US Supreme Court Declines to Block EPAs Carbon Capture Rule for Power Plants

The US Supreme Court has denied requests from electric utility trade groups for an emergency stay of a final Environmental Protection Agency rule requiring 90% carbon capture at existing coal-fired power plants and new gas-fired generators by 2032.

This decision means that affected power generators will not need to start compliance work until June 2025, giving them time before the regulations take effect.

In a brief Oct. 16 order, Justice Brett Kavanaugh stated that applicants for the stay, including the Edison Electric Institute and National Rural Electric Cooperative Association, had shown "a strong likelihood of success on the merits" on at least some of their arguments against the EPA rule. However, he noted that because the regulations won’t require immediate action, the applicants are unlikely to suffer irreparable harm before the case proceeds.

"This court understandably denies the stay applications for now," Kavanaugh said in a statement joined by Justice Neil Gorsuch. "Given that the DC Circuit is proceeding with dispatch, it should resolve the case in its current term."

The Supreme Court's Oct. 16 order also noted that Justice Clarence Thomas would have granted the applications for stay, while Justice Samuel Alito did not participate in the consideration or decision on the applications.

The Edison Electric Institute (EEI), the nation's investor-owned utility trade group, argued that the EPA rule relies on unproven technology and contradicts the Supreme Court's recent Loper Bright decision, which limits deference to federal agencies. EEI raised concerns over the feasibility of carbon capture technology being adequately demonstrated.

The National Rural Electric Cooperative Association (NRECA) also argued that the rule violates the high court's major questions doctrine, which holds that agencies cannot regulate on matters of "vast political or economic significance" without clear authorization from Congress. This doctrine was cemented in the Supreme Court’s 2022 ruling against the Obama-era Clean Power Plan, which sought to transition the US away from coal-fired electricity.

In July, the DC Circuit rejected requests to stay the Biden administration’s EPA regulations, reasoning that petitioners failed to show a likelihood of success on claims that the EPA acted arbitrarily or capriciously in selecting carbon capture as the best achievable control technology for greenhouse gas emissions from power plants.

The trade group is disappointed by the Supreme Court's decision but will continue to press its case at the DC Circuit, said Alex Bond, EEI's executive director of clean energy and environment. "While EEI's member electric companies are investing in carbon capture and storage and are excited by its potential, the current reality is that this technology has yet to be adequately demonstrated as required by the Clean Air Act," Bond said in an email to S&P Global Commodity Insights.

Justice Kavanaugh noted that petitioners are free to ask the Supreme Court for review after the DC Circuit decides the underlying case in West Virginia v. EPA (No. 24-1120).