By: Evan Callahan
Administrative law governs the creation and operation of administrative agencies within the government: the powers granted to administrative agencies, the substantive rules that such agencies make, and the legal relationships between agencies, other government bodies, and the public.[i] Federal agencies are delegated powers by Congress and are responsible for carrying out congressional prerogatives.[ii] Agencies are created through their own organic statues, which establish new laws, and in doing so, create the individual agencies to interpret, administer, and enforce those laws.[iii] The Environmental Protection Agency (“EPA”) is one such powerful agency under the federal administrative umbrella.[iv]
On June 30, 2022, the Supreme Court issued its ruling in West Virginia v. EPA, which concerned the EPA’s authority under the Clean Power Plan—a regulation promulgated in 2015 to limit carbon dioxide emissions of existing coal and gas-fired power plants.[v] In a 6-3 decision, the Court held that Congress did not grant the EPA the authority to decarbonize the electricity-generating industry through a “generation shifting” approach[vi] which would effectively replace coal-fired power plants with plants fueled by natural gas and replace fossil fuel-based electricity with renewable energy sources, including solar installations and wind farms.[vii] Specifically, the Court concluded that § 111(d) of the Clean Air Act did not authorize the EPA to devise emissions caps based on the generation shifting approach.[viii]
According to the Clean Power Plan, § 111(d) grants the EPA broad authority to decarbonize the nation’s power industry and to also determine the specifics of implementing such a policy—a determination which is typically left to the states under the statute.[ix] Not finding enough basis for the EPA’s “newly discovered” authority in the text of the Clean Air Act, the Court rejected the EPA’s interpretation and concluded that Congress could not reasonably have been understood to have granted the EPA such significant and far-reaching power.[x] Justice Gorsuch’s concurrence explained that this was not a ruling regarding whether the policy should have been pursued.[xi] Instead, the issue revolved around the EPA “seeking to resolve for itself the sort of question normally reserved for Congress.”[xii] As a result, the Court, going forward, will look for “clear evidence” to show that Congress actually afforded the agency the power it claims.[xiii] The agency, he said, relied on a “rarely invoked statutory provision that was passed with little debate and has been characterized as an ‘obscure, never-used section of the law.’”[xiv]
With the compelling facts of West Virginia, it is easy to miss sight of arguably the most important repercussion of the case. The Chevron doctrine is a concept central to administrative law cases since Chevron. v. NRDC was decided in 1984.[xv] Under “Chevron deference,” the courts will regularly defer to agency interpretations of such statutes unless they are unreasonable.[xvi] When a court reviews an agency’s construction of the statute which it administers, it is confronted with two questions.[xvii] First is the question of whether Congress has directly spoken to the precise question at issue.[xviii] If the intent of Congress is clear, that is the end of the matter; the court and the agency must give effect to the unambiguous intent of Congress.[xix] If, however, the court determines Congress has not directly addressed the precise question at issue, the court does not simply impose its own construction on the statute, as would be necessary in the absence of an administrative interpretation.[xx] Rather, if the statute is silent or ambiguous regarding the specific issue, the question for the court is whether the agency’s answer is based on a permissible construction of the statute.[xxi] If so, then the agency action is permissible.[xxii] The majority opinion in West Virginia, however, flatly ignored Chevron.
Some would view this development as the end of the Chevron doctrine as we know it, a massive blow to regulatory agencies’ power at a time when more aggressive policy action allowed by deference from the courts is particularly needed to curb the dangers of climate change. While this is of course a lingering concern, a more accurate takeaway from West Virginia may be that Chevron remains, though weakened, but was never meant to deal with such a major regulation as this case presented.
West Virginia was categorized by the Court as a major questions case.[xxiii] The major questions doctrine stands for the principle that the Supreme Court will reject agency claims of regulatory authority when (1) the underlying claim of authority concerns an issue of “vast ‘economic and political significance,’” and (2) Congress has not clearly empowered the agency with authority over the issue.[xxiv] The Court traditionally has treated this as an exception to the Chevron doctrine.[xxv] Therefore, on the other end, some experts in the field are unsurprised that Chevron was not employed to resolve major questions that it was not designed to address, and West Virginia ultimately did little to nothing to undermine Chevron.[xxvi]
Both sides have merit and, likely, we all wish that the Court would be clearer in setting the current parameters of administrative law. Regardless, the EPA was dealt a huge blow in its continuing effort to curb the dangers of under-regulated carbon dioxide emissions, both on the merits and going forward considering the Court’s neglect of Chevron. And their effort was embodied by a comprehensive and ambitious natural resources policy which many would complain agencies should pursue more often. The guidelines, though at times more confusing than helpful, show some clarity post-West Virginia: if the EPA wants to pursue such a strong green energy policy, Congress needs to clearly empower the agency to through new legislation. More feasibly, the EPA should pursue more incremental energy shifting policies under § 111(d) since the Court limited its ruling to rejecting the generation shifting approach under the provision.[xxvii]
[i] administrative law, Cornell Legal Info. Inst., https://www.law.cornell.edu/wex/administrative_law (last updated June 2022) [https://perma.cc/3AXM-2TNR].
[ii] Id.
[iii] Id.
[iv] Id.
[v] Casey Norman, West Virginia v. EPA – Mouseholes and Major Questions, New C.L. All. (July 11, 2022) https://nclalegal.org/2022/07/west-virginia-v-epa-mouseholes-and-major-questions/ [https://perma.cc/DEQ8-PLFA].
[vi] Id.
[vii] Id.
[viii] Taryn Zucker et al., West Virginia v. EPA Casts a Shadow Over SEC’s Proposed Climate-Related Disclosure Rule, Harvard L. Sch. F. on Corp. Governance (Aug. 3, 2022) https://corpgov.law.harvard.edu/2022/08/03/west-virginia-v-epa-casts-a-shadow-over-secs-proposed-climate-related-disclosure-rule/ [https://perma.cc/Z5ZF-43S5].
[ix] Norman, supra note v.
[x] Id.
[xi] West Virginia v. EPA, 142 S. Ct. at 2622 (2022) (Gorsuch, J., concurring).
[xii] Id.
[xiii] See id.
[xiv] Id.
[xv] See Chevron deference, Cornell Legal Info. Inst., https://www.law.cornell.edu/wex/chevron_deference (last updated June 2022) [https://perma.cc/D2QR-EDXK].
[xvi] Cornell Legal Info. Inst., supra note i.
[xvii] Chevron, U.S.A., Inc. v. NRDC, Inc., 467 U.S. 837, 842 (1984).
[xviii] Id.
[xix] Id. at 842-43.
[xx] Id. at 843.
[xxi] Id.
[xxii] Id. at 866.
[xxiii] West Virginia, 142 S. Ct. at 2610 (2022).
[xxiv] See Util. Air Regul. Grp. v. EPA, 573 U.S. 302, 324 (2014).
[xxv] Daniel J. Sheffner, The Major Questions Doctrine, Cong. Rsch. Serv. (Apr. 6, 2022) https://crsreports.congress.gov/product/pdf/IF/IF12077 [https://perma.cc/F6WD-ZYHC].
[xxvi] See Dan Wolff & Eryn Howington, Justices’ EPA Ruling Didn’t Move Needle On Chevron Doctrine, Law360 (Aug. 9, 2022, 2:56 PM) https://www.law360.com/articles/1519300/justices-epa-ruling-didn-t-move-needle-on-chevron-doctrine [https://perma.cc/43CY-2EDT].
[xxvii] See West Virginia, 142 S. Ct. at 2615-16.