June 23, 2014

Partial victory in Supreme Court greenhouse gas decision

By Anthony L. Francois Senior Attorney

Today the United States Supreme Court decided a very important case with implications for the nation’s economy and for the rule of law. In Utility Air Regulatory Group v. EPA, the Court held that EPA violated the Clean Air Act by asserting authority to regulate greenhouse gas emissions from millions of apartment houses, office buildings, malls, hotels, and other commercial structures, but complied with the Act as to limiting greenhouse gas emissions from most existing power plants and manufacturing businesses.

The Act divides air pollution into two categories, based on its source. As PLF’s amicus brief in this case explains, for stationary sources the Act only allows EPA to regulate emissions of criteria pollutants, for which the agency must establish ambient air quality standards. In this case, EPA announced a new permitting regime for carbon dioxide emissions from existing stationary sources without declaring the gas a criteria pollutant or setting air quality standards for it.

The court struck down this action to the extent that it would require an air quality permit only for greenhouse gases.  This portion of the decision is a big win for owners, operators, tenants, and other residents of millions of residential and commercial buildings that do not presently require conventional air quality permits.  These facilities could have faced $147 billion in permitting costs, while delays in issuing permits would have ground thousands of construction projects to a halt nationwide.

But for existing facilities that otherwise must obtain and comply with permits for conventional air pollutants, the Court held that EPA could require these facilities to employ “best available control technology” to reduce carbon dioxide emissions as well.  While these facilities number in the low tens of thousands instead of millions, they still account for 83% of the greenhouse gases EPA is seeking to regulate from stationary sources. One of the “best available control technologies” that the EPA has in mind is carbon capture and storage, which is the enormously costly process of capturing and liquefying CO2 and then pumping it into the ground. Some facilities which use coal for fuel may be able to change to natural gas.

So while it is good that the Court holds that EPA cannot regulate carbon dioxide alone in its stationary source permitting, the decision to allow regulation of greenhouse gases in combination with other air pollutants is sobering. Ultimately, the responsibility for clarifying, simplifying, and rationalizing our national environmental laws rests with the Congress. The legislature passes statutes that are too broad and provide the executive with too much leeway for mischief, and then sits back and watches while executive agencies run amok. The courts can (and in this case did) trim the sails when agencies employ invalid interpretations of their own power, but for those important facilities still subject to EPA’s permitting authority, only Congress can change the direction of this ship.

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