What Chevron’s end could mean for EPA climate regulations

By Jean Chemnick | 06/26/2024 06:33 AM EDT

The Supreme Court is poised to weaken the Chevron doctrine and curtail agencies’ policymaking power.

Former EPA Administrator Andrew Wheeler testifying at the Virginia Legislature.

Former EPA Administrator Andrew Wheeler, shown testifying at the Virginia Legislature, hopes the Supreme Court undoes a long-standing environmental precedent this week. Steve Helberg/AP

Conservatives are hoping the Supreme Court strikes down a 40-year-old legal doctrine this week that has empowered agencies to write aggressive regulations on a wide range of topics including climate change.

The court is expected to issue a decision by Friday that weakens or eliminates its 1984 ruling that directed judges to defer to “reasonable” agency interpretations of ambiguous laws.

The so-called Chevron doctrine gives agencies leeway in interpreting statutes. Conservatives have said for years that it has enabled “unelected bureaucrats” to usurp Congress’ authority to make laws on issues including health care and carbon emissions.


In one well-known case, the Supreme Court relied on the Chevron doctrine in 2014 when it upheld EPA emissions reduction standards for 28 states whose air pollution crossed state lines and harmed downwind neighbors. Although the Clean Air Act is vague on the issue, the court ruled that EPA had reasonably interpreted its authority under the law.

It’s unclear how far the court’s conservative majority will go in its decision.

If the court takes an aggressive step and scuttles the Chevron doctrine, the ruling could make new regulations less ambitious by forcing agencies to consider how courts will interpret statutes that are vague or ambiguous.

“This is something that both progressives and conservatives should be concerned about, if the court is going to start being the policy arbiter,” said Stan Meiburg, a former EPA acting deputy administrator.

Some conservatives say a Supreme Court decision knocking down Chevron could upend EPA’s current climate strategy because it would make courts less apt to accept agency determinations that a judge finds dubious.

EPA’s final rule in April limiting emissions from power plants fueled by coal or natural gas “is incredibly legally vulnerable” if the Supreme Court weakens the Chevron defense, said Andrew Wheeler, who ran the agency under President Donald Trump.

“This is the case that several of the conservative justices on the Supreme Court have been waiting for — that is, I think, custom-made for justices who want to rein in or reverse Chevron,” Wheeler said in a recent “POLITICO Energy” podcast.

Wheeler said the Biden administration “should have waited” until after the court rules on Chevron to propose regulations that could force high-emitting power plants to cut emissions by 90 percent in eight years.

“If Biden is reelected, he’s going to have to redo that regulation anyway, because of [the] Chevron deference case coming out,” said Wheeler, who was an adviser to Virginia Gov. Glenn Youngkin (R) until March.

Jeff Holmstead, an EPA air chief under President George W. Bush and a partner at Bracewell, said a Supreme Court decision limiting or eliminating Chevron could prompt courts to scrutinize agency determinations more closely.

Under three presidents, EPA regulated carbon emissions through a Clean Air Act provision that requires agencies to identify a “best system of emissions reduction” for each category of pollution sources. A best system must be “adequately demonstrated” considering costs and factors such as pollution.

EPA does not require polluters to use the “best system.” Rather, they must reduce emissions to a level that could be achieved using the “best system.”

EPA’s new power plant rule makes carbon capture and storage the “best system.” That requires plants to make ambitious cuts equivalent to a CCS system that captures 90 percent of carbon emissions.

But there is currently only one commercial-scale coal plant operating in the U.S. with CCS — and no gas plants.

With only one CCS project in operation, Holmstead said, EPA would struggle to prove to a court that the technology is “adequately demonstrated.” And courts are unlikely to take EPA’s word for it.

“That’s an example of a case where the idea [is] that it’s not EPA defining what statutory terms mean, it’s the courts,” Holmstead said. “And I think it makes it pretty hard for EPA to argue that CCS has been adequately demonstrated considering costs and other energy impacts.”

Wheeler said the Supreme Court’s 2022 invalidation of the Obama-era Clean Power Plan should have signaled to the Biden administration that it couldn’t rely much on Chevron when writing the next round of power plant carbon rules.

Chevron doctrine fades from use

Environmental advocates are less focused on how the upcoming Supreme Court decision could affect climate regulations, which they say are on strong legal footing because they do not rely on the Chevron doctrine.

“The agency doesn’t do that anymore,” said David Doniger, a senior Natural Resources Defense Council attorney who argued the 1984 Supreme Court case that established the doctrine. “Instead, it spends a lot of time and words analyzing what the relevant statutes mean and what it thinks the singular or the best meaning of those terms is.”

The numerous Clean Air Act carbon and methane rules that have appeared in the Federal Register in recent months do not cite Chevron, likely because the Supreme Court’s hostility to the doctrine is well understood.

EPA has rarely cited Chevron to support its climate rules. And when it has, the Supreme Court has seldom agreed that the agency deserved deference.

In 2014, the court rejected the Obama administration’s expansive interpretation of the Clean Air Act in an attempt to regulate carbon emissions and the millions of sources including schools, small business and houses of worship.

EPA responded to the court’s decision by regulating carbon under a different section of the Clean Air Act that doesn’t specify emissions thresholds.

Under Bush, EPA used Chevron to defend its attempt to avoid imposing regulations on heat-trapping emissions. The Supreme Court rejected the administration’s effort. Its decision in Massachusetts v. EPA put the agency on course to regulate carbon under the landmark statute.

Noting the court’s hostility, agencies years ago stopped relying on Chevron deference in rulemaking. The court hasn’t upheld an EPA rule on the basis of Chevron since 2014, and it hasn’t relied on the doctrine in any decision since 2016.

“The point is that in both of those cases the agency didn’t get deference,” said Sanjay Narayan, chief appellate counsel for the Sierra Club. “Where we are today in the law is not dependent on Chevron because the court ruled against the agency in both of these instances.”

Doniger said legal challenges to EPA regulations would have to show that the agency’s scientific and technical conclusions are “so out of line with the factual record” as to warrant the court’s intervention.

In past decades, EPA and other agencies — in administrations of both parties — have frequently relied on Chevron deference in crafting regulations. Kevin Poloncarz and Katarina Resar Krasulova, attorneys for Covington & Burling, wrote in a recent Bloomberg Law article that the theory had figured in 77 Supreme Court cases and thousands of lower court decisions.

This week’s decision by the high court might not throw it out completely. It might simply raise the analytical bar for when agencies might deserve Chevron deference, requiring them to make a stronger case for why their policy decisions are faithful to the underlying statute.

Doniger said the impact of the court’s decision on the cases now before it — Relentless Inc. v. Department of Commerce and Loper Bright Enterprises v. Raimondo — would depend on its breadth. He said rules that don’t cite Chevron probably won’t be “automatically undercut” by a decision that overturns it — at least not in lower courts.

It started under President Reagan

Meiburg, the former acting EPA deputy administrator, said the Supreme Court could trigger “policy paralysis” by weakening Chevron and shifting policy design to courts from expert agencies.

Courts “are arguably the least accessible to public opinion of any of the three branches of government,” said Meiburg, now executive director of the Sabin Family Center for Environment and Sustainability at Wake Forest University.

It was the Reagan administration that benefited from the court’s 1984 decision in Chevron v. Natural Resources Defense Council.

The case arose out of a Reagan administration effort to limit emissions regulations by narrowly interpreting a Clean Air Act phrase.

The Reagan EPA defined “stationary sources of air pollution” as an entire industrial site rather than each individual pollution source on a site. The 1977 Clean Air Act amendments had not defined the term “stationary source.”

The EPA definition allowed facility owners to undertake projects that increased emissions in one part of the facility without triggering emissions reduction requirements — provided pollution from the whole facility stayed the same.

The Natural Resources Defense Council said EPA’s definition would exempt 90 percent of large industrial projects from pollution. It sued, arguing that each pollution source on a single site is subject to regulation.

The Supreme Court sided with EPA in a ruling aimed at forcing judges to defer to agency interpretations of law as long as they’re “reasonable.”

“The court in Chevron was reminding the judiciary not to try to substitute their policy judgments for those of agencies with more expertise,” said Meiburg, a career EPA official who was serving at EPA in 1984.

Holmstead, the former EPA official, said if the court narrows the deference afforded to agencies, “it could make Congress in some ways more relevant.”

“People actually have to engage in discussions about issues and compromise on things,” Holmstead said.

But Meiburg said curtailing agency deference wouldn’t make it easier for a polarized Congress to enact new laws.

“Congress in what universe?” he said. “Congress can’t even get budgets passed on time.”

“We haven’t seen a wholesale revision — with the exception of the Lautenberg Act — to any of the major environmental statutes since 1990,” Meiburg said, referring to a 2015 update to a chemicals law.