Source: https://www.federalregister.gov/articles/2010/09/22/2010-23674/mandatory-reporting-of-greenhouse-gases
Timestamp: 2015-08-03 04:40:59
Document Index: 45900678

Matched Legal Cases: ['art 98', 'art 98', 'art 98', 'art 98', 'art 98', 'art 98', 'art 98', 'art 98', 'art 98', 'art 98', 'art 98', 'art 98', 'art 98', 'art 98', 'art 98', 'art 98', 'art 98', 'art 98', 'art 98', 'art 9', '§ 98', '§ 98', 'art 98']

Dates: The final rule is effective on November 22, 2010.
-57686 (18 pages)
Document Number: 2010-23674
Shorter URL: https://federalregister.gov/a/2010-23674 Related Topics
Corporate Parent and NAICS Code in the Greenhouse Gas Mandatory Reporting Rule Requirements 2 actions from April 12th, 2010 to September 22nd, 2010
EPA has established a docket for this action under Docket ID No. EPA-HQ-OAR-2009-0925. All documents in the docket are listed on the http://www.regulations.gov Web site. Although listed in the index, some information is not publicly available, e.g., confidential business information (CBI) or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available either electronically through http://www.regulations.gov or in hard copy at EPA's Docket Center, Public Reading Room, EPA West Building, Room 3334, 1301 Constitution Avenue, NW., Washington, DC 20004. This Docket Facility is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Public Reading Room is (202) 566-1744, and the telephone number for the Air Docket is (202) 566-1742.
For technical information and implementation materials, please go to the Web site http://www.epa.gov/climatechange/emissions/ghgrulemaking.html. To submit a question, select Rule Help Center, followed by Contact Us. You may also contact Carole Cook, Climate Change Division, Office of Atmospheric Programs (MC-6207J), Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460; telephone number: (202) 343-9263; fax number: (202) 343-2342; e-mail address: GHGMRR@epa.gov.
Table 1—Examples of Regulated Entities by Category Back to Top
a EPA will not be implementing subpart JJ of the Mandatory GHG Reporting Rule using funds provided in its FY2010 appropriations due to a Congressional restriction prohibiting the expenditure of funds for this purpose.
Ethyl alcohol manufacturing facilities.
Primary refiners of nonferrous metals by electrolytic methods.
Secondary magnesium processing plants.
Manure Managementa
CUSIPCommittee on Uniform Security Identification Procedures
DUNSData Universal Numbering System
EOExecutive Order EPAU.S. Environmental Protection Agency
FEINFederal Employer Identification Numbers
On April 12, 2010, EPA proposed this rule amending 40 CFR part 98, which provides the regulatory framework for the GHG Reporting Program (GHGRP).
The GHGRP requires the reporting of greenhouse gas (GHG) emissions and other relevant information from certain source categories in the United States (U.S). The GHGRP, which became effective December 29, 2009, includes reporting requirements for facilities that emit GHGs (“facilities”) and for suppliers of fuels and industrial gases (“suppliers”). Facilities and suppliers that meet the applicability criteria in 40 CFR part 98, subpart A (“regulated entities” or “reporters”) must submit annual GHG reports in accordance with the provisions in 40 CFR 98.3(c).
For more detailed background information on the GHGRP, see the preamble to the final rule that established the program (74 FR 56260, October 30, 2009).
This rule applies to all facilities and suppliers required to report under 40 CFR part 98, including those covered by subparts published on October 30, 2009 (74 FR 56260) and on July 12, 2010 (75 FR 39736).
Therefore, all facilities and suppliers that meet the applicability criteria in 40 CFR part 98, subpart A are required to report the additional data elements included in this rule.
As discussed in greater detail in Sections I.C and II.Q of the preamble to the final Part 98 rule and in the response to comments for 40 CFR part 98,
EPA may gather information for a variety of purposes, including for the purpose of assisting in the development of emissions standards under CAA section 111, determining compliance with implementation plans or standards, or more broadly for “carrying out any provision” of the CAA.
Finally, the information gathered through this rule will be immediately available to enhance EPA's implementation of various nonregulatory programs aimed at encouraging voluntary reductions of GHG emissions. Under the authority of CAA section 103, EPA has launched a variety of nonregulatory programs aimed at reducing emissions of GHGs.
The additional data will assist EPA by providing more detailed information on possible sources, and facility operations within industrial sectors for EPA to work with in the context of these programs.
Currently, three EPA programs collect parent company information: The Toxics Release Inventory (TRI) under Section 313 of the Emergency Planning and Community Right-to-Know Act; Risk Management Plans under CAA section 212(r); and the Inventory Update Rule under the Toxic Substances Control Act (TSCA). Of these three programs, TRI is the only one that requires reporters to submit information on their highest-level U.S. parent company.
TRI requires reporters to report the name of their one parent company with the largest ownership interest in the facility. TRI also requires the parent company's Dun & Bradstreet Data Universal Numbering System (DUNS)
identifier to be reported annually. This amendment to 40 CFR part 98 differs from TRI parent company reporting requirements in that it requires reporting of: (1) All parent companies, rather than just one parent company; (2) the physical address of each parent company, but not the DUNS identifier; and (3) the percentage of ownership interest for each parent company. EPA estimates that approximately two-thirds of the reporters subject to 40 CFR part 98 are also required to report to TRI.
Several EPA programs under the CAA, including the GHGRP,
require reporters to identify the “owner or operator” of each affected facility. Although in some cases, the owner or operator is also the highest-level U.S. parent company, the information currently collected under the majority of CAA programs is not designed to specifically identify the highest-level U.S. parent company, because that information is not necessary to determine compliance with particular regulatory requirements.
The final rule also requires facilities and suppliers reporting under 40 CFR part 98 to report their primary and all additional applicable NAICS codes.
In the large majority of cases, facilities and suppliers will submit a single NAICS code. However, infrequently a facility/supplier may have two distinct products/activities/services providing comparable revenue. In these cases the facility/supplier may also report a second primary NAICS code. Among all EPA programs, only TRI requires reporters to submit primary NAICS codes as well as other relevant NAICS codes. As noted above, EPA estimates that approximately two-thirds of the reporters required to report under the GHGRP are also required to report to TRI.
EPA collects some NAICS code information through routine compliance reporting in multiple programs,
but those programs either do not require primary and other NAICS codes be designated as such, or they do not define a primary NAICS code as it is defined in this rule. In addition, none of the compliance databases provide complete coverage of the facilities and suppliers subject to 40 CFR part 98.
There are currently no EPA programs that require facilities or suppliers to identify and report the use of cogeneration units located at the facility. EPA's Combined Heat and Power Partnership, a voluntary program, requires that partners agree to provide data on existing cogeneration projects to help EPA determine climate benefits.
However, this is a voluntary program and does not provide coverage of all cogeneration units. The Energy Information Administration collects information on cogeneration from utility and non-utility power generators greater than 1 megawatt,
but does not collect this information from all facilities and suppliers subject to 40 CFR part 98.
II. The Final Rule and Reponses to Public Comments Back to Top
Table 2—Instructions for Reporting U.S. Parent Company(ies) Back to Top
The reporting entity is entirely owned by a single U.S. company that is not owned by any other company (e.g., it is not a subsidiary or division of another company)
Provide that company's legal name and physical address as the U.S. parent company and report 100 percent ownership.
The reporting entity is entirely owned by a single U.S. company which is, itself, owned by another company (e.g., it is a division or subsidiary of a higher-level company)
Provide the legal name and physical address of the highest-level company in the ownership hierarchy as the U.S. parent company and report 100 percent ownership.
The reporting entity is owned by more than one U.S. company (e.g., company A owns 40 percent, company B owns 35 percent, and company C owns 25 percent)
Provide the legal names and physical addresses of all of the highest-level companies with an ownership interest as U.S. parent companies, and report the percent ownership of each company.
The reporting entity is entirely owned by a foreign company
Provide the legal name and physical address of the foreign company's highest-level company based in the U.S. as the U.S. parent company and report 100 percent ownership.
The reporting entity is partially owned by a foreign company and partially owned by one or more U.S. companies
Provide the legal name and physical address of the foreign entity's highest-level company based in the U.S., along with the legal names and physical addresses of the other U.S. parent companies, and report the percent ownership of each company.
The reporting entity is owned by a joint venture or cooperative
The joint venture or cooperative is its own U.S. parent company. Provide the joint venture or cooperative's legal name and physical address as the U.S. parent company and report 100 percent ownership.
The reporting entity is a federally owned facility
Enter U.S. Government, and do not report physical address or percent ownership.14
Comments: One commenter noted that collecting corporate identifier information only from those facilities that emit 25,000 metric tons or more of CO 2 per year would provide only a partial picture of a company's overall emissions, as some companies may own facilities with emissions below the 25,000 metric ton threshold. This same commenter suggested that EPA should encourage company-level data reporting and require companies to report the relative emissions of each of their facilities subject to the reporting rule as compared to total company emissions.
Comment: A commenter from the offshore operations sector requested that EPA clearly define the parent company reporting requirements specific to offshore petroleum and natural gas facilities. In particular, the commenter noted that while the offshore facility itself may have a single or multiple owners, each development and/or production field associated with the facility may have multiple owners. The commenter added that this situation could complicate the determination of percentage of ownership interest for each reporting entity.
EPA acknowledges that there is a modest additional burden associated with Option 2 for those reporters with multiple owners and that Option 1 would be the lower cost Option.
The additional total national cost of Option 2 however, was estimated to be less than two percent greater than Option 1. The burden estimate for Option 2 incorporates the additional effort associated with reporters asking legal or management staff for information regarding complex ownership structure. Option 1 supporters neither offered supporting information or estimates of the additional burden nor refuted EPA's burden estimates. EPA concluded that the additional benefits of Option 2 compared to Option 1 outweigh the potential costs of collecting more comprehensive parent company information because the additional cost of Option 2 is minimal while the additional benefit is substantial.
Response: As explained in the Section I.C of this preamble, CAA section 114 is sufficiently broad for EPA to collect this information. Section 114 of the CAA generally authorizes EPA to gather information from any person who owns or operates an emissions source, who is subject to a requirement of the CAA, who manufacturers control or process equipment, or who the Administrator believes has information necessary for the purposes of CAA section 114(a). EPA may gather information for purposes of establishing implementation plans or emissions standards, determining compliance, or “carrying out any provision” of the CAA. For these reasons, the Administrator may request that a person, on a one-time, periodic or continuous basis, establish and maintain records, make reports, install and operate monitoring equipment and, among other things, provide such information the Administrator may reasonably require. This language has been interpreted to grant EPA broad authority. See, e.g., Dow Chemical Co. v. U.S., 467 U.S. 227, 233 (1986) (“Regulatory and enforcement authority generally carries with it all modes of inquiring and investigation traditionally employed or useful to execute the authority granted”). This information is included in the existing ICR.
EPA agrees with the comments that numeric identifiers could potentially facilitate data aggregation, however, the currently available numeric identifiers considered by EPA and proposed by commenters have shortcomings such that they would not enable EPA to adequately aggregate data. As noted in Section II.A of the preamble and in the memorandum “Summary of Existing Company Identifier System” (located in docket EPA-HQ-OAR-2009-0925), some of the identifiers considered (e.g., stock tickers, CUSIP, SEC central index key, and LexisNexis) cover only public companies. EPA expects that reporters under the GHGRP will cover both public and privately-held companies and does not want to exclude a portion of reporters from Agency analyses. Furthermore, limiting the reporting of a numeric identifier to only public companies would place an additional burden on only this subset of reporters. The privately held databases, such as DUNS and CUSIPs, require licensing agreements, which potentially restrict the public use of that data. Finally, in accordance with Internal Revenue Code 6103, FEINs can only be collected and released on a voluntary basis and EPA would have no means to ensure that all facilities/suppliers would report their FEINs.
After considering all of the comments received, this final rule requires that each facility or supplier required to report under 40 CFR part 98 report its primary NAICS code and any additional applicable NAICS codes. For the purposes of this rule, EPA considers a reporter's primary NAICS code to be the six-digit code (or codes) that most accurately describes the reporter's primary product/activity/service, as defined in “North American Industry Classification System Manual 2007,” available from the U.S. Department of Commerce, National Technical Information Service.
The primary NAICS code (or codes) is the product/activity/service that is the principal source of revenue for the facility or supplier. For the purposes of this rule, EPA considers additional NAICS codes to be those codes that describe the product(s)/activity(s)/service(s) at the facility, but that are not related to the principal source of revenue.
The following instructions apply to reporters regarding the reporting of NAICS codes: Enter the six-digit NAICS code that most accurately describes the reporter's principal product/activity/service and designate it as “primary.” Each reporter must provide one primary NAICS code, but may also designate a second code as primary if the reporter has two distinct products/activities/services providing comparable revenue. Provide all additional NAICS codes that describe the reporter's products/activities/services but that are not related to the principal source of revenue. Federal facilities should report the NAICS code that most closely represents the activities taking place at the site. For example, a Federally-owned, fossil fuel-fired electric power plant would be classified as NAICS 221112 — Fossil Fuel Electric Power Generation. For additional guidance on how to determine the proper NAICS code(s), go to http://www.census.gov/eos/www/naics/.
Two commenters requested that EPA allow reporting of more than one primary NAICS code. These commenters stated that this is particularly important for large facilities that consist of separate economic units, such as a petroleum refinery and a chemical plant. The commenters added that this could be important if any future climate change legislation differentiates regulatory requirements according to industry sector or NAICS codes, where requirements for refineries and chemical plants could differ. Accordingly, the commenters concluded, EPA should ensure that the final rule and any required electronic reporting tool allow for entering more than one primary NAICS code per reporter. Finally, one commenter stated that EPA should obtain primary NAICS codes from the Census Bureau.
EPA also considered whether primary NAICS codes could be obtained from the Census Bureau, as suggested by one commenter. However, the facility-level Census Bureau data are confidential as specified in U.S. Code Title 13
, and cannot be accessed by EPA. Therefore, the final rule requires primary and all additional NAICS codes to be reported to EPA by the reporting entity.
Information on the types and characteristics of facilities that employ cogeneration technologies and the performance of cogeneration units could be important to future development of GHG mitigation strategies. EPA recognizes that the information required under this rule may not, by itself, be sufficient to determine the actual quantity of GHG emissions occurring from cogeneration units at individual reporting facilities, companies or NAICS sectors. It also does not provide the degree to which those cogeneration emissions displace fossil fuel or other fuel source emissions from central station generation plants. However, the information reported will allow EPA and States to identify facilities using cogeneration. In addition, EPA recognizes that not all emissions at individual reporting facilities with cogeneration are attributable to the cogeneration unit(s). As such, it should not be inferred that all emissions at an individual reporting facility with cogeneration are attributed to the cogeneration unit(s).
This section provides a summary of the comments and responses on EPA's proposal to require annual reporting for the data elements added to 40 CFR part 98 in the final rule (i.e., U.S. parent company(s), NAICS code(s), and cogeneration by facilities and suppliers). While EPA was interested in receiving comments on the proposal in its entirety, EPA specifically solicited comments on the utility and burden of updating the additional information required by the proposed rule on a more frequent basis than annually, for example, whenever changes occur with respect to a reporter's U.S. parent company or NAICS code(s).
Response: While the development of a comprehensive company-level GHG inventory is outside the scope of this rulemaking, EPA notes the commenter's suggestion and thanks the commenter for their input. For a discussion of why EPA chose to require facility-level reporting, please see Section II.F of the preamble of the final Part 98 (74 FR 56273, October 30, 2009) as well as Section II.A of the preamble to this final rule. For a discussion of why EPA chose a 25,000 metric ton CO 2 e reporting threshold for most sources, please see Section I I.E. of the preamble of the final Part 98 (74 FR 56271, October 30, 2009) as well as Section II.A of the preamble to this final rule.
A facility that contains any source category that is listed in Table A-4 of this subpart that emits 25,000 metric tons CO 2 e or more per year in combined emissions from stationary fuel combustion units, miscellaneous uses of carbonate, and all applicable source categories that are listed in Table A-3 and Table A-4 of this subpart.
The published clause inadvertently omitted the word “and” prior to the clause “* * * that emits 25,000 metric tons CO 2 e * * *” Despite this omission, the regulatory text as it appears in the July 12, 2010 final rule can and should be interpreted to apply to a facility that contains any source category listed in Table A-4 of this subpart if combined emissions from all applicable source categories at the facility are 25,000 metric tons CO 2 e per year or more. Nonetheless, restoring the inadvertently omitted word “and” to the paragraph makes it absolutely clear that the 25,000 metric tons CO 2 e threshold applies at the facility level and not at the source category level. This interpretation is clear from the original rule and from the preamble to the proposal for the subpart A restructuring (75 FR 12451 and 75 FR 12489) and the preamble to the final rule for the restructuring (75 FR 39739). As published, 40 CFR 98.2(a)(2) is technically correct, but reinserting the “and” makes it clearer and less subject to misinterpretation, and makes the sentence structure parallel to that of the original rule text. Therefore, we are revising 40 CFR 98.2(a)(2) by restoring the word “and” to read as follows (emphasis added):
A facility that contains any source category that is listed in Table A-4 of this subpart and that emits 25,000 metric tons CO 2 e or more per year in combined emissions from stationary fuel combustion units, miscellaneous uses of carbonate, and all applicable source categories that are listed in Table A-3 and Table A-4 of this subpart.
III. Economic Impacts of the Final Rule Back to Top
Cost basis. The cost analysis is based on facilities and suppliers currently subject to 40 CFR part 98, including subparts that were finalized after EPA proposed the rule to require reporting of corporate parent information, NAICS codes and cogeneration.
Specifically, the finalization of 40 CFR part 98, subparts T (Magnesium Production), FF (Underground Coal Mines), TT (Industrial Waste Landfills), and II (Industrial Wastewater Treatment) resulted in a higher number of facilities and suppliers subject to this final rule. The analysis does not account for those expected to be added to 40 CFR part 98 through upcoming actions. The methods and assumptions used to estimate the compliance costs for facilities and suppliers currently subject to the rule would likewise apply to those facilities and suppliers that may be added to the 40 CFR part 98 reporting program in the future. The addition of new facilities or suppliers would therefore increase the total compliance costs in proportion to the increase of the reporting universe. Accordingly, EPA does not expect the burden for newly added industries to change the conclusions of this economic analysis.
EPA prepared an economic analysis to evaluate the impacts of the final rule. The analysis estimates the private direct compliance costs per facility and provides a national burden estimate, which includes public costs associated with program implementation and verification activities. Reporting costs were estimated to be less than $100 per facility. As a result, the rule is unlikely to result in significant changes in firms' production decisions or economic choices. D. What are the impacts of the rule on small businesses?
Table 3—Cost Summary Under the Final Rulemaking (in Thousands, $2006) Back to Top
An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9. C. Regulatory Flexibility Act
EPA interprets EO 13045 (62 FR 19885, April 23, 1997) as applying only to those regulatory actions that concern health or safety risks, such that the analysis required under section 5-501 of the EO has the potential to influence the regulation. This action is not subject to EO 13045 because it does not establish an environmental standard intended to mitigate health or safety risks. H. Executive Order 13211: Actions That Significantly Affect Energy Supply, Distribution, or Use
The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. A major rule cannot take effect until 60 days after it is published in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2). This rule will be effective November 22, 2010.
2.Section 98.2 is amended by revising paragraph (a)(2) to read as follows: § 98.2 Who must report?
(2) A facility that contains any source category that is listed in Table A-4 of this subpart and that emits 25,000 metric tons CO
3.Section 98.3 is amended as follows: a. By adding paragraph (c)(4)(v).
(iv) If the reporting entity is owned by a joint venture or a cooperative, the joint venture or cooperative is its own United States parent company. Provide the legal name and physical address of the joint venture or cooperative as the United States parent company, and report 100 percent ownership by the joint venture or cooperative. (v) If the reporting entity is entirely owned by a foreign company, provide the legal name and physical address of the foreign company's highest-level company based in the United States as the United States parent company, and report 100 percent ownership.
3.Section 98.6 is amended by adding definitions of “Cogeneration unit,” “North American Industry Classification System (NAICS) code(s),” “Physical address,” and “United States parent company(s)” in alphabetical order to read as follows: § 98.6 Definitions.
5. Responses to major comments can be found in the preamble to the final Part 98 (74 FR 56260). Responses to additional comments can be found involumes 1 through 42 of the response to comments document entitled “Mandatory Greenhouse Gas Reporting Rule: EPA's Response to Public Comments” in docket EPA-HQ-OAR-2008-0508 (see http://www.regulations.gov/search/Regs/home.html#docketDetail?R=EPA-HQ-OAR-2008-0508).
12. http://www.epa.gov/chp.
13. Energy Information Agency-860, Annual Electric Generator Report http://www.eia.doe.gov/cneaf/electricity/page/eia860.html and, Energy Information Agency-861, Annual Electric Power Industry Report http://www.eia.doe.gov/cneaf/electricity/page/eia861.html.
16. The Office of Management and Budget has proposed revisions to the North American Industry Classification System for 2012 onward. See“North American Industry Classification System—Updates for 2012” 75 FR26855, May 12, 2010. These revisions will not affect this rulemaking, which requires reporters to use the NAICS codes defined in the North American Industry Classification System Manual 2007, regardless of whether these codes are updated in the future.
17. U.S. Code Title 13 guarantees the confidentiality of census information and establishes penalties for disclosing this information. See http://www.census.gov/geo/www/luca2010/luca_title13.html.