Most of the nation's largest sources of greenhouse gases must start disclosing their total emissions next year, but U.S. EPA may wait another three years before it makes businesses provide the potentially sensitive information that is used to size up a facility's carbon footprint, the agency said today.
With the first batch of annual emissions reports due in March, the handling of input data was one of the thorniest questions remaining. While environmental groups had urged EPA to make all of the information available to the public, industry groups and the Federal Trade Commission raised concerns that releasing information about business practices could give certain companies a competitive advantage or lead to price fixing in the marketplace.
This summer, EPA decided that key inputs such as fuel type and consumption should count as "emissions data," which must be made public even if the agency decides that it gives away secrets about a company's business practices. But under a draft rule that was released today, companies would not need to give EPA those data for the first three years of the program.
In that window, companies could ask EPA to keep their information private, the proposal says. Unless they get an exemption, the companies would need to start providing input data with their 2013 reports, which would be due on March 31, 2014.
"Many commenters wrote that certain inputs to emission equations ... are considered trade secrets or otherwise sensitive business information and that making these inputs publicly available would cause serious competitive harm," the agency said today in a fact sheet explaining the proposal. "EPA reviewed these comments and has concluded that some of the concerns warrant more extensive evaluation of the potential effects of making certain inputs to emission equations publicly available."
Brian Freeman, an environmental attorney at Robinson & Cole LLP who has closely followed the design of the reporting program, said EPA's proposal seems sensible, considering that the greenhouse gas reporting program is breaking new ground for the agency and industry alike.
Even without the underlying data, the information provided by businesses will help the public compare the emissions from various industry sectors and specific facilities, he said.
"The bottom line is: What are they emitting?" Freeman said. "That's the focus here."
The reporting program, which was ordered by Congress in 2007, was EPA's first foray into the regulation of greenhouse gases. Most industry sectors in the program were told to begin gathering data on Jan. 1, 2010, with other sectors, such as the oil and gas industry, required to follow suit at the start of 2011.
Today's proposal was welcomed by businesses, some of which had asked for more time to comply with the rules. Khary Cauthen, director of federal relations at the American Petroleum Institute, said the industry is happy that there will be another chance to comment on the possibility that trade secrets would be compromised.
"It looks like EPA wants to get this right, as do we," Cauthen said.
When it came to potentially sensitive information, EPA found itself in a legal bind once it decided that the inputs were "emissions data," experts say. Because the Clean Air Act requires that all emissions data be made public -- sensitive or not -- the agency would not be allowed to gather the data and then withhold it from the public.
Environmental groups, which have urged EPA to make the emissions input data public, were quiet today in their response to the announcement.
"It's our view that this data is emissions data and should be ultimately made available to the public," said David Doniger, policy director of the Natural Resources Defense Council's climate center, in an interview. "It's critical to have the data with which to check the accuracy of the emissions numbers, because otherwise you're just getting a number without any means of verification."
Click here for more information on EPA's proposal.