WASHINGTON — The Supreme Court agreed Tuesday to hear a major environmental case concerning the regulation of mercury and other toxic pollutants emitted by power plants.
The basic question in the case is whether, and when, the Environmental Protection Agency must take the costs of its regulations into account. Under the agency’s interpretation of the Clean Air Act, the law’s requirement that regulations be “appropriate and necessary,” does not demand consideration of costs early in the regulatory process.
The agency’s approach was challenged by more than 20 states, along with industry groups and energy companies.
A divided three-judge panel of the US Court of Appeals for the District of Columbia Circuit ruled in April that the agency’s interpretation of the act was reasonable and thus entitled to deference.
“For EPA to focus its ‘appropriate and necessary’ determination on factors relating to public health hazards, and not industry’s objections that emission controls are costly, properly puts the horse before the cart,” Judge Judith W. Rogers wrote for the majority.
In dissent, Judge Brett M. Kavanaugh wrote that, in context, the statute required attention to costs.
“Put simply,” he wrote, “as a matter of common sense, common parlance, and common practice, determining whether it is ‘appropriate’ to regulate requires consideration of costs.”
“To be sure,” he continued, “EPA could conclude that the benefits outweigh the costs. But the problem here is that EPA did not even consider the costs. And the costs are huge, about $9.6 billion a year — that’s billion with a b — by EPA’s own calculation.”
In its petition seeking review of the appeals court’s ruling, the National Mining Association said the costs of the regulation far outweighed its benefits.
“No rational person,” the group’s brief said, “would see spending $9.6 billion for $4 million to $6 million in return as an appropriate exchange.”
In response, the agency said it took costs into account later in the regulatory process. Its brief said it considered “compliance costs when establishing the appropriate level of any power-plant regulation, but not when deciding whether to regulate those plants” at all.
The agency also disputed the mining group’s calculations.
Once fully in place in 2016, its brief said, the regulations would yield total benefits in the range of $37 billion to $90 billion.
“Those quantifiable benefits,” it said, “include the prevention of up to 11,000 premature deaths each year and the prevention of IQ loss to children whose mothers consume noncommercial freshwater fish caught by recreational anglers in modeled watersheds during pregnancy.”
The cases the Supreme Court agreed to hear are Michigan v. Environmental Protection Agency; Utility Air Regulatory Group v. Environmental Protection Agency; and National Mining Association v. Environmental Protection Agency. The court consolidated the cases for a single one-hour argument.
In its order granting review of the cases, the court sharpened and streamlined the issue it would consider: “Whether the Environmental Protection Agency unreasonably refused to consider costs in determining whether it is appropriate to regulate hazardous air pollutants emitted by electrical utilities.”
The EPA had a good year in the Supreme Court term that ended in June. But Justice Antonin Scalia, writing for the majority in June in a case on greenhouse gas regulations, said the court remained
prepared to impose limits on the agency’s regulatory authority.