Since February, when the Supreme Court held oral arguments in a case challenging the EPA’s authority to regulate carbon pollution from power plants, environmental lawyers and climate activists braced for a ruling that tattooed a deep, restrictive swath into the agency’s ability to curb emissions.

The court’s 6-3 ruling, issued Thursday, did limit the EPA’s authority to rein in those emissions, saying the agency did not have sweeping power under the law regulating carbon pollution from utilities. Instead, it stripped EPA’s authority to regulate that pollution under a section of that law known as 111(d).

“It says EPA can’t do generation shifting,” Thomas Lorenzen, partner at Crowell & Moring and co-chair of the firm’s environment and natural resources group, said in an interview, referencing a method the Obama administration pursued to address pollution. “But that’s all it says. On everything else, it’s got running room,” he said. “Given the makeup of this court, this was not necessarily a bad day for EPA.”

To be sure, the court crimped the Biden administration’s options to combat domestic emissions, and the ruling hobbles the agency, chills what regulations federal agencies may propose, and weakens Congress and the executive branch while drawing power into the judiciary, experts said. Still, the EPA has options for addressing climate change.

President Joe Biden said after the ruling he would pursue all legal avenues to forestall climate change and its catastrophic economic and ecological effects.

“We cannot and will not ignore the danger to public health and existential threat the climate crisis poses,” Biden said.

“The science confirms what we all see with our own eyes — the wildfires, droughts, extreme heat, and intense storms are endangering our lives and livelihoods,” he said. “I will take action.”

In response to the ruling, EPA Administrator Michael S. Regan said, “EPA will move forward with lawfully setting and implementing environmental standards that meet our obligation to protect all people and all communities from environmental harm.”

The Supreme Court case centered on an Obama-era regulation from the EPA, called the Clean Power Plan, which never went into effect because the court stayed it in 2016, and a Trump-era policy replaced it. (The Trump policy was later struck down.)

While Regan did not specify what options the agency could follow, experts said EPA could use the same statute behind the Clean Power Plan or other sections of the Clean Air Act in new climate regulations.

Lorenzen said the EPA could consider naming carbon dioxide a hazardous pollutant. He and other environmental experts, such as Paul Billings, national senior vice president of public policy at the American Lung Association, said the agency has other pending climate proposals, including one on methane and others on passenger vehicles and heavy-duty trucks. “EPA has lots of tools,” Lorenzen said.

At oral arguments, the solicitor general for the Biden administration argued the court should rule for the government because the policy in question, the Obama-era plan, never went into effect – a point Billings made by phone.

“This is all about a Clean Power Plan that doesn’t really exist anymore,” he said, adding that the U.S. hit the emissions goals of the never-enacted plan well ahead of schedule. “The grid is cleaner than the grid envisioned by the Clean Power Plan,” he said. “The grid we have in 2022 looks nothing like that grid.”

Whatever the court has done, the momentum in moving away from fossil fuel sources for generation, primarily coal and gas, is significant, Billings said. “The transformation is on.”
New plan coming

By March 2023, the EPA plans to unveil its new power plant regulation, pushing the timeline to finalize the rule into the next year.

Writing for the majority in the case, West Virginia v. Environmental Protection Agency, Chief Justice John G. Roberts Jr. said the agency exceeded its authority under the Clean Air Act in writing the Obama-era rule.

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

In a dissent, Justice Elena Kagan wrote the court had substituted its own judgment over that of lawmakers.

“Whatever else this court may know about, it does not have a clue about how to address climate change,” she wrote. “And let’s say the obvious: The stakes here are high. Yet the court today prevents congressionally authorized agency action to curb power plants’ carbon dioxide emissions.

“The court appoints itself — instead of Congress or the expert agency — the decision-maker on climate policy,” she wrote. “I cannot think of many things more frightening.”
‘Major questions doctrine’

The ruling seems to solidify what is known as the “major questions doctrine” — a long-dormant legal theory now popular with conservative judges that says courts should not defer to agencies on topics of “vast economic and political significance.”

That doctrine was invoked in the court’s ruling to strike down the Biden administration’s COVID-19 vaccine mandate and poses a threat to other administration goals and policies, including environmental rules proposed for automobiles.

“It gives extraordinary power to the judges,” Lorenzen said of Thursday’s ruling, adding that the test of what fits the doctrine is hazy. “It’s very much like the old test for pornography,” he said, invoking Justice Potter Stewart’s 1964 comment about what is obscene. “I know it when I see it,” Potter said.

Karen Sokol, an environmental law professor at the Loyola University New Orleans College of Law, said in an interview she had not expected the court to overrule Massachusetts v. Environmental Protection Agency, the 2007 case that gave EPA the authority to regulate greenhouse gas pollution.

The ruling, she said, is “just about as far as they could have gone given the case before them.”

But in ways that could echo well into the future, the court consolidated its power and made the paths for passing climate laws or climate regulations more treacherous.

“This is basically a doctrine in which there’s no deference to agencies at all,” Sokol said. “And regulations are going to be caught up in it.”

While the court ruling last week in Dobbs v. Jackson Women’s Health Organization, removing the once-held federal right to an abortion, was more apparent in what it eliminated, this court decision could also have widespread repercussions, Sokol said.

“The rug’s been taken out from under us. It’s super clear,” she said of the abortion case. “It takes a while to unpack why, but it’s just as much a pulling back of that rug,” she said about Thursday’s decision.

Kirti Datla, director of strategic legal advocacy for Earthjustice, an environmental law group, agreed that the decision may cast a pall over what rules federal agencies draft.

“It’s probably going to have a deterrent effect on what agencies are going to propose,” Datla said by phone.

Roberts wrote in the majority opinion that an agency proposing a rule must be able to cite “‘clear congressional authorization’ for the power it claims.”

At a time of partisan division and dysfunction in Congress, which hasn’t passed a budget on time since 1996, the capacity for lawmakers to pass laws and authorize agencies to act with speed, knowledge and precision on myriad topics is unlikely, experts said.

“It’s just setting up this completely unworkable process,” Sokol said. “Even if we had a functional Congress, what sort of climate legislation would it be able to enact?” she said “This is a very complex problem. … It requires all sorts of experts.”

The Clean Power Plan, for example, took years and manifold federal staffers to write and publish. “It’s just not possible for Congress to do all of that,” Datla said. “Congress would just not be able to address the types of problems that have to be addressed on the timelines they need to be addressed.”

The court is sending a warning to the executive branch, she said. “This is kind of a shot across the bow from the court, saying, ‘Don’t try anything too big.’”