S. 3836: Foreign Emissions and Nonattainment Clarification for Economic Stability Act

The proposed bill, known as the Foreign Emissions and Nonattainment Clarification for Economic Stability Act (FENCES Act), seeks to amend the Clean Air Act to adjust how emissions from outside the United States are treated regarding air quality standards. Here are the key components of the bill:

1. Clarification of Emissions

The bill clarifies that when considering emissions that impact air quality, it does not matter if those emissions result from human activity. This is significant because it recognizes that foreign emissions can influence air quality despite their source.

2. Nonattainment Areas

The legislation introduces provisions that would prevent a state from being designated as a nonattainment area (an area that does not meet air quality standards) for a pollutant if it can be shown that the area would meet the standards but for the emissions coming from outside the United States. This means that states would have a way to avoid penalties for air quality failures if they can effectively demonstrate the external cause of such shortcomings.

3. Sanctions and Fees

The bill states that for areas classified as "Severe" or "Extreme" for ozone, or "Serious" for particulate matter, no sanctions or fees will apply if the state can demonstrate that the failure to meet air quality standards is due to:

• Emissions originating from outside the nonattainment area.
• Emissions caused by exceptional events (as defined by existing regulations).
• Emissions from mobile sources that are beyond the control of the state to manage.

While certain sanctions or fees may not apply, the bill ensures that states are still obligated to implement necessary measures to meet air quality standards, and these responsibilities remain intact.

4. Renewal of Demonstrations

The bill mandates that states must renew their demonstration of compliance and the reasons for their nonattainment status at least once every five years in order to continue benefiting from these provisions.

In essence, the FENCES Act aims to provide states with more leeway in managing their air quality by considering foreign emissions as a factor influencing their compliance status, potentially shielding them from certain regulatory penalties.

Relevant Companies

• GE - General Electric may be impacted due to its involvement in energy production and related emissions, facing greater regulatory considerations regarding international emissions affecting U.S. air quality.
• PCG - Pacific Gas and Electric Company, being a major utility provider, might be affected if its operations are regarded in light of the emissions regulations and foreign pollution influences.