On October 30, 2009, the Mandatory Greenhouse Gas Reporting Rule was published in the Federal Register, thereby implementing the first nationwide mandatory greenhouse gas (GHG) reporting program in the United States. Approximately 10,000 facilities, accounting for about 85 percent of GHGs emitted in the United States, are covered under this rule.

Who Is Covered?

In general, the rule applies to large direct emitters of GHGs with emissions equal to or greater than 25,000 metric tons of carbon dioxide equivalents (CO2e) per year, suppliers of fossil fuels and industrial chemicals, and manufacturers of motor vehicles and engines. The emissions thresholds are based on actual emissions. Therefore, the vast majority of small businesses will not be required to report their emissions because their emissions fall well below the threshold.

The rule details reporting requirements for 30 source categories, including definitions of the source categories and applicable exemptions, applicable thresholds, GHGs to report, GHG emission calculation methods, emissions factors, and monitoring, recordkeeping and reporting requirements. In addition, the rule amends existing motor vehicle and engine requirements to include the reporting of GHG emissions as part of the certification procedure.

For further guidance on the applicability of the mandatory GHG reporting rule, see Figure 1 and Tables 1 to 5.

What Must Be Reported?

The rule requires affected sources to report applicable emissions of the following GHGs:

• Carbon dioxide (CO2)
• Methane (CH4)
• Nitrous Oxide (N2O)
• Sulfur hexafluoride (SF6)
• Hydrofluorocarbons (HFCs)
• Perfluorochemicals (PFCs)
• Other fluorinated gases, such as nitrogen trifluoride and hydrofluorinated ethers (HFEs)

Certain suppliers and vehicle and engine manufacturers will report at the corporate level. However, for most sources reporting is done at the facility level, with each affected facility reporting emissions from all applicable source categories within the boundary of the facility. Reporting is only required for source categories for which calculation methods are provided in the rule.

When Does Reporting Begin?

Under the rule affected facilities must begin collecting emissions data on January 1, 2010. From January 1 through March 31, 2010, facilities may use best available monitoring methods for any parameter that cannot be reasonable measured according to the requirements for the applicable source category, but by April 1, 2010, all facilities must be in compliance with the monitoring requirements for the applicable source category.

The first annual report must be submitted to EPA by March 31, 2011 for the calendar year 2010, except for vehicle and engine manufacturers, which will begin reporting for model year 2011.

Exiting the Reporting Program

Once a facility or supplier is subject to the requirements of the Mandatory GHG Reporting Rule, the facility or supplier must continue to submit annual GHG emissions reports even if the facility or supplier no longer satisfies the applicability criteria. Facilities or suppliers may exit the mandatory GHG reporting program if any of the following occur and a notification is submitted to EPA announcing the cessation of reporting and the reasons for the reduction in GHG emissions or certifying the closure of GHG-emitting operations:

• Reported GHG emissions are less than 25,000 metric tons of CO2e per year for 5 consecutive years.
• Reported GHG emissions are less than 15,000 metric tons of CO2e per year for 3 consecutive years.
• Applicable GHG-emitting processes or operations cease to operate (this does not include temporary or seasonal shutdowns).

Reporting must resume if annual emissions at applicable facilities or suppliers increase to 25,000 metric tons of CO2e or more at any time in the future, or if previously shutdown GHG-emitting processes or operations resume operation.

What Should Be Done To Prepare for January 1, 2010?

Determine If Your Facility Is Subject To the Rule

The following are a few steps to help determine if a facility or supplier must comply with the Mandatory GHG Reporting Rule:

• Carefully review the applicability criteria in 40 CFR 98.2 to determine if your facility contains any of the applicable source categories.
• Review the applicable source category requirements to determine the scope of applicability and if any units at the facility may be exempt.
• Review the GHG emission calculation methods for any applicable source category and determine if the facility meets or exceeds the applicable thresholds.

See Figure 1 and Tables 1 to 5 for further guidance.

Understand Emissions Calculation Procedures

Read through the applicable source category requirements and gain an understanding of the nature of the required monitoring, data collection, and calculation methodologies. It is possible that either new monitoring equipment will be needed or existing equipment will need to be used differently. Make sure that any selected equipment or procedures meet quality assurance/quality control guidelines for the source category and fits in with the facility and personnel.

Ensure New Procedures or Technology Fit the Facility

Proper purchase orders, instructions, training, etc. must be obtained and implemented so that a new monitoring or data collection process can be smoothly incorporated into a facility’s standard operating procedures.

Perform a “Practice Run”

If the procedures for data collection can be incorporated very soon, perform a brief run of data collection, perhaps one or two weeks, before the end of 2009. Use the data to calculate GHG emissions and determine whether the procedures are working smoothly and producing the high quality GHG emission data required by EPA.

Create or Refine Software

The facility has put forth much effort to collect the proper data. Therefore, it is important to install new software or refine existing software to reliably store the data for easy access, and to ensure that useful reports can be compiled for submittal to EPA and for internal purposes.

Make People Aware

Compliance with the GHG reporting requirements will not be as onerous if people at the facility and within the company know why the reporting must be done, what must be reported, how it must be reported, and when it must be reported. Inform your colleagues of the important aspects of the GHG reporting rule, ranging from the Designated Representative and managers to floor staff that will be collecting data so that the entire data collection, emission calculation, and reporting process will go smoothly.

How Will Existing Programs Be Impacted?

In many instances, federal regulatory programs are delegated to state regulatory agencies to be administered at the state level. However, the Mandatory GHG Reporting Rule will not be delegated to the states. EPA will administer and enforce the reporting requirements.

Climate change programs to monitor and control GHG emissions, including voluntary and mandatory GHG reporting programs, have existed at the regional and state levels for some time. The Mandatory GHG Reporting Rule does not supersede any of these requirements and must be complied with in addition to any state and/or regional requirements.

For a summary of states currently involved in mandatory and voluntary reporting programs, along with other climate change actions being taken at the state level, see Table 6.

Mandatory GHG Reporting: The Bottom Line

It should come as little surprise, but the implementation of a national mandatory GHG reporting regulation is a clear indication that GHG emissions controls in the United States are on the horizon. Existing sources operating in states with mandatory reporting and/or GHG emissions control programs have a head start but will have to pay close attention to the federal requirements to identify any differences between the state and federal programs.

Sections of the feature are excerpts from How to Prepare for EPA’s Mandatory GHG Reporting Rule, by Marc Karell, P.E., CEM.

Figure

Figure 1: Applicability Flowchart for Direct Emitting Sources

Tables

Table 1: “All In” Source Categories

Table 2: Threshold Source Categories

Table 3: Combustion Source Categories

Table 4: Fuel Suppliers

Table 5: Industrial GHG Suppliers

Table 6: State Actions to Address Climate Change

* V = Voluntary, M = Mandatory