Yesterday, the Supreme Court heard oral arguments in its third case related to greenhouse gas emissions in seven years. How will the court's decision affect the future of air regulations coming out of U.S. EPA? During today's OnPoint, Richard Revesz, director of the Institute for Policy Integrity at the New York University School of Law, discusses the arguments and potential outcomes in the case. He also explains its significance in the context of the broader discussion on EPA's ability to regulate greenhouse gas emissions.
Monica Trauzzi: Hello and welcome to OnPoint. I'm Monica Trauzzi. Joining me today is Richard Revesz, director of the Institute for Policy Integrity at New York University's School of Law. Ricky, thanks for coming back on the show.
Richard Revesz: I'm delighted.
Monica Trauzzi: Ricky, yesterday the Supreme Court heard oral arguments in a case concerning EPA's ability to regulate greenhouse gas emissions from stationary sources. You were present at the arguments. What were your key takeaways and impressions of the line of questioning that you heard from the justices?
Richard Revesz: I thought the government did a very good job pointing out that the interpretation that EPA had taken in this case was a consistent interpretation taken over 30 years by administrations of both political parties, interpreting the term "any air pollutant" under this provision of the Clean Air Act to not exclude certain categories of pollutants. I thought that came across very clearly. It was also interesting that the industry, the main industry lawyer, Peter Keisler, indicated that EPA clearly had the authority to regulate the greenhouse gas emissions of new power plants, which is a regulation that EPA has proposed, so it's not really about that. And therefore the case was focused on this rather narrow area of the provisions of the Prevention of Significant Deterioration program of the Clean Air Act. It was clear this case was not about broader issues involving EPA's ability to regulate greenhouse gases, which EPA clearly has that authority and industry conceded that.
Monica Trauzzi: And the more narrow the case stays, the better it really is for EPA, right? I mean, was there any indication that the court might make it less narrow?
Richard Revesz: I don't think so. It is a fairly narrow case. Now the fact that it's narrow doesn't mean it's not important. I mean, it is an important case because it affects the question of when these greenhouse gas emissions are going to be regulated. Are we going to have to wait until EPA sets new source standards for first power plants and then other categories of sources, or are they going to be regulated immediately whenever a new source wants to begin operations or an existing source gets modified? I think what was interesting around this question of the scope of the case is that the industry groups were not able to put together a consistent interpretation of the statutes supporting them. There were multiple interpretations, and the court really struggled with how to decide this case where what needs to be done is, it needs to interpret a particular provision. It needs to decide what that provision means. And the industry groups put forward a number of conflicting interpretations in their briefs and had some trouble defending a common interpretation in the oral argument.
Monica Trauzzi: Did the justices cast any doubt on EPA's ability to proceed with the regulation of greenhouse gases?
Richard Revesz: Generally?
Monica Trauzzi: Yeah.
Richard Revesz: No, not at all. I mean, in fact the chief justice noted that he had been in dissent in Massachusetts v. EPA, which was a case that held that greenhouse gases are air pollutants and got us started down this regulatory path under the Clean Air Act, but that despite having been in the minority, that was the law of the land. And also the Supreme Court has subsequently decided another case, the American Electric Power case, where it held that EPA has the authority to regulate the greenhouse gas emissions of stationary sources, so not only mobile sources which were at issue in Massachusetts v. EPA, but also stationary sources, which were at issue now. I think the justices were not interested at all in any broad argument to revisit that question. This case was really only about these particular permitting provisions of PSD.
Monica Trauzzi: So moving forward, what are the possible outcomes here?
Richard Revesz: Well, there, too, the government wins and its regulation gets upheld, or the regulation gets remanded. Now there wasn't a clear path under which the government would lose. I mean, the government could conceivably lose, although my sense is that it won't. But the industry groups and the states that were on the side of the industry groups did not give the court a clear, consistent path to get there. As I mentioned a few minutes ago, there were multiple paths that were inconsistent. So basically the regulation either will be upheld or it could be, the case could be remanded back to EPA for looking at the issue again in light of whatever it is the court decides.
Monica Trauzzi: So how is the case significant in the context of the broader discussion on EPA's ability and willingness to move forward on regulation of greenhouse gases?
Richard Revesz: In two ways. First there's an important timing question. If EPA wins this case, it can regulate the greenhouse gas emissions of any new source or source that wants to modify its operations when those sources emit greenhouse gases, and it can do so right away. If EPA loses, it will still be able to regulate these emissions, but it will have to wait until it has set a categorical standard for that category of sources under Section 111 of the Clean Air Act. That's going to happen rather soon for power plants, but it will take years for EPA to do this category by category for all the relevant categories. So it's an important question around the timing. Does this happen sooner or does it happen later? And climate change is a pressing problem, and the longer it remains unattended, the worse it will be. That's one way in which this case makes a difference. The second way is that under the PSD program new and modified sources have to meet a standard called Best Available Control Technology. That standard has to be at least as stringent as the New Source Performance Standards under Section 111. Once EPA has set these New Source Performance Standards, they become a floor to BACT, but they are not identical to BACT. So Congress anticipated that Best Available Control Technology could on a case-by-case basis be more stringent than BACT, and that is at issue with this case as well. So first it's a timing question until we have New Source Performance Standards, and once we have them, this case matters because we might end up with standards under this provision that are more stringent than New Source Performance Standards. And Congress intended that that possibility be out there.
Monica Trauzzi: This is the third case in the last seven years on greenhouse gases and the Clean Air Act. What does the case tell us about the potential for the court to take up future cases that relate to greenhouse gas emissions and the Clean Air Act?
Richard Revesz: It's hard to predict. I mean, the court has obviously taken an interest in this area. The regulation of greenhouse gases is complex, and this case illustrates one such complexity, in this case that many more sources would be governed by, many more sources emit greenhouse gases ... carbon dioxide than almost any other pollutant. So EPA will have to make decisions and exercise its discretion in various ways as it moves forward regulating greenhouse gases under the Clean Air Act. And my guess is that we should expect that from time to time, every few years, the court will grant cert on a case to give guidance on the scope of that authority.
Monica Trauzzi: All right, we're going to end it right there. Thank you for coming on the show again.
Richard Revesz: Thank you.
Monica Trauzzi: And thanks for watching. We'll see you back here tomorrow. Wonderful job. Thank you.
Richard Revesz: Thanks. Thank you.
Monica Trauzzi: I appreciate it.
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