While President Trump has taken steps to lighten the regulations on the energy industry, companies may not feel the changes for a while.
While President Donald Trump’s recent executive order may have signaled an end to the aggressive environmental regulations pursued by the Obama Administration, those who hope that the President has rewritten Obama’s environmental legacy with the stroke of a pen ought to consider the legal and administrative hurdles ahead.
President Trump’s order, signed on March 28, seeks to roll back the Clean Power Plan and rewrite the New Source Performance Standards rules enacted by Obama’s EPA in 2015, both of which attempted to reduce carbon emissions and specifically targeted coal-fired power plants.
To many, it would seem that since former President Obama unilaterally mandated his aggressive climate agenda through executive orders—and without support from Congress or presumed authority under the Clean Air Act—President Trump could undo them just as easily. But that’s where legal and administrative obstacles arise.
First, both the Clean Power Plan and New Source Performance Standards rules remain in flux due to legal challenges. While the litigation can be held in abeyance by the court pending EPA’s reconsideration of the rules or the rules withdrawn by EPA, intervenors (third parties who have an interest in the litigation) involved in the litigation can oppose those actions, possibly tying EPA’s hands and further delaying rescission of the rules. Therefore, even if Administrator Pruitt withdraws the federal government’s legal support for the rules, it does not necessarily mean the court will stop the ongoing litigation over the rules.
Second, significant administrative hurdles stand in the way of completely unwinding these rules. Even if EPA does withdraw the rules in order to either reconsider or rescind them, both of those actions will be subject to the public notice and comment process. This process takes significant time and will likely prompt additional legal challenges. For context, the public comment period for the final Clean Power Plan rulemaking was open for six months and received more than 4 million comments. If Administrator Pruitt’s EPA withdraws the rule, environmental groups and states will likely be the ones taking swift legal action.
Third, it also is worth considering that the most deeply rooted EPA directive is the regulation of greenhouse gases and carbon emissions as a pollutant. While other parts of Obama’s rules are being challenged and pending a decision in court, EPA’s authority to regulate greenhouse gas emissions under the Clean Air Act is very much still in effect – and will be difficult to undo.
In a 2007 case called Massachusetts v. EPA, the U.S. Supreme Court held that the Clean Air Act gives the EPA authority to regulate greenhouse gases and carbon emissions as pollutants, creating a legal precedent for many of Obama’s EPA rules during his terms.
Thus, even if the Clean Power Plan and New Source Performance Standards are rescinded, Trump’s EPA still would have to regulate greenhouse gases in some way or face citizen suits from environmental groups that could end up forcing EPA to promulgate a rule regulating those “pollutants.”
Overall, regulation-weary businesses should take some solace in the new course Trump has set for his EPA and in keeping his campaign promise. In addition, the energy industry should be particularly pleased to hear of President Trump’s direction to the EPA to review how environmental rules have impacted energy production. It is also important, however, to recognize that the road to unwinding the Obama environmental initiatives will take time, effort, and probably a lot more legal action.
Danelle M. Gagliardi is an associate at Squire Patton Boggs in Columbus.