You are here

Clean Power Plan: In landmark case, legions line up for battle

Monday, September 26, 2016

By Ellen Gilmer

Oral arguments tomorrow over the Obama administration's landmark Clean Power Plan are expected to draw hordes of spectators, but that's just a small fraction of the hundreds of groups, states and companies with a stake in the outcome.

The case's formal name, West Virginia v. EPA, belies the swarm of parties deeply entrenched on each side.

After more than two dozen states, utilities and coal companies fired the first shots against the finalized rule last October, additional lawsuits came pouring in from electric cooperatives, labor groups, business associations and conservative groups.

Supporters of U.S. EPA's regulation were quick to jump in to defend it. Eighteen states lined up on EPA's side, joined by environmentalists, health groups and local governments. Clean energy groups and a collection of utilities also stepped in.

And on the periphery of the main combatants, everyone from Mars Inc. and Madeleine Albright on EPA's side to former state regulators and legal nonprofits on the other side have filed friend-of-the-court briefs to voice their own concerns.

While the final roster is massive and varied, these are the key players and what they have on the line:

 

The Obama administration

The Obama administration's bold plan to cut carbon emissions from the power sector is a critical piece of the president's broader efforts to address climate change.

EPA staffers have spent years crafting the rule, which first came out in draft form more than two years ago. A court decision striking it down would be a major blow to President Obama's climate legacy, observers say.

White House officials downplayed the impact in February when the Supreme Court intervened to freeze the rule during litigation, noting the administration's multipronged approach to addressing climate change, including EPA's recently finalized methane regulations for the oil and gas industry.

But in legal documents, government lawyers have painted a more dire picture. Before the stay was issued, EPA argued that any delay would prevent the agency from meeting its duty to protect the public from "catastrophic harm."

And while the Supreme Court stay came after an international climate deal was struck in Paris, some say the United States will have a tough time meeting its own goals and persuading other countries to reduce carbon emissions if the Clean Power Plan is ultimately tossed.

Republican critics and industry representatives have driven much of that debate, arguing earlier this year that without the "illegal" Clean Power Plan, the United States may not be able to achieve its goal of a 26 to 28 percent reduction in greenhouse gas emissions from 2005 levels by 2025.

 

States

States have been at the center of the debate over the Clean Power Plan since the beginning. And for good reason: The rule is built on state-by-state targets.

Twenty-eight states are opposing the regulation, while 18 are supporting it in court. Only four states have declined to enter the litigation fray in any capacity, and one of those, Alaska, is exempt from the rule's requirements.

The states arguing against the rule question it on both Clean Air Act and constitutional grounds. They say the rule "commandeers" state governments to achieve federal goals, violating the 10th Amendment.

The plan sets state-level goals and directs states to either craft plans to meet the targets or adopt a federal compliance plan. Former state regulators weighing in on EPA's rule say the plan disrupts the authority of public utility commissions and other regulatory bodies that typically decide when and how to make changes to electricity generation, based on each state's prerogatives.

States supporting EPA say claims that the agency is treading on their turf are exaggerated.

"It's hard to succeed on a commandeering argument when there's no commandeering," Iowa Attorney General Tom Miller (D) said in a recent call with reporters, arguing that the rule offers states "enormous flexibility" for compliance.

Iowa is one of 18 states defending the rule as intervenors in court, along with the District of Columbia, Chicago, New York and several other cities and other local governments.

Without the Clean Power Plan, they say they'll bear the brunt of the disastrous effects of climate change. In legal briefs this year, the states argued they'll face increased flooding, more severe storms, wildfires and drought without federal action on climate change.

 

Power sector and industry groups

The power sector and mining companies have largely unified against the Clean Power Plan. Utilities and electric cooperatives were early challengers to the rule, saying many power plant operators will be forced to shutter coal-fired plants.

In fact, they say, they've already been affected by the rule because shifting generation for electricity takes years of planning and early investments.

Industry associations and coal companies are in a similar camp, calling the Clean Power Plan part of Obama's "war on coal." They worry decreased reliance on coal-fired power plants will mean shuttered coal mines, tens of thousands of lost jobs and economic devastation for communities dependent on mining.

"This unlawful rule will devastate the coal industry and those who depend upon its success while putting at risk affordable energy and thousands of good paying jobs," West Virginia Attorney General Patrick Morrisey (R) said in a statement last week.

But power companies aren't all against the rule. A coalition of utilities, including Southern California Edison Co. and Pacific Gas and Electric Corp., joined the litigation on EPA's side, along with the American Wind Energy Association and Solar Energy Industries Association.

Describing themselves as "forward-thinking," they say their investments in clean energy will be undermined if the rule is ultimately scrapped.

In a surprise move, Dominion Resources Inc. has also signaled some support for the rule. In a friend-of-the-court brief, the company said other utilities should value the plan's "flexible, accommodating compliance framework" because it is "challenging but ultimately manageable for regulated power plants."

The Virginia-based utility, which owns several coal- and gas-fired plants and nuclear plants, noted that it was not endorsing the rule outright but, rather, warning other utilities that arguments against the rule's market-based measures could result in costlier regulations down the road.

 

Environmental and public health groups

Concerns from environmental and health groups largely track with those of the Obama administration when it comes to the Clean Power Plan.

National green groups including the Sierra Club, Natural Resources Defense Council and Center for Biological Diversity entered the litigation last fall, joined by the powerhouse American Lung Association and several other environmental groups. Additional health groups backed the rule through friend-of-the-court briefs.

A separate contingent of Appalachian environmental groups also intervened in the case, seeking to counter the rhetoric of West Virginia's attorney general, who is leading states against the rule.

Together, the groups say the Clean Power Plan must be upheld to protect their members from air pollution and climate change.

"Delay, weakening, or invalidation of the Clean Power Plan would harm the organizations' members by exacerbating the impacts of climate change," they said in a brief last fall.

The groups have moved to offense this year, churning out frequent reports and expert analyses about the benefits of the plan. In a call with reporters last week, UCLA School of Law professor Ann Carlson argued that the plan's approach to carbon cuts is a "smart choice."

Rather than looking at individual power plants, the rule "viewed the grid as a big, integrated machine," Carlson said on a call hosted by the Constitutional Accountability Center and promoted by the Environmental Defense Fund. "EPA took advantage of the interconnected nature of the grid."

 

Tomorrow's argument lineup

Tomorrow's court proceedings will feature 16 lawyers representing the various parties in a range of arguments over the rule.

West Virginia Solicitor General Elbert Lin and Sidley Austin LLP attorney Peter Keisler, representing industry, will kick off the day with arguments that the rule violates the Clean Air Act by requiring emissions cuts that can only be achieved "beyond the fence line" of individual plants.

Department of Justice attorney Eric Hostetler will respond, followed by New York Assistant Attorney General Michael Myers and Paul Hastings LLP attorney Kevin Poloncarz on behalf of power companies supporting the rule.

Lin and Hunton & Williams LLP attorney Allison Wood, representing industry, will then move on to arguments over whether the Clean Power Plan can regulate carbon dioxide emissions under Section 111(d) of the Clean Air Act when EPA already regulates hazardous air pollutants from power plants under Section 112. DOJ's Amanda Berman and environmental lawyer Sean Donahue will respond.

Next up are BakerHostetler attorney David Rivkin Jr., representing states, and Harvard Law professor Laurence Tribe, representing industry, to argue that the rule unconstitutionally commandeers state governments to achieve federal goals. Berman and Myers will respond.

Moving to administrative issues, J. Campbell Barker from the Texas attorney general's office and Crowell & Moring LLP's Tom Lorenzen, representing electric co-ops, will argue that EPA's final rule was too dramatically different from the draft version. DOJ's Norman Rave will respond.

Finally, Wisconsin Solicitor General Misha Tseytlin and Hunton & Williams attorney F. William Brownell will make a variety of technical arguments against the rule. Rave, Poloncarz and DOJ's Brian Lynk will respond.

Proceedings begin at 9:30 a.m. EDT at the U.S. Court of Appeals for the District of Columbia Circuit. Click here for E&E's guide to the legal battle.