Smoke Screen
I've been remiss in waiting this long to mention Bruce Barcott's interesting article on the Bush Administration's environmental policy in the NY Times Magazine of April 4, 2004. In "Changing All the Rules" (which has now gone into the NYT archives), he describes the impact of changes in "new source review" rules for the electric power industry. Under this provision, power plants can perform necessary maintenance, but any upgrades or expansions trigger a requirement to meet current emissions rules and install the best available emission control technology. Mr. Barcott's article focuses on past violations of this standard and the new administration's efforts to make it less onerous for industry.

I'm not in a position to verify all the information in the article, but at least one fact that underpins his argument that environmental regulations have not stifled the expansion of generating capacity to meet demand, requires further clarification. The "fact" in question relates to the California power crisis of 2000-01. The author states, "We now know that California's energy shock was largely caused by market manipulation (by Enron, among other companies) and regulatory breakdown, not by a drought in supply." This is not a fact, but rather an assertion. An examination of the facts would reveal that two other major factors contributed to California's problems, in addition to those he cites.

First, the Pacific Northwest, from which California imported a significant portion of its incremental power, was experiencing a water drought that curtailed hydroelectric generation. More germane to the issues in the article is the trend leading up to the period of "deregulation", in which the state's power reserve was steadily eroded by the rapid growth of demand in the 1990s and the difficulties utilities faced in getting new plants permitted and constructed. From an industry perspective, the balance between environmental protection and the provision of energy critical to economic growth and personal comfort had swung too far in one direction.

The latter point encapsulates much of my discomfort with Mr. Barcott's approach. He raises issues meriting serious concern, and his observation about major changes in environmental policy being driven by bureaucratic fiat, rather than by Congressional action, is essentially correct, though hardly unique to this administration. However, his overall argument is undermined by the breathless tone of conspiracy that comes across in much of the piece.

While it is tempting to see the insertion of so many people with energy industry connections into the EPA and Dept. of Energy as simply putting the fox in the henhouse, there is another perspective on this. What I recall from my two decades in the oil industry was the relentlessly adversarial approach taken for most of that time by environmental regulators who had little appreciation or concern about the benefits the industry provided, seeing it only as a massive polluter.

When the Bush Administration took office, there was a sense in the parts of the industry with which I was involved of finally having someone in Washington who understood the complexity of the country's energy systems and who might be willing to listen to the input of those who actually run the machines that deliver power and fuel to a country that cannot do without them. Quite possibly this was taken too far, and the balance has swung in the opposite direction from the last twenty years. An article that presented both sides of the story would have been fairer but probably far less gripping and politically useful in an election year.