On Tuesday, February 9, 2016, only a few weeks after the U.S. Court of Appeals for the District of Columbia Circuit denied a multistate plea to stop the U.S. EPA’s Clean Power Plan, the United States Supreme Court issued a highly unusual judicial stay on the EPA’s implementation of the Clean Power Plan.  This means that, short of the Supreme Court lifting its stay, the EPA will be barred from implementing the Clean Power Plan until:  (1) the D.C. Circuit Court takes up the matter in June and (2) all appeals to the Supreme Court have been exhausted.  This decision broke along expected lines, with the majority of five being Chief Justice Roberts and Justices Scalia, Kennedy, Thomas and Alito; the minority was composed of Justices Ginsburg, Breyer, Sotomayor and Kagan.

Similarly, the reactions to the stay have differed, with certain stakeholders reacting with disappointment and others, particularly the states and groups asking for the stay, praising the Supreme Court’s action.  For instance, the EPA has responded by stating that “We’re disappointed the rule has been stayed, but you can’t stay climate change and you can’t stay climate action.  We believe strongly in this rule and we will continue working with our partners to address carbon pollution.” 

Ross Macfarlane of Climate Solutions (a Pacific Norwest-based clean economy organization) said of the judicial stay “while the state of the CPP is cloudy, the fate of coal is clear as government policy, organizations and investors are increasingly moving to clean energy.”  Opponents of the CPP responded in praise of the stay: “Make no mistake, this is a great victory for West Virginia.  We are thrilled that the Supreme Court realized the rule’s immediate impact and froze its implementation, protecting workers and saving countless dollars as our fight against its legality continues,” stated West Virginia Attorney General Patrick Morrisey.   

The Clean Power Plan and Implementation by the States

A central element to President Obama’s climate change policies, and likewise important to the United States’ obligations under the UN Framework Convention on Climate Change (UNFCCC), also known as the Paris Agreement, the Clean Power Plan requires all covered power plants to slash their carbon emissions by 32% by 2030 from 2005 levels.  Further, affected states would be required to (1) submit their implementation plans by 2018 and (2) start showing emissions reductions by 2022.  

Challengers to the Clean Power Plan assert that the EPA lacks the authority under Section 111 of the Clean Air Act and that the EPA is attempting to reorganize the electric power sector in the United States in order to reduce emissions.  In turn, the EPA and its backers asserted that the EPA has the authority to implement the CPP and that it had used Section 111 of the CAA to seek reductions in coal-fired power generation and to encourage the use of more renewable energy.   

The Supreme Court’s stay places many states in limbo.  States may question the efficacy of moving forward with implementation plans when the status of the Clean Power Plan is uncertain.  As noted by the EPA in briefing, the stay of the litigation would serve to toll the deadlines in the Clean Power Plan.  States who support the Clean Power Plan may move forward with developing carbon reduction plans on their own initiative despite the stay, as the chair of California’s Air Resources Board has announced California will do. 

Expected Next Steps

What is next?  A hearing is scheduled for June 2, 2016 at the D.C. Circuit Court, which had declined to issue a stay on the Clean Power Plan in January.  Regardless of the D.C. Circuit's ruling, the case will likely be appealed to the Supreme Court, where according to Alexandra Bromer, a partner at Perkins Coie’s Washington, D.C. office, the Clean Power Plan’s fate will likely rest on the Supreme Court’s deference to the EPA’s interpretation of the law:  “Although the judicial stay does not directly address the merits of the underlying dispute, yesterday’s remarkable action by the Supreme Court suggests that at least five of the Justices may be skeptical of the EPA’s authority to implement the Clean Power Plan.”

The challengers’ cases are:   West Virginia et al. v. EPA, case number 15A773, Basin Electric Power Cooperative et al. v. EPA, case number 15A776, Murray Energy v. EPA, case number 15A776, Chamber of Commerce et al. v. EPA, case number 15A787 and North Dakota v. EPA, case number 15A793, all in the U.S. Supreme Court.

© 2016 Perkins Coie LLP