Corporate heavyweights split with Trump on energy regulatory rollbacks
Illustration: Rebecca Zisser/Axios
For the first time yesterday, the U.S. Chamber of Commerce publicly split with the White House over its plan to freeze Obama-era vehicle emissions and mileage rules.
Why it matters: While K Street is directionally inclined toward deregulation, there can be colliding interests below the surface. And that's certainly the case when it comes to the oil and auto industries.
- It came the same day that Shell, BP and ExxonMobil issued statements opposing EPA's new draft rule to roll back regulation of the potent greenhouse gas methane from oil-and-gas development.
- The supermajors' statements were a contrast to lobbying groups representing independent oil-and-gas companies, which cheered the EPA plan.
Where it stands: The Chamber, in a letter to U.S. and California regulators, urged them to strike a deal that enables continued increases in standards yet weakens the Obama-era targets.
- The Chamber says that if the White House and California can't reach a deal to maintain a single set of rules, the result will be uncertainty, job losses, and delayed spending on safety and emissions tech.
- In an accompanying report, they argue that Obama's rules for increasing standards through the mid-2020s are too much, too fast — but President Trump's plan is "misguided and insufficient." It's a stance that echoes major automakers' posture.
The big picture: The disputes show how the administration's moves to unwind Obama-era climate policies are too much for some segments of these industries, notably big players who...
- Face intense public and investor pressure on global warming.
- See a competitive edge if environmental regulations are maintained or, as some oil majors want in the case of methane, even expanded.
- In the automakers' case, fear the uncertainty that would stem from a messy court battle, and loathe the idea of a bifurcated U.S. market.
The intrigue: Let's be clear — oil majors are not Greenpeace. Instead, maintaining regulations gives them a competitive advantage thanks to their huge financial resources.
- And while they're free to continue cracking down on methane even in the absence of regulation, the rollback creates other problems.
- As Bloomberg's Jennifer Dlouhy points out, global giants like Shell and BP have "warned the administration’s retreat on methane threatens to undermine the sales pitch for natural gas as a source of electricity that burns cleaner than coal."
Go deeper: Big Auto's rupture with Trump