04/25/2019 - Regulatory Rollback

Executive Order 13868 on Promoting Energy Infrastructure and Energy Growth

by Hana Vizcarra

Why It Matters

President Trump has made “energy dominance” and increased development of fossil fuel resources a key theme of his presidency. He issued Executive Order 13783 on March 28, 2017 titled “Promoting Energy Independence and Economic Growth”. He then issued Executive Order 13795 on April 28, 2017 titled “Implementing an America-First Offshore Energy Strategy”. These orders set off a series of actions within multiple agencies to change plans, guidance, and regulations related to onshore and offshore fossil energy development. On April 10, 2019 he issued two more executive orders aimed at speeding up energy infrastructure permitting. This page discusses Executive Order 13868, the “Executive Order on Promoting Energy Infrastructure and Energy Growth” (Energy Infrastructure EO). While this EO does not replace a prior order, its instructions to agencies will likely result in regulatory proposals that can be viewed as rollbacks of current regulations.

Visit our other tracker page on EO 13867 for information on the EO addressing presidential permits for international crossings. We have also prepared a series of pieces analyzing the April 10th executive orders. See the links at the bottom of this page for the related pieces.

Trump Era

April 10, 2019 President Trump signs two Executive Orders in Crosby, Texas, outside of Houston that he said would “cut through destructive permitting delays and denials” for energy infrastructure. One of these orders, EO 13868, was titled “Executive Order on Promoting Energy Infrastructure and Energy Growth” (Energy Infrastructure EO) and included 10 provisions that the administration hopes will speed up energy infrastructure projects in line with this administration’s focus on energy dominance and increased production. For information on the second order, visit our page here.

The Energy Infrastructure EO includes the following sections:

Section 1 is a statement of “purpose” that highlights the country’s energy resources and economic potential of the industry while identifying unbuilt infrastructure as a hindrance to development.

Section 2 is a statement of “policy” declaring it “the policy of the United States to promote private investment in the Nation’s energy infrastructure”. He then lists six ways the policy should do this, including: efficient permitting, regulations that reflect “best practices” and “best-available technologies”, timely action on projects, increased regulatory certainty, effective stewardship of resources, and “support for American ingenuity, the free market, and capitalism.”

Section 3 directs the EPA to review §401 of the Clean Water Act (CWA) and related regulations and guidance. CWA §401 gives states and Tribes the power to review federal permits or licenses that may result in discharges into navigable waters. States or Tribes must certify or waive their right to certify the proposed activity for the federal permit to move forward. The EO instructs the EPA to:

1) consult with States, Tribes, and agencies and review current regulations and guidance to determine if any should be “clarified to be consistent with the policies described in section 2” AND issues any new guidance to States, Tribes, and agencies as a result within 60 days of the order. (Sec. 3(b))

The order specifically requires EPA to review the Section 401 handbook from 2010 and to “take into account federalism considerations” while focusing on promoting timely collaboration, appropriate scope of reviews, appropriate types of conditions for certification, expectations for reasonable review times for the different types of certification requests, and the “nature and scope of information” needed for states and tribes to act. (Sec. 3(a))

2)  after issuing its own new guidance, the EO instructs EPA to lead an interagency review with the head of each federal agency that issues permits or licenses subject to §401 certifications and instructs the heads of those agencies to update their respective agencies’ guidance and initiated rulemaking as necessary within 90 days of the EPA completing its updated guidance. (Sec. 3(d))

3) review EPA’s implementing regulations for §401 and publish proposed rules revising these regulations within 120 days of the order. The EO instructs EPA to finalize these rules no later than 13 months after the order. (Sec. 3(c))

Section 4 instructs the Department of Transportation to initiate a rulemaking to update Part 193 LNG facility safety standards, develop rules using “risk-based standards to the maximum extent practicable, and finalize the updated rules within 13 months of the order. (Sec. 4(a)) This section also orders DOT to propose a rule no more than 100 days after the order and finalize it within 13 months that would permit LNG to be transported in rail tank cars in the same manner as other cryogenic liquids. Currently, LNG may be transported by truck and may be transported by rail only with Federal Railroad Administration approval and in United Nations portable tanks. This order is asking DOT to write rules to allow LNG transportation by cryogenic rail tank cars rather than UN portable tanks.

Section 5 instructs the Department of Labor to review data ERISA plans file with the agency to “identify whether there are discernible trends with respect to such plans’ investments in the energy sector.” The Sec. of Labor must provide an update to the Assistant to the President for Economic Policy within 180 days. It also instructs the Department of Labor to review its existing “guidance on the fiduciary responsibilities for proxy voting to determine whether any such guidance should be rescinded, replaced, or modified to ensure consistency with current law and policies that promote long-term growth and maximize return on ERISA plan assets.”

Section 6 instructs the Secretaries of Interior, Agriculture, and Commerce to “develop a master agreement for energy infrastructure rights-of-way renewals or reauthorizations” and “initiate renewal or reauthorization processes for all expired energy rights-of-way grants, leases, permits, and agreements” as appropriate within 1 year of the order.

Section 7 orders the Secretary of Transportation to consult with the Secretary of Energy and report to the Assistant to the President for Economic Policy within 180 days on “the economic and other effects caused by the inability to transport sufficient quantities of natural gas and other domestic energy resources to the States in New England” and other states or regions as appropriate. The order specifically requires the report to assess “whether, and to what extent, State, local, tribal, or territorial actions have contributed to such effects.” It also requires the Secretary of Energy to submit a report within 180 days (consulting with the Sec. of Transportation) on “the economic and other effects caused by limitations on the export of coal, oil, natural gas, and other domestic energy resources through the west coast of the United States.” Again, this report must assess non-federal jurisdictions’ contributions to such effects.

Section 8 instructs “the heads of agencies” to review “existing authorities related to the transportation and development of domestically produced energy resources” and report to the Director of the Office of Management and Budget and the Assistant to the President for Economic Policy within 30 days the authorities can be used to advance the policies outlined in the order.

Section 9 orders the Secretary of Energy to submit a report to the Assistant to the President for Economic Policy within 180 days on opportunities for the federal government “or otherwise” “to promote economic growth of the Appalachian region, including growth of petrochemical and other industries”, including an assessment of ways to diversify the Appalachian economy and promote workforce development.

Section 10 provides general disclaimers about the order not impairing or affecting any authorities granted by law or the functions of the OMB; notes it is to be implemented consistent with applicable law and subject to appropriations; and that it does not create any enforceable rights or benefits by any parties against the United States.

Agency Actions Implementing the EO:

June 7, 2019 EPA releases guidance pursuant to Section 3 of the EO clarifying timelines for state review, the agency’s interpretation of the scope of review and the information that can be considered. Section 401 of the Clean Water Act allows states to review federally permitted projects for their compliance with state’s water quality standards. Some states have used this ability to deny permits to coal terminals and pipelines. This guidance provides insight into the administration’s more limited view of the scope of states’ 401 certification authority.

For More Information: