In an unprecedented action, the U.S. Supreme Court has stayed implementation of the Obama administration's Clean Power Plan regulations. The case is now under review by the U.S. Court of Appeals for the D.C. Circuit, with a hearing set for June 2.
Background
The administration's proposal to regulate coal-fired
electricity generating power plants is commonly referred to as the
Clean Power Plan (CPP). It seeks to achieve a 32 percent reduction
by 2030 through a series of measures placing greater reliance on
natural-gas-fired generators and renewables, like wind and
solar.
CPP takes a systems-based rather than a source-based approach. In
determining the potential for carbon reductions, it takes into
account not just the power plants themselves, but the entire
electricity system, all the way down to consumers. It would allow
states to reduce emissions through a number of measures that take
place outside the power plants, including building out renewable
energy and boosting end-use efficiency, as well as emissions credit
trading.
This "outside the fenceline" approach to regulating
greenhouse gases is the major argument of the opposition, who claim
the Environmental Protection Agency (EPA) exceeded its authority
under the Clean Air Act. The challenge, led by a coalition of 29
states and state agencies, is a significant victory for the
opposition.
Effect in the U.S.
Industry estimates that the plan, once in full effect, would
lead to the closing of more than fifty coal-fired plants. The EPA
and the Justice Department's lawyers dispute that
estimate.
Jody Freeman, a Harvard law professor and former environmental
legal counsel to the Obama administration, told The New York
Times that the ruling suggests a "high degree" of
skepticism toward the CPP from five justices on the court.
Even if the rule is ultimately upheld, the Supreme Court's stay
could significantly impact compliance timelines for states and
utilities. As it stands, the EPA will be unable to enforce its
September deadline for states to submit compliance plans or request
an extension. Without enforcement from the EPA, states may have to
decide on their own whether to comply.
Challenging parties argued that the rule was already prompting
states to write compliance plans and forcing power companies to
make decisions on whether to retire coal-fired power plants, or
avoid making investments in new plants. Most states are now
expected to halt their compliance efforts. Sen. Majority Leader
Mitch McConnell (R – Kentucky) had already been urging
governors to refuse to comply with the plan. "These
regulations are, in my view, likely illegal," McConnell
said1. "[The] Supreme Court order is just the
latest sign of that. If nothing else, it shows we were right to let
governors know their options."
However, William Becker, executive director of the National
Association of Clean Air Agencies, which represents2
state regulators charged with implementing the carbon rule, said
that efforts to reduce greenhouse gas emissions will not stop
because of the decision. "Almost every state in the country
has been working tirelessly over the past two years in preparing
Clean Power Plan strategies," he said. "We fully expect
that many of these states will continue their efforts to reduce
greenhouse gas emissions under their own legal
authorities."
The Democratic presidential candidates, Hillary Clinton and Bernie
Sanders, have pledged to continue and strengthen President
Obama's climate change agenda, so a rule developed by their
administrations would probably let the country meet its goals set
by the Paris Accord.
But Republican contenders, including Donald J. Trump, Sen. Ted Cruz
(Tex.) and Sen. Marco Rubio (Fla.), have questioned or denied the
science of human-caused climate change and sharply criticized the
climate change regulations and the Paris Agreement.
International Reaction
The decision could also weaken or even imperil the international
global warming accord reached with great ceremony in Paris less
than two months ago.
The Paris Agreement, the first accord to commit every country to
combat climate change, had as a cornerstone President Obama's
assurance that the United States would enact strong, legally sound
policies to significantly cut carbon emissions. The United States
is the largest historical greenhouse gas polluter, although its
annual emissions have been overtaken by China's.
In the capitals of India and China, the other two largest
polluters, climate change policy experts said the court's
decision threw the United States' commitment into question, and
possibly New Delhi's and Beijing's.
The top priority for Indian Prime Minister Narendra Modi remains to
provide cheap electricity to the 300 million Indians without power.
If the United States reneges on its commitments, "it really
would strengthen the hand of those who say Paris was ineffective
and a bad deal for India," according to Navroz K. Dubash, a
senior fellow at the Center for Policy Research in New
Delhi3.
"If the American clean energy plan is overturned, we'll
need to reassess whether the United States can meet its
commitments," said Zou Ji, the deputy director general of
China's National Center for Climate Change Strategy and
International Cooperation, a government think tank in Beijing.
There is also domestic resistance to low-carbon policies in China,
and opponents are likely to say: 'Look, the United States
doesn't keep its word. Why make so many demands on
us?'4
"U.S. pushback is not something that's unique to the
United States," said John Sterman, a professor of management
at the Massachusetts Institute of Technology who attended the
negotiations in Paris. "It's happening all over the
developed world."5 Poland and some other coal-reliant
countries have resisted the EU's commitment under the agreement
to more stringently reduce emissions across its member
states.
The stay is expected to last through much of the year, until the
D.C. Circuit makes a final ruling. A decision in that case is
expected in late 2016 or early 2017. Regardless of the outcome, the
decision is likely to be appealed by either foes or proponents, and
sent to the Supreme Court for a full merit review.
White House officials insisted that the rule would eventually be
upheld, and that given the timetable for litigation and for meeting
the target, the United States could still achieve its Paris
commitment.
Footnotes
1 Davenport, Supreme Court's Blow to Emissions Efforts
May Imperil Paris Climate Accord, click here. (Feb. 10, 2016).
2 Pyper, Breaking: Clean Power Plan Stayed by Supreme Court, Obama
Handed a Setback, click here. (Feb. 9, 2016).
3 Davenport, Supreme Court's Blow to Emissions Efforts May
Imperil Paris Climate Accord, click here. (Feb. 10, 2016).
4 Davenport, Supreme Court's Blow to Emissions Efforts May
Imperil Paris Climate Accord, click here (Feb. 10, 2016).
5 Davenport, Supreme Court's Blow to Emissions Efforts May
Imperil Paris Climate Accord, click here. (Feb. 10, 2016).
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.