Supreme Court Rules In Industry's Favor. What's EPA's Next Move?

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A plume of steam billows from the coal-fired Merrimack Station in Bow, N.H. in January 2015. (AP)
A plume of steam billows from the coal-fired Merrimack Station in Bow, N.H. in January 2015. (AP)

The U.S. Supreme Court ruled Monday that the Environmental Protection Agency made a mistake when it told electric power plants to reduce mercury emissions. The high court says the EPA should first have considered how much it would cost power plants to do that.

The decision comes too late for most power companies, but it could affect future EPA regulations.

Mercury in the air is a health risk. When you burn coal or oil, you create airborne mercury that can end up in fish we eat and cause serious health problems.

In 1990 Congress advised the EPA to use the Clean Air Act to limit mercury. The agency set rules for many industries, like cement makers and waste incinerators. Eventually, the EPA also added power plants to the list, and most of these plants began to reduce their mercury emissions.

But many also sued — along with the coal industry and more than 20 states. They argued that the EPA should not decide to adopt expensive new regulations without first considering what implementing those rules would cost them. In essence, via Monday's decision in Michigan v. Environmental Protection Agency, the Supreme Court told the coal industry (in a 5 to 4 vote), "You're right." Justice Antonin Scalia wrote the majority opinion.

Jeff Holmstead is a former senior EPA official and an attorney with the law firm Bracewell and Giuliani, which represents utilities. He says the ruling is narrow, but the court clearly rebuked the EPA. "Before it decides to regulate something," he says, paraphrasing the high court, "sometimes it needs to take into account the cost of those regulations. It can't just turn a blind eye."

Now, this ruling only applies to the Clean Air Act and its mercury standards. But Holmstead says it could affect future EPA regulations. Here's why: Usually companies still have to comply with regulations even while they're fighting them within the court system. In the case of mercury, industry spent billions to comply even while it was suing to stop the new rules. And, even though the nation's top court didn't throw the regulations out, it said EPA has to reconsider its decision on costs.

So, Holmstead says, businesses may now cite this ruling to insist that the EPA wait for the courts before enforcing new rules. "While you're going through that process [of litigation]," he says, "you need to put the regulation on hold. And what happened today certainly makes it much more likely."

The ruling apparently comes too late for those power plants that have already made plans to install equipment to cut mercury. And Ann Weeks, legal director of the Clean Air Task Force, an environmental advocacy group, says that's not likely to be reversed. "The horse is out of the barn," she says. "The protections already are rolling forward and utilities are making decisions accordingly."

Weeks points out that the EPA eventually did do a cost-benefit analysis, years after it decided to regulate mercury. The Supreme Court says that was too late. But Weeks says the EPA did set the dollar value of the public health benefits at nine times the cost to industry of complying. She says that calculation clearly justifies regulating the industry, and she expects that the EPA will continue do so.

"Obviously," Weeks says, "we are all going to work to make sure that some kind of protection remains in place while EPA does its consideration that it has to do now."

The high court says that consideration must take place in the U.S. Court of Appeals, District of Columbia Circuit. Weeks says it's possible the EPA will have to do another cost analysis. In the meantime, the battle over rules governing mercury emissions at power plants enters its 26th year.

Copyright 2015 NPR. To see more, visit http://www.npr.org/.

Copyright NPR. View this article on npr.org.

Transcript

ROBERT SIEGEL, HOST:

The United States Supreme Court has ruled that the EPA made a mistake when it told electric power plants to reduce mercury emissions. The high court said the agency should have first considered how much it would cost power plants to do that. As NPR's Christopher Joyce reports, the decision comes too late for most power companies, but it could affect future regulations.

CHRISTOPHER JOYCE, BYLINE: When you burn coal or oil, you create airborne mercury. It's toxic and can end up in fish we eat. In 1990, Congress advised EPA to use the Clean Air Act to limit mercury. The agency set rules for many industries like cement makers and waste incinerators. Then EPA eventually added power plants, and most reduced their mercury emissions. But many also sued, along with the coal industry, in over 20 states. They said the EPA should not decide to adopt expensive new regulations without first considering what it will cost us. In its decision in Michigan versus EPA, the Supreme Court said to industry, you're right. Jeff Holmstead is an attorney with Bracewell and Guliani which represents utilities. He says the ruling is narrow, but the court clearly rebuked EPA.

JEFF HOLMSTEAD: Before it decides to regulate something, it needs to take into account the cost of those regulations. It can't just turn a blind eye.

JOYCE: Now, this ruling only applies to the Clean Air Act and its mercury standards, but Holmstead says it could affect future EPA regulations. Here's why. Usually companies still have to comply with regulations even while they're fighting them in court. In the case of mercury, industry spent billions to comply even while they were suing to stop them. And even though the court didn't throw the regulations out, it said EPA has to start over now. Holmstead says now businesses may insist that EPA wait for the courts before enforcing new rules.

HOLMSTEAD: While you're going through that process, you need to put the regulation on hold, and what happened today certainly makes it much more likely.

JOYCE: But the ruling comes too late for those power plants that have already made plans to install equipment to cut mercury. And Ann Weeks of the Clean Air Task Force says that's not likely to be reversed.

ANN WEEKS: The horse is out of the barn. The protection's already are rolling forward, and utilities are making decisions accordingly.

JOYCE: Weeks points out that the EPA eventually did do a cost-benefit analysis years after it decided to regulate mercury. The Supreme Court said that was too late. But she says EPA did set the dollar value of the public health benefits at nine times the cost to industry of complying. She says that clearly justifies regulating the industry and expects EPA will continue to do so.

WEEKS: Obviously we are all going to work to make sure that, you know, some kind of protection remains in place while EPA does its consideration that it has to do now.

JOYCE: The high court says that consideration must take place at the circuit court for the District of Columbia Weeks says it's possible the EPA will have to do another cost analysis. Christopher Joyce, NPR News. Transcript provided by NPR, Copyright NPR.