Lisa Jackson

Bed Bugs Now With Super Bug: Still Just a “Nuisance,” EPA?

by Michelle Minton on June 22, 2011 · 6 comments

in Health and Illness, Nanny State

As my colleague Angela Logomasini noted in a post in January, the EPA has rebuffed the desperate pleas of lawmakers and residents to un-ban certain pesticides for the treatment of bed bugs. When asked why Ohio’s Gov. Ted Strickland’s request for an emergency exemption to use two very effective, but banned pesticides to fight the parasites, Lisa Jackson, head administrator of the Environmental Protection Agency replied that bed bugs were simply “a nuisance.” “We’re lucky – bed bugs don’t carry disease. But if you have to sleep in a bed and worry about being bitten all night, it sort of messes with your mind. And we get that,” said Jackson. How nice.

Clearly Ms. Jackson hasn’t spent much time speaking with people who have had bed bugs. More than a mere nuisance, they can force families to shell out thousands of dollars in repeat treatments, hospital visits (if reactions to the bites are severe), medication such as antibiotics, damaged relationships, damaged psyches, and damaged careers. Despite her sympathy, Ms. Jackson denied Ohio’s request for an emergency exemption.

At the time, Jackson believed that bed bugs do not carry disease. Unfortunately, we know better now. A recent study out of Canada found bed bugs carrying the drug-resistant strain of the Staphylococcus bacterium (also known as the MRSA and a “superbug”). While they have not been able to conclusively prove that the bed bugs are spreading the disease to their human hosts, their carrying the disease while causing the host to scratch the skin certainly seems like it would increase the likelihood of infection. In an article in the June 2011 issue of Emerging Infectious Disease, a CDC public health journal, discussed the possible correlation between increasing rates of MRSA infection and increasing infestations of bed bugs.

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TCEQ to EPA: Don’t Mess with Texas

by Marlo Lewis on August 6, 2010

in Global Warming, Legal

In a blistering letter published earlier in the week, the head of Texas’s environmental agency and the State’s attorney general told the U.S. Environmental Protection Agency (EPA): ”Texas has neither the authority nor the intention of interpreting, ignoring, or amending its laws in order to compel the permitting of greenhouse gas regulations.”

The letter, by Texas Commission on Environmental Quality (TCEQ) Chairman Bryan Shaw and Attorney General Gregg Abbott, comes hard on heels of EPA’s denial of 10 petitions (including one from the State of Texas) to reconsider EPA’s endangerment rule. That rule — the agency’s response to the Supreme Court’s 5-4 decision in Massachusetts v. EPA – is both trigger and precedent for potentially dramatic and far-reaching Clean Air Act restrictions on fossil energy production and use.

More pertinently, Shaw and Abbott sent their letter on August 2, 2010, the deadline EPA had set in its Final Tailoring Rule (p. 31582) for States to explain how they plan to apply Clean Air Act permitting programs to stationary sources of greenhouse gases. Instead, the Texas officials all but told EPA to go jump in the lake. 

Tailoring Absurdity

EPA adopted the Tailoring Rule to fix a problem of its own making. By adopting the endangerment rule, EPA obligated itself to establish greenhouse gas emission standards for new motor vehicles. The standards make carbon dioxide (CO2) a “regulated air pollutant,” which in turn makes any “major stationary source” of CO2 “subject to regulation” under the Clean Air Act’s Prevention of Significant Deterioration (PSD) pre-construction permitting program and Title V operating permits program. 

The problem is that literally millions of  hitherto unregulated entities qualify as “major” sources of CO2 under those programs. The “major” source “applicability threshold” for PSD is a potential to emit 250 tons per year (tpy) of a regulated air pollutant. The threshold for Title V is even lower — a potential to emit 100 tpy. Whereas only large industrial facilities emit bona fide air pollutants in those quantities, millions of small entities never before subject to Clean Air Act permitting requirements — big box stores, office buildings, apartment complexes, restaurants, hospitals, schools — emit CO2 in the threshold amounts.

Applying the Clean Air Act to greenhouse gases thus produces what EPA itself describes as “absurd results.” For example, EPA and its State counterparts would have to process an estimated 41,000 PSD permits per year (up from 280) and 6.1 million Title V operating permits per year (up from 15,000). The ensuing “permit gridlock” would clog up environmental enforcement, stifle new construction, and force millions of firms to either operate illegally or close down. All on President Obama’s watch; all in the midst of a deep recession.

Rather than draw the reasonable conclusion that Congress did not intend to regulate greenhouse gases via the Clean Air Act, EPA decided that Congress must have intended for the agency to ”tailor” — that is, amend — the Act so the agency can regulate greenhouse gases without wrecking the economy. So, while the law specifies 100/250 tpy as the applicability thresholds for the permitting programs, the Tailoring Rule sets the cutoff at 100,000 tpy over the next two years and at not less than 50,000 over the next six years.

In addition, under the Tailoring Rule, modifications to an existing source won’t be considered “significant” — that is, won’t trigger the PSD process — unless the changes increase emissions by 75,000 tpy.

The Texas environmental chairman and AG aren’t buying it:

You have declared that EPA’s decision to enact automobile tailpipe emission limits for greenhouse gases pursuant to Title II of the federal Clean Air Act renders such gases immediately ”subject to regulation” for all purposes under the Act, including Title I Prevention of Significant Deterioration (PSD) pre-construction permitting program  and the Title V operating permit program. Simultaneously, however, you recognize that permitting greenhouse gases under the Act is “absurd.” . . . We agree.

They continue:

In order to avoid the absurd results of EPA’s own creation, you have developed a “tailoring rule” in which you have substituted your own judgment for Congress’s as to how deep and wide to spread the permitting burden.

And a bit later:

Instead of acknowledging that congressionally set emission limits [applicability thresholds] preclude the regulation of greenhouse gases, you instead re-write those statutorily-established limits . . . .

Problem Unsolved

Okay, now we get to the meat of the matter. PSD and Title V are mostly administered by States, not by EPA, and most State Implementation Plans (SIPs) define “major” emitting facility exactly as the Clean Air Act does. This means that even if the Tailoring Rule shields small entities from PSD and Title V regulation by EPA, it would not shield them from regulation by State agencies. EPA discussed this problem in its Proposed Tailoring Rule (p. 33542). ”Virtually all of [the EPA-approved SIPs] establish the PSD permitting threshold at the 100/250-tpy level,” EPA noted. Indeed, ”a few States have adopted lower permitting threshold levels.” In addition, “virtually all EPA-approved SIPs establish the significance level” for modifications triggering PSD “at zero” emissions in the case of previously unregulated air pollutants — not at 10,000 tpy, as EPA initially proposed, much less at 75,000 tpy, as the Final Rule stipulates.

Initially, EPA proposed to withdraw federal approval from those portions of SIPS incorporating the older thresholds and significance levels. This would mean, however, that the lower thresholds would “remain on the books under State law, and sources therefore remain subject to them as a matter of State law” (Proposed Tailoring Rule, p. 55343). In short, the regulatory nightmare would continue. For further discussion, see Peabody Energy’s comment on the Proposed Tailoring Rule.

Of course, States have the option to revise their SIPs and amend their clean air laws. But that could take years. Thus, notwithstanding EPA’s “tailoring,” small entities would find themselves “subject to regulation” under State PSD and Title V requirements on January 1, 2011, when the agency’s greenhouse gas tailpipe emission standards go into effect. As the Final Tailoring Rule observes, “Commenters stated that States would need to undertake a regulatory and/or legislative process to change the threshold in their state laws which they could not complete before the laws would otherwise require issuance of operating permits to GHG sources” (p. 31583).

Semantics Rule?

So what is EPA’s solution? Instead of changing the definition of “major stationary source,” EPA is changing the definition of “subject to regulation.” The agency, “by interpretation,” now defines “subject to regulation” as not including a “major source” of greenhouse gases unless the source has a potential to emit 100,000 tpy on a CO2-equivalent basis. EPA crows that “we find no substantive difference” between how the initially-proposed rule and how the final rule “tailors” the permitting requirements. EPA says that States similarly, “by interpretation,” can redefine “subject to regulation,” allowing them to exempt small sources from PSD and Title V without changing their SIPs or laws: 

Whether we add [higher] GHG thresholds directly to the definition of “major source” (as we proposed), or alternatively, expressly add and define the term “subject to regulation” [so that it only applies to sources emitting at least 100,000 tpy], both approaches revise the definition of “major source” to implement the Tailoring Rule. Accordingly, we adopt the later approach to facilitate state implementation of the final rule through an interpretation of existing state part 70 programs.

If you are confused as to how redefining “subject to regulation” can produce the same substantive result as redefining “major source” yet not similarly require States to change their SIPs or laws, you are not alone. It’s this attempt to turn law into a semantic game that the Texas officials refuse to play.

They write:

In the Tailoring Rule you have asked TCEQ to report to you by August 2, 2010 whether it would “interpret” the undefined phrase “subject to regulation” in TCEQ Rule 116.12 consistent with the newly promulgated definition of EPA Rule 51.166 in all its specifics and particulars. . . .In other words, you have asked Texas to agree that when it promulgated its air quality permitting program rules for pollutants “subject to regulation” in 1993, that Texas really meant to define the term “subject to regulation” as set forth in the dozens of paragraphs and sub-paragraphs of EPA Rule 51.166, first promulgated in 2010.

TCEQ Rule 116.12 was last amended in 2006. It “adopts” the Clean Air Act “by reference” — but only as the Act existed at the time of adoption. To adopt subsequent changes made by EPA, TCEQ would have to amend Rule 116.2 through a formal rulemaking process. Adopting such changes by mere act of “interpretation” would delegate more authority to EPA than the Texas Constitution allows.  

In addition, the Texas officials argue, “TCEQ is also precluded from adopting EPA’s newly-minted definition of “subject to regulation” by the “express terms of the Texas Government Code, which requires public notice of agency rulemaking.” They explain:

When the TECQ promulgated Rule 116.12 in 1993, or even when it last amended the rule in 2006, it had no intention of enacting a permitting program for greenhouse gases. Consequently, TCEQ had no reason to (nor did it) give public notice of any such intent. Obviously, Texans concerned with greenhouse gas permitting could not have known to participate and comment on the decision to require permits for pollutants “subject to regulation” in 2006, when the EPA first discovered greenhouse gases were “subject to regulation” in 2010. It should go without saying that the nearly infinite expansion of Texas’ permitting programs to include greenhouse gases with no state-level rulemaking at all would not satisfy Texas or federal law requiring notice and an opportunity to be heard.

Of course, one could say that the whole point of the Supreme Court’s decision in Massachusetts v. EPA, which pushed the agency to issue an endangerment rule, and the ensuing cascade of CO2 controls was to bypass the democratic process and confront the public with regulatory fait accompli.

Another Bite at the Apple?

It will be interesting to see how all this plays out. If Texas sticks to its guns, EPA may simply take over the Texas PSD program, in whole or in part, through a federally-imposed Federal Implementation Plan (FIP). Florida, for example, told EPA it could not make the regulatory changes in time, so EPA would just have to take over the Florida program. EPA reportedly is working on a “backstop rule” authorizing the agency to take over State permitting of greenhouse gases on a temporary basis (Environmental NewsStand, August 5, 2010, subscription required).

However, what if Texas still refuses to cooperate? Would EPA sue? Such a case might work its way up to the Supremes. The Court might then have to face the core issue it ducked in Mass. v. EPA – whether Congress intended for EPA to regulate greenhouse gases under the Clean Air Act as a whole, including PSD, Title V, and the national ambient air quality standards (NAAQS) program. The Court would have an opportunity to reconsider Mass. v. EPA in light of the absurd results to which it has led. A long shot — but a consummation devoutly to be wished.

Greenhouse Protection Racket

by Marlo Lewis on July 6, 2010 · 1 comment

in Odds & Ends

Climate policymaking in our Nation’s capital often resembles the heavy-handed dialogue of old-time mobster films.

“Are you gonna come along quietly, or do I have let the California Air Resources Board (CARB) muss ya up?” That was pretty much the line White House Environment Czarina Carol Browner took to obtain the auto industry’s support for the joint EPA/National Highway Traffic Safety Administration (NTSHA) greenhouse gas (GHG) emission/fuel economy standards rule. EPA is now in a position both to determine the stringency of fuel economy standards for the auto industry and to set climate policy for the nation. Yet the Clean Air Act provides no authority to regulate fuel economy and says nothing about greenhouse gases or global climate change. ”Badges? We don’t need no stinking badges.”  

Modus Operandi: Threaten in Order to Remove the Threat — for a Price

Here’s how the regulatory mugging went down. 

In February 2009, EPA Administrator Lisa Jackson commenced a rulemaking to reconsider Bush EPA Administrator Stephen Johnson’s denial of California’s request for a waiver to establish its own greenhouse gas emission standards program. Because the waiver would also allow other states to adopt the California program, because GHG emission standards are mainly fuel economy standards by another name, and because automakers would have to reshuffle the mix of vehicles delivered for sale in each “California” state to achieve the same average fuel economy in those states, Jackson’s proceeding threatened to subject automakers to inefficient, consumer-thwarting, regulatory patchwork.

In May 2009, Czarina Browner conducted secret negotiations with automakers, CARB Chairman Mary Nichols, and major environmental groups. Browner required participants to take a vow of silence and forbade anyone to take notes, violating the Presidential Records Act. The closed-door negotiations produced an “historic agreement” whereby automakers would support the EPA/NHTSA GHG/fuel economy standards rule and California and other states would deem compliance with the federal standards as compliance with their own.

In addition, observes Rep. Darrel Issa (R-Calif.), at the same time the Browner-led negotiations were taking place, ”the government was also engaged in bailout talks with General Motors (GM) and Chrysler,” resulting in “an ownership stake for the federal government of 61% of GM and 8% of Chrysler, respectively.” Whether Browner literally made the auto industry an offer it could not refuse, with the sweetener of financial assistance also contingent on the industry’s embrace of GHG regulation, we may never know.

This much is clear. By granting California’s request for a waiver, EPA created the threat of a regulatory patchwork, enabling the White  House to offer ”protection” in the form of the joint GHG/fuel economy standards rule. The protection “fee” was the auto industry’s unquestioning support for the joint rule and its prerequisite, EPA’s endangerment rule.

Thus, the Auto Alliance became the key industry lobby opposing Sen. Lisa Murkowski’s resolution to overturn EPA’s endangerment rule. The Alliance warned that if the endangerment finding were overturned, the “historic agreement” would unravel, confronting automakers with “the alarming possibility of having to comply with multiple sets of conflicting fuel economy standards.” 

That is correct, but only because EPA Administrator Jackson, reversing her predecessor’s decision, granted California a waiver to establish GHG emission standards for new motor vehicles. An obvious solution would be to overturn the waiver. After all, the Energy Policy and Conservation Act clearly prohibits states from adopting laws or regulations ”related to fuel economy,” and the California motor vehicle emissions program is basically a de facto fuel economy program. The waiver effectively repeals federal law, violating the separation of powers. Not that you’ll ever hear about that from Government Motors. Mum’s da woid.

Mirage of Regulatory Certainty

The auto industry is not the only target of the greenhouse protection racket. For years, the greenhouse gang has been saying that only cap-and-trade can end the intolerable ”regulatory uncertainty” facing the electric power sector, energy-intensive manufacture, and other CO2 emitters. But who created the uncertainty in first place if not the self-same advocates of cap-and-trade? If they were serious about relieving uncertainty, they would disavow the regulatory schemes for which they have been campaigning.

Businesses lobbying for cap-and-trade in the name of certainty should read the fine print. The Waxman-Markey and Kerry-Boxer bills, for example, have multiple escalater clauses setting the stage for dramatic increases in regulatory stringency well beyond the bills’ explicit emission reduction targets.  Similarly, the bills’ “findings” presenting the “scientific” rationale for cap-and-trade are not mere rhetorical fluff but precedents for litigation targeting emission sources considerably smaller than those explicitly identified as “covered entities.” Enact such legislation, and the only certainty is that regulatory burdens will grow unpredictably.

Too Clever by Half

Last but not least, cap-and-taxers sell their policy as protection from litigation-driven greenhouse gas regulation under the Clean Air Act.  The sales pitch goes something like this: “Pretty nice company you got deah, shame if sumpin’ bad waz to happen to it. Everybody needs protection. You need protection. It’s called Kerry-Lieberman.” Note the familiar pattern. The gang pushing cap-and-trade as protection from EPA are the same folks who sued EPA to regulate greenhouse gases and who vilified Sen. Murkowski and others for attempting to stop EPA.

This is all too clever by half. If cap-and-trade dies in the 111th Congress, which seems increasingly likely, the Obama administration and its allies on the Hill will take sole ownership of the compliance costs, job and GDP losses, and “absurd results“ arising from EPA regulation of greenhouse gases under the Clean Air Act. 

Democratic leaders may not recognize it yet, but they have painted themselves into a corner. They have become the Party of Endangerment — the party endangering the U.S. economy by championing the endangerment rule, with all its cascading regulatory effects.

Thank You CBD: Another Reason to Nix EPA Endangerment Finding

by Marlo Lewis on June 3, 2010 · 2 comments

in Global Warming

Twice during the past six months, the eco-litigators at the Center for Biological Diversity (CBD) have underscored the political necessity for Congress to overturn EPA’s endangerment finding.

Yes, that is very far from CBD’s intention. CBD is a fervent defender of the endangerment finding, the December 2009 rulemaking in which EPA concluded that greenhouse emissions endanger public health and welfare.

The endangerment finding compels EPA to establish greenhouse gas emission standards for new motor vehicles, which in turn makes carbon dioxide (CO2) a “regulated air pollutant”  under the Clean Air Act, which in turn makes ”major” stationary sources of CO2 ”subject to regulation” under the Act’s Prevention of Significant Deterioration (PSD) pre-construction permitting program and Title V operating permits program. CBD must be thrilled by the endangerment finding and the regulatory cascade it has triggered.

CBD wants EPA to follow through on all the regulatory commitments logically entailed by the endangerment finding and CO2′s new status as a “regulated air pollutant.” But that’s where things get dicey for President Obama and his congressional allies. Once the regulatory genie is out of the bottle, Obama officials may not be able to control it.

Even EPA acknowledges that applying the Act’s permitting programs to CO2 leads to “absurd results.” For example, EPA and its state counterparts would have to process 41,000 PSD permit applications per year (instead of 280) and 6.1 million Title V permits per year (instead of 14,700). The resulting administrative quagmire would paralyze environmental enforcement, slam the brakes on development, and force millions of firms to operate in legal limbo. A more potent anti-stimulus package would be hard to imagine. 

To avoid this red ink nightmare, EPA has issued a Tailoring Rule that exempts small CO2 emitters from the Act’s permitting programs for six years. However, nothing in the statute authorizes EPA to suspend or modify the permitting requirements. In reality, EPA’s Tailoring Rule is an amending rule. It’s anybody’s guess whether courts will uphold this breach of the separation of powers.

Even if they do, the endangerment finding will still endanger the U.S. economy and our constitutional system of separated powers and democratic accountability. Thank you, CBD, for bringing this peril to light!

Last December, CBD petitioned EPA to establish national ambient air quality standards (NAAQS) for greenhouse gases set below current atmospheric levels. CBD is only acting on the obvious implication of EPA’s assertion that endangerment comes from the “elevated concentration” of greenhouse gases in the atmosphere.

Why should Obama and congressional leaders worry? The Clean Air Act requires states to come into attainment with a primary (health-based) NAAQS within five or at most 10 years. Yet not even a global depression lasting several decades would suffice to lower CO2 concentrations from today’s level (390 parts per million) to the stabilization target (350 parts per million) demanded by CBD and its co-petitioners. Because EPA may not take compliance costs into account when establishing NAAQS, the endangerment finding sets the stage for eco-litigators to transform the Act into a de-industrialization mandate.  No elected official wants to take ownership of so crazy a policy. If CBD prevails, however, Obama and the Democrats — the Party of Endangerment — will be left holding the bag. 

Yesterday, CBD filed suit to overturn EPA Administrator Lisa Jackson’s reconsideration of her predecessor Stephen Johnson’s memorandum determining when a pollutant is “subject to regulation” under the PSD program. Jackson’s reconsideration held that a pollutant is subject to regulation not when EPA finalizes an emissions control rulemaking but when the rule takes effect. Since EPA’s greenhouse gas motor vehicle standards rule does not take effect until January 2011, Jackson concluded that EPA may not regulate greenhouse gases from stationary sources until then. CBD says EPA should have started already to regulate large emitters via PSD.

CBD’s lawsuit makes EPA regulation of greenhouse gases a real-time issue for this Congress, not just a post-election issue for the next Congress. It increases the pressure on Democrats to get the monkey off their back. If courts strike down Jackson’s reconsideration, they will be more likely to strike down the Tailoring Rule, which undeniably flouts statutory language. Courts will also be more likely to look favorably on CBD’s NAAQS petition, which simply demands that EPA, having made an endangerment finding, follow the letter of the law.   

Democratic Senators who don’t want to bet their political futures on EPA’s ability to control the cascading effects of greenhouse gas regulation under the Clean Air Act – or who simply believe that climate policy is too important to be made by non-elected bureaucrats, trial lawyers, and activist judges appointed for life – will soon get their opportunity.

On June 10, the Senate will vote on a resolution of disapproval (S.J.Res.26), sponsored by Alaska Sen. Lisa Murkowski, to nullify the legal force and effect of EPA’s endangerment finding. If enacted, S.J.Res.26 will:

  1. Avert the threat of an administrative meltdown under the PSD and Title V programs.
  2. Avert the threat of sky-is-the-limit, money-is-no-object regulation of greenhouse gases via the NAAQS program.
  3. Avoid the need for EPA to play lawmaker and ’amend” a statute it is supposed merely to administer.

Most importantly, enacting Sen. Murkowski’s resolution will ensure that the big decisions about the content and direction of national policy are made by the people’s representatives, as the Constitution requires.

What Happens If Congress Blocks EPA?

by Marlo Lewis on March 9, 2010 · 2 comments

in Global Warming

That’s the topic of this week’s National Journal energy blog. In my contribution, I argue that EPA has been playing a mischievous game that endangers democracy, and that Sen. Lisa Murkowski’s legislation to veto the agency’s endangerment finding would remove this threat. 

In a Feb. 22 letter to Sen. Jay Rockefeller (D-WV), EPA Administrator Lisa Jackson warns that enactment of the Murkowski legislation would scuttle the joint EPA/National Highway Traffic Safety Administration (NHTSA) greenhouse gas/fuel economy rulemaking, which in turn would compel the struggling auto industry to operate under a “patchwork quilt” of state-level fuel-economy regulations.

Ms. Jackson neglects to mention that the patchwork threat exists only because she, reversing Bush EPA Administrator Stephen Johnson’s decision, granted California a waiverto implement its own GHG/fuel economy program. Had Jackson reaffirmed Johnson’s denial, there would be no danger of a patchwork, hence no ostensible need for the joint EPA/NHTSA rulemaking to avert it.

As my blog post explains, EPA should not have approved the waiver in the first place. The California GHG/fuel economy program violates the Energy Policy and Conservation Act, which prohibits states from adopting laws or regulations “related to” fuel economy. Worse, the waiver creates a reverse right of preemption whereby states may nullify federal law within their borders — an affront to the Supremacy Clause. 

Specifically, the waiver would allow California, and other states opting into the California program, to nullify within their boundaries the reformed national fuel economy program that Congress enacted in the 2007 Energy Independence and Security Act (EISA). That leads straight to a patchwork of state-by-state compliance regimes inimical to a healthy auto industry.

The game EPA is playing is a classic case of bureaucratic self-dealing.

First, EPA endangers the U.S. auto industry by authorizing states to flout federal law and the Constitution. Then, EPA proposes to avert disaster via a rulemaking that just happens to put EPA in the driver’s seat in regulating fuel economy – a power Congress never delegated to EPA when it enacted and amended the Clean Air Act.

Nor is that all. The joint GHG/fuel economy regulation will compel EPA to regulate CO2 from stationary sources – another power Congress never delegated to EPA. By expanding its control over the transport sector, EPA will then have to expand its control over manufacturing, power generation, and much of the commercial and residential sectors, too, because all emit CO2.

In addition, the motor vehicle GHG rule sets the stage for EPA to “tailor,” that is amend, the Clean Air Act so that the agency can delay imposing pre-construction and operating permit requirements on small business, which would surely ignite a political backlash.

So thanks to the endangerment finding, EPA not only gets to play in NHTSA’s fuel-economy sandbox, and extend its tentacles throughout the economy, it also gets to play lawmaker, violating the separation of powers.

In light of all the new powers EPA now expects to wield, it is hardly surprising that EPA never made the strong case against Clean Air Act regulation of CO2 in Massachusetts v. EPA. Here’s what EPA should have argued:

  • EPA cannot regulate GHG emissions from new motor vehicles under Sec. 202 of the Clean Air Act without regulating CO2 under the Act as a whole. 
  • Aplying the Act as a whole to CO2 leads ineluctably to “absurd results” that contravene congressional intent.
  • Therefore, Congress could not have intended for EPA to regulate GHG emissions under Sec. 202.

Did EPA throw the fight in the 11th round? I dunno, but losing the Massachusetts case was surely sweet victory to those in the agency who long to regulate America into a ”clean energy future.” The Massachusetts decision laid the groundwork for EPA to deal itself into a position to bypass the people’s elected representatives, impose its will on the auto industry, and, in time, dictate national climate and energy policy.

What happens if Congress enacts Sen. Murkowski’s resolution, nixes the endangerment finding, and mothballs the GHG/fuel economy rule? The authority to make law and national policy returns to where the framers of the Constitution intended — the people’s elected representatives.

Will Cass Sunstein stick up for small business, or bless EPA’s legal hair splitting?

by Marlo Lewis on January 21, 2010 · 3 comments

in Energy, Global Warming

Today, Reps. Lamar Smith (R-TX), Sam Graves (R-MO), Trent Franks (R-AZ), and Lynn Westmoreland (R-GA) sent a letter to Office of Information and Regulatory Affairs (OIRA) Administrator Cass Sunstein sharply critical of EPA’s December 7, 2009 finding that “air pollution” from carbon dioxide (CO2) and other greenhouse gases (GHGs) endangers public health and welfare. 

“On the basis of EPA’s endangerment finding,” the legislators warn, “virtually every economic activity undertaken in America stands to come under the thumb of federal regulation.” They explain: “These actions begin with EPA’s and the Department of Transportation’s proposed new light vehicle emission standards, continue through greenhouse gas (GHG) preconstruction and operating permit requirements for stationary sources and extend as far as the mind can contemplate.” They continue: “In these ways, EPA threatens to burden our economy with vastly expanded regulation not contemplated by Congress when it passed the Clean Air Act.” 

Yes, indeed. As I discuss here and here, EPA’s endangerment finding starts a regulatory cascade that could (1) subject tens of thousands of previously unregulated small businesses to Clean Air Act (CAA) Prevention of Significant Deterioration (PSD) pre-construction permitting regulations, (2) subject millions of small businesses to CAA Title V operating permit requirements, and (3) compel EPA to establish national ambient air quality standards (NAAQS) that would effectively require the United States to de-industrialize. The Supreme Court pushed EPA to make the endangerment finding in its April 2007 Massachusetts v. EPA decision.

The four Members of Congress ask OIRA chief Sunstein to make EPA convene a Small Business Advocacy Review Panel to develop and evaluate regulatory alternatives to mimimize the endangerment finding’s impacts on small business. Until and unless EPA does this, the lawmakers say, the endangerment finding should be “withdrawn.”

The representatives acknowledge that EPA’s proposed October 2009 Tailoring Rule  “seeks to delay for a handful of years the imposition of requirements on sources emitting less than 25,000 tons of carbon dioxide per year.” However, this fix is by design temporary, and it is legally dubious, since EPA would be flouting clear statutory language. Under the CAA, entities must obtain a PSD permit in order to construct or modify a facility with a potential to emit 250 tons per year of a CAA-regulated air pollutant, and a Title V permit in order to operate a facility with a potential to emit 100 tons per year.

EPA estimates that if these provisions are enforced as written, the number of entities applying for PSD permits would jump from 280 to 41,000 per year, and the number applying for Title V permits would jump from 14,700 to 6.1 million per year. The flood of permit applications would overwhelm agency administrative resources, the permitting programs would implode under their own weight, construction activity would grind to a halt, and millions of firms would find themselves in legal limbo — all in the midst of the worst economic downturn since the Great Depression.  

It will be interesting to see how Sunstein responds to the lawmakers’ letter. Will he stick up for small business and honor the spirit of the Regulatory Flexibility Act (RFA), or will he bless EPA’s evasive legal semantics? 

Under the RFA, agencies are to convene a small business review panel unless the agency head certifies that the proposed regulation will not have a “significant impact upon a substantial number of small entities.”  In a recent year, each PSD permit on average cost $125,120 and 866 burden hours for sources to obtain (just the paperwork and administrative costs, exclusive of any associated technology investments). The going rate for Title V administrative fees is $43.75 per ton, implying a virtual carbon tax (exclusive of administrative expenses) of $4,375 for a small business emitting 100 tons of CO2 per year. The Tailoring Rule estimates (p. 55338) that if small sources of CO2 must comply with the law as written, rather than as doctored by EPA, they will incur an expense of more than $38 billion just for Title V compliance over the next six years.  A significant economic impact by any standard.

Note also that the $38 billion figure refers just to the direct expenses small firms would incur to comply with Title V. It does not include the reduced output and job losses due to the diversion of resources to regulatory compliance. Nor does it include the loss of investment in firms that, due to their sheer number, face years of delay and uncertainty in obtaining permits to build or operate their facilities.

The endangerment finding is what tees up all these costs and consequences, so you’d think it would be a no brainer that it has ”significant impact upon a substantial number of small entities.”

Well, EPA says otherwise. In the Endangerment Finding (p. 66545), Administrator Lisa Jackson certifies that EPA’s findings “do not in-and-of-themselves” impose new requirements on small entities. Hence, there’s no need for an RFA review panel. Similarly, EPA’s GHG motor vehicle standards proposal (p. 49628) certifies that it would not have a significant impact on a substantial number of small entities, since the standards would apply to automakers, very few of which are small businesses.

By making new cars more costly, however, the rule could adversely affect thousands of auto dealers, most of whom are small businesses. EPA says not a word about that potential impact. More importantly, the GHG motor vehicle standards are what directly trigger the PSD and Title V requirements.

EPA says the Tailoring Rule (p. 55349) won’t have a significant impact on a substantial number of small entities, because it “will relieve the regulatory burden associated the PSD and Title V operating programs for new and modified major sources that emit GHGs, including small businesses.” So EPA acknowledges there is a burden to be relieved — a PSD/Title V burden. Where does that come from?  The endangerment finding and the GHG motor vehicle emissions rule. Yet EPA claims those actions have no impact of any consequence for small business.   

Isn’t legal hair-splitting grand? Of course, the findings “in-and-0f-themselves” regulate nothing — but they compel the adoption of GHG motor vehicle standards under CAA Sec. 202, which then automatically trigger pre-construction permitting requirements under Secs. 160-160 and operating permit requirements under Secs. 501-507.

The endangerment finding also sets the stage for regulation of GHG emissions from motor fuels under CAA Sec. 211, non-road engines and vehicles under Sec. 231, the establishment of GHG new source performance standards (NSPS) for scores of industrial source categories under Sec. 111, and the establishment of economy-wide NAAQS regulation of GHGs under Secs. 107-110.  ”Yes, Your Honor, I pulled the trigger, but I am innocent; the bullet killed the man!”

And if litigation and the logic of the CAA compel EPA to establish NAAQS for CO2 and other GHGs, which could easily qualify as the most expensive rulemaking in history, you can bet your bottom dollar what EPA will say. There’s no significant impact on a substantial number of small businesses, because NAAQS “in-and-of-themselves” don’t regulate anybody. The actual regulation of businesses large and small will be done by the states, through their State Implementation Plans (SIPs). “Once the rockets are up who cares where they come down, that’s not my department,” says Wernher Von Braun.

Small business clearly needs an advocate in the room and at the table whenever EPA deliberates about any regulatory action pertaining to greenhouse gases and CO2. Congress enacted the RFA to protect small business from regulatory excess. Right now it’s not working. Cass Sunstein has an opportunity to ensure that small businesses have a say in regulatory decisions affecting their very survival. He should seize it.

LibertyWeek 62: Soak the Rich, Reap the Wind

by Richard Morrison on September 28, 2009

in CEI Projects, Features, Podcast, Zeitgeist

Your host Richard Morrison welcomes returning guest co-host Jeremy Lott of the Capital Research Center and technical producer Ryan Young as special guest commentator for Episode 62 of the LibertyWeek podcast. We start with the semi-proposed allegedly not-a-bailout of the newspaper industry, Steven Chu’s condescending views on energy policy and Google’s copyright troubles in France. We then look at the what soaking the rich has done to New York’s finances, Obama’s presence at the UN and a good old fashioned Washington, D.C. corruption scandal.

Will Lisa Jackson turn the Clean Air Act into a gigantic de-stimulus package?

by Marlo Lewis on February 19, 2009

in Deregulate to Stimulate, Energy, Global Warming, Legal

Earlier this week, in a letter to Sierra Club climate council David Bookbinder, EPA Administrator Lisa Jackson said the Agency would reconsider, via a notice-and-comment rulemaking, a Bush-EPA memorandum interpreting regulations that determine whether carbon dioxide (CO2) is currently subject to emission controls under the Clean Air Act’s Prevention of Significant Deterioration (PSD) pre-construction permitting program. [click to continue…]

NADA report proves California waiver would create regulatory patchwork

by Marlo Lewis on February 13, 2009 · 2 comments

in Energy, Global Warming, Legal, Mobility

A front-burner issue facing Environmental Protection Agency (EPA) Administrator Lisa Jackson is whether to grant a waiver under the Clean Air Act allowing the California Air Resources Board (CARB) to implement first-ever greenhouse gas (GHG) emission standards for new motor vehicles. Thirteen other states are poised to adopt the CARB program if Jackson grants the waiver. In all, about 40% of the U.S. auto market would come under the CARB rules.

Jackson’s predecessor, Stephen Johnson, rejected CARB’s application  in December 2007.  His reasons, published in the Federal Register in March 2008, may be summarized as follows. EPA’s historic practice has been to grant CARB waiver requests to address air pollution threats arising from circumstances specific to California–its topography, regional meteorology, and number of vehicles. In contrast, global climate change is, well, global. Conditions associated with global climate change in California are not sufficiently different from those in other states to justify a separate emissions program.

This argument, which is tantamount to saying that EPA won’t allow CARB to combat global warming because global warming is bad for people everywhere, predictably elicited scorn from California politicians and environmental groups.

“Patchwork Proven,” a new report by the National Automobile Dealers Association (NADA), presents two compelling arguments against granting the waiver that Johnson should have made.

First, granting the waiver would violate the Energy Policy and Conservation Act (EPCA), which prohibits states from adopting laws or regulations “related to fuel economy.” Yes, I’m well aware that in Central Valley Chrysler-Jeep, Inc. v. Goldstone (2006), the U.S. District Court for Eastern California held that EPCA does not preempt CARB from establishing GHG standards for new motor vehicles. However, the Court’s reasoning was spurious, and Johnson should not have given it a free pass.

The CARB emissions program is essentially fuel economy regulation by another name. CO2 comprises 97% of the GHG emissions from motor vehicles. Since there is no commercial technology for capturing or filtering out motor vehicle CO2 emissions, the chief way to decrease CO2-equivalent grams per mile (that’s how the CARB GHG standards are calibrated) is to decrease fuel consumption per mile, i.e., increase fuel economy.

As “Patchwork Proven” points out, the relationship between fuel economy and tailpipe CO2 emissions is so close that EPA tests compliance with federal fuel economy standards by measuring vehicular CO2 emissions. The bottom line: “Absent a significant increase in new vehicle fleet fuel economy, it is impossible to comply with CARB’s regulation.” So the CARB emissions program is substantially “related to fuel economy.” As such, it is prohibited by EPCA.

Alas, in this day and age of judicial activism and global warming hysteria, we should not expect Jackson to pay heed to the spirit of EPCA.  However, she and other Obama Administration officials should be worried about havoc that the waiver would wreak on the distressed U.S. auto industry.

CARB and its allies repeatedly deny that granting the waiver would create a regulatory “patchwork,” with automakers required to comply in different ways in different states. According to them, there would be at most two programs: the federal program and the California program.  A dual system of regulating air pollution from vehicles has been in place since the start of the Clean Air Act. Vehicles built to federal standards are “federal cars” and vehicles built to CARB standards are “California cars.” Automakers have had no trouble building  cars that meet two different emission standards. Promulgating GHG emission standards would merely update a system that has worked well for decades, CARB contends.

The fundamental flaw in this argument is that CO2 is not like the air-quality damaging pollutants subject to existing EPA and CARB emission standards.  For smog-forming pollutants such as nitrogen oxides, both EPA and CARB specify how many grams per mile individual vehicles may emit. That’s not how CARB regulation of GHG emissions would work. There would not be two types of vehicles, “California” and “federal.” Rather, the CARB standards specify the CO2-equivalent grams per mile that each automaker must attain on average for the fleet it delivers for sale. In other words, the CARB program implicitly specifies fleet-average fuel economy.

This is a radical departure from previous EPA and CARB emission standards, and it inexorably produces a regulatory patchwork.

Here’s why. Consumer preferences and the corresponding mix of vehicles delivered for sale differ from state to state. For example, in 2007, the Dodge Ram (with a fuel economy rating of 18.7 mpg) accounted for 20.66% of all Chrysler vehicles sold in California, but only 9.46% of all Chrysler vehicles sold in Rhode Island, and 8.43% in New Jersey. In contrast, the Jeep Grand Cherokee (with a fuel economy rating of 20.2 mpg), accounted for only 5.23% of Chrysler vehicles sold in California but 11.23% of Chrysler vehicles sold in Rhode Island, and 16.26% in New Jersey.

The number and percentage of vehicle models an auto company “delivers for sale” differ from state to state.  For any auto fleet, no two states are likely to have the same average fuel economy or CO2-equivalent grams per mile.

Thus, to comply with the CARB standards, automakers would have to adjust the “mix” of vehicles offered for sale in each state adopting those standards. In each such state, an automaker would have to “deliver for sale” enough vehicles with CO2-equivalent per mile (fuel economy) ratings above the CARB standard to offset vehicles delivered for sale with ratings below. The “mix-shuffling” required for compliance  in State A would likely be different from that required for compliance in State B, C, and so on.

Note that the CARB program would create a vehicle-rationing patchwork even if there were no competing federal fuel economy standards. As the NADA report puts it, “If CARB’s regulation were to take effect in all 50 states, the resulting 50-state patchwork would require automakers to manage 50 unique state fleets and to individually meet CARB’s standard 50 different ways.”

Since the current mix in each state is determined by consumer preference, the adjusted mix would clash with consumer preference. The most likely compliance strategy would involve “rationing larger vehicles, discounting smaller models for quick sale, or other pricing strategies that distort the market,” the NADA report warns. Is that any way to rescue the auto industry?

Adding insult to injury, it’s not even clear that the CARB standards would achieve any significant reduction in emissions. CARB claims that adoption of its standards by 13 states would eliminate 59% more CO2 emissions in 2020 than would compliance with federal fuel economy rules. But companies forced to “deliver for sale” smaller, lighter, more fuel-economical vehicles in the CARB states would be allowed, under the federal fuel economy program, to sell more large, heavy, gas-guzzling vehicles in non-CARB states.

Moreover,  if CARB rules restrict the supply and increase the cost of gas-guzzlers “delivered for sale” in California, for example, Californians would still be free to buy lower-priced gas guzzlers in Nevada and bring them back home. Emissions in California might go down somewhat, but auto sales, jobs, and tax revenues might go down even faster.

California politicians and environmental lobbyists talk about the CARB emissions program as if it were the greatest thing since sliced bread. Lisa Jackson would be well advised to read “Patchwork Proven” before deciding on CARB’s waiver request.

State AGs Give EPA Administrator Lisa Jackson (recycled) bum advice

by Marlo Lewis on February 11, 2009

in Energy, Environment, Global Warming, Legal, Stimulus to Nowhere

In a letter dated 5 February 2009, 17 state attorneys general (AGs) plus three other non-federal officials urge EPA Administrator Lisa Jackson to respond to the Supreme Court case of Massachusetts v. EPA (2007) by issuing a finding that greenhouse gas (GHG) emissions from new motor vehicles cause or contribute to “air pollution” that may reasonably be anticipated to endanger public health and welfare.

To explain why EPA should make an endangerment finding, the AGs quote from EPA’s July 2008 Advanced Notice of Proposed Rulemaking (ANPR): “The IPCC projects with virtual certainty (i.e., a greater than 99% likelihood) declining air quality in cities due to warmer days and nights, and fewer cold days and nights, and/or more frequent hot days and nights over most land areas, including the U.S.” In the ANPR, EPA goes on to say that the increase in air pollution from global warming will lead to “increases in regional ozone pollution, with associated risks for respiratory infection, aggravation of asthma, and potential premature death, especially for people in susceptible groups.”

This chain of reasoning flies in the face of history and public policy reality.

As American Enterprise Institute scholar Joel Schwartz documents, air quality in U.S. cities has improved steadily over the past three decades as urban air temperatures have increased. Nobody should know this better than EPA, because EPA deserves much of the credit and regularly publishes the relevant data. From 1980 to 2006, emissions of the six criteria pollutants fell by the following amounts: lead, 97%; oxides of nitrogen, 33%; volatile organic compounds, 52%; sulfur dioxide, 47%; carbon monoxide, 50%; PM10, 28%; and PM2.5, 31%. As a consequence, ambient concentrations of polluting emissions also declined. From 1980 to 2007, air pollution levels fell by the following amounts: nitrogen dioxide, 43%; sulfur dioxide, 68%; and ground-level ozone, 21%.

More importantly, under existing regulatory requirements, air pollution emissions and concentrations will continue to decline despite potential climate change. Schwartz explains:

EPA’s Clean Air Interstate Rule (CAIR) requires power plant SO2 and NOX emissions to decline more than 70% and 60%, respectively, during the next two decades, when compared with 2003 emissions. This is a cap on total emissions from power plants that remains in place independent of growth in electricity demand. [Note, in July 2008, the D.C. District Court of Appeals overturned CAIR, but whatever EPA puts in its place will likely be even more stringent.]

Recently implemented requirements for new automobiles and diesel trucks, and upcoming standards for new off-road diesel equipment will eliminate more than 80% of their VOC, NOX, and soot emissions during the next few decades, even after accounting for growth in total driving. Dozens of other federal and state requirements will eliminate most remaining emissions from other sources of air pollution.

We may “reasonably anticipate” that in 20 years most U.S. air pollution problems will have been solved, and that by mid-century significant air pollution will exist only in history books.

So the AGs are advising Jackson to act on the basis of bogus “science” that EPA parroted from the IPCC without due diligence.

The AGs are a notoriously unreliable bunch. When litigating Massachusetts v. EPA, they said that the case posed no risks to the U.S. economy because it solely concerned one subset of mobile emission sources (new motor vehicles) under one provision of the Clean Air Act (§202), which requires EPA to consider compliance costs when setting emission standards. The only significant consequence of promulgating first-ever GHG emission standards for new cars and trucks, they said, was that we’d all get better gas mileage and suffer less pain at the pump.

In reality, as EPA’s ANPR and numerous comments thereon reveal, the Clean Air Act is a highly interconnected statute. Setting GHG emission standards for new motor vehicles would initiate a regulatory cascade through multiple provisions of the Act, exposing 1.2 million previously unregulated buildings and facilities to costly and time-consuming regulation under the Act’s Prevention of Significant Deterioration (PSD) pre-construction permitting program, and millions of such sources to pointless paperwork burdens and emission fees under the Title V operating permits program.

Nor is that all. The endangerment finding that would compel EPA to establish GHG emission standards for new motor vehicles would also set a precedent for establishing National Ambient Air Quality Standards (NAAQS) for greenhouse gases. As I explain here, this could lead to the promulgation of NAAQS for carbon dioxide and other GHGs that the United States could not attain even through outright de-industrialization.

In short, if Ms. Jackson acts on the AGs’ advice, she would start a process that could turn the Clean Air Act into a gigantic de-stimulus package.