U.S. Supreme Court ruling limits EPA’s authority in regulating greenhouse gases

The San Miguel Electric Cooperatives coal-burning plant is shown in 2019. The U.S. Supreme Court ruled that the Environmental Protection Agency does not have broad authority to require states to decarbonize their electricity sectors. (Miguel Gutierrez Jr./The Texas Tribune, Miguel Gutierrez Jr./The Texas Tribune)

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The U.S. Supreme Court ruled Thursday that the Environmental Protection Agency does not have broad authority to require states to decarbonize their electricity sectors, a decision that is expected to dramatically slow the United States’ ability to reduce greenhouse gases and mitigate the effects of climate change.

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The court’s 6-3 ruling on a case sparked by Texas and 16 other states — which addressed an Obama-era regulation aimed at coal-fired power plants, one of the biggest sources of greenhouse gas emissions in the nation — was a blow to President Joe Biden’s plan to reduce U.S. emissions and meet the country’s goals under international agreements.

Texas Attorney General Ken Paxton was among 17 Republican state attorneys general who sued the EPA over an Obama-era regulation known as the Clean Power Plan, which never went into effect. It was repealed and replaced by what was called the Affordable Clean Energy rule under the Trump administration.

Paxton said the decision was a “victory for energy independence.”

“This is a great day for American energy production,” he said in a statement.

The decision, which limits EPA’s authority to implement regulations that cause shifts in fuel sources for electricity generation, will make it difficult for the U.S. to do its part to meet a 1.5-degree Celsius target that scientists have said is key to preventing extreme effects of climate change, experts said.

“We have to act rapidly to cut emissions in order to avoid the worst impacts of global warming,” said Luke Metzger, executive director of Environment Texas. “And it’s unlikely that the natural or economic environment of these coal plants will happen fast enough to meet those emission goals.”

The ruling could also open the door for more aggressive challenges to federal regulations at any agency, administrative and environmental lawyers said.

“I do think you’re going to see other federal agencies sit back [as a result of the case],” said Anne Austin, an environmental lawyer who was an assistant administrator for the EPA’s Office of Air and Radiation during the Trump administration. The ruling may cause federal agencies beyond the EPA to narrow regulations to avoid what could now be “shaky legal ground.”

“Federal agencies are more likely to be challenged [in court],” added Austin, a former EPA Region 6 administrator. States that want to prevent certain federal regulations are likely to take a broad view of the majority’s opinion, she said.

The legal battle had delayed attempts by the EPA to reduce greenhouse gas pollution from the coal-fired power plant industry, one of the nation’s largest sources of climate-warming emissions. The ruling means the Biden administration will have to jump through a series of regulatory hoops to change a Trump-era rule that will now go back into effect and back in court — and it’s running out of time to make meaningful strides on climate policies before the end of Biden’s term.

“The fact that the Supreme Court has been deliberating on this case has sort of frozen EPA’s ability to issue new climate policies,” said Dan Cohan, an associate professor of civil and environmental engineering at Rice University who has studied air pollution from coal-fired power plants. “If not for this case, we probably already would’ve seen major regulations issued by the EPA on greenhouse gas emissions.”

The Biden administration said last year that it would implement new policies to slash greenhouse gas emissions in the U.S. One of the major goals Biden set was to reach 100% carbon-free electricity by 2035 — a target that now appears nearly out of reach.

The 2014 Obama-era rule at the heart of the Supreme Court ruling Thursday would have required states to meet specific carbon emission targets — and those targets would have been difficult to achieve without shuttering some coal-fired power plants. But eight years later, the emission targets were met anyways as coal-fired plants closed due to high costs and new competition.

But Republican attorneys general, led by West Virginia, challenged a decision by Washington, D.C., federal judges that vacated the Trump administration’s replacement rule to preempt the EPA from imposing more greenhouse gas regulations on power plants during Biden’s administration.

“I am pleased the Supreme Court reversed the D.C. Circuit and endorsed my arguments,” said Jonathan Brightbill, who argued the D.C. case for the government during the Trump administration. “Today’s ruling is one of the most significant developments in administrative law.”

“I think a large number of other administrative agencies will now be thinking really hard about certain policy proposals,” Brightbill added.

The Supreme Court sided with the states’ characterization of the case, which had argued that it would allow EPA to mandate “wholesale restructuring” of the electricity sector. Chief Justice John Roberts, who delivered the majority opinion, wrote that the Obama-era regulation was too broad of an interpretation of the agency’s authority under the Clean Air Act.

“Agencies have only those powers given to them by Congress,” Roberts wrote. “The agency … must point to ‘clear congressional authorization’ for the power it claims.”

“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 wrote, “But it is not plausible that Congress gave EPA the authority to adopt on its own such a regulatory scheme.”

Texas, with its large population, massive industrial sector and what some electricity experts say are lax rules on power plants, emits the most carbon dioxide emissions of any state, according to the Energy Information Administration.

Now, with the limited Trump-era ACE rule back in effect and back in court, the EPA will have to explain why it wants to change its own rule again — a long process that will be difficult to accomplish this late in Biden’s term, experts said.

Justice Elena Kagan, writing for the dissent, said the majority has a “misunderstanding” of how the electricity market works — every regulation of power plants dictates the national energy mix to some degree, Kagan wrote, and warned that the court may have overstepped by deciding how much regulation is too much.

“The Court appoints itself — instead of Congress or the expert agency — the decision-maker on climate policy,” Kagan wrote. “I cannot think of many things more frightening.”

Since the EPA sought to regulate coal-fired power plants under the 2014 Clean Power Plan, several in Texas have shut down, as companies replaced them with plants that run on a cheaper fuel source: natural gas. American Electric Power is expected to shutter its Pirkey Plant in Hallsville in 2023, and several others announced the same during the Trump administration, leaving 15 coal plants operating in the state, according to an analysis by Environment Texas.

Those plants contribute to dangerous health impacts, experts said. A model of air pollution and health by Rice University researchers in 2018 found that the W.A. Parish coal-fired power plant southwest of Houston contributes an average of more than 100 excess deaths of Texans per year from the health impacts of air pollutants including particulate matter.

As natural gas prices have risen in recent years, coal-fired plants have been given new life. The Energy Information Administration said in 2021 that higher natural gas prices had increased the share of U.S. electricity generated by coal, in turn increasing greenhouse gas emissions.

One coal plant in Texas, Martin Lake in Tatum, emitted 13.5 million metric tons of greenhouse gases in 2020, according to an analysis of EPA data by Environment Texas. That’s equal to emissions from about 3 million passenger vehicles. Three coal-fired power plants in Texas, including Martin Lake, were among the top 10 highest greenhouse gas polluting plants in the country that year, according to the analysis.

“Whatever else this Court may know about, it does not have a clue about how to address climate change,” Kagan wrote. “And let’s say the obvious: the stakes here are high.”

Disclosure: Rice University has been a financial supporter of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune’s journalism. Find a complete list of them here.

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