of Management and Budget.

Interior’s offshore energy bureaus are apparently targeting this fall to release proposed rules for the development of oil and gas in the Arctic and to update requirements for blowout preventers.

Securities and Exchange Commission

According to the plan, the Securities and Exchange Commission is aiming for a spring rollout of a new proposal to require oil and mining companies to disclose the money they pay to U.S. foreign governments.

Human rights advocates and Democrats in Congress have called for a speedy release of the rule after a federal court struck down the agency’s first attempt last year. The rule called on publicly listed extraction companies to report to the SEC, on a project-by-project basis, the money they pay to governments. It allowed for no exemptions in countries that have forbidden such disclosure.

Oil industry and business groups successfully challenged the rule, which was required by the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act. They argued that it would saddle companies with heavy compliance costs and put them at a competitive disadvantage to state-owned companies in places like Russia and China.

Both proponents and critics of the provision have swamped the SEC’s office in recent months as the agency prepares to rewrite the rule.

NOAA

A couple of rules from the National Oceanic and Atmospheric Administration may garner the attention of both environmentalists and the energy sector. The agency’s fisheries arm plans to propose critical habitat for the endangered North Atlantic right whale, a species believed to number in the hundreds. Earlier this month, the developer of a wind project off the New England coast vowed to minimize harm for the animal as it moves forward with preconstruction (Greenwire, May 7). A critical habitat designation could also affect oil and gas exploration farther south in the Atlantic, where models have predicted that the uptick in whale activity may result in ship strikes.

Another rule from the National Marine Fisheries Service would move forward regarding the take of marine mammals during oil and gas exploration in the Gulf of Mexico. The agency received an application for the rules from Interior, the Bureau of Ocean Energy Management and the Bureau of Safety and Environmental Enforcement in April 2011, following concerns that proposed seismic surveys in the Gulf’s outer continental shelf could disturb marine mammals.

Transportation

The Federal Highway Administration, the Federal Transit Administration and other branches of the Transportation Department collectively have more than 150 rulemakings on the list.

Among them are more than 30 required under MAP-21, the 2012 highway and transit funding law, covering such areas as the Congestion Mitigation and Air Quality Improvement Program; national goals and performance management measures; and bus testing.