SCOTUS Limits Federal Agency Power

In one of its final decisions in an already-charged session, the U.S. Supreme Court ruled that the Clean Air Act (CAA) did not give the Environmental Protection Agency (EPA) broad authority to regulate carbon dioxide emissions from power plants. The case is called West Virginia v. U.S. EPA.

The case arose out of the Obama administration's Clean Power Plan, which would have required states to reduce emissions from the generation of electricity, mostly by moving away from coal-fired plants and toward sustainable energy sources. The Clean Power Plan never went into effect because the Court blocked it back in 2016. When Trump was elected, his administration repealed the Clean Power Plan, arguing the federal government should not take such an active role in reducing carbon emissions. (Notably, even without the Clean Power Plan, many states and utilities shuttered coal plants and embraced other energy sources anyway.) Twenty-one states sued the EPA urging the Court to reject the Trump plan. The case rose through the federal courts until it reached the U.S. Supreme Court, which agreed to take the case and hear oral arguments.

The majority ruled that Congress, through the CAA, had not given explicit authority to the EPA to enact these sweeping regulations to address carbon emissions. The majority held Congress needed to make a “clear delegation” of this authority to the EPA for the Agency to be able to adopt greenhouse gas rules like the ones at issue. The ruling seriously limits the EPA’s power, but does not completely eliminate the EPA’s ability to regulate the energy sector. The Agency can still use emission controls at individual power plants, but now is restricted from adopting more ambitious approaches like a cap-and-trade system. Justice Roberts wrote for the majority and explained that agencies may not adopt rules that are "transformational" to the economy —unless the agency can point to “clear congressional authorization” to regulate in that manner. In a concurring opinion, Justice Gorsuch noted that this case applied the “major questions doctrine,” which ensures that when agencies seek to resolve major questions, they act with “clear congressional authorization and do not ‘exploit some gap, ambiguity, or doubtful expression in Congress’s statutes to assume responsibilities’” beyond what Congress actually conferred on the agency.

The three dissenting justices responded that the majority had stripped the EPA of “the power to respond to the most pressing environmental challenge of our time.” Justice Kagan wrote that the Supreme Court had substituted its own policy judgment for that of Congress:

“Whatever else this court may know about, it does not have a clue about how to address climate change,” she wrote. “And let’s say the obvious: The stakes here are high. Yet the court today prevents congressionally authorized agency action to curb power plants’ carbon dioxide emissions.”

The West Virginia case has potential implications for agriculture, too. The decision sets the stage for further limitations on other administrative agencies in the absence of explicit congressional authorization for the regulations in question. This could mean the USDA, FSA, and other federal agencies will see challenges to their authority any time those agricultural agencies seek to resolve a “major question.”