Inside the Beltway

by Myron Ebell on January 18, 2011

in Blog

Three events last week demonstrated that the EPA’s new regulation to reduce greenhouse gas emissions from large stationary emitters such as power plants is not the only tool being employed to strangle the economy.  There’s also the Clean Water Act, the Endangered Species Act, and Corporate Average Fuel Economy or CAFÉ standards.

First, the Clean Water Act

The EPA last Thursday announced that they were going to force the Corps of Engineers to revoke an already granted Section 404 permit to Arch Coal’s Spruce Fork Mine, which is an operating surface coal mine in West Virginia.  The New York Times and the Wall Street Journal articles repeated the EPA’s ludicrous claim that new scientific research since the permit was granted in 2007 shows that surface mining will have much more detrimental environmental and health effects than previously thought.  My CEI colleague William Yeatman has written about this issue here, and CEI sent out a press release criticizing the decision.  EPA’s revocation of a permit that has already been granted for a mine that is already in operation is outrageous.  The consequences could be catastrophic if this precedent scares away investors in future energy projects because of the risk that their investment could be lost by the retroactive revocation of an operating permit.

Second, the Endangered Species Act

The polar bear was listed as a threatened species by President George W. Bush’s Secretary of the Interior Dirk Kempthorne in 2008.  Last month, President Obama’s Interior Department designated 187,000 square miles in the Chukchi and Beaufort Seas off Alaska’s north coast as critical habitat. Interior also explained that the designation of critical habitat would require more environmental scrutiny of offshore oil and gas exploration and production, but that it would not be used to ban drilling.  The Center for Biological Diversity last Thursday announced that they would file suit in federal court to force Interior to ban all oil and gas drilling within the critical habitat designation.  This is a game that has often been played by environmental pressure groups working with their allies in the executive branch (and often those allies were formerly employed by environmental pressure groups).  Interior Secretary Ken Salazar can claim that he is trying to be reasonable and to balance environmental and economic interests, but will then probably reach a settlement with the Center for Biological Diversity to ban some or all drilling in the designated critical habitat.  Once the court approves, the settlement will have the force of law and will be nearly impossible to overturn.

Third, CAFÉ standards

In 2009, the Obama Administration did a deal with the State of California and the auto industry.  The auto industry thought they were getting some mythical beast called “regulatory certainty” in return for agreeing to a CAFÉ standard of 35.5 miles per gallon for cars and light trucks by 2016.  First, EPA said last fall that they were considering raising that to up to 62 miles per gallon by 2025.  Now, the California Air Resources Board is making sounds that it wants to control the process by setting its own higher standards beginning in 2017, which would precipitate the same mess that the auto industry assumed they had alleviated with their 2009 deal over the California Waiver.  So this week the Alliance of Automobile Manufacturers sent a letter to Rep. Darrell Issa (R-Calif.), the new Chairman of the House Oversight and Government Reform Committee, and Rep. Fred Upton (R-Mich.), the new Chairman of the House Energy and Commerce Committee, asking for help.

I don’t have much sympathy for the automakers because they were warned that this is what would happen (I know because I and my colleagues at CEI were among those warning them publicly), but it needs to be kept in mind that the ultimate victims will be consumers who want to buy cars.

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