In a recent post, I explained how President Obama’s Interior Department has undertaken a radical reinterpretation of the 1977 Surface Mining Control and Reclamation Act (SMCRA) that threatens to shut down coal production in Appalachia. In a nutshell, SMCRA authorizes coal surface mining, but now the Obama administration is poised to reinterpret the law such that it bans surface coal mining. (Read all about it, here). This is the latest salvo in the President’s war on coal; if implemented, it would effectively destroy the Appalachian coal industry.
Despite the enormous consequences at stake—an industry hangs in the balance—the Department of the Interior has deliberated largely in secret. Besides an Associated Press report on a leaked draft impact analysis, which suggested that the reinterpreted law would eliminate 7,000 jobs in Appalachia, information about the proposed rewrite has been scant.
For more than a year, House Natural Resources Committee Chairman Doc Hastings (R-Washington) has been asking the Obama administration for information about the pending SMCRA rulemaking. And for more than a year, the Interior Department has refused to comply with Chairman Hasting’s requests. This is particularly galling given that the information sought by Hastings can hardly be deemed as controversial. Basically, he wants the Interior Department to produce the draft Environmental Impact Statement and Regulatory Impact Analysis. These are standard procedural documents common to almost all major regulations. More importantly, these analyses were financed by taxpayers. Why wouldn’t a Member of Congress have a right to see documents that were created with taxpayer money, and which pertain to a reinterpretation of a law passed by the Congress? Simply put, there is no legitimate reason for the Obama administration to resist, especially in light of its boasts of being the most open and transparent administration, ever.
Last week marked the end of Chairman Hasting’s patience with the administration’s stonewalling. On Thursday, he subpoenaed the Interior Department, seeking:
- All recordings, and complete and unredacted transcripts of recordings, of meetings between the Department and contractors regarding the rewrite of the rule. This includes, but is not limited to, the known 43 digital audio recordings totaling approximately 30 hours.
- Complete and unredacted versions of email communications previously provided to the Committee and documents reviewed by Committee staff in camera.
- All documents related to the development of the Advanced Notice of Proposed Rulemaking and Notice of Intent to prepare a Supplemental Environmental Impact Statement for the coal production regulation.
- Complete drafts of the Environmental Impact Statement and the Regulatory Impact Analysis as of January 31, 2011 for the Administration’s rewrite of the coal production regulation.
- Complete current drafts of the Environmental Impact Statement and the Regulatory Impact Analysis for the Administration’s rewrite of the coal production rule, as well as versions created since January 31, 2011.
Chairman Hastings gave the Interior Department until April 12, 2012 to comply. In a press release, his office indicated that this action was only the first step, and that “Additional categories of documents, not included in this subpoena but previously requested as far back as February of 2011, that are broader in scope and will likely produce a greater volume of responsive material are anticipated to be sought in the near future.”
Earlier this week, the Treasury Department’s Office of Inspector General (OIG) released an audit report on Treasury’s role in reviewing, in March 2009, the Department of Energy’s (DOE’s) $535 million loan guarantee to Solyndra, the solar panel manufacturer that filed for bankruptcy in September 2011. Before going belly up, Solyndra burned through $528 million of the $535 million it received from Treasury’s Federal Financing Bank (FFB). Nearly all of the defaulted loan will be paid off by American taxpayers.
An agency’s OIG is supposed to be a watchdog guarding the public fisc from waste, fraud, and abuse. Watchdogs bark and even bite. This watchdog pussyfoots.
The title of the audit report is “Consultation on Solyndra Loan Guarantee Was Rushed.” Well, it was that. Treasury signed off on the Solyndra loan guarantee only two days after being asked on March 17, 2009 to vet it so that DOE could issue a press release touting the loan on the morning of March 20.
A more accurate title would be “Consultation on Solyndra Loan Guarantee Was Half-Assed.” Granted, government reports must eschew the use of idiomatic pejoratives. Nonetheless, the OIG did not have to make excuses for Treasury and DOE. The report ascribes to regulatory vagueness derelictions more reasonably attributed to negligence, incompetence, and pliancy in the face of political pressure. [click to continue…]
In December 2010, the Environmental Protection Agency ordered Fort Worth, Texas-based Range Resources Corporation, a natural gas company, to provide drinking water to residents in Parker County, because EPA tests had concluded that hydraulic fracturing (a.k.a. “fracking”) operations by the company “caused or contributed to the contamination of at least two residential drinking water wells.” EPA rendered this decision over the staunch objection of Texas officials, who argued that water in the Parker County wells had been contaminated by naturally occurring methane. Subsequent lab tests by the state Railroad Commission, which regulates oil and gas extraction in Texas, exonerated Range Resources.
Last Friday, EPA informed Range Resources that it was dropping its order. Although EPA’s letter to the company did not identify why the Agency was abandoning its case, it would appear that the move is a vindication of the conclusions drawn by the Railroad Commission.
This is the second time in three weeks that EPA has suffered egg on its face for an overreach on fracking regulation. In mid-March, EPA informed residents of Dimock, Pennsylvania that drinking water there has not been contaminating by hydraulic fracturing drilling. That revelation was uncomfortable for the Agency, because it had decided to test the Dimock water over objections from Pennsylvania officials.
In both instances, EPA took care to be discreet. In Dimock, the Agency hand delivered the negative lab results to residents; in Texas, EPA informed Range Resources general counsel with a brief letter. In neither case did EPA issue a press release.
EPA’s tight lipped approach to divulging information in these two cases stands in stark contrast to the Agency’s trumpeting of controversial, preliminary lab results suggesting that hydraulic fracturing “likely” contaminated water in Pavillion, Wyoming. Despite the severe public relations ramifications of the Pavillion press release (it was immediately seized upon by enviros as “evidence” that fracking threatens the nation’s water supplies), EPA issued it: (1) without having peer-reviewed the lab results and (2) in the face of substantial criticism about methodology leveled by Wyoming officials.
EPA thus demonstrates a striking public relations inconsistency regarding hydraulic fracturing. When lab results are good for the gas industry, they are announced to a handful of people. When lab results are bad for the industry, however, they become the subject of a press release that is rushed out the door before it is properly vetted.
A surprising development from a country not known for backing down from a fight:
In a sign that Paris has little stomach for a fight over global warming, Francois Fillon, the Prime Minister, urged the European Union to retreat over plans to tax airlines for emitting greenhouse gases.
His letter to Jose Manuel Barroso, the European Commission President, undermined the EU’s claims to be united in its drive to impose ecological virtue on the aviation industry. The plan to force airlines to buy pollution permits when flying in European airspace has been denounced as illegal by other capitals, notably Beijing, Delhi and Washington.
The so-called coalition of the unwilling is pledging to retaliate unless Europe backtracks. Chinese and Indian airlines have been told by their governments to boycott the scheme.
Their American counterparts filed a lawsuit before withdrawing it last month and calling on the Obama Administration to take the lead in pressuring Europe to drop its aviation pollution package.
In France, concern has been fuelled by Airbus, the European aircraft maker, which said that China had shelved orders worth $US14 billion ($13.5 billion) because of the dispute.
The company said that officials in China, which represents 20 per cent of Airbus sales, were withholding their signature on contracts for 35 long-haul A330s and 10 A380 superjumbo planes. [click to continue…]
According to a new Government Accountability Office audit, the military lacks proper safeguards to ensure that spending on politically fashionable green energy isn’t wasted. I am not shocked. After all, taxpayer investments in renewable energy are inherently wasteful, for reasons that I explain here and here. And military spending is mythically wasteful: It’s commonly held urban legend that Army screws cost $10 each. Together (investment in politically-favored energy sources + the military’s tendency to spend big), the only question is whether they engender a greater degree of waste than their mere sum would suggest. This GAO report indicates that such a synergy does indeed accelerate the flow of taxpayer money down the drain.
The Los Angeles Times takes a look at some infighting going on in the environmental movement, with local chapters of large environmental organizations feeling ignored by the large national groups pushing renewable energy projects. This specific controversy concerns a large solar panel project in the Mojave desert in southeastern California. Needless to say, I don’t think a vast array of solar panels should be built in the Mojave desert either, but likely for different reasons than the local environmental groups. Here’s the introduction:
AMARGOSA VALLEY, Calif. — April Sall gazed out at the Mojave Desert flashing past the car window and unreeled a story of frustration and backroom dealings.
Her small California group, the Wildlands Conservancy, wanted to preserve 600,000 acres of the Mojave. The group raised $45 million, bought the land and deeded it to the federal government.
The conservancy intended that the land be protected forever. Instead, 12 years after accepting the largest land gift in American history, the federal government is on the verge of opening 50,000 acres of that bequest to solar development.
Even worse, in Sall’s view, the nation’s largest environmental organizations are scarcely voicing opposition. Their silence leaves the conservancy and a smattering of other small environmental organizations nearly alone in opposing energy development across 33,000 square miles of desert land.
“We got dragged into this because the big groups were standing on the sidelines and we were watching this big conservation legacy practically go under a bulldozer,” said Sall, the organization’s conservation director. “We said, ‘We can’t be silent anymore.’ ” [click to continue…]
I didn’t think it was possible to loathe green cars any more so than I already did, but I was wrong.
For long I have hated electric vehicles because I, like all taxpayers, am forced to subsidize their purchase, to the tune of $7,500* per car (although some estimates of the taxpayers’ contribution are much, much higher). This galls me, because the only people who purchase electric cars are rich. For example, Brad Pitt bought a $100,000 luxury Tesla Roadster, and I had to help him. Of course, Mr. Pitt is super rich, so he didn’t need my help. Moreover, I’d prefer not to help him, as I have a trillion other priorities that take precedence over a movie star’s choice of car. I don’t think this arrangement is fair and, as a result, I disdain green cars. You could say that I hate the player, and I hate the game.
Now, in addition to taking my money, green cars are usurping Americans with disabilities. The photo above was sent to me on Wednesday by my colleague Christine Hall Reis. Look how close that spot is to the store! It must be a retrofitted handicap space.
*Since February, President Barack Obama has been pushing to increase the regressive taxpayer subsidy for electric vehicle purchases, from $7,500 to $10,000.
The most absurd aspect of the Environmental Protection Agency’s War on Coal is their repeated denials that it’s happening. No matter how many onerous rules they release, each time they claim that the regulation will not only save the environment, but also create jobs in the industry. For example, EPA’s Regulatory Impacts Assessment (RIA) for their mercury regulation known as the Utility MACT—which was (until possibly this week) the most draconian of the coal regulations—argues that the regulation will create almost 10,000 coal jobs.
Specifically, EPA’s Utility MACT regulation requires plants to install “maximum achievable control technology” (MACT)—otherwise known as scrubbers—to remove mercury and other toxins from exhaust. The rule is one of the most expensive in history: EPA estimates it will cost almost $11 billion annually to implement. Already, these compliance costs have led to the shutdown of dozens of coal-fired power plants. Yet, EPA supporters parrot EPA’s claim that this regulation will create thousands of jobs as if it had scientific authority.
EPA’s science is based on a Resources for the Future (RFF) study (Morgenstern, et al) of environmental expenditures in four industries in the 1980s—pulp and paper, plastics, petroleum, and steel—which found “a net gain of 1.55 jobs per $1 million in additional environmental spending” in those industries. EPA then took this formula and just multiplied times the estimated cost of the Utility MACT—$10.9 billion adjusted for inflation—to get their result. They show their work in this footnote on page 9-8 of the RIA:
Highly scientific! In other words, EPA took someone else’s paper, which studied environmental expenditures over three decades old (1971-1991), and applied them to a totally unrelated sector of the economy, the coal industry, and then utilized the old “plug and chug” method. This work wouldn’t survive peer review in a kindergarten class.
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Senate Again Votes Against Renewing Wind Subsidies
The Senate voted this week not to invoke cloture and proceed to a final vote on Senator Robert Menendez’s bill, S. 2204, that would repeal tax subsidies (of around $4 billion per year) and standard business deductions (of around $20 billion a year) for the five biggest oil companies and extend tax subsidies for a variety of renewable energy sources and energy efficiency technologies, including the production tax credit for wind power.
The vote was 51 to 47, with 60 votes required to invoke cloture. Forty-nine Democrats and two Republicans—Senators Olympia Snowe (R-Me.) and Susan Collins (R-Me.)—voted for cloture. Forty-five Republicans and four Democrats—Senators James Webb (D-Va.), Mary Landrieu (D-La.), Mark Begich (D-Alaska), and Ben Nelson (D-Neb.)—voted against cloture.
The Environmental Protection Agency on Tuesday, 27th March, released proposed New Source Performance Standards (or NSPS) to limit greenhouse gas emissions from coal and gas fired power plants. The rule will effectively ban the construction of new coal-fired power plants unless they include carbon capture and storage technology that is not commercially available and has poor prospects of ever becoming economically feasible. This is one of several rules EPA is writing in order to implement their 2009 finding that greenhouse gas emissions endanger public health and welfare and therefore must be regulated under the Clean Air Act.
The proposed new rule does not apply to existing power plants fueled by coal or natural gas or to plants that are under construction or have been permitted. However, the Clean Air Act’s section 111d requires that existing sources be regulated as well as new sources.
When asked during a press teleconference on Tuesday when rules for existing power plants might be issued, EPA Administrator Lisa Jackson replied, “We have no plans to address existing plants….” What she should have been asked by reporters was how her agency would respond when environmental pressure groups file suit in federal court to compel the agency to issue NSPS rules for existing power plants. A good follow-up question would be to ask whether anyone in her agency is talking to environmental pressure groups about filing a friendly suit that EPA could then settle in a friendly way.
Senator James M. Inhofe (R-Okla.) immediately announced that he would do everything he could to block or overturn the rule. The most likely route is to introduce a resolution of disapproval using the Congressional Review Act. However, that cannot be done until the rule becomes final, which is not likely to happen until next year.
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