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Natural gas, electronics groups sue EPA over emission-reporting rules

New federal regulations that require companies to disclose their greenhouse gas emissions have drawn several new lawsuits from electronics companies and the natural gas industry, which argue that there are flaws in the way U.S. EPA designed the program.

Trade groups such as the American Gas Association and the Semiconductor Industry Association, as well as the manufacturing giant 3M Co. and natural gas producer Chesapeake Energy Corp., want the agency to rethink various elements of the reporting rules that were finalized at the beginning of December. In total, seven groups filed petitions in federal court before yesterday's deadline for legal challenges.

The requirements, ordered by Congress to help policymakers and the public understand where the nation's greenhouse gas emissions originate, are separate from the controversial EPA regulations that are meant to curb greenhouse gases from cars, light-duty trucks and industrial facilities. But the newest spate of petitions, filed Friday and Monday, shows there are still some lingering disagreements about the best way to get a handle on the nation's emissions inventory.

Oil and gas groups are challenging the new requirements for drilling, production and processing facilities, while electronics groups want EPA to rethink the rules for users of fluorinated greenhouse gases.

Most other industries are required to submit their first reports to EPA in less than two months, but the rules for these two sectors were delayed for a year after the agency decided it needed more time to craft the requirements.

Oil and gas facilities and users of fluorinated greenhouse gases were required to begin keeping data on Jan. 1. Their first annual reports to EPA are due in March of next year (E&ENews PM, Nov. 9).

The program has gotten tentative support from trade groups such as the American Petroleum Institute, which filed a petition yesterday asking EPA to reshape its rules. Oil and gas companies want a "single, harmonized national GHG emissions reporting program," the petition says, but that program needs to offer the "clarity, lead time and flexibility necessary to achieve compliance without unreasonably disrupting regulated industry."

Most of the concerns raised by API and other trade groups, such as the Interstate Natural Gas Association of America, focus on technical concerns and the deadlines for companies that must provide reports to EPA. Their petitions say EPA hasn't given companies enough time to decide whether they will need to request the use of "best available monitoring methods" as a substitute for the methods that were otherwise ordered by the agency.

The reporting rules have been closely watched by advocacy groups, which understand that the data could have an impact on future efforts to address climate change by regulating greenhouse gases. Environmentalists in particular have pegged the reports from the oil and gas sector as key to the success of the program.

Program at center of gas flap

The importance of emissions data was highlighted last month by a report that suggested the natural gas sector could have higher emissions than previously thought.

While power plants running on natural gas release about half the greenhouse gas emissions of coal-fired plants, that advantage could shrink to 25 percent or less when methane emissions from the entire process of gas production are taken into account, ProPublica reported based on its analysis of new data from EPA (Greenwire, Jan. 25).

The figures came from a technical support document that was released along with the new reporting rules.

That document included figures on the release of methane, a greenhouse gas that can escape from leaky valves and pipelines. It is 21 times more potent than the carbon dioxide that leaves the smokestack of a power plant.

In recent years, as hydraulic fracturing has opened up new shale gas reserves in the United States, many energy experts have hailed natural gas as a possible "bridge fuel" for a transition away from the use of coal.

Among environmental groups, the analysis by ProPublica raised some eyebrows about emissions from the natural gas sector, said Nathan Willcox, director of Environment America's federal global warming program.

"We need to flush out exactly how much pollution is coming from where in the energy sector," he said. "At the end of the day, we still know that the largest polluters are going to be the coal-fired power plants, but beyond that, to gain a complete picture of exactly where the emissions are coming from, that's where these reports are going to be very useful."

The article's claims were also challenged by Energy in Depth, a trade group for the oil and gas industry. Claiming that oil and gas producers have cut methane emissions in recent years, the group pointed to a statement from EPA, which said that it hadn't conducted a life-cycle analysis itself.

"EPA has not reviewed the analysis described in the article in detail, but we have not seen any indication that the benefits of natural gas have been called into question," agency spokeswoman Erin Birgfeld said in the statement cited by Energy in Depth. "Available data demonstrate that switching from another fossil fuel to natural gas reduces emissions of carbon pollution and other harmful pollutants that threaten Americans' health."

Beyond this debate, the flap shed light on the key role of the greenhouse gas reporting program, Willcox said. Even in the absence of a price on carbon, new emissions data for the energy sector could make a source of energy more or less attractive than another, he said.

The only company to file its own challenge to the new requirements for the oil and gas industry was Oklahoma City-based Chesapeake, which has become the nation's second-largest producer of natural gas by focusing on shale plays and other unconventional natural gas reserves.

A company spokesman said he could not respond to questions by deadline.

Concerns from electronics industry

There were two petitions filed seeking review of the reporting rules for users of fluorinated greenhouse gases.

Though they are released in relatively small amounts, these highly potent chemicals can be thousands of times more efficient than carbon dioxide at trapping heat in the atmosphere. They are mainly used for complex industrial processes, such as aluminum production and the manufacturing of semiconductors.

Brian Toohey, president of the Semiconductor Industry Association, said his group supports the idea of requiring companies to report their greenhouse gas emissions, but the methods that EPA has chosen are too expensive.

"We stand ready to work constructively with the EPA to develop a revised rule that achieves our shared environmental goals in a more balanced, cost-effective and less burdensome manner," Toohey said.

The rules were also challenged by 3M, a manufacturing company that produces fluorinated gases as a coolant liquid for electronics.

Similar sources of greenhouse gases were excluded from the reporting rules, the company's petition says. That could cause users of 3M's products to flock to competing coolants to avoid having to report their greenhouse gas emissions to EPA, the company says.

"There are issues with the rules in terms of potential underreporting of greenhouse gases," 3M spokesman Bill Nelson said in an interview. At stake is an "underlying issue of fairness," he added.

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