Key Takeaways
The Supreme Court has decided not to stay the EPA’s “power plant rule” that requires the use of an expensive and non-commercial technology while lower courts deliberate the rule and its legality.
About half the states have sued EPA, arguing that its rule would force premature closure of coal plants, pushing the generation market toward the Biden-Harris administration’s preferred plant types.
Demand for reliable electricity is increasing due to AI data centers and the Biden-Harris administration’s efforts to electrify everything.
The case will remain at the lower courts whose deliberations will now include a plea to send the rule back to EPA for reconsideration from four Regional Transmission Organizations responsible for assuring reliable electricity.
The Supreme Court will temporarily let the Biden-Harris Environmental Protection Agency (EPA) limit emissions from coal and gas power plants as lower courts hear a challenge to the rule. On October 16, the Supreme Court allowed the EPA to move ahead with a rule to limit carbon dioxide emissions from power plants, which will see the shuttering of coal-fired plants and limit the construction of new natural gas plants unless they employ very expensive and unproven commercially carbon capture and sequestration technology. The Biden-Harris regulation was enacted in April. More than two dozen states including Indiana, Alabama, Alaska, and West Virginia challenged the regulation, arguing that the federal government had failed to prove that the techniques used to control emissions would curtail them to the degree that the government is seeking.
The Supreme Court ruling, which was provisional, was in response to an emergency application as a challenge to the rule moves through the lower courts. Under the rule, coal- and new gas-fired power plants would have to capture up to 90 percent of their emissions by 2032, with less strict requirements for power plants that are scheduled to close in the coming years. According to Justice Kavanaugh, a lower court would have sufficient time to review the case given that the power plants would not have to start work to comply with the rule until June 2025. He believed that some of the Republican-led challenges “have shown a strong likelihood of success on the merits.”
West Virginia, one of the states that mounted the challenge, said it would continue to contest the rule. “We will continue to fight through the merits phase and prove this rule strips the states of important discretion while forcing plants to use technologies that don’t work in the real world,” the state’s attorney general, Patrick Morrisey, said in a statement. “Here, the EPA again is trying to transform the nation’s entire grid, forcing power plants to shutter.”
The challenge is currently pending in the U.S. Court of Appeals for the District of Columbia Circuit. In July, a three-judge panel refused a request by the conservative-led states to stop the EPA rule from going into effect while the court case continued, prompting the states and other groups to ask the Supreme Court to step in. In its decision, the appeals court panel wrote that there was no need to pause the EPA rule from going into effect while litigation continued because the case would proceed quickly and the federal government’s compliance deadlines were years from now, in 2030 or 2032.
The justices on the Appeals Court panel seem to be oblivious to the rule’s expense, planning, feasibility, and time for implementation as they require power plants to implement carbon capture technology in just eight short years.
The States’ Position
The states view the Biden-Harris EPA as being biased against fossil-fuel-fired facilities and in favor of renewables. They claim that the EPA does not have the authority to create this rule without congressional approval and that it has set “impossible-to-meet standards for regulated facilities, stripping away the states’ discretion to patch up the damage and ultimately pushing regulated sources into early retirements.”
Therefore, they want a stay to prevent the EPA from implementing this rule since it will affect industry choices on compliance spending as the courts review the case.
EPA’s Position
The Biden-Harris EPA claims that the 90 percent carbon capture rule is within the EPA’s jurisdiction on setting emissions limits since it determined that it was the best approach. Carbon capture involves capturing carbon dioxide emissions from “industrial streams” of power plants and storing them deep underground in geologic formations. The Biden-Harris administration argues that the challengers object to the EPA’s “technical and scientific judgments regarding the dependability, feasibility, and cost of carbon capture,” instead of its Clean Air Act interpretation.
Four Regional Transmission Organizations File an Amicus Brief
Organizations responsible for overseeing electricity services for 156 million Americans across 30 states are warning that the Biden-Harris administration’s power plant regulations could have dire consequences for the nation’s energy grid. Four regional trade associations have submitted an amicus brief supporting a multi-state lawsuit against the EPA regarding these regulations. Their brief contends that enforcing the current rules could jeopardize reliable power delivery, directly contradicting the administration’s claims that these regulations will not affect long-term power stability. They have urged the Court to return the rules to the EPA for further review.
Incidents like the 2019 blackouts in California, the tragic Texas blackouts during Winter Storm Uri in 2021, and the Southeast blackouts over Christmas 2022 serve as urgent reminders of the increasing risks to the electricity grid. Forcing fossil fuel generators to shut down or incur significant costs for unproven and unavailable technologies poses a real threat. According to the brief, the regional trade organizations had proposed options to the EPA aimed at preventing blackouts, but these were ignored – the filing of which is precedent-setting for the organizations. These organizations face the challenge of maintaining grid stability amid rising demand, driven by the power needs of data centers for AI and the Biden-Harris administration’s efforts to electrify more sectors of the economy.
Conclusion
The Biden-Harris administration is threatening the grid’s reliability with its power plant rule and rejecting the advice of those responsible for ensuring blackouts do not occur, according to 4 regional transmission organizations who filed an Amicus Brief to the D.C. Court of Appeals. More than two dozen states, in a lawsuit, have argued inadequate or politicized analysis was done by the EPA to justify its new rule, which would force the closure of existing coal plants and ban new natural gas plants, resulting in disruption to the electric grid, unless very expensive technology that is currently unproven commercially is added to the plants. The states asked the Supreme Court for a stay to the rule while it goes through the lower courts, but the Supreme Court did not grant it. The costs of the rule are enormous and Americans will pay through higher electric rates and less reliable electricity service. A regulation presuming the use of a non-commercial technology and forcing the closure of power plants is a huge problem that requires the courts’ redress.
