Using Deregulation to End the War on Coal and Oil

Katelyn Scott
Associate Editor
Loyola University Chicago School of Law, JD 2019

 

Environmental regulation has been heavily targeted by President Trump since the first days of his presidency, and even throughout his campaign. He announced early on that he wanted to cut general business regulations by at least 75%. His justification was that he wanted to remove red tape and delays and promote industry growth and economic development. The two industries potentially most affected by changes to environmental regulations are the oil industry and the coal mining industry.

One of this administration’s first big moves towards environmental deregulation was withdrawing from the Paris Accord. Against the advice of many leaders in the tech and fossil fuel industry, Trump chose to withdraw, stating that the terms of the accord were not as favorable to the United States. Experts say the support of the Paris Accord stems from a general trend towards reducing emission and creating more sustainable sources as a better investment than coal and oil, and a more “global framework”. Although some  experts and leaders in the fossil fuel industry have been denouncing the changes, others are consulting with the Environmental Protection Agency (EPA) and the Interior Department on policy changes and leading the teams created to evaluate and remove regulations.

Deregulation within the oil industry

Recently, the EPA and other agencies have begun to reconsider standards on emissions and waste.  In March, Trump issued an executive order to have the Bureau of Land Management (BLM) review the methane waste rule, which led the Department of Interior to issue Secretarial Order 3349. Order 3349 postponed compliance with the methane waste rule, until a full review could be conducted. remove the company obligation to report details about their emissions, prevent methane leaks, and allows for companies to burn unwanted methane. Long delays in promulgating new standards have caused two states and seventeen environmental groups to file suit challenging the BLM.

Smaller towns that rely on gas and oil production, such as Riverton, Wyo., are pleased to see some changes in regulations because it allows for them to ramp up production that has been slowing over time. For people in these small towns, oil and gas regulations kill their business and end up costing too much money to comply. The deregulation gives them a chance to up production, and not invest in the cost of complying with higher standards in the regulations.

On the other hand, Big Oil companies favor regulations on oil. These companies argue that the regulations are not the cause of the demise of the businesses, but that the struggling industry is a result of a lower demand for cheaper gas. Further, there are concerns among leaders that complete deregulation is just as bad as over-compensation.

Although the stated purpose of deregulation is to remove restrictions that cause delays within the oil industry, larger issues are still be at bay. Larger oil companies fear that rapid deregulation will lead to another disastrous spill or explosion like Deepwater Horizon, making industry interests an easy source of blame for such accidents. However, this opposition seems popular amongst only the largest multinational companies, who have already spent large amounts in order to comply with the regulations put in place during the Obama administration. Smaller companies have not yet fully rolled out compliance programs and, therefore, are not as invested in maintaining or increasing regulation.

Deregulation within the coal industry

The coal industry is seeing an aggressive push toward more access to public lands and fewer restrictions on clean up and waste. The EPA is currently reconsidering its regulations regarding the treatment of hazardous waste, and delaying a decision on the treatment of coal plant This is of concern to many environmental advocates and citizens in areas near mines because it allows the pollution of water supplies for many communities and ranchers, and has been linked to different illnesses.

Deregulation in the coal industry was intended to create more jobs and allow miners to go back to work. However, there is debate as to whether the regulations were harmful or whether they were actually providing jobs. On one side, the argument is that the regulations sacrifice jobs for environmental purity, others argue that the environmental regulations created jobs for people to ensure compliance. These jobs included many science positions to track water flow and environmental impact.

Overall, the full impact of deregulation is yet to be seen but it is possible that there will be a drop in compliance jobs as regulation is scaled back. Further, companies that choose to continue to comply with regulations are at a disadvantage internationally where the regulations never applied, and against the companies that have already invested into compliance. Companies also can be at a disadvantage if they choose to continue to follow higher standards against those within the United States that could opt to follow the lower, unregulated standards. However, is also still a question as to the impact deregulation will have on the environment the regulations were put in place to protect.

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