Top Court Takes Up Climate Challenge in Pre-Summit Jolt to Biden

(Bloomberg) -- The U.S. Supreme Court will consider limiting the Environmental Protection Agency’s authority to curb greenhouse gases from power plants, agreeing to hear appeals from coal-mining companies and Republican-led states.

The appeals seek to prevent President Joe Biden’s administration from imposing the type of sweeping emissions rules the EPA tried to put in place when fellow Democrat Barack Obama was president. The Supreme Court put Obama’s Clean Power Plan on hold in February 2016, and it never took effect.

The conservative-controlled court will review a federal appeals court decision that critics say gave the EPA sweeping authority to reshape key sectors of the U.S. economy, going well beyond what Congress envisioned when it enacted the Clean Air Act.

The appeals court ruling would have “massive consequences,” argued a West Virginia-led group of 18 states and one governor. It would let the agency “set standards on a regional or even national level, forcing dramatic changes in how and where electricity is produced, as well as transforming any other sector of the economy where stationary sources emit greenhouse gases.”

The decision to hear the case comes as Biden is set to attend an international climate conference in Glasgow, Scotland, that begins Sunday. The court’s intervention could be a setback to the president’s pledge to reduce U.S. emissions in half by the end of decade and his goal of a carbon-free electric grid by 2035.

“It’s a huge deal -- and a big surprise,” said Jeff Holmstead, a former EPA assistant administrator and now a partner at Bracewell LLP. The court’s decision to get involved will “almost certainly prevent the Biden administration from moving forward with a new rule to regulate carbon emissions from the power sector. They’ll have to wait to see what the Supreme Court says.” 

The Biden administration urged the Supreme Court not to get involved, saying the issues in the case had been overtaken by events because the EPA doesn’t plan to revive the Clean Power Plan. 

“This court’s review therefore should await the completion of EPA’s new rulemaking, when any challenge to the new rule will take a more concrete shape,” the administration told the justices.

Speaking in an interview with Joe Mathieu on Bloomberg Radio, EPA Administrator Michael Regan said the administration is “very optimistic that EPA does have the appropriate statutory authority to reduce CO2 emissions from coal plants.” 

He added, “so we will be taking a close look at the Supreme Court’s verdict, but we are not deterred from our mission.”

Ruling Next Year

The appeals court decision also set aside an industry-friendly climate rule issued under President Donald Trump. That aspect of the ruling isn’t at issue in the Supreme Court case.

Under their normal schedule practices, the justices will hear arguments early next year and rule by late June.

The appeals center on a Clean Air Act provision that requires the EPA to identify the “best system of emission reduction” for existing pollution sources and then tasks states to come up with implementation plans. Under Obama’s Clean Power Plan, states were encouraged to shift electricity generation from higher-emitting sources, such as coal, and toward lower-emitting options, such as renewable power.

“Our nation’s clean air laws require EPA to protect the American people from the dangerous air pollution that is devastating communities across the country,” said Ben Levitan, senior attorney at Environmental Defense Fund, which is a party to the case. EDF “will firmly defend EPA’s authority and responsibility to protect American families from the clear and present danger of climate pollution emitted by power plants.”

The challengers include a Nacco Industries Inc. unit and Westmoreland Mining Holdings.

The cases are West Virginia v. EPA, 20-1530; North American Coal Co. v. EPA, 20-1531; Westmoreland Mining Holdings v. EPA, 20-1778; and North Dakota v. EPA, 20-1780.

(Updates with EPA administrator reaction in eighth and ninth paragraphs.)

More stories like this are available on bloomberg.com

©2021 Bloomberg L.P.