We’re in a big moment, as the political landscape liquifies and reshapes beneath our feet. We at RDP expect to be spending significant time in coming months grappling with the vast impact of the 725-page Inflation Reduction Act and its tag-along coal baron wishlist (aka “permitting reform” bill), from the shifts in executive branch authority, funding, and personnel, to the bills’ diverging impacts on millions of people’s lives, and on ecosystems from Cook Inlet to the Appalachian Basin. Here’s a preview of some of the things we expect to focus on:
- Scrutinizing the discrepancy between the widely-cited models projecting rosy greenhouse gas emissions reductions from the bill and the bill’s mandated fossil fuel build-out.
When it comes to greenhouse gas emissions, it’s pretty clear that getting the numbers right is of existential importance. Emissions projections will always involve degrees of uncertainty, especially given the volatility inherent in relying on market incentives to determine the shifting balance of cheap energy sources. That said, there are a couple stand-out areas of concern for us with the most commonly cited models anticipating the Inflation Reduction Act’s impact, including the systemic undercounting of methane emissions and their warming potential.
This critique has broad application as well to the executive branch rulemaking process, where outdated, partial or deceptive numbers too often shape the conclusions of regulatory impact analyses. Scrutinizing and remedying those methodological flaws could fit with the administration’s efforts to modernize regulatory review, as could making the regulatory process more democratic and receptive to the public interest.
Just last week, the Associated Press released an investigation into the “hidden menace” of underreported methane leaks from oil and gas drilling in the Permian Basin. The investigation dug deeper into the 533 methane “super emitters” detected in 2021 by Carbon Mapper, a partnership between NASA’s Jet Propulsion Laboratory and several universities. AP discovered that the EPA’s greenhouse gas database, whose “figures are used by policy makers and scientists to help calculate how much the planet will warm in the coming decades,” often “fails to account for the true rate of emissions observed in the Permian [Basin].”
140 of the 533 facilities identified by Carbon Mapper were on track to exceed the EPA’s methane reporting limit, while the official EPA numbers identified only a few dozen sites exceeding that threshold. And AP found no track record of enforcement actions against facilities that fail to report accurate emissions: “though the Clean Air Act requires companies to accurately report greenhouse gas emissions, the EPA could not provide AP with a single example of a polluter being fined or cited for failing to report, or underreporting.”
It’s not only that the actual amount of methane being released into the atmosphere from U.S. fracking and drilling is being underreported to and by the EPA, with no enacted penalty for misreporting, or that the number of oil and gas wells in the Permian Basin continues to expand, which the UN Secretary General correctly describes as sheer “moral and economic madness.” There’s yet another worrisome aspect here, which is that the EPA uses the 100-year Global Warming Potential for methane, which it estimates is 27-30x that of CO2, instead of methane’s 20-year Global Warming Potential, which it estimates is 81–83x that of CO2.
Given that methane has much higher potency in its first two decades than over a century, using its 100-year GWP underestimates its impact in the next twenty years, and overestimates its impact later on—meaning that we may not be getting an accurate understanding of how near-future methane emissions could drive us to reach climate tipping points, whose cascading and irreversible impacts would reshape the globe. Given that many mainstream modelers likewise employ the 100-year GWP instead of the 20-year GWP, and use the government’s greenhouse gas database as a primary source, it is reasonable to ask whether these models might be underestimating methane’s devastating short-term potential.
With the media widely asserting that the IRA will reduce emissions by 40 percent, despite the bill’s natural gas build-outs, carbon capture provisions, and offshore drilling requirements, we need to have the most rigorous and correct modeling available to us to know whether this is true, and how much more government action is needed—by when—to prevent climate catastrophe. Last week an eloquent, terrifying scientific paper on how under-researched the plausible worst-case scenarios of climate change are drove home the stakes of systematically underestimating the impact of human activities on our precious, exhausted planet.
- Examining the impact of the IRS’s massive funding boost—and continuing to push for new IRS leadership as Trump holdover IRS Chief Charles Rettig is poised to inherit vast new spending authority and discretion.
The Inflation Reduction Act would appropriate almost $80 billion to the IRS, funding which is estimated to bring in $125 billion in revenue from increased tax compliance by 2031, and $250 billion by 2042. “With these funds, the IRS can finally hire more auditors and update data processing technologies to comprehensively detect tax cheats,” my colleague Glenna and I wrote last week. But there’s a catch: “the bill lays out that the IRS commissioner is responsible for developing a plan for how to allocate this funding within six months of its enactment.” The current IRS commissioner, Charles Rettig, was handpicked by Trump. We laid out several reasons why Rettig is not fit to continue serving in this role in our piece for the American Prospect. A few months prior, my colleague Toni Aguilar Rosenthal flagged the need for a Chief Counsel at IRS as well—there are only two political jobs at IRS, and one is held by Rettig; the other is vacant.
Rettig’s term is up in November 2022, but Biden has not indicated that he will move to replace him before midterms, nor foreclosed worrying talk on Capitol Hill about Biden possibly re-nominating Rettig. Whoever holds the position of IRS commissioner in the six months following the IRA being signed into law will oversee what may be the tax agency’s most consequential period yet, as it’s tasked with modernizing its processes, reducing the deficit, and cracking down on wealthy tax evaders. We don’t trust Rettig.
- Looking into new powers and spending authority granted to lesser-known executive branch personnel.
For example, in the coming weeks to months we’ll be taking a closer look at the carbon capture build-out in the IRA. Princeton Zero Lab’s preliminary report estimates that the IRA would “increase the use of carbon capture 13-fold by 2030 relative to current policy.” We’ll be looking at how the Department of Energy’s Office of Fossil Energy and Carbon Management (FECM) is involved in implementing the bill’s carbon capture funding, where carbon-captured Brad Crabtree is Assistant Secretary. The IRA appropriates an additional $150 million to the FECM “to carry out activities for infrastructure and general plant projects.”
The IRA also changes the conversation surrounding the hotly contested USPS plan to replace its aging fleet. IRA section 70002 would make up to $3 billion available to the USPS to electrify their fleet. (That’s $1.29 billion for zero-emission vehicle purchases, and $1.71 billion for the requisite infrastructure to support zero-emission delivery vehicles.) Back in January, the USPS estimated that it would need $3.3 billion to fully electrify its fleet. The bill seems to directly fulfill that ask.
On Monday night, the USPS held a public hearing on its new plan to buy 40 percent electric vehicles, up from 10 percent after sustained public pressure. Nearly every public comment at the hearing called on USPS to up the EV quota to 100 percent and build the fleet with union labor. The USPS has already received hundreds of thousands of public comments articulating the same demand. It’s hard to believe that with the $3 billion the USPS said it needed on its way to being codified into law, the agency could still be making plans for purchasing gas-powered trucks. Climate watch-dogs blasted USPS’s initial environmental impact statements for being wildly off-base in estimating the price of gas and EV maintenance (it assumed gas would only cost $2.19-$2.55/gallon through 2040!), and USPS’s own inspector general said that 99 percent of its routes could be served by EVs.
The IRA funds, if passed, mean that Postmaster Louis DeJoy can no longer honestly cite “high upfront investment costs” as a reason to buy fewer EVs. But if there’s anything we know about the USPS under DeJoy, it’s that we can’t stop sustaining public pressure until the agency finally caves to the public’s overwhelming demand. We’ve previously outlined alternative pathways to block the USPS’s gas-guzzling plan; our former colleague Mekedas Belayneh detailed for The New Republic this spring how the EPA could halt the plan by referring it to the CEQ, a proposal which got backing from over a hundred groups. Now that the IRA may make the pathway for full postal fleet electrification even smoother, there is simply no excuse.
- Looking into executive branch powers that may be undermined by the potential “permitting reform” bill, including the National Environmental Policy Act and Clean Water Act.
David Dayen had an excellent piece Tuesday noting how with Manchin’s support for IRA allegedly contingent on the later, separate passage of a “permitting reform” bill, the script has flipped from the decoupling of the infrastructure bill and Build Back Better last year: progressives, not moderates, now hold the cards. After the IRA is passed, progressives have the opportunity to negotiate or reject Manchin’s remaining wishlist. Here’s how Dayen assesses the impact of the shortened environmental review periods Manchin is pushing for:
“Depending on the language of the permitting reforms, either the timelines will remain exactly the same because of the lack of state capacity, or the timelines will just cut off reviews before they’re adequately completed, force corner-cutting, and heighten the possibility for errors or oversights. That will be exploited, at least at first, by fossil fuel interests. And once that infrastructure is built, it will be supremely difficult to dislodge in future years, weakening the climate benefits by drawing out the green transition timeline.”
Judging by this one-page summary from The Washington Post of provisions to be included in the unfinished bill, Manchin is effectively trying to manhandle executive branch agencies into approving the projects he and his fellow fossil fuel executives favor. (Note the American Petroleum Institute’s watermark on draft language for the bill.) West Virginia’s Mountain Valley Pipeline alone would emit every year an estimated 89,526,651 metric tons of greenhouse gasses, equivalent to 26 new coal plants or 19 million passenger vehicles. (That number comes from modeling by Oil Change International, which used the IPCC’s 20-year methane Global Warming Potential, then-estimated at 86x that of CO2. The IPCC’s 2021 estimate of methane’s 20-year GWP is 82.5 times that of CO2.)
My colleagues Dorothy Slater and Toni Aguilar Rosenthal outlined their prescient argument a few weeks ago that Manchin should not be allowed to compel trades between executive branch actions under existing law and legislation, and that such trades are a dereliction of the president’s responsibility to faithfully and fully execute the existing law. Though the legislative circumstances have rapidly changed, their analysis remains on point. They write:
“In a functioning democracy, the president would not view his obligations under existing law—which are, it bears reminding, the expression of democratic will—as bargaining chips for provisions in a new piece of legislation, even if the provisions could potentially be beneficial. Yes, Biden should be using his position at the bully pulpit to pressure legislators of his own party into supporting his agenda. But when negotiations happen, those negotiations must be within the parameters of the legislation, and should not involve dangling 30-year drilling projects, the merits of which are supposed to be decided based on existing law.”
As Manchin and his fossil fuel donors continue trying to push the heavy boulder of soon-to-be-stranded assets uphill, it would be foolhardy in the extreme for Democrats to unthinkingly lend a hand, compromising the momentum for more and better climate policy. We’ll be paying close attention to this bill-in-waiting’s ramifications for agency independence, authority and due process as fires burn to the west and to the east, and invisible plumes of methane gas rise across the south, detected only in infrared, warming our planet another fraction of a degree.
Want more? Check out some of the pieces that we have published or contributed research or thoughts to in the last week: