Analysis by Energy Workforce President Tim Tarpley
Energy will likely play front and center in the national political debate this week. The Supreme Court is expected to make a major decision regarding the “Chevron Deference” doctrine, which will have significant implications for climate and environmental regulations affecting the US energy industry. The Court is expected to release a ruling that limits the powers that agencies have used under “Chevron Deference” to regulate in areas without specific congressional authority. This doctrine has allowed agencies to interpret their regulatory authority broadly when statutes are silent or vague. In recent years, agencies have used this broad interpretation to regulate new areas where they have not historically been involved.
The vagueness has been used recently by the Biden Administration to push his whole of Government approach to climate issues and to support agencies authority to push out new regulations on power plants, tailpipes, ESG and more. Defenders of this doctrine have argued that it’s necessary to give executive branch agencies some leeway to respond to new and evolving issues. However, conservatives have long argued that this is a separation of powers issues and if agencies are going to regulate in a particular area, they must first have specific congressional authorization. Ultimately, Congress has the power of the purse and agencies are given particular appropriations levels to enact certain regulatory powers. Anything beyond that exceeds their intended authority.
The implications of this ruling could be quite significant for our industry. Agency power has grown dramatically over the past two decades. At the same time, Congress has become virtually deadlocked with the body incapable of passing much of anything significant. This deadlock is expected to continue for the near term. With the deadlock continuing, agencies have moved to more legislating via regulation than ever before. With the court expected to curtail this authority, the next President will have to operate within these new rules. Agencies will be much more limited in what they can do and in what areas they can regulate. It will also give ammunition to lawsuits like those against the SEC ESG rule and others that argue these new regulatory actions are beyond the agencies’ original scope of regulatory authority.
Also expected to be quite impactful this week: former President Trump and President Biden will face off on Thursday night in the first Presidential debate hosted by CNN. Both campaigns have chosen to forgo the traditional Presidential Debate Commission and have the debate hosted directly by the network itself. So far, energy issues have played a somewhat minimal role in the debate with both candidates focused on other issues. However, we will all be watching on Thursday to see if that changes and energy takes a front seat.
It will be telling to see if President Biden touts the $783 billion Inflation Reduction Act and if President Trump attacks Biden for his LNG “pause” or his slow walking of federal lease sales offshore. Any mention of energy will be key indicators of areas of debate for the remainder of the election cycle. Polls currently show the race as essentially a coin flip, so performance for both candidates at the debate will be key to determining how this race goes for the remainder of the cycle. Both candidates have high negatives among the expected voting public so there is still a large swath of voters that could be swayed by a bad performance for either. We can expect polling about a week or so after the debate to show us trends of which way this will go.
Tim Tarpley, Energy Workforce President, analyzes federal policy for the Energy Workforce & Technology Council. Click here to subscribe to the Energy Workforce newsletter, which highlights sector-specific issues, best practices, activities and more.
