David Doniger (Natural Resources Defense Council) has posted West Virginia v. EPA, the Inflation Reduction Act, and the Future of Climate Policy on SSRN. Here is the abstract:
Two momentous events took place in summer 2022 with broad implications for the nation’s response to dangerous climate change. In June, in West Virginia v. Environmental Protection Agency, the Supreme Court formalized the “major question doctrine” and used it to invalidate the Clean Power Plan, a novel approach EPA had taken under the Clean Air Act to reduce carbon dioxide (CO2) emissions from existing power plants. In August, Congress passed and President Biden signed the Inflation Reduction Act (IRA), which provides large tax credits and grants for cleaner power generation and a renewed mandate for EPA to regulate power plant carbon pollution under the Clean Air Act.
Nearly four decades ago, in Chevron v. NRDC, the Court recognized that Congress must be able to engage the expertise and capacity of administrative agencies in order to meet complex modern problems in a timely and effective way. In West Virginia, however, the Court announced that on “major questions” – measured thus far by ill-defined and subjective criteria – Congress must legislate with far more clarity and specificity than previously demanded. The Court held that EPA may regulate power plant carbon emissions in traditional ways, but the novel approach taken in the Clean Power Plan required a clearer authorization than the Court found Congress had provided.
Six weeks later, Congress enacted the IRA, an exceptionally quick response made possible through a budgetary reconciliation procedure that avoids the Senate filibuster but cannot be often exercised. Designed in anticipation of the Court’s new clarity demands, the IRA amends the Clean Air Act to provide a clear and contemporary statement that greenhouse gases are air pollutants and to direct EPA to issue new standards. And it provides large financial incentives to defray the cost of new regulations for power companies and their customers.
This essay surveys the evolution of judicial review standards leading up to West Virginia, with special attention to the string of Supreme Court cases on EPA’s climate change authority. It critically analyzes the West Virginia decision, emphasizing the options it leaves open for EPA, as well as those it foreclosed. Finally, it explains how the IRA rejuvenates the regulatory path for EPA to act on climate change.