Will the Supreme Court Nip the EPA Next?

Too many people judge Supreme Court actions on whether they agree with the outcome, without reference to how the Court said it reached that outcome. Many who cheered when the Court kept the Trump administration from asking citizenship questions on the census cannot be happy with the recent decision respecting vaccination mandates and may be even more unhappy when the Court resolves three challenges to the Environmental Protection Agency’s (EPA) regulations on power plant energy production.

This Supreme Court appears to be chipping away at the behemoth Administrative State and the EPA’s regulations on greenhouse gas regulations may be next on the chopping block. That’s the view of Jonathan Adler at Volokh Conspiracy and I think he has a valid claim.

Not so fast, OSHA.

Adler’s thesis begins with the Occupational Health and Safety Administration’s emergency regulation which mandated that all private employers with one hundred employees  require its employees to be vaccinated against Covid or undergo repeated weekly testing for the virus. The Court ruled that this exceeded the agency’s grant by Congress to protect the health of workers in their place of employment  The Court made clear that without a clear congressional mandate the agency was never given congressional authority to make such  “ a significant encroachment into the lives—and health—of a vast number of employees.”

 There is a hint in Chief Justice Roberts and several other members of the court that they believed that the regulation was a pretextual effort to increase Covid vaccinations, and not a workplace safety move. And the scope of OSHA’s mandate is, after all, simply and exclusively workplace safety. The notion that regulations might be held invalid because they were pretextual even if the agency could provide a reasonable justification for them, was signaled  in an earlier case involving the right of the Trump administration to reinstate a citizenship question in the census:

 [T]he Chief Justice's decision to prop open the door to consider pretext invites litigants challenging agency actions to search for evidence -- whether or not in the official record -- to show that they, too, have been the subject of an unlawfully pretextual agency action. There is nothing in the Chief Justice's opinion that suggests this analysis is to be confined to those contexts in which the distribution of political power or other particularly weighty concerns are at stake, and there is much language in his opinion... that could find a ready home in legal challenges against HHS, the Education Department, or the EPA.

This is a departure from the usual view on judicial review . Normally, if the regulators can provide a reasonable justification and the regulation aligns with the statutory mandate, courts will not interfere. It also justifies court consideration of matters outside the text of the regulations itself. In sum, it presaged the OSHA case where the White House chief of staff Ron Klain retweeted that this regulation was a “work around” to increase the number of people vaccinated when there was no authority for an executive order compelling it.

Other evidence of the pretextual nature of the  vaccine mandate regulations is found in its own language--the deciding factor for coverage was the number of employees and not the workplace conditions. So, for example if all those one hundred employees were working from home they were covered by the mandate, but if a ninety nine- employee shop involved people working close together in poorly ventilated settings they were not. Seems fairly obviously irrational, doesn’t it?

Block that pretext!

The left may have cheered the census case outcome -- the Supreme Court remanded the issue back to the lower courts and in so doing delayed inclusion of the question in the census-- but it may come back to bite them as coming up on the docket is a case involving the EPA and its authority to regulate greenhouse gases.

This case comes up on several writs of certiorari to the court, challenging a decision by the U.S. Court of Appeals for the District of Columbia which held that the Environmental Protection Agency (EPA) had authority under the Clean Air Act  to regulate greenhouse gas emissions from power plants. Then President Trump rescinded the Obama Administrations Clean Power Plan (CPP) and adopted an Affordable Clean Energy (ACE) in its place. The D.C. court concluded that the Trump Administration's recision was arbitrary and capricious, though it did not compel a reinstatement of the CPP, and the EPA still has not come up with new regulations. In the face of the Supreme Court trend to clip administrative agency wings the EPA is in limbo presently. It has no idea how far the new regulations may sweep.

The three cases upon which the Court granted certiorari broadly question EPA’s authority -- does the Clean Air Act have any limits? What are these administrative boundaries? For example, can the agency ignore cost of compliance, the power of states to set performance standards, reshape the nation’s electricity grid? These, among others, are the questions raised by the three petitioners.

However the Court decides, it is likely to be the most important environmental (and energy) decision cases in the court’s history. And it seems to follow on a partisan attack on the revival of an apparently unrelated citizenship question in the census. On such things does the course of history turn.

The Court Steps in to the War on Greenhouse Gases

What’s a g,reenhouse gas and who and how can regulate it? The Supreme Court has agreed to decide whether the Environmental Protection Agency has the authority to regulate greenhouse gases in a quartet of appeals from the U.S. Court of Appeals for the District of Columbia. Their decision could spell the end of the administrative agencies' hitherto unbounded, extra-legal ability to "regulate" U.S. business.

The matter begins with then-President Obama’s  Clean Power Plan of 2015. That plan established guidelines for states to limit carbon dioxide emissions.  The essential features of the plan, which was designed to boost renewable energy sources in place of fossil-fuel generated power, set standards to reduce CO2 emissions by 32 percent from 2005 levels by the year 2030. It required each state to submit plans to the EPA for reaching those goals and gave them until 2022 to comply with the approved plans. This grand plan was short-lived. Two years later under President Trump the head of the EPA proposed a rule repealing the plan Subsequently, after a review, the EPA did repeal the Plan.

Barry's brainchild.

Administration action was not the sole block to enforcement of the Plan --  industry groups and twenty-seven states filed legal challenges to the Obama plan:

because the E.P.A. assumed utilities could reduce emissions at individual plants by taking actions outside of those plants — say, by replacing coal plants with wind farms elsewhere. Industry groups and more than two dozen states challenged this move in court, arguing that the EPA can look only at cleanup measures that can be undertaken at the plants themselves.

The states argued that the Clean Air Act under which the EPA was acting never gave the agency the power to regulate CO2 emissions and the Supreme Court held enforcement of the plan in abeyance until the court challenges could be resolved.

It's unprecedented for the Supreme Court to step in and block a federal regulation like this, before review by an appeals court. None of the justices gave any explanation for the move. The justices voting to block the rule were Roberts, Alito, Scalia, Thomas, and Kennedy.

In January of this year after lengthy hearings on the issue the U.S.  Court of Appeals for the District of Columbia struck down the effort to repeal the Obama emissions plan. That Court remanded the matter to the EPA to craft regulations on power plant CO2 emissions.

The Court noted that the Clean Air Act grants the federal agencies the power to regulate air pollution. Significantly, however, the Court did not direct the EPA to readopt the Obama plan that Trump had repealed. That means EPA has to start over, and the latest  Supreme Court action means the EPA cannot even begin the process until sometime in the middle or late 2022 after the Court decides the case it just decided to hear. So none of the EPA regulations in this area are operable now. To me, it’s a stretch  to consider CO2 a pollutant. Nevertheless, as the D.C. Court observes in its opinion the Supreme Court has held that CO2 is a pollutant:

It was not until the Supreme Court’s 2007 decision in Massachusetts v. EPA, however, that the Court confirmed that carbon dioxide and other greenhouse gas emissions constituted “air pollutant[s]” covered by the Clean Air Act. The Supreme Court explained that the Clean Air Act’s “sweeping definition of ‘air pollutant’ includes ‘any air pollution agent or combination of such agents, including any physical, chemical . . . substance or matter which is emitted into or otherwise enters the ambient air...'  On its face, the definition embraces all airborne compounds of whatever stripe, and underscores that intent through the repeated use of the word ‘any.’ Given that statutory command, the Supreme Court ruled that the EPA “can avoid taking further action” to regulate such pollution “only if it determines that greenhouse gases do not contribute to climate change” or offers some reasonable explanation for not resolving that question.

You can practically smell the absence of CO2.

At no point to my knowledge has Congress held that it considers C02 a pollutant. The closest statutory language I can find is in the 1987  Global Climate Protection Act which found that “manmade pollution[,]” including “the release of carbon dioxide... may be producing a long-term and substantial increase in the average temperature on Earth[.]”

The  four cases which are joined in the matter  in which the Supreme Court just granted certiorari  cover a variety of related issues including the scope of the Clean Air Act  whether regulations must be based on existing technologies and methods at existing sources (that is, individual plants) and not industry-wide ones, and whether  the EPA usurped state regulatory powers.

In 42 U.S.C. § 7411(d), an ancillary provision of the Clean Air Act, did Congress constitutionally authorize the Environmental Protection Agency to issue significant rules—including those capable of reshaping the nation's electricity grids and unilaterally decarbonizing virtually any sector of the economy—without any limits on what the agency can require so long as it considers cost, non-air impacts, and energy requirements?

Whether 42 U.S.C. § 7411(d), which authorizes the EPA to impose standards "for any existing source" based on limits "achievable through the application of the best system of emission reduction" that has been "adequately demonstrated," grants the EPA authority not only to impose standards based on technology and methods that can be applied at and achieved by that existing source, but also allows the agency to develop industry-wide systems such as cap-and-trade regimes.

Whether 42 U.S.C. § 7411(d) clearly authorizes EPA to decide such matters of vast economic and political significance as whether and how to restructure the nation's energy system... Can EPA promulgate regulations for existing stationary sources that require States to apply binding nationwide "performance standards" at a generation-sector-wide level, instead of at the individual source level, and can those regulations deprive States of all implementation and decision making power in creating their Section 111(d) plans?

Can EPA promulgate regulations for existing stationary sources that require States to apply binding nationwide "performance standards" at a generation-sector-wide level, instead of at the individual source level, and can those regulations deprive States of all implementation and decision making power in creating their Section 111(d) plans?

Professor Jonathan Adler offers up the most valuable of the commentaries on these matters I can find.

This case could be tremendously significant beyond the question of the EPA's regulation of greenhouse gases because (as detailed below) the questions presented encompass both the immediate question of what authority the EPA has under Section 7411 of the Clean Air Act, but also the broader question of how prescriptive Congress must be when delegating broad regulatory authority to federal agencies. This gives the Court room to refine and expand the "major questions" doctrine (as I have suggested it might want to do), as well as to perhaps identify some of the outer limits on delegation more generally.

Thanks, Nixon!

It’s peculiar, as Adler also observes, that the Court took up the case now as the Biden Administration has not even proposed its own regulations. Four of the justices had to agree to hear theses cases for the writ of certiorari to be granted. To Adler, and me, the fact that at least four justices are concerned about the broad grant of administrative power to the EPA hints at some effort to require Congress to be more “prescriptive” to regulatory authority to administrative agencies. Perhaps the days of Congress leaving to the executive branch to fill in broad empty provisions in legislation will be coming to an end. Perhaps , as well, the Court is rethinking its decision in Massachusetts vs. EPA on CO2 emissions as pollutants.

However, this case is resolved -- and I dare not predict these days -- it will have far reaching implications for environmental law. As well, it may set new boundaries on the interactions between Congress and the executive branch and whether the administrative agencies’ powers, so long given very broad reach, will be clipped and Congress forced to exercise its constitutional responsibilities.