We previously reported on the Obama administration’s release of the final version of the Clean Power Plan (“Plan”), a set of Environmental Protection Agency (EPA) regulations designed to significantly reduce greenhouse gas emissions from electric power generating plants. Under the Plan, states are responsible for developing individualized compliance policies by September 2016, with the ultimate goal of a 32% decrease from 2005 levels in carbon emissions from existing power plants by 2030.
While the U.S. Court of Appeals for the D.C. Circuit is set to hear the dispute regarding the Clean Power Plan in June 2016, five separate challenges, including more than 25 states and numerous industry groups petitioned the Supreme Court for an immediate stay of implementation pending the D.C. Circuit’s decision. The parties opposing the Plan argued that implementation would cause irreparable harm including imminent closures of a vast number of existing coal-fired power plants. The EPA responded that, among other reasons, the regulations under the Clean Power Plan, in addition to bringing about critical reductions in carbon emissions, build off of existing regulations and require no action on the part of regulated entities until 2022.
On February 9, 2016, in a five to four decision divided along ideological lines, the U.S. Supreme Court granted the stay ordering the EPA to halt implementation of the Clean Power Plan. Never before has the Supreme Court issued an order preventing an agency from implementing and enforcing regulations prior to any judicial review by a lower court. The White House released a statement stating that it disagrees with the Court’s issuance of the stay, reasoning that the Clean Air Act and the Clean Power Plan are based on a strong legal foundation and provides states time and flexibility to come into compliance.
In June, the D.C. Circuit will hear oral arguments regarding the underlying dispute, to wit, the EPA’s authority under the Clean Air Act to regulate greenhouse gas emissions from existing power plants. The EPA relies on section 111(d) of the Clean Air Act, which authorizes the Agency to regulate air pollution from stationary sources, subject to a number of restrictions. Most notably, the parties disagree on the scope of one such restriction, which precludes the Agency from regulating certain pollutants already regulated under section 112 of the Clean Air Act.
Notwithstanding the outcome in the D.C. Circuit, the Supreme Court will likely be asked to review the merits of the Clean Power Plan in the future. While the five to four decision granting the stay may reflect the majority’s skepticism or doubt regarding EPA’s authority to implement the regulations, the death of Supreme Court Justice Antonin Scalia presents the possibility that a new majority may uphold the regulations.