July 15, 2022 – Safety & Compliance

Supreme Court Limits EPA Authority Under Clean Air Act.  In a decision that could have far-reaching implications for taming the federal regulatory state, the U.S. Supreme Court has ruled the Congress did not constitutionally authorize the Environmental Protection Agency to issue significant rules—including those capable of reshaping the nation’s electricity grids and unilaterally decarbonizing virtually any sector of the economy—without any limits on what the agency can require so long as it considers cost, non-air impacts, and energy requirements.

In West Virginia v. EPA, the Court in a 6-3 decision held that the EPA may not implement its Clean Power Plan rule, which addressed carbon dioxide emissions from existing coal- and natural-gas-fired power plants, without “clear congressional authorization” for the authority that the agency claims.

Under the “major questions doctrine,” the Court explained there are “extraordinary 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. Under this body of law, given both separation of powers principles and a practical understanding of legislative intent, the agency must point to “clear congressional authorization” for the authority it claims.

In this case, the EPA had relied on a vague section of the Clean Air Act to adopt a regulatory program on carbon cap-and-trade and emissions limits from both new and existing coal and natural gas plants under the agency’s Clean Power Plan.  But the Supreme Court noted that Congress had considered this approach many times yet conspicuously declined to enact it itself.

Promulgated in 2015, the Clean Power Plan never went into effect.  Numerous parties filed suit as soon the new rule was issued, and the Supreme Court granted a stay preventing the rule from taking effect in 2016.  The EPA under the Trump Administration then repealed the rule in 2019, concluding that the Clean Power Plan had been “in excess of its statutory authority.”  In the same rulemaking, the agency replaced the Clean Power Plan by promulgating a different regulation under its Clean Air Act authority, known as the Affordable Clean Energy (ACE) Rule.

A number of States and private parties immediately filed petitions for review in the D. C. Circuit Court of Appeals, challenging EPA’s repeal of the Clean Power Plan and its enactment of the replacement ACE Rule.  Other States and private entities intervened to defend both actions.

On January 19, 2021, the Court of Appeals vacated the agency’s repeal of the Clean Power Plan and remanded the issue to the EPA for further consideration, holding that the EPA misconstrued the scope of its authority (the Trump Administration EPA had argued that the Clean Air Act did not authorize it to implement the Clean Power Plan under the major questions doctrine because Congress had not explicitly granted such authority).  The appellate court also vacated and remanded the replacement rule, the ACE Rule, for the same reason.

Once the Biden Administration took office, it began working on a new emissions scheme under the Clean Power Plan.

The Supreme Court held that in certain extraordinary cases such as this one, a regulatory agency may not rely on a general grant of authority from Congress in an enabling statute.  Instead, where the regulations will have substantial economic and political significance, Congress must speak clearly in the granting the authority underlying the agency action.

The Court concluded that capping carbon dioxide emissions at a level that will force a nationwide transition away from the use of coal to generate electricity may be a sensible “solution to the crisis of the day.” But the Court held it is not plausible that Congress gave EPA the authority to adopt on its own such a regulatory scheme in the Clean Air Act. A decision of such magnitude and consequence rests with Congress itself, or an agency acting pursuant to a clear delegation from that representative body.

This decision might call into question many other expansive and costly regulatory actions in environmental and other areas that are based on general and unspecified grants of authority from Congress.  This majority opinion from the Supreme Court may be used by future litigants to restrict regulatory overreach and return authority to Congress.

PHMSA Seeks Input on Electronic Hazard Communication.  The Pipeline and Hazardous Materials Safety Administration is seeking public input on the potential use of electronic communication as an alternative to current, physical documentation requirements for hazard communication.

The agency is considering revisions to the Hazardous Materials Regulations to authorize a performance-based electronic communication alternative to the existing physical, paper-based hazard communication requirements. This revision is meant to facilitate and promote the use of electronic hazard communication.

For the purpose of this request for information, “hazard communication” means shipping papers, train consists, dangerous goods manifests, notifications to the pilot in command, and emergency response information, as well as associated administrative documentation including Department of Transportation Special Permits, approvals, and registrations.

The HMR currently require that hazard communication be maintained as physical, printed documents during transportation. However, PHMSA notes that widely adopted technologies could supplement, or replace, the existing paper-based hazard communication system, and offer opportunities for improved emergency response and oversight, as well as increased efficiency in the operations of transportation networks.

The agency said it “anticipates that electronic communication would improve transportation safety, efficiency, and effectiveness by providing electronic access to the same required information currently contained in hazard communication documents.” With this request for information, PHMSA seeks public input to help determine the most effective mechanisms and potential impediments for implementing electronic hazard communication.

Although this notice is not a proposed rule or even an advance notice of proposed rulemaking, the information received in response to this notice will likely form the basis of a proposed rulemaking.



To Top