UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 

WASHINGTON, D.C. 20460 

JAN 1 2 2011 THE ADMINISTRATOR 

The Honorable Max Baucus 

United States Senate 

Washington, D.C. 20510 

Dear Senator Baucus: 

Thank you for your recent letter about the way that carbon dioxide ("C02") emissions 

from biomass burning will be treated in Clean Air Act permitting of construction projects at 

large stationary sources. As you know, biomass can be part of a national strategy to reduce 

dependence on fossil fuels, and efforts are underway to foster the expansion of renewable 

resources and promote biomass as ways of addressing climate change and enhancing forest 

management. 

Last July, EPA solicited views from the public on approaches to accounting for C02 

emissions from biomass and other biogenic sources, including whether some or all of a source's 

biomass C02 emissions could be discounted based on a determination that they are canceled out 

by the C02 absorption associated with growing the fuel. EPA received information supporting 

the conclusion that certain biomass - such as waste materials whose inevitable decomposition 

will result in greenhouse gas emissions anyway - have only very limited climate impacts when 

combusted as fuel. EPA also, however, received information indicating that the use of certain 

other biomass as fuel could have more significant climate impacts. 

In November, EPA announced that it was reviewing the public's comments with the goal 

ofdeciding whether the Clean Air Act would allow the use of some kind of discounting system 

or other method reflecting the net impacts of biomass combustion in determining the 

applicability of the pre-construction permitting requirement to C02 emissions from biomassfired units. Your recent letter urges EPA to make a positive determination and to start a 

rulemaking promptly. 

As of January 2, 2011, only those large stationary sources that trigger the preconstruction permitting requirement for other pollutants need to address greenhouse gases such 

as C02. No source will be subject to the pre-construction permitting requirement solely because 

of its greenhouse gas emissions until after July 1, 2011. That is one result ofthe Tailoring Rule 

that EPA issued last year. With the approach of July 1 in mind, I am announcing today that, by 

that date, EPA will complete a rulemaking to defer for three years the application ofthe preconstruction permitting requirement to biomass and other biogenic C02 emissions. 

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The purpose of the deferral is to give EPA time to effectuate a detailed examination of 

the science associated with biogenic C02 emissions and to consider the technical issues that the 

agency must resolve in order to account for biogenic C02 emissions in ways that are 

scientifically sound and also manageable in practice. 

EPA will ensure that partners within the federal government and scientists outside of it 

with relevant expertise play meaningful roles in the examination. Following the examination's 

completion, EPA will use its work product in establishing, by notice-and-comment rulemaking, 

the system for determining the applicability of the Clean Air Act's pre-construction permitting 

requirement to projects that result in biomass and other biogenic C02 emissions. EPA's intent is 

to ensure that both the scientific examination and the resulting rulemaking are completed within 

the three-year deferral period mentioned above. 

Concurrent with the proposal to defer application of the pre-construction permitting 

requirement (known as "Prevention of Significant Deterioration," or "PSD") to biomass and 

other biogenic C02 emissions, EPA intends to Issue interim guidance to help permitting 

authorities establish a basis for concluding that the best available control technology (or 

"BACT," which is one of the statutory conditions for receiving a permit) for greenhouse gas 

emissions at such sources is simply combustion of biomass fuels. As noted above, under the 

Tailoring Rule, as of January 2, 2011, large stationary sources that become subject to PSD for 

other pollutants will need to address greenhouse gases such as C02. If such permits are issued 

before July I, 2011, then existing regulations might require that the permits meet the BACT 

requirement for greenhouse gas emissions during an interim period oftime. In guidance issued 

last November, EPA explicitly recognized that a permitting authority might determine that 

certain types of biomass by themselves are BACT for greenhouse gas emissions after 

considering the environmental, energy, and economic benefits of using the fuel. EPA's 

supplemental guidance will provide a basis that permitting authorities may use to support the 

conclusion, during the interim period, that BACT for C02 at such sources is simply the 

combustion of biomass fueL 

I hope you will see the steps described in this letter as following through on my prior 

commitment to exercise whatever discretion the Clean Air Act affords to avoid discouraging the 

use of renewable, domestically-produced fuel in power plants and factories. If you have 

additional questions, please do not hesitate to contact me or to have your staff contact David 

McIntosh in EPA's Office of Congressional and Intergovernmental Relations.