AIR INNOVATIONS CONFERENCE August 11, 2004 FACILITATING SEPS

1. AIR INNOVATIONS CONFERENCEAugust 11, 2004FACILITATING SEPS

2. What Is A Supplemental Environmental Project? • Applied in the enforcement context • Voluntarily agreed to by the “violator” • Over and above what is legally required • Requires an environmental benefit • Must have a nexus with the violation • Results in penalty reduction

3. Specific SEP Policies • EPA has developed detailed SEP policies • Must improve public health or the environment • Cannot be inconsistent with underlying statute • EPA cannot manage or control the SEP funds • Type of project to be defined in the settlement • www.epa.gov/compliance/civil/program/seps • Many State agencies have developed their own policies, as well

4. SEPs from a “Violator’s” View • A SEP is one way of doing good, while reducing a penalty • SEPs require a nexus with the community affected by the violation, as such provide an opportunity for the violator to have a positive community impact

5. SEPs from an Agency’s View • Opportunity to obtain an environmental or public health risk benefit • Opportunity for innovative projects • Opportunity to achieve a project with minimal management/oversight costs • AN OPPORTUNITY FOR FUNDING

6. The StEPP Foundation • A national, 501(c)(3) not-for-profit • Established to identify viable clean energy, energy efficiency and pollution prevention projects meeting SEP criteria • “StEPP” stands for Strategic Environmental Project Pipeline • StEPP offers a turnkey solution for funding sources looking for viable projects

7. StEPP Foundation Services • Outreach to generate project ideas • Project identification and screening • Project management and oversight • Management of project monies • Accountability • Collection and reporting of environmental metrics for each project per dollar spent • Follow up, public relations, project promotion

8. The StEPP Process • Written project concepts are submitted online at a screening level of detail • Qualifying projects are available in the Project Pipeline • The Project Pipeline provides a selection of fundable projects • StEPP matches projects w/ negotiated criteria or provides a selection of projects

11. Second Phase of the Process • Once funding becomes available the applicant will be requested to submit a full proposal • Geographic location • Media/medium affected • Environmental category (e.g., REEE) • A committee made of a StEPP Board member, members of the community, experts will make its recommendation to the funding source • StEPP then manages the project thru completion

12. Results The result has been the funding of projects that directly benefit the communities around our facility – projects that we would not have had an opportunity to fund if it were not for the StEPP Foundation. I strongly recommend working with the StEPP Foundation Dennis Creamer, ConocoPhillips

13. REEE SEP Examples • A refiner in Colorado funded low interest home and small business loans for REEE • Energy supplier settled air violations & funded alternative energy projects including solar panel installations • Airport air violations settlement included replacement of traditional lights with energy efficient lighting

14. Other Examples • Solar panel installation for snow making at a ski area • Settlement funding into an escrow account used to pay for wind power over 5 years • University air violations resolution included improved insulation of campus buildings • CONTACT US: www.steppfoundation.org