Volts podcast: Jay Duffy on the Supreme Court's EPA decision

In this episode, lawyer Jay Duffy, who represented environmental
groups in West Virginia v. Environmental Protection Agency,
explains the ins and outs and potential implications of the
Supreme Court’s final ruling in the case.


(PDF
transcript)


(Active
transcript)


Text transcript:


David Roberts


On June 30th, the Supreme Court handed down a ruling in the case
of West Virginia v. Environmental Protection Agency. There was a
great deal of dread in the climate community in advance of the
ruling, and a great deal of hyperbolic coverage in its wake. But
what did it actually say?


Volts listeners will already be familiar with the case thanks to
a pod I did on it a few months ago with Jack Lienke and Kirti
Datla, and they will recall that it was somewhat bizarre for the
court to take this case at all, since it regards a set of
regulations that never were and never will be put into effect.
Rather, the court seemed eager to pass judgment on the legal
justification that it anticipates EPA might use when regulating
greenhouse gases under Biden. It was, in other words, an advisory
opinion, which the Supreme Court is not supposed to do.


Nonetheless, it took the case and now it has ruled. The headline
is that the majority opinion is not as bad as many anticipated,
especially in the wake of the unhinged Dobbs decision that
overturned Roe v. Wade. This was a Chief Justice Roberts special,
carefully parsed and hedged.


To get clear on what the ruling does and doesn't actually say, I
contacted one of the lawyers on the case, Jay Duffy of the Clean
Air Task Force. Duffy was responsible for several of the key
briefs and arguments in the case, so I thought he would have a
good read, not only on what the Roberts decision says, but what
it portends for subsequent cases.


So, without further ado, Jay Duffy, welcome to Volts. Thanks for
coming.


Jay Duffy


Thanks so much, David. It's a pleasure to be here. Thank you for
asking me to come on.


David Roberts


Let's start just really briefly, tell us about your involvement
in the case.


Jay Duffy


Sure. So I represent a number of environmental and public health
groups. American Lung Association, American Public Health
Association, Appalachian Mountain Club, Cleaner Council, Clean
Wisconsin, Conservative ... "Conservative no", Conservation Law
Foundation, and Minnesota Center for Environmental Advocacy. We
challenged the ACE rule in the CPP repeal when it came out in the
DC Circuit. I argued a portion of that oral argument on a nine
hour zoom call. Yeah, I hope this pod won't be as painful as that
was. We won below, and then that was, of course, appealed by
State Attorney General and coal interest, and I continued to
represent the same clients before the Supreme Court.


David Roberts


So at a headline level, everybody saw the Dobbs ruling, which was
a Sam Alito special, i.e. completely unbound, and unrestrained,
and deranged, and I think were subsequently filled with fear
about this ruling. But this is a Roberts decision, not an Alito
decision. And it seems to bear the sort of typical
characteristics of a Roberts decision, in that it is sort of a
little bit of this, a little bit of that, kind of trying to cut
it down the middle, not quite dramatic, slightly more technical,
slightly more narrow. So am I right in thinking that in the
spectrum of outcomes that climate people anticipated or imagined,
this is toward the better side?


Right. This is one of the better outcomes we could have
envisioned. Is that roughly right?


Jay Duffy


That's roughly right. I think there are two kind of lanes in this
decision. There is what is the path forward for regulating
greenhouse gases from power plants? And I think there is still a
lane there. And we were concerned that we would have a roadblock
on the major questions, doctrine expansion, that piece is more
troubling and I think we could probably get into that. But I do
think, even though the Roberts opinion kind of throws shade on
multiple pathways forward, at the end, he says, "this is just a
narrow opinion. All we're saying is that the Clean Power Plan and
the system underlying the Clean Power Plan is outside of EPA's
authority."


David Roberts


Right? So they didn't nuke Mass vs. EPA. They didn't take away
EPA's ability to address CO2. They didn't try to mess with the
endangerment finding whereby EPA found that CO2 is a danger.
There's a lot of bigger things they could have done that they
didn't do. And we'll get into later sort of where we think
they're going from here. Let's talk about then what Roberts did
say. And when I first was reading about this, I thought that
Roberts was focusing on the sort of inside the fence-line versus
outside the fence-line question, which for listeners who don't
have the background on this, the question is, if you're
regulating coal plants, do you have to confine your regulations
to the coal plant itself?


Or in some sense, can you regulate the fleet, or can you do what
the Clean Power Plan did, which is regulate the entire
electricity fleet, not just coal plants? But that's not quite
right. He specifically didn't speak on the inside versus outside
the fence-line question. It sounds like all he did is just say
whatever regulations you pass on coal plants, they cannot require
utilities to shift generation to non-coal plants, i.e. generation
shifting. Is that all he said? Is that it?


Jay Duffy


Well, and he also didn't say that ... The interesting thing about
this section 111 of the Clean Air Act, which is what we're under
right now, is EPA doesn't actually require any sort of pollution
control. What it does is come up with, okay, what's the best
system of pollution control out there? Comes up with a standard,
and then it's up to the states to then set standards for their
individual power plants that they comply with in any way they see
fit.


David Roberts


Right.


Jay Duffy


So in this ruling, it does seem like even complying with
generation shifting is still on the table, you could have a rule
based on cofiring, or CCS, or some other quote unquote inside the
fence-line measure. It seems like the pathway forward could still
be an individual plant deciding to shift generation.


David Roberts


Right. So I think, as I understand it, what he said was when EPA
is contemplating output standards for coal plants, it cannot take
generation shifting into account when setting the standard.


Jay Duffy


Right, that's exactly right.


David Roberts


It has to set the standard based on inside the fence-line options
like cofiring, like CCS, things like that. But in complying with
that standard, the state can still use generation shifting.
That's right?


Jay Duffy


I think so. I mean, there is a lot of ambiguity in this opinion.
I think we'll be parsing through it for a while. I mean, as I
said at the end, Roberts kind of says, "hey, even though I just
said a lot of stuff negative about cap-and-trade, and I've said
some other things about fuel switching, et cetera, I'm not ruling
on that. This opinion doesn't rule on that. All this opinion is
saying, the Clean Power Plan, don't do that again." I think we're
going to have to read the tea leaves and find out which pollution
controls have been cast more doubt upon in order to think about
what the future of these regulations will look like.


So yeah, it's a mixed bag and what is still on the table is a
little unclear. I think the inside the fence approaches are
definitely still on the table. Whether or not market mechanisms
like trading or other things like that are still on the table,
I'm not as clear. As part of basing the standard on those. Could
you do a CCS based standard, carbon capture and sequestration
based standard in conjunction with trading and set the BSDR and
the standard on that? That's unclear in this opinion, to me.


David Roberts


Right, but if you could do it, it would have to be trading among
coal plants, right? It would have to be trading among the
regulated plants.


Jay Duffy


Yes. I think thats ...


David Roberts


Seems like he's trying to sort of cut non-coal plants out of the
picture entirely.


Jay Duffy


I think that's exactly right. I think that cannot be the basis of
the standard. Shutting down the plant can't be the basis of the
standard. We certainly know those are off the table and frankly,
we've known that since they stayed the rule in 2016.


David Roberts


Yeah. So I guess if we're just confining ourselves to this ruling
and not trying to sort of contemplate what might come next or
what else they might do, it seems to me that the sort of sole
implication of this ruling is that standards for coal plant
emissions are going to have to be less stringent than they
otherwise could have been. That seems, because before you're
setting the standard based on this broad set of possibilities,
and now he sort of narrowed the set of possibilities, and so a
standard based on that narrowed set of possibilities is probably
going to be less stringent. Is that fair?


Jay Duffy


I think we could reach the same sorts of stringencies as the
Clean Power Plan. You and Jack and Kirti talked about this a lot
too, is that the Clean Power Plan was met eleven years in
advance. So query whether that was all that stringent. The
pathways forward of cofiring with natural gas or a carbon capture
sequestration based standard, those techniques can, especially
CCS, lead to near zero emissions. So I think there's still
pollution control technologies out there that can do it, but
that's yet to be seen.


David Roberts


And so to use those as the basis for your standards, say, if the
EPA says we're going to set output standards for coal plants
based on CCS, EPA has to demonstrate that CCS is what available?
And does it have to show anything about the cost? Like, what does
it have to demonstrate to allow it to use CCS as the standard?


Jay Duffy


Sure. So all those factors are listed in the statute. And is it
adequately demonstrated? Is it cost reasonable? Does it reduce
emissions? Is it the best? Does it take into consideration energy
considerations such as reliability? So those are kind of the kind
of things that they need to think about. In 2015, when the Obama
administration promulgated the Clean Power Plan in it, they said,
"we've looked at CCS, we've looked at cofiring, and they meet all
the criteria of Section 111, but they're more costly than
generation shifting. And we think even if we set a standard based
on CCS or cofiring, that the bulk of the compliance would come
from generation shifting. So we're just going to go with that."


So to me, with that taken off, with generation shifting taken off
the table, the record is already there for a kind of CCS/cofiring
based standard. And right now, if anyone wants to build a new
coal plant, that is the standard. Right now, it's based on
partial CCS


David Roberts


Right. For new plants?


Jay Duffy


That's right.


David Roberts


Am I wrong in thinking that the sort of net effect of this might
be the coal industry just punching itself in the face because a
standard that requires them to use CCS is going to be, it seems
to me, way more destructive of the coal fleet than the
alternatives.


Jay Duffy


I would say it w iill be more costly than generation shifting
was, but still within the parameters of cost reasonableness under
the Clean Air Act, with a forward looking, kind of technology
forcing statute. And we have things like sulfur scrubbers in the
70s, which EPA promulgated rules in order to deal with acid rain.
When the standard was imposed, there were only three in
operation, these sulphur scrubbers, and there's only one vendor.
By the end of the 70s, there were 16 vendors, and the cost of
those scrubbers had been cut in half in 20 years. So I think the
forward looking nature of the Clean Air Act provides a good
pathway to cost declines.


You know, that's not to say that the you know, obviously EPA has
already found that CCS is cost-reasonable when it did so in 2014
and 2015.


David Roberts


Well, and surely in the subsequent seven years it has come down
in cost.


Jay Duffy


The cost has come down, and also the climate crisis has gotten
worse. So the necessity to reduce these emissions is even higher.


David Roberts


Let's get back to what EPA should do next here in a little bit.
First I want to talk about the ruling a little bit more. So let's
talk about then major questions. Doctrine. The doctrine, as I
understand it, is just, "if Congress intends agencies to do major
things, it will specify so in law and statute. And we don't want
agencies sort of interpreting vague statutes such that they are
given major powers." Right? I mean, that's sort of the idea. And
I think the idea in this case is the ability to regulate CO2 in
the US economy is a major thing.


So it is impermissible for EPA to sort of ring that out of the
Clean Air Act because the Clean Air Act does not specifically say
that. Is that more or less Robert's reasoning here?


Jay Duffy


Well, would you mind if I read you something before I hop into
his reasoning?


David Roberts


Please.


Jay Duffy


Okay. "The Court's alarm over global warming may or may not be
justified, but it ought not distort the outcome of this
litigation. This is a straightforward administrative law case in
which Congress has passed a malleable statute giving broad
discretion not to us, but to the Executive Agency. No matter how
important the underlying policy issue at stake, this court has no
business substituting its own desired outcome for the reason
judgment of the responsible agency." Who wrote that?


David Roberts


Was that Scalia in Chevron?


Jay Duffy


That's Scalia in Massachusetts versus EPA, along with his friends
Chief Justice Roberts, Justice Thomas, and Justice Alito.


David Roberts


Hilarious.


Jay Duffy


I've been reading it over and over again.


David Roberts


This is Chevron, right? This is what's known as Chevron, which is
the idea, which has been practice, as far as I know, for quite a
while in the Court, which is just giving agencies sort of broad
ability to interpret statutes as they see fit and more or less
trying to keep judges out of it. This has been standard practice
for a long time, right?


Jay Duffy


That's right. I mean, this is how Congress works, right? There's
not a bunch of scientists and engineers, et cetera, over in
Congress trying to figure out what the best pollution controls
are and how a power plant works. So what Congress does is they
want these laws to last for a long time. They want them to be
able to adapt to new problems and new solutions. And so they
write these kind of broadly worded statutes like, "Find the best
System of Emission Reduction."


David Roberts


And the Clean Air Act and the Clean Water Act are sort of
legendarily designed to be flexible designed to incorporate new
information and change and grow over time. That's partially why
conservatives hate them so much,


Jay Duffy


right? That's exactly right. There are plenty of guardrails here.
There are a lot of factors that Congress confined EPA with in
order to find the best system of emission reduction. But up until
this point, the "major questions doctrine" to me and to the
dissent and what we argued in our briefing was Congress delegated
this authority to this agency. And it's okay that it's broad
words, but is it acting within its lane, its expertise? And is
there anything in the statute or in any other law that kind of
really conflicts is a mismatch between what they're trying to do
and something else is pushing back on it.


The interesting shift that happened here is the "major questions
doctrine" used to be defined under this utility air case as,
"Congress should speak clearly if it wishes to assign an agency
decision of vast economic and political significance." And now
there is a subtle shift here that does a lot of work in the West
Virginia case. And it says to overcome the skepticism of this is
a major rule the government has to point to clear congressional
authorization to regulate in this manner.


So it went from, "do you have the right to make the decision? Is
this your decision to make?" To, "what decision did you make?
What is the how? how you made the decision?" That actual rule
needs to be kind of pre-authorized. And to me that subtle shift
does a lot of work.


David Roberts


Yeah. And it just seems completely counter to the spirit of the
Clean Air Act because the whole point of the Clean Air Act is
lawmakers in the 60s and 70s saying, "we don't know everything
that's in the air that hurts people. So we're just going to say
whatever that turns out to be, EPA should regulate it, right.
Like whatever science discovers is in the air hurting us, EPA
should regulate it." So sort of by definition, it can't specify
in that law how EPA should regulate new threats. It doesn't know
what the new threats are. That's the whole point.


Jay Duffy


Right. This section and a lot of these sections apply to a
variety of different sources, a variety of different pollutants.
So if you regulate X pollutant from a cement plant, can we not
figure out what the best system of emission reduction is? We have
to go knock on Congress's door and say, "is this too big? Is this
a good approach here?" That's not how this is designed. It would
really gum up the works.


David Roberts


Yes, it would gum up the works. And I'm sort of obsessive about
this, but it just seems like "major questions doctrine" as it's
being interpreted on its face, counter to the literal spirit of a
bunch of laws that Congress passed. It seems like in and of
itself, it's thwarting Congress's intent under the guise of doing
the opposite.


Jay Duffy


Right? That's right. I think Nathan Richardson wrote an article
recently called "Anti-Deference".


David Roberts


Right.


Jay Duffy


It's not even just Chevron. It's now you've got a thumb on the
scale against doing something important, and it's anti-regulatory
in nature. As you spoke about with Kirti and Jack, there isn't an
issue brought up, there aren't any court rulings out there that
say, "oh, you're not doing something important." That's a major
question. And you could see that throughout, looking at the
factual background as they laid it out, was a lot of focus on the
cost to the industry without any description of the benefits to
society.


David Roberts


Yes, this is a sort of theme lately. They wrote a gun ruling that
had virtually nothing in it about the victims of gun violence.
They wrote an abortion ruling that had virtually nothing in it
about the impact on women. And now they've written a pollution
ruling that says almost nothing about the effects of pollution.


Jay Duffy


Yeah. The humans who breathe.


On humans.


Yeah.


David Roberts


It's striking. And so why ... that quote you read was the pretty
standard Chevron reading of agency discretion, why do you think
Roberts has shifted? Is it just as simple as because he can and
has a giant majority now?


Jay Duffy


We can kind of see this thread from Roberts over the course of
the past decade or so. He, in a dissent to this case called City
of Arlington, said that deferring to agency's broad
interpretation of laws isn't quite the very definition of
tyranny, but the danger posed by ... don't worry, it's not the
very definition, but the ...


David Roberts


Tyranny adjacent.


Jay Duffy


Exactly. But the danger posed by the growing power of the
administrative state cannot be dismissed.


David Roberts


I mean, yes, it can. I can dismiss it. Watch me. I just did.


Jay Duffy


So at the time in that dissent, justice Scalia actually responded
to that dissent and said, you can characterize anything as a
major question. You can characterize anything as over
jurisdiction.


David Roberts


Indeed. Based on vibes.


Jay Duffy


Exactly. Vibes only, a nod to our friends at the other pod. But
he explained that everything could be characterized as a question
about agency and authority, and that sort of rule would be an
inappropriate transfer of interpretive power from the agencies to
the court. I think that's kind of the path we've been on. The
interesting kind of detour that Roberts took was in the
Affordable Care Act case, he essentially said there, this is a
major question. "The treasury shouldn't be making health care
decisions. But I'm not going to say that the rule is illegal. I
just am going to say that it's the court's decision to make."


And there he upheld the quote, unquote, major rule. So we've kind
of seen a shift just since the Affordable Care Act, and I was
hopeful for a more narrower approach to the "major questions
doctrine" than what we saw here, knowing that the Roberts opinion
in King versus Burwell did actually end up upholding the major
rule. It just didn't grant deference to the agency.


David Roberts


And now he is thwarting the agency directly. Let's talk about
then. Maybe there's no answer to this, but what in the hell is a
"major question"? What are the characteristics, what are the sort
of metrics or standards by which an agency contemplating a rule
sitting around, I'm just picturing them sitting around a
conference table contemplating a rule, thinking, "well, but is
this major?" How do they know what standards or metrics have been
offered by Roberts for other people to judge whether something is
major? Or is it literally just feels major to John Roberts?


Jay Duffy


He literally said, in the opinion, "does it raise an eyebrow?
Does it raise an eyebrow?"


David Roberts


Whose eyebrow? John? Who's eyebrow?


Jay Duffy


And how high does your eyebrow have to go?


David Roberts


I know, raise it a millimeter. 2 millimeter.


Jay Duffy


That's the most striking. There are some parameters or factors,
although even in Gorsuch's concurrence, he said, this is not an
exhaustive list. Come with us. Come to us with further
suggestions as to what might make something major.


David Roberts


Oh, God.


Jay Duffy


But is it old? Which strikes me saying, as the Constitution is
235 years old, has it not been used a lot? They just kind of use
it or lose it idea. Is it an ancillary provision? I saw someone
on Twitter earlier today say I love all of my Clean Air Act
provisions equally, there are no ancillary provisions. They were
all written by Congress, a sort of anti-novelty principle, which
I think Jack made a great point on your last pod about, so once a
law is enacted, if the agency doesn't go and do something big at
the outset, they kind of get locked into what it is, even though
here we're dealing with a portion of the statute that deals with
an entirely different pollutant and a different source category.


So of course, the solution is different.


David Roberts


Not to pound the table on this, but the whole freaking point of
the Clean Air Act is to say we don't know all the pollutants yet.
There might be new pollutants. Let's do scientific reviews every
few years and see if there are new pollutants. So by definition,
if you find a new pollutant that's novel, it it's going to be the
first time like this. These are all Catch-22s.


Jay Duffy


That's right. And I also think that the interesting thing here is
that, it kind of goes back to that Scalia quote, that you can
characterize anything as major. And I would characterize the
Clean Power Plan as the most cost effective, efficient means of
reducing emissions from the power sector based on decades of them
doing exactly that, and then they continue to do it such that
they reduce their emissions beyond the targets of the Clean Power
Plan. But if you read the opinion, that is not what you come away
with. You come away with this idea that there was an EPA takeover
of the entire electric grid.


And so that's what's troubling to me is that you can use these
kind of squishy factors and characterize things however you see
fit, to kind of fit the factors almost


David Roberts


Well this is one of the great ironies, and this is one of the
things that makes me laugh about this whole judgment, is the
particular provisions being characterized as major here, in this
judgment. The targets were met without the regulations ever
passing, meaning almost by definition, if they had passed, the
targets would have been met at zero cost, since they were going
to be met anyway. So if a regulation that would have had almost
literally no effect on anyone at all, if that counts as major,
what wouldn't count as major? Literally? We know how major this
would have been.


We can now see in historical retrospect how major it would have
been. It would have been tiny. It would have been completely
marginal. It would have done almost nothing.


Jay Duffy


Well, there is some interesting back and forth with Justice Alito
at the oral argument where he was arguing, "that it's not about
what's happening in this actual rule, it's about what could it,
what is the most you could do with this new interpretation?
That's the stick by which we should be looking at." Yeah, and I
don't know how much that played into the thinking here, but
you're right. I mean, there was no rule at issue. Justice Roberts
essentially admitted that this was an advisory opinion upfront.
So the standing here was based on this idea of voluntary
secession exemption to mootness, which essentially says, "you EPA
have told us that you're not going to bring the CPP back into
effect, but you could, couldn't you?"


And then they could look at the record and said, "no, the state
plans were due to the agency in 2018. The targets have already
been met." And so then they move on and fairly explicitly say
that EPA needed to somehow demonstrate unequivocal abandonment of
generation shifting, henceforth.


David Roberts


But how could it demonstrate that? What does it even mean?


Jay Duffy


Right, well, it's by definition, the concept of generation
shifting is not what was before the Court. The Clean Power Plan
repeal, not even the Clean Power Plan was what was before the
Court.


David Roberts


Yeah, this is the most sort of tortured, obvious effort to insert
itself in agency deliberations and just like scrabbling together
the most thin justifications for it. It's really striking the
deeper you get into it. So I wanted to ask briefly about
concurrences. As I said, this seems like a very Roberts-esque
ruling as opposed to an Alito-esque ruling. So were the other
conservatives on the Court, did they have, as they want to do,
crazier things to say in their concurrences?


Jay Duffy


As someone who will be litigating before this Court again in the
future, I'm sure I will not opine on anyone's craziness, however.
So we've all known for a while that Justice Gorsuch is a fan of
the non-delegation doctrine, and he provided us with a reading
list in his concurrence. Interestingly, Thomas, who has signed on
to these sort of concurrences on the non-delegation doctrine,
especially on the shadow docket cases about vaccines and eviction
moratorium, Thomas didn't sign on to this one, so I'm not quite
sure yet what to make of that.


David Roberts


Yeah, it's not like Thomas to show any restraint.


Jay Duffy


Right. Essentially, what Justice Gorsuch, he wanted to get into
what the "major question doctrine" does, and I think he sees it
as a way to vindicate his concerns about non-delegation, without
all the messiness of essentially striking down multiple laws. He
says that, "'the major question doctrine' is something that
preserves Congress's power to legislate and for the lay people to
have their say." But they did. The Clean Air Act was written, and
it was supposed to do important things, and I think it discounts
what Congress actually did. And there's a lot of public input
that goes into these.


David Roberts


Yeah, that's what I wanted to emphasize. They are trying to
characterize agency actions as anti-democratic, as though there
is this cabal of bureaucrats up there doing things with no care
for the common man. But if you look at actual American
governance, the EPA, in coming up with one of these rules,
arguably takes in a lot more public input and is more responsive
to public input than the friggin legislature is. Like, these
rulemakings are arguably one of the most democratic things
America still does.


Jay Duffy


Yeah, that's right. And they are required under the
Administrative Procedure Act to provide public comment. They
can't change the rule too much after they provide the public
notice of the rule. They need to take into account and respond to
the thousands of comments that come in. This is, as you said,
kind of more democratic than what we get to do with legislation.
So I think it undermines that significantly.


David Roberts


I mean, I'm cynical about this, but this idea of non-delegation
is basically just Congress shouldn't hand off important things to
agencies. It should do the important things itself. Again, what
counts is important. Again, why? This is the thing about
non-delegation and "major questions doctrine". It's just like,
where is this coming from? There's nothing in the Constitution.
The word major does not appear. You know what I mean? Like, all
these principles are just made up by conservative jurists. Am I
wrong about this? Is there textual or constitutional basis for
these things? Or are these just like, kind of how these guys
feel?


Like "they shouldn't be doing major stuff, It just feels wrong."
What is the basis for these doctrines?


Jay Duffy


Yeah, and I think the idea is that there's a separation of powers
concern that Congress is supposed to be making the major
decisions, and that the agencies are just supposed to be there to
fill up the details pursuant to them making the major choices.
But as we've talked about what constitutes major, and there's
plenty of scholarship out there talking about the legislature
delegating authority to agencies since the founding.


David Roberts


Yes, the dissent had quite a bit on that, I think.


Jay Duffy


That's right.


There's also a really strange and gratuitous footnote about
Woodrow Wilson in the concurrence. It was one of the stranger
things I've read in a case in a long time. Gorsuch essentially
says that, "Woodrow Wilson was a racist, which I believe is true
and didn't like laymen, and that his attitude was that we need
more experts making policy." And so the insinuation here is that
you need to pick Woodrow Wilson's side or scientists and
engineers making technical determinations about complicated
pollution controls. Pick a side with Woodrow.


David Roberts


It's a little bizarre guilt by association there.


Precisely.


"This racist liked scientists. Do you like scientists? Sounds
racist." The cynical take on non-delegation is just Congress
doesn't have the expertise or the time to get into nitty gritty
detail about specific decisions that administrative agencies
might make. So if you say that all major decisions have to be
made by Congress, in effect, you're just radically reducing
federal power, right? You're just going to get a lot less law and
regulation out of Congress because Congress just doesn't have the
capacity to do what it's being asked to do, right?


I mean, that's Gorsuch's long term goal, right? It's just to
shrink the federal government and reduce federal power. Is that
too cynical?


Jay Duffy


Elena Kagan, Justice Kagan says in her dissent that all signs
here point to just an animosity toward the administrative state.
So the system, the way it works right now is a conservative Court
can decide what is major and kick it back to a Congress who isn't
working right now in a lot of ways.


David Roberts


Yes, the very conservatives saying, oh, this is the job for
Congress are the same conservatives who have spent decades
rendering Congress completely useless, and frozen, and unable to
do anything. It's almost like they just don't want the government
to work at all.


Jay Duffy


I'll give them what one ... on our side of the briefs, we did
understand and acknowledge that the Clean Power Plan was novel.
We believed that the generation-shifting mechanism was fully
supportable, and was demonstrated, and cost effective, and the
best means of doing this, but we did in our briefing, we
understand that creating a formal role for renewables to generate
credits is novel and could be envisioned as outside of EPA's
authority.


David Roberts


It is a bit of a stretch.


Jay Duffy


It's a bit of a stretch, and we admitted that in our briefing.
And our hope was that that would create an off ramp within the
"major questions doctrine", even, to say that the EPA has
overstepped kind of in those same ways that they've overstepped
before in the case law. They're looking at, like, treasury
looking at healthcare or something like that. EPA kind of
bringing in unregulated sources formally into a program. Maybe
that was too far. And our hope was that that would lead to the
Court being able to give a nod to "major questions doctrine" and
sort of, are you staying in your lane the same sort of way as
Justice Kagan describes the "major questions doctrine" in her
dissent?


But unfortunately, they decided that they needed to go further
and kind of say, "is the rule that you came up with, is that
pre-authorized by Congress?" Not just "is this within your lane?"


David Roberts


Right. But it is narrower than it could have been. So they're
saying you can't take generation shifting into account. But I
thought it was clever of you guys to argue this. In a sense, you
gave them that as a sort of modified, limited ruling to sort of
forestall them ruling in a much broader way. So the sort of
generation-shifting thing is kind of like a sacrificial lamb that
you offered up for them to kill. So they didn't kill the whole
thing.


Jay Duffy


Well, not even the generation shifting amongst sources. The hope
was that you could then preserve even just shifting between
covered sources. What we kind of expressed was novel was
including non-Clean Air Act sources in the program.


David Roberts


So shifting amid regulated plants is still on the table.


Jay Duffy


I don't know.


David Roberts


We'll find out in future lawsuits.


Jay Duffy


Right. I don't think anyone's chomping at the bit to test that
one.


David Roberts


Right.


Jay Duffy


But he did say the way the Clean Power Plan did it exceeded EPA's
authority. And there's a lot of language in there that says that
just reducing generation at a source is not a system of emission
reduction. So I would doubt that that is within anything anyone
wants to pursue and may just be precluded by the decision.


David Roberts


Well, I want to talk about what avenues EPA should pursue, but
first, let's just talk briefly about my sense, is that what
Roberts would have preferred to do on Dobbs and on abortion is
shave away at it incrementally, bit by bit, because he kind of
scolds the majority in that case for the jolt. This is too big of
a jolt, and we're not supposed to jolt people. I want to erode
abortion rights bit by bit by bit, like I'm eroding voting rights
and money in politics. So we're easing our way into this new
reactionary future. That seems to me like what he wanted to do on
abortion and was upset that Alito didn't go along with it.


It seems like that is what he's doing on the Administrative State
question. So I'm curious about two things. One, I'm curious since
he doesn't really control the majority anymore, right? Like if
Alito, and Gorsuch, and Coney Barrett want to get together and go
big, he can't really stop them anymore. So I'm curious about two
things. One, why you think they signed on to the kind of slower,
more incremental strategy this time, and then, secondly, what you
think is next, because this is surely not the last word this
court is going to have on the Administrative State.


Jay Duffy


Right. I mean, I think on the power plant side and the paths
forward there, I think that was incremental. It's pretty narrow.
It takes off just the Clean Power Plan approach. But I do think
that the Chief is actually more aligned with the conservative,
less incremental side on the administrative state. As I said,
it's tyranny adjacent. I think this opinion actually is an
opinion that the rest of the conservatives wanted to sign on to.
It kind of creates this you don't need to get into Chevron or any
sort of deference and it's actually an anti-deference canon.


David Roberts


They never mentioned Chevron. It's quite striking.


Jay Duffy


No, and the interesting thing too is that the Trump
administration, when they repealed the Clean Power Plan, they
came in with this Chevron one claim language. Every system that
you utilize to control pollution from these plants needs to be to
or at an individual source. It was a 65 page Federal Register
notice. And, you know, half a page talks about the "major
questions doctrine" and they say our plain reading of the Clean
Air Act is that you can't, you can't use generation shifting and
everything needs to get bolt on control. And we think the "major
questions doctrine" confirms that.


They don't even get into it all that much.


David Roberts


So that's, in a sense, Roberts did not confirm that
interpretation, right? The idea that the only permissible
regulation here is something that you bolt onto a coal plant,
which was sort of the Trump EPA's take. He didn't affirm that and
sort of by implication said that's wrong, right? I mean, in some
sense this is a ruling against that interpretation as well.


Jay Duffy


I think that's right. And I actually think that would have been a
more dangerous decision for regulating power plants and for a
path forward for power plants. They kind of were narrower on
this. What does 111 say? And is it as confined and extreme as the
Trump EPA had proposed? They were a little more narrow there, but
then used the "major questions doctrine" much more than the Trump
administration did in order to do the work of knocking down the
Clean Power Plan.


David Roberts


What's next then? Are there other particularly significant cases
regarding the administrative state that are on the docket? Or do
we know sort of what the next step? I mean, I'm just assuming
that Roberts is going to be trying to sort of destroy the
administrative state in pieces. Is there any sense of what's
coming next?


Jay Duffy


Well, I work on transportation litigation as well, and we're
currently in the DC Circuit Court of Appeals litigating a
challenge over light duty vehicle standards. And we have the
statement of issues in from the red state attorneys general and
there they're saying any reliance on transitioning to zero
emitting vehicles ...


David Roberts


Of course.


Jay Duffy


Raises the specter of the "major questions doctrine".


David Roberts


Same basic thing, right? Same idea. You can't make standards
based on the idea that fleets could switch to electric right?


Jay Duffy


That's right. And the same sort of thing too, where a lot of the
automakers, they're fine with the standards that EPA is coming
out with. And as we saw in West Virginia, it was the coal
interest and the red states. It wasn't the power industry. The
power industry was actually arguing for this sort of
interpretation because they know that this is the way that the
industry has worked for years.


David Roberts


And I bet they would like to just know what the hell they're
supposed to do at this point.


Jay Duffy


I know. I mean, that's the real troubling thing going forward is
now everyone's guessing as to what's major.


David Roberts


I know this whole idea that conservatives care about regulatory
certainty is such a freaking joke. They've just inserted very
fundamental uncertainty into every agency decision now.


Jay Duffy


Right. Even thinking about the power plants, I've been on the
briefs here. I've argued portions of the case and even I can't
quite tell you what is on and off the table. And I've read the
opinion ten times already. So I don't know how exactly we figure
out on a variety of rules. There's always going to kind of be
this looming big brother of major questions.


David Roberts


Well, this again is a cynical take on it, but I feel like
cynicism is justified these days. It's almost if he had been more
specific and clearer, it just seems like Roberts left quite a bit
of vagueness in there on purpose. Because the effect of vagueness
is that the agencies will start being cautious on their own,
right. They're going to start sort of patrolling themselves,
policing themselves, being cautious themselves, rather than take
chances. So in a sense, it's almost leaving the vagueness out
there seems deliberate. It seems like a deliberate play to sort
of just signal to agencies, "hey, rein yourselves in," across the
board.


Jay Duffy


Right? I mean, I don't know can't speak to the intentions, of
course, but I know that it is going to raise that for all the
agencies trying to figure out what the lines are. It also leaves
very little guidance and a lot of breadth to lower courts who
deal with, you know, the majority of these, these sorts of
decisions. Most agency decisions, you know, go to the DC Circuit,
and now they kind of have to parse through, you know, what
exactly is major here.


David Roberts


Knowing that at any time the Supreme Court could just take
something away from them, reverse them. Like the way the Supreme
Court is treating these lower court rulings. Must be discouraging
to be a judge at that level, I would say. Let's conclude then by
talking about what EPA should do. So it cannot do what the Clean
Power Plan did, which is make output based standards for existing
power plants based on a wide array of compliance strategies,
including generation shifting. You can't do that. But Roberts
didn't specifically preclude a lot of other routes forward. I
know you're not in charge of EPA.


You're not in the administration, but sort of your sense of what
EPA is going to take from this and the likely route it's going to
try to take forward now addressing greenhouse gases from existing
power plants.


Jay Duffy


Right? I mean, I go back to the 2014 and the 2015 rulemakings
where EPA said that cofiring and CCS are available and meet all
the criteria of Section 111. To me, that seems like the natural
path forward to stringent standards. That's what I anticipate.


David Roberts


And that's just to clarify, EPA is saying, "you have to bolt this
thing onto your power plant to bring it down to meet this output
standard." You cannot get more straightforwardly legal than that,
right? I mean, there's no fuzziness about whether EPA is allowed
to do that, is there?


Jay Duffy


Well, as I said before, EPA can't tell you to do that, but they
can base standards on it, and then you can apply however you see
fit. But yes, CCS is a carbon scrubber, just like other scrubbers
that are bolted onto plants. Cofiring with CCS is at the source
just like other things that have been used for decades. I am
certain that even in the ... there's currently a case over that
2014 new source performance standards for coal plants, that's
based on CCS, that has been stayed for years and years now
because the Trump administration said it was going to repeal it,
and then it ended up not repealing it.


And now this EPA is reviewing it. So there are challenges there
essentially saying CCS is not adequately demonstrated, and it's
too costly. So I'm sure we'll have those arguments, but those are
more the sort of like record based, "let's go through a bunch of
engineering diagrams and modeling and cost metrics," which is not
usually, and I say that with a long pause, the thing that the
Supreme Court spends their time on.


David Roberts


So you think probably that question will be resolved by the DC
Circuit Court and the Supreme Court will not mess with it. Is
that your guess?


Jay Duffy


That is my guess. Based on historically, the types of cases that
the Supreme Court takes up because that they don't waste their
time kind of like parsing through an administrative record on
sort of engineering details.


David Roberts


Yeah, I'm just trying to exercise my tragic imagination more
these days and imagine what they could do if they woke up grumpy
one day. So am I right in saying the reason EPA didn't do that in
the first place was because it wanted to make a system that was
more flexible, and adaptable, and lower cost? So am I right in
saying that by eliminating these novel possibilities of treating
the whole electric fleet as one system and requiring you to, more
or less, make your standards based on what you can bolt on the
coal plant, you're going to end up with a system that is tougher
on coal plants, are you not? I mean, this really seems like the
coal industry shooting itself in the foot, like you're going to
end up with standards that are more difficult to meet and are
probably going to lead to more coal plants closing.


Is that wrong?


Jay Duffy


I don't think that's wrong. I think there is a path forward to do
it. I think there's a bunch of compliance alternatives, as I said
before, with the sulfur scrubbers. I think once a regulation is
put into place, it is remarkable how quickly industry can
innovate, and learn, and decline costs, and things of that
nature. So it could be something that spurs some real action
based on the technology forcing nature of the Clean Air Act and
what it requires, which is putting on the best system. And those
are the best systems right now.


David Roberts


Yeah, we're all, I guess, just speculating at this point, but so
many of these coal plants are just kind of lumbering, half-dead
giants anyway because as you say, compliance wise, utilities can
comply by shifting generation if they don't want to plow a bunch
of money into a half-dead coal plant. So I just sort of
anticipate, if the choice comes down, bolt CCS onto this already
not particularly competitive coal plant, or just let it die. I'm
guessing let it die is going to be the more common route, but
we'll see about that. So what's the schedule then?


Now EPA is in the midst presumably of analyzing this, because
they weren't going to use the CPP anyway. So I guess by way of
wrapping up, I'm sort of curious like where EPA is on this. Are
they starting over now with a new rulemaking or do you think
they've got a lot of work done? Sort of like when do you think we
can anticipate a new rule out of EPA?


Jay Duffy


So EPA has said in it they do a unified regulatory agenda in the
spring, and they said that there will be proposals on new and
existing power plants for their carbon emissions in March 2023.
They have been working, they have been thinking — at Clean Air
Task Force, we go in and have meetings with EPA and provide them
with our analysis. And we have a whole bunch of engineers, and
scientists, and policy folks who do modeling and all sorts of
analysis that we go in and provide to EPA to help them form their
rules. And we've done that.


So we know that they've been taking meetings with us and and
others to work on on this new set of rules, and my God, the the
record for for what you can do on on these fleets. You know,
we've been giving them materials since 2012, you know, we've
written written the same sort of comments over and over again for
a decade now. So they certainly have a lot of information to
build on and we're urging them to move as swiftly as possible.


David Roberts


Yeah, just trying to imagine what happens if these rules slip in
under the deadline, and then Trump administration comes in and
then whoosh, the whole thing. Like, if they pass rules on new
power plants and existing power plants, and there are lawsuits,
as there will be, and those lawsuits are resolved in the lower
courts in EPA's favor, would that mean that a Trump EPA is stuck
with these rules, like legally? Or can they just throw them out
all over again and start this whole damn thing over again?


Jay Duffy


They certainly could.


David Roberts


They would have to have a legal rationale for doing so, though,
right?


Jay Duffy


Yeah. An agency can change its mind. It depends also on what the
DC Circuit ruled. If they said that heat rate improvements alone
are insufficient, then that's the law of the land on 111, and
they wouldn't be able to do something like that, or even
something along those lines. There can be holdings that will bind
future administrations, but if it's EPA just using their broad
authority to come up with what that agency at that time thinks
it's the best system, then in the future, another administration
could find that a different system is the best system. It is a
bit of a whirlwind.


It is exhausting. We've been litigating what the meaning of a
system is here, for most of my career has been the word system
and what it means.


David Roberts


Oh, it never ends. Okay, well, we'll leave it there. We'll leave
it there with the modified, limited, hopeful statement that EPA,
after this ruling, still has authority over greenhouse gases,
still has authority over existing power plants, and still can and
will pass regulations forcing existing power plants to reduce
their emissions. So that's all happy and positive.


That is, although the "endangerment finding" was challenged in
the DC Circuit last week.


Surely SCOTUS is not going to take on reanalyzing the
"endangerment finding". Just tell me they're not going to do
that.


Jay Duffy


I know. I actually think that the West Virginia opinion
strengthens the "endangerment finding". It makes clear that EPA
has authority to regulate greenhouse gases from power plants. So
I think that is a very weak case.


David Roberts


Okay, well, on that extremely limited positive note, let's wrap
it up. Thanks so much for coming on at such short notice and for
clarifying all those for us. Thanks a lot, Jay.


Jay Duffy


Thank you, David. Happy Fourth.


David Roberts


You too. Bye now.


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