Supreme Court takes a sledgehammer to the EPA's ability to regulate greenhouse gases

The court ruled 6-3 that the EPA cannot use the Clean Air Act to regulate power plant greenhouse gas emissions. That leaves a patchwork of policies from states, utilities and, increasingly, tech companies to pick up the slack.

The Supreme Court at sunset sits behind fencing. Police officers are seen in silhouette near the fences.

The Supreme Court struck a major blow to the federal government's ability to regulate greenhouse gases.

Eric Lee/Bloomberg via Getty Images

Striking down the right to abortion may be the Supreme Court's highest-profile decision this term. But on Thursday, the court handed down an equally massive verdict on the federal government's ability to regulate greenhouse gas emissions. In the case of West Virginia v. EPA, the court decided that the agency has no ability to regulate greenhouse gas pollution under the Clean Air Act. Weakening the federal government's powers leaves a patchwork of states, utilities and, increasingly, tech companies to pick up the slack in reducing carbon pollution.

The court decided in a party-line 6-3 split to revoke the Environmental Protection Agency's authority to regulate greenhouse gas emissions. Chief Justice John Roberts wrote the majority opinion, while Justice Elena Kagan wrote the dissent from the court's liberal bloc. In her dissent, Kagan wrote that 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." More simply, David Pomerantz, executive director of the Energy and Policy Institute, called the decision a "tragedy."

"We've wasted so many years, [and] the task in front of us is so great with such dire consequences if we fail," he said. "We really do need every possible legal and policy lever at our disposal."

Now, one of those levers is stuck in the "off" position. The Supreme Court case that flipped it, West Virginia v. EPA, focused on the EPA's ability to regulate greenhouse gas emissions from power plants. The agency has been trying to do so ever since the Supreme Court ruled in 2007 that it could, in fact, do that under the Clean Air Act.

The agency drafted the Clean Power Plan during the Obama years — only for it to be stayed by the Supreme Court and then scrapped by the Trump EPA, which then put forth much weaker regulations. The Biden administration has promised an "all of government approach" to address climate change, but the Supreme Court ruling is tying its hands in terms of how much it can do with a sector that produces 25% of the country's greenhouse gas pollution.

That leaves a yawning chasm, which could be filled a few different ways. Federal legislation could wind down fossil fuel use while also ramping up renewables and storage through a clean energy standard. That standard was initially part of the Build Back Better Act — and also one of the key pieces that made Sen. Joe Manchin reject the legislation in its entirety, so the odds of that happening are not great. (That 50 Senate Republicans have also not lifted a finger in support of those policies shouldn't go unmentioned.)

Still, there are a quite few other avenues to make a dent in power plant carbon pollution that don't involve the federal government. States such as California have been successful in crafting strong regulations to curb carbon pollution from power plants and other sources within their borders. Utilities themselves could also take on a bigger role in speeding up decarbonizing their own power mixes.

That's not how things have traditionally worked, but that's not to say they couldn't work that way going forward. A number of utilities have adopted net-zero plans, and conglomerate NextEra recently committed to reaching "real zero" — that is, zeroing out emissions without relying on offsets — by 2045. But relying on pinky swears does not a safe climate make.

"The big utilities have tended to be followers rather than leaders, taking their [cues] from their public utility commissions or FERC," Dan Farber, a law professor at the University of California, Berkeley, said in an email. "As renewables and storage become dramatically cheaper, however, it's hard for the utilities to resist."

Pomerantz pointed to the power of public utility commissions, which exist as watchdogs to make sure utilities are operating in customers' best interests. With renewables competing as the cheapest way to generate power — especially with the recent spike in gas prices — it could mean those commissions increasingly consider climate-friendly options.

The tech industry is also an increasingly big player in the decarbonization space. A growing number of companies have said they plan to — or already do — source their electricity needs from renewables and are in the process of convincing companies that are part of their supply chains to do the same.

"The biggest contribution that tech sector can make is probably in its home territory: innovation," Farber said.

Investing in companies working on solar panels that soak up more sun, better batteries, improved transmission technology or homes that use less energy in the first place can help bring costs down further, creating a virtuous cycle. Pomerantz said the industry has another superpower, though: lobbying for climate policy.

"Part of why we got here, [to the] Supreme Court case, is a function of the political power of the fossil fuel industry," he said. "The court case was brought by Republican AGs who have been funded to do this exact thing by fossil fuel utilities, and oil, gas and coal companies for decades."

While he said campaign finance reform and other fixes needed to shore up democracy are absolutely vital as are everyday people staying engaged, "working within the system that we have, if tech companies are concerned about climate change as they purport to be, then they need to flex their own political power."

Correction: An earlier version of this story misspelled David Pomerantz's name. This story was updated on June 30, 2022.


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Photo: Carolyn Van Houten/The Washington Post via Getty Images

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The Financial Technology Association (FTA) represents industry leaders shaping the future of finance. We champion the power of technology-centered financial services and advocate for the modernization of financial regulation to support inclusion and responsible innovation.

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Photo: artpartner-images via Getty Images

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