Supreme Court deals Biden climate agenda serious blow with EPA decision

The Supreme Court dealt a significant blow to the Biden administration’s climate change agenda, ruling Thursday that the Environmental Protection Agency cannot pass sweeping regulations that could overhaul entire industries without additional congressional approval.

The 6-3 decision limits how far the executive branch can go in forcing new environmental regulations on its own.

"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,’ But it is not plausible that Congress gave EPA the authority to adopt on its own such a regulatory scheme in Section 111(d)," Chief Justice John Roberts said in the Court's opinion, referencing Section 111 of the Clean Air Act. "A decision of such magnitude and consequence rests with Congress itself, or an agency acting pursuant to a clear delegation from that representative body."

The case stemmed from the Obama administration’s 2015 Clean Power Plan which aimed to reduce carbon emissions at power plants by pushing a shift from coal, to natural gas, and ultimately to wind and solar energy. The plan was put on hold by the Supreme Court in 2016, and then repealed by the Trump administration and replaced by the less extreme Affordable Clean Energy (ACE) Rule. 

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After President Biden took office, the ACE Rule became the subject of litigation that led to the D.C. Circuit Court of Appeals vacating that rule as well as the repeal of the Clean Power Plan. The Biden EPA, however, has stated that it will not reinstate the Clean Power Plan, opting instead to develop and implement its own plan.

The question of how much power the EPA has was based on a provision in Section 111 of the Clean Air Act, which grants the EPA power to set "standards of performance" for existing sources of air pollutants as long as they take into account cost, energy requirements, and non-air health and environmental impacts. 

The Trump EPA, in repealing the Clean Power Plan, took the position that Section 111 only let them determine measures to be implemented at the physical power plants themselves (an "inside-the-fence-line" restriction) and not broadly-applied measures for entire industries.

Similarly, West Virginia and other states claimed that Section 111 does not allow the EPA to go so far as to make rules that would completely reshape American electrical grids or force industries to eliminate carbon emissions altogether. 

West Virginia’s argument is based on the "major questions doctrine," which says that even though federal agencies generally have broad rule-making power as delegated by Congress through the statutes that create them, when it comes to issues of major economic and political significance to the country those statutes need to have clear language to support the agency’s action. When the Trump EPA repealed the plan in 2019. it cited the major questions doctrine.

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The Biden EPA claimed that the major questions doctrine did not apply in this case, arguing that there was no issue of such great significance. During oral arguments, Solicitor General Elizabeth Prelogar asserted that there cannot be a major question because there is no current rule in place. 

"Under our precedents, this is a major questions case," the Supreme Court said in its majority opinion," stating that the EPA is arguing  that the existing law "empowers it to substantially restructure the American energy market[.]" The Court noted that the EPA derived this "newfound power" from "the vague language of an ‘ancillary provision’" that "had rarely been used in the preceding decades."

The Court stated that the EPA's new interpretation of the law "was not only unprecedented; it also effected a ‘fundamental revision of the statute[.]’"

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Given the nature of this interpretation, the Court said it was skeptical that this is what the law truly intended. 

"To overcome that skepticism, the Government must—under the major questions doctrine—point to ‘clear congressional authorization’ to regulate in that manner," the Court said, ultimately determining that the EPA failed to find such authorization.

Justice Elena Kagan dissented, along with Justices Stephen Breyer and Sonia Sotomayor. Kagan described the seriousness of climate change and the risks posed if significant change is not made when it comes to carbon emissions.

"Congress charged EPA with addressing those potentially catastrophic harms, including through regulation of fossil fuel-fired power plants," Kagan wrote.

The dissent argued that Section 111 indeed authorizes the EPA to make broad changes because it allows the EPA to choose the "best system of emission reduction." 

"The ‘best system’ full stop — no ifs, ands, or buts of any kind relevant here," Kagan said.

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Kagan also echoed an argument made during oral arguments by U.S. Solicitor General Elizabeth Prelogar, that there was no reason for the Court to even hear this case given that the Clean Power Plan no longer exists, and the Biden administration is working on a new plan.

"Yet this Court determined to pronounce on the legality of the old rule anyway," Kagan said, adding that "because no one is now subject to the Clean Power Plan’s terms, there was no reason to reach out to decide this case." Kagan said that the majority opinion "is really an advisory opinion on the proper scope of the new rule EPA is considering," and that the Court "could not wait — even to see what the new rule says — to constrain EPA's efforts to address climate change."