Issues: Air

May 7, 2001

President George W. Bush
The White House
1600 Pennsylvania Ave., NW
Washington, DC 20500

Dear Mr. President:

Recent news stories report that oil, coal, and electric utility industry lobbyists are urging members of Vice President Cheney's Energy Task Force to interfere with Clean Air Act enforcement actions that the Justice Department, various states, and a number of citizens' groups, including NRDC, are prosecuting in federal court. These enforcement actions are essential to protect public health from excessive and unlawful pollution from these industries. The brazen attempt by a number of the defendants in these cases to enlist White House officials in their effort to avoid prosecution should be rejected promptly and publicly by all members of your administration. We ask that you refer to the Department of Justice -- where such matters belong -- all efforts by industry lobbyists to interfere with these cases.

We also urge you to instruct officials in your administration to reject industry lobbyists' attempts to block enforcement of the Clean Air Act and to reject proposals to weaken the Act's new source requirements for future projects.

The Clean Air Act enforcement actions allege that a number of electric utilities and oil refineries have violated the law by making large investments that have significantly increased their emissions of regulated air pollutants without controlling their pollution as required by the Act. Industry lobbyists sought legislative relief from these enforcement cases in 1999, which Congress appropriately rejected; now they are turning to officials in your White House to help block the government's attempt to enforce the law.

Industry lobbyists make several claims, none of them meritorious. First, they claim their investment projects were "routine maintenance" and therefore exempt from the Act's pollution control requirements. Second, they claim that the legal interpretation of the Act's requirements was newly minted by the Clinton administration. Third, they claim that the interpretation is preventing them from expanding production to meet energy supply needs.

Each of these claims is false. Moreover, the first two claims simply repeat legal arguments the defendants' lawyers are making in court. Judges are the proper officials to assess the merits of these claims, not officials in the White House, operating behind closed doors.

Your administration's Justice Department is already on record refuting the first two industry claims. In its February 21 brief in the enforcement proceeding against the Tennessee Valley Authority (TVA), the Justice Department shows in detail that the projects now claimed as "routine maintenance" were in fact multimillion-dollar capital investment projects designed to substantially extend the life of a number of TVA power plants.

Your Justice Department also has confirmed that the "new interpretation" claim is false. As the TVA brief documents, since its inception in the 1970s, EPA's "routine maintenance" exemption has been defined narrowly by the government, as intended by Congress. See Brief for Respondent United States Environmental Protection Agency, TVA v. EPA, No. 00-12310-E (11th Cir.) (Feb. 21, 2001), at 59, 28 ("EPA's narrow interpretation of the routine activity exception most effectively implements the objectives of the Clean Air Act."; "EPA's interpretation and application of the modification rule and the routine activity exception to TVA's projects are wholly consistent with past agency official positions and practice.")

In 1988, the Reagan administration's EPA administrator formally applied the agency's narrow interpretation of the exemption to deny a claim by a Wisconsin utility that its replacement and modernization projects were "routine maintenance." (Letter from Lee M. Thomas to John W. Boston, Vice President, Wisconsin Electric Power Co. (WEPCO), October 14, 1988.) The industry went to court to overturn this interpretation, but the court upheld the government's reading of the law. WEPCO v. Reilly, 893 F.2d 901 (7th Cir. 1990). As the TVA brief states, the government's interpretation of the "routine maintenance" exemption has been consistent during the period before and after the 1990 WEPCO case.

Industry spokespersons also have claimed that projects to expand energy production at existing plants can be made without increasing pollution but cannot be undertaken because of the Act's new source review (NSR) requirements. That claim is also false. EPA's rules exempt projects accompanied by enforceable commitments to not increase pollution. Moreover, EPA's rules expressly provide that a plant owner can choose a generous baseline pollution level (for electric power plants, the highest pollution year in the past five years; for refineries, the highest pollution year the plant owner shows represents normal operations) and its expansion projects are exempt from NSR if the owner commits to keep the pollution from its expanded operations at the baseline level. Thus, the Clean Air Act and EPA rules do not prevent production increases, they merely require that significant pollution increases be avoided.

Your Justice Department and EPA have reaffirmed this point recently, noting in a successful settlement of NSR enforcement cases against three petroleum refineries that the "settlements will not reduce the capacity of these refineries but will require that their production emit less pollutants." March 21 DOJ and EPA Press Releases, Clean Air Agreements Reached with Petroleum Refiners. Attorney General John Ashcroft called these settlements a "victory for our environment," and noted that "[p]rotecting our natural resources through strong enforcement of environmental law is a top priority for the Department of Justice."

Finally, some have urged the White House to change the Act's NSR rules prospectively, defining "routine maintenance" so that major expansion projects could be built without a permit and pollution controls even if pollution increased significantly. We do not believe that such a change could be made without new legislation. More important, such a change would be indefensible environmental policy and would not help meet our nation's energy needs. As governor of Texas you acted to limit the "grandfather" status of existing pollution sources in Texas. As a candidate for president, you pledged to eliminate the "grandfather" status of large pollution sources as a matter of federal policy. Although you rescinded that pledge for carbon dioxide on March 13, you restated the pledge for other major pollutants.

However, if your administration were to attempt to carve out a new exemption for expansion projects under the guise of "routine maintenance" or some other basis, such an action would allow poorly controlled pollution sources to operate in perpetuity without ever cleaning up or retiring. Such an action would convert these large polluters into "grandfathers on steroids."

Nor is any such change needed to allow expansions for energy producing facilities. As mentioned, a plant owner can build any expansion it wishes so as long the owner commits to not increase pollution above its generous baseline levels.

Your administration should reject industry lobbyists' attempts to block enforcement of the Clean Air Act and any proposal that would weaken the Act's new source requirements for future projects.

Sincerely,

John H. Adams
President

cc: The Honorable John Ashcroft
      The Honorable Christine Todd Whitman

last revised 5.7.01