On June 30, 2022, the U.S. Supreme Court ended twenty years of efforts by the Environmental Protection Agency (“EPA”) and environmental groups, (jointly “the environmental community”) to use the vague language in numerous environmental laws to regulate almost every aspect of life in the United States. Upon reading the U.S. Supreme Court’s groundbreaking opinion in West Virginia vs Environmental Protection Agency  (“West Virginia case”), I could only think of the words of Martin Luther King, “Free at last, thank God Almighty, we are free at last” from the environmental community’s reign of regulatory terror.

The West Virginia case involved EPA’s use of the “vague language of a long-extant, but rarely used, statute” as authority to regulate major economic and political issues without congressional authorization. Specifically, EPA was relying on section 111 of the Clean Air Act (“CAA”) to impose a cap-and-trade scheme for carbon emissions on the utility industry. The Supreme Court could have easily resolved the controversy over EPA’s “new found authority” by applying the rules of statutory construction. Such a ruling would have been very narrow. Even if the court ruled against EPA, the narrowness of the ruling would have permitted EPA to propose many more such schemes using different “new found powers.” Fortunately, however, the court recognized the issue was more than a power-hungry EPA, it was a power-hungry federal government that needed checking.

The court noted, it rejected the Biden administration’s use of the Occupational Safety and Health Act (“OSHA”) to mandate 84 million Americans either obtain a Covid-19 vaccine or submit to weekly testing. It also discussed its rejection of the Centers for Disease Control and Prevention’s asserted authority to impose a nationwide eviction moratorium to stem the spread of Covid. Recognizing that federal agencies “were asserting highly consequential power beyond what Congress could reasonably be understood to have granted,” it took up the climate change case.

EPA’s massive regulatory scheme to regulate climate change made it easy for the court to formally announce the “Major Question Doctrine.” It held that regulatory agencies can only act on matters of economic and political significance if the agency… point[s] to “clear congressional authority.” Moreover, “Agencies have only those powers given to them by Congress, and ‘enabling legislation’ is generally not an ‘open book’ to which the agency may add pages and change the plot line.”

While the environmental community had some successes in its efforts to impose law by judicial fiat, Executive Order and by regulation, the West Virginia case put all those genies back in the proverbial bottle.

 

The Supreme Court highlights Congress consistently rejecting climate legislation

The court wrote, “Congress, however, has consistently rejected proposals to amend the Clean Air Act to create such a program [regulating climate change].” It cited the American Clean Energy and Security Act of 2009, the Clean Energy Jobs and American Power Act of 2009, the Climate Protection Act of 2011, and Save our Climate Act of 2011. The Supreme Court was kind to the environmental community. There were many more failed attempts by the environmental community to enact a comprehensive legal structure to address climate change: The Kyoto Protocol (Senate voted 95-0 against ratification), The Paris Agreement (Lacking votes, it was never submitted as a Treaty); McCain-Lieberman, Kerry-Lieberman-Graham, and others that never received a vote. Congress clearly spoke. Unfortunately, the environmental community was, and is likely, still not willing to abide by the outcome of a democratic debate.

The environmental community viewed shopping for judges the same as shopping for shoes, pick the ones you like.

As the environmental community realized Congress would not impose a massive climate change scheme on American society, it orchestrated a well-funded, highly coordinated,  nationwide litigation campaign to persuade courts to impose such a system. It filed lawsuits across the nation under any statute that might relate to climate change – Clean Air Act, (186), Endangered Species and other wildlife statutes (174), National Environmental Protection Act (322), Clean Water Act (58), miscellaneous land use statutes (168), constitutional claims under the Commerce Clause (20), First, Fifth and Fourteenth Amendments (41); under state laws (464), common law (29), public trust (27) and securities and financial statutes (24).

 

When legislation and lawsuits fail, it is time for the superficial power of Executive Orders

Executive Orders are nothing more than orders of the president to the executive branch of government. The reach of such orders is limited to federal operations. But desperate times call for desperate measures. Since the environmental community failed to persuade Congress and most courts of their righteousness of belief, they needed a “Hail Mary.” On Biden’s first day in office, he issued several Executive Orders to address climate change. He further directed all executive departments to place a moratorium on oil and gas leasing and fabricated a calculation of the Social Cost of Carbon to justify the high cost of climate change regulations.

A week later, Biden ordered a whole-of-government approach to address climate change. The approach resulted in agencies like the Securities and Exchange Commission, which regulates the stock market, proposing climate disclosure rules to force all public companies to provide detailed reporting on climate risks and emissions. On related matters, the financial regulators were pressured to deny financing to fossil fuel companies, some of our biggest corporations.

 “God’s timing is always perfect. Trust his delays” Tony Evans

In 2009 EPA was finalizing rules to implement its “Endangerment Finding,” i.e.; greenhouse gases contribute to man-made climate change that may endanger public health and welfare. The U.S. Chamber of Commerce, supported by several business organizations, petitioned the agency to rescind its Endangerment Findings for a failure to disclose the data supporting the Endangerment Finding and for lacking statutory authority. It was believed EPA’s data was not peer-reviewed as required under the Information Quality Act (“IQA”) to determine its objectivity and level of its uncertainty. These were reasonable requests considering EPA was seeking to regulate the entire U.S. economy.  EPA summarily denied the petition. Those believing EPA’s data was seriously flawed and in need of cross-examination, recommended that the chamber file suit against EPA.

The environmental community attacked the chamber asserting a trial seeking access to the data was a modern-day “Scopes Monkey trial.” Concurrently, the then leader of the chamber was being pressured not to file the lawsuit. A few chamber members who benefitted from the government’s climate subsidies publicly dropped their membership to protest the mere consideration of a lawsuit. The then Administrator of EPA requested a private, confidential breakfast with the Chamber’s leader. The pressure became too great and the Chamber’s leader declined to file the lawsuit challenging EPA’s Endangerment Findings. That lawsuit was the last opportunity for the opponents of the Endangerment Findings to stop it from going final. Since the suit was not filed, EPA finalized the Endangerment Findings, thereby establishing, the findings as the scientific foundation for climate change without being subject to IQA, cross – examination or the release of all relevant and material data.

While opponents of future regulations could still make administrative law challenges to future proposed climate rules, the scientific foundation (Endangerment Findings) was deemed fact, thereby making such challenges problematic.

EPA had full roaming rights over the regulatory process between 2010 – 2016. The Supreme Court in that time period was liberal in philosophy, supported big government, and a staunchly pro-regulatory court by a 6-3 or 5-4 margin, depending on how the wind was blowing the chief’s hair that day. Had a case questioning the legality of agency regulatory overreach reached that court, it very likely would have ruled that EPA had the power to craft any regulation necessary to control climate change.

What the vanquished could not know during the many years in regulatory hell, was a fortuitous series of events would reverse their fate. A man named Trump would be sworn in as president in 2017. He would be able to appoint three new justices to the court in one term, thereby reversing the court’s judicial philosophy from liberal to conservative. The conservative court was willing to check the administrative state.

The Supreme Court imposes regulatory sanity

With the Endangerment Finding being final, Obama’s EPA finalized its cap-and-trade emissions scheme which it called the Clean Power Plan (“CPP”). EPA’s legal support rested on section 111 of the CAA and its scientific support rested in the Endangerment Findings. Litigation was initiated against the CPP and it continued throughout the Obama, Trump and Biden administrations, with no resolution of the issue.

Shortly after the election of President Trump, his EPA repealed the CPP and put in its place the Affordable Clean Energy rule that limited EPA’s regulatory power to available emission reduction technologies. On Trump’s last day in office the DC Circuit Court of Appeals vacated the Trump rule, however, before President Biden could reinstate a new CPP rule, the Supreme Court accepted the case for review.

What is remarkable about the West Virginia case is with all the procedural wrangling throughout three presidential administrations, the CPP never went into effect due to judicial stays and reversals. With climate change regulation causing regulatory chaos, the conservative Supreme Court realized it must address the scope of agency power to preserve the Constitution. It did so without reviewing the science of climate change as contained in the Endangerment Finding. Rather, by examining how EPA was manipulating the regulatory process to make new law without Congress, the court found a way to address the most significant issue posed by the regulatory state – agencies exercising legislative power without congressional authorization.

While the Supreme Court held that “Congress could not have intended to delegate a decision of such economic and political significance (regulation of climate change) to an agency [EPA] in so cryptic of a fashion,” its decision applies to all agencies that enact major political and economic matters without “clear congressional authority.” Clearly the court was signaling to all federal agencies, e.g.; OSHA and CDC, that they cannot regulate beyond the powers given them by Congress.

Had the environmental community been successful in expanding the authority of agencies to regulate climate change without statutory authorization, many agencies would search for and find “long-extant authorities” to further diminish the role of Congress. By affirming the role of Congress, the Supreme Court clearly reinforces the constitutional separation of powers, a structure in which Congress is the lawmaker, not agencies.

What is so mystifying about the long battle over the power of EPA to regulate climate change is the ironic ending to the struggle. In the end, EPA’s aggressive regulatory overreach resulted in limits being placed on the regulatory powers of all federal agencies.

William L. Kovacs served as senior vice president at the U.S. Chamber of Commerce and led the organization’s successful opposition to the environmental community’s costly climate change legislative proposals from 1998 to 2017. His book, Reform the Kakistocracy, is the winner of the 2021 Independent Press Award for Political/Social Change.

This article was initially published in the August 2022 edition of Reality News