NGI The Weekly Gas Market Report
A major pipeline group fired off an angry letter Friday askingthe Environmental Protection Agency (EPA) to reconsider a “policydecision” that would force pipelines to shell out at least $280million – money that would have to be diverted from expansionprojects – for “unproven” technology to meet a 90%-reduction targetfor nitrogen oxide (NOx) emissions.
“…[I]t was with a sense of disbelief that we read youragency’s recent technical clarifications to the final rule onnitrogen oxides and ozone control,” which would require pipelinesand other companies to invest in costly selective catalyticreduction technology (SCR) to meet a 90%-reduction target for NOxemissions, Jerald V. Halvorsen, president of the Interstate NaturalGas Association of America (INGAA), wrote in a letter to EPAAdministrator Carol A. Browner. The agency’s action runs counter tothe Clinton administration’s objectives to increase natural gas useand reduce greenhouse gas emissions, he added.
The effect of EPA’s new interpretation of the ozone rule willdeprive pipeline companies of about $280 million that has beenearmarked for expansion plans over the next five years, causingthem instead to invest it in technology that is not cost-effective,Halvorsen said. “That will curtail the pipeline industry’s abilityto serve the new and emerging natural gas markets and hamper itsability to contribute to solutions to the climate-change problem.And it has the potential to raise the cost of natural gas to apoint that it will impede the development of market-based optionsfor electric utilities to reduce their greenhouse gas emissions.”
The agency’s clarifications “effectively pushed aside” theresults of numerous studies that have concluded that a90%-reduction target for emissions “cannot be economically achievedon the majority of natural gas reciprocating compressors.”
INGAA requested that EPA “reopen your rulemaking, reevaluateyour analysis on the technical merits of SCR as a cost-effectivetechnology to reduce NOx emissions for all internal combustionengines and adjust the state budgets to reflect a feasibletechnology.” It asked that the agency act quickly in light of thetight time frames it has given the states to prepare their ownNOx-reduction plans.
The pipeline group also sent letters to top committee chairmenin the Senate and House – Sen. John H. Chafee (R-RI), Sen.Christopher S. Bond (R-MO), Rep. Jerry Lewis (R-CA) and Thomas J.Bliley Jr. (R-VA) – asking that they hold oversight hearings “todetermine why EPA is ignoring its own collaborative process infavor of uneconomic proposals that will not come close to meetingtheir targets.”
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