Will the States Thwart Obama's Coal Plan?

04/02/2015 10:20 am ET | Updated Jun 02, 2015
Alexander Koerner via Getty Images

"I've got a pen and I've got a phone," President Barack Obama famously said in January 2014. He was attempting to explain his strategy for bypassing the United States Congress, a body that hasn't been very friendly to him, not even when Democrats controlled both chambers during the first two years of his first term, much less after Republicans took control of the House of Representative and then the Senate.

Obama has used his pen-and-phone strategy to deal with issues like immigration, gun control, and health care. The approach has often led to legal battles. The latest move to end up in court concerns regulations to reduce carbon dioxide emissions, what has been billed as the centerpiece of Obama's plan to combat climate change.

During his first term, Obama promised environmental groups he would address the issue. He proposed a reduction of carbon dioxide emissions but was unable to push legislation through Congress. So, using his pen-and-phone strategy, he ordered the Environmental Protection Agency to find an existing law that could be re-interpreted to accomplish what he wanted -- without the help of Congress.

The administration ended up using the Clean Air Act, legislation signed in 1970 by Richard Nixon that actually established the EPA. (Ironically, Nixon was able to pass pro-environmental legislation in Congress even if Obama couldn't.) Traditionally, the law had been used to regulate mercury, lead and similar pollutants. But the Obama administration decided to apply it to greenhouse gases like carbon dioxide.

The loophole they found was in amendments added to the law by Congress in 1990. The House and the Senate had different interpretations of the way the law could be used to regulate industries. The House version said pollutants like mercury were covered under section 112, not 111(d), the power plant rule. The Senate version said if pollutants were not regulated in section 112, 111(d) could be used. Normally, such conflicts are resolved in committee but in this case both interpretations were included in the amendments. Since carbon dioxide was not listed as a pollutant in section 112, the Obama administration decided it could use 111(d), the power plant rule, to regulate it.

Released in June 2014 at the direction of the president, the 645-page regulatory document was called the Clean Power Plan, and it targeted coal-fired power plants. "The EPA," The Washington Post reported, "proposed a rule designed to cut carbon dioxide emissions from existing coal plants by as much as 30 percent by 2030, compared with 2005 levels... After the EPA finalizes its proposal in mid-2015, it will give states a year to design their implementation plans." The plan proposed regulations for new power plants as well, the first time the EPA handed down greenhouse gas regulations for plants that had not yet been built.

The rule is important because coal accounts for 40 percent of the nation's electricity. Any increase in the cost of production would be passed on to the consumer, which would mean higher electricity prices, perhaps much higher. In addition, the economies of some states -- West Virginia, Wyoming, Kentucky, Alabama, Pennsylvania, and others -- depend heavily on coal.

Reaction to the plan was swift. The United States Chamber of Commerce estimated the new regulations would cost business $50 billion a year, resulting in power plant closures and the loss of 224,000 jobs annually. Obama critics called the plan a war on the coal industry. Even some high-profile Obama allies attacked the plan because of the way it was created. Laurence Tribe, Obama's professor at Harvard University School of Law who taught the nation's first environmental law class, called the plan "unconstitutional."

In June, Murray Energy Corporation, the largest privately held coal-mining company in the country, which is based in Ohio, filed suit in the U.S. Court of Appeals in Washington, D.C. attempting to block implementation of the Clean Power Plan. By August, 12 states had also filed suit. The litigation, according to The Los Angeles Times, focused on "weak spots in the EPA's interpretation of an untested section of the Clean Air Act, on which the proposed rule change is based."

By March of this year, officials in nearly 30 states had spoken out, arguing the EPA did not have the legal authority to do what it's trying to do with the Clean Power Plan. The number of states joining the lawsuit reached 14. "As attorney general," Leslie Rutledge said when Arkansas joined the suit, "I will protect Arkansans against an overreaching federal government that is attempting to implement heavy-handed regulations that go beyond the scope of the law."

But the Obama administration's most outspoken critic turned out to be Laurence Tribe. Appearing before an energy subcommittee in the House in March, Tribe, now representing Peabody Energy, said that "burning the Constitution of the United States, about which I care deeply, cannot be a part of our national energy policy.... The EPA is attempting an unconstitutional trifecta: usurping the prerogatives of the states, Congress, and the federal courts -- all at once." He summed up his feelings by asking: "When you tear the Constitution apart, bit by bit, and give it a death by a thousand cuts, what else will we sacrifice the Constitution for?"

This is the question the D.C. court must ultimately answer as it considers the Clean Power Plan litigation: Just how much power does a president have?