U.S. Supreme Court upholds power plant pollution rule; Texas led opposition

The U.S. Supreme Court bolstered President Barack Obama’s environmental agenda, upholding a rule designed to curb emissions from coal-fired power plants in 28 states.

The justices, voting 6-2 to overturn a lower court, said the rule was within the Environmental Protection Agency’s authority under the Clean Air Act. The regulation targets air pollution that crosses state lines.

The decision may prompt utilities such as Southern Co. and American Electric Power Co. to shutter coal-fired power plants, as it would require them to install more pollution-control systems, according to Rob Barnett, an energy analyst for Bloomberg Government. The administration says the rule will prevent as many as 34,000 premature deaths a year.

Attorneys general from 14 states, led by Texas, challenged the rule alongside Energy Future Holdings Corp.’s Luminant, Entergy Corp., Edison International, Peabody Energy Corp., AEP, Southern and the United Mine Workers of America.

The rule uses a modified cap-and-trade system to limit emissions of sulfur dioxide and nitrogen oxide in 28 states whose pollution blows into neighboring jurisdictions. All are in the eastern two-thirds of the U.S. A cap-and-trade system would create a limited number of pollution permits that companies could trade or sell.

Rule Rejected

A federal appeals court in Washington rejected the cross- state pollution rule. The panel ordered the agency to continue to enforce a 2005 measure known as the Clean Air Interstate Rule until a viable replacement to the cross-state regulation could be issued. The Obama administration said that process could take years.

The companies said the EPA improperly focused on the cost of emission reductions, rather than basing its rule solely on the amount of pollutants created in each state.

Writing for the court today, Justice Ruth Bader Ginsburg said the EPA’s approach is a “permissible, workable and equitable interpretation” of the Clean Air Act.

Justices Antonin Scalia and Clarence Thomas dissented. Justice Samuel Alito didn’t take part in the case. As is custom, he didn’t give a reason.

The states also argued unsuccessfully that the EPA didn’t give them a chance to put in place their own pollution-reduction plans before imposing a nationwide standard.

Good Neighbor

The EPA rule aimed to implement what is known as the “good neighbor” provision of the Clean Air Act. That requires states to cut emissions that “contribute significantly” to pollution in another state.

The EPA rule targets sulfur dioxide, which can lead to acid rain and soot harmful to humans and ecosystems, and nitrogen oxide, a component of ground-level ozone and a main ingredient of smog. Coal accounts for 98 percent of sulfur dioxide and 92 percent of nitrogen oxide released into the air by power plants, according to the EPA.