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

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

November 9, 2009 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, 2009Federal Register Takes Effect December 29, 2009 JAMES D. SMITH 3

November 9, 2009 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

November 9, 2009 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

November 9, 2009 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

November 9, 2009 JAMES D. SMITH 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 and suppliers 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 CO 2 e 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

November 9, 2009 JAMES D. SMITH 8 Summary of Rule: Source Categories Covered SectorReporters Electricity GenerationPower plants TransportationVehicle and Engine ManufacturersVehicle and Engine Manufacturers (vehicle fleets not covered) Industrial All large industrial emitters, including those in the following industries: MetalsIron and SteelIron and Steel, Aluminum, Ferroalloy, Zinc, and LeadAluminumFerroalloyZincLead MineralsCementCement, Lime, Glass, Silicon Carbide, Pulp and PaperLimeGlassSilicon CarbidePulp and Paper Chemicals HCFC-22, Ammonia, Nitric Acid, Adipic Acid, Hydrogen, Petrochemicals, Petroleum Refineries, Soda Ash, Phosphoric Acid, Titanium DioxideAmmoniaNitric AcidAdipic AcidHydrogen PetrochemicalsPetroleum RefineriesSoda AshPhosphoric AcidTitanium Dioxide AgricultureManure Management Other Large Stationary Combustion UnitsLarge Stationary Combustion Units, Municipal solid waste landfillsMunicipal solid waste landfills Upstream Suppliers* Carbon DioxideCarbon Dioxide, Coal-based Liquids, Industrial Gases, Natural Gas and Natural Gas Liquids, Petroleum ProductsCoal-based LiquidsIndustrial GasesNatural Gas and Natural Gas LiquidsPetroleum Products

November 9, 2009 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

November 9, 2009 Summary of Rule: Critical Dates 1/1/2010 Start collecting data. Best available monitoring methods allowed 1/28/2010 Submit request to extend use of best available monitoring methods 3/1/2010Utilize required monitoring methods 12/31/2010Complete 2010 data collection 1/30/2011Submit certificate of representation 3/31/2011Submit GHG report for /31/XXXXSubmit annual reports in future years JAMES D. SMITH 10

November 9, 2009 Global Warming Potential (GWP) or CO 2 e 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-1Table A-1 (p of Federal Register) lists GWPs JAMES D. SMITH 11

November 9, 2009 Table A-1 (p of Federal Register) JAMES D. SMITH 12

November 9, 2009 Table 1: All-in Source Categories Electricity Generation if report CO2 year-round through Part 75Electricity 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 yearMunicipal 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.Manure Management Systems with combined CH4 and N2 O emissions in amounts equivalent to 25,000 metric tons CO2 e or more per year JAMES D. SMITH 13

November 9, 2009 Table 2: Threshold Source Categories Ferroalloy Production Glass Production Hydrogen Production Iron and Steel ProductionIron and Steel Production Lead Production Pulp and Paper ManufacturingPulp and Paper Manufacturing Zinc Production Report if ≥ 25,000 metric tons CO 2 e per year from all source categories, combustion units, and miscellaneous use of carbonates. JAMES D. SMITH 14

November 9, 2009 Table 3: Stationary Combustion UnitsStationary Combustion Units Boilers Stationary Internal Combustion Engines Process Heaters Combustion Turbines Incinerators Other Stationary Fuel Combustion Equipment Report if aggregate maximum rated heat input capacity ≥ 30 mmBtu/hr and ≥ 25,000 metric tons CO 2 e per year from all source categories, combustion units, and miscellaneous use of carbonates. JAMES D. SMITH 15

November 9, 2009 Exclusions 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 CO 2 or –Table C-1 fuel is also combusted (then only report emissions from C-1 fuel) JAMES D. SMITH 16

November 9, 2009 JAMES D. SMITH 17 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.

November 9, 2009 JAMES D. SMITH 18 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.EPA/NHTSA have proposed a comprehensive light-duty GHG emission control program

November 9, 2009 JAMES D. SMITH 19 Related Issues: Related Climate Change Action Related Climate Change Action Endangerment Finding (Massachusetts v. EPA) Proposed Tailoring Rule: Would Apply To GHG Under Prevention Of Significant Deterioration (PSD) And Title VProposed Tailoring Rule: Would Apply To GHG Under Prevention Of Significant Deterioration (PSD) And Title V Permitting: Reconsideration Of The 12/18/08 Johnson CO2 MemoPermitting: Reconsideration Of The 12/18/08 Johnson CO2 Memo Geologic Sequestration Rule Proposed Rulemaking: Implications Of Endangerment Finding For Regulating GHG EmissionsProposed Rulemaking: Implications Of Endangerment Finding For Regulating GHG Emissions Cap And Trade Legislation

November 9, 2009 JAMES D. SMITH 20 Additional Information EPA’s Regulatory Initiatives On Climate Change: – GHG Mandatory Reporting Rule Website: – GHG MRR Training Opportunities: – GHG MRR Overview Presentation: (32 pp) – ew.pdfhttp:// ew.pdf GHG MRR Detailed Presentation (74 pp): – eral_Overview.pdfhttp:// eral_Overview.pdf GHG MRR Information Sheets For Source Categories – GHG MRR Hotline: GHG-1188

November 9, 2009 JAMES D. SMITH 21 Contact Information Contact Jim Smith: –Phone:(215)