Environmental, social, and governance risks and opportunities

Supreme Court to Hear Climate Change Regulation Case

ESG law

If there was any question that the judiciary was a coequal and political branch of government, last Friday after President Biden was wheels up to attend the COP26 Glasgow climate conference, the Supreme Court agreed to review the Environmental Protections Agency’s authority to regulate greenhouse gas emissions.

This litigation over the EPA’s scope of authority comes to the high court in a quartet of environmental cases on appeal from the U.S. Court of Appeals for the District of Columbia Circuit. In January, the day before President Trump left office, the D.C. Circuit vacated both the Trump Administration’s decision to repeal the 2015 Clean Power Plan, which established guidelines for states to limit carbon dioxide emissions from power plants, and the Affordable Clean Energy Rule that the Trump administration issued in its place.

The Supreme Court never had the opportunity to fully consider the Obama administration rules, the implementation of which had been stayed, and then the complexion of the judicial review swung widely from the Trump administration to the Biden administration. 

The precise issue the Supremes granted certiorari on is, “Whether, in 42 U.S.C. § 7411(d), an ancillary provision of the Clean Air Act, Congress constitutionally authorized 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, nonair impacts and energy requirements.”

Urging the justices to take the case, one of the challengers, the North American Coal Corporation, stressed what the Court should resolve, “as soon as possible is who has the authority to decide those issues on an industry-wide scale — Congress or the EPA.” Unless the justices weigh in, the company warned,

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these crucial decisions will be made by unelected agency officials without statutory authority, as opposed to our elected legislators.”

The Biden administration told the justices that there was no need for them to step in now, because the Clean Power Plan “is no longer in effect and EPA does not intend to resurrect it.” Instead, the government explained, it intends to issue a new rule that takes recent changes in the electricity sector into account. “Any further judicial clarification of the scope of EPA’s authority,” the government suggested, “would more appropriately occur” after the agency has actually issued the new rule.

After considering the cases at four consecutive conferences, with some political bravado the justices granted review on October 29, 2021, only hours before the opening of the COP26 Glasgow climate conference and ordered the cases to be argued together.

The high court’s decision in the case, which can be expected by summer 2022, could have an impact well beyond climate change law because it could impose new limits on Congress’ ability to delegate authority to all regulatory agencies.

We will follow the proceedings, ..

The lead case is West Virginia v. EPA. It is consolidated with North American Coal Corp. v. EPA, Westmoreland Mining Holdings v. EPA, and North Dakota v. EPA.

About the Author

Nancy Hudes and Stuart Kaplow, two Maryland attorneys who are among the principals at ESG Legal Solutions have combined forces, joining together to publish this blog leveraging their focused experience and legal knowledge for business interests in the ESG space.

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