If your social media feeds are like mine they’ve been full of cheers and jeers for recent decisions handed down by the U.S. Supreme Court. One decision that may be taking up less space on Facebook and Twitter this week is Michigan v. EPA, which the Court decided on Monday and is worth a hearty cheer.
The case centered on the Environmental Protection Agency’s (EPA) regulation of mercury emissions from coal-fired power plants. Under the Clean Air Act, the EPA may only impose regulations deemed “appropriate and necessary” after studying impacts to public health. In making the determination to regulate, the EPA refused to consider cost, which the Court rightly ruled was unreasonable.
In this particular case, the EPA’s own numbers are astounding. They estimated the compliance cost to power plants would be $9.6 billion a year, while the quantifiable benefits from the resulting emissions reduction would be $4 to $6 million a year. And yet, the EPA deemed cost irrelevant to their decision to regulate.
Here’s what the Court had to say to that:
EPA strayed well beyond the bounds of reasonable interpretation in concluding that cost is not a factor relevant to the appropriateness of regulating power plants.
And, my favorite line from the decision:
It is not rational, never mind “appropriate,” to impose billions of dollars in economic costs in return for a few dollars in health or environmental benefits.
This last statement delivers the true victory by issuing a reality check for out-of-control regulators. While the directive of this Administration’s EPA seems to be “regulate at any cost,” the Supremes checked that mindset by ordering, “EPA must consider cost—including cost of compliance—before deciding whether regulation is appropriate and necessary.”
This decision is a big win for power producers, but ultimately it’s small businesses and all electric power consumers who are the victors. They’re the ones who bear the burden of increased regulatory costs. Now, with a number of EPA and other agency regulations in the works, it’s great to confirm they must consider whether imposed costs are delivering meaningful public benefit in return.
