Apr 07, 2017 - 9:00am

The Clean Power Plan is Dead! Or is it?


Senior Director, Policy for Institute for 21st Century Energy

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Factory, Arizona, Environment, Fumes, Page - Arizona
Factory, Arizona, Environment, Fumes, Page - Arizona

There certainly has been a plethora of dramatic reporting on last week’s “Promoting Energy Independence and Economic Growth” executive order signed by President Trump. Some view it as the rebirth of America’s coal industry, others say it will have little effect, and still others are lamenting the end of the planet.

In reality, while Section 4 of that Executive Order specifically directs the Environmental Protection Agency (EPA) to “take all steps necessary” to review the now infamous Clean Power Plan (CPP), the Executive Order itself does not act to change the overreaching, generation-shifting contents of the CPP. That is precisely why activist groups are not anticipated to dedicate one of their many lawsuits to opposing the Executive Order itself. Instead, the Executive Order essentially signals that the CPP is now akin to a boat, sitting in the middle of a harbor, with no engine to guide it to port. It is now up to a recentered EPA, led by former Oklahoma attorney general Scott Pruitt, to bring the boat into safe harbor.

The original CPP was highly controversial, and in our view, ineffective at having much impact on climate change. It spawned one of the most wide-ranging legal challenges in memory, filed by over 160 Petitioners – led by the U.S. Chamber and 28 states – united in opposition to the plan. Sure, there were environmental activists and some liberal-leaning states gathered in EPA’s corner, but when the drivers of America’s economy weighed in, 166 state and local business groups spoke firmly against the EPA’s plan. This broad-based opposition was based on several concerns:

  • The CPP represented an unlawful overreach, with the EPA claiming unprecedented authority over the electricity sector that is not lawful under the Clean Air Act;
  • The CPP attempted to regulate activities and investments apart from the actual power plants covered by the statute, and in many cases forced regulated facilities to close down altogether; and
  • The plan seized from the states their role under the Clean Air Act to balance a reliable and cost-effective electricity generation mix while making progress to meet heightened environmental standards.

These concerns – and others – were taken seriously by the Supreme Court, so much so that the Court took the unusual step of issuing a stay of the CPP while it is reviewed by the judicial system.

Now, we know for sure what direction the Trump Administration will be taking. The Department of Justice has already moved forward with a request to hold in abeyance – or freeze – the D.C. Circuit’s current consideration of the merits of the Clean Power Plan.

The reasoning for this pause is that if EPA is going to withdraw or fix what’s wrong with the CPP, then why continue to litigate a regulation that is no more? Article III of the Constitution typically bars federal courts from issuing advisory opinions – or opinions on cases than no longer represent an actual controversy. So, provided that the D.C. Circuit follows this view, the litigation will go dormant as the EPA reworks the plan. However, if anything has been predictable about the litigation associated with the CPP, it has been its unpredictability. Thus, nobody should count on this case going cold until the court declares it so.

Either way, the EPA now has its work cut out for it. A detailed review of the underpinnings and mandates within the plan will come next. Luckily, much of this work has been done in the voluminous briefings, pleadings, and motions that were carefully crafted in association with the litigation of the CPP.

Next, the EPA will need to repair, repeal and replace, or just simply jettison the CPP altogether. What path the EPA will take is anybody’s guess. Whatever approach the agency takes, it will have to follow the public review and comment requirements of the Clean Air Act and the Administrative Procedure Act; a fact the EPA just acknowledged. As such, a modified or repealed CPP may be months – perhaps even years – away once comment periods and the inevitable litigation have finally concluded.

The bottom line is that it seems quite likely that the CPP as it currently stands will never be implemented or enforced. From our perspective, that means that we can now get back to a more balanced discussion about continuing to make environmental progress while utilizing our domestic energy resources. Ultimately, these resources drive economic growth through increased manufacturing and lower costs to businesses and consumers. That’s good for everyone.

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About the Author

About the Author

Heath Knakmuhs
Senior Director, Policy for Institute for 21st Century Energy

Knakmuhs studies, develops, and communicates strategic energy policies and initiatives with a focus on the electric power sector. He also examines the impact of regulatory action, marketbased factors, and emerging threats on the American electric grid.