June 30, 2022

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Decided on June 30, 2022

West Virginia, et al. vs. EPA, et al.no. 20-1530;

North American Coal Corp. vs. EPA, et al.no. 20-1531;

Westmoreland Mining Holdings LLC v. EPA, et al., No. 20-1778; and

North Dakota v. EPA, et al.No. 20-1780

Today, the Supreme Court ruled 6-3 that Congress failed to delegate broad authority to the EPA to substantially restructure the US energy market.

Background: Under the Clean Air Act, the Environmental Protection Agency has the power to regulate pollutant emissions from power plants by mandating the “best system” to reduce emissions. In 2015, the EPA released the Clean Power Plan, which required existing coal and gas-fired power plants to reduce their electricity production or offset their production by subsidizing the production of natural gas, wind or solar power. The Clean Power Plan, however, was suspended in subsequent litigation and never took effect. In 2019, the EPA released a new rule – the Affordable Clean Power Rule – which repealed and replaced the Clean Power Plan. The EPA found that the Clean Power Plan exceeded its statutory authority.

After the 2019 rule was challenged in court, the DC Circuit overturned the rule and ruled the EPA erred in finding it lacked the power to impose the energy plan own. The EPA then planned to promulgate a new rule.

Publish: If the Clean Air Act empowers the EPA to transform the power generation sector.

Court attire:

No. Under the Clean Air Act, Congress did not delegate broad powers to the EPA to restructure the energy industry by requiring existing power plants to transition to different forms of power generation.

“[O]Our precedent advises skepticism of the EPA’s assertion that [the Clean Air Act] allows it to design carbon emission caps based on a generational change approach.

Chief Justice Roberts, writing for the Court

What this means:

• The Court found that in enacting the Clean Air Act, Congress did not authorize the EPA to fundamentally restructure the U.S. electricity market by requiring a shift from coal and gas-fired power plants to other types of electricity production.
• For the third time in a year, the Court reaffirmed the principle that agency action of great economic and political significance requires clear delegation from Congress. Thus, although this decision marks the first time that the Court has expressly referred to the “major issues doctrine” in a majority opinion, the application of this doctrine is not new. The Court’s repeated application of the major issues doctrine signals an ongoing commitment by the Court to limit the regulation of executive agencies on particularly important issues to circumstances where Congress has clearly delegated such regulatory authority to the agency. The Court’s robust application of this doctrine will have potentially important applications for a wide range of actions by agencies that assert broad power over important economic and political issues.
• In employing the major issues doctrine to resolve this case, the Court did not defer to the EPA’s interpretation of the Clean Air Act. This result stems from the nature of the major issues doctrine, which requires agencies to identify a clear statement of congressional authorization to justify extraordinary and far-reaching agency regulatory initiatives. In such cases, ambiguity in a statutory assignment of authority is fatal to agency regulatory efforts, leaving no room for deference.

The opinion of the Court is available here.

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