Is Confidential Business Information At Risk…Because of EPA’s GHG Reporting Rules?

Call me easily entranced, but have you been following the controversy surrounding the rules under the EPA’s greenhouse gas reporting program that address how certain submitted data will be treated with respect to confidentiality? I’m a bit late to the game for this particular issue, but a recently published Alert from Squire Sanders piqued my interest.

Photo by ivoryelephantphotography. Some rights reserved.

In July of 2010, the EPA published a proposed rule (and supplement) concerning confidentiality determinations for data required under the new GHG reporting rule. The proposal describes the different “categories” of data to be reported, and whether or not each category of data would ultimately be released to the public or withheld as confidential pursuant to Clean Air Act section 114(c) – codified at 42 USC 7414(c).

According to Squire Sanders, industry groups subject to the reporting requirements are up in a huff because, under the confidentiality determinations rules, “facilities could be forced to publicly disclose sensitive process information and trade secrets, including the nature and content of raw materials and total process throughputs.” Other reporting rules have used a case-by-case confidential business information (CBI) determination process, while the GHG reporting confidentiality rules provide no way for a given facility to challenge the confidentiality determinations.

Of course, with my limited industrial background, I was primarily interested in how the disclosure of information such as “total process throughputs” could actually put a business at a disadvantage. Probing the public comments for answers, I found many explanations like the following:

“Maintaining proprietary and process-specific data will disclose to our competitors critical information about evolving products, processes, technologies and applications. These competitors could then utilize this information to develop competing or the same products without the significant time and expense investment required to conduct their own research and development initiatives.”

and

“publicly disclosing the specific energy use for such a facility may allow competitors to gain unfair intelligence regarding production capabilities, utilization, and costs. Knowing this information could enable competitors to calculate the production output and relative cost of manufacture at a particular facility.”

Following the swift uproar (there have been about 100 related public comments so far), the EPA rushed to buy themselves (and reporting GHG emitters) some time. On December 27th, 2010, three concurrent EPA actions were released in the federal register in order to defer reporting of certain data elements under the GHG reporting program, while the EPA “obtains and reviews additional information to resolve issues related to reporting and public availability of these data elements.” You can read a fact sheet or FAQs about the deferral, or you can check out the full text of the proposed rule, interim final rule, and call for information. Comments on the proposed rule are due January 26, 2011, with a possible extension until February 10, 2011, and the call for information ends February 25, 2011.

One response to this post.

  1. […] exactly confidential business information (which raised quite a stir here) from various sectors will be treated under the GHG reporting program remains to be seen. You can […]

    Reply

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