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When the Obama administration was unsuccessfully trying to push the “cap and trade” bill through Congress, the president and his Environmental Protection Agency (EPA) administrator Lisa Jackson repeatedly warned policymakers that if the bill didn’t pass, they would regulate greenhouse gases through the Clean Air Act anyway. Given the tedious complexity of the Clean Air Act process, many (including this writer) believed this was a hollow threat. We were wrong. On Wednesday, Jackson released a document that will serve as the blueprint for a sweeping new power grab by her agency, one that neatly avoids the tiresome and time-consuming requirements that a piece of legislation duly passed by Congress would impose on the EPA. Under this new set of policy guidelines, bureaucrats charged with regulating the amount of air pollutants released into the atmosphere will be empowered to step away from the smokestack and step into the boiler houses and board rooms of industries across the country.
Up until now, the authority of the EPA and the state and local agencies that do the bulk of environmental work in the field has been limited to “what comes out of the stack.” The EPA could limit emissions, in order to meet applicable standards, but it couldn’t get involved in economic decisions or process details. Those days are over. In the name of reducing greenhouse gas emissions, the EPA will be directing the state and local agencies that report to the feds to use “energy efficiency” as a permitting guideline. Jackson’s agency wants bureaucrats across the nation to begin dictating choices in equipment and the way that equipment is operated and maintained, and to turn the EPA’s judgment on the best way to operate a facility into permit conditions.
The document in question is entitled “PSD and Title V Permitting Guidance for Greenhouse Gases.” It was released to the public on Wednesday. The fact that it is a guidance document, as opposed to a formal regulatory proposal, is very significant. Regulations have to be proposed in certain forms, economic costs have to be considered, and there is a long, detailed public process involved. Guidance, on the other hand, isn’t subject to any of these sorts of annoying requirements. Guidance is the EPA offering its “opinion” on a subject and, when the criticism begins, Jackson will surely hide behind this accurate, but ultimately deceptive, detail. Few states outside of Texas will ignore EPA guidance, for such a document is traditionally treated as Holy Writ by state and local agencies. After all, their permitting decisions are ultimately subject to the EPA’s approval. How can a state regulator expect to have a decision approved by the overseeing federal authority if he or she ignores federal guidance?
It’s a subtle, yet devilishly brilliant policy. Few people understand the legal distinctions that come into play and Jackson will be able to con much of the mainstream media into believing that industrial advocates like me are making a mountain out of a molehill. We’re not. For those readers not aware of it, I am an expert on environmental regulation in general and the Clean Air Act in particular. Helping industry deal with both has been my primary career for over twenty-five years. Believe me: the implications of what Jackson is trying to do will have severe repercussions on our beleaguered industrial sector.
In this particular guidance document, the EPA acknowledges that the Holy Grail of greenhouse gas control, carbon capture and sequestration (i.e. injecting carbon dioxide deep underground) is a long way away from being a cost-effective, reliable technology – if it ever will be. That’s a reasonable start, but it’s all downhill from there. When permitting large new industrial projects, or major modifications to existing plants, the agency is directing permitting authorities to require energy efficiency improvements in order to reduce greenhouse gas emissions. Now, nobody is against energy efficiency and most everyone in the private sector is amenable to anything that reduces energy costs. However, when the EPA decides that it should dictate energy efficiency measures by choosing equipment, influencing process design, and turning what should be operational decisions into permit conditions, we’ve crossed a line.
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