The American Public Power Association recently provided a detailed overview of the potential impacts on federal agencies resulting from Donald Trump’s reelection as President of the U.S., as well as the Republican Party’s control of both chambers of Congress.
By Nov. 13, the Republicans had picked up enough seats to retain control of the House.
The 119th Congress
The 119th Congress will be sworn in on January 3, 2025. With Republicans maintaining their majority in the House, they will likely pursue at least one “reconciliation bill” in 2025.
Reconciliation is a special process that allows for expedited consideration of certain tax, spending, and debt limit legislation.
In the Senate, reconciliation bills require only a simple majority vote for passage and are not subject to the 60-vote filibuster threshold.
“Regardless of which party controls the House, tax issues will be at the top of the agenda in the next Congress,” APPA said prior to confirmation that Republicans retained control of the House.
Republicans have said that they would use a reconciliation bill to extend tax cuts included in the 2017 Tax Cuts and Jobs Act, which are set to expire at the end of 2025, and possibly change provisions of the Inflation Reduction Act (IRA).
While they are unlikely to try to repeal the IRA outright, Republican members and staff have said every provision will be under review, including elective payment of energy tax credits.
APPA has spent the last year laying the groundwork to protect and enhance elective pay and believes it has a good foundation of support, but continued advocacy here will be a top priority along with preserving tax-exempt financing and reinstating the ability to issue tax-exempt advance refunding bonds.
APPA also expects that there will be efforts to limit tax-exempt bonds to offset the costs of a new tax package. APPA has already joined with other stakeholders to educate lawmakers on the issue and will do so with new members of Congress and their staff.
Other issues of interest that may be addressed in Congress in 2025 include permitting reform (if a bill doesn’t pass this year) and wildfire legislation, APPA reported.
Federal Energy Regulatory Commission
Upon taking office, Trump will appoint a new chairman to FERC. Trump is expected to appoint either Commissioner Mark Christie or Commissioner Lindsay See.
The current chairman, Willie Phillips, can remain at FERC as a regular commissioner until his term expires in June 2026.
Historically, however, most FERC chairmen resign at the beginning of a new administration when their party is no longer in the White House.
If Phillips resigns, the President will have the opportunity to appoint a Republican commissioner to fill that seat.
With regard to electricity policy, the issues FERC addresses in 2025 will not change materially, APPA reported.
The industry’s challenges are well-known: growing load, generation retirements, inadequate replacement capacity, extreme weather, security threats, and affordability. FERC must take action to address those challenges, regardless of who is the chair.
But a new Republican chair will control the rulemaking agenda, so they will prioritize which issues to address in early 2025.
Phillips had stated an intention to work on interregional transmission planning, but it is less likely that would be a priority for either a Chairman See or Chairman Christie. Both Commissioners See and Christie have expressed interest in ensuring FERC’s policymaking remains within its narrow statutory boundaries, and empowering states to have a bigger say.
Another area to watch will be FERC’s senior staff. Those staff play an important role in setting—and executing—FERC’s policy agenda. Senior staff changes, particularly if they are replaced with political appointees, could have a material impact on the approach FERC takes to solving problems.
Environmental Issues
APPA expects a second Trump administration to implement its environmental deregulatory agenda, rolling back environmental requirements finalized under the Biden administration.
“On day one, the new administration will issue executive orders commensurate with policy priorities to cut costly and burdensome regulations and pause or reverse key Biden administration efforts and reposition the Environmental Protection Agency and other agencies to evaluate further deregulatory actions, including potentially pausing enforcement actions,” APPA said.
Immediately upon taking office, the new administration will issue directives withdrawing pending regulations that have not been made public, including final rules awaiting publication or deferring the effective dates of recently published regulations. We expect the incoming administration to utilize the Congressional Review Act, as it did in 2016, to repeal administrative rules.
The final power sector rules that will be targeted for repeal, replacement, or reconsideration include the greenhouse gas (GHG) emission requirements for new gas-fired and existing coal-fired electric generation, the Federal Implementation Plan for the 2015 Ozone National Ambient Air Quality Standards (NAAQS), aka Good Neighbor Plan, the Mercury and Air Toxic Standards Residual Risk and Technology Review, the Steam Electric Effluent Limitation Guidelines, Legacy Coal Combustion Residuals Rule, Particulate Matter NAAQS, the Endangered Species Act Rule amendments, Clean Water Act Water Quality Certification Rule, and amendments to the National Environmental Policy Act.
Many of these rules were finalized before the August 1, 2024, CRA deadline and face legal challenges.
Trump will direct the Department of Justice to stay federal litigation, particularly challenges to final rulemaking, to allow time to develop new administration positions.
A stay in litigation would allow the Trump team to potentially support agency decisions, attempt to rescind or stay implementation of the regulation using the Administrative Procedures Act, and/or replace the rule with a new agency position.
APPA also expects the new administration to slow roll efforts to regulate GHG emissions and air toxics from existing gas plants and criteria pollutants from new gas plants.
Earlier in the year, EPA administrator Michael Regan announced plans to address emissions from stationary combustion turbines in a “comprehensive” manner and opened a nonregulatory docket seeking comments on how to regulate combustion turbines (CTs).
“It remains to be seen if EPA will propose a GHG rule for existing CTs in the waning days of the current administration to ensure the technical input it received is officially part of the rulemaking record,” APPA said.
“The new EPA leadership will greatly influence the priority and pace of any deregulatory actions; therefore, once the senior leadership is in place, we can expect the deregulatory process to unfold quickly,” it said.
