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Supreme Court Says EPA Must Regulate Greenhouse Gases From Automobiles Or Give Very Good Reasons Not To Regulate

On April 2, 2007, the United States Supreme Court issued its 5-4 decision in Massachusetts v. EPA, and effectively instructed the U.S. Environmental Protection Agency (EPA) to regulate carbon dioxide (CO2) and other “greenhouse gas” exhaust emissions from new motor vehicles.  Although the Court gave EPA the option of declining regulation under the Clean Air Act if EPA finds that emissions are not endangering public health or welfare, the majority’s opinion signals quite strongly that at least five justices view such endangerment as an established fact.  Absent a sea change in scientific opinion, then, automakers and other sources of CO2 will face regulatory controls at some time in the near future.

The Supreme Court’s majority opinion in Massachusetts v. Environmental Protection Agency, slip op., No. 05-1120, 549 U.S. –- (2007), opens as follows:

A well-documented rise in global temperatures has coincided with a significant increase in the concentration of carbon dioxide in the atmosphere.  Respected scientists believe the two trends are related.  For when carbon dioxide is released into the atmosphere, it acts like the ceiling of a greenhouse, trapping solar energy and retarding the escape of reflected heat.  It is therefore a species — the most important species — of a “greenhouse gas.”

This sets the tone for the rest of the majority opinion.  Based on scientific evidence cited at length in the opinion, five Justices (the opinion author Stevens plus Breyer, Ginsberg, Kennedy and Souter) opined that greenhouse gases are contributing to global climate change and that global climate change is creating serious and well-recognized harms to the planet.  The Court then determined that the United States Environmental Protection Agency (EPA) has authority under Section 202(a)(1) of the Clean Air Act (CAA), 42 U.S.C. §7521(a)(1), to regulate greenhouse gases (carbon dioxide (CO2), chlorofluorocarbons (CFCs), methane, and nitrous oxide) as air pollutants when emitted from new motor vehicle exhaust systems.

Finally, the Court held that EPA has a duty to regulate greenhouse gas emissions from new motor vehicles if EPA finds that such greenhouse gases endanger public health or welfare.  EPA may decline as a policy matter to regulate such emissions, but only if EPA determines that no endangerment exists or if it has insufficient information to make that endangerment decision.  Further, in making that determination, EPA cannot base its judgment on other executive branch initiatives to address or reduce greenhouse gas emissions or global climate change; scientific uncertainties regarding climate change factors; or the efficacy or appropriateness of automobile regulation to address climate change.  EPA has cited these factors in recent years as justifying its refusal to regulate greenhouse gases.  Under the Court’s analysis, however, the only question left to EPA’s statutory discretion is whether sufficient information exists for EPA to determine that greenhouse gases do or do not endanger public health or welfare.

Background of the Case

In the late 1990’s it became clear that the United States likely would not ratify the Kyoto Protocol for greenhouse gas reductions.  Some members of Congress became concerned that EPA (then operating under the Clinton administration), might try nonetheless to implement features of the Protocol via administrative regulation.  During hearings in 1998 and 1999, congressional representatives asked EPA if EPA believed it had authority under the CAA to regulate CO2.  EPA’s Office of General Counsel responded affirmatively – EPA had authority to regulate CO2 as an air pollutant under the CAA –  but also indicated that EPA had not yet decided whether CO2 met the statutory criteria for regulation.

In October 1999, a number of environmental interest groups petitioned EPA for a rulemaking under Section 202(a)(1) of the CAA to regulate CO2 and other greenhouse gases from new motor vehicles.  EPA sat on the petition for fifteen months, and then opened an administrative record for public comment.  EPA received more than 50,000 comments in five months.  On September 8, 2003, EPA denied the rulemaking petition, citing as its reasons that:  (1) contrary to the opinions of its by-then former general counsels, the CAA does not authorize EPA to issue mandatory regulations to address global climate change; and (2) even if EPA had the authority to set greenhouse gas emission standards, it would be unwise to do so.

Following this denial, Massachusetts and eleven other states and environmental interest groups challenged EPA’s rejection of the rulemaking petition.  A fractured three-judge panel of the D.C. Circuit Court of Appeals upheld EPA’s denial decision.  Massachusetts v. EPA, 415 F.3d 50 (D.C. Cir. 2005), reh’g denied en banc, 433 F.3d 66 (D.C. Cir. 2005).  The United States Supreme Court granted certiorari June 26, 2006.  126 S.Ct. 2960.  Much of the briefing and oral argument focused on whether the petitioners had standing to pursue their claim.

The Statutory Language   

Section 202(a)(1) of the Clean Air Act provides: 

  • The [EPA] Administrator shall by regulation prescribe (and from time to time revise) in accordance with the provisions of this section, standards applicable to the emission of any air pollutant from any class or classes of new motor vehicles or new motor vehicle engines, which in his judgment cause, or contribute to, air pollution which may reasonably be anticipated to endanger public health or welfare. . . .”

42 U.S.C. §7521(a)(1). 

Section 302(g) of the Act defines “air pollutant” as including “any air pollution agent or combination of such agents, including any physical, chemical, biological, radioactive .  .  . substance or matter which is emitted into or otherwise enters the ambient air.”   42 U.S.C. §7602(g).  “Public health” is undefined, but Section 302(h) provides a broad definition of “welfare”:

  • All language referring to effects on welfare includes, but is not limited to, effects on soils, water, crops, vegetation, manmade materials, animals, wildlife, weather, visibility, and climate, damage to and deterioration of property, and hazards to transportation, as well as effects on economic values and on personal comfort and well-being, whether caused by transformation, conversion, or combination with other air pollutants.

42 U.S.C. §7602(h) (emphasis added).

The Court’s Decision

Before reaching the merits of the petitioners’ objections, the Court first had to decide whether any petitioner could bring the claim before the Court at all – whether any of the petitioners had standing.  This notion of who has status to file a legal claim in the first instance – who has “standing” – is a critical but often overlooked procedural hurdle to those who want to challenge government decisions.  The recent trend has been for courts to be less inclined to find that complainants have the standing needed to bring lawsuits challenging environmental and other regulations.  The Court’s majority ruling on this standing issue may turn out to be the most important aspect of the decision.

In response to the Massachusetts v. EPA petitioners’ claims, EPA asserted that the harms inflicted by greenhouse gases are general and widespread, and that because no individual person, organization or government entity suffers more than any other, there was no justiciable “case or controversy” to which standing could attach.  The Court disagreed.  “At bottom, the ‘gist of the question of standing’ is whether petitioners have ‘such a personal stake in the outcome of the controversy as to assure that concrete adverseness which sharpens the presentation of issues upon which the court so largely depends for illumination.’”  549 U.S. at *13-14, quoting Baker v. Carr, 369 U. S. 186, 204 (1962).

The majority found the interests of the Commonwealth of Massachusetts sufficient to convey standing.  “It is of considerable relevance that the party seeking review here is a sovereign

State. . . .”  549 U.S. at *15.   As a sovereign state, Massachusetts has an interest in preserving its coastlines and coastal resources from the effects predicted to result from global climate change, and a current and future injury resulting from rising sea levels.  549 U.S. at *19-20.

EPA also argued that emissions from motor vehicles contribute only an insignificant amount to global greenhouse gases, making any regulations to control such greenhouse gas emissions incapable of redressing Massachusetts’ purported injury.  This was particularly important, according to EPA, in light of the existence of other, larger, and even global sources of greenhouse gases, such as current and future planned power plants in China and India.

Again, the Court was not persuaded.

While it may be true that regulating motor-vehicle emissions will not by itself reverse global warming, it by no means follows that we lack jurisdiction to decide whether EPA has a duty to take steps to slow or reduce it.  Because of the enormity of the potential consequences associated with man-made climate change, the fact that the effectiveness of a remedy might be delayed during the (relatively short) time it takes for a new motor-vehicle fleet to replace an older one is essentially irrelevant.  Nor is it dispositive that developing countries such as China and India are poised to increase greenhouse gas emissions substantially over the next century: A reduction in domestic emissions would slow the pace of global emissions increases, no matter what happens elsewhere.

549 U.S. at *22 (citations and footnote omitted).

Finally, the Court responded to the merits of EPA’s denial of the requested petition for rulemaking.  EPA based the rulemaking denial on its determinations that it either had no authority to regulate CO2 and other greenhouse gases, or if it had such authority, that it was “unwise to do so at this time.”  The Court held that first, under a plain language interpretation of the CAA, greenhouse gases, including CO2, clearly fall within the statutory definition of air pollutants.  “[T]he definition embraces all airborne compounds of whatever stripe . . . ”  549 U.S. at *26.

Second, the Court found fault in all the reasons voiced by EPA for its decision not to regulate “at this time:”  other executive branch initiatives to address or reduce greenhouse gas emissions or global climate change; scientific uncertainties regarding climate change factors; and the lack of efficacy or appropriateness of automobile regulation to address climate change.

Although we have neither the expertise nor the authority to evaluate these policy judgments, it is evident they have nothing to do with whether greenhouse gas emissions contribute to climate change. Still less do they amount to a reasoned justification for declining to form a scientific judgment.

549 U.S. at *31.  The only issue left to EPA’s statutory discretion, according to the Court, was whether sufficient information exists for EPA to determine that greenhouse gases do or do not endanger public health or welfare.  Because EPA had “offered no reasoned explanation for its refusal to decide whether greenhouse gases cause or contribute to climate change,” EPA’s denial of the requested rulemaking petition was arbitrary, capricious or otherwise not in accordance with law, and so required remand back to the Agency.  549 U.S. at *32.

Justice Roberts dissented (joined by Justices Scalia, Thomas, and Alito), arguing that the case should have been rejected because no petitioner had standing.  Justice Scalia also filed a separate dissenting opinion (joined by Justices Roberts, Thomas and Alito) indicating that he would rule in EPA’s favor because EPA had the discretion to decline to regulate automobile greenhouse gas emissions for many reasons, including, among others, finding that the Clean Air Act does not regulate CO2 as an air pollutant.  In Justice Scalia’s own words:

Not only is EPA’s interpretation reasonable, it is far more plausible than the Court’s alternative.  As the Court correctly points out, “all airborne compounds of whatever stripe,” ante, at 26, would qualify as “physical, chemical, . . . substance[s] or matter which [are] emitted into or otherwise ente[r] the ambient air,” 42 U. S. C. §7602(g).  It follows that everything airborne, from Frisbees to flatulence, qualifies as an “air pollutant.”  This reading of the statute defies common sense.

Scalia, dissenting, 549 U.S. at *10, FN2.

What Happens Next?

The impacts of the majority’s opinion in Massachusetts v. EPA are likely to be many and varied.  First, the Court’s decision cited extensively to scientific, governmental and international investigations and reports on climate change and greenhouse gas emissions.  As expected, given the appellate nature of the proceedings, most of the reports cited by the Court date from the 1970’s to the early 2000’s.  One of the Court’s main scientific sources was the Intergovernmental Panel on Climate Change (IPCC).

As of April 2007, the IPCC is in the process of issuing its fourth round of climate change assessment reports.  The first phase (Working Group I) of the 2007 report was released in February ( http://ipcc-wg1.ucar.edu/wg1/docs/WG1AR4_SPM_Approved_05Feb.pdf).  In this report, the international scientific community declared themselves 90 percent sure that the observed increases in atmospheric greenhouse gases are due to “anthropogenic activities,” predominantly agriculture and fossil fuel use.

The IPCC Working Group II released the second phase of the 2007 report on April 6, the Friday following the Court’s Monday decision in Massachusetts v. EPA.  It can be viewed at http://www.ipcc-wg2.org/index.html.  The Working Group II report predicts climate change impacts, adaptations and vulnerabilities in nature and on human communities.  The international scientists anticipate continuing increases in overall global temperatures, the possible extinction of twenty to thirty percent of all plant and animal species, and millions of people facing higher risk of flooding and hurricanes, increases in disease and malnourishment.  The most significant impacts will be felt by communities least able to adapt – the world’s poor. 

The IPCC Working Group III released yet another phase of the 2007 report on May 4, 2007  (http://www.ipcc.ch/SPM040507.pdf).  This document deals with mitigation options to reduce the impacts of climate change.  The report concludes that under current mitigation policies, greenhouse gas emissions will continue to rise.  The authors then postulate various costs associated with increased mitigation efforts to stabilize global greenhouse gas levels, and concludes that stabilization can be achieved by the year 2100 at a global gross domestic production (GGDP) cost of minus 3% or less by the year 2030.  Phrased differently, they believe that stabilization can be achieved at a cost equivalence of $0.50 to $1.00 per gallon of gasoline, or a carbon price of $20 to $100 per ton of CO2 emitted. Some of the IPCC’s models predict no GGDP reduction or even GGDP increases if sufficient funds are dedicated to research and development of new carbon sequestration/sinks and greenhouse gas capture technologies.  The report also concludes that the co-benefits of greenhouse gas reduction (reduced air pollution and increased health, reduced energy use and increased energy security, reduced ecosystem pressure and increased agricultural production) could cancel out much of the greenhouse gas mitigation costs.     

Given the Supreme Court’s reliance on earlier IPCC reports, many expect that the 2007 IPCC Working Group reports and a “synthesis report” to be issued in November 2007 also will receive attention from the Court in any future climate change/greenhouse gas cases.  This deference may flow down to the federal Courts of Appeal and the District Courts and should be taken into consideration by litigants.

Second, analysts are already parsing the standing analysis in Massachusetts v. EPA for use in other environmental and policy disputes.  In his dissent, Justice Roberts claims that the majority’s decision represents a dramatic relaxation of the standing requirements applicable to the states.   The truth of this proposition may be played out in suits filed by states as plaintiffs against electric power plants to reduce CO2 emissions in Oregon, Washington, Massachusetts, and New Hampshire.

Finally, the states may decide to regulate greenhouse gas emissions without waiting for national standards from EPA.  Indeed, in 2002 California passed a law classifying CO2 as an air pollutant and imposing emission limits on motor vehicles.  Vermont and nine other states followed California’s lead.  On April 4, a Vermont district court judge relied on Massachusetts v. EPA and allowed trial to proceed on a suit seeking to block Vermont’s greenhouse gas tailpipe emission regulations.  Green Mountain Chrysler Plymouth Dodge Jeep v. Crombie, Cause No. 2:05-cv-302-wks (D. Vt.).  Trial briefs were filed April 6 and a sixteen day bench trial ended on May 8.  Post trial briefs are due June 8.