Following the Supreme Court's decision to review U.S. EPA's use of the Clean Air Act to regulate greenhouse gas emissions, what are the possible impacts on the Obama administration's rollout of its Climate Action Plan? During today's OnPoint, Thomas Lorenzen, a partner at Dorsey & Whitney and the former assistant chief in the Environment and Natural Resources Division at the Department of Justice, discusses his views on the court's rationale for pursuing the case. He also talks about the broader implications of the court's move.
Monica Trauzzi: Hello, and welcome to OnPoint. I'm Monica Trauzzi. Joining me today is Thomas Lorenzen, a partner at Dorsey & Whitney and the former assistant chief in the Environment and Natural Resources Division at the Department of Justice. Tom, it's great to have you back on the show.
Thomas Lorenzen: Thank you for having me back.
Monica Trauzzi: Tom, EPA-related news coming out of the Supreme Court this week. The court granted a petition to hear a case regarding EPA's use of the Clean Air Act to regulate greenhouse gas emissions. Is the court indicating that the agency may have stretched its authority?
Thomas Lorenzen: They're concerned about that, but I don't think they have indicated strongly one way or another. This question, whether EPA permissibly determined that its regulation of greenhouse gas emissions from new cars triggered permitting requirements under the act for stationary sources, is a question the court hasn't grappled with before. They never touched this in Massachusetts v. EPA. That's a novel question.
Monica Trauzzi: So was this a surprise move by the court? I mean, was it ... gauge sort of the level of surprise when this decision came out yesterday.
Thomas Lorenzen: I was not surprised by this decision. The fact that they weren't able to decide after the long conference whether to take this case, the fact that they didn't announce following whether to take this case indicated that there was some debate within the court about whether to take the case at all, or if they were going to take it, whether to take it only narrowly. And they took it about as narrowly as you possibly could.
Monica Trauzzi: Right. And so you mentioned Massachusetts v. EPA. The court has ruled on related issues, both in the Mass. case and also the AEP case. Are they revisiting these prior decisions or sort of moving forward from those?
Thomas Lorenzen: I think they're moving forward. They had the opportunity here to revisit Massachusetts v. EPA. Many of the petitioners asked the court explicitly to revisit that case in light of how far they had seen EPA push PSD and Title V permitting and questioned again whether EPA really has this authority. The court declined that invitation.
Monica Trauzzi: This is being spawned by both sides, industry and environmentalists. Who do you consider this a win for?
Thomas Lorenzen: This is a win for everyone, and a bit of a loss for everyone. EPA appears to now have established that it has the authority under the Clean Air Act to regulate greenhouse gases. The court is not revisiting Massachusetts v. EPA. Industry gets to have the court visit the issue that they thought required Supreme Court review, which is does regulation of motor vehicle emissions of greenhouse gases automatically trigger stationary source regulation of greenhouse gases? EPA views this as a win because the way they read the court's cert. grant, it doesn't affect their authority to press ahead with their big deal, which is the pending regulations for power plant emissions.
Monica Trauzzi: And that's the big question here. I mean, the case does not speak specifically to those New Source Performance Standards, both the ones we've seen recently released for new power plants and the existing power plant proposals that we're anticipating. Does this in any way affect the rollout of these standards?
Thomas Lorenzen: EPA will say absolutely not. They will press forward with these things aggressively. They're on a tight deadline, as I think I said the last time I was here. President Obama wants this done before he leaves office. If the court had granted cert. more broadly, had revisited Massachusetts v. EPA, then I think EPA's authority to press ahead with those regulations would be substantially in doubt. But the court hasn't done that here. It is treating separate statutory authority, PSD and Title V, and what is conspicuously not before the court is EPA's authority under Section 111, which is New Source Performance Standards.
Monica Trauzzi: So then what's happening behind the scenes at EPA? I mean, are they worried at all? Are they rejiggering the timeline? Or are they just waiting to see what happens?
Thomas Lorenzen: Well, I think what's happening at EPA right now is they're waiting for the government to get going again.
Monica Trauzzi: Well, yes. [Laughter]
Thomas Lorenzen: No, they are -- they intend to press ahead with their listening sessions and developing these rules as soon as they are open for business again. I don't think they are going to wait for the Supreme Court to do something or adjust their schedules to accord with what the Supreme Court might do at the end of next term.
Monica Trauzzi: Can this in any way be seen as a court readiness barometer for NSPS? Or is that too much of a reach?
Thomas Lorenzen: Well, I think that the court has already established that NSPS is available. That's the import of the American Electric Power case where they said that states cannot bring these public nuisance suits based on the existence of EPA's New Source Performance Standards authority. For the court to go very broad in this case would require that they then revisit the AEP decision, and I don't think they're likely to go down that road.
Monica Trauzzi: Okay, we'll end it there -- a lot to watch. Thank you for coming on the show.
Thomas Lorenzen: Thank you so much for having me.
Monica Trauzzi: And thanks for watching. We'll see you back here tomorrow.
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