The Supreme Court’s Clean Power Plan Missteps

Shocking both its proponents and opponents, the Supreme Court issued an order on February 9 staying the Clean Power Plan (CPP), which requires the U.S. power sector to make deep reductions in emissions of greenhouse gases (GHGs). The immediate effect of the stay will be to halt enforcement of the CPP while the courts conduct a full review of its validity under the Clean Air Act (CAA). This process could take 18 months or longer. As a result, the fate of the CPP—the centerpiece of the Obama administration’s climate change strategy—will be in limbo for the remainder of the president’s term and, in all likelihood, well into that of his successor. 

By issuing the stay, the court abandoned principles of judicial restraint and recklessly reached out to block the Obama Administration's flagship environmental initiative without explaining why it took this extreme step. Although a setback to the EPA and a shot across the bow by justices hostile to the CPP, the stay’s actual impact will be limited and temporary.  The D.C. Circuit Court of Appeals may uphold the CPP and a divided Supreme Court could well affirm that decision. Implementation of the CPP would then resume with minimal delay. Even if the CPP is struck down, power plant GHG emissions will continue to decline as the electricity sector moves away from coal and renewables capture larger market share. Granted, rejection of the CPP would complicate the task of policymakers, but a number of useful tools to curb GHG emissions will remain available under existing law and leadership states like California and New York will likely redouble their efforts to address climate change.

Applying the traditional stay criteria

Normally, stay requests are the domain of the courts of appeals, which review challenges to agency regulations before the Supreme Court decides whether to enter the fray. Following this path, petitions to review the CPP and accompanying stay requests were filed with the Court of Appeals for the D.C. Circuit last fall. That court denied a stay on January 21, concluding that the CPP challengers “had failed to satisfy the stringent requirements” for a stay, and set an expedited schedule for reviewing the CPP on the merits. For the Supreme Court to intervene after the lower court had denied a stay and without waiting for it to examine the legality of the CPP is unprecedented, yet its brief order provides no rationale for this extraordinary step.

The four justices appointed by Democratic presidents dissented from the stay order, mirroring the sharp partisan divisions around the CPP in Congress and the nation’s statehouses. The stark split between the court’s liberal and conservative factions, coupled with the majority’s failure to explain its decision, has prompted speculation that the stay was more influenced by politics than by careful legal analysis.

Showing irreparable injury

Stays of agency action are rare because, in the absence of full judicial review, the courts are reluctant to second-guess executive branch decisions unless there will be substantial irreparable harm to affected parties and the government has failed to provide convincing reasons for proceeding with regulation. Many observers felt that states and industry had made weak showings of irreparable harm because compliance with the CPP is not required until 2022 and the CPP’s earlier planning deadlines are merely administrative and do not impose significant obligations on states or utilities.

While CPP opponents claimed that some coal-fired power plants would be retired in anticipation of CPP restrictions and that states would in fact expend significant resources on compliance planning, these arguments were strained and speculative. Many coal plants have been shuttered already and others were earmarked for retirement before the CPP became final last fall. More will undoubtedly close in the next few years but how much these closures will be driven by the CPP and when they will occur are matters of guesswork. The CPP’s planning deadlines hardly force immediate action by states and power companies:  the first CPP deadline—September 16, 2016—is simply for requesting more time to develop state plans. The plans themselves are not due until September 16, 2018, by which time the pending court cases should be resolved.

Although a setback to the EPA and a shot across the bow by justices hostile to the CPP, the stay’s actual impact will be limited and temporary.

It’s impossible to know how—if at all—the court majority weighed these considerations. Perversely, the majority could have turned the government’s argument on its head, reasoning that a stay would not be harmful precisely because the CPP’s compliance dates are so distant. But this logic would be a radical departure from the traditional standards for a stay, which put the burden on those challenging regulations to demonstrate irreversible harm if they are implemented.

U.S. international standing

The government argued that a stay would be harmful because it would call into question the executive branch’s ability to deliver on the emission reduction commitments it had made at the recent Paris climate talks (COP21) and weaken support for global action on climate change, an Obama administration priority. These considerations should have carried significant weight. Perhaps the majority downplayed them on the ground that any harm to U.S. diplomacy would be short-lived if the CPP is ultimately upheld and, if it is not, the U.S. diplomatic posture would need to be revisited anyway. If this was the majority’s reasoning, it ignores the tangible near-term damage to U.S. credibility and the inevitable loss of momentum in implementing the Paris agreement resulting from global uncertainty over U.S. climate policy.

Mr. James Moore

Mr. James Moore

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