Emission Solutions June 2009 Newsletter

AN INTERNET PUBLICATION OF KLAUS EQUIPMENT COMPANY - PITTSBURGH PENNSYLVANIA

Volume 10 Issue 8 June 2009 Newsletter

IN THIS ISSUE

GREEN JOBS NOT AN AUTOMATIC FIX

CHEMICAL INDUSTRY IS A KEYSTONE OF THE ECONOMY

OHIO EPA SETS UP ONLINE EMISSION BANK

JAY SAYS

GREEN JOBS NOT AN AUTOMATIC FIX

June 8, 2009

In the current uncertain economic climate, it's easy to accept the logic of investing in green technologies as the ultimate tonic for both an ailing planet and a sick economy. But the sweeping claims being made about this solution to the nation's current economic problems merits closer scrutiny, says Jerry Yudelson, author of eight books on corporate sustainability and green building.

"The idea that green jobs can solve both climate change and the current recession is a tall order," says Yudelson, as he explains that both of these issues are incredibly complicated problems that require thoughtful, carefully calculated solutions. "Green investment is certainly a remedy for hard times," he adds, "but it may not be a cure."

Yudelson's analysis of the impact of green investment and green job creation is contained in a new white paper "Green Jobs: Separating Hype from Reality," published by his firm, Yudelson Associates, and co-authored with Jaime Galayda, Ph.D. The report investigates the job definitions, growth forecasts, and investment projections that paint a more complete picture of the relationship between green jobs, government action to address climate change, and the health of the nation's economy.

In order to separate hype from reality, the authors first attempt to clarify the definition of what constitutes a "green economy" job. They quote Van Jones, special adviser to the White House Council on Environmental Quality and author, who posits that these are either jobs related to blue-collar employment that has been upgraded to better respect the environment or family-supporting, career track, vocational or trade-level employment in environmentally friendly fields.

Examples of these types of jobs would include solar panel and solar hot water installers, farmers engaged in biofuel production, renewable energy power station technicians, and construction workers who build energy-efficient buildings.

But how many of these jobs can be tied to economic recovery? According to the Yudelson white paper, green employment in the United States will be turbocharged by the passage of The American Recovery & Reinvestment Act, a.k.a. the "stimulus package," in February, 2009. The bill provides $75 billion for energy efficiency, renewable energy, and the smart grid. In addition, the Obama administration's 2010 budget includes significant revenues from proposed carbon cap-and-trade rules, with as much as $150 billion in carbon reduction revenues targeted for clean energy programs and tax incentives by 2018.

The Center for American Progress and the Political Economy Research Institute at the University of Massachusetts estimate that $100 billion invested in green economic recovery programs over the next two years could create 2 million green jobs in renewable energy, advanced biofuels, smart grid improvements, expanding mass transit and freight rail lines, and energy efficient building retrofits.

But this new employment will only partially offset the loss of 5 million jobs already suffered in the nation's recession.

"What's really at issue here is how we can invest productively to create the maximum number of new jobs." Yudelson suggests that retrofitting existing buildings for energy efficiency is the best place to start, because reductions in energy costs will have a more immediate effect than investments in renewable energy. As far as he's concerned, "that's job one in the current economic downturn."

CHEMICAL INDUSTRY IS A KEYSTONE OF THE US ECOMONY

by Reed Miller, Industrial Heating
June 7, 2007

A newly released international report indicates that 2006 revenues for the Industrial Process Furnace and Oven Manufacturing Industry in the U.S. were approximately $1.96 billion. The gross profit was 25.5% - just under $500 million. It was a very good year to be in this business.

With this many furnaces being manufactured, it’s no wonder people are concerned about efficiencies with the prices of oil and natural gas at historically high levels. For many of the same reasons mentioned in our October 2006 editorial, long-term fundamentals continue to suggest that natural gas prices will remain relatively high and gradually increase. It was a warmer than average winter overall with demand about 3% lower than an average heating season. It was the third coldest February on record, however, resulting in a 6% higher February demand. In most of the U.S., it was also the coldest April in the last 10 years.

Future uncertainty always creates anxiety in this market. Will the summer be warmer than normal, and/or will it be an active hurricane season? Either will result in higher natural gas prices.

With energy costs at historic highs, a new paradigm has emerged. Labor once was the highest component in manufacturing costs and energy was the lowest. This has turned completely around, and discerning purchasers of this equipment are aggressively seeking ways to keep the energy production-cost component as low as possible.

Another recently concluded study conducted by Clear Seas Research for Industrial Heating sheds some additional light on the subject. Fully 96% of the burner-survey respondents indicate that natural gas is used to heat some or all of their process furnaces. Most furnaces (59%) were used for heat treatment.

When it comes to investing in furnace systems, 48% of survey respondents listed “energy savings” as a key factor while 41% chose fuel savings. Related to fuel savings, 13% of respondents gave “emissions reductions” as a key reason to invest in the next two years.

Perhaps not surprisingly, 64% of respondents to the burner survey listed “efficiency” as the most important characteristic they look at when purchasing a new burner. It’s no wonder that industry groups such as the Gas Technology Institute (GTI) utilize their resources to research ways to increase combustion efficiency in a variety of applications. GTI employs a staff of over 250 – 15% of whom hold Ph.D.s – many of whom are dedicated to improving process efficiencies.

Besides the obvious monthly cost savings associated with improving the efficiency of their process burners, many gas companies are offering rebates and incentives to customers who improve or replace qualifying lower-efficiency equipment. One example of this is The Gas Company in Southern California. More than $10 million in energy-efficiency rebates and incentives is available to its business customers in 2007. This money is divided between several different programs – more than one of which could apply to industrial customers making energy-efficiency improvements. Check with your natural gas company to see if you can take advantage of any similar incentives.

OHIO EPA SETS UP ONLINE EMISSION BANK

January 28, 2009

The Ohio Environmental Protection Agency introduced a new online voluntary emissions credit banking system recently to make it easier for companies to build or expand in Ohio counties that don't meet federal air quality standards, according to a Jan. 15 press release.

"The emissions bank can help buyers and sellers of emission credits connect quickly and easily, which is a big plus in today's fast-paced business environment," said Ohio EPA Director Chris Korleski. "We hope this will help foster economic activity in nonattainment areas, while still allowing us to improve air quality in these same areas."

The emissions banking system can be accessed on Ohio EPA's Web site at http://www.epa.state.oh.us/dapc/ERC/erc.html.

Under the Clean Air Act, a major emissions source cannot construct in a nonattainment area unless it obtains emission reduction credits, also known as emission offsets. For example, if a new facility wanted to locate in a nonattainment area and planned to emit 100 tons of carbon monoxide per year, it would need to obtain that amount of reductions (or credits) from another source. It can be time consuming and difficult for companies to find and verify available emission offsets. As a result, they often exclude nonattainment areas when considering where to locate a new facility.

Ohio must meet federal air quality standards for nitrogen oxide, volatile organic compounds (commonly referred to as VOCs), sulfur dioxide, fine particulates, carbon monoxide, and lead. Currently, 32 counties in Ohio do not meet federal standards for particulate matter and ozone. Ohio has submitted plans to U.S. EPA to lower pollution levels in nonattainment areas. Ohio EPA's goal is to bring these areas back into attainment, improving the areas' quality of life and the local economy.

http://www.eponline.com/print.aspx?aid=70545

EPA Pushes Ahead on GHG Standards

by Roy Bigham

Posted: December 23, 2010 The EPA issued its plan for establishing greenhouse gas (GHG) pollution standards under the Clean Air Act in 2011. The agency looked at a number of sectors and is moving forward on GHG standards for fossil fuel power plants and petroleum refineries – two of the largest industrial sources, representing nearly 40 percent of the GHG pollution in the United States. The schedule issued in the Dec. 23, 2010 agreements provides a clear path forward for these sectors and is part of EPA’s common-sense approach to addressing GHGs from the largest industrial pollution sources.

"We are following through on our commitment to proceed in a measured and careful way to reduce GHG pollution that threatens the health and welfare of Americans, and contributes to climate change," said Administrator Lisa Jackson. "These standards will help American companies attract private investment to the clean energy upgrades that make our companies more competitive and create good jobs here at home."

Several states, local governments and environmental organizations sued the EPA over the agency’s failure to update the pollution standards for fossil fuel power plants and petroleum refineries, two of the largest source categories of GHG pollution in the United States. Under today’s agreement, the EPA will propose standards for power plants in July 2011 and for refineries in December 2011 and will issue final standards in May 2012 and November 2012, respectively.

This schedule will allow the agency to host listening sessions with the business community, states and other stakeholders in early 2011, well before the rulemaking process begins, as well as to solicit additional feedback during the routine notice and comment period. Together this feedback will lead to smart, cost-effective and protective standards that reflect the latest and best information.

The Clean Air Act requires the EPA to set industry-specific standards for new sources that emit significant quantities of harmful pollutants. These standards, called New Source Performance Standards (NSPS), set the level of pollution new facilities may emit and address air pollution from existing facilities. The Act allows flexible and innovative approaches that take into account cost, health and environmental impacts, and energy requirements. The agency also must periodically update these standards to reflect improvements in control technologies.

Earlier this year, the EPA issued a common-sense approach to GHG permitting for the largest industrial sources. This approach, the GHG permitting guidelines issued in November, and these standards will give power plants and refineries a clear and sensible path for addressing GHG pollution.

The EPA will accept public comment on these two agreements for 30 days following publication of notice in the Federal Register. www.pollutionengineering.com

JAY SAYS

Dear Reader,

There are signs of economic recovery.

Dow tops its 2008 close; can it keep going?

Melt down. Since then, the Dow – and the entire US stock market - has basically shot up in a straight line. Stocks have risen at the fastest clip in the first 90 days after a bear market bottom since Depression -era 1930s.

The Dow’s 34.3% rally off its March 9 low erases the deep hold it dug for itself earlier in 2009 and put it back in positive territory for the first time since early January.

What changed? The get me out of this market trade that was in place all the way down- which Wall Street calls the “Depression II” trade - was abandoned as fears of a worst case economic outcome faded. The government’s ability to stabilize the economy and banking system has reduced record fear levels, setting the stage for revival in risk taking.

Melt up. Wall Street has put on a new, more optimistic trade, dubbed the “Recovery Trade.” It’s a bet on an economic rebound. It’s success has been driven in large part by the “green shoots” concept. This term was coined by Federal Reserve Chairman Ben Bernake to describe the early signs of a recovery that are gleaned from economic data that comes in less bad than expected.

source USA today

Best regards,
Jay Klaus
JKlaus@KlausEquipment.com
Klaus Equipment Company, Inc.
President