The environment, greenhouse gases, and the SCOTUS: On Utility Air v. EPA

5-cent explanation: To what extent can the Environmental Protection Agency regulate greenhouse gas emissions from stationary, i.e. industrial, sources?

10-cent explanation: In 2007, SCOTUS ruled in Massachusetts v. EPA that the EPA could regulate greenhouse gas emissions (GHGs), per the Clean Air Act (1970), so long as they were deemed a danger to public health. The agency accordingly concluded that GHGs from motor vehicles were dangerous and began to regulate them. The agency also concluded if it was going to reduce GHGs from mobile sources, stationary sources should be regulated as well.  

The problem is, when the Clean Air Act was signed into law, GHGs on the whole were not the intended target of the legislation. Widely accepted air pollutants at the time, like Carbon Monoxide, prompted the establishment of thresholds for stationary sources at 100 to 250 tons per year. GHGs, however, are an entirely different beast because more than six million buildings around the country- everything from schools to hospitals to large homes- emit more than 100 tons of GHGs annually. This would have created an administrative nightmare where regulating stationary sources at the statutory levels would completely overload the agency with permitting procedures and consequently defeat the purpose of regulating GHGs in the first place. Thus, EPA “tailored” the law and set higher stationary thresholds for GHGs at 100,000 tons per year, thereby allowing the agency to effectively carry out its mission of decreasing GHG emissions.

A couple of issues arose in this case. First, there’s the question of whether the agency’s ability to regulate emissions from mobile sources triggers a corresponding need to regulate stationary sources for the same pollutant. Environmentalists argue that curbing GHGs is a primary goal therefore both sources should be regulated. The second major issue stems from EPA’s decision to “tailor” the Clean Air Act to meet its current needs. On the one hand, Congress explicitly laid out thresholds for monitoring stationary sources that EPA did not adhere to. On the other, EPA is tasked with regulating GHGs – as they pose a significant danger to public health – and it requires only a slight modification of the numbers.

Although SCOTUS had a handful of cases surrounding the EPA and GHGs to choose from heading into the October 2013 term, the Court chose to narrowly weigh in on this single issue. In doing so, SCOTUS implicitly accepted that GHGs do in fact pose a threat to human health, and furthermore, the agency has the power to curb emissions from the exhausts of mobile sources such as cars and trucks.

The decision: Justice Scalia authored the (9-0) majority* opinion. Here are three main points:

  1. EPA cannot regulate GHGs from stationary sources simply because it has the power to do so for mobile sources.
  2. EPA cannot set its own threshold limits for regulating stationary sources when Congress has already explicitly set those limits in statute, even if it would be an administrative nightmare for the agency.
  3. EPA can require stationary sources to use best available control technologies to control GHGs so long as the source already emits other types of air pollution and therefore was already under agency regulation.

In a nutshell, the first points were losses for EPA and hammered home that the agency had abused its authority. The third point, however, is what pragmatically matters most, and ultimately will allow EPA to regulate GHGs for almost all of the stationary sources that it was already regulating (83% of all stationary sources emitting GHGs as opposed to the desired 86%).

Despite the overall win for EPA, Scalia selected some scathing language in his criticism of EPA’s violation of the separation of powers. He wrote, “An agency may not rewrite clear statutory terms to suit its own sense of how the statute should operate… We are not willing to stand on the dock and wave goodbye as EPA embarks on a multiyear voyage of discovery.” Scalia might have sided with EPA, but his opinion indicated it was most likely begrudgingly. It’s almost like the Court wanted to severely rebuke EPA for its overreach, but ultimately decided that the cost of global warming wasn’t worth it and therefore threw the agency a lifeline.

Related News:   You might have heard about the conflicting rulings from federal appeals courts about tax subsidies in Obamacare. As if it weren’t already hard enough to explain the judicial system to friends and students… we digress. Out of this EPA case might hide a clue, or “poison pill” as legal scholar Cass Sunstein coined it, for the future of Obamacare’s tax subsidies should such a case(s) go to SCOTUS. Sunstein quotes from the Scalia’s opinion, “an agency has no power to ‘tailor’ legislation to bureaucratic policy goals by rewriting unambiguous statutory term.” This could spell trouble for proponents of Obamacare given the specific writing of the ACA. Nevertheless, Sunstein has also gone on the record saying he thinks that the Fourth Circuit (the appeals court that unanimously upheld the subsidies) was right and a majority of the Supreme Court would stand by that decision.

*The majority opinion is a little tough to navigate given the jumbled ruling. Scalia authored three main points. On the first two, the Court split down ideological lines 5-4, and on the last point, Alito and Thomas were the sole dissenters in a 7-2 ruling.

We enjoyed this article from SCOTUSblog on the case entitled “Can the EPA really regulate a statute?  Really?

This piece was written by contributor Elliot Louthen.  Follow him on Twitter @ElliotLouthen.