On April 29, 2014, the U.S. House Committee on Energy and Commerce's Subcommittee on Environment and the Economy held a hearing on the revised version of the Chemicals in Commerce Act (CICA2). Details of the hearing provided by the Subcommittee, including its background memorandum, are available online.
Subcommittee Chair John Shimkus (R-IL) issued the original version of CICA in March 2014. CICA2 was released on April 22, 2014. Bergeson & Campbell, P.C.'s (B&C®) detailed summary and analysis of CICA2 is available online. B&C also issued a detailed summary and analysis of the April 29, 2014, Subcommittee hearing, which is available online.
The following witnesses testified at this week's hearing: The Honorable Jim Jones, Assistant Administrator, Office of Chemical Safety and Pollution Prevention, U.S. Environmental Protection Agency (EPA); The Honorable Calvin Dooley, President and Chief Executive Officer, American Chemistry Council; Dr. Beth Bosley, President, Boron Specialties, LLC, on behalf of the Society of Chemical Manufacturers and Affiliates; Mr. Mark Greenwood, Principal, Greenwood Environmental Counsel, PLLC; Dr. Len Sauers, Vice President, Global Sustainability, Proctor & Gamble Company; Mr. Steven Goldberg, Vice President and Associate General Counsel, Regulatory & Government Affairs, BASF; Mr. Andy Igrejas, National Campaign Director, Safer Chemicals, Healthy Families; and The Honorable Michael Moore, on behalf of the National Conference of State Legislatures.
As discussed in more detail in the B&C summary, the hearing was very partisan. Shimkus defended his revised draft of CICA2 and argued that it attempts to address concerns raised by the Democrats on the Subcommittee. Subcommittee Democrats, including Ranking Member Paul Tonko (D-NY), argued that the revised bill fails to address their concerns. Jones asserted that CICA2 would need to be strengthened in certain areas to ensure necessary protection against harmful chemicals. For instance, he stressed the need for Toxic Substances Control Act (TSCA) reform legislation to include Administration principles on TSCA reform established in 2009. As explained in B&C's analysis, Jones also "claimed in his written testimony that CICA2 'does not include a mechanism that would provide for the timely review of existing chemicals that may pose a concern.' He also stated that 'y including a standard very similar to the current TSCA Section 6 authorities, the draft bill fails to address another key element of meaningful chemical safety reform' and also criticized CICA2 for including a consideration of costs or the availability of substitutes in risk management."
Given the continued partisan nature of the TSCA reform debate, particularly within the House of Representatives, prospects for enactment of reform in this shortened election year appear to be slim.
The White House Office of Management and Budget (OMB) has reportedly received the final rule on "RFS Pathways II and Technical Amendments to the RFS2 Standards" (RFS Pathways II rule) from EPA. This is the last step in the process before EPA publishes the final rule. EPA's summary of its proposed RFS Pathways II rule is available online. A copy of the 38-page proposed rule, which was published in the Federal Register on June 14, 2013, is also available online.
The Biobased and Renewable Products Advocacy Group (BRAG™) reported on and summarized the proposed RFS Pathways II rule when it was published last year. A copy of that report is available online.
EPA has stated publically that it expects to issue its final rule setting the 2014 RFS in June 2014. As that date nears, lobbying activity on both sides has intensified. For instance, on April 30, 2014, the American Petroleum Institute released a letter claiming that "ask[ing] EPA to build in an adequate margin of safety when setting the final ethanol mandates for 2014 because projections of gasoline demand often miss the mark." A copy of the letter is available online. On April 29, 2014, Representatives Tim Walz (D-MN), Rick Nolan (D-MN), and Cheri Bustos (D-IL) -- three Democratic Members of the House of Representatives from corn-producing Midwestern states -- met with senior White House officials to argue that the final 2014 RFS rule should not include the deep cuts proposed to the corn ethanol and advanced biofuel volumetric targets. A copy of Representative Walz's press release on the meeting is available online.
On April 29, 2014, in a 6-2 ruling, the U.S. Supreme Court upheld EPA's view in EPA v. EME Homer City Generation L.P., U.S. Nos. 12-1182 and 12-1183. The opinion is available online.
The decision reverses a 2012 ruling by the U.S. Court of Appeals for the District of Columbia Circuit, holding that EPA's Cross-State Air Pollution Rule (CSAPR) exceeded EPA's authority to regulate greenhouse gas emissions under the Clean Air Act (CAA). The CSAPR -- issued under the Obama Administration and which strengthened a similar rule issued in 2005 by the Bush Administration -- requires 28 upwind states to reduce power plant emissions to help downwind states achieve national ambient air quality standards (NAAQS).
The Supreme Court held that the EPA permissibly created the CSAPR, in part considering cost effectiveness. As such, it is within EPA's authority under the CAA to include within CSAPR its "Good Neighbor" provision requiring upwind states to help downwind states meet NAAQS and imposition of federal implementation plans (FIP) "after EPA has quantified the state's interstate pollution obligation." More information on the case and the Supreme Court's holding is available online.
The BIO World Congress on Industrial Biotechnology, being held May 12-15, 2014, in Philadelphia, Pennsylvania, is the world's largest industrial biotechnology event for business leaders, investors, and policy makers in biofuels, biobased products, and renewable chemicals. BRAG and B&C will present a practical workshop to fully inform, equip, and assist renewable chemical producers in finding the path of least resistance on the road to commercialization.
"Commercializing Renewable Chemicals and Biobased Products: The Importance of Successfully and Efficiently Navigating the Regulatory Process"
Tuesday, May 13, 2014, 2:30 p.m. - 4:00 p.m.
Moderator: Lynn Bergeson, B&C
David Widawsky, Director - Economics, Exposure, and Technology Division, Office of Pollution Prevention and Toxics (OPPT), EPA, Manager of the Presidential Green Chemistry Challenge Awards
Tracy Williamson, Chief, Industrial Chemistry Branch, OPPT, EPA
Frank Pacholec, VP R&D/Corporate Sustainability Officer, Stepan Company
Nancy Clark, DuPont Industrial Biosciences
* Overview of the 90-day EPA new chemical notification review process
* Filling out the premanufacture notification (PMN) form -- Top Ten Mistakes and How to Avoid Them
* Challenges posed by chemical identity/nomenclature under U.S. and European Union (EU) law
* Leveraging successfully pollution prevention benefits
For information and to register click here.
BRAG will present "Regulatory Landscape & Implications for Innovation," Thursday, June 19, 2014, at the 18th Annual Green Chemistry & Engineering Conference hosted by the American Chemical Society's Green Chemistry Institute.
Speakers and topics include:
Lynn L. Bergeson
American Chemistry Council
"State chemical management initiatives: Green chemistry? Or, something else?"
3E Company Department of Regulatory Research
"REACHing Asia in a green chemistry environment: Initiative, implementation and impact"
Elevance Renewable Sciences
Center for Environmental Health
"Moving California towards flame retardant-free furniture and baby products"
For information and to register click here.
On April 22, 2014, the U.S. Environmental Protection Agency (EPA) signed off on a Direct Final Rule requiring petroleum refiners and importers to blend 810,185 gallons of cellulosic fuels into the fuel supply in 2013 in response to petitions for reconsideration of the Final Rule from the American Petroleum Institute (API) and the American Fuel & Petrochemical Manufacturers (AFPM). The pre-publication version of the Direct Final Rule is available online. Petitioners successfully argued that cellulosic fuel production was well below EPA's projections. Previously, EPA had mandated that the petroleum industry blend six million gallons of cellulosic fuels into the fuel supply under the Renewable Fuel Standard (RFS) for 2013. EPA granted the motion for reconsideration because one of the two companies that EPA expected to produce cellulosic biofuel in 2013 announced shortly after EPA signed the final rule that it intended to produce significantly lower volumes of cellulosic biofuel in 2013 that it had reported to EPA. The rule will be effective 60 days after it is published in the Federal Register.
Oral argument was heard on April 7, 2014, on a joint motion filed in the U.S. Court of Appeals for the D.C. Circuit by EPA, API, and AFPM to sever certain issues and hold them in abeyance pending administrative reconsideration. Monroe Energy LLC et al. v. EPA, D.C. Cir., No. 13-1265. According to the Respondent-Intervenors Biotechnology Industry Organization (BIO), Growth Energy, and Renewable Fuels Association (RFA) in their April 16, 2014, response opposing EPA's motion, severing the case serves no purpose. EPA requested that the API and AFPM petitions be pulled out of the case and held in abeyance arguing that these petitions challenged EPA's decision to use revised fuel production and consumption estimates in the 2013 final RFS and to add a small refinery exemption. They argued that these matters should be held in abeyance while EPA addresses other aspects of the 2013 RFS. The renewable fuel groups countered that no purpose would be served as the case has already been argued and it is too late to sever these issues.
EPA Presidential Green Chemistry Challenge Awards promote the environmental and economic benefits of developing and using novel green chemistry. These prestigious annual awards recognize chemical technologies that incorporate the principles of green chemistry into chemical design, manufacture, and use. Biobased and Renewable Products Advocacy Group (BRAG™) member Elevance Renewable Sciences was a Presidential Green Chemistry Award Winner in 2012. While applications for 2014 are due on April 30, 2014, it is not too soon to begin thinking and preparing for a 2015 submission. EPA's Office of Chemical Safety and Pollution Prevention (OCSPP) sponsors the Presidential Green Chemistry Challenge Awards in partnership with the American Chemical Society (ACS) Green Chemistry Institute® and other members of the chemical community, including industry, trade associations, academic institutions, and other government agencies.
Throughout the 18 years of the awards program, EPA has presented awards to 93 winners. Since its inception in 1996 through 2012, EPA has received 1,490 nominations. By recognizing groundbreaking scientific solutions to real-world environmental problems, the Presidential Green Chemistry Challenge has significantly reduced the hazards associated with designing, manufacturing, and using chemicals.
According to EPA, through 2013, 93 winning technologies have made billions of pounds of green chemistry progress, including:
* 826 million pounds of hazardous chemicals and solvents eliminated each year -- enough to fill almost 3,800 railroad tank cars or a train nearly 47 miles long.
* 21 billion gallons of water saved each year -- the amount used by 820,000 people annually.
* 7.8 billion pounds of carbon dioxide equivalents released to air eliminated each year -- equal to taking 810,000 automobiles off the road.
More information is available online.
The Organization for Economic Cooperation and Development (OECD) recently released its document "OECD Guidance for Characterising Oleochemical Substances for Assessment Purposes," which is available online. The document seeks to present a "harmonised approach" for characterizing UVCB (substances of unknown or variable composition, complex reaction products or biological materials) oleochemical substances that are derivatives from animal and vegetable oils and fats.
In June 2012, the OECD Task Force on Hazard Assessment endorsed a pilot project to develop guidance on identifying UVCB using oleochemicals/oleoproducts as the pilot chemicals. The development of this guidance was, in part, in response to questions and concerns related to UVCB nomenclature that had been raised by the European Chemicals Agency (ECHA) in response to some UVCB chemical registrations under the Registration, Evaluation, Authorization and Restriction of Chemicals (REACH) regulation.
Industry stakeholders, including U.S. chemical manufacturers, have expressed concern that if adopted under current regulatory regimes, the newly released OECD nomenclature guidance will require companies to obtain new chemical names for materials that they have used for many years. This, in turn, could trigger the need for new chemical review under EPA's Toxic Substances Control Act (TSCA).
All stakeholders within the biobased chemical space -- even those not directly engaged in oleo-based products -- should carefully review the existing guidance and monitor future OECD work in this arena as it will have widespread ramifications. OECD has already indicated that it will focus on biofuels in upcoming UVCB nomenclature guidance, a development that will have significant implications for the biochemical industry.
EPA is vigorously questioning results of a U.S. Department of Energy (DOE)-funded study that concludes ethanol produced from crop residues such as corn stover can have higher lifecycle greenhouse gas (GHG) emissions than conventional gasoline, arguing that the findings are based on an "extremely unlikely scenario" of unsubstantiated agricultural practices. RFA is also highly critical of the new study, claiming its "methodology is fundamentally flawed and its conclusions are highly suspect." RFA made available a useful fact sheet that is available online.
The DOE-funded study was published on April 20, 2014, in Nature Climate Change. The study claims to demonstrate that ethanol produced from corn stover and other crop residues does not meet EPA's criteria for achieving a 60 percent GHG emission reduction compared to gasoline in order for the fuels to qualify under the RFS. The study could raise questions over EPA's ability to raise the cellulosic target in the final version of the 2014 RFS, especially if the fuel's GHGs disqualify them under the program.
EPA is also refuting the study as hypothetical, and lacking a firm basis in current agriculture practices. An EPA spokeswoman reportedly stated the "paper is based on a hypothetical assumption that 100 percent of corn stover in a field is harvested; an extremely unlikely scenario that is inconsistent with recommended agricultural practices." More information is available online.
A newly released analysis on the global chemical industry is predicting strong growth for the biobased sector. Consistent with findings released recently from Lux Research and RnR Market Research, Frost & Sullivan's analysis from "Scorecard for the Global Chemicals Industry" reports that the share of biobased chemicals is expected to grow to about 15 to 18 percent of global chemical sales by 2025. As new feedstock supplies and greener processes begin to shape the new chemicals ecosystem, chemical manufacturers are focused on various strategies such as the development of integrated value chains, innovation and technology management, and chemical recycling to name a few, to ensure growth and sustainability.
Awards recognizing innovative applications and markets in the European biobased chemicals and materials industry were handed out at the 7th International Conference on Biobased Materials in Cologne, Germany, on April 10, 2014. First prize went to Qmilch Deutschland GmbH (DE) for Qmilk, a biopolymer fiber made from milk protein. The full list of winners is available online.
The Environmental Law Institute's (ELI) May/June 2014 issue of ELI Forum features articles from five notable experts representing government, industry, and policy viewpoints on the issue of TSCA reform. Titled "TSCA Redux: Rejuvenating a Timeworn Statute," the publication includes Lynn L. Bergeson, Managing Partner of B&C; Richard A. Denison, Lead Senior Scientist, Environmental Defense Fund; Kathy Kinsey, Deputy Secretary for Regulatory Programs and Operations, Maryland Department of the Environment; Ann R. Klee, Vice President, Environment, Health & Safety, General Electric; Representative John Shimkus (R-IL), Chair of the House Energy and Commerce's Subcommittee on Environment and the Economy; and Senator Tom Udall, Chair, Senate Subcommittee on Superfund, Toxics, and Environmental Health. More information is available at www.eli.org.
On April 22, 2014, Shimkus, Chair of the Subcommittee on Environment and the Economy, announced that the Subcommittee on Environment and the Economy will hold a hearing on April 29, 2014, to review a revised draft of the Chemicals in Commerce Act (CICA). According to Shimkus, the revised draft "reflects suggestions from members on both sides of the aisle, as well as stakeholders and the administration." CICA would reform TSCA. More information regarding the hearing, as well as both the revised draft CICA and a redline comparison to the March 2014 discussion draft, is available online. Memoranda regarding TSCA reform legislation and hearings held to date are available online. B&C's detailed discussion of revisions to the draft CICA is available online.
On April 15, 2014, the U.S. Department of Energy (DOE) announced that it would provide up to $10 million to promote the production of "advanced biofuels, substitutes for petroleum-based feedstocks, and bioproducts made from renewable, non-food-based biomass, such as agricultural residues and woody biomass." For more information, and to apply for this opportunity, please visit DOE's Funding Opportunity Exchange website. A copy of the press release is available online.