The DC Circuit Court Should Uphold the Clean Power Plan

Today a federal appeals court heard arguments on the cornerstone of the U.S. nationally determined contribution

Near-term global climate action is paramount to reaching the goal set out by the Paris Agreement of limiting global temperature increases to well below 2°C. Specifically, the Paris Agreement invites all Parties to put forward their Intended Nationally Determined Contributions (INDC) towards achieving the objective of the Convention, and calls on each Party to prepare successive NDCs every five years that reflect its highest possible ambition towards these ends. Nearly all countries, including the United States, have now communicated their INDCs. And with more than 55 countries representing 47 percent of emissions already ratifying the Agreement, indicating their legal commitment to abide by its obligations, the Paris Agreement is on the threshold of entering into force. Press reports suggest the Agreement could take effect by October 7th—the deadline for the Agreement to be in force by COP22 in Marrakech.

A significant emitter of greenhouse gases (GHG), the United States has played an important role in causing man-made climate change, and must play an important role in the solution. This includes: finding workable strategies to make good on its intended NDC to reduce its economy-wide GHG emissions by 26-28 percent below 2005 levels by 2025; realizing its commitment to provide financial support for mitigation and adaptation in developing countries; and helping to define and enforce transparency provisions that will allow for sufficient tracking and evaluation of progress worldwide. The U.S. government is advancing along each of these tracks.

In terms of climate mitigation, the U.S. NDC highlights plans to regulate carbon pollution from existing power plants, the largest domestic source of GHG emissions. To do so, the U.S. Environmental Protection Agency’s (EPA) final carbon pollution emission guidelines for existing electric utility generating units (Clean Power Plan) makes use of the existing Clean Air Act, an Act the Supreme Court has said provides authority to regulate power plants. Specifically, in Massachusetts v. EPA (2007) the Supreme Court held that the Clean Air Act authorizes EPA to regulate GHGs, and in American Electric Power v. Connecticut (2011), the Supreme Court held that Section 111(d) of the Clean Air Act “speaks directly” to emissions of carbon dioxide from existing fossil fuel-fired power plants.

An en banc panel of judges at the D.C. Circuit Court of Appeals heard oral arguments today on the legality of the Clean Power Plan. A D.C. Circuit Court decision is expected either in late 2016 or early 2017. The decision could then be appealed to the Supreme Court should the Supreme Court decide to hear the case.

The standards set out in the Clean Power Plan are reasonable, achievable, and reflect the pre-existing trend in the power sector away from high-polluting sources toward lower-polluting sources and renewables. If upheld by the courts, EPA’s guidelines will achieve meaningful emissions reductions from fossil fuel-fired electric power plants. Using states as laboratories, EPA’s guidelines are premised on the best system of emission reduction, including unit-level efficiency improvements as well as shifts in power plant operations that have resulted from renewable portfolio standards and other common state policies. Ignoring successful state approaches would result in a sub-par outcome that is well shy of “best” from a climate standpoint. Moreover, featuring long lead times and flexible compliance options, EPA’s guidelines appropriately consider cost, reliability and the remaining useful life of existing units. We are confident that the Clean Power Plan will be upheld by the courts and granted the deference afforded federal agencies under Chevron v. NRDC (1984).

A decision upholding EPA’s guidelines will trigger planning exercises and stakeholder engagement that will help U.S. states identify regulatory designs and methods likely to work best in their unique contexts, and will also provide certainty to electric utilities, utility commissions and reliability councils charged with directing future electric system investments. A decision to uphold EPA’s guidelines will also reassure the international community that the U.S. has the tools it requires to make good on its commitments towards our shared international climate change goals.