The American Materials Manufacturing Alliance (AMMA), a group of energy-intensive, trade-exposed industries (EITEs) in the US, including the American Iron and Steel Institute (AISI) among other trade groups, have expressed their concern about an analysis by the US Environmental Protection Agency (EPA) to Congress in a written letter.
AISI informed the public on Thursday that together with other AMMA members, it has issued a letter to Senators Bayh (D-IN), Specter (D-PA), Brown (D-OH), McCaskill (D-MO) ad Stabenow (D-MI) regarding the EPA's analysis of the impact that H.R. 2454 will have on EITEs (The Effects of H.R. 2454 on International Competitiveness and Emissions Leakage in Energy-Intensive, Trade-Exposed Industries, also known as the "Interagency Analysis"). The EPA's analysis discusses plans to offset any cost impacts to EITEs, such as the steel industry, that may result from a federal policy to curb greenhouse gas (GHG) emissions from EITEs. Such federal climate legislation has not yet been put in place, but may result from the EPA's endangerment finding announced earlier this week, which states that GHGs are a hazard to public welfare.
In the letter, AISI and the other trade groups that comprise AMMA say they question the plausibility of the assumptions used in the study, and that such flawed assumptions could likely lead the Administration to the flawed conclusion that any EITE cost impacts resulting from climate policy are eliminated by H.R. 2454's emission allocation provisions.
AMMA observes that "The Interagency Analsysis recognizes the challenges of implementing such a complex emissions trading program have not yet been ‘fully considered'...enormous work is still needed to devise an allocation distribution system that does not unfairly penalize competitive manufacturers and result in production migration within and outside of the US. The potential for a system to unfairly create ‘winners and losers' in the marketplace must be avoided at all costs."
AMMA says it looks forward to working with the Administration and Congress to make sure climate policy does not negatively impact the competitiveness of domestic manufacturers.
The full letter can be found at AISI's website: www.steel.org.