Lawsuits Challenge Trump’s Rollback of Obama-Era Power Plant Wastewater Standards

One hallmark of the Trump administration is rolling back Obama-era environmental standards. Environmental groups fight the rollbacks with lawsuits. Nine environmental groups filed a lawsuit against the U.S. Environmental Protection Agency in early November over its rollback of national powerplant wastewater standards limiting water pollution from coal-fired power plants.

Filed in the District of Columbia Court of Appeals, the lawsuit challenges the EPA’s decision to roll back the Obama-era national standard. The EPA’s rollback allows coal-fired power plants to dump wastewater filled with toxic chemicals and heavy metals into rivers and lakes. Toxic heavy metals from coal power plant wastewater cause severe health problems, including cancer, reproductive issues, and impacts on children’s IQ. Wastewater also harms aquatic life. 

The Obama-era rule enhancine power plant wastewater standards

The Obama-era rule prohibited power plants from dumping fly ash or bottom ash wastewater into U.S. waters. It also imposed strict limits on toxic metals and other contaminants in sludge from power plants. Experts projected that the rule would have reduced an estimated 1.4 billion pounds a year of toxic heavy metals and other pollutants in waterways. 

Called the Steam Electric Effluent Limitations and Guidelines (ELG) rule, the EPA issued the rule in 2015. It was the nation’s first pollution standards to limit the number of toxic chemicals and heavy metals power plants can dump into the water. The rule required power plants to achieve zero discharge of fly ash and bottom ash wastewater and set strict limits on discharges of arsenic, mercury, selenium, and nitrogen in scrubber sludge wastewater. The rule also required power plants to implement a closed-looped/zero discharge system for wastewater to remove coal ash in boilers. 

“This absurd step backward is little more than a gift to the dirty fossil fuels industry at the expense of people’s health, endangered wildlife, and water quality,” said Hannah Connor, a senior attorney at the Center for Biological Diversity. “Many power plants could easily adopt affordable technologies that dramatically reduce toxic discharges, but with this rule, the EPA is telling their polluter friends not to bother with these common-sense measures.”

The Southern Environmental Law Center lawsuit

The Southern Environmental Law Center filed a lawsuit in early November challenging the Trump administration’s rollback of the Obama-era rule. The lawsuit filed in the  U.S. Court of Appeals for the Fourth Circuit was filed on behalf of the Stokes County Branch of the NAACP, Winyah Rivers Alliance, Appalachian Voices, and Good Stewards of Rockingham, which represent communities downstream and close to coal plants in the Carolinas. 

Two power plants represent the dangers that the rollback of the rule poses. Santee Cooper’s Winyah Plant in South Carolina is set to decommission all its coal-fired units by 2027. The company may not be required to implement pollution controls or meet the weaker limits under the new rule thanks to a loophole. Duke Energy installed new technology to limit wastewater pollution at its plants in North Carolina as required by the 2015 rule. The new rule allows the company to pollute more. Communities in North Carolina experienced increases of byproducts in their treated drinking water that cause cancer due to bromide pollution from upstream coal-fired power plants. 

“This illegal rollback of clean water protections by the Trump administration allows dirty coal-burning plants to dump more toxic substances into our rivers, lakes, and drinking water reservoirs and exposes our communities to more cancer-causing pollution,” said Senior Attorney Frank Holleman, in a statement. “ Instead of protecting people, this administration made it easier for the most polluting and worst run coal-fired plants to dump poisons into the waterways our communities depend upon.”

The good news

There is good news, not just for power plant wastewater standards, but for planet earth: on January 20, 2021, President Trump will leave office. He leaves behind an environmental mess that former Vice-President Joe Biden will be left to clean up. A glance at Biden’s environmental policies indicates he will reinstate Obama-era environmental standards.

Trump Administration Bails Out the Declining Oil and Gas Industry

The Federal Reserve and U.S. Treasury Department began a corporate bailout in March. Since then, oil and gas companies issued $99.3 billion in new bonds, a report by Friends of the Earth, Public Citizen, and BailoutWatch found. 

The Federal Reserve bought debt from 19 oil and gas companies, and those companies have since sold debt investors over $60 billion in new bonds. Their bond sales represent about 60 percent of energy debt issuance during that period. Twelve of the 19 companies received downgrades of their short-term debt, long-term debt, credit, or default ratings from major credit rating agencies since the bailouts in March. 

The total tally of new bonds issued this year by oil and gas companies is $129 million, which is a record going back at least a decade. This year marked the highest level of energy debt issued since 2010. “This surge in borrowing was made possible by the Fed’s promise to purchase large quantities of corporate debt,” the report stated. 

There is a big gap between the favorable treatment given to corporations and the treatment of municipalities, small businesses, and individuals, the report noted. States and municipalities have been offered much more restrictive loan terms than have private companies although municipal bonds are far less likely to default than corporate debt. Chevron and Wisconsin serve as good examples. The Federal Reserve bought a Chevron bond at a rate of about 0.9 percent over four years. Wisconsin has the same credit rating as Chevron but has to pay about 1.3 percent over three years. 

“This bailout is an unprecedented rescue of a dying industry,” said co-author Alan Zibel, research director of Public Citizen’s Corporate Presidency Project, in a statement.

“Instead of bailing out climate-destroying fossil fuel companies, we must assist small businesses, local governments, and individuals facing dire financial straits.”

Alan Zibel

The oil and gas industry declined until Trump’s corporate bailout

Earlier this year, before the pandemic and the oil price war between Russia and Saudia Arabia caused global demand to sink to an all-time low, the oil and gas industry “showed unmistakable signs of decline,” according to the report. Moody’s. The credit rating agency forecast in February a higher risk of default and a harder time borrowing for the oil industry. Some companies may not have made it if the Federal Reserve had not stepped in. 

Despite the intervention of the Federal Reserve, the oil and gas industry will continue to decline. The consulting firm Rystad Energy forecasts that up to 190 oil-related bankruptcies by the end of 2022 if prices stay low. The firm also warns that investors, including the Federal Reserve, are less likely to be repaid. The report by the three environmental organizations points out that “a bad investment by the central bank can harm taxpayers.”

A total of 12 fossil fuel companies that received investments by the Federal Reserve received downgrades of their debt or credit ratings from major rating agencies since March. EQT Corporation is one of those companies, and its debt was downgraded to junk by Moody’s before the pandemic. Yet the company was able to sell $500 million in bonds in the second quarter of this year. 

The Bureau of Land Management bails out a company that owes back taxes

The Federal Reserve is not the only one to give bailouts to oil companies. The Bureau of Land Management provided US Realm Powder River a 96 percent discount on 23 federal leases in Wyoming even though it owes $4 million in unpaid federal royalties and failed to pay local taxes for the last three years. According to a report by the Western Values Project, US Realm Powder River is either the sole or majority lessee on 16 Bureau of land management leases on over 7,976 acres that were given a reduced royalty rate to 0.5 percent. 

“Once again, the Trump administration has opted to put polluters over people without a second thought while taxpayers foot the bill,” said Western Values Project Director Jayson O’Neill. 

What you can do

There is something you can do if you are tired of the oil and gas industry bailout from the government. Vote on November 3. Let your voice be heard at the ballot box.


Photo by Zbynek Burival on Unsplash