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William F. Shughart II

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SCOTUS Properly Reined in the EPA: Will the IRS and SEC Be Next?


In the last of a series of landmark rulings issued at the end of its 2021–2022 term, the US Supreme Court held that federal executive branch agencies cannot take major regulatory initiatives without explicit congressional authorization. It was the right decision.

The 6 to 3 majority determined in West Virginia et al. v. Environmental Protection Agency that the EPA’s “Clean Power Plan” (CPP), promulgated in 2015, overstepped its statutory authority by dictating that power plants must switch from coal to natural gas for generating electricity. The Court ruled that the EPA’s powers to limit carbon emissions under the Clean Air Act of 1970 (as amended in 1990) do not include the power to dictate what fuels must be used to produce electricity, a policy known as “generation shifting.”

The ruling was based on the Court’s “major questions” doctrine, which requires Congress to explicitly spell out in law administrative policy actions that have sweeping “economic and political significance.” The Obama-era Clean Power Plan presented a case in point. Citing the Clean Air Act as its authority, the Clean Power Plan set emissions limits on power plants intended to force them to switch from coal to natural gas (and later to so-called renewable energy). The EPA’s purpose, as those on the left put it, is to fight the supposed ‘existential threat’ of climate change. According to the Court’s opinion, even the EPA admitted that the CPP “would impose billions [of dollars] in compliance costs, raise retail electricity prices, require the retirement of dozens of coal plants, and eliminate tens of thousands of jobs.” A major question indeed.
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