Yesterday the U.S. Supreme Court held that the EPA can regulate carbon emissions for industries whose other pollutants are already regulated. That wasn’t a complete win, but it was mostly a win. (More)

SCOTUS Upholds Most Carbon Emission Limits

The headlines on yesterday’s ruling in Utility Air Regulatory Group v. EPA were … confusing. The New York Times headline read Justices Uphold Emission Limits on Big Industry, but Fox News tagged their story Supreme Court Limits EPA Global Warming Rules. The Washington Post ran with Supreme Court: EPA Can Regulate Greenhouse Gas Emissions, With Some Limits, while the American Prospect warned Supreme Court Hampers EPA on Greenhouse Gases But It Could Have Been Worse.

So what, exactly, did the Court decide? The decision is confusing, but the confusion is grounded in science rather than legalese.

How much is too much?

In the 2007 case Massachusetts v. EPA, the Court held that the EPA could regulate carbon dioxide and other greenhouse gases (together, GHGs) under the Clean Air Act. The EPA undertook the complex rule-making process and ran into a problem. Simply, GHGs are very different from other air pollutants.

When Congress write the Clean Air Act, their intent was to target big businesses that both put out most of the pollution and had the resources to comply with the regulatory requirements. So they wrote specific emission thresholds – 100 tons-per-year for specified pollutants and 250 tons-per-year for “any air pollutant” – below which facilities were exempt from regulation. Under those thresholds for other pollutants, and about 15,000 facilities are covered.

But the EPA estimated that 6.1 million facilities emit at least 250 tons-per-year of GHGs. Permit applications would leap from 800 per year to over 80,000, the EPA’s administrative costs would rise from $62 million to over $21 billion, and businesses seeking permits would face permitting costs of $147 billion. Such a scope and impact was, the EPA argued, far above what Congress anticipated when they wrote the 250 tons-per-year threshold into the Clean Air Act.

So the EPA wrote a new threshold for greenhouse gases. Under the new rules, any facility that met the lower levels for previously-defined pollutants – or emitted at least 100,000 tons-per-year of GHGs – would have to go through the EPA permit process and use “best available control technology” to limit its emissions.

Who decides?

The Court 5-4 held that the EPA lacked the statutory authority to adopt the new 100,000 tons-per-year threshold for GHGs. They held that Congress used the ambiguous phrase “any air pollutant” for good reason: to allow the EPA to include new pollutants if science found them to pose environmental and/or public health risks. But the 250 tons-per-year threshold was not ambiguous, the Court held, and the EPA couldn’t write a new threshold on their own.

Justices Breyer, Ginsburg, Sotomayor, and Kagan dissented and would have upheld the EPA’s 100,000 tons-per-year threshold for GHGs.

But the Court agreed that Congress never intended the EPA to spend $62 billion and impose $147 billion in costs trying to regulate the estimated 6.1 million facilities that produce at least 250 tons-per-year of GHGs. Still, the Court affirmed their holding in Massachusetts v. EPA that the EPA could regulate GHGs under the Clean Air Act, and held 7-2 that if a facility would already be regulated for other Clean Air Act pollutants – at the lower statutory thresholds – the EPA could also require those facilities to use “best available control technology” to limit their GHG emissions.

Justices Thomas and Alito dissented and would have reversed Massachusetts v. EPA, denying the EPA any authority to regulate GHGs.

An 83% win

As it happens, 83% of GHG emissions in the U.S. are from facilities that are already regulated for other pollutants. So yes, the Court upheld “most” GHG emission limits … provided the EPA’s “best available control technology” is not unduly burdensome. That will decided on a case-by-case basis, examining the GHG emissions of each facility, and how those emissions might be limited. The “best available control technology” guidelines will be refined in light of experience as well as emerging technologies that enable new and better GHG limits.

So that’s what the Court held yesterday. It wasn’t an environmental home run; the EPA cannot regulate facilities that emit hundreds of thousands of tons of GHGs but fall below the statutory threshold for other pollutants. But there aren’t too many such businesses, and the regulations will reach 83% of the problem.

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Happy Tuesday!