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Administrator Johnson, National Petrochemical and Refiners Association Annual Meeting, Salt Lake City, UT
03/20/2006
As I was flying here to beautiful Salt Lake City, I was reading up on the work of NPRA, and I came across your mission statement which speaks of your commitment to improving the lives, economy, security, and environment of our nation. I had to blink to make sure I wasn’t mistakenly reading EPA’s mission statement. Your association’s commitment to improving the environment is part of the bigger picture of spreading the ethic of corporate environmental stewardship. More and more of our companies and organizations are leading the way in being good stewards of our national and global environment. Like refiners, a growing number of industries are finding that their customers have high expectations for how products or services they purchase affect the environment. EPA is working collaboratively with many businesses to voluntarily reduce their environmental impacts in cost-effective ways. Leading industries are proving, that doing what’s good for the environment, is also good for business. Consumers expect a lot from the companies they buy from, and they expect a lot from their government. Americans count on their government to keep the economy growing, to be leaders in the world, and to protect their environment. EPA is helping to fulfill these expectations by meeting President Bush’s charge to accelerate the pace of environmental progress while maintaining our nation’s economic competitiveness. What’s good for the environment, is also good for business. The President knows, in order to keep our economy and our environment improving, we must promote energy that is reliable, secure, and clean. The reliability of our energy supply was front page news just six months ago, when we began to fully understand the consequences of hurricanes Katrina and Rita. As you know better than I, this disaster caused tremendous damage to crude oil production facilities in the Gulf region, with crude oil refining capacity dropping from 5 million barrels per day, to one million, as well as extensive damage to the pipeline system. EPA, working with the Department of Energy and refiners, responded quickly and decisively. In order to help lessen the storm’s impact on the rest of the country, President Bush asked EPA to temporarily waive specific standards for gasoline and diesel fuels. By allowing greater flexibility for the fuel distribution system, the waivers we issued addressed the impacts of the disaster on fuel supplies, and minimized the potential for supply disruption. All in all, EPA issued 31 temporary fuel waivers, which ended up covering all 50 states – helping to ensure that fuel was available for use by emergency vehicles, for evacuations, and for others dealing with the approach and aftermath of the hurricanes. I want to thank everyone here today who was part of that process. We have also spent considerable time assessing the impacts of Hurricanes Katrina and Rita on implementation of the ultra low sulfur diesel program, or ULSD. Based on the detailed information available to us, as well as conversations with the affected refiners, the impacts of the hurricanes appear to be temporary and are not expected to interfere with successful implementation of ULSD. It is a refinery-specific issue that can be effectively dealt with through the hardship provisions provided for in the rulemaking and need not impact the overall successful implementation of the program. But even without the disruptions caused by natural disasters, the reliability of our nation’s energy supply remains a challenge. As you know all too well, for the last three decades, no new refinery has been built in the United States. Instead, the expansion of refinery capacity has occurred solely at existing facilities, which now operate at close to maximum capacity. This has put a strain on our existing fuel system, and carries with it potential disruption to fuel supplies. Last year, the President signed the Energy Policy Act in order to reverse this trend. It contained a provision to allow “cooperative agreements” between states, EPA and other federal departments and agencies with regard to the permitting of new refineries. In order to provide a secure, stable, and reliable energy supply, the President unveiled his Advanced Energy Initiative. His initiative calls for new investments in refinery capacity, either through expansions at existing sites, or through construction of new facilities on former military sites. The President wants to work with Congress to develop a one-year, EPA-led permitting process that can provide expedited decisions, while maintaining high environmental standards. EPA is committed to working hand-in-hand with Congress on any legislative effort on this issue. But whether through the exercise of existing authority, or through implementing new legislation, EPA will fulfill its responsibilities to ensure a clean and healthy environment while we support the nation’s energy infrastructure. This infrastructure must be reliable and secure. This security comes from our nation’s ability to invest in the technology that is powering our nation’s economy and driving our environmental successes. As a lifelong scientist, I’m a true believer in the potential for technology to improve the well-being of our country. I walked through the doors of EPA for the first time 25 years ago, and while it seems like just yesterday to me, a lot has changed over that time. As I look across this crowd and see a lot of gray hairs like my own, and in some cases very little hair, I’m assuming you too can appreciate how times have changed. When I began at EPA, we used typewriters and blackberries were just something you ate. Today, we have powerful computers and hand-held equipment that lets us bring real-time information right to the heart of a crisis. This technology is powering our nation’s economy and driving our environmental successes. In his State of the Union Address, the President announced a new national investment in energy innovation in order to break America’s dependency on foreign sources of power. His Advanced Energy Initiative includes a national goal of replacing more than 75 percent of our oil imports by the year 2025. The President knows that America is too reliant on foreign energy, and the best way to break this dependency is through innovative technology. President Bush and EPA are working to change the way we power our homes, our businesses and our automobiles. As part of the President’s national energy strategy, our nation has funded nearly $10 billion in developing energy sources that are cleaner, cheaper and more efficient. Through the innovation of our nation’s industries, this president is showing that doing what’s good for the environment is also good for business. Over the past four years, the Bush Administration has worked to increase domestic energy supplies, encourage efficiency and conservation, and develop alternative and renewable sources of energy. By investing in renewable, innovative energy sources today, President Bush and EPA are preserving our past, while enhancing our energy, economic and environmental future. I’m sure that most of you are familiar with the Renewable Fuel Standard provision in the President’s Energy Bill. That provision is designed to reduce vehicle emissions and strengthen the nation’s energy security by doubling the use of fuels produced from American crops by 2012. So instead of spending our money on imported oil, we can invest in domestic jobs, strengthen our national security, and support American agricultural communities. While we were able to come up with a simple approach to implement the default standard for 2006, EPA plans to proceed with a comprehensive RFS rulemaking for 2007 and beyond. In the meantime, EPA has been gathering input on this rule from key stakeholders – refiners, renewable producers, agricultural interests, and the Department of Energy. We have had a number of successful meetings with representatives of the oil and renewable fuels industries and we will continue this dialogue as we develop the RFS rule. These are exciting times for America. The President has set big goals for our nation’s energy security, our economic well-being, and our environmental health. Today, as we look back on our environmental accomplishments, we can be proud to say that America’s air is the cleanest it has been in three decades – and we are not done yet. Since 1970, we have cut emissions that cause soot, smog and acid rain by more than half, even while our nation’s economy has more than doubled - clear evidence that a growing economy and environmental results can, in fact, go hand-in-hand. When I speak to the employees at EPA, one of the things I always stress is that our goal is not only to protect the environment for today’s citizens – are goal is to protect our nation’s environment for future generations of Americans – our grandchildren and great-grandchildren. President Bush and EPA are committed to protecting our country’s future leaders by making that black puff of diesel smoke from school buses something you only read about in history books. Thanks to EPA’s Clean Diesel Trucks and Buses Rule, next fall all the new trucks and buses on the road will emit half as much smog causing nitrogen oxides. There will also be a 90 percent reduction in particulate matter emissions. And the nonroad diesel engines are not far behind. When our diesel program is fully implemented, 20,000 deaths will be prevented in the United States each year. As you know, pollution – especially air pollution – knows no political boundaries. Improving diesel fuel is truly becoming an international effort and I want to recognize that every company here today is in some way committed to bringing clean diesel to the global market. Billions of dollars have been invested by the diesel engine industry and refiners and I know your companies are working hard to make this program a success. EPA staff is in regular communication with the engine manufacturers and fuel producers, discussing their implementation plans. Currently, there are more than 250 prototype ‘07 vehicles in commercial operation – in customers’ hands – and this number will grow rapidly over the next several months. And we are hearing that these new engine products are performing well. EPA has put more emphasis on the successful implementation of the ULSD program than any other program in my tenure. From refinery precompliance reports to the sulfur test program to the implementation workshops, we’re working with all parties to ensure smooth and effective implementation. EPA’s proposal to strengthen the standards for fine particulate matter is yet another important tool in our comprehensive tool-box to deliver the American people cleaner air and healthier lives. Based on the best available science, EPA has recently proposed to strengthen national air quality standards for fine particulate matter - the pollution that reduces visibility and impacts human health. To ensure that the final decision on the standards considers the best scientific information available, EPA will review and assess any significant new studies not available for consideration as part of the proposal, including studies submitted during the public comment period. Our environment continues to get cleaner and our economy continues to grow. Over the last several years, EPA has taken multiple actions to change its New Source Review permitting program, or NSR. These actions have been designed to provide greater flexibility for facilities to improve and modernize their operations in ways that can reduce energy use and air pollution. They also provide incentives to install state-of-the-art pollution controls, removing counterproductive barriers to investments in energy efficiency and pollution control projects. Improving the NSR program remains a top Agency priority, and we will soon propose a rule by June of this year that would clarify when New Source Review would apply to a “major” industrial source of air pollution. Both aggregation and debottlenecking have been implemented through guidance throughout the years. By putting these in rulemaking, we would be providing clarity and certainty to both the regulated community and the permitting authorities. As you may know, last week the DC Circuit Court vacated our Equipment Replacement Provision rule. While we are disappointed in the ruling, EPA plans to continue to work on efforts to improve and streamline the NSR program in accordance with the Court’s opinion. These efforts will help us continue on our steady march toward cleaner air and a healthier future - not just here in America, but throughout our global community. As good global neighbors, the United States is making great progress toward the President’s goal for reducing greenhouse gas intensity by working hand-in-hand with business to voluntarily reduce their climate footprints in cost-effective ways – and we are on track to meet the President’s ambitious goal. One of the President’s key climate programs is EPA’s Climate Leaders effort, which is now working with 78 leading companies to set aggressive greenhouse gas reduction targets and then document their progress toward the goal. Together, our partners are preventing the emissions of more than eight million metric tons of carbon equivalent per year – equal to taking more than five million automobiles off the road. I encourage you to join this partnership effort and build on the environmental gains we are already achieving. EPA also manages several voluntary climate change programs focusing on clean energy. As of 2004, American consumers have reduced demand for electricity by about 4 percent through our voluntary ENERGY STAR program – saving $10 billion and reducing greenhouse gas emissions equivalent to those of 20 million vehicles. Our Green Power and Combined Heat and Power Partnerships — established through the President’s National Energy Policy — complement ENERGY STAR by working with industry and utilities to foster investment in clean distributed generation and renewable energy. In addition, EPA’s Methane to Markets Partnership promotes the cost-effective recovery of methane, a potent greenhouse gas and energy source, through global partnerships between developed and developing countries, with strong participation from the private sector. Sixteen countries have joined the program, most recently India – the third largest methane-emitting country in the world – since its launch in November 2004. Our nation is leading the pace in both environmental and economic progress – proving that what’s good for the environment is also good for business. Once again, I would like to thank the National Petrochemical and Refiners Association for inviting me to join you today. Together with your members, EPA and President Bush are working to deliver America a healthy environmental and healthy economic future. Thank you. |
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