On March 28, President Donald Trump issued an executive order that addresses the U.S. EPA's Clean Power Plan, or CPP, which was developed under the administration of former President Barack Obama and sought to significantly reduce CO₂ emissions from existing coal-fired power plants by 2030. The President's executive order effectively begins the process of reversing the steps that have been taken to date on the CPP, which was previously stayed by the U.S. Supreme Court and is currently under review by the U.S. Court of Appeals for the District of Columbia Circuit.

The President's executive order calls for EPA Administrator Scott Pruitt to initiate a new rulemaking process that would allow interested parties to file comments regarding the Trump administration's intent to unwind the CPP. The process could take several years to be completed, and new litigation is certain to be filed by parties that are supportive of efforts to reduce CO₂ emissions attributable to electric generation.

The executive order also addresses a separate rule previously developed by the EPA to limit the "carbon intensity" rates for yet-to-be-constructed gas-fired plants that effectively prevents new coal-fired power plant construction; rescinds certain methane regulations pertaining to oil and natural gas drilling and hydraulic fracturing; removes the moratorium on federal coal-leasing activities, such that mining operations on federal land could be expanded; directs federal agencies to identify existing policies that "potentially burden the development or use of domestically produced energy resources, with particular attention to oil, natural gas, coal, and nuclear energy"; and seeks to amend the "social cost of carbon," which the Obama administration had used in its efforts to curtail CO₂ emissions, such that the new administration can "ensure sound regulatory decision making [based on] estimates of costs and benefits ... that are based on the best available science and economics."

The executive order's stated intent is to "promote clean and safe development of [the country's] energy resources, while at the same time avoiding regulatory burdens that unnecessarily encumber energy production, constrain economic growth, and prevent job creation."

In remarks made during the formal signing of the executive order at the EPA's headquarters, Trump stated that the intent of his action is to "put an end to the war on coal ... and to cancel job-killing regulations." The President referred to the CPP as a "crushing attack on American industry," and suggested that the plan is among many policies that have resulted in the "theft of American prosperity."

Background and overview of CPP

On Aug. 3, 2015, the EPA released the final version of its CPP, in which the agency sought to reduce CO2 from existing coal-fired plants by 32% below 2005 levels by 2030, and increase the fuel diversity of the nation's power plant fleet. The CPP was crafted in accordance with the terms of a 2013 directive from President Obama that instructed the EPA to develop regulations, in accordance with section 111(d) of the Clean Air Act, that address exclusively CO2 emissions from existing plants.

To provide flexibility to states and utilities in meeting the targets, the EPA established interim and final statewide carbon reduction requirements in three forms: a rate-based state goal measured in pounds CO2/MWH, a mass-based state goal measured in total tons of CO2 and a mass-based state goal with a "new source" complement measured in total tons of CO2. States would then have developed plans that ensure that the power plants in their state — either individually, together or in combination with other measures — achieve the interim CO2 emission rates over the period 2022 through 2029, and the final CO2 emission rates, rate-based goals or mass-based goals by 2030.

The CPP required states to prepare, and submit for EPA approval, state implementation plans, or SIPs, describing how they would comply with the emission targets. The CPP set a deadline of Sept. 6, 2016, for states to either submit their SIPs or seek to extend the SIP submission deadline until Sept. 6, 2018. The CPP required the interim targets to be met beginning in 2022, with attainment of the final targets required by 2030.

Legal challenges

Almost immediately, the CPP faced resistance. A number of states with a strong reliance on coal fired generation and/or mining operations began to challenge the CPP when it was still in draft form in mid-2014, and ramped up their efforts to block implementation of the plan following publication in the Federal Register. In addition, certain industrial companies have criticized nearly every aspect of the CPP, and have themselves challenged the constitutionality and legality of the plan.

In October 2015, a coalition of 24 states led by West Virginia, filed a lawsuit with the D.C. Circuit challenging the CPP and a motion for stay and expedited consideration the same day. The lawsuit asserts that the final rule is in excess of the EPA's statutory authority, goes beyond the bounds set by the United States Constitution, and otherwise is arbitrary, capricious, an abuse of discretion and not in accordance with law. Individual appeals were also filed by Oklahoma, North Dakota and Mississippi.

In November 2015, a coalition of 18 states and the District of Columbia filed a motion to intervene in the case in support of the CPP. The states included New York, California, Connecticut, Delaware, Hawaii, Illinois, Iowa, Maine, Maryland, Massachusetts, Minnesota, New Hampshire, New Mexico, Oregon, Rhode Island, Vermont, Virginia and Washington. In addition, various cities filed comments in support of the CPP. In their motion, the intervenors assert, "The Clean Power Plan requires states to implement standards to reduce greenhouse gas emissions from fossil-fueled power plants, the country’s largest source of such emissions. These emission reductions will help prevent and mitigate harms that climate change poses to human health and the environment, including increased heat-related deaths, damaged coastal areas, disrupted ecosystems, more severe weather events, and longer and more frequent droughts."

In January 2016, the D.C. Circuit unanimously denied the coalition's request for a stay. Also in January 2016, a coalition of states and various state agencies led by the attorneys general of Kentucky and Texas filed a request with the Supreme Court to stay implementation of the CPP.

In a five-to-four decision issued in February 2016, the Supreme Court stayed implementation of the CPP while the rule is under review by the D.C. Circuit. The court's ruling took the legal community by surprise, with legal pundits contending the court's decision to stay a proceeding while under review at a lower court as extremely rare. The court provided no rationale for the stay. However, the standards for issuing a stay generally rest upon the following factors: likelihood of success on the merits, irreparable harm, balance of equities and public interest. Legal experts suggested that perhaps the stay signaled that the then-majority of the court was sympathetic to the petitioner's assertions regarding the legality of the rule. The Supreme Court did not issue a decision on the merits of the rule.

The untimely death of Supreme Court Justice Antonin Scalia in February 2016 left a void on the Court, such that the Court is now divided evenly by ideology, balanced between four typically conservative leaning justices — John Roberts, Anthony Kennedy, Clarence Thomas and Samuel Alito, and four liberal justices — Ruth Bader Ginsburg, Stephen Breyer, Sonia Sotomayor and Elena Kagan. However, on Feb. 1, 2017, Trump nominated Judge Neil Gorsuch of the U.S. Court of Appeals for the Tenth Circuit to fill the vacancy on the Supreme Court. Hearings on Judge Gorsuch's nomination were held in the U.S. Senate earlier in March 2017.

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