06.15.2015

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Updates

The U.S. Court of Appeals for the District of Columbia in In re: Murray Energy Corporation, on June 9, 2015, refused to review the Environmental Protection Agency’s Clean Power Plan.  The Clean Power Plan would require existing fossil fuel-fired power plants to significantly reduce their carbon dioxide emissions.  But at this point the plan is merely a proposed rule, so the court concluded that a challenge to it is premature.  In refusing to review the plan, the court reiterated a fundamental principle of administrative law: only final rules are subject to judicial review.  

The Clean Power Plan, as drafted, would require states to reduce their carbon dioxide emissions to achieve a national 30 percent reduction below 2005 levels by 2030.  States would have flexibility in deciding how to reduce their CO2 emissions.  But as a practical matter the reductions likely would require upgrading or closing aging facilities with outdated pollution-control technologies and bringing new clean (or cleaner) energy onto the grid.  In some states, it may be necessary to establish rigorous state-based renewable energy portfolios, carbon credit trading programs and/or demand-side energy efficiency programs. 

Challenging the Clean Power Plan

Whether the Clean Power Plan, once it is adopted, will sustain subsequent challenges remains unanswered.  In this inaugural challenge, coal corporations, 15 coal-producing states, trade groups and mining associations pleaded that EPA was overstepping the Clean Air Act’s authority, which we have previously discussed.  On the other side of the ledger, over a dozen states supported EPA’s Clean Power Plan.  

In its simplest form, the substantive question in In re: Murray Energy Corporation was whether the Clean Air Act gives EPA authority to enact the Clean Power Plan.  EPA has invoked its authority under Section 111(d) of the Clean Air Act, which authorizes the agency to set performance standards for existing sources.  But this section has seldom been used and Section 112 of the Clean Air Act already regulates air toxins at existing coal-fired power plants.  The Clean Air Act arguably prohibits “double regulation” of plant emissions under both Section 111(d) and Section 112.

The debate about the prudence and legality of the Clean Power Plan rages.  Indeed, since announcing its proposed rule last June, EPA has received over two million comments.  EPA plans to finalize its Clean Power Plan rules this summer.  Because the substantive issues laid out before the D.C. Circuit have not been resolved,  we expect lawsuits to roll in upon issuance of the final rules, with the question of “double regulation” appearing at the forefront.

© 2015 Perkins Coie LLP