The Biden White House has responded to an adverse ruling from a Louisiana federal court regarding how it calculates “social costs” involved with energy production by announcing that it is either suspending or delaying new federal oil and gas leasing.
On February 11, Judge James Cain of the US District Court for the Western District of Louisiana temporarily blocked the administration’s use of an accounting technique for valuing the social costs of greenhouse gas emissions when issuing environmental regulations. Cain is an appointee of President Donald Trump.
Administrative agencies were first introduced to the social cost calculation during the Obama Administration. The accounting methods adopted during the Trump Administration placed much less weight on climate damage calculations.
Cain’s order blocked the Departments of Transportation and the Interior, the EPA, and other agencies from relying on administrative findings by a White House “Interagency Working Group.” Cain found that Biden’s executive order creating the working group exceeded and contradicted the intent of Congress in directing the leasing of federal land for energy production.
In response, the White House announced this weekend that it is ordering a blanket suspension of all new energy leases. Biden has also directed the Justice Department to appeal the decision and ask Judge Cain to stay the injunction while the case is being appealed. The Administration’s filings said that every Administration had imposed a costs and benefits analysis to major decisions since President Nixon. The DOJ also said that Cain’s order brings the actions of the last three administrations into question.
The filings also argue to Cain that his order is the cause of the delay or suspension of oil and gas leasing while administrative agencies assess how to proceed.
The termination of all federal energy leases comes as the nation struggles with surging inflation and supply chain issues. Although America achieved essential energy independence under President Trump, consumers now face uncertainty about the prospects of energy imports, especially as Russia threatens oil and gas supplies throughout Europe and the West with its aggressive actions toward Ukraine.