Federal Efforts To Control the Environmental and Health Effects of Synthetic Fuels Development

In response to a congressional request, GAO reviewed the federal role regarding the environmental and health effects of synthetic fuels projects.

The U.S. Synthetic Fuels Corporation (SFC) was established under the Energy Security Act to provide financial assistance to encourage private industry to undertake projects that produce synthetic fuels. The Environmental Protection Agency and the states use a permitting process to regulate hazardous emissions from synthetic fuels projects. SFC monitors this process to ensure that projects which it funds comply with environmental regulatory requirements. Because synthetic fuels is a new industry, further information is needed to identify potential harmful effects. Currently, there are no commercial-scale projects operating successfully in the United States which could provide extensive environmental and health data. Federal agencies have sponsored research on small-scale synthetic fuels projects which indicate that commercial-scale projects could emit toxic substances, some of which may be carcinogenic. GAO believes that data on the environmental and health effects of such emissions must be developed so that research needs and regulatory action can be determined. GAO noted that SFC has issued environmental monitoring plan guidelines that will require sponsors of projects which receive SFC funds to prepare quarterly and annual monitoring reports on project emissions.