Podcasts: July 28, 2014

A: We know where we’re at with the 2014 allocation, and we know it will be cut to zero in 2020, but we don’t know what the glide path for 2015, 2016, 2017, 2018, and 2019 will look like. The EPA [U.S. Environmental Protection Agency], at the end of 2013, released a proposal that included several options as to what that glide path could look like. They took comments through March 10, 2014, and will review those comments and likely finalize the allocation in the summer or early in the fall.

Q: Who’s pushing for what allocation amount?

A: The EPA would like, I think, to do a five-year drawdown — a straight-line drawdown — that drops the allocation the same amount year by year. In 2015 it would be approximately 14,000-15,000 metric tons until you get to zero in 2020. There is a lot of certainty to that as we all know what to expect. There are two alternates to that five-year drawdown. One option would incorporate a lower allocation over that five-year term, and another alternative would have a higher allocation, though the preferred method is the linear drawdown that would be approximately 41,000 metric tons over the five years. There is also a three-year drawdown that would lead to a lower allocation of about 25,000 metric tons over that time, and the phaseout would complete in 2018 and not 2020, which may be a bit of a shock to the market, leaving those two years on the table.

Charlie McCrudden
Senior vice president of government relations, ACCA
www.acca.org

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Publication date: 7/28/2014