June 5, 2002

U.S. Department of Energy\
Office of Policy and International Affairs\
Office of Electricity and Natural Gas Analysis, PI-23\
Attention: Voluntary Reporting Comments\
Forrestal Building, Room 7H-034\
1000 Independence Ave., SW\
Washington, D.C. 20585

[via Electronic Mail]{.underline}

To Whom It May Concern:

Thank you for the opportunity to provide comments regarding ways to
improve the Department of Energy's Voluntary Reporting Program to reduce
greenhouse gas emissions.

ISG Resources, Inc., is the nation's largest manager and marketer of
coal combustion products. ISG works with more than 100 coal burning
power plants from coast to coast, assisting in disposal of
non-marketable ash products and developing technologies and markets for
increasing beneficial use of these materials.

Coal combustion products include fly ash, bottom ash, boiler slag and
flue gas desulfurization materials. Many of these products can be used
as valuable additives in the manufacture of a variety of basic building
materials. Numerous federal and state agencies recognize this important
role for coal combustion products:

-   Since 1983, the U.S. Environmental Protection Agency has issued
    federal procurement guidelines directing the purchase of fly ash for
    use in cement and concrete.

-   The Federal Highway Administration and Army Corps of Engineers
    actively endorse the use of fly ash in concrete products.

-   In a 1994 Report to Congress, the U.S. Department of Energy
    concluded that: "\[T\]he increased utilization of coal combustion
    byproducts could provide numerous environmental and economic
    benefits to the United States. Positive environmental effects
    include (1) reduced solid waste, (2) reduced use of natural
    resources, and (3) reduced energy consumption and CO2 emissions from
    the reduced use of natural resources in the production of cement."

When utilized as an ingredient in concrete, fly ash can replace a
portion of the cement that is used. Cement production is a significant
contributor to greenhouse gas emissions. Therefore, for every ton of
cement that is not produced because it is displaced by fly ash use,
approximately 1.1 tons of carbon dioxide are not emitted.

In the United States in 2000, approximately 10 million tons of fly ash
was utilized in cement replacement applications -- meaning that more
than 10 million tons of CO2 emissions were displaced. Industry goals
call for doubling or even tripling that utilization volume by 2020,
representing the easiest, most cost effective single step available for
the United States to dramatically reduce CO2 emissions.

Under current CO2 emissions tracking programs, however, capturing the
data for these emissions reductions is difficult. Climate programs
within the Department of Energy and Environmental Protection Agency tend
to be point-source specific. In other words, measurements are typically
taken within a plant or system and reductions from that specific plant
or system are then tracked against those measurements.

In the case of fly ash displacing cement production, however, the point
of reduction is usually distant from the point of source. A product of
one industry -- coal fired power production -- is being used to displace
emissions from another industry -- cement production. Actual utilization
of the product often involves several parties, including the power
producer who provides ash, an ash marketer who provides storage and
transportation logistics, and the concrete producer who provides a use.
As a result of this disconnection, the United States risks losing track
of significant and beneficial sources of greenhouse gas reductions.

ISG would like to recommend five specific actions as the Department
considers improvements to its Voluntary Reporting Program for greenhouse
gas emissions. ISG recognizes that the framework for voluntary reporting
programs may provide the foundation for more formal reporting or
regulatory programs in the future. Without advocating for mandatory
reporting, ISG would like to ensure that the basic structure of
voluntary reporting programs is sound and comprehensive should a more
formal system ever evolve.

1.  The Department should encourage non-point source specific reporting
    of all actions that reduce greenhouse gas emissions, including
    product substitutions such as was done in the program to reduce
    fluorocarbons. If an industry is able to take measurable actions
    that displace production of CO2 in an unrelated industry, that
    displaced production should be considered as a valid emissions
    reduction.

2.  The Department should develop scenarios for allocating credit for
    non point source specific emissions reductions equitably between the
    parties responsible for creating the reductions.

3.  The Department should actively seek out other industries with
    similar non-point source specific emissions reduction potential.

4.  The White House and the Department, in concert with EPA, the Office
    of Management and Budget and other federal agencies concerned with
    procurement, should direct other federal agencies to more fully
    comply with existing procurement guidelines for fly ash use in
    cement and concrete. Tracking of this compliance can provide
    emissions reduction reporting data directly linked to the federal
    government's own programs, setting a positive example for private
    industry. Such tracking should include direct federal purchases,
    purchases by direct major contractors of the US Government, and
    purchases using grant monies such as major transportation
    disbursements to state and local entities.

5.  The Department should carefully examine the actions of other
    countries with regard to greenhouse gas emissions reduction
    strategies. The Voluntary Reporting Program could then be structured
    to allow for easier applicability to global emissions trading
    systems, should they ever become desirable.

Implementation of these recommendations would have an immediate effect
in encouraging greater utilization of coal combustion products. More
than 76 million tons of coal combustion products are disposed in the
United States annually. By properly valuing the environmental benefits
associated with their utilization, suppliers and users of these products
will have a greater incentive to build infrastructure, develop
technologies and take the other steps necessary to fully utilize this
under-tapped resource.

We look forward to the forthcoming public hearings you will be
scheduling on this important topic. We would be happy to participate or
assist the Department in any way we can.

Respectfully,

Raul A. Deju

President & Chief Operating Officer

John N. Ward

Vice President, Marketing & Communications

ISG Resources, Inc.

136 East South Temple, Suite 1300

Salt Lake City, UT 84111

<jward@isgresources.com>

801-236-9700