The war in Eastern Europe shows how energy prices can spike in short periods of time and shows how important it is to ensure America’s energy independence. A burdensome regulatory framework only makes our nation more dependent on foreign countries to supply energy resources. And that raises the stakes in an important case currently before the Supreme Court.
Last week, the court heard oral arguments in West Virginia v. EPA. This case will determine whether the EPA can issue a rule that would transform how our nation generates electricity under the thinnest of legal pretenses. Listening to the arguments, the EPA would have you believe this case is about complex legal issues about standing and jurisdiction — not about administrative authority to make new laws. Make no mistake, however, this case is about how far administrative agencies can go when issuing enormously potent regulations and whether these agencies violate fundamental tenets of our constitutional structure when they do so.
Some background: In the final year of his presidency, Barack Obama’s EPA finalized a regulation entitled the Clean Power Plan designed to reduce greenhouse gas emissions from existing power plants. Two of the main provisions of the CPP are categorized as “generation shifting” because their implementation will change how your electricity is generated. In short, the reductions of GHG emissions required under the CPP occur only when the source of power generation has shifted from traditional fossil-fuel generators to sources using renewable resources such as wind and solar. Implementing these provisions will cause wholesale electricity prices to rise by $214 billion, with some states seeing an increase in prices exceeding 25%. As you would expect, this rule will impose enormous costs on the American economy.
In an unprecedented ruling, the Supreme Court temporarily stayed implementation of the CPP — presumably concluding that EPA did not have the statutory authority to issue such a massively consequential regulation. Former President Donald Trump’s EPA then rescinded the rule and replaced it with a more modest regulation in line with the limits of EPA authority. Parties supporting the CPP challenged these actions, and last year a federal appeals court in Washington ruled that rescinding the CPP was improper.
President Biden’s EPA jumped into the fray, supporting the appeals court’s decision. States like West Virginia that have challenged EPA’s authority argue that the CPP constitutes a major rule requiring a specific delegation from Congress. These parties have seized on recent comments by Justices Brett M. Kavanaugh and Neil M. Gorsuch that suggest they may be amenable to arguments that agencies overstep their authority when the agency issue major rules without a clear congressional delegation and are counting on the Justices to rein in EPA.
In oral arguments last week, the very capable Solicitor General Elizabeth Prelogar — appearing on the EPA — argued that whether the EPA could issue the CPP wasn’t on the table because the EPA hadn’t yet implemented the CPP. She noted that EPA had tabled implementation of the CPP while it works to complete an updated version. Thus, according to the feds, no parties have yet to suffer ill effects from the CPP, and challenges should not be adjudicated. Those opposing EPA argued that the lower court’s ruling allows EPA to reissue the untenable provisions originally set in the CPP at any time.
Don’t be fooled by EPA’s arguments about standing and jurisdiction. Despite the savvy legal maneuverings of the solicitor general, a decision from the Supreme Court upholding the lower court’s decision would give the green light to EPA to impose enormous costs on our economy. Failure to stop the EPA will lead the Biden administration to issue a massive and updated CPP imposing billions of dollars in costs and reshaping the electric grid.
Massive regulatory endeavors like the CPP (or any updated version promulgated by Mr. Biden’s EPA) should be implemented only when Congress has directly authorized the administrative agency to take such action. This idea, known as the “major rules” doctrine, is based on the fundamental constitutional principle that Congress makes laws — not unaccountable bureaucrats at EPA.
If the catastrophic claims about climate change are true and the changes we need to make to our way of life are dramatic, the Congress of the United States should be the entity that charts our course. Agencies such as EPA shouldn’t use decades-old statutes that were never intended or designed to address climate change to craft onerous regulations that dictate how we generate electricity.
No one says getting legislation through Congress is easy. But that’s the point: When enacting policies that will have hundreds of billions of dollars in impact and will upend the way power companies generate electricity, the body most representative of the people should speak. Until then, agencies like the EPA should stay out of the game — no matter how clever their arguments, especially when energy prices are skyrocketing.
• Michael O’Neill is the assistant general counsel at Landmark Legal Foundation.