Infrastructure Bill Includes Provisions Important to Chemical and Agriculture Sectors
On November 8, 2021, the Infrastructure Investment and Jobs Act (H.R. 3684) was presented to President Joseph Biden (D) for signature. The House passed the bill on November 5, 2021, by a vote of 228 to 206, and the Senate passed the bill on August 10, 2021, by a vote of 69 to 30. The bill contains many important provisions. We highlight below some of the provisions in the 1,039-page bill that we believe our clients and friends may find interesting.
Under the bill, the Secretary of Transportation will establish a program to provide grants to eligible entities to carry out activities to benefit pollinators on roadsides and highway rights-of-way. This includes invasive plant elimination and integrated vegetation management programs that include “targeted and judicious use of herbicides” to address weed issues and “any other pollinator-friendly practices the Secretary determines to be appropriate.” The bill will make available $200 million for the U.S. Department of the Interior (DOI) and the U.S. Department of Agriculture (USDA) for invasive species detection, prevention, and eradication, including conducting research and providing resources to facilitate detection of invasive species at points of entry and awarding grants for eradication of invasive species on non-federal land and on federal land. The bill requires the development and availability of best practices, and a priority ranking of pollinator-friendly practices on roadsides and highway rights-of-way. The bill also establishes forest management activities that are intended to prevent and minimize the damage from wildfires to include application of pesticides, biopesticides, or herbicides.
The bill includes $100 million for pollution prevention activities and grants, $20 million per fiscal year (FY) beginning in 2022 (until expended) through FY 2026. The U.S. Environmental Protection Agency’s (EPA) November 6, 2021, fact sheet states that this means that “[m]ore businesses will be able to get assistance to reduce toxic pollutants, cut water usage, improve efficiency, and lower costs, which will improve their operations while better protecting the communities in which they operate.”
Climate and the Chemical Industry
The bill includes numerous requirements and initiatives focused on “industrial carbon dioxide facilities.” The bill’s definition of industrial carbon dioxide facility includes facilities that emit carbon dioxide, including from any fugitive emissions source, that is created as a result of, among other activities, any manufacturing industry relating to chemicals, fertilizers, glass, steel, petroleum residues, forest products, agriculture, including feedlots and dairy operations, and transportation grade liquid fuels.
Save Our Seas -- Plastic Waste and Recycling
The bill will provide $275 million for grants under the Save Our Seas 2.0 Act, $55 million per FY beginning in 2022 (until expended) through FY 2026. The bill includes $75 million for grants focused on improving material recycling, recovery, management, and reduction, $15 million per FY (until expended) beginning in FY 2022 through FY 2026. The bill also includes $750 million for advanced energy manufacturing and recycling programs.
Smart Manufacturing and Sustainable Manufacturing
The bill includes programs, initiatives, grants, and other activities in support of manufacturer efforts to evaluate the facilities, services, and manufacturing operations of plant sites, and to identify opportunities for potential savings by manufacturer plant sites from energy efficiency improvements, waste minimization, pollution prevention, and productivity improvement. The bill will provide funding to advanced battery material research to understand and support efforts for advanced battery manufacture, including raw and processed forms of a mineral, metal, chemical, or other material used in an advanced battery component. The bill defines “smart manufacturing” to mean advanced technologies in information, automation, monitoring, computation, sensing, modeling, artificial intelligence, analytics, and networking that:
Simulate manufacturing production lines;
Operate computer-controlled manufacturing equipment;
Monitor and communicate production line status; and
Manage and optimize energy productivity and cost throughout production;
Model, simulate, and optimize the energy efficiency of a factory building;
Monitor and optimize building energy performance;
Model, simulate, and optimize the design of energy efficient and sustainable products, including the use of digital prototyping and additive manufacturing to enhance product design;
Connect manufactured products in networks to monitor and optimize the performance of the networks, including automated network operations; and
Digitally connect the supply chain network.
Under sustainable manufacturing, the Department of Energy (DOE), at the request of a manufacturer, will carry out onsite technical assessments to identify opportunities for:
Maximizing the energy efficiency of industrial processes and cross-cutting systems;
Preventing pollution and minimizing waste;
Improving efficient use of water in manufacturing processes;
Conserving natural resources; and
Achieving such other goals as the Secretary determines to be appropriate.
Under the bill, DOE shall carry out a joint industry-government partnership program to research, develop, and demonstrate new sustainable manufacturing and industrial technologies and processes that maximize the energy efficiency of industrial plants, reduce pollution, and conserve natural resources. The bill also calls for the establishment of industrial research and assessment centers at institutions of higher education to provide in-depth assessments of small- and medium-sized manufacturer plant sites to evaluate the facilities, services, and manufacturing operations of the plant sites to identify opportunities for optimizing energy efficiency and environmental performance, including implementation of smart manufacturing; energy management systems; sustainable manufacturing; information technology advancements for supply chain analysis, logistics, system monitoring, industrial and manufacturing processes, and other purposes; and waste management systems. These industrial research and assessment centers will promote applications of emerging concepts and technologies, as well as research and development for the use of alternative energy sources to supply heat, power, and new feedstocks for energy-intensive industries, among other activities.
Per- and Polyfluoroalkyl Substances (PFAS)
Through the funding of several types of clean water and drinking water grant and revolving fund programs, EPA will work to support states and local communities to provide safe drinking water. EPA states in its fact sheet that “[p]eople will be protected from PFAS or ‘forever chemical’ contamination.” The funding includes the following:
PFAS Clean Water State Revolving Fund (SRF): $1 billion;
PFAS Drinking Water SRF: $4 billion; and
PFAS Small and Disadvantaged: $5 billion.
The bill will add $3.5 billion to the Superfund Trust Fund for all costs associated with Superfund remedial activities. The bill calls for EPA to consider the unique needs of Tribal communities with contaminated sites where the potentially responsible parties cannot pay or cannot be identified (but shall not alter the process for prioritizing site cleanups). Further, as a revenue generator (over $14 billion) the bill will impose a Superfund tax on the following chemicals beginning in July 2022 and expiring at the end of 2031 (per ton):
Antimony trioxide 7.50
Arsenic trioxide 6.82
Barium sulfide 4.60
Potassium dichromate 3.38
Sodium dichromate 3.74
Cupric sulfate 3.74
Cupric oxide 7.18
Cuprous oxide 7.94
Hydrochloric acid 0.58
Hydrogen fluoride 8.46
Lead oxide 8.28
Stannous chloride 5.70
Stannic chloride 4.24
Zinc chloride 4.44
Zinc sulfate 3.80
Potassium hydroxide 0.44
Sodium hydroxide 0.56
Sulfuric acid 0.52
Nitric acid 0.48
Weatherization Assistance and Energy Efficiency and Conservation
The bill provides $3.5 billion for weatherization assistance programs in commercial buildings and multifamily housing and additional funds for financing energy efficiency, renewable energy, and zero-emission transportation and associated infrastructure, including $550 million for energy efficiency and conservation block grants, $1 billion for the Federal Emergency Management Agency (FEMA) building resilient infrastructure and communities, and $500 million for energy efficiency at public schools. These programs may include loan programs and performance contracting programs, for leveraging of additional public and private sector funds, and programs that allow rebates, grants, or other incentives for the purchase and installation of energy efficiency, renewable energy, and zero-emission transportation (and associated infrastructure) measures.
Make Personal Protective Equipment (PPE) in America
The bill will establish a long-term U.S. investment strategy for the domestic production of PPE items critical to the U.S. national response to a public health crisis, including the COVID-19 pandemic. These PPE items include surgical masks, respirator masks and powered air purifying respirators and required filters, face shields and protective eyewear, gloves, disposable and reusable surgical and isolation gowns, head and foot coverings, and other gear or clothing used to protect an individual from the transmission of disease. Under the bill, the Office of Management and Budget (OMB) shall submit to Congress a report on the procurement of PPE, including the U.S. long-term domestic procurement strategy for PPE produced in the United States, including strategies to incentivize investment in and maintain U.S. supply chains for all PPE sufficient to meet the needs of the United States during a public health emergency, an estimate of long-term demand quantities for all PPE items procured by the United States, and recommendations for Congressional action required to implement the U.S. government’s procurement strategy.
Passing and enacting the Infrastructure Investment and Jobs Act is without question a landmark bipartisan achievement for modernizing infrastructure in the U.S. The $1.2 trillion, 1,039-page Act includes hundreds of new programs and initiatives with significant investments that touch almost every aspect of the U.S. economy. Fully understanding the implications for the chemical and agricultural sectors will take time and indeed many aspects of the Act will take years to implement and longer to see meaningful results. Investment in sustainable manufacturing, pollution prevention, climate change resilience, environmental remediation, even PPE policy, will have consequences for the chemical and agriculture industries, as well as manufacturing writ large. Bergeson & Campbell, P.C. will continue to provide in-depth analysis and identify opportunities moving forward.