trending Market Intelligence /marketintelligence/en/news-insights/trending/oNJp42gc94xRzA8n6uiJuw2 content esgSubNav
In This List

Watchdog group alleges acting US EPA chief may have broken ethics pledge


See the Big Picture: Energy Transition in 2024


IR in Focus | Episode 10: Capital Markets Outlook


Infographic: The Big Picture 2024 – Energy Transition Outlook


The Big Picture: 2024 Energy Transition Industry Outlook

Watchdog group alleges acting US EPA chief may have broken ethics pledge

A government watchdog group Jan. 15 asked the U.S. Environmental Protection Agency's inspector general to investigate whether Acting Administrator Andrew Wheeler violated an ethics pledge by participating in rulemakings championed by his former lobbying client, Murray Energy Corp.

The complaint, filed by Citizens for Responsibility and Ethics in Washington, or CREW, alleged that Wheeler may have run afoul of a two-year recusal agreement he signed after leaving the Faegre Baker Daniels law and consulting firm to join the EPA as deputy administrator in April 2018. As a registered lobbyist with Faegre, Wheeler's highest-paying client was Ohio-based Murray Energy, which paid the firm nearly $3 million between 2009 to September 2017 "primarily for Mr. Wheeler's lobbying services," according to the complaint.

Wheeler only served as deputy administrator for several months before stepping up to lead the agency on an acting basis after former EPA Administrator Scott Pruitt resigned in July 2018 amid a cloud of ethics investigations. He is scheduled to appear before the Senate Environment and Public Works Committee for a confirmation hearing on Jan. 16 after President Donald Trump recently nominated him to become the EPA's administrator.

In addition to other lobbying activities, CREW's complaint raised questions about Wheeler's involvement in a pair of recent EPA policy proposals related to coal ash and coal-fired power plants favored by Murray Energy in correspondence with Trump administration officials.

Coal ash and CO2 regulations

According to the complaint, Wheeler helped arrange a March 2017 meeting between Department of Energy Secretary Rick Perry and Murray Energy CEO Bob Murray. During that meeting, Murray reportedly handed Perry an action plan that made a top priority the revision of the EPA's Coal Combustion Residuals, or CCR, rule to give more flexibility to states to establish their own standards.

Issued under the Obama EPA, the regulation established minimum federal standards for wet coal ash impoundments and dry landfills used to store coal residuals, a byproduct of burning the fossil fuel for electricity. The rule also introduced minimum public reporting requirements, leading to a wave of recent revelations about groundwater contamination at unlined coal ash ponds.

Wheeler's ethics pledge prohibits him from participating "in any particular matter involving specific parties" directly and substantially related to Murray Energy and other former lobbying clients for two years after his appointment. However, as acting administrator, one of Wheeler's first major actions was to sign off on revisions to the CCR rule in July 2018 that gave states the ability to establish their own coal ash disposal programs. The changes were "consistent with Murray Energy's request," CREW's complaint asserted.

The complaint also cited a similar action plan provided by Murray Energy to Vice President Mike Pence in March 2017 that listed the elimination of the Obama-era Clean Power Plan as its top priority. Murray Energy was also one of the primary litigants in a legal challenge to the Clean Power Plan, which aimed to meet the U.S.'s CO2 emissions reduction goals under the Paris Agreement on climate change by requiring states to implement measures that would have forced dozens of coal plants to retire.

"Given his prominent lobbying role, which continued through September 2017, and the extraordinary efforts and priority Murray Energy placed on eliminating the [Clean Power Plan], it is likely that Mr. Wheeler was involved in lobbying efforts to eliminate the [plan], possibly including the development" of the plan delivered to Pence, the complaint alleged.

Wheeler denied that charge in an August 2018 interview with The New York Times, telling the paper at the time that he stepped away from lobbying activities involving the EPA following the 2016 presidential election. "I did not reach out to the Pruitt EPA at all. I did not lobby them," he told the Times. "That was purposeful."

In August 2018, Wheeler signed the EPA's Affordable Clean Energy, or ACE, rule the Trump administration's proposed replacement for the Clean Power Plan, which incentivizes efficiency upgrades at coal-fired power plants. "Because the ACE rule is, according to EPA, 'a proposal to replace to replace [Clean Power Plan] with revised emissions guidelines,' it is the same particular matter on which Mr. Wheeler likely lobbied or in the same specific issue area as" the Clean Power Plan, the complaint alleged.

EPA spokeswoman Molly Block on Jan. 15 called the complaint "baseless" and "wrong," adding that Wheeler works closely with career EPA ethics officials and follows their guidance. "This is nothing more than a last second political stunt by a group to try to attack President Trump's nominee hours before his confirmation hearing and should be recognized as such," she said in an email.

CREW's complaint follows an earlier complaint filed by the watchdog group Public Citizen, which wrote to the Office of the White House Counsel in March 2018 alleging that Wheeler "appears to be working on the same specific issue areas he had lobbied on within the last two years."

It is unlikely the EPA OIG will act on CREW's complaint until after the prolonged partial government shutdown which includes the EPA comes to an end.