Letter to the Honorable Lisa Jackson, Administrator, United States Environmental Protection Agency

Letter

EPA Responds to Senator's Push to Recognize Role of Biomass in Job Creation

Montana's senior U.S. Senator Max Baucus applauded a rule change announced today that will create certainty for Montana's biomass industry, paving the way to new jobs in the energy sector.

Earlier this month, Baucus wrote a letter to the Environmental Protection Agency asking that it move quickly to address its approach to regulating greenhouse gas emissions from biomass facilities, expressing concern that the rules would "stymie growth in the biomass industry, putting U.S. jobs at risk."

In response, the EPA announced plans today to exclude biomass emissions from Clean Air Act regulation for the next 3 years.

"Folks in Montana have a lot of great ideas to build our clean energy economy and create good paying jobs for the future. But, the tailoring rule created too much uncertainty standing in the way of moving forward. I'm pleased to see the EPA respond to our request to fix these regulations for biomass so we can create more jobs in Montana's timber and energy industries."

Baucus' effort and the EPA response are being hailed by folks across Montana.

"This is great news for our regional economy, the forest industry, and the potential role for biomass in our nation's renewable energy future," said Joe Unterreiner, Kalispell Chamber President. "The EPA recognizes that woody biomass is an important resource that we could and should be developing and has acknowledged the need to step back and take a closer look at the science."

Stoltze Land & Lumber in Columbia Falls says today's decision by the EPA is a step in the right direction.

"We are very appreciative of the efforts by Senator Baucus' to work with the EPA on this issue, as it will also help maintain our forest health, retain our industry infrastructure, and promote jobs in Montana," said Chuck Roady, F.H. Stoltze Land & Lumber Company Vice President.

"Plum Creek is very pleased that the Environmental Protection Agency has taken these important steps on an issue that is critical to our company and the forest products industry," said Tom Ray, Columbia Falls-based vice president, Northwest Resources and Manufacturing. "We expect this decision will create the type of certainty that other companies need in order to proceed with development of their production facilities here in Montana. This in turn, will help ensure forest health and have a positive effect on jobs and the economy here in Montana and across the country."

In 2010, Baucus championed legislation to clarify the definition of renewable biomass to maximize economic opportunities for biomass produced from Montana's private and Federal lands. Baucus says he will keep fighting make sure biomass combustion continues to be a part of the state's clean energy economy future.

Baucus' letter to the EPA follows below:

January 4, 2011

Lisa Jackson
Administrator
Environmental Protection Agency
1200 Pennsylvania Avenue NW
Washington, DC, 20060

Dear Administrator Jackson:

We are writing to ask that you expedite consideration of how biomass emissions will be accounted for under your Agency's regulation of greenhouse gases pursuant to the Clean Air Act. As you know, the answer to this question is critical to the future of the role that biomass will play in our nation's renewable energy future and to the potential for biomass to boost economic growth in our states.

Biomass combustion is expected to be a key tool for building the clean energy economy and reducing greenhouse gas emissions, particularly in rural areas, as we move forward in our nation's efforts to diversify our energy feedstocks. In Oregon and Montana, the use of biomass products in energy applications will create jobs and stimulate economic development. As you know, we are very concerned that the Agency's treatment of biomass in the tailoring rule may inadvertently stymie growth in the biomass industry, putting U.S. jobs at risk in the coming months and preventing greenhouse gas emissions reductions that would otherwise be achieved.

While the regulation of biomass emissions as greenhouse gases under the Clean Air Act has created significant uncertainty in the biomass energy market, your Agency has acknowledged the benefits of biomass energy. In the preamble to the final tailoring rule, the Agency commented:

"We are mindful of the role that biomass or biogenic fuels and feedstocks could play in reducing anthropogenic GHG emissions, and we do not dispute the commenters' observations that many state, federal, and international rules and policies treat biogenic and fossil sources of C02 emissions differently."

In the November 10 "PSD and Title V Permitting Guidance For Greenhouse Gases", commonly known as the "Best Available Control Technology (BACT) guidance," the Agency noted:

"... a variety of federal and state policies have recognized that some types of biomass can be part of a national strategy to reduce dependence on fossil fuels and to reduce emissions of GHGs .... permitting authorities might determine that, with respect to the biomass component of a facility's fuel stream, certain types of biomass by themselves are BACT for GHGs. "

The Agency also explained that it intends to issue more detailed guidance in January 2011 that will provide a suggested framework for evaluating BACT for biomass facilities and that the Agency will decide before May 2011 whether it would issue another rule to establish different accounting rules for biomass, potentially excluding biomass completely from the PSD and Title V requirements.

We are concerned that the proposed delay will further exacerbate uncertainty in the biomass industry and inhibit growth, particularly because in the meantime, the Agency will issue further guidance for industry on how to comply with regulatory requirements, the scope or applicability of which could be reduced or eliminated by the later rulemaking.

We urge you to move quickly to re-address the means by which biomass is evaluated under the tailoring rule. The Agency has collected ample information as a result of its Call for Information on which it can base a proposed rule establishing accounting rules for biomass, as contemplated in the BACT guidance for May 2011 release. There is no value in waiting until May 2011 to proceed with such an effort, and we urge you to quickly move forward with a proposal that excludes biomass emissions from the tailoring rule.

Thank you for your ongoing attention to this matter.

Sincerely,

Max Baucus
Jeff Merkley

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