Supreme Court Mercury Decision Not a Real Game Changer

In a 5-4 decision, the Supreme Court of the United States sent the Environmental Protection Agency’s (EPA) Mercury Air Toxics Standard (MATS) rule back to a lower court for review. Justice Scalia wrote the majority opinion, which hinged on an interpretation of administrative law requirements and did not overturn EPA’s ability to regulate hazardous air pollutants from power plants.

Ultimately, this decision is not a game changer. Utilities have already made the needed investments to comply with the rule and will likely continue plans to retire coal units or switch to more cleaner generation resources.

The MATS rule, which limits emissions of highly toxic air pollutants like mercury, arsenic, acid gases, and lead from coal- and oil-fired power plants, will save 11,000 lives and prevent 5,000 heart attacks and 130,000 asthma attacks per year. The rule is particularly important for the Southeast, which is home to some of the largest concentrations of coal-fired power plants – our country’s largest source of toxic air pollution.

In April 2014, the U.S. Court of Appeals for the D.C. Circuit ruled in EPA’s favor on the MATS rule, holding that the agency was not required to take costs into account when promulgating rules that are “appropriate and necessary” to address hazards to public health. That ruling was appealed to the Supreme Court by industry challengers. Although EPA felt confident it would receive another decision in their favor, ultimately the Supreme Court sent the case back to the lower court so that EPA can address this administrative law issue.

The record before the Supreme Court clearly demonstrated that EPA compared the benefits to the country’s public health against the costs to industry (in the form of investments to update insufficient air pollution controls) when deciding the stringency of the emissions limits. Under principles of administrative law, however, the Supreme Court held that EPA should have made a similar cost evaluation when deciding whether to regulate at all. While the lower court is reviewing the case per the Supreme Court’s decision, the MATS rule will remain in effect until the lower court reaches a decision.

The irony in all of this is that industry has already made the majority of the upgrades needed to comply with the emission limitations contained within the MATS rule – and at a much lower cost than predicted! A majority of utilities have already made the decision whether to invest in pollution upgrades or retire coal units and replace them with alternative generation options. For example, the Tennessee Valley Authority has already stated that the Supreme Court decision will not affect TVA’s plans to reduce its coal fleet and diversify its generation portfolio.

“Despite the breathing room afforded to TVA and other producers of electricity thanks to the 5-4 ruling, TVA’s strategy to diversify away from coal and toward nuclear and renewable sources of energy is still a sound plan that will future-proof the agency’s fleet of power plants.” Jim Hopson, TVA spokesperson.

The ever-decreasing costs of renewable energy resources, like wind and solar, and the current low price of natural gas, will likely result in a continuation of these utilities’ plans to retire coal units. The ultimate fate of the MATS rule remains to be seen. Given that the Supreme Court’s decision hinges on a narrow and fixable administrative law issue, however, we are hopeful that this important public health safeguard will be implemented and become an important tool in cleaning up the air in the Southeast.

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