Tuesday evening, while all eyes were focused on New Hampshire, the Supreme Court issued a surprising order. By a 5-4 vote, the Court granted a stay stopping the implementation and enforcement of the Obama Administration’s central climate policy initiative, the Environmental Protection Agency’s Clean Power Plan. Under the Court’s order the CPP is dead in the water until the resolution of various legal challenges currently pending in the U.S. Court of Appeals for the D.C. Circuit.
The Supreme Court’s decision to stay the rule was surprising because the Court rarely stays agency actions, particularly when a lower court has denied a litigant’s stay request, as happened here. But the CPP is not the ordinary regulatory action, so there’s no reason to think that the regular rules would apply. The CPP represents the most ambitious and audacious effort yet to control greenhouse gas emissions. In other words, insofar as the Court’s decision to grant a stay was unprecedented, perhaps it was prompted by the unprecedented nature of the CPP.
By the EPA’s own account, the rule could fundamentally transform the entire energy sector of the U.S. economy. It also rests on questionable legal authority. Among other things, it is not clear that the Clean Air Act authorizes the EPA to impose the sorts of GHG emission limits the CPP anticipates. And even if the EPA does have the authority to demand emission reductions from existing power plants, as the CPP would require, there are serious legal questions about the level of reductions the EPA seeks and whether the agency adequately followed the relevant procedural requirements in issuing the rule. (For more detail on the CPP and the relevant legal arguments, see this post at the Volokh Conspiracy.]
The Court’s decision to grant a stay does not necessarily mean that a majority of the justices are ready to reject the EPA’s rules, though it does suggest that a majority of the Court takes the challengers’ arguments quite seriously. It may also be the case that the Court wanted to prevent a repeat of what occurred with last year’s big environmental decision, Michigan v. EPA. In Michigan, the Court struck down an EPA regulation because the agency failed to consider the costs of its rule. No matter, the EPA replied. The mere threat of the rule — and the lack of a stay during the litigation — induced most of the regulated community to comply in advance. So the EPA got the benefit of the regulation even though it was unlawful. Insofar as the EPA was again suggesting that states and utilities should begin to comply with the CPP’s requirements well in advance of any applicable deadlines, the Court may have sensed some deja vu.
Whatever the reason, the Supreme Court’s stay means that the CPP won’t come into force unless and until courts have been convinced of its legality. The D.C. Circuit will hear oral arguments in June, so expect a decision in the fall, and there’s a high likelihood the Supreme Court will review whatever the D.C.Circuit decides.