Stay-ing Alive: Staying Clean Power Plan compliance may derail it permanently

There is chatter that the Clean Power Plan Final Rule will be released in early August, but also a strong effort to delay implementation until the various legal challenges are resolved. The stay could be imposed either judicially or legislatively. A bill passed the House and is currently pending in the Senate that would allow states to delay writing implementation plans until judicial review has concluded. A judicial stay could also be imposed. Given that the wheels of justice grind slowly, a stay could destroy the effectiveness of the CPP. Currently, the states' plans are due in 2016. If a stay is in place, the plans would be potentially delayed until after the next presidential election. The next president may or may not support the CPP, and could abandon it altogether. Even if executive support does not wane, the position of some states in complying with the law may. For example, in Pennsylvania, Republican Governor Tom Corbett was a leading voice opposing the CPP, and Pennsylvania passed a law requiring legislative approval of a CPP compliance plan. In 2014, however, Democratic Governor Tom Wolf was elected, and he is very supportive of the CPP, and Pennsylvania is developing its plan to comply. A change in state legislature or administrative make-up could easily go the other way. Moreover, the emissions reductions are measured at 2020 and 2030. If plans are delayed until after 2016, states will have a difficult, if not impossible, task of meeting the 30% emissions reduction target by the current dates. The rule compliance dates would have to shift, which could open up the CPP to more changes and further delays. The stay strategy is quite clever. Inertia is a powerful force. Once plans are submitted and underway, it will be much harder to derail the entire CPP framework. Economic incentives will change, and industries/jobs will grow around the new areas of investment. So, if a stay is put in place (most likely a judicial stay, because it is unlikely that Obama would sign a legislative stay), the CPP will face an uncertain future.

Taking A Cue From The LGBT Community, EPA Needs To Focus On Creating A Receptive Audience For Its Clean Power Plan

 Both Michigan v. EPA and Obergefell v. Hodges demonstrate a key learning about governance in America—context matters as much as, or perhaps more, than legal authority.

In 1998, the Environmental Protection Agency (EPA) decided to regulate mercury emissions. EPA apparently did not do a formal cost-benefit analysis (CBA) comparing the benefits to health, etc. with the economic impact on the power industry. However, EPA did submit a “Regulatory Impact Analysis” that estimated the regulation would cost the power industry $9.6 billion per year, for an apparently meager benefit of $4-$6 million per year.

When the mercury rule was challenged on the grounds that EPA had failed to perform a CBA, EPA argued that it was not required to do a CBA under the Clean Air Act, and that EPA did many cost-benefit analyses when implementing the regulation.

Justice Scalia, writing for the majority, held that EPA was obligated to do a CBA in deciding whether to regulate mercury emissions, and therefore the mercury regulations were invalid despite subsequent CBAs.

The LGBT community fought for years ahead of and during the same-sex marriage movement to build public approval of its cause, and to marshal factual evidence to neutralize its opposition’s arguments. Once the Obergefell reached the Supreme Court, the justices were faced with unassailable facts, and to take the transformed social context into consideration. In other words, same-sex marriage became a “no brainer.”

By contrast, in Michigan, EPA appears to have embarked on a battle with the coal industry without taking the regulatory context into consideration. EPA had to have known that the power industry was going to attack the EPA on the cost of its regulations. Without robust evidence to counteract that argument, the EPA left itself open to just the type of challenge brought in Michigan. Even if the EPA were under no obligation to do a CBA, it would have been wise to shore up its defenses from such an obvious line of attack, particularly when the Regulatory Impact Analysis showed a wide disparity in costs and benefits.

Further, given the regulatory environment where the public is regularly exposed to discussion (right or wrong) about the “excessive” costs of regulation. Advancing an argument that EPA does not have to do a cost-benefit analysis in deciding to regulate would not resonate with the public, and did not resonate with the Court.

The scope of regulatory authority is not the only thing agencies need to consider when regulating. The political and social environment is as important, or perhaps more so, than the jurisdictional boundaries of the law.

The EPA should take this education into the roll-out of the Clean Power Plan. EPA must have a sharp eye to measuring and articulating the costs and benefits of the state plans to reduce carbon emissions. In addition, EPA needs to radically ramp up its communications strategy, so that when the Supreme Court has to rule on the implementation of the Clean Power Plan, it’s a “no brainer.”