President Donald Trump's Executive Order (EO) entitled "Promoting Energy Independence and Economic Growth" is a broad directive designed to accomplish a number of the Trump Administration's energy-related goals.
The EO, issued on March 28, 2017, is sweeping in nature, with a focus on encouraging domestic energy production by "unraveling the red tape" and initiating rollbacks on more than 30 Obama-era environmental documents and regulations. Its directives will take years to fully implement, particularly the regulatory rewrites that will be required to adhere to Administrative Procedures Act (APA) process.
Below is a section-by-section analysis of the Order.
This section of the EO establishes broad policy directives that set the Trump Administration's tone for energy-related policy. The order encourages "clean and safe development" of domestic energy resources, referencing, in this order: coal, natural gas, nuclear material, hydropower, and other domestic sources including renewables. The order also encourages agencies to take actions to promote clean air and clean water, while inserting a caveat that agencies must also respect "the proper roles of the Congress and the States" – echoing federalist environmental doctrine typical of Republican administrations. The order simultaneously discourages "regulatory burdens" that "unnecessarily encumber" energy production, and directs the review of existing regulations to this effect. This is fully fleshed out in Section 2.
The final paragraph under the policy section also directs the use of the "best available peer-reviewed science." This language dovetails with Republican efforts to reform the U.S. Environmental Protection Agency's (EPA) Science Advisory Board (SAB) and add greater transparency in future decision making. To date, the House has passed two bills on party lines related to the use of the "best available" science: H.R. 1430, the Honest and Open New EPA Science Treatment (HONEST) Act on March 29, 2017, and H.R. 1431, the EPA Science Advisory Board Reform Act on March 30, 2017.
Of note, the EO's only mention of national security or international policy asserts that "prudent development" of natural resources is essential to ensuring geopolitical security. Absent is any mention of the U.S. commitments to the Green Climate Fund or the Paris Agreement of 2015. Although Trump campaigned on promises to withdraw the United States from the Paris Agreement, White House Press Secretary Sean Spicer stated on March 30, 2017, that the Administration is still "reviewing" the agreement but expects to have a decision by the time of the upcoming G7 summit on May 26-27, 2017.1 A group of more than 1,000 companies – including Fortune 50 businesses such as HP and Johnson & Johnson – have signed a letter to the Administration and Congress calling on the government to continue U.S. participation in the Paris Agreement.2 Some within the business community support a withdrawal while others favor the long-term policy certainty the Agreement seeks to engineer and see business opportunities in the fulfillment of the Agreement.
Rep. Kevin Cramer (R-N.D.), who served as an energy advisor to President Trump's campaign, is currently circulating a "Dear Colleague" letter, which encourages the U.S. to remain a party to the Agreement rather than losing "its seat at the Paris table to defend and promote our commercial interests." The letter instead advocates for the U.S. to reduce its current commitment to reduce greenhouse gas (GHG) emissions by 26 percent to 28 percent by 2025 – a goal many say is infeasible without implementation of the Clean Power Plan – while also urging President Trump to follow through on his promise to end financial commitments to the Green Climate Fund. By exploring such a compromise, the Administration may find additional support from the business community.
This section directs the "heads of agencies" to review all agency actions that potentially burden the development or use of domestically produced energy resources, noting in particular fossil fuel and nuclear resources while omitting hydropower and other renewables. The section defines "burden" as "to unnecessarily obstruct, delay, curtail, or otherwise impose significant costs" on activities related to development of energy resources. Of note, Section 1 of the EO directs that "departments and agencies" review existing regulations and suspend, revise or rescind those that "unduly burden the development of domestic energy resources beyond the degree necessary to protect the public interest or otherwise comply with the law." While this section provides a definition of "burden," the meaning of "unduly" is left ambiguous, leaving portions of the Order particularly vulnerable to subjective interpretation and possible future legal challenges.
Indeed, several directives in the EO are similarly equivocal, leaving uncertain even basic questions regarding jurisdiction of the EO. It is not traditional that EOs apply to independent regulatory agencies such as the Federal Energy Regulatory Commission (FERC), U.S. Nuclear Regulatory Commission (NRC) or U.S. Securities and Exchange Commission (SEC). In keeping with this tradition, the interim guidance issued by the White House's Office of Information and Regulatory Affairs (OIRA) on President Trump's "Reducing Regulation and Controlling Regulatory Costs" EO exempted independent regulatory agencies. Similar clarification would be par for the course.
Substantively, Section 2 outlines the process by which agencies should carry out the review of these policies in three steps. This process is to be overseen by Office of Management and Budget (OMB) Director Mick Mulvaney and Assistant to the President for Economic Policy Ashley Hickey Marquis.
Several agencies have made progress on the implementation of this directive, despite the slow rate at which President Trump's political appointees are being confirmed for positions at the EPA, the Department of Energy (DOE) and the Department of the Interior (DOI). EPA has announced that Chief of Staff Ryan Jackson will chair the task force to review potentially burdensome regulations. Other members of the task force include Jackson's Deputy Chief of Staff Byron Brown and Deputy Associate Administrator for Policy Brittany Bolen. Indeed, the slow pace of the confirmation process sets the stage for Schedule C employees and/or the transition and beachhead teams at each of these agencies to play a significant role in drafting the reports, which will shape agency policy for the duration of the Administration.
(a) This section revokes the following executive actions:
Also of note, not included in this section is EO 13693, which had been listed in an early embargoed summary of the order. EO 13693, "Planning for Federal Sustainability in the Next Decade," issued March 19, 2015, directed agencies to establish agency-wide energy efficiency and renewable energy targets. As with the Paris Agreement, parts of the business community have encouraged the U.S. to maintain its commitments to energy efficiency and renewable energy. If EO 13693 is rescinded at a later date, agencies would be permitted to withdraw their sustainability plans – save for the Department of Defense, whose 25 percent renewables by 2025 target was codified in the National Defense Authorization Act of 2007.3
(b) This section also rescinds the following reports issued by President Obama pertaining to emissions reductions:
(c) This section rescinds the final guidance issued on Aug. 5, 2016, by the Council on Environmental Quality (CEQ) that requires federal agencies to consider GHG emissions and the effects of climate change in NEPA reviews. As with the rescission of the Presidential Memorandum on "Mitigating Impacts on Natural Resources from Development and Encouraging Related Private Investment," this action is primarily meant to ease permitting for fossil fuel energy projects by reducing the time and costs associated with project reviews.
Beyond permitting for fossil projects, however, the guidance applies government-wide and will also have significant impacts on the transportation sector and implementation of the Fixing America's Surface Transportation (FAST) Act of 2015. The permitting process for transit and infrastructure projects may become easier and less time-consuming, as NEPA reviews for these projects will no longer be required to take GHG emissions into consideration.
This section directs the Administrator of the EPA to review three regulations published on Oct. 23, 2015:
The Clean Power Plan (CPP) is currently on hold as the result of a stay enacted by the U.S. Supreme Court on Feb. 9, 2016, so states' compliance with the plan is currently voluntary. The EO directs the EPA to "suspend, revise, or rescind the guidance," with or without publishing the rules accomplishing this end for notice and comment. EPA announced on April 5 its formal review of the CPP, which will also review the compliance dates established in the order to ensure they are "reasonable and appropriate" given the Supreme Court's stay. In the announcement, EPA stated its intent to review and possibly rewrite a new rule governing GHG emissions limits for power plants; a process which, if the timeframe for the writing and publication of the CPP is to be a guide, could require more than a year of notice and comment even after a draft rule is published.
On April 4, 2017, EPA also announced it is withdrawing the two proposed rules governing the CPP's implementation: the Clean Energy Incentive Program (CEIP) and Federal Implementation Plan and Model Training Rules.4 The Federal Register notice justifies the withdrawal of both rules on the grounds that neither is required under the Clean Air Act (CAA) and focusing on the Acts principles of cooperative federalism aspires to prevent federal plans to implement emissions guidelines under the law. Given the Supreme Court's stay of the CPP, the EPA asserts that the compliance dates "must be reviewed" and that states should not be required to "work towards meeting the compliance dates" at this time. under the
This section also directs the EPA to review and possibly rescind the accompanying legal memorandum for the CPP, as well as enabling the Attorney General to request that courts stay the litigation pertaining to the CPP as the EPA addresses the CPP administratively.
Again citing the requirement that agencies use the "best available science," this section directs the withdrawal of documents issued between 2010 and 2016 establishing the "social cost of carbon" for regulatory impact analysis. As of 2015, the EPA had set this value at $36 per metric ton and $42 per metric ton for 2020. President Trump's EO directs agencies to return to the guidance in OMB Circular A-4 of September 2003, under which analysis from the international perspective is optional.5
This section also immediately disbands the Interagency Working Group on the Social Cost of Greenhouse Gases (IWG), which provided regular advisement on updates to the data point's calculation. The group consisted of presidentially appointed technical experts from a number of agencies.
This section directs the Secretary of the Interior to "take all steps necessary and appropriate to amend or withdraw" the federal government's moratorium on federal coal leasing enacted by Secretary of the Interior Sally Jewell's Order 3338 on Jan. 15, 2016, and to "commence Federal coal leasing activities." Secretary of the Interior Ryan Zinke signed Secretarial Order 3348 on March 29, revoking Order 3338.6
The moratorium was enacted amidst concerns that the government was not receiving fair market value for the leases. A 2013 Interior Department Inspector General Report found lost bonus revenues of $2 million in recent lease sales and $60 million in potentially undervalued lease modifications.7 In response to these concerns, Zinke has chartered a Royalty Policy Committee to advise on the fair market value for mineral and energy leases to ensure the public "continues to receive the full value of the natural resources produced on federal lands."8 Opponents have expressed concern that this fair market value will no longer take into effect the social cost of carbon, noting that approximately 40 percent of the U.S. coal production comes from publically owned lands.
(a) This section directs EPA Administrator Scott Pruitt to review and potentially rewrite the "Oil and Natural Gas Sector: Emission Standards for New, Reconstructed, and Modified Sources" rule, more commonly referred to as the "New Sources" or NSPS rule, made final on June 3, 2016. The industry-opposed NSPS rule would require new and modified fossil-fuel fired power plants to limit their carbon dioxide pollution. This regulation fell outside of the window for Congressional Review Act (CRA) action but has been the subject of fierce opposition from Congressional Republicans and the oil and gas industry alike. Accordingly, there have been efforts to block the rule through litigation. The Independent Petroleum Association of America (IPAA) and Western Energy Alliance, with the support of a broad coalition, filed suit against the rule in August 2016. The legal challenges have taken issue with the rule as excessive, uneconomical and unjustifiable given the decrease in methane emissions from the sector over a time period in which production has spiked. Oral arguments are scheduled for April 17, 2017.
(b) This section directs the Secretary of the Interior to review and potentially rewrite the following regulations intended to curb methane emissions from oil and gas operations. Of note, three out of four of these regulations were finalized in the final two months of the Obama Administration. Each of these four regulations were also subsequently identified for review in Zinke's Secretarial Order 3349 signed March 29, 2017.9
Section 7 also enables the Attorney General to request the delay of further litigation against rules identified in this section. This could have particularly challenging implications for the Methane Rule, for opponents may have difficulty bringing suit should the Senate pass the resolution of disapproval while the DOI is also administratively reviewing the rule.
3U.S. Army Energy and Water Management Program: Renewable Energy
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