Over the past week, EPA announced that it would reconsider parts of the “Utility MACT” air toxics regulation on power plants and that it needs even more time to finish it’s reconsidered “Boiler MACT” regulation to get it right. In doing so, EPA implicitly admitted that it moved too fast and underestimated the challenges present in crafting each regulation.

There is a very unsettling common thread in both the Utility MACT and Boiler MACT rules: both regulations were born from litigation, and the deadlines for issuing the regulations came from judicial settlements EPA entered into.

In both cases, EPA agreed to a schedule providing little time to review and respond to comments before entering a final rule. In both cases, the judicially-enforced consent decree EPA entered into prevented the agency from issuing a final rule that was free from errors. And in both cases, EPA now finds itself in the midst of a messy reconsideration process to correct those errors.

These are not isolated events. In fact, EPA recently entered into a consent decree for its PM2.5 National Ambient Air Quality Standards (NAAQS) that gives the agency barely 100 days to review comments, a dramatically shorter time frame than EPA has given for any new or revised PM or Ozone NAAQS since 1971. If the Agency receives 100,000 public comments on the rule—a conservative estimate—EPA staff would have to review over 1,000 comments and draft 4-5 pages of responses per day, every day, including weekends. (continue reading…)

The Environmental Protection Agency (EPA) continues to pile on complex  regulations that impact manufacturers. Just last month, the Agency proposed more stringent air quality standards for fine particulate matter (i.e. PM2.5 NAAQS). Business groups are already starting to speak out. At an EPA public hearing yesterday in Sacramento, CA, the California Manufacturers & Technology Association (CMTA) urged the EPA to maintain the current PM2.5 standards.

“This proposal will unnecessarily burden the economy at a time when the country and California, in particular, are struggling to overcome the recession,” stated Mike Rogge, Policy Director at the CMTA. Rogge’s testimony highlighted the serious and immediate consequences for areas that do not attain the air quality standards established by the EPA. For example, companies building new facilities or performing major modifications to certain existing facilities in, or near, a non-attainment area will be required to install the most effective emission reduction technology regardless of cost. The EPA’s actions will cause many manufacturers around the country to think twice before expanding their operations.

We encourage all manufacturers to urge the EPA to retain the existing PM2.5 standards during the comment period which ends on August 31, 2012. You can learn more about the EPA’s proposal here.

API and ANGA released a study today calling into serious question the methane emissions data EPA has been using for unconventional gas wells.  According to the API/ANGA survey, methane emissions from hydraulic fracturing of unconventional gas wells are, in fact, 50 percent lower than EPA’s estimates.

When is EPA going to correct this flaw?  Today’s study is not even the first time EPA’s hydraulic fracturing emissions data has been contradicted by real-world evidence.  The agency has been sitting on an open Request for Correction under the Information Quality Act (IQA) since December 19, 2011. 

That request (filed by the U.S. Chamber of Commerce, available here) included a survey by URS Corp. of approximately 1200 wells, showing that actual gas emissions from the completion of unconventional shale gas wells were more than 1200% lower than EPA’s gas emission estimate.

A coalition of environmental groups filed a detailed opposition to the IQA correction request, complaining that URS had relied on too small a sample.  Well, today’s API/ANGA survey (also conducted by URS) is of 91,000 wells.  That should be more than enough.

Here’s why this matters: researchers, financial analysts and other governmental bodies are relying on EPA’s flawed estimates of natural gas emissions from unconventional shale gas well completions in a number of research reports and policy consideration. And policymakers are ultimately taking into account these potentially flawed numbers when designing regulations.

Read the API/ANGA study here.

Ross Eisenberg is vice president of energy and resources policy, National Association of Manufacturers.

Today President Obama signed an Executive Order requiring agencies to ask the public for “regulations in need of retrospective review” and semi-annually report to the public and to the Office of Information and Regulatory Affairs (OIRA) on the status of retrospective review efforts. The order also directs agencies, when conducting retrospective reviews, to give priority to initiatives that will significantly reduce costs and burdens imposed on the public. Agencies are also directed to consider the cumulative effects of their regulations and give priority to those reforms that “would make significant progress in reducing those burdens….”

The Executive Order, a follow-up to an earlier order on retrospective review, is aimed at actually reducing the public burden imposed by existing regulations. Manufacturers are encouraged by the requirements placed upon agencies for public participation and for prioritizing review initiatives.

Involving OIRA, the federal government’s regulatory gatekeeper, in the retrospective review process is important. OIRA can hold agencies accountable and help ensure agency efforts result in real reductions of costs and burdens imposed on regulated entities.

The Executive Order’s issuance coincides with the release of a new report on retrospective review by the Council of Economic Advisers. The Council asserts that, with the Executive Order, “the process of retrospective review should become a standard part of the assessment of federal regulations.” (continue reading…)

Today the National Association of Manufacturers joined 153 other organizations in a letter supporting H.R. 2008, the “Keeping Politics Out of Federal Contracting Act of 2011.”  The legislation would preclude the White House from forcing federal agencies to require entities to disclose their political spending – as well as that of their officers and directors – as a condition of participating in the federal procurement process.

The letter was sent to Chairman Darrell Issa (R-CA) and Ranking Member Elijah Cummings (D-MD) of the House Committee on Oversight and Government Reform, which is scheduled to consider H.R. 2008 tomorrow.

The bill is in response to an April 2011 draft Executive Order that would require disclosures of political contributions by select parties as a condition for bidding on federal contracts. The draft order is an attack on the First Amendment and suffers from severe legal and policy defects that would, if signed, immediately damage the federal contracting process.

From the letter:

The legislation reaffirms the principle, currently embodied in federal procurement laws, that the Executive Branch has an obligation to procure goods and services based on the best value for the American taxpayer, and not on political considerations. It also reaffirms the principle that the Administration cannot enact through executive fiat legislation that Congress has considered and explicitly rejected.

The NAM thanks Rep. Issa for his leadership on this issue and urges members of the Committee on Oversight and Government to approve H.R. 2008.

Erik Glavich is director of legal and regulatory policy, National Association of Manufacturers.

The Environmental Protection Agency (EPA) today announced that it would retain the current secondary National Ambient Air Quality Standards (NAAQS) for nitrogen oxides (NOx) and sulfur oxides (SOx). Under the Clean Air Act, secondary standards are established to protect the environment from certain emissions where primary standards are established to protect human health. The EPA noted in its fact sheet on the final rule that the independent Clean Air Scientific Advisory Committee (CASAC) had recommended preserving the current standard based on its review of the available science.

NOx and SOx emissions come from a variety of natural and man-made sources including cars, trucks, buses, power plants, industrial facilities, waste incineration and agricultural sources. The fact sheet also stated that, “since 1980, levels of NOx and SOx in the air have fallen by more than 50 percent and more than 80 percent, respectively.” The resulting decrease has helped mitigate the impact of acid rain or acid deposition on the environment.

We are pleased that the EPA decided to maintain the current standards, but we urge caution as the Agency works to develop a new “multipollutant standard” for NOx and SOx that will also address acid rain deposition. Manufacturers have made great strides to reduce air emissions, and the last thing we need in this tough economy is another overly stringent standard that will do little to improve the environment.

Environmental Protection Agency (EPA) regulations could sharply reduce drilling for natural gas and oil production, according to a new study from the American Petroleum Institute (API). The proposed New Source Performance Standards (NSPS) for oil and natural gas production will impact new hydraulically fractured gas wells and existing gas wells that are “re-fractured.”

According to the API press release, the study found that the proposed regulations would:

• Reduce drilling for natural gas using hydraulic fracturing by up to 52 percent;
• Reduce natural gas production by up to 11 percent; and,
• Reduce oil production by up to 37 percent.

These dramatic reductions in domestic production would result in the federal government losing up to $8.5 billion in royalties and state governments losing up to $2.3 billion in severance taxes.

There is no doubt that the shale gas boom has provided manufacturing operations with a reliable and affordable supply of energy. These proposed EPA regulations, however, threaten to slow fossil fuel production and potentially increase prices as manufacturers are trying to create jobs and boost the nation’s economy. The NAM urges the EPA to ensure these rules allow oil and natural gas producers the appropriate flexibility they need to comply with the regulations in a cost-effective manner.

Alicia Meads is director of energy and resources policy, National Association of Manufacturers.

At the end of 2011 it’s apparent that our economic recovery has been modest at best. A robust economy can be difficult to achieve under even the best circumstances, but it is made even more difficult when faced with a hostile environment for private enterprise. Manufacturers should be freed from unnecessarily burdensome regulations if they are to lead the economy. Efforts to foster economic growth and job creation have been stymied by an avalanche of overregulation from government agencies. A year-end review of the regulatory action taken by government agencies tells a sad story – one that manufacturers hope will reverse itself in the coming year.

This year alone we saw the National Labor Relations Board (NLRB), the Environmental Protection Agency (EPA), the Department of Transportation (DOT), and other agencies place more obstacles in the way of job creation and insert themselves further into the day to day decisions of manufacturers. Here are just a few examples:

2011 was a banner year for overreach for the NLRB, including the ambush elections rule, the decision in the Specialty Healthcare case, and the now-resolved complaint against the Boeing Company. These actions from the board have the potential to create disruptive and adversarial relationships between employers and employees - a result that simply isn’t conducive to growth. The NAM is currently suing the NLRB to prevent the implementation of the poster rule, a rule that has been delayed repeatedly after requests by the judge to allow time for a decision in the case. An NAM survey about the NLRB’s agenda revealed that nearly 70 percent of respondents said the NLRB’s actions will hurt job creation.

The EPA has put forth new rules and regulations that come with high price tags and puts hundreds of thousands of jobs at risk.  The costly and harmful Boiler MACT regulations checks in at $14.5 billion and threatens approximately 230,000 jobs. Sadly, it seems that the EPA may have outdone themselves with the Utility MACT rule – one of the most expensive regulations in EPA history –would have a draconian effect on power plants across the nation. According to the EPA’s own analysis, the Utility MACT regulation could cost more than $100 billion in the coming years and destroy an average of 183,000 jobs per year for the next decade.

The DOT pulled the rug out from under manufacturers that built their logistical operations based on the current trucking hours of service rule and have invested heavily in compliance since their implementation. Released just last week, the revised final rule will have a negative impact on manufacturers’ supply chains, distribution operations and productivity. To change these rules and limit the flexibility of manufacturers without sufficient reasoning is a mistake and will impede the ability of manufacturers to invest, grow and create jobs.

For manufacturers, a year living under the yoke of this overregulation is a year of living dangerously – hopefully Washington will come to its senses before it’s too late.

On Saturday the Senate approved the conference report for H.R. 2055, the final fiscal year 2012 spending measure that will fund the federal government through September 2012. The President is set to sign the bill any time before the expiration on December 23 of a six-day continuing resolution that both houses passed so that necessary steps could be taken to implement the $1 trillion omnibus.

One important provision in the spending measure that has been overlooked is language that prohibits the Interagency Working Group on Food Marketed to Children (IWG) from completing the draft report that proposed alarming guidelines for food marketing unless the IWG “complies with Executive Order 13563.” The executive order affirms the principles of sound regulations and reads:

Our regulatory system must protect public health, welfare, safety, and our environment while promoting economic growth, innovation, competitiveness, and job creation.  It must be based on the best available science.

In its proposal for sweeping guidelines for food marketing, the IWG fails to provide evidence that their recommendations would reduce childhood obesity by any measure. Furthermore, the IWG does not account for the impact of the proposed guidelines, failing to address expected costs or benefits.

According to the President’s edict, the U.S. regulatory system “must take into account benefits and costs, both quantitative and qualitative.” Moreover, the proposed nutrition guidelines conflict with standards set by other federal food programs including USDA’s Women, Infants, and Children program. The President’s executive order explicitly promotes greater coordination across agencies.

The NAM is committed to ensuring the IWG complies with the letter and intent of the legislative language included in H.R. 2055.

The food, beverage and consumer packaged goods industry in the United States employs 14 million workers, generates sales of $2.1 trillion annually and contributes $1 trillion in added value to the economy every year. The IWG’s proposal would hinder economic growth and cost jobs at a time when the economy can least afford it.

Manufacturers applaud the actions of Congress and urge the IWG to comply with the spirit of the law.

Erik Glavich is director of legal and regulatory policy, National Association of Manufacturers.

Today, the Secretary of Energy Advisory Board Subcommittee (SEAB) on Shale Gas Production released its second and final ninety-day report which analyzes the progress that has been made on the recommendations of its previous report, issued on August 18, 2011. The new report criticizes federal agencies, state governments, industry and public interest groups for not moving quickly enough on its recommendations of increased regulation on hydraulic fracturing – a critical technology that allow us to access the nation’s rich shale gas resources.

For example, the SEAB urges more regulatory action on the following areas:

• Air Emissions – Even though the Environmental Protection Agency (EPA) is currently working on regulations that would reduce emissions at hydraulic fracturing sites, the SEAB’s report claims the proposed rules do not go far enough and should be expanded to include more wells.
• Chemical Disclosure – The SEAB wants to see more disclosure of the chemicals used in hydraulic fracturing fluid and believes that there should be an extremely high bar for trade secret protection. The subcommittee quickly discounts current efforts underway including voluntary disclosure websites such as fracfocus.org and the Department of Interior’s (DOI) intent to require the disclosure of fracturing fluid composition on federal lands.
• Water Discharge Standards – The EPA is currently in the process of studying the impact of hydraulic fracturing on drinking water and has also announced a schedule setting waste water discharge standards for some fracturing activities. The SEAB, however, believes that the EPA should not wait until the study is complete to take additional regulatory actions.

The SEAB’s draft report outlines unrealistic expectations and does little to highlight the efforts that industry and regulators have already made to ensure that these activities are conducted safely. It is unreasonable to expect that industry and federal, state and local regulators could institute complex new regulatory programs in three months. Increased access to our nation’s shale gas resources means more affordable energy and more jobs for our nation’s struggling economy. The SEAB’s recommendations to pile on unnecessary and complex regulations could quickly put an end to the nation’s shale gas revolution.