In West Virginia v. EPA the U.S. Supreme Court held 6-3 that the Environmental Protection Agency (EPA) lacked the statutory authority to issue the Clean Power Plan (CPP).
Per the Clean Air Act, for new and existing powerplants EPA may come up with air-pollution standards which reflect “the best system of emission reduction” (BSER). Before the CPP when EPA regulated under this provision of the Clean Air Act it required existing powerplants to make technological changes—like adding a scrubber—to reduce pollution.
In the 2015 EPA released the Clean Power Plan which determined that the BSER to reduce carbon emissions from existing powerplants was “generation-shifting.” This entailed shifting electricity production from coal-fired power plants to natural-gas-fired plants and wind and solar energy. Operators could generation shift by reducing coal-fired production, buying or investing in wind farms or solar installations, or purchasing emission credits as part of a cap-and-trade regime. The goal of the CPP was to by 2030 have coal provide 27% of national electricity generation, down from 38% in 2014.
The Court, in an opinion written by Chief Justice Roberts, held that generation shifting exceeds EPA’s authority under the Clean Air Act because Congress didn’t give EPA “clear congressional authorization” to regulate in this matter. “As a matter of ‘definitional possibilities,’ generation shifting can be described as a ‘system’—’an aggregation or assemblage of objects united by some form of regular interaction’ capable of reducing emissions. But of course almost anything could constitute such a ‘system’; shorn of all context, the word is an empty vessel. Such a vague statutory grant is not close to the sort of clear authorization required by our precedents.”
EPA had to show it had “clear congressional authorization” to adopt the CPP because the Court applied the major questions doctrine. This doctrine applies, according to the Court, in “extraordinary cases”—cases in which the “history and the breadth of the authority that [the agency] has asserted,” and the “economic and political significance” of that assertion, provide a “reason to hesitate before concluding that Congress” meant to confer such authority.
The Court opined this is a major questions doctrine case because “[i]n arguing that [the relevant provision of the Clean Air Act] empowers it to substantially restructure the American energy market, EPA ‘claim[ed] to discover in a long-extant statute an unheralded power’ representing a ‘transformative expansion in [its] regulatory authority.’ It located that newfound power in the vague language of an ‘ancillary provision’ of the Act, one that was designed to function as a gap filler and had rarely been used in the preceding decades. And the Agency’s discovery allowed it to adopt a regulatory program that Congress had conspicuously and repeatedly declined to enact itself.”
Justices Kagan, Breyer, and Sotomayor dissented. They disagreed with the Court’s conclusion that this is a major questions case. They argue that “best system”— “full stop—no ifs, ands, or buts of any kind relevant here” is a broad Congressional authorization. “The parties do not dispute that generation shifting is indeed the ‘best system’—the most effective and efficient way to reduce power plants’ carbon dioxide emissions.” “A key reason Congress makes broad delegations like Section 111 [of the Clean Air Act] is so an agency can respond, appropriately and commensurately, to new and big problems. Congress knows what it doesn’t and can’t know when it drafts a statute; and Congress therefore gives an expert agency the power to address issues—even significant ones—as and when they arise.”