The Toxics Release Inventory Was Not Designed to Cover Oil and Gas Production

In a lawsuit filed this week, environmental activists are once again pushing the U.S. Environmental Protection Agency (EPA) to increase its control over American oil and gas production, chiefly by requiring operators to disclose information through the EPA-administered Toxics Release Inventory (TRI). The Environmental Integrity Project (EIP) – an environmental group with a history of manipulating public data in order to criticize oil and gas development – says the EPA refused to address their previous petitions on this issue.

The move comes in the wake of EIP’s previous release of data on air emissions from oil and gas development in Colorado, Louisiana, North Dakota, Pennsylvania, Texas and Wyoming. From that data, EIP claimed that producers were releasing millions of tons of toxic chemicals into the air, and that those emissions went unreported. EIP’s conclusion? Oil and gas producers should be saddled with even more federal regulation, specifically a requirement to report to the TRI.

Contrary to EIP’s claims and requests, TRI is a law wholly unfit to cover activities associated with oil and gas production, as the EPA has said numerous times.

A Brief History of the TRI

The TRI is a publicly-accessible database providing information on disposal and release of chemicals by industries and facilities falling under certain reporting requirements. The program was created in 1986 with the adoption of the Emergency Planning and Community Right-to-Know Act (EPCRA), specifically in response to growing public concern over a series of incidents involving the release of chemicals at industrial plants.

As a result, the TRI program required manufacturers and other permanent facilities that store, transport and use the designated threshold levels of specific chemicals to report any releases into the environment. The law’s focus was on providing information on large manufacturing facilities to emergency response teams, state and local governments, and citizens residing nearby.

In the latter half of the 1990s, the EPA expanded the list of industries required to report under the program. During this process, the agency considered adding oil and gas operators to the list but declined to move the industry beyond the initial screening, concluding in 1996:

“This industry group is unique in that it may have related activities located over significantly large geographic areas. While together these activities may involve the management of significant quantities of EPCRA section 313 chemicals in addition to requiring significant employee involvement, taken at the smallest unit (individual well), neither the employee nor the chemical thresholds are likely to be met.” (emphasis added)

This view was expanded on in 1997, when the EPA once again argued that the TRI was not designed to cover oil and gas production, since those operations are more temporary than the entities designed for inclusion under TRI. As the EPA stated:

“One consideration for not including it was concern over how a ‘facility’ would be defined for purposes of reporting…”

Since then, environmental groups have nonetheless continued to lobby the EPA to include oil and gas operations in TRI’s reporting requirements, despite the fact that the Agency has been crystal clear that the law is not designed to cover oil and natural gas production activities.

Intent of the Law

Based on EPA’s repeated conclusions, it’s clear that the TRI was designed to cover intensive emissions from permanent, stationary sources. But the focus on manufacturing and large-scale industrial activity is also evident in the limitations Congress placed on the program.

The EPCRA Section 313 requirements are specific in detailing the types of industries and activities that are subject to the reporting requirements. In fact, Congress could hardly have been more explicit in this guidance: the legislation included North American Industry Classification System (NAICS) codes typically related to manufacturing that would guide what facilities would be required to comply. Given this specificity, it is clear that Congress was very thoughtful regarding the activities and industries they were seeking to require disclosure from – as well as those they were not.

The process of oil and gas production was clearly not considered for inclusion in the reporting requirements at the origin of the TRI.

It also should be noted that, while Congress was very specific regarding the program, the EPCRA legislation also granted EPA the authority to periodically review and expand the list of industries subject to the requirements. Yet even with that authority, as noted above, the agency has declined on numerous occasions to expand the program to include oil and natural gas production. That’s not because the Agency didn’t want to, but because the law was written to cover different types of activities.

The fact is, exploration and production activities are generally located across a large region on a non-permanent basis. Their operations greatly differ from the typical operations of chemical manufacturers and other industrial processes that were specifically included in the act.

Already Regulated

Opponents of hydraulic fracturing have long claimed that shale development is “exempt” from federal laws. The truth is that states have retained primary regulatory authority over hydraulic fracturing, but oil and gas producers are still regulated under numerous federal laws. In fact, every step of the way they are regulated at the federal, state, and local levels, often at multiple levels simultaneously — and in my cases, under laws that require information disclosure. A report released by the U.S. Government Accountability Office (GAO) in September 2012 makes clear that oil and gas developers “are required to comply” with no fewer than eight federal regulations. From that report:

“As with conventional oil and gas development, requirements from eight federal environmental and public health laws apply to unconventional oil and gas development. For example, the Clean Water Act (CWA) regulates discharges of pollutants into surface waters.  Among other things, CWA requires oil and gas well site operators to obtain permits for discharges of produced water – which includes fluids used for hydraulic fracturing, as well as water the occurs naturally in oil- or gas-bearing formations – to surface waters.  In addition, the Resource Conservation and Recovery Act (RCRA) governs the management and disposal of hazardous wastes, among other things.” (emphasis added)

Thus, subjecting the oil and gas industry to the additional reporting requirements of the TRI would seemingly serve no real purpose, other than to increase the size and scope of the federal government’s control over American energy production.

Importantly, much of the information being petitioned for by environmental organizations is already available via FracFocus, a project of the Ground Water Protection Council (GWPC), an organization whose members consist of state water regulatory agencies. For its part, the GWPC has explained the inherent flaw in attempts to loop oil and gas production into TRI’s reporting requirements:

“To date, EPA has not included oil and gas extraction as an industry that must report under TRI. This is not an exemption in the law. Rather it is a decision by EPA that this industry is not a high priority for reporting under TRI. Part of the rationale for this decision is based on the fact that most of the information required under TRI is already reported by producers to state agencies that make it publicly available. Also, TRI reporting from the hundreds of thousands of oil and gas sites would overwhelm the existing EPA reporting system and make it difficult to extract meaningful data from the massive amount of information submitted.” (emphasis added)

Meanwhile, FracFocus is a national hydraulic fracturing chemical disclosure registry that is being implemented nationwide, with more than 10 state agencies already requiring company disclosure. The program’s success has even been celebrated by environmental organizations:

“That’s the big advancer here. We’re getting a full picture of what’s in that fracking fluid,” said Michael Freeman, an attorney for Earthjustice who worked with industry to write the rules.

What EIP Got Wrong

More specifically, a review of publicly available information shows how deceptive the Environmental Integrity Project’s “emissions” claims truly are.  In its petition to EPA last year, EIP claimed that producers were emitting millions of tons of toxic chemicals into the air, based on data from permit applications.  The data source is important, because in states like Colorado (one of the largest emitters, according to EIP’s “data”), producers are required to report worst-case scenario emissions.  This usually results in the actual emissions being one-third to one-half lower than what’s reported on the permit applications.

To provide one example: the Environmental Protection Agency (EPA) actually measured the emissions from a facility in Rulison, Colorado in a 2009 report and found far smaller emissions rates than what EIP claimed.  Just how far off are the numbers?

  • Benzene: EIP claimed 18,330.30 pounds per year; EPA found emissions were 64 percent lower than that.
  • Toluene: EIP claimed 49,081.60 pounds per year; EPA found emissions were 69 percent lower than that.
  • Xylenes: EIP claimed 84,589.23 pounds per year; EPA found emissions were 66 percent lower than that.
  • Methanol: EIP claimed 331,994.00 pounds per year; EPA found emissions were 99 percent lower than that.

That’s not the only problem with EIP’s data.  In many cases, companies will submit permit applications, but never go through with construction of the wells or facilities described, be it for financial reasons or other company considerations. Yet, the emissions remain reported in the applications.  In other cases, well sites that are no longer producing are often not taken off the database, suggesting again that EIP alleged chemical emissions in areas where they are not being emitted.

As such, EIP’s reliance on permit applications means their emissions “data” are deliberately inflated, and EIP’s report is little more than an arbitrary inflation of the risk emanating from oil and gas facilities.

Conclusion

While environmental organizations like EIP will likely continue their lobbying of EPA to include oil and gas production under the TRI, a look at the program’s intent and purpose demonstrates that this additional requirement would serve no real purpose. Indeed, since most of the information requested by EIP is already reported to state regulatory agencies, adding reporting requirements under TRI would only serve to saddle the industry with additional federal regulation.

Moreover, it’s telling that these organizations must deliberately misrepresent the role of TRI in order to argue that oil and gas exploration and production should be covered activities. If the law justified inclusion of oil and gas, the facts should suffice. Indeed, in this case, they clearly do not.

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