In a 5–4 decision announced on June 29, the U.S. Supreme Court overturned the Environmental Protection Agency’s (EPA’s) rules limiting mercury and other hazardous air pollutants released from power plants.
In April 2014, the U.S. Court of Appeals for the D.C. Circuit upheld the Mercury and Air Toxics Standards (MATS), ruling in a 2–1 decision that the EPA was not required to take costs into account when it promulgates rules that are “appropriate and necessary” to address hazards to public health. On Nov. 25, 2014, the Supreme Court agreed to hear the case. Although power plants were required to comply with the rule in April 2015 unless they had received an extension, the decision remands the case back to a lower court for further proceedings consistent with the opinion.
Justice Antonin Scalia, writing for the majority, said that it was not appropriate for the EPA “to impose billions of dollars in economic costs in return for a few dollars in health or environmental benefits.”
— Scotus (@Scotus) June 29, 2015
Approximately 62 GW of coal-fired electric generating capacity in the U.S. has already been retired or converted to other fuel sources in an effort to comply with the MATS regulation. It is unlikely that the Supreme Court decision will have any effect on the majority of the closed facilities.
In the decision, Scalia made the following analogy. “By EPA’s logic, someone could decide whether it is ‘appropriate’ to buy a Ferrari without thinking about cost, because he plans to think about cost later when deciding whether to upgrade the sound system.”
Justice Kagen responded in her dissenting opinion, “The comparison is witty but wholly inapt. To begin with, emissions limits are not a luxury good: They are a safety measure, designed to curtail the significant health and environmental harms caused by power plants spewing hazardous pollutants. And more: EPA knows from past experience and expertise alike that it will have the opportunity to purchase that good in a cost-effective way. A better analogy might be to a car owner who decides without first checking prices that it is ‘appropriate and necessary’ to replace her worn-out brake-pads, aware from prior experience that she has ample time to comparison-shop and bring that purchase within her budget. Faced with a serious hazard and an available remedy, EPA moved forward like that sensible car owner, with a promise that it would, and well-grounded confidence that it could, take costs into account down the line.”
In the end, Chief Justice Roberts and Justices Thomas, Alito, and Kennedy joined Scalia in overturning the rule, while Justices Kagan, Ginsberg, Breyer, and Sotomayor sided with the EPA.
Opponents of the regulation applauded the ruling, while environmental groups expressed disappointment. The decision also offers hope for potential challengers of the EPA’s proposed Clean Power Plan, which a National Economic Research Associates (an economic consulting firm) study says could cost $366 billion through 2031 and increase electricity prices by 12% or more.
“Today’s Supreme Court decision is a win for American consumers and a rebuke of EPA’s callous approach to regulations,” said Mike Duncan, president and CEO of the American Coalition for Clean Coal Electricity. “We hope that with today’s ruling, the EPA finally recognizes there are limits on its authority and takes the opportunity to withdraw its harmful carbon rules. If they don’t, I’m sure we’ll be seeing them in court again very soon,” Duncan added.
The court’s decision today vindicates the House’s actions to rein in bureaucratic overreach & institute some common sense in rulemaking.
— Kevin McCarthy (@GOPLeader) June 29, 2015
— Ed Markey (@SenMarkey) June 29, 2015
—Aaron Larson, associate editor (@AaronL_Power, @POWERmagazine)