Green Building Law Blog : Green Building Lawyer & Attorney : Shari Shapiro: Calliope Communications, LLC

 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.” 

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I have curly hair. More heat and humidity = bad hair days.  Thus, from a purely personal perspective, climate change-caused increases in temperature and intensity of storms will be, for me, a nuisance. 

Apparently, my perspective on this does not count as much as that of the Supreme Court.  Fortunately, the nine justices (well, actually, eight because Sonya Sotomayor recused herself) will be deciding whether climate change actually is a nuisance.  Today the high court announced that it will hear American Electric Power v. Connecticut. 

In the original suit, a coalition of eight states, local governments and non-profit land trusts sued major power producers alleging that the power producers had created a common-law nuisance by adding 650 million tons of carbon into the atmosphere. 

The main issue is one of my perennial favorites in the green regulation arena--federalism.  The district court determined that the case could not go forward because the suit raised political questions which were not justiciable by the courts.  The Second Circuit reversed, arguing that, while complex, the issues boiled down to basic environmental torts which had been handled by the courts in the past. The Second Circuit decision is available here.

Many Republicans have been trying to restrict the EPA's ability to regulate greenhouse gas emissions pursuant to the Clean Air Act, and Harry Reid has already announced that comprehensive energy legislation, including cap-and-trade is off the table indefinitely.

Thus, If the Supreme Court rules that regulating greenhouse gas emissions is a political question, that question has already been answered.  But if the Court decides that carbon emission is a nuisance, and capping of carbon emissions is an available remedy, the politicians will be left with little choice other than to create a compromise on how to cap carbon emissions comprehensively.  If they do not, it leaves open the opportunity for copy-cat litigation in every state and municipality across the country, with potentially differing mechanisms for capping greenhouse gas emissions.

The showdown is likely to happen in the spring, and be on the lookout for an 4-4 split, since Justice Sotomayor recused herself.   

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