TRIRIGA Insights

Beginning January 1, 2010, organizations will be required to track and report on greenhouse gas (GHG) emissions from those facilities that fall within the U.S. Environmental Protection Agency (EPA) Mandatory GHG Reporting rule. As Lisa Campbell from ERM outlined in the recent TRIRIGA “Learn from the Leaders” webinar, Get Ready for Mandatory Reporting of GHG Emissions, many organizations are unprepared to meet the requirements of the EPA’s rule. The longer organizations wait to assess their facilities to determine whether they fall within the EPA’s reporting thresholds, the more difficult it will be to put the necessary procedures and tools in place to begin tracking carbon emissions.

The need to understand your organization’s exposure to carbon legislation will only become more critical as congress and the EPA move closer to regulating GHG emissions. The EPA has already taken the first steps towards GHG regulation based on their authority under the Clean Air Act. In April the EPA submitted an Endangerment Finding outlining the risk to public health and welfare posed by the current atmospheric concentration of the six major greenhouse gases. This step gives the EPA authority to regulate greenhouse gases under the Clean Air Act. In late September, the EPA took two more steps towards GHG regulation. First, the EPA and the Department of Transportation published proposed regulation to limit certain greenhouse gas emissions from light-duty vehicles. Second, following this announcement, the EPA proposed a rule that would require any facility that emits at least 25,000 metric tons of CO2 (or an equivalent amount of other GHG) to obtain a permit from the state environmental agency. In order to obtain a permit, a facility would need to demonstrate that best practices and technologies are being used to minimize GHG emissions. The EPA estimates that 14,000 facilities would need to obtain permits under this rule. This rule will soon be published in the Federal Registry and will likely go into effect in 2010 unless congressional legislation overrides the rule.

Although the timing and specific rules are uncertain, there is little doubt that greenhouse gas regulations are on the way. Organizations that can accurately evaluate greenhouse gas emissions across all facilities will not only be prepared to comply with upcoming regulations, but they will also have the information necessary to make strategic decisions about reducing their exposure to climate change risks.