After three high-profile takeovers of permitting at three large Texas industrial plants, the Environmental Protection Agency has raised the hackles of state politicians and brought criticism of undue meddling that will cost the state’s economy jobs.

That fight continues, with the federal agency scheduled to make a final decision on June 30 on the state’s controversial system of “flexible” permitting. But it’s hardly the only recent move by regulators to impose new environmental restrictions that will affect Texans.

Earlier this month, the EPA announced — for the first time in 40 years — that it is tightening rules nationally on sulfur dioxide emissions, which come from coal plants and other sources. Under the Obama administration, the agency also is preparing new regulations on a range of issues, from ozone pollution to waste from coal plants to the granddaddy of them all: greenhouse gas pollution. Predictably, the new regime has delighted Texas environmentalists while provoking businesses that fear damage to a fragile economic recovery.

"There's no doubt that the Obama EPA has different priorities than the previous EPA," said Ilan Levin, the Texas program director for the Environmental Integrity Project, a nonprofit that advocates for better enforcement of environmental laws.

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Greening the greenhouse

Several of the initiatives actually started late in the Bush administration, said Tom "Smitty" Smith, the Texas director of Public Citizen, the environmental and consumer advocacy group. In August, for example, the EPA is expected to tighten ozone pollution requirements, rendering a number of Texas cities — including Austin, San Antonio, El Paso and Waco — out of compliance with federal requirements. (Houston, Dallas and Beaumont-Port Arthur are already out of compliance under current standards.) The Bush administration had issued a new ozone limit in 2008, but the Obama administration has pulled that rule in favor of an even stricter one.

“You don’t get to do that,” pronounced Stephen Minick, the vice president for government affairs at the Texas Association of Business, protesting the new administration’s swapping out of the weaker Bush rule. The move typifies the new administration’s heavy-handed approach to a range of issues that will impact Texas, he said.

"What you see is, quite frankly, the same kind of broad approach you're seeing in health care reform and labor law reform — this tension between a states'-rights issue and what we feel is the focus of new administration, which is to essentially standardize and federalize every program," he said. 

Greenhouse gas regulation has also brought a more aggressive approach from the new administration. In a landmark 2007 case, the U.S. Supreme Court ruled that the EPA had the authority to regulate emissions contributing to global warming. The EPA under Bush hedged, but the Obama administration appears ready to move. It has already found that the gases endanger human health and welfare, a necessary legal precursor to regulation — and one that Gov. Rick Perry's administration is challenging in court.

Due partly to its heavy concentration of industry — including chemical plants, cement kilns and oil refineries — Texas has more greenhouse gas emissions than any other state and therefore may bear the heaviest burden under stricter regulations. Legal challenges aside, the greenhouse gas regulation likely will march forward under the Obama regulation: The EPA is due to start regulating large industrial plants in January. (Congress could create a different regulatory structure under controversial “cap-and-trade” legislation, but this is an increasingly unlikely scenario in the polarized Washington political environment.) Smith says Texas has done nothing so far to prepare for the onset of the regulations and so will be hit all the harder.

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"So blatant and so arrogant"

The EPA is looking into other issues crucial to Texas's energy industries. For the first time, the agency proposes to regulate waste from coal-ash. In April, the agency proposed rules that would cut emissions of lead and mercury from boilers — which burn natural gas or other types of fuel to create steam, which in turn creates electricity — and some solid waste incinerators.

Yet another issue critical to Texas is hydraulic fracturing, the practice of shooting water and chemicals below ground at high pressure to extract natural gas. The EPA is conducting hearings around the country on whether the practice, commonly called "fracking," impacts water supplies. On July 8, the debate will come to Fort Worth, near where the method is employed heavily in the gas-rich Barnett Shale. Currently, fracking in Texas is regulated by the Texas Commission on Environmental Quality and the Texas Railroad Commission, which oversees the oil and gas industry. But the EPA is studying the issue in the wake of Congressional interest in potentially ending an exemption from federal oversight of fracking in the Safe Drinking Water Act.

In the near term, the battle between Texas business interests and Washington regulators will remain centered on the EPA's tussle with the TCEQ over air-pollution permitting for a few of Texas's largest factories. The EPA has taken over permitting for three big Texas plants and is threatening to take over more if Texas does not shape up.

On June 11, the Texas Oil & Gas Association and the Texas Association of Manufacturers filed a petition in the 5th U.S. Circuit Court of Appeals in New Orleans, challenging EPA action on Texas's air-permitting program.

The EPA’s incursion into state permitting has served to “hurl the state's major job producers into a world of uncertainty," because they will not know what rules to follow, said Debbie Hastings, the vice president for environmental affairs for the Texas Oil & Gas Association, in a statement. Echoing Perry and a parade of industry representatives, she says that Texas' air pollution has improved over the years. Environmentalists counter the improvement has come through federal regulation rather than any voluntarily effort of Texas. "The truth is, the last thing the EPA wants to do is take over this process, because they don't have the resources allocated to this," says Jim Marston, the Texas director of the Environmental Defense Fund. But the agency has no choice, he said, because “Texas is being so blatant and so arrogant."

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