While the nation’s population has doubled in the last half century, the amount of federal regulation has grown by 1,700%. Forbes estimates that “‘more than 1 million restrictions in the Code of Federal Regulations are either duplicative, have costly unintended consequences, are obsolete or perform poorly.’” America’s energy industry lives with this burden, too. New energy projects require up to “forty-seven approvals from nineteen different governmental entities” (Philip Howard, Rule of Nobody).
Rapidly changing industries also generate regulatory mismatches. Think of how quickly oil and gas prices move and the speed at which energy technologies advance. It’s hard to regulate something that’s constantly shifting. Years will pass between the time at which an energy policy is initially proposed and when it finally gets implemented (in the form of regulations). By then, the policy may already be obsolete.
The purpose of my Reimagine Energy talks is to discuss ideas for improving energy policy that could be supported by Democrats and Republicans. The two parties may disagree about how much regulation is needed and where—but both should want to enhance the process. Regulatory mismatch is not in anyone’s interest.
Procedural improvements that could make any American energy policy more responsive to fast-moving markets and technologies include:
- Omnibus Energy Act. As a starting point, let’s repeal all existing energy policies, including the “seventy-nine renewable energy programs” that even Wikipedia struggles to explain. Congress might ultimately retain some of the existing regime, but no law or regulation would be sacred. The surviving (and new) policies would be consolidated into a single, coherent energy law (the “Omnibus Energy Act”), supplanting and replacing all that preceded it.
- Consolidate Authority in One Agency. Energy cannot be responsibly and efficiently regulated by multiple agencies. As popular as the Clean Power Plan may be with Democrats, does the Environmental Protection Agency really have the expertise to assume control over the nation’s electricity grid? Republican proposals to abolish the Department of Energy (DOE) (and reallocate its programs to other agencies) would only further fragment responsibility. One compromise is to keep the DOE but make it the exclusive regulator of all things energy. The energy industry would be exempted from regulation by any other agency, including the EPA. Whatever energy policies the nation decides upon, let’s implement them transparently through one agency solely accountable for its good or bad results.
- Restore Congressional Oversight. Our 535 senators and representatives now spend most of their days allocating the nation’s ~$4 trillion annual budget. Lawmakers have little time remaining to focus on policy, leading to calls for a biennial budget cycle (similar to that used by the Texas Legislature). Irrespective of whether other agencies retain annual budgets, the Omnibus Energy Act would require the DOE to operate on a biennial budget. Congress’ energy committees could then focus on policymaking in the alternating years, adjusting statutes for changes in market conditions and technologies.
- Sunset of the Omnibus Energy Act. The Omnibus Energy Act would expire in its entirety every ten (10) years, requiring lawmakers to reconsider the nation’s energy policy anew. In the absence of an expiration date, America’s constitutional system tends toward perpetuity. Once enacted, a law’s beneficiaries need only focus their lobbying efforts on a handful of “swing” lawmakers—just enough to block its repeal. Expiration also would discourage overreaching by either party during the few years each controls both the presidency and congress (since 1980 Democrats have controlled for two stints of two-years each and Republicans for one period spanning four years).
Surely both Democrats and Republicans can agree that our fragmented energy policy is a mess. A restatement of energy law along the lines of the Omnibus Energy Act would repeal layers of aging and burdensome regulations. Rather than abolish the DOE, the agency would become the industry’s sole and exclusive regulator. Congressional oversight of a more powerful DOE would be bolstered through a biennial budget cycle, with energy policy being subject to heightened scrutiny in alternating years. These two-year reviews would culminate with decennial expirations of all energy laws and regulations, helping to cull any outlier policies enacted during brief periods of one-party control. Collectively, such procedural reforms should better align American energy policy—whatever it may be—with rapidly changing markets and technologies.
About the Gaille Energy Blog. The Gaille Energy Blog discusses issues in the field of energy law, with weekly posts at http://www.gaillelaw.com. Scott Gaille is a Lecturer in Law at the University of Chicago Law School, an Adjunct Professor in Management at Rice University’s Graduate School of Business, and the author of two books on energy law (Shale Energy Development and International Energy Development).