Authors: Jamie Auslander, Peter Schaumberg, David Friedland, Brook Detterman
Beveridge & Diamond, P.C. , March 28, 2017
On March 28, 2017, President Trump signed an Executive Order entitled “Promoting Energy Independence and Economic Growth” (EO). This latest EO aims to further incentivize domestic energy production, particularly coal, oil and gas, by rolling back regulations and guidance premised on climate change considerations. If fully implemented, it would have noticeable and substantive impacts on EPA, Interior, and other agency programs. Yet it remains to be seen how quickly or effectively the stroke of the President’s pen will translate into on-the-ground actions, and to what extent it may yield opportunities or challenges for energy and natural resources project development. In the interim, the EO sets in motion several energy-based initiatives across multiple agencies warranting close monitoring and active participation.
The EO means almost instant change for some programs:
In other instances, any impacts of the EO will be more delayed:
While this agenda is sweeping and a sharp departure from the past few years under President Obama, its ultimate impact is uncertain. For example, the EO does not necessarily obviate consideration of climate change in NEPA reviews – courts remain the driver here, and thinner administrative records could be more vulnerable to NEPA-based challenges by project opponents. Likewise, elimination of mitigation guidance does not eliminate mitigation where required, a frequent ground for legal challenges to agency permitting decisions. Rescission or amendment of current, legally binding climate-related regulations will require likely years of additional rulemaking under the Administrative Procedure Act, with uncertain outcomes. Utilities will still face economic and other factors in determining their optimal energy mix.
Litigation also stands in the way of its near-term implementation, as the EO recognizes. Some rules, including the Clean Power Plan and the fracking rule, are actively being litigated, and it is unclear to what degree the courts will be sympathetic to suspending the litigation to facilitate rescission or rewriting of those rules. In particular, all briefing and oral argument have been completed in the Clean Power Plan case, and the D.C. Circuit may want to issue a merits ruling that could limit the government’s options going forward. As another example, it is unclear whether the EO and related actions to pare back regulation of greenhouse gases under the Clean Air Act will affect the viability or preemption of tort claims based on alleged climate change-related impacts. At the same time, the change in course under the EO creates opportunities for energy project proponents to proactively seek more streamlined environmental reviews or permit approvals, participate in the refashioning of climate policy, and identify further regulatory targets for reform.
Beveridge & Diamond’s Natural Resources & Project Development practice and Air and Climate Change practice counsel clients on the issues addressed in the March 28 Executive Order, including representing clients in litigation. For more information on how the Executive Order may impact your business, please contact the authors or your usual Beveridge & Diamond contact.