How Industry Won the Battle of Pollution Control at E.P.A.

- Just six weeks into the Bush administration, Haley Barbour, a former Republican party chairman who was a lobbyist for electric power companies, sent a memorandum to Vice President Dick Cheney laying down a challenge.

"The question is whether environmental policy still prevails over energy policy with Bush-Cheney, as it did with Clinton-Gore," Mr. Barbour wrote, and called for measures to show that environmental concerns would no longer "trump good energy policy."

Mr. Barbour's memo was an opening shot in a two-year fight inside the Bush administration for dominance between environmental protection and energy production on clean air policy. One camp included officials, like Mr. Cheney, who came from the energy industry. In another were enforcers of environmental policy, led by Christie Whitman, a former Republican governor of New Jersey.

The battle engaged some of the nation's largest power companies, which were also among the largest donors to President Bush and other Republicans. They were represented by Mr. Barbour and another influential lobbyist, Marc Racicot, who also would later become chairman of the Republican National Committee.

In an administration that puts a premium on keeping its internal disputes private, this struggle went on well out of the public's view. But interviews and documents trace the decisions in which the Bush administration changed the nation's approach to environmental controls, ultimately shifting the balance to the side of energy policy. Senior officials at the Environmental Protection Agency, including Mrs. Whitman, became isolated, former aides said, and several resigned.

Thirty years after the first Earth Day, the incoming administration was still confronting power-plant smokestacks spewing fumes. The policy questions were arcane, involving strategies to control polluting particles. At stake, though, were environmental risks to human health and the nation's ability to produce cheap energy, as well as decisions about how the most polluting industries would be monitored for decades to come.

For operators of some coal-fired plants, the stakes were more tangible. Dozens of plants were facing lawsuits over air pollution brought by the Clinton administration and several northeastern states — including New Jersey under Mrs. Whitman before she became head of the E.P.A. The industry, fearing billions of dollars in new costs, set about to undo the suits.

One of the most important decisions was Mr. Bush's reversal of a campaign promise to regulate emissions of carbon dioxide, a gas that many scientists say contributes to global warming. The administration also has proposed looser standards for emissions of mercury — a highly toxic pollutant — than President Bill Clinton had sought. The most protracted fight concerned the administration's decision to issue new rules that substantially reduced the requirements for utilities to build pollution controls when modernizing their plants. The final policy shift may ultimately help the coal-plant operators shed the lawsuits.

The struggle within the administration, in skirmishes between Cabinet officers and volleys of memorandums, showed how the White House has transformed domestic policy through regulatory revision, rather than more contentious congressional debate.

Administration officials say the changes were needed to raise energy production and lift the burden of cumbersome and costly regulations on industry. They said that the approach will continue the trend of declining emissions and reduce some of the most harmful pollutants by about half in the next decade — cuts as deep if not deeper than the old measures would bring.

"It's not about whether air quality will get better," said James L. Connaughton, chairman of the White House Council on Environmental Quality. "It will, and it must. The question is what path you take to get there."

Critics on Capitol Hill and environmental groups say the policies will slow the cleaning of the air and undercut Congress's authority, while catering to companies that are big contributors to Mr. Bush's campaigns.