Kirsten Engel on CPRBlog {Bio}

The Merits of the Clean Power Plan Challenge: It all depends on Chevron

Further reflections on the April 16th Oral Argument in Murray v. EPA and West Virginia v. EPA

In an earlier blog entry, I predicted that the D.C. Circuit will refuse, on standard administrative law grounds, to consider the arguments of the petitioning states and coal and utility companies for overturning EPA’s proposed Clean Power Plant rule.  In short, a challenge to an on-going rulemaking is not ripe for judicial review until the agency issues its final rule.

But whether I am wrong or not, the court will surely reach the merits sooner or later, either now, or after the inevitable new lawsuit is filed when the rule is finalized.  What is clear, however, is that there is just no way of escaping administrative law in this case.  Like the jurisdictional issue, the merits would also seem to turn on a question of administrative law, that of the permissible scope of the familiar Chevron doctrine that directs a court to defer to an agency’s reasonable construction of an ambiguous statutory provision. 

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The Stuff of an 'Extraordinary Writ' or a Hum-drum Administrative Law Case?

Reflections on the April 16th Oral Argument in Murray v. EPA and West Virginia v. EPA

In a rulemaking there is a provision for judicial review, right, it’s not going to be a question that’s avoided . . . when the rule comes out, it’s going to be challenged, we’re going to get to it.  Why in the world would we resort to an extraordinary writ, which we have never used before?  So it really is quite unusual.

-  Judge Griffiths, remarking on the petitioner’s claim to jurisdiction in  Murray Energy v. EPA and West Virginia v. EPA, D.C. Circuit Court, Oral Argument, April 16, 2015.

This statement by Judge Griffiths during Thursday’s oral argument on the states’ and utility companies’ challenge to EPA’s proposed Clean Power Plan rule pretty much sums up the skepticism voiced by he and Judge Kavanagh in hearing the case prior to EPA’s promulgation of a final rule.  Despite the petitioners’ efforts to paint their challenge as justified by extraordinary aspects of the case, at least these two judges seemed to be having a hard time understanding the case as posing anything other than a garden-variety question of administrative law.  As a result, while it is always somewhat risky to predict a case outcome based upon oral argument, all clues point to a 2 – 1 majority (Judge Henderson dissenting), dismissing the appeal.  It could be a short-lived victory, however, as in contrast to the jurisdictional question, the panel’s views on the merits of the petitioners’ challenge – that EPA lacks authority to regulate existing power plants under Section 111(d) of the Clean Air Act considering the agency’s prior regulation of the mercury emissions of such plants – was anything but clear.  

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EPA's Standing Argument: A Sleeping Giant in the Tailoring Rule Litigation?

On Feb. 28 and 29, the D.C. Circuit is scheduled to hear arguments on a suite of industry-led challenges to EPA-issued greenhouse gas rules.  While attention has focused on industry’s challenge to EPA’s finding that greenhouse gases (GHGs) endanger the environment, industry’s challenge to the greenhouse gas permitting “tailoring” rule – a rule limiting the CAA’s application to only the largest GHG sources – is just as important, and just as interesting a battle.  At issue is constitutional law’s most hard-fought doctrine in environmental litigation: standing to sue. 

In its September 2011 brief, EPA contends that the Tailoring Rule is designed to alleviate the burden that the CAA would otherwise impose on a wide variety of stationary GHG sources.  Because it is alleviating, not imposing, a burden, the Tailoring Rule does not create the “injury” that industry must demonstrate to have standing to sue.  If the plaintiffs lack standing, then the court must dismiss industry’s challenge.  The injection of standing into the case makes the tailoring litigation all the more interesting because, as a result, the court may have a strong basis for dismissing what is otherwise considered a robust legal challenge to the Tailoring Rule. 

As an industry group argues in the Tailoring Rule case, Coalition for Responsible Regulation v. EPA, the agency’s rule raising the emission thresholds for Prevention of Significant Deterioration and Title V permits flatly contradicts the express language of the Clean Air Act.  The Clean Air sets these thresholds at 250 and 100 tons per year, multiples lower than the Tailoring Rule’s regulatory thresholds of at least 75,000 tons per year. EPA argues that upping the thresholds was “necessary” to avoid “absurd results” that would otherwise flow from the administrative burdens created by low statutory thresholds, thresholds that could subject numerous small-scale sources, like restaurants and other small businesses, to CAA permitting requirements for the first time. (EPA has said that simply implementing GHG controls without the Tailoring Rule would theoretically require 230,000 new employees to handle the permitting). This is a good common sense argument, but many courts are reluctant to ignore a statute’s literal language.  The courts may never reach the merits, however, if EPA succeeds in having the suit dismissed on standing grounds. 

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States' Proposal for Meeting Federal Climate Change Rules an Opportunity to Think Seriously about Regional RPS

States are seeking EPA approval to meet climate change-related standards through programs that the states themselves have pioneered. Greenwire reported last month that California, New York and Minnesota, as well as about a dozen power companies and advocacy groups, are urging U.S. EPA to let states meet the forthcoming New Source Performance Standards under the Clean Air Act through the Regional Greenhouse Gas Initiative, California’s forthcoming greenhouse gas cap and trade plan, as well as through clean or renewable portfolio standards (RPS).

This development could address an odd anomaly: while several major state-led programs to cap greenhouse gases are regional in nature (the Regional Greenhouse Gas Initiative, the Midwest Accord and the Western Climate Initiative), thus far the most powerful engine for the growth of renewable power – renewable portfolio standards, which require utilities to obtain a certain share of their energy from renewable sources – are primarily state-based. This should change. States would be better off employing the regional approach in their renewable energy incentive programs.

By mandating a certain percentage of renewable power in a utility’s energy portfolio, these laws enact a rate-payer subsidy for renewable power. RPSs have proven politically popular and extremely effective in growing the market for renewable energy. At last count, 26 states have adopted an RPS, another six have adopted a renewable portfolio goal and another five states have adopted an alternative energy standard. The Union of Concerned Scientists estimates that, by 2025, state standards will provide support for 76,750 megawatts (MW) of new renewable power. This will not only reduce conventional pollutants and help jump-start a greener economy, but is expected to reduce annual carbon dioxide emissions by more than 183 million metric tons, or the equivalent of taking 30 million cars off the road.

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States Go to Bat for Improving Climate Change Legislation

Five State Attorneys General sent a letter to the Senate leadership on August 31st urging the Senate to enact strong climate legislation. The AGs letter is unusual in that states directly lobbying Congress on the details of federal legislation is a fairly infrequent phenomenon in and of itself. The AGs from California, Arizona, Connecticut, Delaware, and New Jersey are asking Congress to strengthen the House-passed American Clean Energy and Security Act (ACES), despite several important ways in which ACES would largely displace state regulation of climate change. They accept some of these limitations on state power, but argue strongly for preserving their often pathbreaking roles in devising strategies to combat climate change.

Not surprisingly, the AGs first order of business is to tell Congress how important it is that any federal climate law enacted preserve state authority to regulate greenhouse gas emissions generally. They specifically argue that they should have the right -- recognized in the House bill -- to regulate greenhouse gases more stringently than federal law requires. The AGs have a good point. The states have been out ahead of the feds on climate change for the past decade and that alone ought to demonstrate the wisdom of preserving state regulatory authority. States can regulate in areas not addressed by the federal government, provide federal regulators with the results of their experience with different regulatory approaches and tools and enforce the law against violators who have escaped the federal government’s radar. Perhaps most importantly, the AGs want to ensure that they will have the right to regulate more stringently than their federal counterparts, a right they have under just about every other environmental law and one which enables more ambitious states to move ahead more aggressively against climate change without taking the entire nation with them.

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Waxman-Markey: State and Regional Cap-and-Trade Regimes

Perhaps one of the most-watched issues regarding federal climate legislation is how a cap-and-trade program established by such legislation would mesh with the existing and soon-to-be established state and regional greenhouse gas emission cap-and-trade programs. Currently, the United States has one regional cap-and-trade program up and running -- the Regional Greenhouse Gas Initiative (RGGI), which covers ten northeastern and mid-Atlantic states -- and several more in the offing. The latter include trading programs under development by California to implement 2006 state climate change legislation, AB 32, as well as a regional program called the Western Climate Initiative uniting seven states (including California) and four Canadian provinces, and a not-so-far advanced Midwest Greenhouse Gas Reduction Accord entered into in 2007 by six states and one Canadian province. Full text