U.S. Energy and Environmental Policy and Law in the Making: The Clean Power Plan

It was a busy week for the United States and the Obama Administration’s Climate Change Initiative.

On October 23, 2015, the Clean Power Plan was published in the Federal Register, [subscribers can access an enhanced version of this rule: lexis.com | Lexis Advance]. This official act triggered the rush to the U.S. Court of Appeals for the D.C. Circuit, the federal court to which all national Clean Air Act rulemakings are appealed. Within minutes upon the posting of the Federal Register page for the final Clean Power Plan, stamped copies of Notices of Appeal were being circulated. The multi-state appeal led by West Virginia’s Attorney General Patrick Morrisey was the first to come across my desk. This appeal includes 24 states[1] who assert, “the final rule is in excess of the agency’s statutory authority, goes beyond the bounds set by the United States Constitution, and otherwise is arbitrary, capricious, an abuse of discretion and not in accordance with law.” Other appeals are beginning to stack up at the D.C. Circuit. On Friday, I was also privy to the early filing by a coalition of industry trade organizations let by the U.S. Chamber of Commerce. As both a Director on the Board and the Chair of the Energy, Clean Air, and Natural Resource Committee of the U.S. Chamber, I can report they take very seriously the import of the final Clean Power Plan. Industry Petitioners have requested the rule be set aside.

In short, the Clean Power Plan is a carbon diet for the nation. At issue is whether the plan fits within the current Clean Air Act statutory authority of U.S. EPA. Another question raised is whether the target reductions in CO₂ are so rigorous that the Obama administration has designed the elimination of all fossil fuels, coal and natural gas, over the next 15 – 20 years. Finally, is the Plan a reorganization of the U.S. economy? The Clean Power Plan requires a great deal of unfunded action on the part of the states, citizens, and business and industry.

The Motion for Stay filed by the West Virginia Attorney General Morrisey and his colleagues is a good read and teaches of the harm this fast moving plan threatens. Morrisey’s team of legal minds includes Elbert Lin and Misha Tseytlin, two former U.S. Supreme Court clerks who have taken on the task of designing the legal issues about the Obama Clean Power Plan. The Motion for Stay references the affidavits by the States that demonstrate they will suffer irreparable injury, absent a stay, through mandatory legislative changes and significant expenditures of state monies to study and develop responses to the plan outline. The Clean Power Plan is a rush to completion.

On October 22, 2015, Elbert Lin, Solicitor General of the State of West Virginia, testified before the U.S. House Committee on Energy and Commerce, Subcommittee on Energy and Power. In the filed statement he offered, Lin highlighted EPA’s over- reach in its use of the Clean Air Act to regulate CO₂. He referenced the 2012 Section 112 program to regulate mercury emission from power plants and the 2015 ruling by the U.S. Supreme Court that EPA had acted unlawfully when it refused to consider costs in developing this sweeping regulation. This Supreme Court ruling declaring the program unlawful came after the industry had largely implemented the rule, leading to the shut down numerous power plants. Additionally, Lin’s testimony spoke to the broad impacts of the Clean Power Plan, including reorganizing energy distribution, causing dramatic, negative impacts on the economy (especially in states that rely heavily on coal to generate electricity), etc. The full text of this testimony can be found here.

Misha Tseytlin spoke to the Energy and Mineral Law Foundation’s Kentucky Mineral Law Conference on October 21, 2015. He observed that states are in the best position to bring to the court a discussion of the near-term, negative impacts that would occur if the Clean Power Plan is allowed to go forward before judicial review of these regulations. The Motion for Stay makes the point that to meet the Clean Power Plan deadlines, each State must begin taking immediate steps to determine whether and how it will: reorganize its electrical generation, transmission, and distribution system; decommission coal generation; mandate the use of natural gas generation, while imposing strict carbon dioxide emissions limits on that generation; adopt a cap-and-trade regime; radically increase investment in new renewable energy plants; and establish back-up generation. The States argue: Section 111(d) of the Clean Air Act does not authorize EPA to force states to restructure the electrical grid’ Section 112 of the Clean Air Act prohibits the Clean Power Plan.[not sure about previous sentence]

On Saturday, October 24, 2015, President Obama addressed the nation in his weeklyvideo to which is attached a transcript. He commented as follows:

We’ll also keep doing what we can to prevent the worst effects of climate change before it’s too late. Over the past six years, we’ve led by example, generating more clean energy and lowering our carbon emissions. Our businesses have stepped up in a big way, including just this past week. Some of our biggest companies made new commitments to act on climate – not just because it’s good for the planet, but because it’s good for their bottom line.

This is how America is leading on the environment. And because America is leading by example, 150 countries, representing over 85% of global emissions, have now laid out plans to reduce their levels of the harmful carbon pollution that warms our planet. And it gives us great momentum going into Paris this December, where the world needs to come together and build on these individual commitments with an ambitious, long-term agreement to protect this Earth for our kids.

Now Congress has to do its job. This month, even as Republicans in Congress barely managed to keep our government open, they shut down something called the Land and Water Conservation Fund. For more than half a century, this fund has protected more than 5 million acres of land – from playgrounds to parks to priceless landscapes – all without costing taxpayers a dime. Nearly every single county in America has benefited from this program. It has bipartisan support in both the House and the Senate. Republicans in Congress should reauthorize and fully fund the Land and Water Conservation Fund without delay.

After all, as Pope Francis reminds us so eloquently, this planet is a gift from God – and our common home. We should leave it to our kids in better shape than we found it.

President Obama’s message is nuanced. On September 16, 2015 the President commented, “I guess the bottom line is this: You can legitimately go after me on the clean power plant rule because … that was hatched by us, and I believe we need to deal with climate change, so we can have a lengthy debate about that. . . ” Perhaps he is inviting Congress to weigh in on the Clean Power Plan before the federal Courts vacate it as unlawful. The U.S. Supreme Court has put U.S. EPA on notice that they have significant questions about the agency’s over-reach. “We expect Congress to speak clearly if it wishes to assign to an agency decisions of vast economic and political significance.” UARG v. EPA, 134 S. Ct. 2427 (2014), [subscribers can access an enhanced version of this opinion: lexis.com | Lexis Advance]. In Michigan v. EPA, the majority determined “EPA strayed well beyond the bounds of reasonable interpretation in concluding that cost is not a factor relevant to the appropriateness of regulating power plants.” The majority reminds the reader that, “Not only must an agency’s decreed result be within the scope of its lawful authority, but the process by which it reaches that result must be logical and rational.” Michigan, et al. v. Environmental Protection Agency, et al., [subscribers can access an enhanced version of this opinion: lexis.com | Lexis Advance]. 

From his statement on Saturday, it appears that President Obama will blame Republicans in Congress if the federal courts overturn this rule. His message to the world stage during the December United Nations Climate Change Conference in Paris will likely be to direct attention to the dysfunction of the U.S. Congress. Finally, he is setting the stage for his successor, by declaring the high ground on environmental stewardship for the Democratic Party. Also, you can read presidential candidate Hillary Clinton’s position on the Clean Power Plan here. Note the President and Secretary Clinton share a key strategist, John Podesta. He is Clinton’s campaign chairman and was one of the architects of the Obama climate change initiatives.

On October 25, 2015 the Obama Administration announced that 81 major corporations with operations in the U.S.–including Google, Facebook, Apple, Coca Cola and General Motors–have taken a White House pledge “to demonstrate their support for action on climate change and the conclusion of a climate change agreement in Paris that takes a strong step forward toward a low-carbon, sustainable future.” Signing the White House’s American Business Act on Climate Change Pledge shows a continuing commitment to action preventing global warming and is intended to set an example for other companies to pursue similar policies, according to a statement released by the White House. It also shows the signatories’ support for the 2015 United Nations Climate Change Conference, which will be held this November in Paris. “The Pledge…voices support for a strong outcome in the Paris climate negotiations.” The 81 companies “have operations in all 50 states, employ over 9 million people, represent more than $3 trillion in annual revenue, and have a combined market capitalization of over $5 trillion,” the White House said.

The opposing sides are setting up for the debate, while all parties ponder their next move.

Steptoe & Johnson PLLC’s team working these issues is comprised of David M. Flannery, Steve Miller, Kathy Beckett and Skipp Kropp.

[1] West Virginia, Texas, Alabama, Arizona, Arkansas, Colorado, Florida, Georgia, Indiana, Kansas, Kentucky, Louisiana, Michigan, Missouri, Montana, Nebraska, New Jersey, North Carolina, Ohio, South Carolina, South Dakota, Utah, Wisconsin, and Wyoming.

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