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BREAKING: Supreme Court rules against EPA's authority to limit emissions by remaking energy sector

The EPA was effectively regulating coal businesses to scale back until they were no longer in the business of providing energy.

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Libby Emmons Brooklyn NY
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The Supreme Court on Thursday issued a ruling in the case of West Virginia v. Environmental Protection Agency. The 6-3 ruling sides with West Virginia, which sought to limit the Clean Air Act.

At issue were the EPA's plans to use regulation to "reduce carbon pollution mostly by moving production to cleaner sources." Once the EPA determined this course of action, they began to limit allowable emissions from fossil fuel production. They enacted goals that they viewed as a "'reasonable' amount of shift which it based on modeling how much more electricity both natural gas and renewable sources could supply without causing undue cost increases or reducing the overall power supply."

The Clean Air Act authorized the EPA to "regulate power plans by setting a 'standard of performance' for their emission of certain pollutants into the air."

Chief Justice Roberts wrote in his opinion: "Since passage of the Act 50 years ago, EPA has exercised this authority by setting performance standards based on measures that would reduce pollution by causing plants to operate more cleanly. In 2015, however, EPA issued a new rule concluding that the 'best system of emission reduction' for existing coal-fired power plants included a requirement that such facilities reduce their own production of electricity, or subsidize increased generation by natural gas, wind, or solar sources."

This meant that the EPA was effectively regulating coal businesses to wind down toward the end goal of no longer being in the business of providing energy. Roberts asked the question as to "whether this broader conception of EPA’s authority is within the power granted to it by the Clean Air Act."

In the ruling, Roberts digs into the regulatory framework of the Clean Air Act and the authority of the EPA to impose its fossil fuel reduction plans. "The Agency identified three ways in which a regulated plant operator could implement a shift in generation to cleaner sources," Roberts wrote. "First, an operator could simply reduce the regulated plant’s own production of electricity. Second, it could build a new natural gas plant, wind farm, or solar installation, or invest in someone else’s existing facility and then increase generation there. Finally, operators could purchase emission allowances or credits as part of a cap-and-trade regime."

The goal here, per the EPA, was to "implement a sector-wide shift in electricity production from coal to natural gas and renewables."

"The point, after all, was to compel the transfer of power generating capacity from existing sources to wind and solar," Roberts wrote.

"The EPA's own modeling concluded that the rule would entail billions of dollars in compliance costs (to be paid in the form of higher energy prices), require the retirement of dozens of coal-fired plants, and eliminate tens of thousands of jobs across various sectors," Roberts stated. The plans were immediately challenged in 2019 by states and energy companies.

The EPA essentially attempted to wield not just power over emissions, but power over the nature of the energy industry in the US, and to determine what sources of energy could be used and which should be phased out, based on their own views regarding climate change and greenhouse gases. But the Court found that the EPA overstepped its authority by wielding "unprecedented power over American industry." The Court stated that "There is little reason to think Congress assigned such decisions to the Agency."

"The dissent," Roberts writes, "contends that there is nothing surprising about EPA dictating the optimal mix of energy sources nationwide, since that sort of mandate will reduce air pollution from power plants, which is EPA’s bread and butter. Post, at 20–22. But that does not follow. Forbidding evictions may slow the spread of disease, but the CDC’s ordering such a measure certainly 'raise[s] an eyebrow.' Post, at 18. We would not expect the Department of Homeland Security to make trade or foreign policy even though doing so could decrease illegal immigration. And no one would consider generation shifting a 'tool' in OSHA’s 'toolbox,' post, at 21, even though reducing generation at coal plants would reduce workplace illness and injury from coal dust."

The opinion states that the EPA does not have this broad authority under the Clean Air Act, and that this power has not been bestowed by Congress.

"Capping carbon dioxide emissions at a level that will force a nationwide transition away from the use of coal to generate electricity may be a sensible 'solution to the crisis of the day,'" Roberts writes, citing New York v. United States. "But it is not plausible that Congress gave EPA the authority to adopt on its own such a regulatory scheme in Section 111(d). A decision of such magnitude and consequence rests with Congress itself, or an agency acting pursuant to a clear delegation from that representative body."

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