CLIMATE:

Former EPA official details White House retreat on GHG regs

President Bush scrapped U.S. EPA's well-developed plans to regulate greenhouse gas emissions from motor vehicles, power plants, petroleum refiners and other major polluters at the urging of White House insiders who argued such a move would tarnish the president's legacy, a top former EPA official told congressional investigators this week.

Jason Burnett, a former adviser to EPA Administrator Stephen Johnson, detailed the Bush administration's behind-the-scenes efforts to respond to the Supreme Court's April 2007 decision in Massachusetts v. EPA, for Rep. Ed Markey's (D-Mass.) Select Committee on Energy Independence and Global Warming.

The court ordered the federal government to consider greenhouse gas emissions as pollutants subject to regulation under the Clean Air Act, but several administration officials fought EPA tooth-and-nail, Markey concludes in a report that combines Burnett's testimony with internal documents obtained under subpoena.

Although the administration took several significant steps toward regulating greenhouse gas emissions, Bush ultimately backed down after hearing counter-arguments from the office of Vice President Dick Cheney, the Office of Management and Budget, the Transportation Department, Exxon Mobil Corp. and others in the oil industry, the report finds.

Last November, the office of the White House chief of staff signed off on EPA's all-important "endangerment finding" that determined whether greenhouse gases were a threat to public health and welfare. By approving EPA's endangerment finding, Joel Kaplun, Bush's deputy chief of staff for policy, also gave the agency the green light to propose greenhouse gas rules in spring 2008 and finalize them in the fall.

"Either this administration would need to move forward with responding to the challenge or the next one would need to move forward with responding to the challenge," Burnett said.

"And it was the general belief of the political leadership of this administration that if they moved forward with the challenge, that they could put in place a sensible framework," he added. "And the general feeling was that it made sense to establish that mark and set that precedent for such an important decision."

Burnett, who served until last month as the EPA associate deputy administrator, is scheduled to testify before the Senate Environment and Public Works Committee on Tuesday. The Stanford-trained economist also handled also air pollution issues at EPA from 2004 to 2006, playing a major role in the mercury standards overturned earlier this year by a federal appeals court.

Approval from up high

According to Burnett, Johnson decided by the fall 2007 that the best way to regulate for greenhouse gases from stationary sources such as power plants and refiners came through Section 111 of the Clean Air Act, a section of the landmark 45-year-old law that deals with efficiency upgrades at big industrial plants.

The Clean Air Act section would need some important regulatory or legislative fixes, but Johnson and other EPA officials considered it the best equipped area to deal with the potentially overwhelming issue of climate change.

EPA officials picked the provision over two other potential Clean Air Act sections that deal with toxic air pollution and federal limits on air emissions, also known as the National Ambient Air Quality Standards, Burnett said. EPA also planned to pursue climate rules for fuels and vehicles, following through with a regulatory effort that started with Bush's 2007 State of the Union speech and the call to reduce U.S. gasoline consumption 20 percent within a decade.

Johnson's climate decision initially had support from a number of key Bush insiders, including the White House's Kaplan, as well as Energy Secretary Samuel Bodman, Treasury Secretary Henry Paulson, Council on Economic Advisors Chairman Edward Lazear and Council on Environmental Quality Chairman Jim Connaughton.

"Most of the Cabinet-level officials that Administrator Johnson talked to recognized the importance of considering costs and benefits and technology and energy in developing greenhouse gas regulations," Burnett said. "And therefore, most everyone gravitated toward Section 111, the section that allows consideration of all of those factors."

The Dec. 5 phone call

But not everyone in the Bush administration felt the same way.

The office of Vice President Cheney, the Office of Management and Budget and Connaughton's CEQ were still pushing in the other direction, Burnett said. They wanted to either avoid responding to the Supreme Court's decision, push Congress into making a legislative fix "or some other way of moving forward with a response" that was limited to motor vehicles.

Those arguments ultimately won out as Congress moved toward passage of a wide-ranging energy bill that for the first time in decades increased fuel economy standards for cars and light trucks.

According to Burnett, Kaplan called Johnson back Dec. 5 and told him to cancel the endangerment finding. Concerned that the wheels already started turning on the EPA ruling, Kaplan urged the agency's top environmental official to say that he had mistakenly sent the document over to the White House. Johnson initially refused, but the endangerment finding hasn't moved an inch since.

Over the next three months, White House officials started making the case that the administration's climate policies should be studied anew in light of the new energy law's adoption (E&ENews PM, Jan. 4).

Then in late February, Burnett said Bush officials convinced Johnson to announce plans for a much broader regulatory announcement responding to the Supreme Court's decision that would include a public comment period on many different ideas related to greenhouse gas emissions.

EPA issued the Advanced Notice of Proposed Rulemaking last week, in effect punting on any critical moves to the next administration (E&ENews PM, July 11).

"This decision was made at the highest level within the administration," Burnett said. "The concern was that while moving forward with the response would enable a more sensible response to the Supreme Court than if the administration left it to the courts or the next administration, the concern was over the president's legacy and not wanting to have an increase in regulation, particularly regulation under the Clean Air Act, to be attributed to this administration and to President Bush's legacy."

Asked to name the Bush officials who pressed against new EPA regulations, Burnett said the most vocal arguments came from Transportation Department officials who did not want to cede turf to the EPA on fuel economy. He also confirmed that Vice President Cheney's energy adviser, F. Chase Hutto, OMB general counsel Jeffrey Rosen and officials even higher up in the administration played a big role in the new policy position.

"Over time and after passage of the energy bill, the opposition to move forward came from higher up," Burnett said. "But during the interagency decisionmaking process, they were certainly central to the arguments for either not moving forward, keeping an option to not move forward or in many cases, unrealistically limiting the ramifications of the Supreme Court case to just cars and trucks, or at least mobile sources."

Burnett said he also heard from Exxon Mobil, the American Petroleum Institute and the National Petrochemical and Refiners Association against moving forward with the climate rules because it would tarnish Bush's legacy.

The oil companies' positions stood in contrast to the Edison Electric Institute, which Burnett said was a "prominent example of a group that recognized that this was coming, and that they at least said that they thought that their members would be better served by getting out in front and actively engaging rather than trying to fight what they judged to be inevitable."

More questions

The White House did not respond to requests for comment on Markey's investigation and Burnett's account of the climate policy decision.

But in the EPA proposal issued last week, Connaughton included a letter that clearly takes issue with what he calls a staff-driven effort to overregulate. "The novel, case-by-case application of old regulations to an entirely new set of circumstances and parties foreshadows unrelenting confusion, conflicts over compliance, and decades long litigation windfall for attorneys, consultants, and activists as communities and the courts strive to sort it all out," Connaughton wrote.

Markey's panel has been conducting an investigation into the Bush administration's decisions on climate change for more than a year. The committee voted unanimously in April to subpoena White House documents despite complaints from the administration that their release would have a chilling effect on the deliberative process.

More questions are likely to be asked concerning the role the White House played in the EPA rulemaking.

In addition to Burnett's appearance, Johnson has been asked to testify July 30 before the Senate Judiciary Committee.

In his interview with Markey, Burnett said he left EPA in 2006 because he was disappointed with the Bush administration's decision to set federal limits on microscopic soot at levels below those recommended by an EPA-appointed panel of scientists. He later rejoined EPA at Johnson's request to work on the climate rules.

Burnett is a Democrat and has contributed to Sen. Barack Obama's presidential campaign. He also is the grandson of high-tech entrepreneur David Packard and a member of the Packard Foundation's board of trustees.

Click here for the Burnett transcript.

Click here for the Markey report.

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