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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--President Donald Trump's long-awaited move to roll back the signature environmental regulation of his predecessor came Tuesday when he signed a broad executive order that instructed the U.S. Environmental Protection Administration (EPA) (Washington, D.C.) to withdraw and rewrite the Clean Power Plan (CPP), currently being litigated in federal court. The order also yanked the Department of Interior's (DOI) (Washington, D.C.) plan to reassess the federal coal-leasing program and overturned several executive orders and presidential memoranda on climate change signed by then-President Barack Obama.
The March 28 order comes a little more than a week after the president released his budget blueprint for the federal government. That blueprint called for a 31% reduction in funding for the EPA, the largest percentage hit to any federal agency. Congress will make the final determination about EPA's budget.
The CPP, finalized in August 2015, was the first time the federal government sought to regulate carbon dioxide (CO2) emissions from power plants. That rule called for a 32% cut in CO2 emissions from existing power plants by 2030, compared to a 2005 baseline. That rule has been opposed by coal companies, some coal-burning utilities and numerous state attorneys general. For more on the rule, see August 5, 2015, article - Obama Unveils Final Clean Power Plan, But Will it Survive Court Challenge?
Oral arguments over the rule were held last September before the U.S. Court of Appeals for the D.C. Circuit. A decision was expected in the near future. The U.S. Supreme Court sent the case to that court in an unprecedented step last February. For more on that, see February 16, 2016, article - Unprecedented Stay by Supreme Court Casts Long Shadow Over Clean Power Plan. Shortly after that 5-4 court ruling, Supreme Court Associate Justice Antonin Scalia died. Scalia was a member of the court's majority in that decision, and his seat remains empty.
Trump said Tuesday that the "action I am taking today will eliminate federal overreach, restore economic freedom, and allow our companies and our workers to thrive, compete and succeed on a level playing field for the first time in a long time.
"We are going to continue to expand energy production and we will also create more jobs in infrastructure, trucking and manufacturing," he continued. "This will allow the EPA to focus on its primary mission of protecting our air and protecting our water. Together, we are going to start a new energy revolution, one that celebrates American production on American soil."
A senior White House source told reporters Monday night the actions will advance domestic energy independence, one of the promises Trump made on the campaign trail.
The official said the president believes humans are contributing to climate change, but that "there's a disagreement over the policy response." Added the source, "He's made a pledge to the coal industry and he's going to do whatever he can to help those workers."
Procedurally, the EPA must get permission from the D.C. Circuit court to revisit the CPP. Then, EPA officials must begin the process of building an administrative record that would justify its new stance on regulating CO2 emissions. That could take as long as the Obama EPA did to draft and revise the CPP. The Obama EPA argued reducing CO2 emissions from power plants was technically feasible using then-current technology as well as legally warranted.
During the multi-year process of drafting, revising and finalizing the CPP, coal producers and coal-burning utilities argued there were no commercially proven means to capture and store CO2 emissions. Earlier this year, the world's largest carbon-capture project was completed at a Texas power plant. For more on that, see January 17, 2017, article - NRG Completes World's Largest Carbon-Capture Project.
"So, for the president, even if he would like to revoke the Clean Power Plan, he doesn't have legal authority to do that," Jeffrey Holmstead, a partner at the Bracewell law firm who opposes the CPP, told The Washington Post. Holmstead, who headed the EPA's air and radiation office under President George W. Bush, said he thinks the agency can justify reversing the regulation. But "they have to justify why they have changed," he added.
The EPA-led process to revise the CPP will not include an effort to overturn a 2007 Supreme Court ruling that said greenhouse gases are air pollutants that are covered by the Clean Air Act. The court held that the EPA must determine whether emissions of greenhouse gases from new motor vehicles cause or contribute to air pollution which may endanger public health or welfare. In 2009, the EPA issued an "endangerment finding," which said CO2 and five other greenhouse gases were a threat.
Nor will Trump seek to withdraw the U.S. from last year's Paris Climate Accord, where most nations pledged to take steps to lower CO2 emissions to forestall rising climate concentrations of that gas, which scientists say traps heat and leads to changes in the Earth's climate.
The move to pull a reassessment of the federal coal leasing program had long been sought by miners. That reassessment, under way the last few years, could have changed the terms and conditions under which mining companies extract coal from federal lands. For more on that, see January 13, 2017, article - How Much Does Trump Dig Coal? DOI Plans to Modernize Coal-Lease Program May be an Early Test and February 19, 2016, article - Coal Groups Slam DOI Plan to Reassess Federal Coal-Leasing Program.
Some observers said the Trump measures could help revive coal as an electric generation fuel, at least in the short term, as the shift on the EPA could cause some utilities to rethink plans to close coal-fired generators. But there was widespread doubt that the moves would significantly improve coal-mining employment, as coal mining companies are expected to continue relying on automated drilling to extract the fuel.
In an interview with The New York Times, Robert W. Godby, an energy economist at the University of Wyoming, said keeping the older coal-fired generators running could bolster the coal market for up to a decade. But "the mines that are staying open are using more mechanization," he said. "They're not hiring people. So even if we saw an increase in coal production, we could see a decrease in coal jobs."
Regardless of the impact that a revised CPP could have on coal companies and coal-miner employment, the president's order does nothing to sow the shale gas revolution, which has led to plentiful supplies of gas at low prices, making fuel-switching an economic choice for many utilities.
President Trump's actions on Tuesday also included reversing executive orders and presidential memoranda from his predecessor that got the government deep into the fight against climate change. Trump rescinded climate change guidance from the Council on Environmental Quality and annulled Obama's finding on the social cost of carbon that was built into numerous government activities, often helping tip the balance in favor of renewable energy.
Obama's Climate Action Plan, which extended beyond electric utilities, also will be scrapped. In a briefing with reporters, an administrative source told reporters, "those orders simply don't reflect the president's priorities when it comes to dealing with climate change."
The order also will direct each federal agency to identify rules and policies that "serve as obstacles or impediments to domestic energy production," the White House aide said. Over about 180 days, agencies and the White House will review those submissions, and "those plans will serve as a blueprint for the administration going forward on energy policy."
Trump's moves were welcomed by industry groups and criticized by environmental organizations. "This rule was an unlawful attempt to radically transform the nation's power grid, destroying valuable energy assets and leaving our economy more vulnerable to rising power prices -- all for an insignificant environmental benefit," said Hal Quinn, president and chief executive of the National Mining Association (NMA) (Washington, D.C.).
Former EPA Administrator Gina McCarthy had a distinctly different view. In a statement, she said, "The administration's 'Back to the Future' environmental policy might be funny if it were a movie, but it's real life. They want us to travel back to when smokestacks damaged our health and polluted our air, instead of taking every opportunity to support clean jobs of the future. This is not just dangerous; it's embarrassing to us and our businesses on a global scale to be dismissing opportunities for new technologies, economic growth and U.S. leadership."
Britt Burt, Industrial Info's vice president of research for the Global Power Industry, had this observation: "Killing the Clean Power Plan won't be as easy as waving a magic wand to make it go away. We can expect to see significant legal challenges going forward that could drag on for years. Ironically, we are well on track to meeting the goal of the Clean Power Plan because of all the coal plant closures we have seen since 2010, coupled with an aggressive build-out of renewable energy sources, energy efficiency and replacing coal plants with natural gas-fired generation."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.
The March 28 order comes a little more than a week after the president released his budget blueprint for the federal government. That blueprint called for a 31% reduction in funding for the EPA, the largest percentage hit to any federal agency. Congress will make the final determination about EPA's budget.
The CPP, finalized in August 2015, was the first time the federal government sought to regulate carbon dioxide (CO2) emissions from power plants. That rule called for a 32% cut in CO2 emissions from existing power plants by 2030, compared to a 2005 baseline. That rule has been opposed by coal companies, some coal-burning utilities and numerous state attorneys general. For more on the rule, see August 5, 2015, article - Obama Unveils Final Clean Power Plan, But Will it Survive Court Challenge?
Oral arguments over the rule were held last September before the U.S. Court of Appeals for the D.C. Circuit. A decision was expected in the near future. The U.S. Supreme Court sent the case to that court in an unprecedented step last February. For more on that, see February 16, 2016, article - Unprecedented Stay by Supreme Court Casts Long Shadow Over Clean Power Plan. Shortly after that 5-4 court ruling, Supreme Court Associate Justice Antonin Scalia died. Scalia was a member of the court's majority in that decision, and his seat remains empty.
Trump said Tuesday that the "action I am taking today will eliminate federal overreach, restore economic freedom, and allow our companies and our workers to thrive, compete and succeed on a level playing field for the first time in a long time.
"We are going to continue to expand energy production and we will also create more jobs in infrastructure, trucking and manufacturing," he continued. "This will allow the EPA to focus on its primary mission of protecting our air and protecting our water. Together, we are going to start a new energy revolution, one that celebrates American production on American soil."
A senior White House source told reporters Monday night the actions will advance domestic energy independence, one of the promises Trump made on the campaign trail.
The official said the president believes humans are contributing to climate change, but that "there's a disagreement over the policy response." Added the source, "He's made a pledge to the coal industry and he's going to do whatever he can to help those workers."
Procedurally, the EPA must get permission from the D.C. Circuit court to revisit the CPP. Then, EPA officials must begin the process of building an administrative record that would justify its new stance on regulating CO2 emissions. That could take as long as the Obama EPA did to draft and revise the CPP. The Obama EPA argued reducing CO2 emissions from power plants was technically feasible using then-current technology as well as legally warranted.
During the multi-year process of drafting, revising and finalizing the CPP, coal producers and coal-burning utilities argued there were no commercially proven means to capture and store CO2 emissions. Earlier this year, the world's largest carbon-capture project was completed at a Texas power plant. For more on that, see January 17, 2017, article - NRG Completes World's Largest Carbon-Capture Project.
"So, for the president, even if he would like to revoke the Clean Power Plan, he doesn't have legal authority to do that," Jeffrey Holmstead, a partner at the Bracewell law firm who opposes the CPP, told The Washington Post. Holmstead, who headed the EPA's air and radiation office under President George W. Bush, said he thinks the agency can justify reversing the regulation. But "they have to justify why they have changed," he added.
The EPA-led process to revise the CPP will not include an effort to overturn a 2007 Supreme Court ruling that said greenhouse gases are air pollutants that are covered by the Clean Air Act. The court held that the EPA must determine whether emissions of greenhouse gases from new motor vehicles cause or contribute to air pollution which may endanger public health or welfare. In 2009, the EPA issued an "endangerment finding," which said CO2 and five other greenhouse gases were a threat.
Nor will Trump seek to withdraw the U.S. from last year's Paris Climate Accord, where most nations pledged to take steps to lower CO2 emissions to forestall rising climate concentrations of that gas, which scientists say traps heat and leads to changes in the Earth's climate.
The move to pull a reassessment of the federal coal leasing program had long been sought by miners. That reassessment, under way the last few years, could have changed the terms and conditions under which mining companies extract coal from federal lands. For more on that, see January 13, 2017, article - How Much Does Trump Dig Coal? DOI Plans to Modernize Coal-Lease Program May be an Early Test and February 19, 2016, article - Coal Groups Slam DOI Plan to Reassess Federal Coal-Leasing Program.
Some observers said the Trump measures could help revive coal as an electric generation fuel, at least in the short term, as the shift on the EPA could cause some utilities to rethink plans to close coal-fired generators. But there was widespread doubt that the moves would significantly improve coal-mining employment, as coal mining companies are expected to continue relying on automated drilling to extract the fuel.
In an interview with The New York Times, Robert W. Godby, an energy economist at the University of Wyoming, said keeping the older coal-fired generators running could bolster the coal market for up to a decade. But "the mines that are staying open are using more mechanization," he said. "They're not hiring people. So even if we saw an increase in coal production, we could see a decrease in coal jobs."
Regardless of the impact that a revised CPP could have on coal companies and coal-miner employment, the president's order does nothing to sow the shale gas revolution, which has led to plentiful supplies of gas at low prices, making fuel-switching an economic choice for many utilities.
President Trump's actions on Tuesday also included reversing executive orders and presidential memoranda from his predecessor that got the government deep into the fight against climate change. Trump rescinded climate change guidance from the Council on Environmental Quality and annulled Obama's finding on the social cost of carbon that was built into numerous government activities, often helping tip the balance in favor of renewable energy.
Obama's Climate Action Plan, which extended beyond electric utilities, also will be scrapped. In a briefing with reporters, an administrative source told reporters, "those orders simply don't reflect the president's priorities when it comes to dealing with climate change."
The order also will direct each federal agency to identify rules and policies that "serve as obstacles or impediments to domestic energy production," the White House aide said. Over about 180 days, agencies and the White House will review those submissions, and "those plans will serve as a blueprint for the administration going forward on energy policy."
Trump's moves were welcomed by industry groups and criticized by environmental organizations. "This rule was an unlawful attempt to radically transform the nation's power grid, destroying valuable energy assets and leaving our economy more vulnerable to rising power prices -- all for an insignificant environmental benefit," said Hal Quinn, president and chief executive of the National Mining Association (NMA) (Washington, D.C.).
Former EPA Administrator Gina McCarthy had a distinctly different view. In a statement, she said, "The administration's 'Back to the Future' environmental policy might be funny if it were a movie, but it's real life. They want us to travel back to when smokestacks damaged our health and polluted our air, instead of taking every opportunity to support clean jobs of the future. This is not just dangerous; it's embarrassing to us and our businesses on a global scale to be dismissing opportunities for new technologies, economic growth and U.S. leadership."
Britt Burt, Industrial Info's vice president of research for the Global Power Industry, had this observation: "Killing the Clean Power Plan won't be as easy as waving a magic wand to make it go away. We can expect to see significant legal challenges going forward that could drag on for years. Ironically, we are well on track to meeting the goal of the Clean Power Plan because of all the coal plant closures we have seen since 2010, coupled with an aggressive build-out of renewable energy sources, energy efficiency and replacing coal plants with natural gas-fired generation."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.
