Coal, Gas, Renewables

Power to the People: How Cutting the EPA Will Delay Utility Projects

Issue 5 and Volume 121.

by Robynn Andracsek, P.E., Burns & McDonnell and contributing editor

Environmental interest groups celebrate with each utility project’s cancellation; every project delay is also a success. President Trump’s proposed “America First” budget cuts $2.6 billion, or 31 percent, from 2017 funding and discontinues funding for the Clean Power Plan, international climate change programs, and climate change research and partnership programs. This budget, if enacted, will have an opposite effect from that intended. Power plant projects which benefit on paper from the cuts to EPA will in fact be delayed by citizen suits attempting to restore EPA’s power.

The Clean Air Act (CAA), which cannot be changed without an act of Congress, explicitly authorizes citizen suits to enforce CAA provisions. Section 304, aptly titled “Citizen Suits,” states “any person may commence a civil action” against the United States to enforce “an emission standard or limitation,” “against the Administrator where there is alleged a failure of the Administrator to perform any act or duty,” or “against any person who proposes to construct or constructs any new or modified major emitting facility.”

Intervener groups are intimately familiar with this power granted to them under the CAA, most recently in regards to EPA’s delay in promulgating air toxics standards. On March 22, 2017, a federal judge in the District Court for the District of Columbia ordered EPA to promulgate emission standards for 13 sources of hazardous air pollutants by June 30, 2020. EPA admitted that they had missed the regulatory deadline and four intervener groups sued to force EPA to act. Seth Jaffe, of the blog, says “if Congress enacts even a significant portion of the budget cuts requested by President Trump, we’re going to see a lot more such cases.”

The court order includes several key statements:

  • The Clean Air Act provides that the district courts of the United States shall have jurisdiction to compel nondiscretionary agency action that is unreasonably delayed.
  • Courts should be wary of agency arguments that more time is needed to improve the quality or soundness of the regulations.
  • If the EPA finds the schedule set by the Clean Air Act to be unreasonable, the agency’s remedy lies with Congress, not with the Courts.

In response to the proposed presidential budget, the EPA estimates 25% of its staff will be laid off. This budget blueprint serves merely as a guideline for any final enacted congressional budget. However, with a Republican majority in both houses of Congress, massive cuts to EPA will no doubt occur.

Following quickly after the presidential budget blueprint, two additional actions occurred that on the surface seem to favor utility companies. First President Trump’s executive order on “Promoting Energy Independence and Economic Growth” declared: “It is in the national interest to promote clean and safe development of our Nation’s vast energy resources, while at the same time avoiding regulatory burdens that unnecessarily encumber energy production, constrain economic growth, and prevent job creation.” Then EPA administrator Pruitt wrote to the governors of each state that they are neither “required nor expected to work towards meeting the compliance date set in the” Clean Power Plan.

The rally cry for intervener groups is now prewritten. They will surely focus their efforts on climate change regulations. Acknowledging both that utilities emit a large portion of U.S. greenhouse gases and that public passion centers on climate change, public uproar and lawsuits will center on utilities.

Utility companies learned from the lessons of the Clean Air Mercury Rule, the Clean Air Interstate Rule, and the Cross-State Air Pollution Rule that legal challenges to environmental rules create economic uncertainty when funding power plant maintenance or expansion projects. Nothing in the executive order nor the new EPA policy negates the fact that the Supreme Court ruled that greenhouse gases are a pollutant under the Clean Air Act. Although not perfect, the Clean Air Act at least had become well understood by utilities over the last 45 years of its implementation. Utilities, through their interest groups, had input into the pending regulations. Now, certainty has been thrown out the window.

Therefore, the utility which argues against EPA cuts would both curry favor with the public while advocating for EPA policies which reduce economic and regulatory uncertainty for their power plant projects.