Industry groups are skittish the government shutdown, now in its fourth week, could imperil President Trump’s deregulatory agenda, particularly for energy policy.
“We are very concerned about the regulatory progress being stifled by the shutdown,” Christopher Guith, senior vice president of the Global Energy Institute at the U.S. Chamber of Commerce, told the Washington Examiner.
The Chamber’s energy institute published a blog post Thursday listing 20 energy-related reforms at the Interior Department and Environmental Protection Agency that could be delayed because of the shutdown. Both agencies are closed for business.
“While a couple of weeks may not seem like a big deal, as the shutdown drags on, it is not an exaggeration to say that it may soon have a material impact on the ultimate success or failure of these efforts,” Dan Byers, senior director for policy at the Chamber’s energy institute, wrote in the blog post.
A particular worry, Byers said, is the possibility that prolonged delays could leave rules vulnerable to being repealed by Congress in future administrations using the Congressional Review Act, which gives lawmakers 60 days after a rule takes effect to pass a resolution disapproving it.
Republicans in Congress used the tool aggressively in 2017, repealing 14 Obama administration rules, including two energy-related ones, the Chamber noted.
Industry groups and allies were already concerned before the shutdown that, because of court challenges, the Trump administration could fail to implement many environmental rules changes meant to promote energy development before the president’s first term ended.
Critics and even some allies say the Trump administration hurt its own cause, especially early in the president’s term when agencies where short-staffed, by not always following proper legal procedures and laws to unwind regulations.
“The shutdown is certainly slowing down the regulatory reforms that EPA has been working on,” said Jeff Holmstead, a former deputy administrator of the EPA in the George W. Bush administration who represents energy clients at the law firm Bracewell.
“They still have plenty of time to finish up their major reforms, but if the president doesn’t win a second term, they may not be around to defend their reforms in court,” Holmstead told the Washington Examiner.
Critics of the Trump administration’s deregulatory approach, however, are downplaying the impact of shutdown-related delays.
“It’s a delay, but I don’t think any one of us are thinking this significantly changes the trajectory or will prevent them from moving forward with their agenda because they have made clear what their goals are,” said Elizabeth Klein, deputy director of the State Energy and Environmental Impact Center.
The Chamber highlighted a couple of EPA rulemaking processes impacted by the shutdown.
EPA was unable to publish in the Federal Register its proposal, introduced last month, to shrink the Obama administration’s Waters of the United States rule, commonly referred to as WOTUS. Agencies are not permitted to use the Federal Register during shutdowns. Public comment periods cannot begin until rules are formally published. A public hearing on the rule originally scheduled for Jan. 23 has already been postponed.
Similarly, the shutdown has prevented EPA from publishing a proposal announced in December to change the way the federal government calculates the benefits and costs of forcing coal plants to restrict emissions of mercury, a hazardous pollutant.
EPA was able to place in the Federal Register another major rule issued in December that would encourage new coal plant development by allowing plants to be built without carbon capture and storage emission-control technologies. But the agency was forced to postpone public hearings on the proposal scheduled for this month. The EPA did not respond to requests for comment.
The Chamber and other industry groups are particularly concerned about delays at the Interior Department, which oversees energy development on federal land and waters.
Industry groups had expected Interior to release this month its lightly anticipated final plan to expand offshore oil and gas drilling. The agency released its draft proposal in March to permit oil and gas drilling in nearly all federal waters, and industry officials are eager to see whether Interior shrinks the plan after bipartisan complaints from coastal governors worried about the possibility that it could increase spills or hurt tourism.
Joe Balash, Interior assistant secretary for land and minerals management, told the Washington Examiner the agency won’t release the final offshore drilling rule until February at the earliest. He cited being challenged by a lack of access to the Federal Register. But he also attributed the delay to trying to strike “the right balance” between appeasing industry’s interest in more offshore drilling opportunities, particularly in the eastern Gulf of Mexico and off the coast of Alaska, and addressing the concerns of politicians and residents.
“We created an awful lot of work for ourselves when we put 97 percent [of federal waters] on the table [for drilling],” Balash said in an interview. “Working through all of that has taken a little longer than we initially estimated it would. Finding the right balance is a little bit tricky.”
Still, dozens of Interior employees continue to work on the offshore drilling plan during the shutdown, and others are available on an on-call basis, according to a contingency plan posted online by the agency’s Bureau of Ocean Energy Management.
The offshore wind industry is worried about shutdown-related delays too. Three public hearings have been postponed for a planned project to build an offshore wind farm off Martha’s Vineyard in Massachusetts.
The Trump administration has cited the Vineyard Wind project, which could power more than 400,000 homes, and others planned for the Northeast as key evidence that it is not neglecting renewables as part of its “energy dominance” agenda.
But some major work at Interior has continued unimpeded, pleasing industry groups and angering environmentalists who say the administration is improperly emphasizing energy development over other basic agency functions.
Interior is continuing to process permit applications for oil and gas drilling on federal land, and in existing offshore areas where energy development is allowed in the Gulf of Mexico, using carryover funds and user fees.
It is also proceeding with oil development in Alaska’s Arctic National Wildlife Refuge, known as ANWR. Interior last week postponed public meetings to discuss an environmental impact analysis recently released by the agency. But it kept in place a Feb. 11 deadline for public comments despite uncertainty over when the shutdown will end.
“We are focused on finding ways to prioritize those things critical to the president’s agenda and the business of the American people,” Balash said.
Environmental groups and Democrats seized on that decision as showing how the Trump administration is rushing the leasing process faster than the timeline Congress outlined when it voted in 2017 to allow drilling in the refuge.
Under the environmental analysis released last month, drilling rights could be sold as soon as this year in a small portion of the long-contested refuge, which is inhabited by animals such as polar bears, caribou, and arctic foxes.
“Reasonable people can disagree on whether ANWR should have that type of activity, but if Interior won’t take time to engage all stakeholders, you are just asking for a fight,” Klein said.
Balash said Interior may extend the comment deadline if the shutdown persists. But he said the agency’s continued work, and its fast review process, demonstrates the Trump administration’s commitment to a pro-industry agenda.
“While in the bigger picture, the Chamber is right to be concerned about delays, I am happy to sit down and talk with them on why they shouldn’t be,” Balash said. “If we were operating on a business-as-usual sort of schedule where an EIS [environmental impact analysis] takes three years, they should be worried. But that is not the way this administration has been functioning.”
