Catalyst

RegWatch: Trump Administration Regulatory Reforms Pave the Way for Stronger Economy

This past June, the U.S. Environmental Protection Agency invited the PA Chamber to take part in the formal rule signing for the Affordable Clean Energy rule, the replacement regulation for the Obama Administration’s Clean Power Plan. The event took place at the EPA’s Headquarters in Washington D.C., and I was honored to represent the members of the PA Chamber at the event.

 

Other speakers included President Trump’s Chief of Staff Mick Mulvaney, EPA Administrator Andrew Wheeler, White House Council on Environmental Quality Mary Quigley, various business and labor officials, and several Congressmen, including Republican Pennsylvania Cong. G.T. Thompson.

 

 

As noted in remarks at the event, the PA Chamber had been the lead-named party in a 166-party amicus brief, joined by dozens of other business and manufacturing groups, which urged the United States Supreme Court to reject the Obama Administration’s CPP rule. The plan sought to regulate the electric grids of each state as the source of emissions, rather than taking the facility-level approach that had historically been how the Clean Air Act was applied. The Clean Power Plan also gave no credit for extending the licenses of nuclear facilities, and would have suppressed demand for natural gas production and use. The Supreme Court did ultimately suspend the rule in 2016, and the Trump Administration quickly set to work proposing and finalizing a replacement regulation that focuses on what is achievable at individual facilities.

 

The PA Chamber also noted in its statement about the rule that Pennsylvania’s experience shows a commitment to innovation and free markets will deliver improved air quality and greenhouse gas reductions.  By embracing this method, Pennsylvania has reduced proportionally more carbon dioxide than states participating in the Regional Greenhouse Gas Initiative, a cap-and-trade program imposed on the power generation sector of New England and Mid-Atlantic states.

 

Further regulatory reforms are expected from the Trump EPA, designed with the intent to hew more closely to authorizing statutes and providing more predictability and flexibility to businesses. These reforms include modifications to the New Source Review regulations, which at present can discourage investment into existing facilities by virtue of imposing significant regulatory costs should a company expand its output, as well as formal repeal of the two-decades old “once-in, always-in” guidance on hazardous air pollutant rules for major sources. The “once-in, always-in” interpretation was established under the Clinton Administration, and essentially requires manufacturers and industrial facilities to always install and operate controls for HAPs even if the facility changes its operational profile such that it is no longer producing such emissions. Several PA Chamber members have reported that this interpretation of the Clean Air Act required eight to nine-figure outlays for regulatory compliance during facility expansion projects, even though they had long stopped producing these emissions.

 

Finally, the Trump EPA is also expected to revise a rule for emissions of nitrogen oxides from the trucking sector. It is expected that the proposed rule will be a significant decrease in the amount of allowable emissions of NOx, which is a precursor to ozone. Over the last several decades, much of the regulatory focus has been on stationary sources, such as manufacturing and power plants. While air quality has significantly improved due to regulatory and market pressures, there remain some parts of the country where there are persistent ozone air quality issues. Not coincidentally, these areas are near major metropolitan regions with heavy interstate traffic. Reasonable and good faith analyses are showing that the same amount of regulatory cost imposed on the trucking sector will yield more reductions in emissions than imposing that cost on stationary sources. Should the Trump EPA implement a rule that yields significant reductions in NOx from the trucking sector, it is likely that there will be improved air quality as a result; as well as reducing the burden on existing manufacturing and industrial sources to be responsible for more than their fair share of emissions reductions. This rule is expected to be proposed by the end of 2019.

 

The PA Chamber expects to comment on all of these rules as they are proposed, and looks forward to engaging with its membership to shape those comments. As always, please contact our Government Affairs team for more information or to get involved.

 
Kevin Sunday is director of government affairs for the PA Chamber.

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Founded in 1916, the Pennsylvania Chamber of Business and Industry is the state's largest broad-based business association, with its membership comprising businesses of all sizes and across all industry sectors. The PA Chamber is The Statewide Voice of BusinessTM.