Tuesday, March 5, 2019

Wood stove industry faces unified opposition to deregulation

A 2018 portrait of the Western
Governors Association who
oppose delays in the NSPS timeline.

Amid the scores of comments filed in response to the EPA’s proposal to weaken Obama-era wood stove and boiler regulations, not a single state came out in support of the Trump Administration’s proposals.  

Attorney Generals from eleven states (CT, IL, MA, MD, MN, NJ, OR, NY, RI, VT & WA) filed detailed comments and are likely prepared to sue if the EPA tries to weaken the existing regulations.  Even Alaska and the Western Governors Association is backing the Obama-era timeline. A more troubling sign for the wood stove and boiler industry is an energized, engaged and knowledgeable array of states, air agencies and non-profit organizations that have lined up to oppose virtually all the changes that the stove and boiler industry is seeking from the Administration.

“We are seeing a polarization of stakeholders who once used to make alliances and find common ground,” said John Ackerly, President of the Alliance for Green Heat, an independent non-profit that promotes cleaner and more efficient wood and pellet heating. “The Trump Administration efforts has energized states and unified them across a range of issues, from compliance deadlines, to test methods, to regulation of wood pellet composition, to warranties and audits for stoves,” Ackerly said.

Key excerpts of stakeholder comments which this analysis is based on can be found here for those who don't want to download and read through hundreds of pages of comments.
John Ackerly, head of the Alliance
for Green Heat.  Photo courtesy of
Popular Mechanics magazine.

Trump Administration proposes a delay

The biggest issue on the table is whether the EPA will extend a deadline and allow retailers to sell dirtier wood boilers and furnaces – and possibly wood stoves – until 2022 instead of 2020. The EPA has indicated an interest to provide this relief to wood boiler and furnace manufacturers and retailers, but time is running is out and the agency has been moving slowly on this issue.  It’s also unclear if states would be able to get an injunction to prevent such a move while it was being litigated.  

Scores of comments submitted to the EPA depict an industry that has few friends standing up for it outside its own network of manufacturers and retailers.  Attorney generals from three states with Republican governors – Maryland, Massachusetts and Vermont – sided with democratic-led states in opposing any delay in stricter emission standards taking effect.  

Among industry, there is widespread unity to allow retailers two more years to sell Step 1 boilers, furnaces - and stoves - that are set to go off the market in May 2020, although a handful of small manufacturers and importers support the existing timeline.  

While manufacturers argue forcefully that they need a two-year sell-through, they are also having to assure their retailers that they will have 2020 compliant products.  For example, in comments submitted to the EPA, Jotul says it faces dire economic consequences with $2.5 million in raw cast iron at stake if a 2-year sell-through is not granted.  But in an industry magazine read by retailers, Jotul says they are doing “very well” certifying their 2020 models and expect to release their new 2020 models later this year.  Based on the EPA’s list of certified wood stoves, it appears that Jotul is one of the manufacturers who is far behind schedule, as they do not yet have a single 2020 compliant stove on the list.  Industry sources have said that the list of EPA certified stoves far underestimates the preparedness of many manufacturers who may be waiting to submit test data for 2020 compliant stoves until they are closer to the required date.
Richard Corey, CEO of
California's Air Resources
Board

While northeast and northwest states have been the principal state actors, California is making a big investment in challenging the EPA's deregulatory proposals.  They filed extensive comments to both the Proposed Rule Making (PRM) and the Advance Notice of Proposed Rule Making (ANPRM).  They and many of other states challenge the legality of the EPA's approach, setting the scene for what is likely to be a legal battle.  They argue:

"The [EPA's] requests for information with respect to the emission limit for wood heaters do not request the right information, are biased and outcome seeking towards collecting evidence for weakened standards and miss the opportunity to collect the data necessary to perform an accurate and complete economic and regulatory impact analysis.  Asking “whether Step 2 is achievable at a reasonable cost” is not the correct framing of the question. The answer to this question seems predetermined, particularly for those who ostensibly have “been unable to design a wood heater to meet the Step 2 standard.”
Letita James, the Attorney
General of New York, is the
lead among eleven attorney
generals opposing a sell-
through and other changes.

Perhaps the most detailed argument for a two-year sell-through came from North East Distributors, one of the largest distributors of stoves made by many manufacturers.  They say that they “are in favor of manufacturers having to meet the May 15, 2020 deadline for stopping production of non-2020 compliant models" but against "holding distributors and retailers to the same May 15, 2020 deadline for sales of already manufactured products. Having the one date for all entities (manufacturers, distributors, and retailers) inhibits the results you are trying to accomplish.” 

A push to deregulate outdoor wood boilers

The main regulatory focus has been on a sell-through for outdoor wood boilers, also known as hydronic heaters, and inexpensive indoor wood furnaces.  Leaders of those companies have been testifying to Congress and lobbying the administration. 

For central heaters like boilers and furnaces, the main industry association, the Hearth, Patio and Barbecue Association (HPBA) is calling on the EPA to “repeal those standards altogether.”  Strengthening emission standards for wood boilers and furnaces was one of the largest goals of the 2015 New Source Performance Standards (NSPS), and this call to deregulate that industry altogether represents a new front in the widening gulf between industry, states and air quality agencies.  

HPBA's John Crouch, an
architect and mediator of
HPBA policies.
US Stove, the dominant manufacturer of indoor wood furnaces is also calling on the EPA to repeal emission standards for furnaces because the “economic feasibility of meeting the standards is impractical” and the emission levels are “preposterous and unrealistic.”  However, a far smaller competitor, Lamppa Manufacturing already has a furnace that meets the 2020 standards.

When it comes to outdoor wood boilers, fringe voices are not uncommon. There is a group of retailers and consumers supporting the “Hawken Proposal”, which calls for getting rid of federal emission standards for outdoor boilers altogether and letting states and municipalities voluntarily adopt standards.  The proposal is being led by Hawken Energy, a Missouri based company that believes the federal government should not interfere with how people heat their homes. 

In contrast, Central Boiler took a more moderate position and refrained from calling on the EPA to repeal Step 1 and/or Step 2 standards, instead asking the agency to “revisit the cost effectiveness and feasibility of the Step 2 emission limit.”

Lack of enforcement undermines certified boilers
 
Warren Walborn, CEO of Hawken
Energy with Rep. Bill Huizenga (R-MI).
An important concern among the outdoor wood boiler community is that the EPA has no enforcement capability to rein in the many manufacturers of unregulated outdoor boilers.  Yoder Outdoor Furnace, a HeatMaster retailer in Virginia said, “until [EPA] enforcement actually happens no manufacturer can afford to invest heavily in testing as these cheap illegal models will not allow them to recoup costs.”  That sentiment was echoed in many comments from industry, and it would seem to be an issue of concern to states and air quality agencies as well.  However, states and air quality agencies did not mention this problem in their comments.  

By opening the door to changes in the compliance timeline for stricter emission standards, the EPA may have built far more momentum for a new NSPS process in 2023.  The NSPS is supposed to be reviewed every eight years, and states and groups are likely to sue again to keep the EPA to that timeline.  Virtually all the states and air quality agencies engaged in fighting EPA’s proposed changes are now calling for far-reaching changes in the 2023 NSPS. If a democrat is in the White House in 2023, this momentum may result in even stricter emission limits and test method changes.  A group of eleven Attorney Generals said the 2020 emission standards are already “too lax.” If President Trump is re-elected, industry is likely to keep the upper hand and consolidate its goals, barring defeats in court.
Lisa Rector, a leader at
NESCAUM on wood
smoke reduction.


In addition to seeking input on granting a two-year sell-through for retailers for boilers and furnaces, and possible stoves, the EPA identified a half a dozen other issues for which it wanted feedback, from cordwood test methods to compliance testing.

The transition to cord wood testing

One area on which industry, states, air quality agencies and other groups all agree is the need to move toward testing and certification that more closely represents in-field operating conditions and performance.  This means testing and certifying stoves with cordwood, instead of crib wood (2x4s and 4x4s), capturing start-up emissions and potentially making even more structural changes to how stoves are tested.  The agreement may end there, however, as states and air quality agencies have now coalesced behind a test protocol being developed by Northeast States for Coordinated Airshed Management (NESCAUM) and the New York State Energy and Research Development Authority (NYSERDA), called the Integrated Duty Cycle (IDC) method.  Industry is firmly behind the ASTM E3053 method that they developed through a consensus-based process from 2015 to 2018. 

VP Berger, one of Hearth &
Home Technologies senior
leaders on NSPS issues.
Neither side is proposing a rapid change to mandatory cord wood testing.  States and air quality agencies are looking to the next NSPS in 2023 to consolidate their positions and interests.  The State of Oregon, home to most of the test labs and the very first certification testing in the mid 1980s, submitted comments that were particularly critical of ASTM methods.  

Hearth & Home Technologies (HHT), whose comments were often more moderate than some of their peers, said, “HHT recommends using ASTM E3053 until such time there is data showing that the ASTM method doesn’t replicate real-world cord wood emissions or that a new Federal Reference Method is needed.” 

States want labs to start using TEOMs immediately

While states and air quality agencies say that they do not want to change the existing NSPS and believe that any changes to testing and emission standards should be taken up in the 2023 NSPS.  However, they are calling on EPA to “adopt a requirement now, to take immediate effect, for the concurrent use of a tapered element oscillating microbalance (TEOM) test method to measure real-time particulate matter (PM), using the NESCAUM Standard Operating Procedures.”  Such a requirement would seem to involve a change to the current NSPS, unless it were a voluntary measure that labs could undertake as part of a research effort outside of it.

Third-party certification of stoves 

Once stoves or boilers are tested by third party labs, those labs currently send the test reports to the EPA for review and then the EPA issues the certification allowing the manufacturer to make and sell the appliance.  

Industry urged the EPA to ask for comments about a change in this process, whereby the lab would test the appliance and grant the certification, bypassing review by the EPA. Industry points to delays and backlogs at the EPA enforcement office, which takes up to 90 days to grant certificates once the lab provides the necessary documentation.  
 EPA officials, including Amanda
Aldridge and Rochelle Boyd, listen
to testimony on Dec. 17, 2018
on proposals to revise the NSPS.

Again, states and air quality agencies have lined up to oppose this proposal, arguing that the same lab that is paid by the manufacturer to test the stove should not be paid by the manufacturer to issue the certification.  With cutbacks to EPA funding, it does not appear likely that the EPA would hire additional people to help streamline the certification process and at the same time provide other oversight and enforcement of the NSPS, such as cracking down on manufacturers of uncertified outdoor wood boilers. 

Compliance audit testing

Another topic on which the EPA solicited comments is how and when stoves could be retested and audited for emissions compliance.  Auditing the accuracy of the lab that did certification testing of a pellet stove is far easier, as the variability of emissions in pellet stoves is not nearly as great as in wood stoves.  Industry, led by HPBA and Central Boiler, took the position that an audit test should only happen “where there is suspected fraud in certification test results” not random spot checks.  HPBA took an even stronger position, saying that EPA should “prohibit audit testing for appliance categories until there has been a determination on variability for the applicable test.”
Blaze King's Chris Neufeld, an
ardent promoter of catalytic stoves.

Others in industry, such as Hearth & Home Technologies, took the position that if a stove is to be audited, it should be done by the same lab that tested it initially or another lab chosen by the manufacturer.  

States and air quality agencies are taking a uniform position that “only an independent, third-party lab should be selected to conduct all compliance audit testing so that there is consistency across the program and that a lab that conducts certification testing is not permitted to conduct audit testing.” NESCAUM proposed that Brookhaven National Lab be designed as the independent lab.

Warranty requirements

Currently, the NSPS has warranty requirements for catalytic stoves, but not for non-catalytic stoves.  The industry position is that the NSPS should not have any warranty requirements. Hearth & Home Technologies commented that “all manufacturers already have warranty language... [and] whether the EPA required it or not, it is standard warranty language for an appliance.”

This topic drew less attention from states and air agencies, but most supported the retention of warranty language for cat stoves and the addition of warranty requirements for non-cats, “particularly ones for key components related to controlling emissions from the device (including, among others, tubes).”  Blaze King, a vocal leader on this issue, agreed that if any type of stove is required to provide warranty language, then all stoves should have that requirement.   
Steve Muzzy, head of Central Boiler.


Different emission standards for pellet and cordwood appliances

Some industry players see a solution to emission standards by holding pellet appliances, and possibly also catalytic appliances, to a stricter standard.  Central Boiler charged that the EPA was “negligent” to hold stick wood and pellet appliances to the same emission standard.

HPBA and industry leader Hearth & Home Technologies are not calling for a bifurcation of emission standards based on fuel type or whether a stove has a catalyst.  The first NSPS in 1990 originally set a 7.5 gram an hour standard for non-cat stoves and a 4.1 standard for catalytic stoves.  States and air agencies also do not support setting separate emission levels based on fuel or inclusion of a catalyst.  Tim Ballo, an Earth Justice attorney, commented, “EPA’s observation that more pellet stoves meet the Step 2 standards than crib or cord wood stoves does not support the adoption of weaker emission standards for crib or cord wood-fired heating devices.”
Bret Watson says Jotul is
doing "very well" in
certifying their 2020 models.

In an exasperated and testy comment, Blaze King accused Jotul of working with the State of Maine to “spread false, misleading and out of date information in an effort to secure market share.”  Jotul has been a strong advocate for non-catalytic stoves and was instrumental in distributing a form letter to retailers to submit to the EPA that severely criticized catalytic technologies.  An unspoken rule in the stove industry is never to criticize another manufacturer by name, but the Blaze King feud with Jotul has only become more intense as the NSPS revision process increased the stakes of the game.  It should be noted that in Jotul’s official comments to the EPA, they did not call for a bifurcation of emission standards. 

A renewable, low carbon energy source

The role of wood and pellets as a renewable, low carbon fuel is virtually lost by the EPA, industry, states and air agencies.  Technically, the renewability of wood plays no legal role in setting emission regulations or other EPA policies governing wood and pellet heating.  However, many industry comments referred to the important role that wood heating plays in the lives of rural, lower income households, allowing them an affordable alternative to fossil fuel heating.  While it didn't appear in their comments, many of the states urging the EPA to maintain cleaner emission standards are also providing incentives for more deployment of wood and pellet heaters.  New York, Vermont, Massachusetts, Maryland and others all have programs aimed at strengthening modern wood heating.  The Alliance for Green Heat was founded to promote the role of biomass as a low carbon fuel source and has tried to gain industry support for innovation leading to the automation of wood stoves.  But for now, the sides have been drawn on this issue based mostly on affordability vs. cleanliness, not on carbon.

What comes next?

The EPA has said that it may make a decision on whether to grant wood boilers and furnaces a two-year sell through in the spring of 2019.  As for all the other issues, including a two-year sell-through for stoves, they have only issued an advance notice and still have to decide if they will issue a formal proposal.  That proposal would also be followed by a public comment period and it is difficult to imagine a scenario that the EPA could announce any “relief” for manufacturers before winter of 2019/2020.
Bill Wehrum, in charge of weakening
air pollution rules at the EPA for the
Trump Administration, has little time
to deliver on wood heaters.

Industry came close to securing a more robust compliance extension from Congress in 2018 but fell short in the Senate.  With Democrats now in charge of the House, Congressional support for weaker or delayed emission standards is not an option in 2019 or 2020.

Clearly, the attempt to dilute the NSPS by the Trump Administration has coalesced and unified states and air agencies behind positions developed by NESCAUM and others.  They are looking to 2023 to regain the ascendancy that they lost under Administrator Pruitt and Wheeler’s leadership at the EPA.  If democrats take the White House in 2022, rewriting the NSPS starting in 2023 could be a possibility.  But a democratic White House and EPA would, in turn, energize Republican governors who seem to have been complacent during this comment process.  Under Republican Governor LePage, Maine was the one state that was emerging as a vocal supporter of the EPA’s deregulation of wood appliances, but during the comment process, a Democratic Governor was elected.  

At this point, time is critical as May 2020 approaches. It appears that the issue was not important enough for the EPA to put on a faster track and members of Congress supporting the hearth industry were not able to change that.  With a little more than a year to go, the question is – is it too late anyway?


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