Economy, Regs, & Taxes

All Isn't Lost, as SCOTUS Rebukes EPA

Coal regulations didn't properly account for the massive cost.

Lewis Morris · Jun. 30, 2015
EPA chief Gina McCarthy isn't pleased

The Supreme Court proved it still has a little bit of respect left for Rule of Law in its decision yesterday in Michigan v. EPA. In a 5-4 ruling that predictably followed partisan lines with Justice Anthony Kennedy swinging to the right, the High Court ruled that the Environmental Protection Agency did not properly consider the high costs of regulation of emissions from coal-fired power plants.

That this Court — the one content to rewrite ObamaCare in order to save it, twice — found the EPA went too far in rewriting the law is saying something.

The EPA, which has been pursuing the ecofascist dream of completely wiping the coal industry off the face of the earth, released a series of regulations in 2012 that would force energy producers to comply with limits on mercury and air toxins released in coal energy production. The National Federation of Independent Business said the regulations, known as Mercury and Air Toxics Standards (MATS), are among the costliest ever issued.

The EPA estimated the new rules would cost close to $10 billion annually, while bringing direct annual benefits of no more than $6 million. Bureaucrats also made the un-provable assertion that the rules would prevent up to 11,000 premature deaths and 130,000 asthma cases each year. In developing its regulations, the EPA was expected to adhere to the Clean Air Act’s “appropriate and necessary” standard. But the agency arbitrarily determined that cost had no bearing in the development of the regulations, essentially flouting the decades-old law and choosing to make up its own rules. The EPA determined that its work protecting the environment justified whatever actions it saw fit.

Justice Antonin Scalia’s majority opinion stated, “EPA strayed well beyond the bounds of reasonable interpretation in concluding that cost is not a factor relevant to the appropriateness of regulating power plants.” Scalia also noted, “The costs to power plants were … between 1,600 and 2,400 times as great as the quantifiable benefits from reduced emissions of hazardous air pollutants.” He added, “No regulation is ‘appropriate’ if it does significantly more harm than good.”

House Majority Leader Kevin McCarthy of California weighed in on the decision in a statement, saying, “The Supreme Court’s decision today vindicates the House’s legislative actions to rein in bureaucratic overreach and institute some common sense in rule making.” That said, Congress has more work to do to rein in an out-of-control EPA, especially given that the Court left open a substantial loophole of sorts: Regulations are fine as long as the EPA “counts the cost.”

Indeed, the EPA seemed unmoved by the decision, with spokeswoman Melissa Harrison saying, “EPA is disappointed … but this rule was issued more than three years ago … and most plants are already well on their way to compliance.” In other words, she gloated that the damage was already done and blew a raspberry at opponents.

The EPA and the White House will certainly try to play down this loss, but the Court’s decision lays groundwork for a number of other cases in which multiple states are seeking to challenge the imperial overreach of the EPA. As noted by National Mining Association President Hal Quinn, “The decision effectively puts EPA on notice: reckless rulemaking that ignores the cost to consumers is unreasonable and won’t be tolerated.”

But Justice Clarence Thomas warned in his concurring majority opinion, “[W]e seem to be straying further and further from the Constitution without so much as pausing to ask why. We should stop to consider that document before blithely giving the force of law to any other agency ‘interpretations’ of federal statutes.” We can think of a few other cases in which that logic applies, and we hope this victory isn’t merely symbolic.

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