On 30 June 2022, the US Supreme Court limited the authority of the Environmental Protection Agency (EPA) to enact nationwide emissions regulations on power plants with a 6-3 majority. The ruling in the West Virginia v. EPA case takes away an important tool for the reduction of greenhouse gas (GHG) emissions in the US.

The plaintiffs, consisting of several US states and coal companies, argued that overall power plant emissions across states should not be regulated by the EPA but instead decided by Congress.

“Capping carbon dioxide emissions at a level that will force a nationwide transition away from the use of coal to generate electricity may be a sensible ‘solution to the crisis of the day’,” wrote Chief Justice John Roberts. “[But] a decision of such magnitude and consequence rests with Congress itself, or an agency acting pursuant to a clear delegation from that representative body.”

In a dissenting opinion, Justice Elena Kagan said the Court “does not have a clue about how to address climate change”.

“The stakes here are high,” Kagan wrote. “Yet the Court … prevents congressionally authorised agency action to curb power plants’ carbon dioxide emissions. The Court appoints itself – instead of Congress or the expert agency – the decision-maker on climate policy. I cannot think of many things more frightening.”

The EPA on emissions: high ambition, few results

While US President Joe Biden began his tenure with battling climate change as one of his main priorities, the Court decision is just the latest setback for US climate action. Congress has been unable to pass major climate legislation such as the Build Back Better Act, which has languished since December 2021 when West Virginia Senator Joe Manchin withheld his support for it.

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Prospects for US climate action unexpectedly changed on 27 July 2022, when Manchin suddenly dropped his opposition to hundreds of billions of dollars in new spend on climate action and clean energy. This paves the way for Democrats to pass a $370bn climate and energy package, reportedly the most ambitious climate action ever taken by Congress.

The power sector is one of the largest GHG emitters in the US, with electricity production generating 25% of 2020 emissions. Around 60% of electricity generation comes from fossil fuels, mostly coal and gas. In 2021, around 21% of electricity was generated from coal, but it was responsible for almost 60% of emissions in the power sector.

In a statement following the Supreme Court ruling, EPA administrator Michael S Regan said the agency was disappointed with the decision but would not waver in its efforts towards a clean energy sector.

“We are committed to using the full scope of the EPA’s authorities to protect communities and reduce the pollution that is driving climate change,” Regan said. “Ambitious climate action presents a singular opportunity to ensure US global competitiveness, create jobs, lower costs for families, and protect people’s health and well-being, especially those who have long suffered the burden of inaction.”

President Joe Biden said in a statement that he would “continue using lawful executive authority”, including the EPA, to tackle the climate crisis.

Those statements align with the opinion of US voters, according to polling data from left-of-centre think tank Data for Progress from mid-June. Asked if they were concerned about the West Virginia v. EPA case, 35% of voters said they are ‘very concerned’. Most participants in the survey also believed the EPA should be allowed to regulate emissions from power plants, although partisanship mattered in the answers: 82% of Democrats think the EPA should be allowed to regulate, compared with 41% of Republicans.

Not all hope is lost

While a powerful tool was taken away from the EPA, it did not remove the agency’s authority to regulate emissions altogether. In 2007, the Supreme Court ruled in Massachusetts v. EPA that GHG emissions are covered under the 1970 Clean Air Act, meaning the EPA is obligated to take steps against emissions if they pose health risks. The EPA is still able to enforce regulations at individual power plants.

Most energy analysts agree that removing the EPA’s power to impose nationwide regulations will make it more difficult for the US to hit its emissions reduction targets, but not all hope for climate action is lost. Rhodium Group, a US research institute, analysed the implications of the Supreme Court’s ruling and concluded that overall it will not affect the US's prospects for its 2030 climate targets by much.

The Biden administration aims to cut 50–52% of GHG emissions from 2005 levels by 2030, with a power sector that is carbon free by 2035.

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“While the ruling certainly makes the pathway rockier, it hasn’t necessarily put the target out of reach,” said the analysis. They even found a silver lining: it clears up what actions the agency can legally take. “The Supreme Court’s decision in and of itself is unlikely to limit the potential ambition of future EPA regulations, and … it won’t [on its own] jeopardise the US’s ability to achieve the 2030 climate target.”

At the same time, the reasoning employed by the Court’s conservative majority to agree with the plaintiffs could have implications for the ability of the EPA and other agencies to address big problems going forward. The justices cited the ‘major questions doctrine’, meaning that any major issue with economical or political consequences requires authorisation by Congress, even if an agency is responsible for that particular issue. It opens the door to the doctrine being used in other cases too, said Stanford law professor David Freeman Engstrom in a discussion with law student John Priddy.

“The huge question, in our view, is where the ‘major questions doctrine’ fits within American administrative law – and just how much traction it will gain going forward,” said Engstrom. “Where will the Court – or the lower courts who must implement the Court’s decision – set the threshold for ‘economic and political significance’ in other cases? And just how aggressive will the Court be?”

Swift action is needed

To achieve its climate targets, the US government must now act swiftly. An earlier analysis by Rhodium Group found that if the US stays on its current path, the best-case scenario is a cut in GHG emissions that would get it about halfway to its 2030 target. In other words, it would fall around 1.7–2.3 billion metric tonnes of emissions reductions short.

To meet its 2030 target, according to Rhodium Group, Congress needs to pass legislation in the vein of the Build Back Better Act at an accelerated rate, in combination with climate action from federal agencies and international measures. Prospects for domestic climate action suddenly appear brighter with Manchin's change of heart on elements of what had been the Build Back Better Act.

Nevertheless, as the federal government has struggled to put goals into action, some states have made their own plans for climate action. According to the Center for Climate and Energy Solutions, a think tank, 34 states have either released a climate action plan or are in the process of revising or developing one. Currently, 28 states have set climate targets, of which eight have set net-zero targets, according to data from Net Zero Tracker.

Editor's note: The original version of this article appeared on our sister site Power Technology.

This article was updated on 28 July 2022 to mention Joe Manchin's sudden reversal on new US clean energy and climate spend, paving the way for unprecedented US climate action.