AD Main Menu

Alaska protests new low-sulfur fuel rules for big ships

Becky Bohrer

JUNEAU -- Alaska has sued to block enforcement of rules intended to limit pollution from large ships, saying the rules will result in higher freight rates and pricier cruises that will hurt the state's economy.

New rules set to take effect Aug. 1 will require that cargo carriers and cruise ships use a low-sulfur fuel within 200 miles of U.S. and Canadian shores. While the rules, initiated by the U.S. and agreed to by dozens of other nations as part of an international treaty, affect much of the North American coast and Hawaii, officials in Alaska say they will have a disproportionate effect on the state and want to keep them from being enforced in waters off Alaska's coast.

About 90 percent of the commodities entering Alaska are delivered through a single port -- the Port of Anchorage -- and many southeast Alaska communities rely heavily on revenues from the cruise trade to survive. The state, relying on industry estimates, said the rules could increase shipping costs to the state by 8 percent and cruise passenger costs up to $18 a day, potentially leading to a 15 percent decline in visitors. The lawsuit was filed July 13 in U.S. District Court in Anchorage.

The Republican members of the state's congressional delegation see the rules as an example of how out-of-touch with Alaska the U.S. Environmental Protection Agency, which proposed the rules, is. The president of the Alaska State Chamber of Commerce, Rachael Petro, said the rules will amount to a cost of living increase for all Alaskans, with companies passing their increased fuel costs onto consumers.

She said she knows of no documented pollution issues that would necessitate the new rules taking effect here. "It's completely unjustified," she said, "and that's disconcerting."

A cruise industry critic, Chip Thoma, dismissed as "made-up" the projected decline in cruise passenger numbers and said the state should be embracing the rules as the environmentally responsible thing to do.

Whit Sheard, Pacific counsel and senior advisor for the conservation group Oceana, called the state's decision to sue a "bit of a knee-jerk reaction." While balancing environmental protection and human health concerns and commerce can be delicate at times, he said the old maxim -- the "polluter pays" -- is how you deal with it.

Ships are large contributors to emissions from mobile sources in the U.S. and Canada, and most are foreign-flagged or registered elsewhere, according to EPA. With the new standards, set to become more stringent in 2015, emissions of nitrogen oxides, fine particulate matter and sulfur oxides are expected by 2020 to drop by 23 percent, 74 percent and 86 percent, respectively, below the levels predicted if the standards were not in effect, the agency said.

EPA said the impacts will be felt hundreds of miles inland and are expected to prevent thousands of premature deaths and relieve respiratory issues for nearly 5 million people a year in the U.S. and Canada. It estimates that by 2020, the overall cost of implementing the rules will be $3.2 billion while monetized health-related benefits could be as high as $110 billion in the U.S. alone.

Margo Oge, director of EPA's Office of Transportation and Air Quality, considers the program one of the most cost-effective the agency has ever designed.

Officials in California, home to two of the largest ports in the nation, say the new rules will be stepping up those the state voluntarily enacted on its own to reduce diesel emissions. A spokeswoman for that state's Air Resources Board said the steps have already paid off.

The rules were first proposed in 2007; since at least 2009, when EPA began working on regulations, the governor and members of the congressional delegation have pushed back against the plan.

Oge said EPA is aware of Alaska's concerns. EPA, which is working with the U.S. Coast Guard on the issue, said the agencies have some flexibility in implementing the rules and are working with cruise lines and one of Alaska's largest shipping companies, Totem Ocean Trailer Express, on alternatives that would allow them to still meet the emissions requirements. Totem declined comment for this article.

Jim Storey, spokesman for another major shipper, Horizon Lines, said the company, in response to the new rules, has already filed with the Surface Transportation Board to increase its fuel surcharge in the Alaska trade lane. He said Horizon vessels in Hawaii and Puerto Rico won't be affected because the company operates steamships in those trade lanes.

EPA also has released guidance, allowing for vessel owners or operators who cannot obtain the required low-sulfur fuel to make a "non-availability" claim. That means, if they cannot find the fuel, or the fuel doesn't work with their ships, they don't have to use the fuel -- but all that must be documented and the Coast Guard must be notified before the vessel reaches port.

Oge said the only areas where EPA is hearing about potential availability problems are Washington state and Alaska.

Seth Beausang, an assistant state attorney general, said the state is aware of that guidance but it doesn't change the fact the Emission Control Area -- the term given to the area in which the fuel standards apply -- "doesn't even belong up in Alaska."

The state contends EPA lacks the scientific basis and legal authority to extend the control area to Alaska. The state claims EPA relied on flawed or incomplete data, including a statement from a state employee that the state said attempted to draw a connection between purported lichen damage in Juneau and threats to a caribou herd located 1,000 miles away.

Sheard said talk about the lichen and caribou is a "side show," and doesn't diminish the main point of the rules: "This is what's right for the environment and human health considerations."

Only southern and southeastern Alaska fall under the new rules. EPA said it didn't have the information needed to apply them to the rest of the state. The Canadian Arctic also is exempt.


By BECKY BOHRER
Associated Press