Move to force US industry to report emissions

By Fiona Harvey in London
Published: March 11 2009 02:58

The US Environmental Protection Agency has proposed new regulations that would require thousands of companies to report their greenhouse gas emissions, in the first step towards a federal system of controlling emissions from industry.
Under the proposal, large companies in several heavy industrial sectors would have to monitor their carbon dioxide emissions and report them to the EPA, starting from next year.

Lisa Jackson, the EPA’s administrator, said: “Our efforts to confront climate change must be guided by the best possible information. Through this new reporting we will have comprehensive and accurate data about the production of greenhouse gases ... without placing an onerous burden on our nation’s small businesses.”
The plan is seen as a first step towards the creation of a nationwide cap-and-trade system to restrict carbon emissions, the central plank of President Barack Obama’s climate change policy.
David Doniger, policy director of the climate centre for the Natural Resources Defense Council, an environmental group, said the move showed the urgency with which the administration viewed tackling emissions. “The EPA is laying the foundation for strong action on global warming this year.”
Ms Jackson’s decision to move forward with emissions monitoring reverses Bush administration policy. The Supreme Court in early 2007 ruled that the Clean Air Act could be used in this way, and an act passed by Congress in December of that year directed the EPA to publish a mandatory greenhouse gas emissions reporting rule by June 2009. But former president George W. Bush’s administration did not act on it. The new administration has revived it, as part of its plans for a federal cap-and-trade system to start from 2012.
About 13,000 facilities, which the EPA said accounted for 85 to 90 per cent of US greenhouse gases, would be covered by the proposed rule. The reporting requirements would apply to oil and gas suppliers, electricity generators, chemicals companies, cement makers, automotive manufacturers and others. However, only companies with emissions of more than 25,000 tonnes a year would have to report their emissions. The EPA said the “vast majority” of small businesses would not be covered.
Complying with the proposed regulations would cost about $160m (€126m, £116m) in the first year, according to EPA estimates, falling to $127m in subsequent years as the reporting systems were established.
Many businesses have been expecting to have to report on their carbon dioxide emissions, and two thirds of the S&P 500 large public companies already do so, according to the Carbon Disclosure Project, an organisation owned by investors. It requests companies to report on emissions as they do their financial results.
Copyright The Financial Times Limited 2009