The US has new occasion to choose between genuine environmental protection and environmentalist punishment of disfavored industries. And the oil and gas industry has a fresh chance to show how those motives clash.
The administration of President George W. Bush has begun a review of several of its predecessor's environmental excesses. Prominent among the issues under study is the Environmental Protection Agency's 1998 reinterpretation and retroactive enforcement of the new source review (NSR) program of the Clean Air Act. EPA's new approach to NSR is a plague on refiners. Formerly exempt projects suddenly require permits. Retroactive enforcement of the requirement penalizes refiners who acted in good faith when they upgraded facilities. And confusion over the apparent broadening of the requirement discourages future investment.
Perverse behavior
In the context of environmental quality, EPA's behavior is perverse. Many of the refinery projects newly in need of NSR or related permits are essential to the achievement of Clean Air Act goals. EPA's aggression with the NSR program thus works against production of modern vehicle fuels central to US air-quality progress.
That progress is impressive. Since 1970, combined emissions of the six air pollutants subject to federal regulation have fallen by 29%, according to EPA. The improvement occurred even as the economy, population, and vehicle fleet grew and as driving and total energy demand increased.
EPA's stern approach to NSR permitting limits the ability of refiners to produce modern fuels in exchange for minimal air-quality improvement. Last June, EPA said it had reached NSR-related settlements with four companies agreeing to spend an estimated $1.2 billion for emission-control remedies. The agency said the actions would reduce emissions of nitrogen oxides by 43,200 tons/year and of sulfur dioxide by 88,250 tons/year.
That sounds like a lot of pollution. Yet, in 2000, US emissions of NOx totaled 25 million tons and of SO2, 11.2 million tons. Against those totals, air-quality gains from costly, retrospective industry regulation are minor. EPA's NSR report doesn't provide that context. And those already small emission cuts are offset to the extent they delay or prevent investment in equipment that improves the environmental performance of refinery products.
A government serious about environmental quality would not just review the new NSR regime but scrap it and demand better perspective from EPA. With an election year approaching, however, that's easier said than done.
The political squawking has begun. Attorneys-general from nine states in the Northeast, worried mainly about emissions from coal-fired power-generating plants, threatened to sue the administration to block the NSR review. The Senate Environment and Public Works and Judiciary committees last week announced joint hearings about the plan. In December, the Sierra Club warned of "the latest assault on the Clean Air Act." Likely changes, the club said, "will provide electric utilities, refineries, and other polluters with a host of new loopholes to avoid installation of modern pollution controls when they modify their plants and increase pollution."
Sample bluster comes from Sen. James M. Jeffords, independent chairman of the environment committee whose departure from the Republican Party last year gave control of the Senate to Democrats. "Polluters are supposed to reduce their total emissions as time goes by, not increase them," said Jeffords, quoted in the New York Times. "The administration should consider itself put on notice that it will be held accountable." Soon, Jeffords or someone like him will be talking about "turning back the clock on environmental progress."
Implicit in all this is the assertion that success of the Clean Air Act depends on EPA activism with the NSR program. What nonsense. As it affects refiners, the NSR crackdown actually impedes air-quality progress. It discourages investment in projects that sustain the supply of fuels able to meet ever-tightening environmental standards. In the fight against air pollution, that's retreat.
Governing logic
In modern environmental politics, however, the crackdown represents victory. It punishes refiners, after all. And anything that punishes "polluters" must be good for the environment. Besides, it's easier to mete out punishment than it is to balance complex environmental values.
The governing logic of environmental politics has to change. What fails environmentally now too readily succeeds politically. The environment deserves better treatment.
