Recent Developments In Regulating Greenhouse Gas Emissions

The Supreme Court Grants EPA's Petition For Certiorari In Transport Rule Case, And President Obama Issues Executive Directive To EPA Regarding Carbon Emissions

The Supreme Court's Grant of Certiorari Reviewing the DC Circuit's Decision to Vacate

EPA's Transport Rule

On Monday, June 24, 2013, the U.S. Supreme Court granted the petition of the U.S. Environmental Protection Agency ("EPA") for a writ of certiorari to review the decision of the United States Court of Appeals for the District of Columbia Circuit (the "DC Circuit") in EME Homer City Generation, LLP v. EPA, 696 F. 3d 7 (D.C. Cir. 2012) striking down EPA's Cross-State Air Pollution Rule ("CSAPR" or the "Transport Rule"). EME Homer City Generation, L.P. v. EPA, 696 F. 3d 7 (D.C. Cir. 2012), reh'g and reh'g en banc denied, No. 11-1302 (D.C. Cir. Jan. 24, 2013); EPA v. EME Homer City Generation, L.P.), petition for cert. granted (U.S. June 24, 2013) (No. 12-1182).1

Two groups of parties filed briefs in support of EPA's petition: a group of 15 states and cities (the "State and City Petitioners") and, in addition, Calpine Corporation and Exelon Corporation (the "Industry Petitioners"). The Court granted the petition over the objections of two groups of parties that filed opposition briefs: a group of 34 utilities, power generators, coal companies and labor organizations (the "Industry and Labor Respondents") and a group of 17 states and cities (the "State and City Respondents").

EPA issued CSAPR on July 6, 2011. As noted in our previous Clients & Friends articles on CSAPR and the ensuing litigation, CSAPR would have required significant reductions in emissions of sulfur dioxide and nitrogen oxide from power plants in 27 states in the eastern half of the U.S. that contribute to "downwind" ozone or fine particle pollution in other states. CSAPR was EPA's attempt to replace the Clean Air Interstate Rule ("CAIR"), which the DC Circuit also struck down in 2008.2 See prior memoranda here:

http://www.cadwalader.com/assets/client_friend/071511EPAFinalizesCSAPR.pdf;

http://www.cadwalader.com/assets/client_friend/101512EPAPetitionsDCCirRehearingEMEHomerCityGen.pdf;

http://www.cadwalader.com/assets/client_friend/082112The_DCCircuitCourtVacatesCSAPR.pdf

In vacating CSAPR, the DC Circuit ruled that EPA had exceeded its statutory authority under the Clean Air Act by: (1) requiring upwind states to reduce their emissions by more than their own significant contributions to a downwind state's nonattainment; and (2) not giving states the opportunity to initially implement a system for reduction of emissions within their boundaries (i.e., by preparing a State Implementation Plan, or "SIP") before issuing a federal...