Recent Biden Administration Orders Affecting the Energy Industry
In his first week in office, President Biden and administration officials have issued various Executive Orders, memoranda and other agency directives reversing previous Trump Administration policies and/or establishing new policies for federal agencies, which some have characterized as a fossil fuel freeze. Included in these are federal directives specifically affecting the oil, gas, mining, and renewable energy sectors. These executive actions include:
I. Suspension of Delegated Authority to BLM District Offices to Approve Permits, Rights of Ways, Easements and Other Actions.
a. On January 20, 2021, Acting Secretary of Interior Scott de la Vega issued Order No. 3395.
i. Stated purpose:
- To “ensure[s] that the Department [of the Interior] continues its existing operations . . . consistent with all legal obligations and policy goals to uphold trust and treaty responsibility to tribal nations and to responsibly steward the Nation’s public lands, waters, and resources for current and future generations.”
ii. What it does:
- Requires that the following decisions normally made in BLM District Offices be reserved to the Senate-confirmed or acting non-career official who has been delegated the authority to exercise the authority associated with the Secretary of Interior, Deputy Secretary, Solicitor, and six Assistant Secretaries identified in the Order:
- Publishing any notice in the Federal Register, including notices of final agency action and National Environmental Policy (NEPA) actions;
- Issuing, revising, or amending Resource Management Plans (RMPs) under Federal Land Management Policy Act (FLPMA);
- Granting rights-of-way (ROWs), easements, or any conveyance of property;
i. The wording of the Order is potentially ambiguous; it is possible to read the Order as limiting the suspension to those ROWs that “authorize ground-disturbing activities”;
- Approving plans of operation under the 1872 General Mining Law;
- Issuing any final decision with respect to R.S. 2477 claims;
- Hiring personnel above the level of GS 13; and
- Issuing “any onshore or offshore fossil fuel authorization, including but not limited to a lease, amendment to a leases, affirmative extension of a lease, contract or other agreement or permits to drill.” (Emphasis added.)
iii. The Order provides that the restriction on fossil fuel authorizations “does not limit existing operations under valid leases. It also does not apply to authorizations necessary to: (1) avoid conditions that might pose a threat to human health, welfare, or safety; or (2) to avoid adverse impacts to public land or mineral resources.”
- The Order does not define “existing operations” under valid leases. BLM Field offices routinely approve sundries filed by operators associated with the drilling, completion and production of wells, including flaring requests, and these activities are planned months in advance. The BLM’s Sundry Notice Form 3160-5 is used to both inform the BLM of activities being undertaken, i.e. subsequent report as well as notice of intent to conduct activities which are subject to BLM approval. Where actions approved under a sundry notice will result in new or additional surface disturbance, the proposal must include a surface use plan or refer to an approved SUP and the BLM may conduct a field inspection and impose conditions of approval which may be subject to the suspension of local approval authority. See 43 CFR §3162.5-1(a).
iv. Duration of Order:
- The Order will remain in effect for 60 days or until revoked or amended.
b. Indian Lands Unaffected by the Order:
In response to objection by tribes, in a follow-up memo to department leaders sent on January 25, 2021, a Senior Counselor to the DOI Secretary clarified that: “the temporary suspension of delegated authority for the list of actions described in the order applies to non-Indian federal lands and does not apply to actions taken with respect to Indian tribal and individual trust and restricted lands, including approval of any activities on those lands required by existing law.”
c. Legal Challenge
On January 27, 2021, the Western Energy Alliance filed a Petition for Review of the Order in U.S. District Court of Wyoming. The petition alleges that “[t]he suspension is an unsupported and unnecessary action that is inconsistent with the Secretary’s statutory obligations.” The U.S. District Court in Wyoming has been a favorable forum for other cases involving challenges to federal government in the energy arena, but it is unclear how a temporary suspension authority will be viewed by the courts. The Order recites as the basis for the suspension, 5 U.S.C. § 2 of Reorganization Plan No. 3 of 1950, 64 Stat. 1262, which prescribes the Secretary’s authority to reorganize the bureaus and offices of the DOI.
II. Executive Order Impacting Renewable and Fossil Fuel Energy Sectors.
- On January 27, 2021, the Biden Administration issued its “Executive Order on Tackling the Climate Crisis at Home and Abroad.”
- The Order is sweeping in scope with various objectives designed to place climate change at the forefront of the country’s domestic and foreign policy and planning.
- Several of those actions mandated by the Order relate to the fossil fuel and renewable energy sectors in particular. Those actions include:
- Establishing a task force to develop a plan that will, among other things, “aim to use . . . all appropriate [federal] procurement authorities to achieve or facilitate . . . a carbon pollution-free electricity sector no later than 2035 . . . .” (Order § 205(b)(i))
- Requiring the DOI Secretary to review siting and permitting processes on public lands and offshore waters to identify steps that can be taken to increase renewable energy production on those lands and waters. (Order § 207)
- Requiring the DOI Secretary, to the extent consistent with applicable law, to “pause new oil and gas leases on public lands or in offshore waters, pending completion of a comprehensive review and reconsideration of Federal oil and gas leasing practices … including potential climate and other impacts associated with oil and gas activities on public lands or in offshore waters.” (Order § 208)
- Requiring the DOI Secretary during the review of leasing practices to “consider whether to adjust royalties associated with coal, oil, and gas resources extracted from public lands and offshore waters, or take other appropriate action, to account for corresponding climate costs.” (Order § 208)
- Requiring the Chair of the Council on Environmental Quality (CEQ) and the Director of the Office of Management and Budget (OMB) to take steps, consistent with applicable law, “to ensure that Federal infrastructure investment reduces climate pollution, and to require that Federal permitting decisions consider the effects of greenhouse gas emissions and climate change.” (Order § 212)
- The Order also requires the CEQ Chair and OMB Director to “review and report to the National Climate Advisor on siting and permitting processes, including those in progress under the auspices of the Federal Permitting Improvement Steering Council, and identify steps that can be taken, consistent with applicable law, to accelerate the deployment of clean energy and transmission projects in an environmentally stable manner.” (Order §212)
- Requiring the heads of federal agencies to identify “any fossil fuel subsidies provided by their respective agencies, and then take steps to ensure that, to the extent consistent with applicable law, Federal funding is not directly subsidizing fossil fuels.” (Order § 209)
- The Order also requires that “fossil fuel subsidies” be eliminated from budget requests from Fiscal Year 2022 onward. (Id.)
- Requiring the DOI Secretary, in consultation with the Secretary of Agriculture, the Secretary of Commerce, the CEQ Chair and the heads of other relevant agencies, to submit a report to the Task Force within 90 days of the date of this order recommending steps that the United States should take to conserve at least 30 percent of U.S. lands and waters by 2030. (Order §216).
III. Memorandum on Tribal Consultation and Strengthening Nation-to-Nation Relationships (January 26, 2021)
- Purpose: To make regular, meaningful, and robust consultation with Tribal Nations cornerstones of Federal Indian policy.
- Requires the head of each agency to submit to the Director of OMB within 90 days of the date of this memorandum, a detailed plan of actions the agency will take to implement the policies and directives of Executive Order 13175 issued November 6, 2000. This order includes various directives concerning tribal consultation and consideration of tribal sovereignty an interest when formulating and implementing policies.