Statement: Proposed Rule for Deferral of CO2 Emissions from Bioenergy and Other Biogenic Sources under the PSD and Title V Programs

EPA Public Hearing
April 5, 2011
Statement by David P. Tenny
President and CEO
National Alliance of Forest Owners

Thank you for the opportunity to participate in today’s forum.  My name is Dave Tenny, and I am President and CEO of the National Alliance of Forest Owners or NAFO.  NAFO’s members represent nearly 80 million acres of private, working forests nationwide, enough acres to comprise the 5th largest state in the country. Combined, private forests contribute 2.5 million jobs, $187 billion in annual payroll and $115 billion to our nation’s annual GDP.

NAFO strongly supports the actions taken by EPA to defer the regulation of biomass greenhouse gas emissions under the Tailoring Rule and to provide guidance to states identifying biomass as Best Available Control Technology pending completion of the recently proposed deferral rule. These are appropriate steps toward capturing the total greenhouse gas benefits of using biomass energy as a renewable  alternative to fossil fuels.

All agencies of government have consistently recognized that biomass is an energy source that does not increase overall carbon in the atmosphere. We strongly urge EPA to continue this longstanding approach in future policy decisions.

Forests and markets have a long and mutually beneficial history in our country. During the 20th Century annual housing starts grew from 189,000 to 1.3 million and annual pulpwood consumption grew from 8 million to over 200 million tons. During this same period our nation’s total forest acreage remained constant, and during the second half of the century our total growing stocks increased by 50%. Today our forests sequester an estimated 800 million net tons of carbon annually or more than 80% of the carbon sequestered by all land uses.

Private forests and markets need each other to survive. New markets don’t reduce forests and forest carbon. They increase them.

Conversely, market loss puts economic pressure on private forests to convert to other more competitive land uses with fewer environmental benefits. EPA policy must capture the positive relationship between forests and markets in order to fully realize the carbon benefits of private forests.

EPA must act decisively and quickly to come into alignment with the renewable energy policy of this Administration. The deferral rule is a step in the right direction.  President Obama has stated that biomass energy is an important part of his renewable energy agenda. However, the Tailoring Rule contradicts the President and fails to recognize the carbon benefits of biomass energy notwithstanding EPA’s ample legal authority to do so. This frustrates the President’s agenda and casts a cloud of uncertainty in the biomass energy marketplace. EPA must clearly recognize the benefits of forest carbon in its policy to remove the uncertainty and advance the President’s renewable energy priorities.

NAFO has provided extensive comments to EPA outlining the legal and policy reasons for recognizing forest biomass as a carbon beneficial energy source, which are now part of the public record. NAFO will also submit written comments on the proposed deferral rule and participate in EPA’s forthcoming science and policy review of biomass carbon emissions. Today I will make five specific points to further inform the record.

First, forest carbon accounting systems are policy determinations, not scientific conclusions. The science of forest carbon has to do with the nature of the forest carbon cycle. Carbon accounting is a policy tool to help achieve policy objectives much like financial accounting is a tool to help achieve fiscal objectives. It is inappropriate to declare that an accounting assumption is a scientific principle.

Second, the EPA should measure forest carbon flux at the appropriate scale. Proposals to limit the accounting of forest carbon flux to confined areas and timeframes are arbitrary on their face. The forest carbon cycle is dynamic, global and ongoing. International conventions out of political and legal necessity often measure carbon flux at a national scale. EPA policy must follow this convention. Restricting forest carbon accounting to local areas or specific timeframes places arbitrary limits on forest carbon that distort the forest carbon picture. Some have used such parameters, for example, to declare that forest biomass combustion adds more overall carbon to the atmosphere than coal combustion.

Third, EPA policy must recognize the prevailing scientific conclusion that the forest carbon cycle is continuous and has no “beginning.”  Some suggest that the cycle “begins” at the time of harvest creating a “carbon debt” that must later be repaid. This approach is arbitrary on its face for two reasons.  First, it ignores the carbon removed from the atmosphere through tree growth prior to the time of harvest. Second, it ignores that the harvested stand is merely one small part of the total forested landscape that removes carbon from the atmosphere before, during, and after the time of harvest.

EPA policy must avoid arbitrarily declaring a “beginning” to the carbon cycle and, instead, measure changes in national carbon stocks at regular intervals to determine net carbon change.

Fourth, the EPA must avoid establishing arbitrary baselines, such as “business as usual,” to account for carbon emissions from biomass energy. Current forest practices yield significant and valuable increases in overall forest carbon sequestration that private forest owners provide without means of compensation. A “business as usual” baseline would arbitrarily “take” these benefits with no return benefit to the forest owner and introduce additional costs to forest management. Rather than promoting additional forest carbon sequestration, the resulting loss in forest value would create another economic incentive to convert forests to other uses. Encouraging stronger markets for forest products, like renewable energy, is a much more effective method to increase forest carbon sequestration than a regulatory taking.

Finally, EPA policy must recognize that net forest carbon change is not determined by the type of feedstock used to produce energy. All forest feedstocks are part of the same carbon cycle. Separate carbon cycles do not exist for different parts of a tree. Attempts to differentiate the carbon attributes of different types of forest feedstocks will yield arbitrary results that further confuse rather than clarify the nature of the forest carbon cycle.

Some are concerned that “whole trees” will be used for energy production citing a potential increase in forest carbon emissions. Because biomass for energy produces some of the lowest returns in the forest products value chain, there is little risk that forest owners will divert trees used for building materials and other high value products to low value biomass. Nevertheless, the EPA can effectively address any concern regarding the carbon impact of using one type of forest derived feedstock over another by focusing on net forest carbon change at the appropriate scale.

In conclusion, NAFO stands ready to work with the EPA to establish a policy recognizing the full carbon benefits of forest biomass as an energy source. We look forward to working with the agency to establish a policy that is consistent with the prevailing science on the forest carbon cycle, President Obama’s renewable energy objectives, and the historic positive relationship between private forests and the existing and emerging markets they serve. Thank you.