Although a good, sound policy, the president’s Clean Power Plan — the rule regulating greenhouse gas emissions from existing power plants — will unleash a torrent of litigation rivaling that following the passage of the Affordable Care Act. Most major environmental rules generate legal challenges, but there are three reasons why this one will generate a litigation tsunami.
The first is rooted in interest group politics. Coal-fired power has commanded the lion’s share of electricity generation in the United States, but it now faces an existential crisis. For the first time, it faces competition from cheap, domestically available gas and increasingly competitively priced renewable power.
At the same time, nongovernmental organizations and voters are waking up to the fact that coal combustion is much more harmful to human health and the environment than any other electric generation technology. Not only does it affect the climate, coal combustion kills thousands of Americans prematurely each year. The threat to coal’s dominance is unprecedented, and the industry has nothing to lose.
The second reason is ideological. Even in red states that stand to gain from the Clean Power Plan, elected officials choose to oppose the plan because that is “good politics.” For example, several analyses have concluded that the Clean Power Plan will produce net gains for Texas, because gas-fired power will replace coal-fired power, and much of that gas will come from Texas.
But suing the Environmental Protection Agency has been a sound electoral strategy for the past two Texas governors, one that fits the national GOP’s narrative portraying the Obama administration as regulation-happy “socialists” engaged in a “war on coal.”
Third, and most importantly, the rule does face real legal vulnerabilities. In the absence of congressional ability or willingness to address climate change, the EPA is doing so. The EPA is using a little-used section of the Clean Air Act, called section 111(d), to create a rule that will have sweeping effects across the power sector, and entails costs and benefits in the billions of dollars. In the final version of the plan, the EPA made changes that reduce those legal vulnerabilities, but some important questions remain.
Section 111(d) seems to contemplate emission limits on individual power plants, but the EPA’s proposed rule established limits based on the level of emission reduction each state was capable of achieving across its entire power sector. Critics challenged the EPA’s authority to regulate “beyond the fence line,” and the final rule establishes limits on emission rates only from the coal- and gas-fired power plants. States retain the flexibility to use a variety of measures to achieve those limits, but limits on individual sources are the foundation of the rule.
Still, there remain credible legal arguments about whether these emission rate limits are consistent with the statutory language, whether statewide limits were imposed using a fair system, and whether the statute even authorizes the rule in the first place. This last argument stems from a one-in-a-million drafting error by Congress in 1990, when the House-Senate conference committee failed to resolve a wording conflict in section 111(d), leaving both competing versions in the text. One version seems to foreclose the Clean Power Plan, the other to permit it.
Finally, some recent Supreme Court decisions, which show less deference to the EPA in its interpretation of the Clean Air Act and which scrutinize closely EPA rules that impose very high compliance costs, give encouragement to opponents of the Clean Power Plan. No doubt their legal challenges will be crafted to use those recent Supreme Court decisions to their advantage.
For all these reasons, we can look forward to years of legal challenges to the Clean Power Plan. That is a shame, because the EPA has gone out of its way to craft a plan that offers states time and flexibility, a plan whose benefits dwarf its costs and aims at goals (a cleaner energy mix) that are tremendously popular.
But in a polarized America, that may not be enough.
David Spence is a professor of business, government and society in the McCombs School of Business and professor of energy law in the School of Law at The University of Texas at Austin.
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— Texas Perspectives (@TexPerspectives) August 11, 2015