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EPA Exempts Biomass Electricity; Smooths Path for Wood Bioenergy Projects

From the desk of Amanda Lang, Managing Editor, Wood Bioenergy US:

On January 12, 2011 the EPA announced that it will defer greenhouse-gas permitting requirements for facilities using biomass to make electricity (see “EPA Grants Greenhouse-Gas Rule Exemption”, wsj.com, 1/13/11). During the three-year deferral, the agency will consider third party scientific research to determine a future rulemaking specific to biomass electricity. The agency plans to officially issue the deferral in July 2011. In the meantime, EPA will issue guidance to local air permitting authorities to consider biomass fuel as the best available control technology for greenhouse gas emissions.

Forisk worked with the National Alliance for Forest Owners (NAFO) in December 2010 to research the potential economic impacts of the EPA’s greenhouse gas Tailoring Rule on biomass energy producers. Nationwide the Tailoring Rule captures in the PSD permitting program 87% of the currently operating and announced wood-to-electricity projects and 92% of cogeneration facilities at forest products mills in the continental US.  Prior to EPA’s announcement, the Tailoring Rule put 134 of these projects “at-risk” for cancellation or delays with the following impacts by the year 2021:

  • 5,384 fewer MW of renewable electricity generation in the US;
  • 11,844 to 26,380 fewer renewable energy jobs;
  • $18.0 billion fewer dollars of capital investment in renewable electricity generation; and
  • 53.8 million tons of wood biomass per year removed from the renewable energy marketplace.

The EPA’s decision to defer greenhouse gas permitting requirements for biomass electricity facilities will encourage projects currently in development to move forward. The decision will also shorten expected permitting delays for woody biomass projects that are in or exploring the permitting process. A copy of the Forisk report is available at: http://nafoalliance.org//wp-content/assets/NAFO-Study-Tailoring-Rule-Economic-Impact-20101214.pdf

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