Biden halts oil, gas leases amid legal fight on climate cost

The Biden administration is delaying decisions on new oil and gas drilling on federal land and other energy-related actions after a federal court blocked the way officials were calculating the real-world costs of climate change.

The administration said in a legal filing that a Feb. 11 ruling by a Louisiana federal judge will affect dozens of rules by at least four federal agencies. Among the immediate effects is an indefinite delay in planned oil and gas lease sales on public lands in a half-dozen states in the West, including Wyoming, Montana and Utah.

The ruling also will delay plans to restrict methane waste emissions from natural gas drilling on public lands and a court-ordered plan to develop energy conservation standards for manufactured housing, the administration said. The ruling also will delay a $2.3 billion federal grant program for transit projects, officials said.

A brief filed by the Justice Department late Saturday “confirmed that certain activities associated with fossil fuel leasing and permitting programs are impacted by the February 11, 2022, injunction,” the Interior Department said in a statement. “Delays are expected in permitting and leasing for the oil and gas programs.”

Interior continues to move forward with reforms to oil and gas programs onshore and offshore and “is committed to ensuring its programs account for climate impacts,” said spokeswoman Melissa Schwartz.

The delays follow a ruling by U.S. District Judge James Cain of the Western District of Louisiana, who blocked federal agencies from using an estimate known as the “social cost of carbon” to assess pollution from carbon emissions by energy production and other industrial sources. The decision blocked the Biden administration from using a higher estimate for the damage that each additional ton of greenhouse gas pollution causes society.

President Joe Biden on his first day in office restored the climate cost estimate to about $51 per ton of carbon dioxide emissions, after President Donald Trump had reduced the figure to $7 or less per ton. Trump’s estimate included only damages felt in the U.S. versus the global harm previously used by President Barack Obama.

The damage figure uses economic models to capture impacts from rising sea levels, recurring droughts and other consequences of climate change and helps shape rules for oil and gas drilling, automobiles and other industries. Using a higher cost estimate would help justify reductions in planet-warming emissions by making the benefits more likely to outweigh the expenses of complying with new rules.