An environmental trap set during the administration of former US President Bill Clinton has been sprung by the politics of midterm elections. Refiners are caught in the snare.
Especially in its second term, the Clinton administration implemented and enforced environmental regulations with escalating zeal. Now, as the administration of George W. Bush tries to restore reason, supporters of the old team complain that environmental progress is being thrown into reverse. With the approach of this week's voting, the complaining has become shrill.
Changes suggested
The core issue is the New Source Review (NSR) program established by the Clean Air Act. The program requires permits for new stationary sources of air pollution and for changes to existing facilities likely to aggravate pollution. Last June, after 10 years of study, the Environmental Protection Agency suggested a number of changes.
Among problems addressed by EPA's recommendations are uncertainties over the plant modifications and emission thresholds that trigger NSR permitting requirements. Clarification is in order. Many refiners have upgraded their facilities in recent years assuming, with the consent of regulators, that they didn't need NSR permits. During the Clinton administration, EPA decided that many of those projects did require permits and enforced the interpretation retroactively. The current EPA saw ambiguity allowing for this kind of costly second-guessing as good reason to finish the longstanding NSR review and to make repairs.
This, in the view of the current administration's political opponents, amounts to grievous environmental retreat.
Late last month Jim Jeffords (I-Vt.), chairman of the Senate Environment and Public Works Committee, and Joe Lieberman (D-Conn.), chairman of the Senate's Clean Air Subcommittee, proclaimed "outrage" that the administration hadn't responded to their request for an explanation of the "scientific basis" of the EPA proposals. If the administration had responded, of course, they would have declared outrage over insufficiency of the data, no matter how thorough it might have been, or over interpretation of the data, or over something.
Just before the election recess, Jeffords accused the Bush team of weakening the Clean Air Act. Lieberman called the EPA proposals "the largest rollback in history" of the legislation. The lawmakers promised to issue a subpoena for the documents they seek from EPA and the Department of Energy in November.
At the same time, a group called the Environmental Integrity Project of the Rockefeller Family Fund issued an analysis reaching the not surprising conclusion that relaxation of the NSR's emission thresholds would raise emissions of target substances at specific plants. That, indeed, sounds like environmental regression.
But NSR isn't the whole story on efforts to clean the air. It's far from the only stationary-source regulation with which refineries and other plants must comply. And most refinery upgrades these days relate to production of clean fuels. To the extent aggressive NSR enforcement discourages plant changes, it impedes refiners' abilities to meet other air-quality goals.
That's the other jaw of the trap. It was the Clinton administration's EPA that decided to make refiners cut the sulfur content of highway diesel fuel by 97% instead of a statutorily permissible and industry-supported 90%. The deeper cut compels plant changes that the lesser cut does not without meaningfully improving environmental performance of diesel fuels and engines. So on one side, maximum regulation of diesel sulfur requires extra investment and facility changes without delivering extra environmental benefit. On the other side, aggressive and retrospective NSR enforcement adds to the costs and time required for facility changes. And anyone calling that a senseless dilemma gets accused of environmental apostasy.
Discourages projects
In its June report to Bush, EPA said that the NSR program "as applied to existing plants discourages projects that would have provided needed capacity or efficiency improvements and would not have increased air pollution—in fact in some cases air pollution may have decreased." With refineries needing to make plant changes necessitated by overlapping clean-fuels programs—and to make them soon—discouraging projects with a flawed permitting program is environmentally unsound.
Environmental policy must amount to more than serial punishment of essential if unfashionable industries such as refining. But that's how the Clinton EPA regulated. The Bush EPA deserves credit for trying, despite braying from the opposition political party, to set things right.
