NorthMet Project Greenhouse Gas and Climate Change Evaluation Report Prepared for PolyMet Mining Inc. June 2009 NorthMet Project Greenhouse Gas and Climate Change Evaluation Report Prepared for PolyMet Mining Inc. June 2009 4700 West 77 th Street Minneapolis, MN 55435 -4803 Phone: (952) 832 -2600 Fax: (952) 832 -2601 Climate Change Evaluation Report June 2009 Table of Contents 1.0 Introduction ...................................................................................................................................... 1 2.0 Cumulative Effects........................................................................................................................... 5 2.1. Background Information on Climate Change ............................................................................. 5 2.1.1. Climate Change and Greenhouse Gases in Federal and State Policy and Law .............. 5 2.1.1.1 Federal Policy and Law ................................................................................... 5 2.1.1.2 Minnesota State Policy and Law ................................................................... 10 2.1.2. The Science of Climate Change ................................................................................... 12 2.2. Proposed Project and Climate Change ...................................................................................... 44 2.2.1. Wetlands ...................................................................................................................... 46 2.2.2. Water Resources .......................................................................................................... 48 2.2.3. Air Quality ................................................................................................................... 49 2.2.4. Threatened, Endangered, and Special Concern Wildlife and Plants ............................ 52 2.2.5. Cover Types and Carbon Cycle Impacts ...................................................................... 53 2.2.5.1 Background ................................................................................................... 54 2.2.5.2 Project Impacts on Cover Types ................................................................... 56 2.2.5.3 Planned Restoration Activities ...................................................................... 58 3.0 Project Alternatives ........................................................................................................................ 61 3.1. Carbon Footprint for Proposed Project ..................................................................................... 61 3.1.1. Direct and Indirect Industrial Emission Impacts .......................................................... 61 3.1.2. Terrestrial Carbon Cycle Impacts ................................................................................ 62 3.2. Changes in Carbon Footprint to Potential Alternative and Mitigation ..................................... 68 3.2.1. Tailings Basin Alternative ........................................................................................... 68 3.2.2. RA1 – No Long Term Water Treatment at Mine Site ................................................. 69 3.3. Alternatives Analysis: Hydrometallurgical vs. Pyrometallurgical Processing ......................... 70 3.3.1. Comparison of Energy Usage ...................................................................................... 70 3.3.2. Comparison of Carbon Intensity .................................................................................. 70 3.4. Conclusions ............................................................................................................................... 72 4.0 Greenhouse Gas Reductions .......................................................................................................... 75 4.1. Project greenhouse gas reduction measures .............................................................................. 75 4.2. Alternative greenhouse gas reduction measures ....................................................................... 76 4.2.1. Biological carbon sequestration ................................................................................... 76 4.2.1.1 Afforestation.................................................................................................. 76 i P:\Mpls\23 MN\69\2369862\WorkFiles\WO 009 Air\CO2 Footprint\June 09 Report\Final Report\PolyMet Climate Change Evaluation Draft- 02.doc 4.2.1.2 Wetland Sequestration ................................................................................... 77 4.2.1.3 Perennial Grassland ....................................................................................... 77 4.2.2. Carbon offset credits .................................................................................................... 78 4.3. Conclusions ............................................................................................................................... 78 ii List of Tables Table 1 Project Greenhouse Gas (GHG) Emission Summary ........................................................... 61 Table 2 Wetlands Carbon Cycle Impacts Summary .......................................................................... 64 Table 3 Forest Carbon Cycle Impacts Summary ............................................................................... 66 Table 4 Carbon Cycle Impacts Summary ......................................................................................... 67 List of Appendices Appendix A Greenhouse Gas Emissions Inventory and Alternatives Report Appendix B Website References Used in This Report Appendix C Responses to Agency Comments on March 2009 NorthMet Project Greenhouse Gas and Climate Change Evaluation Report iii 1.0 Introduction The first draft of this report was submitted in March of 2009. Comments on the first draft were received from the Minnesota Pollution Control Agency (MPCA) and the Minnesota Department of Natural Resources (MDNR). This second draft of the report is being submitted to address the comments. The agency comments along with a brief description of how they have been addressed are included in Appendix C. The issue of climate change and anthropogenic greenhouse gas emissions is a complex and evolving topic from both a scientific and regulatory standpoint. The NorthMet Project Draft EIS is being prepared in the context of new and evolving state and federal guidance related to greenhouse gases and climate change in environmental review. The analysis that follows addresses the environmental effects of greenhouse gas emissions from the NorthMet Project and of global climate change. The analysis also recognizes data and analytical limitations. Greenhouse gases and climate change are evaluated in a manner that is consistent with available, reliable, scientifically-based information and approaches. Project greenhouse gas emissions, alternatives, and energy efficiency have been quantitatively assessed. Additionally, despite the high level of uncertainty associated with their calculation, greenhouse gas emissions from surface wetland removal and stockpiling, loss of aboveground biomass carbon in impacted areas, and reductions in carbon sequestration capacity due to wetland and upland forest ground cover disturbance have been quantitatively assessed. Given the limitations of climate models in addressing the impacts of greenhouse gas emissions at the project level on global, national, regional, and local climate, this impact analysis is largely qualitative in its treatment of the physical climate endpoints (e.g., temperature rise, frequency of precipitation events). Greenhouse gas emissions from the NorthMet Project are not currently subject to any emissions limits imposed by federal, state, or local laws. Climate change policy and greenhouse gas regulation is a rapidly evolving issue, however. Environmental Protection Agency (EPA) has recently been authorized to regulate CO 2 emissions from mobile sources under the Clean Air Act (CAA), and the MPCA now requires an evaluation of greenhouse gas emissions in the environmental review process for proposers of projects that must obtain stationary source air permits. In addition, from the state level to the international level, many governments are setting goals and taking steps toward greenhouse gas emission reductions. While the earth’s climate naturally undergoes cyclical variations over time, increases in global average surface temperatures observed over recent decades have been attributed by many scientists to observed increases in global atmospheric greenhouse gas concentrations resulting from anthropogenic greenhouse 1 gas emissions. Some future climate change impacts have been projected to occur as the result of increases in global atmospheric greenhouse gas concentrations that have already occurred. The level of future global, national and regional anthropogenic greenhouse gas emissions may also exert a strong influence over the magnitude and extent of future climate change. Minnesota is situated in a unique location that makes it particularly vulnerable to the potential effects of climate change. Climate change impacts such as temperature increases, changes in precipitation patterns, and shifts in the length of Minnesota’s seasons could affect forest ecosystems, water resources, other unique ecosystems, agriculture, and human health over the next century. Major components of the NorthMet Project include mining, ore crushing/grinding and concentrating, and metal