GHG Mandatory Reporting Rule: Proposal Overview

1. GHG Mandatory Reporting Rule:Proposal Overview Presented to Philadelphia Diesel Difference Working Group By Jim Smith, EPA Region 3 November 9, 2009

2. Outline Background / Purpose Summary of Rule Who Reports Gases Covered Sources Covered Related Issues Sources of Information

3. Background • Directed by Congress in 2008 Appropriations Act • Proposal signed March 10, 2009 • Public Comment Period (April 10 – June 10, 2009) • Final rule signed September 22, 2009 • Published in Federal Register October 30, 2009 • Takes Effect December 29, 2009 JAMES D. SMITH 3

4. Main Purpose • Provide accurate and timely data to inform future climate change policies and programs • Better understand relative emissions of specific industries, and of individual facilities within those industries • Better understand factors that influence GHG emission rates and actions facilities could take to reduce emissions • Does not require control of GHG JAMES D. SMITH 4

5. Other Aims • Minimize the number of sources and cost of reporting yet maximize the quantity of emissions: • The 25,000 ton threshold captures 85% of emissions from roughly 10,000 facilities • 25,000 mtCO2e are equivalent to emissions from the annual energy use of approximately 2,300 homes. • Minimize the number of sources required to calculate emissions to determine applicability: • Equivalent capacity thresholds were provided when possible. JAMES D. SMITH 5

6. Changes resulting from comments on Proposed Rule • Reduced the number of source and supplier categories that must report • Added a mechanism to allow exit from reporting when GHG emissions reduced • Added flexibility in monitoring methods and sampling frequency • Added exemptions for combustion sources • Added thresholds to reduce the burden of determining applicability JAMES D. SMITH 6

7. Summary of Rule Who Reports: Facility/supplier reports directly to EPA (states not directly involved) Facility based reporting for all source categories for which there are methods Limited exceptions for some (e.g. fuel importers, vehicle and engine manufacturers) What gases are covered: carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFC), perfluorocarbons (PFC), and sulfur hexafluoride (SF6), as well as other fluorinated gases (e.g. nitrogen trifluoride and hydrofluorinated ethers [HFEs]). Applicability: Facilities andsuppliers of fossil fuels or industrial greenhouse gases that have: a source in an all-in source category (Table 1) or a source in a threshold source category (Table 2) and emissions ≥ 25,000 tons CO2e per year or a combustion unit included in Table 3 with an aggregate maximum rated heat input capacity ≥ 30 mmBtu/hr and emissions ≥ 25,000. or manufacturers of vehicles and engines JAMES D. SMITH 7

8. Summary of Rule:Source Categories Covered JAMES D. SMITH 8

9. Summary: Source Categories Not Yet Included • EPA plans to further review public comments and other information before deciding on these subparts: • Electronics manufacturing • Ethanol production • Fluorinated GHG production • Food processing • Magnesium production • Oil and natural gas systems • Sulfur hexafluoride (SF6 ) from electrical equipment • Underground coal mines • Industrial landfills • Wastewater treatment • Suppliers of coal • Facilities with these source categories could be covered by the rule based on GHG emissions from stationary fuel combustion sources. JAMES D. SMITH 9

10. Summary of Rule: Critical Dates JAMES D. SMITH 10

11. Global Warming Potential (GWP) or CO2e • Global warming potential (GWP) is a metric used to compare varying heat-trapping ability and atmospheric lifetimes of GHGs. • The GWP of CO2 is 1.0, and the GWP of other GHGs are expressed relative to CO2 • For example, CH4 has a GWP of 21. Each metric ton of CH4 emissions would have 21 times as much impact on global warming (over a 100- year time horizon) as a metric ton of CO2 emissions. • Mass emissions x GWP = CO2 e (metric tons) Table A-1 (p. 56395 of Federal Register) lists GWPs JAMES D. SMITH 11

12. Electricity Generation if report CO2 year-round through Part 75 Adipic Acid Production Aluminum Production Ammonia Manufacturing Cement Production HCFC-22 Production HFC-23 Destruction Processes that are not collocated with a HCFC-22 production facility and that destroy more than 2.14 metric tons of HFC-23 per year Lime Manufacturing Nitric Acid Production Petrochemical Production Petroleum Refineries Phosphoric Acid Production Silicon Carbide Production Soda Ash Production Titanium Dioxide Production Municipal Solid Waste Landfills that generate CH4 equivalent to 25,000 metric tons CO2 e or more per year Manure Management Systems with combined CH4 and N2 O emissions in amounts equivalent to 25,000 metric tons CO2 e or more per year. Table 1: All-in Source Categories JAMES D. SMITH 13

13. Ferroalloy Production Glass Production Hydrogen Production Iron and Steel Production Lead Production Pulp and Paper Manufacturing Zinc Production Table 2: Threshold Source Categories Report if ≥ 25,000 metric tons CO2e per year from all source categories, combustion units, and miscellaneous use of carbonates. JAMES D. SMITH 14

14. Boilers Stationary Internal Combustion Engines Process Heaters Combustion Turbines Incinerators Other Stationary Fuel Combustion Equipment Table 3: Stationary Combustion Units Report if aggregate maximum rated heat input capacity ≥ 30 mmBtu/hr and ≥ 25,000 metric tons CO2e per year from all source categories, combustion units, and miscellaneous use of carbonates. JAMES D. SMITH 15

15. Source Category does not include: Portable Equipment Emergency generators and emergency equipment Irrigation pumps at agricultural operations Flares (unless required by another subpart) Electricity generating units not subject to subpart D Hazardous waste combustors do not report unless: CEMS is used to quantify CO2 or Table C-1 fuel is also combusted (then only report emissions from C-1 fuel) Exclusions JAMES D. SMITH 16

16. Related Issues:Relationship with State Programs This rule does not preempt states from regulating or requiring reporting of greenhouse gases Data collection will not be delegated to state agencies Reporting will be directly to EPA through a web-based data system. EPA is working with states, The Climate Registry and the Exchange Network on a data exchange standard for GHG reporting.

17. Related Issues:Mobile Sources Manufacturers of new vehicles and engines outside of the light-duty sector must provide emissions rate information for greenhouse gases (GHG). It also requires upstream suppliers of petroleum products and coal-based liquid fuels to report. Facilities are not required to report emissions from mobile sources at their operations such as fleets. EPA/NHTSA have proposed a comprehensive light-duty GHG emission control program commencing in model year (MY) 2012. JAMES D. SMITH 18

18. Related Issues:Related Climate Change Action Endangerment Finding (Massachusetts v. EPA) Proposed Tailoring Rule: Would Apply To GHG Under Prevention Of Significant Deterioration (PSD) And Title V Permitting: Reconsideration Of The 12/18/08 Johnson CO2 Memo Geologic Sequestration Rule Proposed Rulemaking: Implications Of Endangerment Finding For Regulating GHG Emissions Cap And Trade Legislation JAMES D. SMITH 19

19. Additional Information EPA’s Regulatory Initiatives On Climate Change: http://www.epa.gov/climatechange/initiatives/index.html GHG Mandatory Reporting Rule Website: http://www.epa.gov/climatechange/emissions/ghgrulemaking.html GHG MRR Training Opportunities: http://www.epa.gov/climatechange/emissions/training.html GHG MRR Overview Presentation: (32 pp) http://www.epa.gov/climatechange/emissions/downloads/FinalMRROverview.pdf GHG MRR Detailed Presentation (74 pp): http://www.epa.gov/climatechange/emissions/downloads09/Webinar_General_Overview.pdf GHG MRR Information Sheets For Source Categories http://www.epa.gov/climatechange/emissions/ghg_infosheets.html GHG MRR Hotline: 1-877-GHG-1188

20. Contact Information Contact Jim Smith: Email: smith.james-d@epa.gov Phone: (215) 814-2197