Carbon cap plan would affect Intalco smelter, Ferndale refineries

The Alcoa Intalco aluminum smelter near Ferndale, as seen in 2013, would be ranked against its national peers and given credit for any reductions it has already made in carbon emissions before being required to reduce its emissions further under a state rule proposed Wednesday, June 1, 2016.
The Alcoa Intalco aluminum smelter near Ferndale, as seen in 2013, would be ranked against its national peers and given credit for any reductions it has already made in carbon emissions before being required to reduce its emissions further under a state rule proposed Wednesday, June 1, 2016. The Bellingham Herald

Washington state regulators on Wednesday, June 1, unveiled an updated plan to limit greenhouse gas emissions from large polluters, the latest attempt by Gov. Jay Inslee to push ahead with a binding cap on carbon emissions after struggling to win approval from legislators.

The proposed rule requires large industrial emitters to gradually reduce carbon emissions over time.

The rule would initially apply to about two dozen oil refineries, including the BP Cherry Point and Phillips 66 refineries here in Whatcom County, power plants and other facilities that release at least 100,000 metric tons of carbon a year. Many more facilities likely be covered by the rule as the threshold is lowered over the next decades.

Officials with the Washington Department of Ecology say the rule is needed to protect human health and the environment from climate change.

“Carbon pollution has reached rampant levels and we’re committed to capping and reducing it,” said Sarah Rees, Ecology’s special assistant on climate policy.

It’s the state’s second attempt at an emissions rule.

Ecology officials said Wednesday that the latest version addresses concerns raised by businesses, environmental groups and others when the first draft was released. The agency withdrew that draft rule in February to make changes.

One of the major changes affects Alcoa’s Intalco aluminum smelter near Ferndale. Unlike the initial plan laid out by state regulators earlier this year, Intalco would no longer be required to start reducing its emissions as early as 2017.

Instead, Intalco and other manufacturers of things like cement or glass would be ranked against their national peers, and given credit for how much they have already done to reduce their emissions, Rees said. That process is expected to take place over the next three years.

Officials said they made the change to recognize the need to keep energy-intensive, trade-exposed industries here in Washington. Those industries have global competitors and face unique pressures, and many have already taken steps to reduce their emissions, said Stu Clark, Ecology’s Air Quality Program manager.

If the Ferndale smelter is ahead of the curve for reducing its emissions compared to other facilities, it could get credit for that and not have to make as many changes.

“The more efficient it already is, the less reductions it would have to make,” Clark said.

Under Washington’s proposed rule, expected to be finalized in late summer, large emitters would be required to reduce carbon emissions by about 5 percent every three years, and show they achieved an average reduction of 1.7 percent per year.

Businesses can comply by lowering their emissions, buying “emissions reduction credits” from others in the program, investing in projects that permanently reduce emissions in the state or buy allowances through another cap-and-trade program such as ones run by California and Quebec.

Washington would join nearly a dozen states including California that have capped carbon pollution from industrial sources.

Inslee, who has called climate change “the single most important issue of our time,” has gained national attention on environmental issues but so far has failed in his own state to pass ambitious carbon-reduction proposals, including a plan to charge polluters a fee for emissions.

Frustrated by inaction in the Legislature, Inslee last year used his executive authority and directed state regulators to limit carbon pollution under the state’s Clean Air Act.

“Today is an exciting day in our continued quest to provide cleaner air for Washingtonians,” Inslee said in a video statement Wednesday. He said carbon pollution is hurting the state and cited two consecutive record-setting wildfire seasons that burned about 2,000 square miles, among other climate-related problems.

On Wednesday, Inslee joined leaders of Oregon, California and British Columbia in San Francisco to sign a climate agreement with six West Coast cities. The pact says they will work together to encourage zero-emissions vehicles, to reduce energy use in buildings and to take other measures.

Kris Johnson, president of the Association of Washington Business, said his group is still concerned about the potential economic damage from this new regulation.

“Placing a cap on carbon emissions that targets Washington’s best employers sends the wrong signal to businesses of all sizes, both those that are here already and those hoping to relocate here, by driving up energy costs for employers and families at a time when we are already beginning to see signs of an economic slowdown,” he said in a statement.

According to the state’s preliminary economic analysis, the rule would cost businesses between $1.3 billion and $2.8 billion over 20 years to comply. But it’s also estimated to provide about $14.5 billion in benefits in social costs, such as improved environmental and health conditions, according to a state analysis.

Some critics said the proposed rule doesn’t require enough emissions reductions and disregards current science. “We are extremely disappointed,” said Andrea Rodgers, an attorney representing young activists who sued the state to adopt new rules to limit carbon emissions based on the best-available science.

Bellingham Herald reporter Samantha Wohlfeil contributed to this report.