USA – TEXAS Trends and Developments Contributed by: Gerald J. Pels, Gerald D. Higdon, James Beers, Jr., Elizabeth Corey and Brett A. Miller, Troutman Pepper Locke
significant ramifications for the ability to regulate GHGs in the USA. Putting America first in international agreements: EO141462 This EO withdraws the USA from the Paris Cli- mate Agreement and revokes any financial com- mitment by the USA pursuant to the UN Frame- work Convention on Climate Change. These efforts are consistent with those taken in the first Trump administration. While the EO is stark, its simplicity makes clear that climate change con- siderations will be secondary to developing US fossil fuel energy markets. Unleashing American energy: EO141541 (Provisions Addressing Financial Impacts of Carbon Emissions) This Order (discussed previously) revokes many Biden administration EOs that were designed to mitigate climate change, including the termina- tion of all programmes and agreements of the American Climate Corps. Notably, the Order also directs the EPA to no longer consider the Social Cost of Carbon (SCC) in permitting and regu- latory actions or decisions. This is significant because the SCC was a foundation for justify- ing the increased cost of regulation on the fossil fuel industry by offsetting the impacts of that cost burden with the regulation-based financial benefit of GHG emissions reduction. To fully understand the magnitude of the issue, as of 2023, the EPA estimated the dollar value of the SCC at USD190/CO₂ ton, with proposed increases to USD308/ton by 2050. EPA Admin- istrator Zeldin has stated that attributing this dol- lar value to emissions has “logical deficiencies”, “a poor basis in empirical science” and lacks “a foundation in legislation”. In the absence of attribution of these costs, it will be increasingly
difficult for additional climate change regulations to get material traction. Other actions taken by the administration affect- ing efforts to regulate climate change include a 20 January 2025 EO temporarily halting wind energy leasing within the Offshore Continental Shelf. The EO also directed federal agencies to not issue or renew approvals, rights-of-way, per- mits, leases or loans for onshore wind projects pending a “review of federal wind leasing and permitting practices”. The review is directed to encompass environmental factors, such as wild- life impacts, as well as the impact of intermittent energy generation on the viability of the wind industry in the absence of subsidies. Proposed Regulatory Reform The administration is implementing policy that attempts to shape environmental regulation for the foreseeable future through specific and detailed EOs and EPA proposals. For exam- ple, EO 14192 (Unleashing Prosperity Through Deregulation) mandates cost-based deregula- tion through two specific requirements. First, it requires that each new regulation proposed or promulgated must be offset by the repeal of ten regulations. Second, new incremental costs imposed by rule must be offset by incremental cost reductions associated with the repeal of ten prior regulations. In addition, pursuant to EO 14270, the adminis- tration is calling for zero-based regulatory budg- eting regarding rules affecting energy develop- ment. Specifically, agencies including the EPA are directed to include sunset provisions in new regulations governing energy production and to integrate sunset provisions where permitted by law into existing regulations, thereby requiring periodic re-examination of a rule’s public ben- efit. The Order directs the EPA to develop a list
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