Appeals court rejects appeals of proposed version of EPA’s Clean Power Plan

The U.S. Circuit Court of Appeals for the D.C. Circuit, saying the U.S. Environmental Protection Agency’s proposed Clean Power Plan can’t be challenged until it is in final form (which is expected in August), on June 9 dismissed lawsuits filed by Ohio-based coal producer Murray Energy and attorneys general from 15 states.

The American Coalition for Clean Coal Electricity on June 9 expressed regret about the decision. The ruling impacted two separate lawsuits that challenged the legality of EPA’s proposed rules. The suits were brought by Murray Energy and a bipartisan coalition of attorneys general from 15 states, led by West Virginia, the nation’s number two coal producer. The plan calls for 30% greenhouse gas reductions by 2030 from existing power plants, with an interim compliance deadline in 2020 that alone is expected to cause the shutdown of dozens of coal-fired power plants.

“Although we wish the judges’ decision was different, we are not surprised and look forward to our next day in court. That the court even took a look at these suits before the rules were final was an unprecedented step and demonstrates that EPA’s regulatory overreach has caught the eye of the court,” said Mike Duncan, president and CEO of ACCCE, in the June 9 statement. “States and industry are already working to ensure that when the rule is final we are prepared to step-in and stop the implementation of these devastating regulations.”

The court ruling was not based on the merits of the EPA’s regulation, but rather solely on the question of whether a rule could be challenged before it was deemed final by the Obama Administration.

To date, officials from 32 states have said that EPA does not have the legal authority to regulate carbon emissions from coal-fired power plants under Section 111(d) of the Clean Air Act, the coalition noted. It said officials in 28 states have called for the outright withdrawal of EPA’s proposal.

Congress, with a Republican majority in both houses, is also looking into the legality issue. In March, the House Committee on Energy and Commerce’s Subcommittee on Energy and Power hosted a hearing to examine the issue. Testifying at the hearing was Laurence H. Tribe, professor of constitutional law at Harvard Law School and former law professor of President Barack Obama, who noted in a Wall Street Journal op-ed: “After studying the only legal basis offered for the EPA’s proposed rule, I concluded that the agency is asserting executive power far beyond its lawful authority.”

“EPA’s regulations will significantly increase electricity costs for those who can afford it the least,” Duncan said. “If the regulations are not going to be withdrawn by the agency, they must be thrown out by the courts. We are hopeful once the rule is final and we have a chance to argue the merits of the case a court will do just that; throw out EPA’s overreaching, calamitous plan.”

Court says it won’t ‘blaze’ any new trails here

Said the June 9 decision from a three-judge appeals court panel: “Petitioners are champing at the bit to challenge EPA’s anticipated rule restricting carbon dioxide emissions from existing power plants. But EPA has not yet issued a final rule. It has issued only a proposed rule. Petitioners nonetheless ask the Court to jump into the fray now. They want us to do something that they candidly acknowledge we have never done before: review the legality of a proposed rule. But a proposed rule is just a proposal. In justiciable cases, this Court has authority to review the legality of final agency rules. We do not have authority to review proposed agency rules. In short, we deny the petitions for review and the petition for a writ of prohibition because the complained-of agency action is not final.”

The ruling said by way of background: “Petitioners here are Murray Energy Corporation, which is a coal company whose business would be negatively affected by a restriction on carbon dioxide emissions from coal-fired power plants, and the States of West Virginia, Alabama, Indiana, Kansas, Kentucky, Louisiana, Nebraska, Ohio, Oklahoma, South Carolina, South Dakota, and Wyoming. Shortly after EPA issued its proposed rule, petitioners filed suit. According to petitioners, Section 111(d) of the Clean Air Act does not grant EPA authority to limit carbon dioxide emissions from existing power plants. For that reason, petitioners ask the Court to enjoin EPA from issuing a final rule limiting those carbon dioxide emissions.”

The appealing parties contended that the court should consider their challenge now because they are already incurring costs in preparing for the anticipated final rule. And the petitioners said that the court will not be able to fully remedy that injury if it does not hear the case at this time. “But courts have never reviewed proposed rules, notwithstanding the costs that parties may routinely incur in preparing for anticipated final rules,” said the court. “We recognize that prudent organizations and individuals may alter their behavior (and thereby incur costs) based on what they think is likely to come in the form of new regulations. But that reality has never been a justification for allowing courts to review proposed agency rules. We see no persuasive reason to blaze a new trail here.”

The Sierra Club said in a June 9 statemennt that it was a party to these cases, joining an array of others including Calpine Corp. (NYSE: CPN), one of the nation’s largest power producers, in supporting the Clean Power Plan. Joanne Spalding, Chief Climate Counsel at the Sierra Club, said: “Today the U.S. Court of Appeals roundly rejected the coal industry’s latest desperate attempt to block clean energy and climate action. Unfortunately, we will likely see more baseless lawsuits like this, but progress towards a clean energy economy, cleaner air and water, and healthier communities is inevitable.”

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.