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April 2023 Exclusive Story

API Calls on Biden to Rescind CEQ’s Greenhouse Gas Guidance

WASHINGTON—In a letter to the White House Council on Environmental Quality, the American Petroleum Institute calls on the Biden Administration to rescind CEQ’s Interim Guidance on Consideration of Greenhouse Gas Emissions and Climate Change. The organization explains that the guidance’s approach to National Environmental Policy Act compliance would undermine efforts to develop critical energy projects, including renewables.

“API shares the Biden administration’s goal of reducing GHG emissions across the economy and specifically from the production, transportation and use of energy resources,” writes API Director of Climate and ESG Policy Jennifer Stewart. “We also share the administration’s goal of permitting reform to reduce Americans’ energy bills, promote energy security for the United States and our allies, and boost our ability to build energy projects. However, we do not believe the interim guidance helps agencies advance these goals in a lawful or effective manner.”

In its comments, API outlines numerous concerns with CEQ’s guidance, including the duplication and disregard of other agencies’ NEPA reviews and GHG regulations, which could delay agency processing time significantly and compromise the U.S. energy supply and the deployment of lower carbon solutions.

“Absent reasonable improvements to agencies’ NEPA permitting processes, this administration’s efforts to invest trillions of dollars in infrastructure improvements and environmentally beneficial projects may be suppressed or significantly delayed,” Stewart assesses. “As currently drafted, the interim guidance will perpetuate and exacerbate the undue delay, complexity and inconsistency that have been the unfortunate hallmarks of NEPA reviews for decades, highlighting the need for comprehensive permitting reform.”

Citing CEQ’s statistics, she points out that the average length for a final NEPA environmental impact statement has reached 661 pages, with an average of 1,042 pages of appendices. “Strikingly, the average EIS length has continually increased since NEPA’s enactment, despite CEQ’s issuance of a directive over 40 years ago stating that normal EISs should be no longer than 150 pages, and at most 300 pages for proposals of ‘unusual scope or complexity,’” Stewart reports.

This length reflects a review process that API describes as “unnecessarily complex, unreasonably time-consuming and uncertain.” Under the current NEPA process, completing the average EIS takes four and a half years, with 25% taking more than six years, API calculates.

The arduous process “impedes investment in critical infrastructure, including projects immediately needed to facilitate the growth of a changing energy market as well as countless investments essential to improving the resiliency, health and economic wellbeing of underserved communities,” Stewart argues.

Boundless Scope

According to API’s letter, EIS complexity is “often attributed to the inclusion of highly attenuated and speculative alternatives and effects, the analysis of which does not further meaningful project review.” API says the interim guidance will continue this trend by requiring agencies to “assume that a proposed project will result in climate change impacts to the human environment whenever there are any presumed direct and indirect GHG emissions associated with the project.”

The letter clarifies that CEQ is “urging agencies to attempt to assess the potential global climate change impacts that may result from the incremental contribution of a single project or agency decision ‘when added to the effects of other past, present and reasonably foreseeable actions regardless of what agency (federal or nonfederal) or person undertakes such other actions.’ While API recognizes that CEQ’s regulations have for many years required agencies to consider the cumulative effects of their actions, the cumulative effects that the interim guidance urges agencies to estimate are so boundless and indeterminable that it is not realistic to presume that any agency could develop a reasonably reliable assessment.”

According to API, “an analysis that purports to discern a single project’s incremental impact on global climate change in relation to all the GHGs that were ever emitted or will be emitted can never be credibly reliable, and therefore advising agencies to develop these analyses will not help agencies make better decisions.”

In fact, API argues, the analyses can undermine effective decision-making by burdening agencies with unnecessary work. “When each agency is encouraged or required to similarly consider all possible upstream and downstream impacts irrespective of how limited the agency’s jurisdiction may be or how attenuated and speculative the indirect effects are, wasteful duplication and inconsistency is all but a certainty,” Stewart warns.

“The result of this inevitable duplication and inconsistency is not just the squandering of agency resources on needless paperwork or the perpetuation of inordinate delay,” she continues. “Requiring each agency to speculate as to tangentially related impacts outside of their statutory jurisdiction frustrates rather than furthers well-informed decision-making. Requiring agencies to analyze any and all indirect impacts will distract agencies from fully or effectively assessing the direct impacts of their proposed actions.”

Singling Out Oil

The requirement to develop GHG emission estimates is applied unevenly, Stewart observes. “To attribute greater ‘significance’ to a proposed fossil fuel-related project’s GHG emissions for purposes of NEPA reviews than would otherwise be supported by climate science or NEPA case law, the interim guidance urges agencies to skew their analyses by assigning speculative indirect and cumulative impacts to only these types of projects,” she writes. “In contrast . . . agencies may presume that ‘certain renewable energy projects’ have relatively ‘minor and short-term GHG emissions,’ the climate change effects of which need not be fully considered.”

The guidance exaggerates hydrocarbon projects’ impacts by instructing agencies to assume all hydrocarbons produced will be combusted as fuel, API reports. “While oil and natural gas produced from federal leases may ultimately be combusted, these hydrocarbons are also used as feedstock for a number of products, such as fertilizers, fabrics, medicines, plastics, chemicals and a wide variety of consumer products,” the letter notes. “Thus, a ‘full burn’ assumption ‘that all of the available resources will be produced and combusted to create energy’ is an unduly speculative and improper ‘worst case’ scenario.”

The unrealistic estimates of hydrocarbons’ impacts suggest that CEQ is trying “to commandeer Congress’s singular authority to shape and direct our nation’s energy policy,” API charges. “Congress has long exercised this authority through statutes like the Federal Land Policy and Management Act, Natural Gas Act, Mineral Leasing Act and Outer Continental Shelf Lands Act; and more recently through the Infrastructure Investment and Jobs Act and the Inflation Reduction Act.”

Although these statutes give agencies some discretion, they still need to follow the broad policies established by Congress, API says. Rather than living up to that standard, the interim guidance “attempts to upend the comprehensive and cohesive energy policymaking role entrusted to Congress by devolving national energy policy decisions to the scores of discrete actions that will be undertaken by dozens of agencies with widely varied expertise and authority.”

Ultimately, “the interim guidance reveals the futility of attempting to establish broad national energy policies through unenduring agency guidance that changes from presidential administration to administration, undermining the certainty that project developers need to make significant capital investments in energy projects,” Stewart argues. “API will continue to work across industry sectors and political parties to achieve meaningful and enduring permitting reform in Congress.”

The letter is available at API Calls on Biden Administration to Rescind NEPA Guidance.

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