Scott Segal on DOE and EPA Nominees

Insight - March 04, 2013

Today, President Obama has indicated his intention to nominate two key members of his energy and environmental team:  Gina McCarthy for EPA Administrator and Ernie Moniz for Energy Secretary.  These two individuals seem fit to task of the agencies they will lead if confirmed.  However, both will face substantial policy challenges, particularly as they grapple with carbon regulatory alternatives.

Gina McCarthy comes to the Administrator position having already served as Air Administrator.  Given that the recent rules arising under the Clean Air Act are some of the most expensive in EPA history, McCarthy has significant experience with wide-sweeping stakeholder contact.  What many in industry appreciate about her style is her directness and openness to engagement with the regulated community.  Almost every large EPA rule has errors – both in policy and methodology.  McCarthy listens and allows for the possibility of midcourse corrections.

Of course, we often disagree with the final rules that have been advanced under McCarthy’s watch.  Particularly, the statement of costs and benefits under the MATS rule seemed jiggered to create an overly rosy impression of the rule.  But in each case, final rules seem better than proposed rules – which is a good thing.

Carbon is the real challenge.  If the final rule for carbon emissions from new power plants and potential proposals for existing plants and even some industrial sources are too inflexible or unrealistic, the weak economic recovery in the United States can be effectively reversed.  Given that other nations are not likely to follow our lead, such an outcome would result in jobs lost, projects scuttled, energy prices increased – all with no change in global warming.

As for Ernie Moniz, his work both in the Clinton Administration and at MIT disclose a solid understanding of the DOE and its mission.  He was no passive observer of the shale gas revolution nor of the promise of carbon capture and sequestration technology – having reviewed both from his position at MIT with thoughtfulness and rigor.  Some have criticized him for recognizing that fossil fuels are the only bridge to newer technologies.  But comments like that only show that he can be counted on to be more clear-eyed as America faces important energy choices in coming years.