EPA let industry dictate policy on mercury, some staffers contend

By Tom Hamburger and Alan C. Miller
Los Angeles Times

	EPA Administrator Michael Leavitt is now calling for more analysis of the proposed rule regulating mercury emissions.
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The EPA staff members say they were told not to undertake the normal scientific and economic studies called for under a standing executive order. At the same time, the proposal to regulate mercury emissions from coal-burning power plants was written using key language provided by utility lobbyists.

The Bush administration has said the proposed rule would cut mercury emissions by 70 percent in 15 years. But critics say it would delay reductions in mercury levels for decades at a risk to public health, while saving the power and coal industries billions of dollars.

Studies designed to address such questions are the ones that were not conducted.

EPA veterans say they cannot recall another instance when the agency's technical experts were cut out of developing a major regulatory proposal.

The administration chose a process "that would support the conclusion they wanted to reach," said John Paul, a Republican environmental regulator from Ohio who co-chaired the EPA-appointed advisory panel and who says that its 21 months of work on mercury was ignored.

"There is a politicization of the work of the agency that I have not seen before," said Bruce Buckheit, who retired in December as director of the EPA's Air Enforcement Division, partly because he thought enforcement was stymied. "A political agenda is driving the agency's output, rather than analysis and science."

Russell Train, a Republican who headed the EPA during the Nixon and Ford administrations, said: "I think it is outrageous. The agency has strayed from its mission in the past three years."

Analysis now sought

Buffeted by complaints about the mercury proposal from both within and outside the agency, EPA Administrator Michael Leavitt in recent days has called for additional analysis. EPA staff members say they have been asked to suggest possible comparative studies for the agency to run, much like the analyses they say they were ordered not to conduct last year.

"The process is not complete, nor is the analysis," Leavitt said Monday. "I want it done well, and I want it done right, and I want it done in a way that will maximize the level of (mercury) reductions."
 
Leavitt portrayed the new period of inquiry as part of the "normal process" of rule-making, noting the agency had so far filed only a provisional rule. But veteran regulators say it is unusual to propose a rule first and do extensive comparative studies later, unless new information emerges.

Leavitt said he could not address what happened at the agency before he arrived in November but that he has had "no pressure to do anything other than the right thing from the White House."

Christie Todd Whitman was the EPA administrator when the career employees say they were told not to conduct the analysis. She left the agency in June, six months before the proposed rule was announced.

"I did not know that we were cutting a process short or shortchanging the analysis," Whitman said Monday. Had she heard such allegations, she said, she would have intervened.

What went on

Five current career employees — all speaking on condition they not be named for fear of retribution — and several former officials provided a behind-the-scenes account of the EPA's decision-making in the mercury case.

Mercury's threat to the human nervous system has been known since at least the 19th century, and a cascade of studies in recent years has cast it as an escalating health danger.

Today, the use of mercury in U.S. manufacturing is tightly restricted. But there has been no strict limit on mercury released into the atmosphere from the nation's 1,100 coal-fired power plants, the largest single source in the United States.

Mercury occurs naturally in fossil fuels such as coal and is released into the atmosphere when those fuels are burned. When mercury particles and gases drop into water, some turn into a more toxic form known as methyl mercury, which enters the aquatic food chain. People are exposed to mercury chiefly by eating fish.

In 2000, a National Research Council study commissioned by Congress estimated that 60,000 children may be born in the United States annually with neurological problems that could lead to poor school performance because they were exposed to mercury before birth.

In the past few months there has been a flurry of other disturbing reports, most focusing on the threat to fetuses from mothers eating fish with elevated levels of mercury. In December, the Food and Drug Administration warned all women of child-bearing age to limit their intake of tuna and some other fish because of concern about mercury.

Economic warnings

Coal and utility executives don't dispute the dangers of mercury, but question how much of the threat comes from power plants. And they warn that overly aggressive regulation of coal-fired power plants could damage the coal and power industries and the economy and endanger already thin supplies of electricity.

In its final days, the Clinton administration determined mercury to be a toxic substance and thus subject to strict regulation under the Clean Air Act. The administration's decision required that the EPA propose standards for power-plant emissions by the end of 2003. As part of that process, the EPA selected a 21-member federal advisory panel in 2001 to make recommendations to the agency.

Mercury was on the agenda at a staff meeting last spring at EPA headquarters presided over by Jeffrey Holmstead, a lawyer who represented industry interests on air-pollution issues before Bush appointed him to run the EPA's Office of Air and Radiation. Several of the staff members said they expected to discuss plans to carry out comparative studies of proposals to reduce mercury emissions. The studies, which had been requested by the federal advisory panel, were designed to examine the impact of mercury regulation on energy markets, electricity prices and public health.

But William Wehrum, a senior adviser to Holmstead who also represented industry clients before joining the Bush administration, told the dozen or so employees that comparative studies would be postponed indefinitely.

"I was floored," one participant said. "We pointed out that the studies were required ... that the data runs were promised to a federal advisory committee."

Holmstead did not respond to the expressions of concern, participants said. "There was an awkward silence," one recalled.

After the meeting, two staff members said, Holmstead informed them the studies would not be conducted partly because of "White House concern."

Holmstead and Wehrum declined repeated requests for comment.

'We were cut off'

Paul, the co-chairman of the advisory committee, which was made up of regulators, environmentalists and industry representatives, says his panel was promised the comparative data last March, but that its next meeting was canceled by the EPA and that the group never met again.

"We were cut off without any warning or explanation," he said.

Even as career staff members and the EPA's advisory panel thought their contributions to the mercury proposal were being restricted, utility-industry lobbyists were given extraordinarily direct input.

When the Bush administration took office in 2001, slowing mercury regulation was among the priorities for the coal and power industries. The administration has responded to three other key industry goals: It ended U.S. participation in the Kyoto process to reduce global warming, accelerated the permitting process for coal mines, and relaxed regulations that required the power industry to install pollution controls when renovating plants.

The proposed mercury rule, published in the Federal Register in December, contains numerous paragraphs of verbatim language supplied by two separate industry advocates.

Several complete paragraphs were lifted from three memos provided by Latham & Watkins, a national law firm whose clients include large coal-fired utility companies. Both Holmstead and Wehrum are former Latham & Watkins attorneys.

Industry wording

The proposal also includes exact language provided by West Associates, a research and advocacy group representing 20 power and transmission companies in the western United States.

The West language suggests a standard for determining likely mercury emissions at power plants. That standard — largely incorporated by the EPA — is enormously beneficial to industry, said S. William Becker, executive director of the State and Territorial Air Pollution Program Administrators, a group that represents state and local regulators in Washington, D.C.

Under the proposal, the government would set a national annual cap on emissions but then permit individual companies to choose whether to reduce their own emissions or buy credits from other companies that do. This is designed to provide an incentive to cut emissions nationwide, without limiting them at each individual facility.

Such an approach was widely hailed in the 1990s for reducing power-plant emissions that produce acid rain, but critics say it would be ill-advised for a toxin such as mercury.

Some scientists say that mercury, which is heavier than acid-rain-producing sulfur dioxide and nitrogen oxide, will remain close to the point of emission, creating hot spots of potentially high levels of mercury contamination near power plants. Power plants in communities with high levels of mercury could opt to buy credits rather than spend to make reductions.

The EPA's own Children's Health Protection Advisory Committee wrote Jan. 26 that "the cap and trade program, as proposed, may not address existing hot spots and may create new local hot spots for mercury."

Overall, the committee said, the Bush proposal "does not sufficiently protect our nation's children."

Proposed reductions

Today, coal-fired power plants pump out about 48 tons of mercury annually. The Clinton administration order under the Clean Air Act would have mandated reducing the amount of mercury produced by coal-fired power plants by as much as 90 percent to about five tons annually by 2008.

The Bush Clear Skies plan, as modified on Capitol Hill, calls for a national cap of 34 tons in 2010, a level that wouldn't require any extra spending by the industry because it would automatically be reached if utilities add scrubbers and other equipment to comply with Clear Skies rules regulating nitrogen-oxide and sulfur-dioxide emissions.

Opponents of the Bush plan contend that setting a lower cap in the near future would encourage innovation by assuring a market for the new equipment. But utility-industry officials argue that forcing rapid adoption of that technology would be so expensive that it would lead electric generators to shift from coal to natural gas.

"The result would be increased electricity prices and higher costs for home heating, food and a host of consumer and industrial products," said Scott Segal, director of a coal utility trade association.

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