This is an interesting decision that will have very wide-ranging consequences.
First up, however -- it does not eliminate what is known as the Chevron Deference doctrine. It nips at the edge, but as is the usual Supreme Court practice if they can find a reasoned way to not do something like that, they don't. They did, thus they didn't.
It is pertinent to the Court’s analysis that EPA has acted consistent with such a limitation for four decades. But the only question before the Court is more narrow: whether the “best system of emission reduction” identified by EPA in the Clean Power Plan was within the authority granted to the Agency in Section 111(d) of the Clean Air Act. For the reasons given, the answer is no. Pp. 28–31.
Chevron is more-broad than this, but not by a great deal -- it's a matter of degree, not act. For this reason the decision is very, very consequential. Indeed it is almost-certain to change far more than the overturning of Roe -- and that's a good thing.
Here's the key to the entire case:
Since passage of the Act 50 years ago, EPA has exercised this authority by setting performance standards based on measures that would reduce pollution by causing plants to operate more cleanly. In 2015, however, EPA issued a new rule concluding that the “best system of emission reduction” for existing coal-fired power plants included a requirement that such facilities reduce their own production of electricity, or subsidize increased generation by natural gas, wind, or solar sources.
The question before us is whether this broader conception of EPA’s authority is within the power granted to it by the Clean Air Act.
In other words the EPA took what was clearly within their regulatory authority and expanded it to claim their authority extended to an outright ban on the use of a given technology not because it produced a specific pollutant they were authorized to regulate but because they determined that another means of generating power was more to their liking.
EPA's regulatory animus comes from two primary sources. The first is so-called "NAAQS" pollutants which may reasonably be anticipated to endanger public health or welfare and which come from numerous or diverse sources, either mobile or stationary. These are substances which are not specifically traceable to any single activity, event or economic action. The second is "HAP", which targets substances that are known or expected to be carcinogenic, mutagenic, teratogenic, neurotoxic or otherwise toxic under either acute or chronic exposure.
The latter are of much higher concern for obvious reasons and there the EPA must promote emission standards that, to the maximum reasonably and economically achievable extent, reduce those emissions. For example scrubbers on a coal-fired plant are required under that rule because mercury emissions, for example, fall into the category of clearly toxic.
Then there is this third category, which is where the controversy lies in question, known as the "New Source Performance Standards" program. But this standard sets maximum emission outputs and leaves how they're achieved up to the entity in question, up to the "Best System of Emissions Reduction" applicable to that particular thing.
Here's the key element: The NSPS only applies to things that were not part of the other two regulatory schemes. If a plant was operating under the other two for those specific items of emission EPA does not get a second bite at the same apple. They already took the bite and don't get a second one.
Well, the EPA thought they could get around this specifically with carbon dioxide, which is NOT under either HAP (obviously) or NAAQS.
Thus they not only made permitting new plants basically impossible they imposed a cap-and-trade, or other similar scheme (requiring partial generation with wind or solar is in effect a cap and trade system no matter what you call it) on EXISTING plants which had the effect of making all of them uneconomic.
But the EPA's motivating animus was not reducing a "pollutant", never mind that CO2 isn't a pollutant -- it is essential for life on this planet, including human life. Without it all plants die, including plankton and algae in the oceans, and without plants there are no animals. In other words the premise is false but even leaving that aside, which the court did, the EPA stated that its motivation wasn't reducing a pollutant: It was changing the mix of how electricity is generated.
EPA explained that taking any of these steps would implement a sector-wide shift in electricity production from coal to natural gas and renewables. Id., at 64731. Given the integrated nature of the power grid, “adding electricity to the grid from one generator will result in the instantaneous reduction in generation from other generators,” and “reductions in generation from one generator lead to the instantaneous increase in generation” by others. Id., at 64769. So coal plants, whether by reducing their own production, subsidizing an increase in production by cleaner sources, or both, would cause a shift toward wind, solar, and natural gas.
The EPA then put this desire into practice, setting limits that made the operation of coal plants without shifting generation to zero-carbon sources physically impossible. They did this despite both their own and EIA analysis showing the impact would create at least a 10% increase in electricity prices and destroy tens of thousands of jobs.
That was the triggering event and many sued. But then the Obama Administration ended, Trump came in and rescinded the rule. The EPA subsequently stated that it had exceeded its authority.
This is where the USSC comes in, because there is a doctrine known as the major question doctrine. It states that for questions of major economic or political significance the authority expressed by an administrative agency must be clearly delineated in the Statute passed by Congress. That threshold is rather high, but it certainly exists and in fact was the premise on which OSHA lost with the jab mandates which, I remind you, were enjoined before full hearing as they were found to be under that set of statutory requirements. The same rejection on a final basis came with the CDC's attempt to ban evictions during the pandemic, a decision the CDC tried to ignore and got its wee-wee slammed in the door in final, conclusive fashion by the court for doing so.
Even worse in this particular case the Supremes have already ruled that CO2 cannot be classified as a "pollutant" in the case Utility Air, decided in 2014. Specifically:
1. The Act neither compels nor permits EPA to adopt an interpretation of the Act requiring a source to obtain a PSD or Title V permit on the sole basis of its potential greenhouse-gas emissions. Pp. 10–24.
End of discussion on that point; the question on whether CO2 (or any other alleged "greenhouse gas") is a "pollutant" subject to EPA regulation has been answered and the answer is NO.
This decision is in fact a restatement of that which was already decided and, as a result, doesn't reach the Chevron Deference because it doesn't have to. The EPA clearly, based on precedent in an already decided Supreme Court case, attempted to get around precedent and declare carbon dioxide capable of being regulated even though the court had found that it is not a substance that can be regulated in this fashion in the general environment on the basis of alleged greenhouse effects.
Never mind that the EPA's stated purpose was to lead to an outcome not within their regulatory remit at all; that of controlling the sources of electrical power production in the United States. Nowhere has Congress delegated to that, or any other, agency the authority to make such decisions on an administrative basis.
This question properly belongs in the Halls of Congress, not in an administrative agency. Never mind the other problems that such agency decisions lead to, specifically that they blow like a reed in the wind depending on who happens to win the White House. If you expect corporations to make investments that require decades to amortize, and power plants certainly fall within that category the regulatory decision as to such questions properly belongs in Congress where the people have the direct capacity and authority to remove those individuals who screw them.
So while Chevron still exists -- yes, this decision is an earthquake. Whether the administrative establishment will accept having its hands slammed in the door again, after both the CDC and OSHA had the same result from their attempts to ignore long-standard rules of review and constraint is an open question, but for today its the EPA's turn to have it head in the vise and its about time they did, given that they intentionally did attempt to violate a known standard of review and promulgation of rules that were in direct conflict with a 2014 decision on whether alleged "greenhouse gases" fell under their remit in the first place.
The dissent from Kagan is particularly outrageous and frankly is directly impeachable. Her opinion specifically eschews the entire concept of the people's representatives and statutory construction any time she thinks its important. This isn't the first time and I doubt it will be the last, but if and when the USSC is ever actually sacked it would be due to "opinions" similar to hers.
The bottom line is this: Absent an act of Congress greenhouse gas emissions cannot be regulated as "pollutants" including "cap and trade" schemes or demands to abandon said emissions entirely, whether in whole or part. That question was decided in 2014 at the Supreme Court and, absent an act of Congress, that's the end of the discussion on that point. One can hope all administrative agencies take note of this and adjust their behavior as this is three decisions out of the USSC in a row that have all slammed agency decisions that have no reasonable foundation in their enabling statutes.
