Daily on Energy: WOTUS fight renewed ahead of Sackett decision

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WOTUS DEBATE REJOINED: The Biden administration’s recently finalized waters of the United States rule has blown the longstanding debate over WOTUS back open just before the Supreme Court decides whether or not to scale back executive agencies’ ability to regulate water bodies under the Clean Water Act.

Democratic supporters of the rule have celebrated it as a return to certainty and environmental stewardship abandoned with the Trump-era WOTUS reforms.

Republicans meanwhile are hopeful the Supreme Court puts some new constraints on how widely the EPA and Army Corps of Engineers can sweep when defining the waters of the United States when it rules in Sackett v. EPA. In the meantime, they’re running their own campaign against the rule as the Biden administration just revised it.

House Transportation and Infrastructure devoted three hours to the matter last week in a hearing at which most of the witnesses, which included representatives from building and other trade associations, complained the new WOTUS rule is burdensome and compliance too costly.

Dual resolutions in the House and Senate seek to nullify the rule, finalized at the end of December, and House Republicans have asked the Biden administration to withdraw its rule until the Supreme Court lays down the law in Sackett.

What’s in the rule: The Biden administration undid a Trump-era rewrite of WOTUS and returned the definition to its pre-2015 state as finalized in 1986.

Under the Trump administration’s definition, which liberalized WOTUS at the request of many mining, industrial, and agriculture interests, interstate waters were excluded from WOTUS for the first time. Features like ephemeral streams – those that flow only in direct response to precipitation – that had been subject to regulation previously were also excluded.

The Biden revision adds interstate waters back to the WOTUS list and provides for regulation of ephemeral streams. It also added some key exclusions, however, including ditches that do not carry a “relatively permanent” flow of water.

Not enough for opponents: The Biden administration said it was confident the rule, which makes use of the “significant nexus” standard to determine jurisdiction over waters, reflects Supreme Court precedent and is legally sturdier than previous rewrites for that reason.

Critics of the new WOTUS rule generally supported the Trump-era rewrite and have complained that other versions of the rule make routine activities like homebuilding more difficult and costly.

It was the pre-2015 WOTUS definition that Michael and Chantell Sackett ran afoul of as they sought to build a home on their Idaho property beginning in 2007.

“We feel a bit like our hands are tied and to some extent afraid to do anything,” Alicia Huey, president of AGH Homes and chairman of the National Association of Homebuilders, told Jeremy.

What’s on the line in Sackett: “Significant nexus,” for one. The Sacketts petitioned the court to lay out a clearer standard for determining WOTUS jurisdiction than the significant nexus test, which lower courts relied upon in ruling that EPA had authority to regulate the couple’s lot.

If SCOTUS were to rule against the significant nexus standard, as the Sacketts hope, it could present new challenges for the Biden administration’s implementation of its new WOTUS rule, which uses the standard.

Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writers Jeremy Beaman (@jeremywbeaman) and Breanne Deppisch (@breanne_dep). Email [email protected] or [email protected] for tips, suggestions, calendar items, and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email, and we’ll add you to our list.

NEW TOYOTA CEO AIMS TO ACCELERATE SHIFT TO ELECTRIC VEHICLES: Incoming Toyota CEO Koji Sato said that he plans to place a new emphasis on electric vehicles, laying out an “EV-first mind-set.”

“We need to drastically change how we do business,” Sato said today in Japan, according to the Wall Street Journal.

Of note, Toyota has long been a leader in hybrid vehicles with the Prius, but does not sell many EVs. Sato said the company would develop a special manufacturing platform for EVs for its luxury Lexus brand.

OIL PRICES EDGE DOWN AHEAD OF INFLATION REPORT: Oil prices briefly edged down this morning ahead of the release of the Consumer Price Index report for January tomorrow morning, which is expected to play a major role in the Federal Reserve’s upcoming monetary policy decisions.

"Crude prices are softening as energy traders anticipate a potentially weakening crude demand outlook as a pivotal inflation report could force the Fed to tighten policy much more aggressively," Edward Moya, senior analyst at OANDA, told Reuters.

Brent crude was down 0.8% this morning before recovering.

Also, the first tanker loaded with Azeri crude departed from the Turkish port of Ceyhan since the earthquake struck a week ago. The resumption of crude shipments should ease supply concerns at the margin.

EAST PALESTINE ENVIRONMENTAL DISASTER UPDATES: A few updates regarding the environmental disaster following Feb. 3 Norfolk Southern derailment in East Palestine, Ohio:

– The mayor of the city has called a town hall meeting for Wednesday night for citizens to air concerns about the effects of the crash and chemical spill that resulted in evacuations.

– The EPA told Norfolk Southern Friday that it may be liable for damages and cleanup in certain areas.

– The EPA notice detailed three other chemicals released at the site, besides Vinyl Chloride and Butyl Acrylate: Ethylene glycol monobutyl ether, Ethylhexyl acrylate, and Isobutylene.

ICYMI: ENERGY DEPARTMENT PROPOSES NEW FRIDGE RULE: The Department of Energy announced new energy efficiency standards for refrigerators, freezers, and clothes washers on Friday, adding to the growing list of more than 110 energy efficiency rules and other actions the Biden administration has introduced.

The proposed standards, which would take effect in 2027, would set new values for per-year energy usage for new refrigerators and freezers. The residential clothes washer standard would similarly set new energy and water efficiency standards on a per cycle basis.

DOE said the standards would cut carbon dioxide emissions by some 233 million metric tons over the next 30 years, an amount approximate to the combined annual emissions of 29 million homes, and would collectively save consumers about $3.5 billion each year on energy and water bills.

Compliance costs for the fridge standards were estimated at $1.32 billion, while costs for the clothes washer standard were placed at $690.8 million.

The Biden administration champions its energy efficiency proposals as pro-climate and pro-consumer for the cost savings they’re forecasted to enable through reduced energy use and the emissions they’re meant to help avoid.

Some interest groups have complained, however, that the rules will drive up manufacturing costs, which are then passed on to buyers.

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10 am. 406 Dirksen. The Senate Environment and Public Works Committee will convene for a hearing to examine the future of low carbon transportation fuels in the U.S. and considerations for a nationwide clean fuels program.


10 am. 366 Dirksen. The Senate Energy and Natural Resources Committee will hold a hearing to examine the impact Russia’s war in Ukraine has had on global energy security nearly one year after its invasion. Learn more here.

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