States, energy companies and business groups are preparing to sue the Obama administration over its new climate rule, viewing it as their bet shot at stopping the regulations while President Obama is still in office.
With Congress largely powerless to stop the rule, opponents of Obama’s push say the court system is their only hope at beating back the carbon limits until a new president is in the Oval Office in 2017.
“That is the most viable pathway by which the rule will be stopped during the Obama administration, because whatever the Congress does, he could veto,” said William Yeatman, a senior fellow at the conservative Competitive Enterprise Institute.
Given the high stakes of the fight, the litigants are nearly certain to appeal the case all the way to the Supreme Court.
More than a dozen states joined energy interests earlier this year in an attempt to block the proposed carbon limits for power plants. While that effort failed, the dry run helped the litigants sharpen their arguments for the bigger battle to come.
Their arguments will rest on whether the Environmental Protection Agency’s (EPA) actions fall in line with the Clean Air Act and the Constitution.
Opponents of the rule believe strongly that the EPA stepped out of line, while the agency and its allies are confident that the courts will uphold it as a lawful use of executive power.
“I do believe the rule, as finalized, suffers from a number of legal infirmities,” said Yeatman, whose group is likely to join the litigation on behalf of the challengers.
Sixteen states and the National Mining Association have formally asked the EPA to delay implementation of the rule while the courts consider arguments, which could stretch for years.
They are soon likely to ask the Court of Appeals for the District of Columbia Circuit to immediately stop the EPA from implementing the rules. For that to happen, the litigants will have to prove they will suffer irreparable harm without such a stay, and that they are likely to win the case.
The legal arguments against the rule generally fall into three categories: That the EPA is violating constitutional limits on federal power; that the Clean Air Act prohibits “double regulation” on power plants whose other emissions are already regulated under another section of the law; and that the EPA lacks authority to regulate parts of the electric grid that are outside of power plants.
The constitutional argument has been made most forcefully by Laurence Tribe, a Harvard University law professor who once mentored President Obama and who has worked for Peabody Energy Corporation.
“Burning the Constitution of the United States, about which I care deeply, cannot be part of our national energy policy,” Tribe told the House earlier this year.
He later made similar arguments to the Court of Appeals for the District of Columbia Circuit.
Defenders of the rule say that the constitutional claims have little impact on court proceedings, which more often rely on interpretations of statute.
“I think those arguments have not been made to persuade the court; they’ll be made to help the political process,” said Richard Revesz, director of the Institute for Policy Integrity at the New York University School of Law. “They just allow Sen. [Mitch] McConnell [R-Ky.] to tell governors that a liberal authority like Larry Tribe is on their side.”
The argument over “double regulation” meanwhile, was central to the coal mining company Murray Energy Corporation’s preemptive challenge of the rule.
When Congress last updated the Clean Air Act in 1990, the Senate passed an amendment to prohibit regulating the same emissions from the same sources using two provisions in the law. But a separate House amendment appears to prohibit regulating any two kinds of pollutants from the same sources, which would render the carbon rules illegal.
Strangely, both versions were passed and signed into law, a phenomenon that has been referred to as a “glitch.” In 2012, the EPA put into place rules limiting emissions of mercury and other toxic air pollutants from power plants.
“By the plain terms of the Clean Air Act, as interpreted by the Supreme Court and by EPA itself, this action foreclosed EPA from mandating state-by-state emission standards for these same sources,” Murray told the D.C. Circuit Court.
The EPA says that the House version can be reasonably interpreted to allow the carbon rules. It argues that the law only prohibited double regulation of hazardous pollutants like mercury.
“The government just has a much more sensible argument on its authority,” said Jody Freeman, a Harvard University law professor who once worked in the White House under Obama.
“It makes eminent sense,” she said of the EPA’s interpretation.
Still, opponents in Congress and across the country have stuck to the double regulation issue, seeing it as one of their most powerful arguments.
Lastly, opponents have attacked the sweeping nature of the rule. The EPA set its emissions standards for each state based, in part, on adding renewable energy or other low-emitting forms of power to the electric grid, replacing higher-emitting options like coal.
States say that the Clean Air Act does not allow such “beyond the fenceline” regulations.
“This final rule adopts a radical, unprecedented regime, transforming EPA from an environmental regulator into a central planning authority for electricity generation,” West Virginia Attorney General Patrick Morrisey, who is leading a fight against the rules by 16 states, said in a statement.
In a formal request to delay the rule, Morrisey called the approach “novel” and “unlawful in numerous respects.”
Again, the EPA foresaw the argument and tried to preempt it, saying in its regulation that it is completely reasonable to look at entire electrical grids for regulatory purposes.
“It’s completely economically right and from an engineering perspective right to see the industry as able to do these things across the grid,” Freeman said.