On January 19, 2021, the D.C. Circuit Court of Appeals ruled that the U.S. Environmental Protection Agency’s (EPA’s) Affordable Clean Energy Rule (ACE Rule) for greenhouse gas emissions from power plants rested on an erroneous interpretation of the Clean Air Act that barred EPA from considering measures beyond those that apply at and to an individual source. The court therefore vacated and remanded the ACE Rule—which repealed the 2015 Clean Power Plan rule and in its place adopted a replacement rule that relied only on heat-rate improvements at individual plants. In concluding that Section 111 of the Clean Air Act does not limit EPA to identifying a “best system of emission reduction” consisting only of controls “that can be applied at and to a stationary source,” the D.C. Circuit’s majority opinion first concluded that neither the text nor the statutory history, structure, and purpose compelled such a reading. Second, the D.C. Circuit ruled that EPA incorrectly invoked the “major questions doctrine”—which requires a clear statement from Congress when an agency’s regulatory action is of “extraordinary” significance—to support its interpretation of Section 111. The court found that Congress and the courts had long recognized EPA’s authority to regulate greenhouse gases from power plants under Section 111, and that the major questions doctrine did not apply to EPA’s identification of the “best system of emission reduction.” The court said Congress knew “both the scope and important of what it was doing” when it gave EPA authority to set standards and that it “cabined the EPA’s authority with concrete and judicially enforceable statutory limitations.” With respect to the significant regulatory consequences of the standards, the D.C. Circuit indicated that the consequences were “a product of the greenhouse gas problem, not of the best-system’s role in the solution,” writing that “any nationwide regulation of [power plants’] greenhouse gas pollution will necessarily affect a broad swath of the Nation’s electricity customers.” The court also rejected EPA’s contention that the major questions doctrine applied because the Clean Power Plan regulated the electric grid and not air pollution. Third, the D.C. Circuit held that the federalism canon—requiring that Congress use “exceedingly clear language” to alter the balance of power between the federal government and the states—did not support an interpretation limiting the best system of emission reduction to measures applied at and to the source. The D.C. Circuit also rejected two arguments by coal companies against the ACE Rule. First, the court found that EPA made and retained the requisite endangerment finding for regulation of carbon dioxide emissions from power plants. Second, the court found that EPA “correctly and consistently” interpreted the Clean Air Act to permit both regulation of a source’s hazardous air pollutant emissions under Section 112 and emissions of other pollutants under Section 111(d). The D.C. Circuit also concluded that two petitioners—Texas Public Policy Foundation and Competitive Enterprise Institute—lacked organizational standing to challenge EPA’s authority to promulgate the ACE Rule. Finally, the D.C. Circuit found that amendments to the regulations implementing Section 111(d)—which extended the timeline for compliance—lacked reasoned support. Because EPA’s sole defense for repeal of the Clean Power Plan and replacement with the Affordable Clean Energy Rule was that the interpretation underlying the rule was the only permissible one, the D.C. Circuit vacated the ACE Rule and remanded to EPA. Judge Walker issued a separate opinion dissenting from the majority’s conclusion that EPA had authority to regulate coal-fired power plants under both Section 111 and Section 112. Although he concluded that regulation of coal-fired power plants was foreclosed for this “more mundane reason” and thus concurred in the vacating of the ACE Rule, Judge Walker also wrote that he doubted the validity of the Clean Power Plan—which he characterized as “arguably one of the most consequential rules ever proposed by an administrative agency”—under the major questions doctrine. The court directed that issuance of the mandate be withheld until seven days after disposition of any petition for rehearing or petition for rehearing en banc.

Challenge to final rule repealing the Clean Power Plan and replacing it with the Affordable Clean Energy rule.

American Lung Association v. EPA

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D.C. Circuit Vacated Trump EPA’s Affordable Clean Energy Rule

Filed

United States of America

District of Columbia

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An aim to achieve a quantifiable outcome within a given time-frame, set by an institution such as a national government.

Policy instruments are techniques or tools used by governing authorities to promote certain policies in order to achieve predetermined goals. Put simply, instruments are how a government tries to achieve its goals, with this taxonomy being focused on national policy instruments.

Risk is the potential for adverse consequences resulting from the dynamic interplay between (climate-related) hazards, exposure, and vulnerability of affected human or ecological systems.

Groups  of people who are adversely affected by climate change or the response to it

A set of principles, processes, and practices that build economic and political power to shift from an extractive economy to a regenerative economy.

Justice is the ethical and political framework that addresses fairness, including issues of responsibility, rights, and structural inequity.

Renewable energy means all forms of energy produced from renewable sources in a sustainable manner.

Fossil fuel is a generic term for non-renewable energy sources such as coal, fossil gas, and oil (including crude oil, and petroleum products), that can be used for electricity and heat generation. Fossil fuels are hydrocarbons formed from pressurised and heated organic material buried over millions of years.

Molecules in the atmosphere that play a key role in the greenhouse effect by trapping heat radiating from Earth’s surface.

Area of the economy in which actors engage in identical or related activities.

In human systems, the process of adjustment to actual or expected climate change and its effects, in order to moderate harm, increase resilience or exploit beneficial opportunities. In natural systems, the process of adjustment to actual climate change and its effects; human intervention may facilitate adjustment to expected climate change and its effects.

The management and allocation of funds, assets and investments to meet various objectives

A loan is a policy instrument where funds are provided to a borrower with the expectation of repaying the principal plus interest.

Financial support to help individuals manage the effects of unexpected events, securing their livelihoods and increasing the resilience of people and businesses to the changing climate. It’s especially vital in developing regions where everyday risks, climate-related weather extremes, or crop failures can push people into poverty. Without insurance, people may have to resort to selling assets or cutting consumption to cope with losses.

Tradable permits are market-based tools that grant permission for specific activities, frequently used to regulate emissions. These permits can be issued within a trading system to manage environmental impacts.

Codes and standards are regulatory instruments that specify minimum standards to protect health and safety. This ranges from performance standards, which prescribe outcomes while allowing flexibility to achieve compliance, to the more prescriptive approach of technology-specific standards.

Zoning and spatial planning are both methods for guiding the distribution of people and activities in a space, and are regulatory restriction.

A ban is a legal action that prevents the sale or supply of a product or service, or that recalls a product from the market. Examples are bans on SF6, greenwashing, fossil fuel advertisement or single-use plastics.

Either money or something of monetary value is transferred between two or more organisations, people or countries.

Actions or measures to adapt terrestrial systems to climate change.

Actions or measures to adapt freshwater systems to climate change.

Actions or measures to adapt freshwater, coastal and marine systems to climate change.

Hot temperature extremes are daily maximum temperatures  that were exceeded on average once in a decade or once in 50 years, and includes heatwaves.

The release of heat-trapping gases, primarily from human activities such as burning fossil fuels, agriculture and industry.

A long-lived, colourless gas, chiefly emitted from fossil fuel combustion, deforestation and cement production.

Actions to reduce emissions in energy generation and supply.

Technologies that capture and hold energy in reserve for later use.

Risks to the ecosystem health of the marine environment, including ocean warming, ocean acidification, and ocean deoxygenation, harming biodiversity, species health, ecosystem services, and coastal community livelihoods.

Extreme weather refers to events where a weather variable exceeds (or falls below) a threshold. Meaning it is significantly different from the average or usual weather pattern.

A drought is an extended period of unusually dry weather marked by a significant and sustained lack of precipitation, falling below a specific threshold over a large area for more than a month

Terrestrial means "of the earth" and relates to the risks to ecological system that includes all living organisms and their interactions within land-based environments, such as forests, grasslands, and deserts.

Air pollution involves harmful contaminants in the air, affecting both indoor and outdoor environments. It can lead to health issues like respiratory diseases and heart problems, and climate impacts such as global warming. Pollutants can damage plants, trees, habitats, and water bodies like rivers and lakes.

Social inclusion is the process of improving the terms on which individuals and groups take part in society—improving the ability, opportunity, and dignity of those disadvantaged on the basis of their identity.

Kinetic energy of airflow transformed into useful energy, mostly electrical energy.

Oil is a combustible liquid fossil fuel composed mainly of hydrocarbons, occurring as crude oil and refined into petroleum products such as petrol, diesel and kerosene.

Fossil gas, commonly known as natural gas, is a fossil fuel consisting chiefly of methane with smaller amounts of other hydrocarbons and trace gases, found in underground deposits.

Coal is a combustible sedimentary rock formed from carbonised plant matter, rich in carbon and hydrocarbons, and occurring in several main types including hard coal and brown coal.

People with different national or cultural traditions from the dominant population

Social and cultural groups that share collective ancestral ties to the lands and natural resources where they live, occupy or from which they have been displaced

woman and genders outside of the gender binary

Activities of industries that extract natural resources, such as mining, oil, and gas, for commercial use.

The activities of industries that transforms raw materials into finished goods through industrial processes.

The activities of industries involved in the production, distribution, and sale of energy, including electricity, gas, and renewables.

This sector involves managing waste treatment, sanitation, pollution control and environmental cleanup.

Activities that involve planning, designing and building infrastructure, residential, and commercial structures.

This sector involves the wholesale and retail selling of goods.

This sector involves activities to move goods and people, alongside the storage of products.

This sector creates and distributes information and entertainment through television, radio, print, and digital platforms.

This sector provides communication services, software development, and IT solutions.

This sector involves activities that impart knowledge and skills to individuals, including formal schooling, vocational training and educational support.

Activities of government agencies and institutions that provide public services, enforce laws and manage public resources.

This sector includes firms and individuals offering specialised expertise in fields such as law, accounting, consulting, science and engineering.

Activities of businesses and institutions that provide financial services and products to individuals and organisations.

Climate change can have a range of impacts on technological system. Extreme weather events can cause infrastructure failures like power outages or damage to roads and bridges, as well as the impacts from waste following natural disasters. Human activities also cause technological impacts, such as the risks posed by oil spillage and leaks.

Any substance with chemical properties that can cause physical harm to people or damage the environment, including ammonia, carbon monoxide, phosphine, chlorine, arsenic, cadmium, mercury, pesticides, dioxins, microplastics, benzene, asbestos, aflatoxins, fluoride, methanol, and toxins from marine sources.

Slow onset events evolve gradually from incremental changes over many years or from increased frequency or intensity of recurring events. As defined in the Cancun Adaptation Framework (2010), slow onset events include risks and impacts from rising temperatures, desertification, biodiversity loss, land and forest degradation, glacial retreat, ocean acidification, sea level rise, and salinization.

D.C. Circuit Vacated Trump EPA’s Affordable Clean Energy Rule

Policy instrument

Risk

Impacted group

Just transition

Renewable energy

Fossil fuel

Greenhouse gas

Economic sector

Adaptation/resilience

Finance