In a 6 to 2 decision, with Justice Alito not participating, the U.S. Supreme Court ruled that the EPA’s highly consequential Cross State Air Pollution Rule (CSAPR) legitimately directed upwind states to reduce their significant contributions to pollution that impairs the ability of downwind states to attain certain national ambient air quality standards (NAAQS). 

In an opinion written by Justice Ginsburg, the majority recognized the task the Agency faced in factoring into the CSAPR “overlapping and interwoven linkages between upwind and downwind States [that] number in the thousands.” 

Accordingly, the majority held that the approach the EPA applied in the CSAPR, which did not assign proporational pollution budgets to individual states, was acceptable under the CAA’s Good Neighbor Provision. 

The ruling reverses a 2 to 1 ruling against the CSAPR issued by the U.S. Court of Appeals for the D.C. Circuit. 

D.C. Circuit opinion

In the case (EPA et al. v. EME Homer City Generation et al.), industry, states, and labor groups challenged the CSAPR on the grounds that the EPA issued federal implementation plans (FIP) that required upwind states to control their significant contributions to downwind pollution based on the use of cost-effective measures rather than on the specific amount of pollution emanating from individual states and its specific effects on attainment in downwind states.  The plaintiffs argued that the EPA’s approach would result in states over-controlling their sources of emissions.  The D.C. Circuit majority agreed and vacated the CSAPR in its entirety.

SIPs and FIPs

First, the Supreme Court addressed the D.C. Circuit majority ruling on the EPA’s authority to issue federal implementation plans (FIP) to states whose state implementation plans (SIP) addressing the Clean Air Act’s Good Neighbor Provision were disapproved by the Agency.  Under the statute, once the EPA has disapproved a SIP, the state has 2 years to provide a revision.  But the CAA indicates that following a disapproval, the EPA may at any time issue a FIP that the state must follow. 

The D.C. Circuit majority interpreted this provision to mean that the EPA could not issue FIPs until it provided individual upwind states with information regarding their significant contributions to air pollution in downwind states.  The D.C. Circuit reasoned that states could not write adequate SIPs without this information.  

The Supreme Court disagreed.  Citing the CAA’s plain text, Justice Ginsburg writes that the EPA is “not obliged to wait two years or postpone its action even a single day.”  Further, says Ginsburg, when Congress elected to make EPA’s input a prerequisite to the development of SIPs, it did so expressly.  For example, states developing vehicle inspection and maintenance programs must await the EPA’s guidance before issuing SIPs.  But there is nothing in the statute imposing this same type of responsibility on the EPA regarding the Good Neighbor Policy. 

“By altering Congress’ SIP and FIP schedule, the D C Circuit allowed a delay Congress did not order and placed an information submission obligation on EPA Congress did not impose,” wrote Ginsberg.

Proportional contribution

Second, the Supreme Court majority addressed the D.C. Circuit’s contention that the EPA allocate responsibility for reducing emissions in a “manner proportional to” each state’s contribution” to the problem. 

“Nothing in the Good Neighbor Provision propels EPA down this path,” wrote Ginsberg.  She added that the proportionality approach espoused by the D.C. Circuit is simply not practicable when multiple upwind states contribute to the pollution of multiple downwind states.  “Neither the DC Circuit nor the respondents face up to this problem,” adds Ginsberg. 

Cost effectiveness

Third, the Supreme Court majority upheld the EPA’s approach to using cost as a basis for reducing upwind pollution. 

“Eliminating those amounts [of air pollution] that can cost-effectively be reduced is an efficient and equitable solution to the allocation problem the Good Neighbor Provision requires the Agency to address,” wrote Ginsberg.  “Efficient because EPA can achieve the levels of attainment, i.e., of emission reductions, the proportional approach aims to achieve, but at a much lower overall cost. Equitable because, by imposing uniform cost thresholds on regulated States, EPA’s rule subjects to stricter regulation those States that have done relatively less in the past to control their pollution.”

Dissent

In the dissenting opinion, Justice Scalia, joined by Justice Thomas, disagreed that the proportional approach rejected by the majority is unreasonably difficult.  “I fully acknowledge that the proportional-reduction approach will demand some complicated computations where one upwind state is linked to multiple downwind States and vice versa,” wrote Scalia.  “I am confident, however, that EPA’s skilled number-crunchers can adhere to the statute’s quantitative (rather than efficiency) mandate by crafting quantitative solutions.”

EPA v. EME Homer