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Greenhouse Gasses - Greenhouse Gas Update

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					    Florida Department of
    Environmental Protection




        Greenhouse Gas Update
      2010 Jacksonville Environmental Symposium:
             Green City Gateway to Florida



Joseph Kahn
Division of Air Resource Management
July 16, 2010
Climate Activities – State and Federal
Brief look at:
• Recent state actions by DEP
   • Rules
   • Technical analyses
• Federal policy proposals
• Federal actions & regulations by EPA




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Florida's Clean Car Rule
• Florida DEP successfully adopted GHG rules,
  February 2009
  • Fleet average GHG for light duty cars and trucks
  • Same GHG standards as California, as per CAA
  • Savings vs. (old) federal rules, cumulative by 2020:
     • 22.6 million metric tons (MMT) CO2E
     • 2.54 billion gallons of gasoline
  • Effective after two milestones:
     • EPA approval of California standards (July 2009)
     • Ratification by Florida Legislature (has not yet happened)


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Florida's Clean Car Rule
• Part of the national debate
   • Florida: ~6% of US population, ~9% new car sales
   • Florida joined a dozen other states in adopting CA
• Road to the new federal fuel economy rules
   • May 2009 agreement (Obama, manufacturers, CA)
   • May 2010 new joint NHTSA/EPA rules
• Federal rules now recognized as equivalent to CA
   • Start the process of repealing the Florida rule
   • Required by Environmental Regulation Commission

                                                          4
Florida's Idling Reduction Rule
• Heavy-duty trucks (semis, tractor trailers, etc.)
   •   Idling for more than 5 min is prohibited
   •   Saves fuel; reduces GHG and other pollutants
   •   Some idling allowed (traffic, emergency, bus AC)
   •   Alternatives (APU, truck-stop infrastructure)
• Assistance to truckers
   • Compliance (no penalties for first time offenders)
   • Fact-sheets and outreach activities
   • APU rebate program (Oct 2009 to Mar 2010)
        • Provided $82,500 to truckers to purchase 55 APU
                                                            5
Florida’s Emission Inventory
• Preliminary inventory of Florida GHG emissions
  to help guide planning efforts in the state
   • Last update published September 2007
• EPA’s State Inventory Tool
   • 14 industrial sectors
• Covers emissions from 1990 to 2004
• Total 2004 GHG emissions of 289 MMTCO2E
• Available at:
  www.dep.state.fl.us/air/about_air/climate.htm

                                                   6
Florida's Cap-and-Trade Rule for Utilities
• Preparing Florida for national program
   • Identifying issues important to Florida & consensus
     where it exists
   • Laying groundwork for future federal rules
   • Economic analysis of impacts of regulatory options
• Evaluating offset procedures
   • Key to early success of cap-and-trade
   • Methodologies and verification are critical
   • Projects of interest in Florida – forestry, landfill gas

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DEP’s Comparative Study of Offset Protocols
• Greenhouse gas offset projects
   • Sequestration or reduction at non-capped sources
   • Protocols account for amount of GHG to credit
      • Many studies of offset programs and policies
      • Few studies of technical design elements of the protocols
        (calculations, recordkeeping, monitoring frequency)

• DEP study
   • 15 offset project types (afforestation, landfill gas)
   • 11 offset programs (Climate Action Reserve, RGGI)
   • Comments welcome on the draft, available here:
     www.dep.state.fl.us/air/rules/ghg/electric/offsets.htm
                                                                    8
DACS Woody Biomass Economic Study
• Analysis and report to the Legislature March 1, 2010
• Department of Agriculture and Consumer Services with DEP
    • Contract with UF’s School of Forest Resources and Conservation, and
      Food and Resource Economics Department
• 15.9 million acres of timberland in Florida
   • 10.1 million in private ownership
• A 7% RPS (equivalent of 1% to 3% electricity production
  from wood sources over time) would be:
    • Feasible without much disruption of timber supply to existing
      forest products industry
    • Economically beneficial to the economy of the state, and
      especially to timber producers and forestry in general
        www.fl-dof.com/forest_management/woody_biomass.html
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Federal Policy Proposals – Considerations
•   White House vs. Congress (Senate) on “pricing carbon”
•   Tax vs. cap-and-trade – what industries to include
•   Cap and milestones – how quickly to tighten caps
•   Allowance allocation method – free or auction, coal vs. gas,
    new vs. existing
•   Allowance price controls
•   Offsets – limited, U.S. vs. international, project types, existing or new
•   Electricity rate increase protection – concessions on other air pollutants?
•   Auction revenue – projects, low income households, R&D, treasury
•   Block action by EPA and states?
•   Stand alone or part of energy bill
     •   Carbon capture and storage
     •   RPS or “RES”
     •   Nuclear
     •   Biofuels and biomass
     •   Energy efficiency
                                                                                  10
Congressional Climate Policy Proposals
Key Bills – House (passed) and Senate (moving targets)

Waxman-Markey bill (June 2009)               Kerry-Lieberman bill (May 2010)
3% below 2005 levels by 2012                 4.75 percent below 2005 levels by 2013
17% below by 2020                            20% below by 2020
42% below by 2030                            Same
83% below by 2050                            Same
REPS of 20% by 2020                          Cap-and-trade for utilities, manufacturers
Allowance allocation through 2025            Allowance allocation through 2025
35% of allowances to utility sector          Additional allowances in first 3 years
Pre-emption of state programs through 2017   Pre-emption of state and regional programs
Prohibition against using CAA for GHGs       Prohibition against using CAA for GHGs
Passed House on June 26, 2009                Incentives for new nuclear
                                             Not yet considered by the Senate
                                             New proposal for utility only (July 2010)

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Congressional Climate Policy Proposals
Key Bills – Senate (more moving targets)


Lugar Energy bill (June 2010)                Carper bill (February 2010)
Vehicle, building energy eff. stds.          Multi-pollutant, NOx, SO2 and Hg
coal unit retirements, new nuclear           Possible link to CO2
No caps or cap-and-trade
                                             Unnamed Energy & Climate bill (Reid)
Rockefeller bill (February 2010)             Utility-only cap and trade, opt in for others?
Imposes two year delay in EPA                May include pre-emption of EPA regulations
regulation of GHGs                           Kerry, Snowe, Lieberman, Bingaman, more


Murkowski Resolution (June 2010)             Rockefeller-Voinovich bill (July 2010)
Disapprove EPA endangerment finding          Promote CCS; merge with energy bill?
Senate vote June 10 – did not pass (47-53)

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EPA Findings
• April 2007 – Mass. vs. EPA (motor vehicles)
  • Supreme Court ruled that GHGs are pollutants under
    Clean Air Act
  • EPA must determine whether science supports
    endangerment finding
• December 2009 – EPA publishes final “endangerment”
  & “cause or contribute” findings
  • GHG concentrations pose a danger to public health
    and welfare & motor vehicle emissions contribute to
    GHG pollution
  • Range of potential GHG regulations under CAA
  • Petitions for reconsideration

                                                      13
EPA’s Regulations Light-duty Vehicles
• GHG emissions from new light-duty vehicles
  • Light-duty vehicles are responsible for about 60
    percent of U.S. transportation GHG emissions
  • May 2010 joint NHTSA/EPA rules
  • First harmonized GHG and fuel economy
    standards, MY 2012 to 2016
     • New CAFE rules about the same as the CA rules
     • Equivalent to fleetwide average of 35.5 mpg by MY 2016




                                                                14
What’s Next for EPA’s Vehicle Regulations?
• Light-duty cars and trucks for MY 2017 to 2025
• Heavy-duty (commercial) vehicles (MY 2014+)
• Promotion of cleaner fuels, including biofuels
  (with DOT)
   • Renewable Fuels Standard (RFS) program
• Advanced vehicle technologies (with DOE)




                                                   15
EPA Reporting Rule
• Effective December 2009, for stationary sources
• Collect accurate and timely emissions data to
  inform future policy decisions
• Annual reports to EPA
   • Suppliers of fossil fuels or industrial greenhouse gases
   • Manufacturers of vehicles and engines
   • Facilities that emit 25,000 metric tons or more per year
     of GHG emissions
• CY 2010 reports due in 2011
                                                                16
EPA Tailoring Rule
• Published May 2010
• Regulation of vehicles under CAA triggers PSD/TV
  permitting for GHGs for stationary sources
   •   EPA’s legal basis is “doctrine of absurd results”

• “Tailoring” (increasing) emissions threshold for GHGs
   • 75,000 – 100,000 tons/year CO2E
   • Statutory threshold is 100 or 250 tons
   • Step 1: January 2, 2011 sources subject to PSD (75,000 TPY)
   • Step 2: July 1, 2011 new projects for PSD (100,000 TPY),
     modifications (75,000), existing for TV (100,000)
   • Step 3: Smaller sources after April 30, 2016
• Challenges pending
                                                                   17
Federal Regulations – Requirements
• Best Available Control Technology (BACT)
   • New and modified units under PSD
   • What is BACT for CO2?
      • Efficiency (unit or facility?)
      • Fuel type? (natural gas vs. coal or oil)
      • Design of unit? (IGCC vs. boiler)
   • CAAAC technical teams
      • Considering BACT, data, possible NSPS

• Probable FIP for Florida – permitting for GHGs by
  EPA Region 4 starting January 2, 2011

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More Information?
• DEP’s Division of Air Resource Management :
  www.dep.state.fl.us/air
• EPA: www.epa.gov/climatechange/
• Feel free to contact me at
  joseph.kahn@dep.state.fl.us or
  850-488-0114
• Or contact Julie Ferris, Climate Policy
  Coordinator, at julie.ferris@dep.state.fl.us or
  850-488-0114

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