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Energy News Network: Michigan PURPA Rulings a ‘Mixed Bag’ for Independent Power Producers

Michigan PURPA Rulings a ‘Mixed Bag’ for Independent Power Producers

By Andy Balaskovitz

Independent power producers say recent rulings by Michigan regulators provide short-term development opportunities but also more uncertainty in the coming years as they negotiate contracts with a major utility.

On October 5, the Michigan Public Service Commission issued multiple orders related to the prices Consumers Energy pays to independent producers under federal Public Utility Regulatory Policies Act (PURPA) contracts.

One ruling allows for up to 150 megawatts worth of projects to qualify for PURPA contracts at rates that advocates say are more favorable for developers. The rates had been on hold for months as regulators settled questions around avoided costs and contract terms. Avoided costs are the rates paid by law to independent producers based on the price of the utility building the generation itself.

However, it’s unclear how long those terms will stay in place or how much opportunity there will be in the future. In the coming months, the MPSC may allow Consumers to restructure those rates and contract terms in ways that developers say would stifle PURPA contracts. While the most recent rulings apply to Consumers, DTE Energy’s avoided costs are also under consideration.

Clean energy advocates and independent power producers have been closely following the cases for more than two years as PURPA rules could determine the level of third-party solar development in the state. The debate over PURPA and solar development has played out in multiple states in recent years.

Margrethe Kearney, staff attorney with the Environmental Law and Policy Center, which intervened in Consumers’ rate cases, said the rulings effectively delay certainty over PURPA contracts by pushing them into Consumers’ IRP, which won’t be finalized for another six months.

“That undercurrent is a troubling,” Kearney said. “Do we really want a commission that isn’t making timely decisions and bouncing issues from one contested case to another?”
If the MPSC doesn’t agree with Consumers’ proposed avoided costs and contract terms, the company still has the ability to withdraw its IRP, while granting the utility’s request could harm developers, Kearney said.

“They’ve suggested that if any part of their plan is not approved, they could pull the whole thing,” Kearney said. “The change in the contract terms would strike a huge blow to independent power producers.”

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Joint Statement Regarding North Dakota PSC Dismissal of Case Against Meridian Energy Group

FOR IMMEDIATE RELEASE:

Sarah Eddy, 312-795-3710

Scott Skokos, 701-224-8587

Joint Statement Regarding PSC Dismissal of Case Against Meridian Energy Group

Bismarck, ND—In a decision today, the North Dakota Public Service Commission (PSC) dismissed the complaint of the Dakota Resource Council and the Environmental Law and Policy Center against Meridian Energy Group, jeopardizing the PSC’s regulatory jurisdiction in the process.

This decision ignores the clear statutory and constitutional mandate for the PSC to act as an independent regulator of North Dakota’s utilities. The PSC’s siting laws are the bedrock of sensible utility siting in North Dakota, including not just for oil refineries, but also for wind, solar, electric transmission, power plants, and pipelines.

Rather than considering the case on its merits, the PSC today chose to dismiss this case without even granting a hearing, concluding that the PSC lacks any authority whatsoever to determine through formal proceedings whether Meridian needs a siting permit to construct a major oil refinery. The PSC chose to rely on an affidavit of Meridian’s CEO to conclude that the company does not need a permit. In other words, the PSC has taken the position that if a company states that it does not need a permit, then the PSC will trust the company at its word. The PSC’s decision ignores its duty as an independent utility regulator and the rights of North Dakotans to seek formal determinations from the PSC. This is a pivotal decision that could broadly affect the PSC’s ability to regulate everything from electric rates, to coal mines, to wind siting, and oil refinery siting, and it should concern all North Dakotans.

The Dakota Resource Council and Environmental Law and Policy Center are conferring with their legal counsel and reviewing next steps, including a review of this decision in district court.

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Affordable Clean Energy Rule Hearing Testimony

Testimony of Howard A. Learner,
Executive Director, Environmental Law & Policy Center

On the United States Environmental Protection Agency’s Proposed Rule:
Emission Guidelines for Greenhouse Gas Emissions from Existing Electric Utility Generating Units; Revisions to Emission Guideline Implementing Regulations; Revisions to New Source Review Program, called Affordable Clean Energy Rule. 83 Fed. Reg. 44,746

The Midwest produces more electricity from coal plants than any other region of the country, and our residents bear the full range of pollution harms to human health, the Great Lakes and our overall environmental quality.

EPA’s proposed new ACE will reverse United States’ efforts to cut carbon pollution and will allow more old coal plants to keep polluting our air and water. The 2015 Clean Power Plan established the first federal standards to reduce carbon pollution from existing coal plants. The Clean Power Plan can help drive the United States’ economy toward modern renewable energy and energy efficiency technologies that improve public health, and boost clean energy jobs in the Midwest and elsewhere. The EPA’s new proposal undermines smart climate change solutions and a growing clean energy economy future.

America’s Heartland is well positioned to lead us forward by delivering climate change solutions powered by wind power and solar energy and maximizing energy efficiency in ways that are good for Midwest jobs and economic growth. Last week, ELPC released our new report: Indiana Wind Power & Solar Energy Supply Chain Businesses: Good for Manufacturing Jobs, Good for Economic Growth and Good for Our Environment. This report highlights 89 Indiana businesses engaged in the clean energy business supply chain at 112 locations across Indiana. Policies drive markets. ELPC’s report explains in detail how Indiana should step up its policy support to compete effectively in the growing clean energy economy. You can download the ELPC report here. This report adds to ELPC’s other Midwest state reports detailing clean energy jobs.

Midwest wind power and solar energy development are good for business growth and the environment together. Renewable energy development creates many thousands of skilled manufacturing and construction jobs, and development, design and professional services jobs.

The EPA’s proposed ACE plan, however, would move our nation backwards and cost American jobs. This morning, I will make three specific points about this flawed proposal:

First, EPA’s proposed ACE is legally flawed. EPA’s proposal is contrary to any reasonable interpretation of “best system of emissions reduction” and does not fulfill the Agency’s responsibilities under the Clean Air Act to reduce harmful air pollution.

EPA’s proposal would replace the Clean Power Plan’s reasonable and achievable goal of reducing carbon pollution from the power sector by 32% with a flawed policy that instead sets no such pollution limits. The Clean Power Plan carries out the Clean Air Act’s requirement to protect public health that is endangered by carbon pollution. It provides states with clear standards and flexible tools to reduce carbon pollution. The ACE plan, however, does not.

EPA’s ACE proposal provides an incomplete menu of technologies that nominally improve the heat rate of coal plants, but provides states the option of requiring nothing at all from power plants. The ACE proposal imposes no deadlines for implementing control measures to the extent that any are required. This proposal is inconsistent with the Clean Air Act, and it abandons EPA’s responsibility to take effective actions to reduce carbon pollution from power plants, which has been found by sound science to endanger public health.

Second, the proposed ACE rule will encourage more investment in old, inefficient coal plants that should be winding down. If states require one or more improvements from the “menu,” which plant owners are not now making, that will lead to greater dispatch of these coal plants and will disrupt the market trends away from old coal plants towards new, clean energy production. EPA should not cause any industry to be more polluting, but its own analysis shows that the proposed ACE rule would do exactly that.

Third, the New Source Review changes proposed in the ACE rule are a giveaway to owners of old coal plants with no acknowledgement of who will pay the bill. EPA provides anecdotes to support its claim that coal plant owners have supposedly decided to not improve plant operating efficiency because they would need to get an air permit and might be required to install modern air pollution controls as many other coal plant owners have already done. This should not justify excusing coal plant owners from new source review requirements. The only time this change matters is when a source is actually going to increase its emissions of air pollution by a significant amount.

EPA’s own analysis shows that this proposal puts the health and safety of families and communities at risk from increased pollution. If the ACE proposal is adopted and finalized, by EPA’s own calculations that could lead to as many as 1,630 early deaths per year in 2030 compared to leaving the Clean Power Plan in place.

ELPC will be submitting additional written comments to the docket. This proposal to replace the Clean Power Plan undermines EPA’s core mission of protecting the public and our environment from harmful air pollution under the Clean Air Act. It should be withdrawn.

It’s time for America to move forward not backwards with clean energy solutions to our climate change problems. Thank you for your consideration.

MinnPost: Why a Clean Water Rule May – Or May Not – Be a Big Issue in Minnesota’s First Congressional District

Why a Clean Water Rule May – Or May Not – Be a Big Issue in Minnesota’s First Congressional District

By Walker Orenstein

As farmers in southern Minnesota grapple with President Donald Trump’s escalating trade war — testing the alliance between the agriculture industry and the GOP that substantially benefited Trump in 2016 —  First Congressional District Republican candidate Jim Hagedorn is making sure to showcase the administration’s industry-friendly policies as part of his effort to persuade voters to send him to Congress.

That means highlighting support for mining in northern Minnesota, including the recent decision to end a study of potential impact from copper-nickel mining on the Superior National Forest and the neighboring Boundary Waters Canoe Area Wilderness.

But it also includes touting a Trump administration effort that hits much closer to home in southern Minnesota: the rollback of a 2015 update to the Clean Water Act that expanded protections to small bodies of water feeding larger rivers and lakes — a policy that happened to be one of President Barack Obama’s signature environmental initiatives.

“It’s one of the biggest regulatory issues in agriculture,” Hagedorn said. “I bring it up all the time.”

A fight over water protections

The Obama EPA’s 2015 rule change has a long backstory. It starts more than 40 years ago, when Congress first approved the Clean Water Act. That original bill gave the federal government jurisdiction over the “waters of the United States.”

Ever since, people have not stopped arguing what that actually means, and how broad the government’s authority is under the law. Does it apply only to  lakes and rivers and water that feeds directly into them? Or does the law cover even small wetlands, bogs, streams and other isolated or seasonal bits of water?

Supreme Court rulings on the matter have never quite cleared things up, so under Obama, the EPA stepped in to make firm — and far-reaching — guidelines on what could be considered a Water of the United States. John Kolb, a St. Cloud-based attorney who focuses on water and natural resources regulations, says a long study conducted by the EPA used to justify its rule boiled down to: “All water is connected.”

Many farmers took issue with the decision, however. Beyond their general opposition to government expansion, industry groups said the rule change meant they were going to be targeted and penalized for standard agricultural practices. Kirby Hettver, president of the Minnesota Corn Growers Association, said farmers out West were found in violation of Obama-era Clean Water Act “just for tilling their soil.”

He was referring to a case that began in 2012 in which the government ordered a farmer in Northern California, John Duarte, to pay millions in fines and penalties after it said he broke the law by “deep ripping” his field to plant wheat without a permit, and disturbing seasonal wetlands called vernal pools that are notably home to fairy shrimp. (While there are plenty of agricultural exemptions to the Clean Water Act, the government said the field wasn’t subject to them since it hadn’t been plowed in decades. The case was eventually settled.)

While Duarte’s legal saga started before Obama’s update to the Clean Water Act, it became a rallying cry for conservatives worried about government overreach, a charge that found a sympathetic reception within the Trump administration. Earlier this year, the EPA withdrew the rule and is now in the process of writing a more narrow definition of which waters are protected under the Clean Water Act.

Effect in Minnesota

And yet, whether any of this means much for Minnesota remains a topic of debate. One reason is that despite the Trump EPA’s withdrawal of Obama’s Waters of the United States rule, litigation has reinstituted the Obama rule in more than 20 states, including Minnesota.

For another, Minnesota administers much of the Clean Water Act for itself, and it adopted its own stringent definition of protected waters decades ago, said Jean Coleman, an attorney for the Minnesota Pollution Control Agency. In fact, Minnesota’s rule is far broader than the Obama-era water rule, and includes everything from irrigation and drainage systems to all “accumulations of water, surface or underground, natural or artificial, public or private,” within the state, she said.

“The definition of ‘Waters of the State’ is extremely expansive and it captures all waters that would be under the Obama definition of ‘Waters of the U.S.’ or under any other definition of ‘Waters of the U.S.’ because it is so expansive,” Coleman said.

She added: “I don’t think you can think of anything that’s liquid water that falls from the sky that’s not a water of the state.”

The state also has its own tough laws protecting wetlands and more, said Scott Strand, senior attorney for the Environmental Law and Policy Center, a nonprofit environmental advocacy group. Those laws blunt any given update or reversal of the federal Waters of the United States rule. “It will have a more dramatic impact in states that don’t have vigorous state clean water protections,” Strand said of the changes to the Waters of the United States rule.

 

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Crain’s Chicago Business: Michigan Offers to Pay Millions for Illinois Asian Carp Project, but Rauner Balks

 

Michigan Offers to Pay Millions for Illinois Project, but Rauner Balks

Greg Hinz On Politics

It’s an unusual plan: A neighbor state would pick up most of the tab for efforts to keep Asian carp out of the Great Lakes. What’s keeping Rauner from signing up?

States nowadays have trouble paying for the stuff within their borders that’s important, much less offering to pick up the tab for a project in another state. And when they do, you’d think the recipient would say yes.

But not Illinois Gov. Bruce Rauner. Though the state of Michigan is offering to pony up millions of dollars a year to pay the costs of operating new Asian carp-blocking locks along the Illinois River at Brandon Road near Joliet—with seven other states and the Canadian province of Ontario chipping in, too—Rauner is not saying yes, at least so far.

The usual offer to pay costs for a project located in Illinois comes from outgoing Michigan Gov. Rick Snyder—like Rauner, a Republican.

In a phone interview yesterday, Snyder strongly pushed a “fair share” plan in which Illinois would pay just $132,700 a year of the estimated $8 million needed to operate the Brandon facility. Michigan itself would pay $3.3 million a year, based on its share of the total Great Lakes coastline, and legislative leaders in that state are committed to pay that amount for at least five years, more than $16 million total.

“We’re interested in (protecting) the Great Lakes,” which scientists say could suffer enormous losses to native fish if the voracious carp make it that far, Snyder said. “Why wouldn’t Illinois be excited about sharing project costs?”

Snyder said that regular discussions have been occurring for months among officials from the various states and provinces, including Wisconsin, New York, Ohio, Minnesota, Pennsylvania and Indiana. Now, it’s time to act, he said.

“We’d just as soon quit dating and get married,” Snyder quipped. “We’d like to get an agreement with Illinois.”

Michigan is so interested that it will pick up any other state’s portion of the bill if they can’t pay it themselves, he said.

Rauner, in an interview after he appeared before the Crain’s editorial board yesterday, indicated some interest. But he didn’t offer to sign up, either.

“The idea certainly has merit. We’ve been talking to (Snyder) about it,” Rauner said. But “we’re not committed to it.”

Rauner declined to elaborate, but there has been considerable back and forth lately about who will pay for construction costs that could hit $200 million or more.

Since I last wrote about this in May, the Rauner administration has dropped its request to double the width of locks to 1,200 feet to help the barge industry. Officials say barge needs can be accommodated in other locations.

In addition, Congress is in the final stages of passing legislation that directs the Army Corps of Engineers to finalize its Brandon Road study and put a specific proposal on the table by early next year. The legislation also would require the feds to pay at least 80 percent of construction costs.

That still would leave Illinois with a capital bill, but according to local environmental leader Howard Learner of the Environmental Law & Policy Center, other states are willing to pick up part of the construction costs, too.

“Rauner needs to find a way to say yes,” Learner said.

Snyder’s comments came as Michigan released results of a public opinion poll that indicate 80 percent of Great Lakes residents want action soon on the Brandon Road proposal.

READ COLUMN HERE

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Lakeshore Public Radio: State Policies Making Indiana Clean Energy Businesses Less Competitive

September 25, 2018
Reports: State Policies Making Indiana Clean Energy Businesses Less Competitive
by Rebecca Thiele

 

Nearly 90 companies in Indiana play some role in renewable energy projects, which bring jobs to the state. But these businesses can’t be as successful without the policies to support them, according to a new report by the Environmental Law & Policy Center.

The ELPC says lately Indiana hasn’t been creating a good business environment for renewable energy. The state opted to phase out net metering last year and eliminated statewide energy efficiency standards in 2014. Chris Rohaly is the president of Green Alternatives Inc., a small solar installation company in Kokomo.

“I’m bidding against companies out of Ohio or Illinois and they — because of the strength of their home markets — are pretty well funded,” he says.

ELPC Clean Energy Business Specialist Tamara Dzubay co-authored the report. She says the Bureau of Labor Statistics projects two renewable energy jobs will grow substantially in the next eight years — but without the right policies, Indiana could miss out on the opportunity.

“Solar energy installation and wind turbine technician jobs cannot be outsourced, so many jobs are there to stay,” Dzubay says.

Among other things, the ELPC suggested developing a statewide energy plan and making it mandatory for utilities to get half of their energy from renewables by 2030.

LISTEN TO RADIO CLIP

NEW ELPC REPORT: Indiana Clean Energy Business Supply Chain Report Finds 89 Companies, Good for Hoosier Economy, Good for Environment

FOR IMMEDIATE RELEASE

ELPC REPORT:  89 Indiana Clean Energy Businesses –

Good for Indiana’s Economy and Environment Together

 

INDIANAPOLIS – A report released today by the Environmental Law & Policy Center (ELPC) highlights 89 Indiana companies engaging in accelerating wind power and solar energy as manufacturers, developers, designers, contractors, installers and professional and other services, These companies are employing more than 10,000 Hoosiers across the state.

“Indiana wind power and solar energy development are good for business growth and the environment together,” said Howard Learner, Executive Director of ELPC. “Renewable energy development creates manufacturing jobs, including for the tower cables and wires to the protective covers that shield blades from harsh weather, for skilled workers in places like Bremen and Elkhart, and for Indiana construction workers doing the installations.”

The report identified that clean energy supply chain companies are widespread. Wind power and solar energy businesses are located in all 9 congressional districts, in 40 of the 50 state senate districts, and in 56 of the 100 state house districts.

However, Indiana has recently taken major backward steps on its clean energy policies, such as eliminating retail net metering by July 2022 for distributed solar energy generation, and ending its mandatory energy efficiency resource standard that created jobs and saved people money on their utility bills.

“The report demonstrates that Indiana changed course and is moving its clean energy initiatives in the wrong direction,” said Learner. “State leaders must take strong targeted policy actions for Indiana to regain momentum and advance clean energy growth that will lower Hoosiers’ utility bills and reduce carbon pollution.”

Additional groups that participated in ELPC’s report included Citizen Action Coalition of Indiana, Hoosier Environmental Council, Indiana Distributed Energy Alliance and others. The report calls for Indiana to adopt new policies to support accelerated growth of renewables and energy efficiency to remain competitive in the growing clean energy economy. Some of those policies, addressed in the report, should include:

  • setting strong clean energy targets by adopting a mandatory renewable energy standard
  • developing a stronger Integrated Resource Planning Process (IRP);
  • providing stronger tools for clean energy financing by reinstating net metering;
  • enacting a Property Assessed Clean Energy (PACE) program;
  • requiring utilities to comply with the Public Utility Regulatory Policies Act (PURPA)

“Energy is an important part of the infrastructure that businesses look to when deciding where to open up shop,” said Janet McCabe, Senior Law Fellow at ELPC, former US EPA Acting Assistant Administrator for the Office of Air and Radiation, and assistant director for policy and implementation at Indiana University’s Environmental Resilience Institute. “We know many businesses have embraced sustainability and placed a priority on renewable energy. Indiana has the companies and workforce to bring more solar powered businesses here and to develop more wind energy across the state using parts manufactured by Hoosiers.”

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News-Press Now: Energy Efficiency, Spending Headed for Big Drop

September, 23 2018
Energy Efficiency, Spending Headed for Big Drop
by Erin Murphy

DES MOINES — Proposed energy efficiency plans offered by Iowa utility companies would be a shell of what they had been in recent years.

The new and scaled-back energy efficiency plans are a result of legislation passed this spring and signed into law by Gov. Kim Reynolds. The new law caps the percentage of a customer’s utility bill that can be put toward energy efficiency programs.

Iowa’s utility companies this summer detailed to the state’s regulatory board new 5-year energy efficiency plans starting with 2019. Some of the proposals show a dramatic reduction in energy efficiency program spending and energy savings.

The utility companies say the new plans will result in lower bills for customers, which they can use to invest in energy efficiency if and in any way they choose, and that advancements in technology have rendered some programs unnecessary.

Critics say it is just as they warned during debate over the legislation: that it would gut the state’s energy efficiency programs, and that customers will pay more in the long run.

The state board must act on the proposals by March 31.

“It’s a huge cut and we’re really disappointed,” said Kerri Johannsen, energy program director with the Iowa Environmental Council, a nonpartisan coalition of organizations dedicated to preserving Iowa’s environment.

“The Iowa Environmental Council has a vision of 100 percent renewable energy for the state of Iowa, and we think that that goal is entirely achievable. But we need a wide variety of resources to get there,” Johannsen said. “We just think (the new law and new energy efficiency plans are) a deviation from the path that Iowa has been on toward a really clean energy grid.”

MidAmerican Energy, the Des Moines-based utility company that serves more than 750,000 customers in Iowa, Illinois, Nebraska and South Dakota, in 2018 spent nearly $80 million on electric energy efficiency programs and nearly $31 million on gas energy efficiency programs.

Under their new proposal, MidAmerican in 2019 would spend less than $43 million on electric energy efficiency programs, a cut nearly in half, and just more than $6 million on gas energy efficiency programs, a drop by more than 85 percent.

MidAmerican’s energy savings would drop as well: their gas efficiency plan would save 80 percent less than 2017 and their electricity plan will save nearly 50 percent less, according to calculations made by the Iowa Environmental Council. Spokespeople for the utilities did not dispute the figures.

“Utilities have had really robust energy efficiency programs for many years in Iowa. Since 2009 alone the programs have saved the equivalent of building two-and-a-half baseload power plants,” Johannsen said. “The customers pay for the energy efficiency programs, but they’re paying less (overall). They haven’t had to pay for that generation.”

Johannsen said on the new trajectory under the utilities’ reduced energy efficiency plans, Iowans could have to pay more in the long run because less energy efficiency will lead to a need for more energy production to meet customers’ needs.

“Load growth in Iowa has been pretty flat for a number of years. Electric demand just hasn’t grown because of our efficiency programs,” Johannsen said. “So what we’re going to see is, without doing efficiency we’re going to see load growth and utilities will be forced to invest in new (power) generation.”

Josh Mandelbaum, an attorney with the Environmental Law and Policy Center, said the reduced programs also could threaten the jobs of more than 20,000 Iowans working in energy efficiency-related jobs across the state.

“In the past, Iowa has been a clean energy leader with strong energy efficiency plans, but this is a major step backward,” Mandelbaum said in a statement.

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Energywire: BLM’s Final Methane Rule Reveal Draws Swift Legal Action

BLM’s Final Methane Rule Reveal Draws Swift Legal Action

by Pamela King

The states of California and New Mexico yesterday opened a new courtroom battle over Obama-era methane standards, hours after the Interior Department closed the book on its long effort to scale back the rule.

Bureau of Land Management officials yesterday revealed the language of its revisions to the 2016 Methane and Waste Prevention Rule.

“Sadly, the flawed 2016 rule was a radical assertion of legal authority that stood in stark contrast to the long-standing understanding of Interior’s own lawyers,” said Interior Deputy Secretary David Bernhardt. “The Trump administration is committed to innovative regulatory improvement and environmental stewardship, while appropriately respecting the clear and distinct authorities of the states, tribes, as well as the direction we receive from Congress.”

The New Mexico and California attorneys general promptly sued Interior.

“With this attempt to axe the Waste Prevention Rule, the Trump administration risks the air our children breathe and at taxpayers’ expense,” said California Attorney General Xavier Becerra. “We’ve sued the administration before over the illegal delay and suspension of this rule and will continue doing everything in our power to hold them accountable to our people and planet.”

In their lawsuit, filed in the U.S. District Court for the Northern District of California, the states contend that BLM under President Trump has violated multiple statutes in its unrelenting efforts to wipe the rule from the books.

The revised rule is a “shocking abdication” of the department’s responsibilities, said David Hayes, former Interior deputy secretary in the Clinton and Obama administrations.

“The final rule fails to forthrightly address the environmental and fiscal significance of the issue to federal and state authorities, the relatively minor costs of compliance, and the major climate- and health-related environmental benefits associated with commonsense restrictions on venting and flaring activities,” said Hayes, who now serves as executive director of the State Energy & Environmental Impact Center at the New York University School of Law.

BLM yesterday found that its revision would result in maximum total net benefits of roughly $1.08 billion over a decade. That benefit is rooted in reduced compliance costs for oil and gas operators.

“As environmental stewards and businessmen and women who live in the communities where they work, IPAA member companies strive to explore for and produce as much American oil and natural gas as possible, while always being mindful of the need to protect public lands and the environment,” said Barry Russell, president and CEO of the Independent Petroleum Association of America. “The Trump administration’s rule recognizes this fact and acknowledges the cost burden placed on companies that work and explore on federal lands.”

The cost-benefit analysis for the revision rule applies a sharp discount on the social cost of emitting methane, a potent greenhouse gas, into the atmosphere.

“The administration is turning its back on commonsense methane reduction standards that reduce wasteful energy flaring and protect the public from harmful smog-forming pollution,” said Howard Learner, executive director of the Environmental Law & Policy Center. “The current standards call for the use of known technologies and good industry practices to reduce wasteful methane leaks. The new rule would allow more flaring of methane gas — a valuable natural resource.”

Allowing companies to release more natural gas into the atmosphere instead of capturing it for sale will result in at least $28.3 million in forgone royalty payments to taxpayers, BLM estimated.

“Today’s final methane rule makes it painfully obvious that this administration is placing industry interests ahead of federal taxpayers,” Ryan Alexander, president of Taxpayers for Common Sense, said in a statement yesterday. Interior Secretary Ryan Zinke “has chosen to dismiss the problem of leaked, vented or flared gas from drilling operations on federal lands, costing taxpayers millions in lost revenue.”

Industry groups applauded the changes.

“We are relieved that BLM’s final rule has been released and that it actually addresses waste prevention,” said Kathleen Sgamma, president of the Western Energy Alliance. “The late 2016 Obama administration rule was all about regulating air quality, which is the job of EPA and the states under the Clean Air Act, not BLM, which has no air quality expertise or authority. The new regulation restores the rule of law while reducing waste of natural gas, which was supposed to be the intent of the original rule in the first place.”

BLM’s rule follows EPA’s efforts last week to relax its New Source Performance Standards for new and modified oil and gas sources (see related story).

Royal Dutch Shell PLC followed EPA’s announcement with a move to reduce methane leaks from its oil and gas operations (Energywire, Sept. 18).

Instead of viewing industry’s efforts as a reason to cut back regulations, government officials should see those actions as indicators of industry’s appetite to address their climate contributions, environmental groups said. Consistent federal regulations would require smaller operators to follow larger firms’ lead, they said.

“When even the world’s largest oil companies recognize the need for methane safeguards, reasonable people cannot pretend that the Trump administration is rolling them back in the public’s interest they purport to serve,” said Earthworks policy director Lauren Pagel.

Capitol Hill

BLM’s announcement yesterday drew mixed reaction from Capitol Hill lawmakers.

Republicans in Congress last year pushed to unwind the Obama regulation under the Congressional Review Act, which requires a simple majority in the House and the Senate to support a resolution to disapprove a rule.

Although the House and Senate were under GOP control, the proposal fell short of the support it needed in the upper chamber (Greenwire, May 10, 2017).

Sen. Maria Cantwell (D-Wash.) called on Interior to follow Congress’ lead.

“Even though Congress has already rejected an attack on the Obama-era methane rule, Secretary Zinke has ignored congressional intent and moved forward with this ill-advised scheme anyway,” she said. “If this new rule is implemented, companies will be able to waste millions of dollars in taxpayer resources by releasing 180,000 tons of methane pollution per year into our air.”

House Natural Resources Chairman Rob Bishop (R-Utah) said he was glad to see Interior find its own way to scrap the rule.

“Today’s announcement fulfills the promise made by the Trump administration to remove regulatory hurdles on domestic energy production,” he said in a statement yesterday. “The previous rule was founded on questionable legal theory and resulted in unnecessary costs.”

Sen. Tom Udall (D-N.M.) said the revision rule ignores the years of public input that went into the creation of the original rule.

“The methane rule was established with wide support after years of open dialogue and stakeholder involvement. And the evidence is clear: This rule has had no negative effect on job creation or on the booming U.S. oil and gas production on federal lands,” he said. “That’s why the methane rule was upheld by a bipartisan vote in the United States Senate — despite heavy lobbying from some in the oil and gas industry.”

Sen. Michael Bennet (D-Colo.) this year led a request that Interior officials hold public meetings on the BLM rule changes, as they did in the lead-up to the Obama regulation (Energywire, April 18, 2017).

“I’m disappointed to learn that BLM did not listen to the people of our state and went ahead with this rollback even after the Senate rejected it,” Bennet said yesterday. “Today’s decision only has downsides for the people of Colorado. It will lead to more pollution, waste more natural gas and decrease revenue for taxpayers.

“Worst of all, it will put the health of our communities at risk.”

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BLM’s Misguided Rule Weakens Methane Flaring Reduction Standards that Avoid Waste and Protect Public Health and Our Environment

FOR IMMEDIATE RELEASE

Contact: Judith Nemes

Bureau of Land Management’s Misguided Rule Weakens Methane Flaring Reduction Standards that Avoid Waste and Protect Public Health and Our Environment  

Statement by Howard A. Learner

In response to the Trump Administration’s rollback of the existing Methane Waste Reduction Standards avoid waste from oil and gas drilling on public and tribal lands in North Dakota and across the country, Environmental Law & Policy Center Executive Director Howard Learner said:

“The Administration is turning its back on common sense methane reduction standards that reduce wasteful energy flaring and protect the public from harmful smog-forming pollution. The current standards call for the use of known technologies and good industry practices to reduce wasteful methane leaks. The new rule would allow more flaring of methane gas—a valuable natural resource. Flaring harms human health, wastes energy resources and costs Americans $1 billion in wasted energy and pollution.

“In North Dakota this rollback will mean more wasted natural gas, less money for impacted communities, and more air pollution from oil and gas drilling on public lands.

“The Bureau of Land Management is ignoring the strong support from more than half a million Americans who favored the existing Methane Waste Reduction Standards and oppose its repeal. The Trump Administration apparently doesn’t care enough about wasting energy, protecting public health or collecting fair revenues from the oil and gas industry drilling on our public lands,” Learner said.

Click Here to read the full rule. 

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