President Trump this week signed an executive order that begins rolling back the climate actions taken by his predecessor. Making good on promises to cut regulations and restrictions on energy production, Trump told coal miners on stage with him, "you're going back to work."
There is much debate over whether that can happen. The price of renewables continues to fall, along with natural gas, and clean energy solutions are increasingly seen as economic engines as well as valued for their environmental aspects. Automation in the coal industry is also a factor. But if there is one certainty, it's that the White House's actions will set off a wave of litigation that could engulf the entirety of Trump's tenure.
The wide-ranging order takes many actions, requiring different levels of review. While some aspects are likely to be tied up in court for years, others went into effect immediately.
"No one should expect the Clean Power Plan to disappear immediately or anywhere in the near future. That is going to take significant time. ... People should count on a minimum of one year, and probably two years."
Tom Lorenzen
Crowell & Moring Partner
The order calls for a review of the Clean Power Plan, so it is still unclear precisely how the administration will move forward. It directs agencies to identify rules that are hampering domestic energy production, a process that will take months—followed by up to two years to pull the rules back, analysts told Utility Dive. But it also immediately rescinded a moratorium on new coal leases on federal lands, rolled back the use of a social cost of carbon in government decisions, undid a handful of Obama-era executive orders and eased methane restrictions on oil and gas operations.
"The most immediate impact is a lot of litigation," said Ari Peskoe, senior fellow in electricity law at the Harvard Law School Environmental Law Program Policy Initiative.
Crowell & Moring Partner Tom Lorenzen agreed: "No one should expect the Clean Power Plan to disappear immediately or anywhere in the near future. That is going to take significant time. ... People should count on a minimum of one year, and probably two years."
The Clean Power Plan
The signature environmental achievement of President Obama, the Clean Power Plan has for years been seen by pro-fossil fuel interests as the enemy of generators and many fossil-fuel reliant states. The rule, which aims to cut emissions from existing power plants 32% by 2030, is being challenged in the D.C. Circuit Court.
This week, the Department of Justice, on behalf of the EPA, asked the court to hold the case in abeyance—essentially put it on hold—while the agency conducts a review of the Clean Power Plan. In particular, they asked that the hold remain in place 30 days after the conclusion of the review "and any resulting forthcoming rulemaking."
The filing also served to notify the court of Trump's executive order, and urged the court to set aside the case, saying it would "promote judicial economy by avoiding unnecessary adjudication and will support the integrity of the administrative process."
The administration cannot simply eliminate the Clean Power Plan—it will require a rulemaking process, with comment period. "The EPA is going to have to figure out how it wants to undo that rule," said Lorenzen.
There are a few possibilities, including offering a more narrow rule, eliminating it, or even taking an aggressive approach towards eliminating the 2009 endangerment finding.
If the administration chooses to replace the CPP with a less stringent rule, it could end in a narrower regulatory package that would require only small efficiency improvements to existing coal plants. EPA Administrator Scott Pruitt wrote such an alternative plan in 2014.
But if the Trump Administration does not replace the CPP, the EPA could be at risk for lawsuits claiming that it is not fulfilling its obligation to regulate greenhouse gases, which the agency determined were a public health threat in the endangerment finding.
The Trump administration could respond in a variety of ways, including arguing that the EPA cannot regulate coal plants under two parts of the Clean Air Act (sections 111 and 112) simultaneously. The "double regulation" issue was a key point raised by petitioners in arguments against the CPP at the D.C. Circuit Court in September.
The administration could also seek to challenge the 2009 endangerment finding itself, but that would be an uphill battle, energy lawyers say, because they would have to prove in court that GHGs are not a public health threat. Pruitt has challenged the finding before, signing onto a legal challenge in 2012.
According to Peskoe, environmental advocates will now likely oppose the abeyance motion and ask the court to issue a decision. A lot of work has been done on this case, and a court may be loathe to toss that all away.
"So many weird things have happened in this case," said Peskoe. There was the Supreme Court stay of the Clean Power Plan early last year, the Circuit Court's decision to go straight to an en banc hearing, a full day hearing, and all against the political backdrop.
But on the other had, courts also “recognize reality," said Peskoe. "They may not want to issue a decision that will be undone by the administration ... why bother issuing what is essentially an advisory option Courts don't like to do that."
"Where it goes from there is anyone's guess,” he said.
The case could still even wind up at the Supreme Court, said Lorenzen. Even if the rule is replaced, environmental groups could challenge that immediately in the D.C. Circuit Court.
Immediate effects
There are more immediate impacts. Some may take agency notification, but they cannot be challenged. The order disbands an interagency work group on the social cost of carbon, "basically saying everything they produced is no longer official government policy," explained Peskoe.
To the extent an agency needs to use a social cost of carbon, they now have to go back to Office of Management and Budge guidance from 2003. The executive order means agencies will only look at carbon impacts accrued to the United States, rather than globally, and also calls for a reevaluation of the discount rate used.
”Both of those could have a dramatic impact on what the social cost of carbon is—presumably it would end up being much much lower, which is what the administration is trying to achieve here," said Peskoe.
Trump's decision also rescinds actions taken by President Obama, which the executive order said "have acted as a road block to energy independence." The order lifted a federal moratorium on new coal leases, and lifts restrictions on oil, gas and shale energy production.
"Certain things will happen quickly [and] most of it will take considerable time. ... We're talking about an endeavor that will occupy pretty much the entirety of President Trump's term."
Tom Lorenzen
Crowell & Moring Partner
The executive order also rescinds several reports on the Obama-era climate action plan, and eliminates a 2013 executive order on "Preparing the United States for the Impacts of Climate Change," as well as a 2013 presidential memorandum on "Power Sector Carbon Pollution Standards."
"Certain things will happen quickly," said Lorenzen. "Most of it will take considerable time. ... We're talking about an endeavor that will occupy pretty much the entirety of President Trump's term."
Will we always have Paris?
Conspicuously absent from the executive order is any mention of the United Nations Paris climate accord. A senior White House official says a decision on whether to stay or go is "still under discussion."
But the Clean Power Plan is described by some as the actionable part of the United States' commitment: Absent rules on existing power plants, the U.S. cannot meet promised emissions reductions. Others believe renewable energy has made such strides that, along with other regulations, the country could still deliver.
Ultimately, many of these decisions fit together. Eliminating the Clean Power Plan altogether would make the Paris agreement seem hollow.
"If they are going to go after the greenhouse gas endangerment finding, I think that increases the likelihood the administration withdraws from Paris," Lorenzen said. If CPP is replaced with a less aggressive rule, perhaps one targeting heat rate improvements, the country will likely stay.
"I think there is still division, within the administration, about how to approach Paris," he added.
