Today, the Environmental Protection Agency (EPA) released a much anticipated study looking at the impacts of hydraulic fracturing. As concluded by the EPA, hydraulic fracturing, or the innovative, high-tech process used to access our vast American natural gas resources, has “not led to widespread, systemic impacts on drinking water resources.” Read More
Today, the National Association of Manufacturers sent a letter to the House of Representatives and Senate expresses support for H.R. 83, the Consolidated and Further Continuing Appropriations Act. The letter, from NAM Senior Vice President, Policy and Government Relations Aric Newhouse, outlines a number of measures in the legislation that are priorities for the manufacturing sector and will help the economy continue to rebound. Read More
The Environmental Protection Agency (EPA) can’t keep up with the pace of its own regulatory schedule. That is not intended to be a slight on the agency or its staff, it’s a fact stemming from a combination of factors – NGO lawsuits, a President with an overly aggressive regulatory agenda and an out-of-date environmental statute that requires review of air quality standards before they are even implemented. If the regulators can’t keep pace with their own regulations, I assure you manufacturers – who need to make investment decisions looking years into the future – can’t either.
While the rate at which air regulations are issued and then revised and then issued again has been a problem for several years, the issue is being amplified as the Administration considers new ozone regulations that could be the most expensive environmental regulation issued in this era of the Clean Air Act. The EPA last issued new ozone standards in 2008 and still has yet to issue its final implementing regulations for the 2008 standard. Meanwhile, the agency is under court order to consider revising that still-unimplemented standard by December of this year. And because of the five-year review requirement for all National Ambient Air Quality Standards (NAAQS), after the agency issues this round of new ozone standards, it will almost immediately have to begin work considering still newer (and likely stricter) ozone standards. This never ending cycle of regulations, reviews and new regulations adds to a regulatory environment where the uncertainty of what the new requirements will be is becoming almost as burdensome as the actual regulations. This isn’t working. Something needs to change.
Senator Flake’s (R-AZ) Ozone Regulatory Delay and Extension of Assessment Length Act of 2014 would provide some necessary relief to manufacturers by setting NAAQS reviews on a ten-year cycle. This makes sense. From 1980 to 2012, emissions of the six principal air pollutants the EPA regulates has dropped by 67%. By EPA’s own estimates, ozone precursor emissions are expected to drop another 25% from current levels – in part because of a slew of other regulations that still have not been fully implemented. Adding another layer of new regulations now will only add costs and uncertainty to a manufacturing sector that, if permitted to, will continue its renaissance driving economic growth and jobs in the process.
Manufacturers need our elected officials to provide some relief to a regulatory system that has truly become an ORDEAL to keep up with. For that reason, the National Association of Manufacturers commends Senator Flake for his leadership in proposing this commonsense bill and encourages all U.S. Senators to follow suit and support this effort.
Today the Senate Committee on Environment and Public Works held a confirmation hearing for the EPA’s Assistant Administrator for the Office of Air and Radiation Gina McCarthy, President Obama’s nominee for EPA administrator.
Several senators had questions about the EPA’s proposed regulations and their impact on the economy as well as the continued act of what is known as “sue and settle” by the agency. Senator Vitter (R-LA) asked McCarthy if the EPA would change its process regarding “sue and settle” and alert other stakeholders when legal action is taken.
The NAM sent a letter yesterday to Acting EPA Administrator Bob Perciasepe asking the agency to please provide some sort of alert system for each time a lawsuit is filed against the agency or if they receive a notice of legal action.
Senator Inhofe (R-OK) asked McCarthy if the EPA planned to make any changes to the proposed greenhouse gas rule on for new power plants and she did not provide any information on the agency’s plan for the rule. This rule would essentially prevent the construction of any new coal burning power plants and several types of new gas-fired power plants. Manufacturers believe we should continue to take advantage of all sources of energy, including but not limited to coal, natural gas, oil, nuclear, renewables, and energy efficiency. Lower energy prices help manufacturers better compete and taking some sources off the table will only hurt our long term competitiveness.
Moving forward we would like the EPA to take into careful consideration the cost and economic impact of all regulations proposed by the agency.
This afternoon the National Association of Manufacturers joined a large business coalition in filing petitions with the U.S. Court of Appeals for the D.C. Circuit for an “en banc” rehearing of the cases against the Environmental Protection Agency (American Chemistry Council v. EPA and Coalition for Responsible Regulation, Inc. v. EPA) over the costly greenhouse gas regulations. Essentially the petitions ask the court for a new hearing before the entire court, not just the three judge panel.
The EPA’s greenhouse gas regulations are one of the most costly and burdensome regulations facing manufacturers. The regulations will allow the EPA the authority to go into businesses and dictate how they conduct their business and run their operations.
Under these regulations the EPA will eventually require new burdensome permitting requirements for more than 6 million stationary sources, including 200,000 manufacturing facilities, 37,000 farms and millions of other sources such as schools, universities, hospitals and even homes. Essentially these regulations will impact every aspect of our economy.
According to the latest NAM/IndustryWeek Survey of Manufacturers the unfavorable business climate due to regulations and taxes is the top concern of manufacturers. The EPA’s greenhouse gas regulations directly contribute to this uncertainty.
Ross Eisenberg is vice president of energy and resources policy, National Association of Manufacturers.
Manufacturers continue to set ambitious goals for their sustainability programs. Last month, International Paper, announced 12 voluntary sustainability goals which included:
- 15% improvement in energy efficiency in purchased energy use;
- 20% absolute reduction in global GHG emissions associated with production; and,
- 15% global increase in third-party certified fiber volume.
Other goals focused on philanthropy, safety and water use. These benchmarks were part of International Paper’s 2011 Sustainability Report which also highlighted achievements such as an Environmental Protection Agency (EPA) Climate Leadership Award, improvements in worker safety and sustainability accolades from Fortune Magazine and the Ethisphere Institute.
In a press release, Chairman and CEO John Faraci stated, “At International Paper, sustainability is more than a business practice. Environmental, social and economic performance has been at the core of our company for more than 110 years. Stewardship of the forestland and surrounding habitat is ingrained in our company’s DNA.”
We applaud International Paper’s efforts and look forward to tracking the company’s progress as it works to achieve these sustainability goals.
If two environmental groups had their way, greenhouse gas emissions would be regulated by every state in the country, as well as by the Environmental Protection Agency (EPA) and the Departments of the Interior, Agriculture, Commerce, Energy and Defense. The groups have brought legal actions in virtually every state and against the federal government to compel government officials to impose 6 percent annual reductions in greenhouse gas emissions under a theory that each government has a duty to protect the air as a commonly shared public trust resource.
This would be a disaster for manufacturers, who would have to understand and comply with conflicting air emission requirements throughout the country.
Fortunately, a federal judge yesterday threw out their complaint against the federal agencies. In a straightforward opinion, Judge Robert L. Wilkins of the federal district court in the District of Columbia ruled that federal courts have limited jurisdiction, and can’t hear a claim that is fundamentally a state law claim.
He also said that, even if there were a valid claim to regulate air emissions under federal common law, that claim has been displaced by the Clean Air Act. Only the EPA has the power to set those limits, subject to judicial review.
The NAM has taken the lead in fighting a barrage of lawsuits that attempt to regulate by litigation. We intervened in this case last year, and filed and argued the motion to dismiss that has now won the judge’s approval. We also filed opposition briefs in the 2007 Massachusetts v. EPA case, in which the Supreme Court first recognized EPA authority over greenhouse gases.
Last year, we also filed in the American Electric Power case, in which the Court rejected claims to abate carbon-dioxide emissions under federal common law. Cases raising state common law claims are still pending, and we will continue to fight these battles.
This latest decision offers some optimism that private lawsuits to force changes in public policy are not gaining favor in the courts.
A summary of the case, Alec L. v. Jackson (D.D.C.), and our briefs, can be found here.
Quentin Riegel is vice president of litigation and deputy general counsel, National Association of Manufacturers.
Late Friday afternoon the U.S. District Court for the District of Columbia issued a ruling on the Mingo Logan Coal Company case. This case was important because the question at hand was could the Environmental Protection Agency (EPA) withdraw a permit issued by the Army Corps of Engineers (Corps).
The EPA withdrew its approval of certain creeks as disposal sites for a mine four years after it had given its assent to a permit issued by the Corps. The Mingo permit had always been in compliance and there was no question in that regards. EPA had simply changed their mind and revoked the approval of the disposal sites.
Arch Coal, owner of the Mingo Logan Coal Company, sued EPA and challenged their authority to veto the permit after the fact. The District Court agreed with Arch Coal that EPA exceeded their authority under the Clean Water Act when they attempted to invalidate an existing permit. The court concluded that Clean Water Act does not give EPA the power to render a permit invalid once it is issued by the Corps.
What does this all mean? First, that the EPA has finally reached a point where even the U.S. District Court for the District of Columbia had to say no and slap their hands. Second, it means that EPA actually has to follow the law and can’t do whatever they darn please. Third, it means that businesses can rely on federal permits. Although it may cost them hundreds of thousands of dollars and years of effort to obtain a permit, once they make the investment and get the permit, the EPA can’t simply change their mind and veto it.
The court described the EPA’s actions, “It posit[ed] a scenario involving the automatic self-destruction of a written permit issued by an entirely separate federal agency after years of study and consideration. Poof!” Judge Amy Berman Jackson went on to say that “EPA resorts to magical thinking” when coming up with a reason to try to nullify the permit.
Even if the agency were accorded some deference under administrative law procedures, the agency’s interpretation was unreasonable and could not stand. The judge also cited the NAM’s amicus brief to show that eliminating finality from the permitting process would have a significant economic impact on industry, in turn making EPA’s assertion of power less reasonable. This was a significant victory for manufacturers and the rule of law.
If this were not enough, the Supreme Court ruled 9-0 against the EPA in the Sackett case, which involved two landowners in Idaho who attempted to build a home on their property. After they got local building permits and started work, the EPA ordered them to stop and turn the land to its previous condition, or face huge daily fines. They sued to challenge the EPA’s order.
The EPA maintained that the owners had no right to take them to court to contest whether or not there had been a violation of the law. The Supreme Court ruled that the EPA can’t deny landowners their day in court.
These are rulings that send a clear message to the EPA that it is no longer business as usual. It’s important for the EPA to work with land owners and businesses, instead of trying to veto existing permits or imposing fines and other penalties that will cost jobs and harm the economy.
Chip Yost is vice president of energy and resources policy, National Association of Manufacturers.
In a victory in the battle against the EPA’s overreach this morning the United States Supreme Court ruled on the Sackett v. EPA case in favor of the plaintiffs. The case was originally brought by an Idaho couple over the right to go to court to challenge an EPA order that blocked construction of their new home.
The couple had graded a small lot for the new house and was ordered by the EPA under the Clean Water Act to fill in the lot, replace vegetation and monitor the land for three years or face a $37,500 penalty for each day of violation. The couple then sought court review of the order but they were denied.
Today the Supreme Court ruled that the couple does have a right to go to court to get a pre-enforcement review of the order and they do not have to wait for the EPA to sue them for violating the order in order to raise their claims. While EPA still has the power to issue these kinds of orders, and most of them will never be challenged, the ruling makes judicial review possible and will help restrain the abuse of EPA’s power. The decision could restrain EPA overreach under other environmental statutes as well.
Of note was Justic Alito’s concurring opinion on the case which agreed completely with the decision but also noted that the reach of the Clean Water Act is unclear. He states that any piece of land that is wet at least part of the year is in danger of being classified by the EPA as wetlands and he says that real relief requires Congress to clarify the rule.
Real relief requires Congress to do what it should have done in the first place: provide a reasonably clear rule re-garding the reach of the Clean Water Act. When Congress passed the Clean Water Act in 1972, it provided that the Act covers “the waters of the United States.” 33 U. S. C. §1362(7). But Congress did not define what it meant by “the waters of the United States”; the phrase was not a term of art with a known meaning; and the words themselves are hopelessly in determinate. Unsurprisingly, the EPA and the Army Corps of Engineers interpreted the phrase as an essentially limitless grant of authority.
After spending billions over the last six years, Shell Oil moved one step closer to exploring for oil and gas off the coast of Alaska when the EPA finally issued an air permit for operations in the Chukchi Sea. Shell is hopeful that other needed approvals and permits from federal agencies will be issued, so that exploration in the 2012 can go forward.
Alaska’s offshore likely holds world-class volumes of oil and gas. Development of these resources will make a significant contribution to the nation’s energy security. Jobs and government revenue will be generated not only in Alaska, but also in the Lower 48. The University of Alaska estimates that development will create an average of nearly 55,000 jobs per year for decades and through 2057 and will generate a total of $145 billion in payroll. Federal, state and local government revenues will increase by almost $200 billion.
While regulations that ensure offshore development is done safely and responsibly are important, the US government must also have a regulatory system that works fairly and efficiently. In Alaska, the government did years of environmental analysis before inviting companies to bid on offshore leases.
Since 2005, Shell Oil has paid the government over $2.2 billion for ten-year leases that in some cases are now six years old. Despite spending an additional $1.5 billion to prepare for exploring these leases, Shell has not drilled even one well, largely due to the government’s inability to deliver useable permits in a timely way.
At a time when the nation’s needs the energy, the jobs and the economic impact, developing Alaska’s resources should be a priority. Manufacturers are cautiously optimistic that the regulatory barriers will continue to be removed.
Mahta Mahdavi is director of energy and resources policy, National Association of Manufacturers.