|The Morning After: Some Personal Thoughts on Yesterday's D.C. Circuit Greenhouse Gas Decision and the Future of EPA GHG Regulation|
|Monday, 09 July 2012 09:08|
There's no sugar-coating it. Yesterday's decision was an across-the-board smack-down for industry and the states that sought to overturn EPA's first foray into GHG regulation following the Supreme Court's 2007 Massachusetts v. EPA decision. Not only did the Court reject every argument petitioners made, the tone of the decision suggested real hostility.
I had personally grown pessimistic about our chances when the panel was appointed, but had thought there were arguments we could win and that we might get a good dissent from Judge Sentelle at least on the authority of EPA to "tailor" the statutory PSD permitting thresholds. Such a dissent would have enhanced the prospects of a motion for the full court to rehear the case en banc and a petition for certiorari to the Supreme Court.
In the end, we got nothing. Known as a bear on standing, Judge Sentelle did not dissent from the panel decision that none of the petitioners had standing to challenge EPA's tailoring of the statutory thresholds, since (in the panel's view) none are injured by EPA narrowing the class of sources subject to GHG regulation. Hence, petitioners' strongest argument and the most glaring legal defect of the rules never got decided on the merits. I don't think the Court correctly characterized industry petitioners' arguments as to standing and therefore never confronted those arguments head on, but by the time the opinion got around to that issue the overall direction the Court was going was clear.
Despite the disappointing decision yesterday, it would be well to remember that the real damage was done in the Supreme Court's 5-4 Massachusetts decision, where EPA was found to have authority to regulate GHGs under the CAA so long as it determined that GHGs endanger the public health and welfare. For someone like me, who has been involved in the issue of potential EPA regulation of GHGs under the CAA since the Clinton Administration (when then EPA Administrator Carol Browner casually mentioned in a House Committee hearing that the Senate didn't need to ratify the Kyoto Protocol in order for the country to regulate GHGs; EPA could do so under the CAA), the Massachusetts decision was a real travesty. It is impossible to review the history of the public debate on GHG regulation in this country beginning in the 1980s, when potential climate change first came to prominence, and conclude that authority to regulate GHGs was always available, hiding in plain sight in the CAA as first enacted in 1970. The Supreme Court said in the 2001 American Trucking Associations decision, in language that is often cited, that Congress does not "hide elephants in mouseholes." Evidently, in the case of EPA GHG regulation, Congress did.
I had two reactions to the Massachusetts decision that are still pertinent today. First, EPA regulation of GHGs is really concerning. Carbon dioxide is the inevitable byproduct of combusting fossil fuels (of oxidizing carbon). Fossil fuels constitute 85 percent of the energy Americans use. Hence, EPA authority to regulate carbon dioxide is essentially the authority to regulate everything.
The danger in EPA's authority to regulate GHGs is amplified by the fact that EPA's source of regulatory authority is the CAA. To trigger regulation under the CAA, EPA must make a finding that GHGs "may reasonably be anticipated to cause or contribute" to the endangerment of public health or welfare. We learned again from yesterday's decision what a permissive standard this is. At oral argument, one of Judge Sentelle's first statements to petitioners' counsel was something to the effect of "I hope you're not going to ask us to make a judgment on the science." Personally, I am a climate skeptic – I have read through the climategate emails and have been appalled. But the courts continue to show reluctance to truly engage EPA's science findings (or even to allocate sufficient words to adequately brief these highly technical issues).
And the concern about EPA GHG regulation does not just stem from the CAA's very permissive "endangerment" standard. The CAA programs under which EPA can regulate also grant EPA great discretionary authority in setting standards. Some CAA programs (the NAAQS, for instance) do not authorize consideration of costs; others do authorize consideration of costs but give EPA authority to weigh cost and environmental factors in its judgment.
To make matters worse, no matter what regulation EPA adopts, it will make no meaningful difference to overall global atmospheric GHG concentrations, as the developing world continues to develop and take advantage of fossil fuels. So the benefits of EPA GHG regulation will be all symbolic, while the costs may be immense as the country risks losing its ability to take advantage of what should be one of its great competitive strengths – abundant domestic supplies of fossil fuels.
Having said all that, my second reaction to Massachusetts, which I still have today, is that it is like being back in 1970, when Congress first enacted the CAA, all over again. Reflecting the mentality of that time (and the significant pollution problems this country had), the 1970 CAA mandated clean air in five years. It didn't happen, because the goal was unrealistic. What followed since 1970 has been a long hard continuing fight to balance the desire for clean air and the need to maintain the economy. There have been countless EPA rulemakings over the decades since 1970, most of which were appealed, many of which were upheld, and some of which were not.
That's where we are now with GHGs. We are going to get more or less GHG regulation over time depending on who is in the White House and whether the particular GHG regulations that EPA issues are legally defensible. Thus, each regulation is going to have to be attacked (or defended) on the merits. My own view is that EPA's latest GHG proposal, for new source performance standards for coal-based electric generation, is not legally defensible and will be overturned in Court. But there will be many more GHG regulations to come, and we are in for another long, hard rule-by-rule slog under the CAA, in this case to shape the timing and stringency of GHG regulation in this country.
Of course, as we move forward with more EPA GHG rulemaking, it matters critically who the President is. But even if Mitt Romney is elected President, he will find it very difficult to eliminate EPA GHG regulation completely. To do so, he would have to pull the endangerment finding, which would be difficult to accomplish both legally and politically. However, the discretion that the CAA gives EPA to fashion GHG regulations, while dangerous in the wrong hands, also presents an opportunity to an EPA Administrator who wishes to have a moderate approach to GHG regulation.
In the end, the most rational thing for the country to do on GHGs is for Congress to enact legislation that gets EPA out of the GHG regulatory business entirely. Even proponents of GHG regulation don't believe that the CAA is suited to that purpose. We must therefore keep pushing on the legislative front, since new legislation is the right thing to do. Still, the alignment of political forces is such at this time that comprehensive GHG legislation seems out of reach, although more targeted legislative approaches may be possible. Without some intercession from Congress, we are left with possibly decades of hand-to-hand combat on GHG regulation.
In sum, it would have been good if we had won yesterday and even better if we had gotten that fifth vote in Massachusetts (that is also likely to be the decisive vote in the health care decision tomorrow). We didn't. Petitioners will now at least ask the Supreme Court to take the case and may also seek rehearing en banc from the full panel. Absent the Supreme Court granting certiorari and reversing the panel decision, we will have broad EPA authority over GHG emissions under the CAA. If that is the case, there is nothing we can do but to continue fighting on a rule-by-rule basis with all the ammunition we have, political, legal, technical and scientific.