Regulation of greenhouse gas (GHG) emissions should be left to the Environmental Protection Agency (EPA), not federal courts, according to the United States Supreme Court, which on Monday threw out a lawsuit brought by eight states against five of the largest U.S. utilities over their carbon dioxide (CO2) emissions.
"It is altogether fitting that Congress designated an expert agency...EPA, as best suited to serve as primary regulator of greenhouse gas emissions," the court said in an opinion written by Justice Ruth Bader Ginsburg. "The expert agency is surely better equipped to do the job than individual district judges issuing ad hoc, case-by-case injunctions. Federal judges lack the scientific, economic and technological resources an agency can utilize in coping with issues of this order."
In December the Supreme Court agreed to review a Second Circuit Court of Appeals ruling that reinstated a lawsuit brought by California, Connecticut, Iowa, New Jersey, New York, Rhode Island, Vermont and Wisconsin -- and later joined by New York City and three land trusts -- in 2004 (see Power Market Today, Dec. 7, 2010). The group argued that GHG emissions from American Electric Power (AEP), Southern, Xcel Energy, Cinergy Corp. (now Duke Corp.) and the Tennessee Valley Authority public power system were a public nuisance that caused irreparable harm to property. The lawsuit sought emissions reductions by the utilities.
The defendants argued that the federal courts had never recognized an argument in common law that GHG emissions contributed to global warming. Instead, they said that if actions were to be taken, Congress should do it. A U.S. District Court agreed and said the issues demonstrated the "transcendentally legislative nature" of the case. The court found in favor of the defendants and tossed the lawsuit, which was subsequently reinstated by the Second Circuit Court of Appeals.
The Supreme Court by an 8-0 vote rejected the Second Circuit Court decision.
"The critical point is that Congress delegated to EPA the decision whether and how to regulate CO2 emissions from power plants; the delegation displaces federal common law," according to the Supreme Court decision.
The court did not rule on the plaintiffs' state nuisance law claims, saying those claims should be addressed by lower courts.
The Supreme Court decision comes less than six months after EPA issued its plan to regulate GHG pollution under the Clean Air Act for fossil fuel power plants and petroleum refineries, two of the largest sources of GHG emissions in the United States (see Power Market Today, Dec. 27, 2010). EPA recently extended until Sept. 30 the deadline for proposing GHG standards for fossil fuel power plants, giving older less-efficient coal-fired plants a temporary reprieve, but said it remains on schedule to meet a May 2012 deadline for final standards (see Daily GPI, June 15).
AEP recently said it would spend $6-8 billion by the end of the decade to retire nearly 6,000 MW of coal-fueled power generation and other actions in an effort to comply with a series of regulations proposed by EPA (see Daily GPI, June 13). The economic impact of proposed EPA regulations "will extend far beyond direct employment at power plants" and could include 10-35% electricity price increases for businesses, said AEP CEO Michael Morris.
EPA on Tuesday said it was extending by 30 days the timeline for public input on proposed mercury and air toxics standards -- but was not altering the timeline for issuing final standards -- in response to requests from members of Congress and to encourage more public comment. Those rules, which were proposed by EPA in March, would reduce emissions from new and existing coal- and oil-fired electric utility steam generating units. EPA remains on schedule to put the rules into effect in November, according to EPA Administrator Lisa Jackson.
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