1. AIR INNOVATIONS CONFERENCE August 11, 2004 FACILITATING SEPS

2. What Is A Supplemental Environmental Project?  Applied in the enforcement context  Voluntarily agreed to by the “violator”  Over and above what is legally required  Requires an environmental benefit  Must have a nexus with the violation  Results in penalty reduction

3. Specific SEP Policies  EPA has developed detailed SEP policies Must improve public health or the environment Must improve public health or the environment Cannot be inconsistent with underlying statute Cannot be inconsistent with underlying statute EPA cannot manage or control the SEP funds EPA cannot manage or control the SEP funds Type of project to be defined in the settlement Type of project to be defined in the settlement  www.epa.gov/compliance/civil/program/seps www.epa.gov/compliance/civil/program/seps  Many State agencies have developed their own policies, as well

4. SEPs from a “Violator’s” View  A SEP is one way of doing good, while reducing a penalty  SEPs require a nexus with the community affected by the violation, as such provide an opportunity for the violator to have a positive community impact

5. SEPs from an Agency’s View  Opportunity to obtain an environmental or public health risk benefit  Opportunity for innovative projects  Opportunity to achieve a project with minimal management/oversight costs  AN OPPORTUNITY FOR FUNDING

6. The StEPP Foundation  A national, 501(c)(3) not-for-profit  Established to identify viable clean energy, energy efficiency and pollution prevention projects meeting SEP criteria  “StEPP” stands for Strategic Environmental Project Pipeline  StEPP offers a turnkey solution for funding sources looking for viable projects

7. StEPP Foundation Services  Outreach to generate project ideas  Project identification and screening  Project management and oversight  Management of project monies  Accountability  Collection and reporting of environmental metrics for each project per dollar spent  Follow up, public relations, project promotion

8. The StEPP Process  Written project concepts are submitted online at a screening level of detail  Qualifying projects are available in the Project Pipeline  The Project Pipeline provides a selection of fundable projects  StEPP matches projects w/ negotiated criteria or provides a selection of projects

11. Second Phase of the Process  Once funding becomes available the applicant will be requested to submit a full proposal  Geographic location  Media/medium affected  Environmental category (e.g., REEE)  A committee made of a StEPP Board member, members of the community, experts will make its recommendation to the funding source  StEPP then manages the project thru completion

12. Results The result has been the funding of projects that directly benefit the communities around our facility – projects that we would not have had an opportunity to fund if it were not for the StEPP Foundation. I strongly recommend working with the StEPP Foundation Dennis Creamer, ConocoPhillips

13. REEE SEP Examples  A refiner in Colorado funded low interest home and small business loans for REEE  Energy supplier settled air violations & funded alternative energy projects including solar panel installations  Airport air violations settlement included replacement of traditional lights with energy efficient lighting

14. Other Examples  Solar panel installation for snow making at a ski area  Settlement funding into an escrow account used to pay for wind power over 5 years  University air violations resolution included improved insulation of campus buildings  CONTACT US: www.steppfoundation.org