March 17, 2016 | General

BioEnergy Outlook: Supreme Court V. Clean Power Plan

Ted Niblock

Ted Niblock
BioCycle March/April 2016

On February 9, 2016, the U.S. Supreme Court halted implementation of the U.S. EPA’s Clean Power Plan (CPP), a set of new regulations designed to cut the amount of carbon dioxide emitted from the nation’s electric generation system (see “Biogas And The Clean Power Plan,” January 2016). Supreme Court orders of this kind, known as a “stay,” are unsigned and unexplained, but there are some obvious and important conclusions to be drawn. Before doing that, it helps to understand what all these legal hieroglyphics mean.
The several legal challenges to the CPP are being heard together in the DC Circuit Court of Appeals, which is where most suits against the EPA are filed. The challengers asked the DC Circuit to halt the CPP while the challenge was litigated, but the court refused. The Supreme Court overruled that decision and granted the stay, but the case continues to be litigated before the DC Circuit.
When a court grants a stay, it is temporarily stopping something from happening while it determines if that thing can, in the end, legally happen. Stays are best understood in the simple example of a criminal sentence. In the case where a defendant has been convicted of a crime by a trial court, but the issues on appeal are serious and there is a good chance that the conviction will be overturned, the appeals court reviewing the issue can “stay” the sentence, and allow the defendant to postpone going to prison while the appeal is heard.
As that example illustrates, the two key criteria for granting a stay are the court’s feelings as to the likely outcome of its final decision, and the harm that will come from leaving the current situation in place while it decides.
Confusingly, an order for a stay is not, officially, a ruling on the merits of the case (i.e., who deserves to win in the end). The Supreme Court order granting the stay in the CPP case was one half-page long, and contained no comment on the merits. But the stay itself indicates how the court feels about the ultimate outcome. Since a ruling is a balance of the two criteria, if one argument seems weak than the other is probably stronger. For example, a stay of execution for a death row inmate might not indicate a very strong argument on the merits, but be based mostly on the fact that a death sentence is about as irreparable as it gets.
This is important in the case of the CPP, because the argument for irreparable harm is not very persuasive. The only near deadline facing the states is to develop their plans to comply. That deadline is in September 2016 but extendable. Compliance doesn’t need to start until 2022 and can finish as late as 2030. Almost half of U.S. states are not challenging the plan, and those that are challenging are also developing plans to comply. While lead times for bringing new power generation online are long, eight years to even begin the process is a long time. The DC Circuit has put the case on an expedited schedule, with a hearing set for June 2 and decision by the fall. Even factoring in the case going back to the Supreme Court in its next session, the merits of the CPP can be decided within a year.

Reading The Tea Leaves

All of this indicates that the Supreme Court was very confident it would eventually strike down the CPP on the merits. Leaving aside for a moment the fact that the fifth vote for the stay was the late Justice Scalia, what are the merits?
First, the CPP is not a law. It is a regulation, issued by the EPA, using authority granted to it by a law, the Clean Air Act. The U.S. has not passed major environmental laws, or even significant amendments, in decades, so the EPA has been forced to address serious changes in technology and new threats to the environment without new laws to guide it. The Clean Air Act was passed in the 1970s, and the last significant update, which governs much of the current case, was passed in 1990.
There is a complex legal jujitsu by which parties sue the EPA, but the short version of the case before the DC Circuit is whether the EPA exceeded its authority. In defense of the EPA’s choices about what authority it has, imagine parents leaving a 7-year old child with a babysitter and having still not returned by the junior prom. How would that babysitter exercise authority over a prom after-party? It is an ad hoc process at the best of times.
The EPA was instructed by the Supreme Court in 2005 to regulate carbon dioxide as an air pollutant. Ever since, it has tried to adapt its authority for regulating other air pollutants to control CO2 emissions. It is generally agreed that the CPP is an aggressive step, but critics are not helpful with real alternatives. Most energy lawyers agree that some version of the CPP will survive, but the EPA is going to have to water it down to avoid repeated legal challenges.
As noted, an unexpected factor in all this is the sudden passing of Justice Scalia, only days after the vote for this stay. The CPP was always going to need a Democratic President in the next term for it to survive, since it is an Executive Order that can be repealed. However, it now might also get help for further Supreme Court review if Justice Scalia is replaced by a nominee more sympathetic to the EPA and the agency’s efforts to create programs and policies to combat climate change.
For the time being, however, CPP implementation is at a standstill.
Ted Niblock develops biogas projects for NewAg Development.

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