Big Oil Mounts Shameful Attack on Clean Air and Public Health

Assembly Democrats Back Repeal of Tough DEP Clean Air Rule for Gasoline Storage Tanks

tanks at Bayway Refinery (Linden, NJ)

Obscene Corporate Profits More Important that Childrens’ Lungs

Last Thursday, the Assembly Regulatory Oversight Committee released a resolution (ACR 132) that found a DEP clean air regulation “inconsistent with legislative intent”, the first step of repealing the rule.

Tom Johnson of NJ Spotlight wrote a good story last Friday: Assembly Committee Rescinds Tough Anti-Smog Regulation – Rule aiming to cap pollution from petrochemical storage tanks found inconsistent with earlier laws:

Bill Wolfe, director of the New Jersey chapter of the Public Employees for Environmental Responsibility, defended the rule, saying the federal Clean Air Act contemplated a strong role for states to define control measures that were state-specific.

Today’s Philadelphia Inquirer story goes further and documents political contributions by the oil industry to influence NJ legislators: Lawmakers including Paulsboro’s Burzichelli seek to roll back oil-refinery rules

It is obvious that the oil industry is cynically trying to capitalize on the current economic recession and Governor Christie’s regulatory relief policies to roll back a 2009 DEP regulation on gasoline storage tanks.

The rule was proposed back in 2008 and has been on the books for almost 3 years. The legislature had ample opportunity to raise objections during the 2008 public comment period but failed to do so.

Obviously, the only relevant thing that’s changed since then is Governor Christie’s “regulatory relief” policy agenda, which has invited oil industry lobbyist to mount a legislative attack.

DEP justified the gas tank rule as part of a comprehensive EPA approved State Implementation Plan (SIP) to meet EPA federal ozone (smog) standards (NAAQS). NJ is not in compliance with the current 75 ppb ozone NAAQS:

“The Department estimates that attaining the Federal 1997 8-hour NAAQS for ozone in New Jersey would eliminate about 40,000 asthma attacks each year and substantially reduce hospital admissions and emergency room visits among children and adults with asthma and other respiratory diseases (NJDEP 2006 ozone report). As such, implementing the proposed RACT rules would not only yield greater air quality benefit, but also would save lives and money and provide better living conditions for the people of New Jersey, especially the susceptible populations. Based on an article in the April 2007 of Harvard Center for Risk Analysis newsletter Risk in Perspective the Department estimates that ozone exposure results in increased deaths per year in New Jersey (Relationship between Exposure and Mortality Risk, Risk in Perspective, Vol. 15, Issue 2, p.1 (April 2007); available at http://www.hcra.havard.edu/perspective.html). 

DEP bent over backwards and gave the oil industry until 2020 – 10 years – to comply with the requirements to control volatile organic compound (VOC) emissions from their storage tanks, primarily located at refineries.

DEP estimates that the rule will reduce current VOC emissions from gasoline tanks by 130 tons per year. DEP estimates that these requirements will apply to about 70 tanks and cost $58 million. If that cost were fully passed through to consumers, the impact would be less than one penny per gallon of gas at the pump.

Obviously, that $58 million wouldn’t put a dent in the industry’s rising multi-billion profits.

But, strategically, this DEP gas storage tank rule is chump change – there are far larger issues in the pipeline.

Refineries will be required to reduce emissions even further to meet new EPA ozone standards (EPA proposed to reduce the current 75 ppb ozone standard to a range of 60 – 70 ppb in the January 19, 2010 Federal Register).

The oil industry is also seeking to derail EPA’s recently announced plans to adopt new greenhouse gas emissions controls at refineries by December 2012 (the so called national “new source performance standards”, NSPS for new or modified sources). States would then have until 2015 to develop state level NSPS for existing sources. NJ DEP will determine what greenhouse gas emission NSPS should be required at NJ oil refineries (and power plants). 

The oil industry is using this gas tank rule to draw a line in the sand and frame the debate on larger upcoming issues. As usual, they rely on the Big Lie about environmental requirements and the economy  (the current slogan is “job killing“).

For example, ACR 132 sponsor Burzichelli used that Big Lie in the Inquirer story, where he falsely claimed that the recent closure of the Sunoco refinery in West Deptford was related to environmental compliance costs. But, in reality, that refinery closed due to slack or declining demand for gas as a result of the recession.

The pawn in these larger debates is a rollback of existing gasoline storage tank vapor control air quality requirements.

If the business community can back DEP off these current requirements, they build power to deter future requirements.

Here’s how the oil industry is seeking to back DEP off.

Under a 1993 amendment to the NJ Constitution, the legislature may veto state agency regulations if both Houses pass Resolutions that find that a regulation is “inconsistent with legislative intent”. The legislature was given this power in the wake of a highly controversial rule proposed by the Florio Administration – known as the “runny egg rule” –  which triggered one of the first talk radio driven political backlashes.

This veto power has been used very rarely. Instead, legislative oversight hearings are typically is used more as a political threat in order to extract concessions.

That’s exactly the Kabuki we saw yesterday. They are all playing a political game – here’s how it goes (listen here, the testimony starts about 20 minutes in) :

• Assembly Regulatory Oversight Committee Chairman Burzichelli is the sponsor of the bill. He begins the hearing by saying that the testimony must be narrowly limited in focus to legislative intent, not to policy arguments. He then uses this to shut down environmentalist testimony on health effects. But he sits back and allows oil industry lobbyists to complain about the high costs of the regulation;
• Although Burzichelli knows the Resolution amounts to a legal gun to DEP’s head, he claims there is no adversarial role with DEP and emphasizes the fact that DEP Commissioner Martin has agreed to meet privately with him and the regulated oil industries;
• DEP appeared to testify to support the rule, thus creating the public appearance of protecting the environment (that provides insulation from press criticism);
• But, DEP bent over backwards in testimony to assure Burzichelli and industry lobbyists that the Department is “sensitive” to costs, understands the concerns of the business community, and encouraging them to use an exemption provision in the rule (wink/nod); and
• Oil Industry lobbyist testimony repeatedly cited Governor Christie’s regulatory relief policies (cost benefit analysis and a policy not to be more stringent than federal minimums) and the Red Tape Report recommendations to promote flexibility.

The icing on the cake that makes this game possible?

There is a huge loophole in the DEP rule in question, under which DEP can let polluters off the hook based on a cost analysis.

According to DEP: 

Costs are also considered on a unit specific basis if costs are shown in an Alternative VOC control plan submitted pursuant to N.J.A.C. 7:27-16.17 to be economically infeasible because of unusual site specific circumstances which result in extreme costs.

In this case, the DEP rule in question requires that gasoline storage tanks install vapor controls to reduce emissions of volatile organic compounds (VOCs), including hazardous air pollutants like benzene, a known carcinogen.

VOCs are ozone precursors and contribute to unhealthy air quality commonly referred to as smog, or in regulatory jargon, exceedence of the NAAQS for ground level ozone.

NJ does not meet the current ozone standard and must sharply reduce current emissions.

In addressing the legislative intent question, a basic understanding of how the federal Clean Air Act works is necessary to understand what’s going on. According to EPA: 

In setting primary ambient air quality standards, EPA’s responsibility under the law is to establish standards that protect public health. The Clean Air Act requires EPA, for each criteria pollutant, to set a standard that protects public health with an adequate margin of safety.” As interpreted by the Agency and the courts, the Act requires EPA to base this decision on health considerations only; economic factors cannot be considered.

The prohibition against the consideration of cost in the setting of the primary air quality standards, however, does not mean that costs, benefits or other economic considerations are unimportant or should be ignored. The Agency believes that consideration of costs and benefits is an essential decision making tool for the efficient implementation of these standards.

The impacts of cost, benefits, and efficiency are considered by the States when they make decisions regarding what timelines, strategies, and policies make the most sense.

New Jersey’s comprehensive set of strategies to meet the NAAQS for ozone are found in the EPA approved State Implementation Plan (SIP).

I will address the legislative intent issues in detail in a susequent post. Drive Safely Now! (an absurd oxymoron, if ever there was one!)