Respondents Brief — West Virginia, et al., Petitioners v. Environmental Protection Agency, et al.

No. 20-1530

In the Supreme Court of the United States

STATE OF WEST VIRGINIA, ET AL.,

PETITIONERS,

v.

U.S. ENVIRONMENTAL PROTECTION AGENCY AND

MICHAEL REGAN, ADMINISTRATOR OF THE U.S.

ENVIRONMENTAL PROTECTION AGENCY,

RESPONDENTS.

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

BRIEF OF RESPONDENT NATIONAL MINING

ASSOCIATION IN SUPPORT OF THE PETITION

CARROLL WADE

MCGUFFEY III

TROUTMAN PEPPER

HAMILTON SANDERS LLP

600 Peachtree St. N.E.

Suite 3000

Atlanta, GA 30308

(404) 885-3698

mack.mcguffey@

troutman.com

MISHA TSEYTLIN

Counsel of Record

SEAN T.H. DUTTON

TROUTMAN PEPPER

HAMILTON SANDERS LLP

227 W. Monroe St.

Suite 3900

Chicago, IL 60606

(608) 999-1240

misha.tseytlin@

troutman.com

Counsel for National Mining Association

QUESTION PRESENTED

In 42 U.S.C. § 7411(d), an ancillary provision of

the Clean Air Act, did Congress constitutionally

authorize the Environmental Protection Agency to

issue significant rules—including those capable of

reshaping the nation’s electricity grids and

unilaterally decarbonizing virtually any sector of the

economy—without any limits on what the agency can

require so long as it considers cost, nonair impacts,

and energy requirements?

ii

CORPORATE DISCLOSURE STATEMENT

National Mining Association is a non-profit

corporation that has no parent corporation; no

publicly held company owns 10% or more of National

Mining Association’s stock.

iii

TABLE OF CONTENTS

Page

QUESTION PRESENTED ......................................... i

CORPORATE DISCLOSURE STATEMENT ........... ii

ADDITIONAL REASONS FOR GRANTING THE

PETITION ...................................................................3

I.

Declining To Answer The Question

Presented Now Will Harm The Energy

Economy, In General, And Coal-Fired

Energy, In Particular, By Forcing The EPA

to Consider Generation Shifting, Creating

Unnecessary Uncertainty For Years ...............3

II. This Court Should Not Await The EPA’s

Response To The D.C. Circuit’s Mandate

Because The Legality Of That Mandate Is

Exactly What Is In Dispute In The Question

Presented ..........................................................9

CONCLUSION ..........................................................13

iv

TABLE OF AUTHORITIES

Cases

Nat’l Ass’n of Mfrs. v. Dep’t of Def.,

138 S. Ct. 617 (2018)..................................... 12, 13

Pac. Gas & Elec. Co. v. State Energy Res.

Conservation & Dev. Comm’n,

461 U.S. 190 (1983) ....................................... 5, 7, 9

Util. Air Regulatory Grp. v. EPA, 573 U.S. 302

(2014) ................................................................... 12

Statutes And Rules

42 U.S.C. § 7411 ......................................................... 1

Sup. Ct. R. 12.6 .......................................................... 1

Regulations

Carbon Pollution Emission Guidelines for

Existing Stationary Sources: Electric Utility

Generating Units, 80 Fed. Reg. 64,662 (Oct.

23, 2015) ...................................................... 6, 7, 13

Repeal of the Clean Power Plan; Emission

Guidelines for Greenhouse Gas Emissions

From Existing Electric Utility Generating

Units; Revisions to Emission Guidelines

Implementing Regulations, 84 Fed. Reg.

32,520 (July 8, 2019)................................. 1, 10, 13

v

Other Authorities

America’s Power, Coal Abundance (Jan. 7, 2017) .... 8

Envtl. Prot. Agency, Overview of the Clean Power

Plan (Aug. 2015) ................................................... 7

Jeff St. John, PJM: Fuel Security Issues Won’t

Disrupt the Grid, Unless Coal & Nuclear

Closures Skyrocket, GreenTechMedia.com

(Nov. 1, 2018) ........................................................ 8

Kevin L. Kliesen, Uncertainty & the Economy,

The Regional Economist (Apr. 2013) ................... 5

Nat’l Academy of Eng’g, Time Horizons &

Technology Investments (1992) ........................... 5

Nat’l Ass’n of State Energy Officials, et al.,

Wages, Benefits, & Change: A Supplemental

Report to the Annual U.S. Energy &

Employment Report (2020) .................................. 4

Nat’l Research Council, Coal: Energy for the

Future (Nat’l Acads. Press 1995) ......................... 8

Nat'l Mining Ass'n, Coal: Reliable & Affordable

Power (Feb. 2021) ................................................. 4

Order Denying Motion To Hold The Briefing

Schedule In Abeyance, Nat’l Ass’n of Mfrs. v.

Dep’t of Def., No. 16-299 (U.S. Apr. 3, 2017) ..... 12

Per Curiam Order, No. 19-1140, Doc.1886386

(D.C. Cir. Feb. 22, 2021) ........................... 6, 11, 12

vi

Resp’ts Mot. For Partial Stay Of Issuance Of The

Mandate, No. 19-1140, Doc.1885168 (D.C. Cir.

Feb. 12, 2021) ...................................................... 11

Resp’ts Notice Of Exec. Order & Related Agency

Action & Motion To Hold The Briefing

Schedule In Abeyance, Nat’l Ass’n of Mfrs. v.

Dep’t of Def., No. 16-299 (U.S. Mar. 6, 2017) .... 12

Robert Walton, NERC Identifies 4 Regions

Facing Potential Summer Energy Shortages,

UtilityDive.com (May 18, 2021) ........................... 9

Seth Schwartz, Evaluation of the Immediate

Impact of the Clean Power Plan Rule on the

Coal Industry (Energy Ventures Analysis, Inc.

Oct. 2015) .......................................................... 5, 7

Status Report, No. 19-1140, Doc.1899829 (D.C.

Cir. May 24, 2021) .............................................. 11

U.S. Energy Info. Admin., Analysis of the

Impacts of the Clean Power Plan (May 2015) ..... 7

U.S. Gov’t, Cybersecurity & Infrastructure Sec.

Agency, Energy Sector .......................................... 4

INTRODUCTION

Pursuant to Rule 12.6, Respondent National

Mining Association (“NMA”) submits this brief in

support of the Petition filed by the State of West

Virginia and other States (“Petitioner States”). NMA

is the only national trade organization that

represents the interests of mining before Congress,

federal agencies, the judiciary, and the media. NMA’s

membership includes more than 250 corporations and

organizations involved in aspects of mining, including

producers, transporters, and consumers of coal. NMA

and its members are thus deeply interested in the

regulations of the energy sector that the EPA adopts

under Section 111(d), 42 U.S.C. § 7411(d), including

the fate of the Affordable Clean Energy Rule, Repeal

of the Clean Power Plan; Emission Guidelines for

Greenhouse Gas Emissions From Existing Electric

Utility Generating Units; Revisions to Emission

Guidelines Implementing Regulations, 84 Fed. Reg.

32,520 (July 8, 2019).

NMA agrees entirely with the Petitioner States’

arguments as to why this Court should grant the

Petition. See Pet. 13–34. NMA files this brief to

emphasize two additional points as to why this Court

should answer the Question Presented now.

First, a years’ long delay in answering the

Question Presented will impose unnecessary harms

upon a sector of the economy that the panel below

properly recognized is as virtually “indispensable to

2

modern life as air itself.” App.27a. The operation of

the energy economy, in general, and coal-fired energy,

in particular, requires long-ranging planning and

large capital investments. Uncertainty as to whether

the EPA has authority to mandate generationshifting from coal-fired generation to natural gas and

renewable sources, and whether it will actually do so,

is a critically important input that will drive

significant economic decisions now that will be costly,

if not impossible, to reverse. All stakeholders would

thus benefit greatly from this Court’s definitive word

as to whether the EPA has the authority to impose

regulatory burdens based on generation shifting, or

whether—as Petitioner States correctly explain—the

statutory text and the Major Questions Doctrine

foreclose the EPA from claiming such an awesome

power to remake the energy economy.

Second, this Court should not wait for the EPA to

complete a new rulemaking in response to the D.C.

Circuit’s mandate for the additional reason that the

legality of the D.C. Circuit’s mandate is precisely

what is in dispute in the Question Presented. Absent

this Court’s decision on the Question Presented, the

EPA will replace the Affordable Clean Energy Rule in

accordance with the D.C. Circuit’s erroneous opinion,

which requires the agency to consider mandating

emission reductions based upon electricity-grid-wide

generation shifting. This Court should decide now the

bedrock issue as to whether Section 111(d) authorizes

the EPA to require reductions based upon

transforming the electricity grid, and thus avoid

3

sending the agency on another misguided, multi-year

Section 111(d) rulemaking.

This Court should grant the Petition.

ADDITIONAL REASONS FOR

GRANTING THE PETITION

I.

Declining To Answer The Question Presented

Now Will Harm The Energy Economy, In

General, And Coal-Fired Energy, In Particular,

By Forcing The EPA to Consider Generation

Shifting, Creating Unnecessary Uncertainty For

Years

Declining to answer the Question Presented now

will leave the energy economy, especially the coalfired energy sector, in a state of significant

uncertainty for years, while all must wait for the EPA

to act on the D.C. Circuit’s mandate for a new

rulemaking that considers generation shifting. If that

mandate is wrong, the years lost will cause needless

harms that cannot later be undone.

A robust, well-functioning energy sector—aided

and driven in large part by coal-generated power—is

essential to our Nation’s wellbeing. As the panel

majority recognized, “[e]lectrical power has become

virtually as indispensable to modern life as air itself.”

App.27a. Further, the energy sector is a major

contributor to employment and economic growth. At

the close of 2019, more than 8.27 million Americans,

4

representing roughly 5.4% of the total workforce,

worked in the energy sector. Nat’l Ass’n of State

Energy Officials, et al., Wages, Benefits, & Change: A

Supplemental Report to the Annual U.S. Energy &

Employment Report 1 (2020) (fact sheet).1 The coal

industry directly employs over 185,000 individuals,

Nat’l Ass’n of State Energy Officials, et al., Wages,

Benefits, & Change: A Supplemental Report to the

Annual U.S. Energy & Employment Report 47 tbl.6

(2020),2 and “every job in coal mining” “creat[es] [ ] 3.3

jobs” elsewhere, NMA, Coal: Reliable & Affordable

Power 1 (Feb. 2021).3 The energy economy is also part

of our Nation’s “uniquely critical” infrastructure,

“provid[ing] an ‘enabling function’ across all critical

infrastructure sectors,” as it “fuels the economy of the

21st century.”

U.S. Gov’t, Cybersecurity &

Infrastructure Sec. Agency, Energy Sector.4

Regulatory predictability is crucial for the robust

functioning of America’s energy economy. “[T]oo

much uncertainty is the natural enemy of long-term

investment,”

and

so

“frequent

changes

Available at https://www.usenergyjobs.org/s/Fact-SheetThe-Wage-Report.pdf (all websites last accessed on May 27,

2021).

1

Available

Report.pdf.

2

at

https://www.usenergyjobs.org/s/Wage-

3 Available at https://nma.org/wp-content/uploads/2018/02/

coal_reliable_power_2021.pdf.

4 Available at https://www.cisa.gov/energy-sector.

5

in . . . regulatory structures . . . and other forms of

government interaction with industry can be quite

damaging.” Nat’l Academy of Eng’g, Time Horizons &

Technology

Investments

60–61

(1992).5

Unpredictable changes in government policy “are

important at the micro level,” affecting “a firm’s

decision to invest.” Kevin L. Kliesen, Uncertainty &

the Economy, The Regional Economist (Apr. 2013).6

Regulatory stability is vital “for long-lived investment

projects that are economically costly to reverse.” See

id. Investors facing regulatory uncertainty are less

likely to invest, especially in projects that involve

long-term, rather than short-term, time horizons. See

id. And investments in the energy sector, more

generally, require “considerable advance planning”

given the capital investments necessary to build out

new sources of electricity generation, Pac. Gas & Elec.

Co. v. State Energy Res. Conservation & Dev.

Comm’n, 461 U.S. 190, 201–02 (1983), and

“significant lead time[s]” are common even to

“maintain

production”

in

“existing

mining

operations,” see Seth Schwartz, Evaluation of the

Immediate Impact of the Clean Power Plan Rule on

the Coal Industry 48–50 (Energy Ventures Analysis,

Inc. Oct. 2015).

5 Available at https://www.nap.edu/download/1943.

6 Available at https://www.stlouisfed.org/~/media/files/pdfs/

publications/pub_assets/pdf/re/2013/b/uncertainty.pdf.

6

Within this economic context, a refusal by this

Court to resolve the Question Presented now—thus

leaving unknowable to industry actors and potential

investors whether the EPA can and will use Section

111(d) to, in effect, require generation shifting—will

have dramatically negative impacts on the entire

energy economy, especially as to coal. Uncertainty

about whether the EPA will require a generationshifting best system of emission reduction (“BSER”)

makes investment and planning in the energy sector

extremely difficult. The D.C. Circuit’s mandate

directly requires the EPA to consider generation

shifting as a legal alternative, see Per Curiam Order,

No. 19-1140, Doc.1886386 (D.C. Cir. Feb. 22, 2021)

(hereinafter “Doc.1886386”); App.101a, 161a–63a,

and the EPA chose that alternative in the Clean

Power Plan when it believed the law allowed it, see

Carbon Pollution Emission Guidelines for Existing

Stationary Sources: Electric Utility Generating Units,

80 Fed. Reg. 64,662, 64,745–46 (Oct. 23, 2015).

Without this Court’s review, the energy industry and

its investors will be forced to lean into that possibility

in making significant long-term investment decisions.

As Judge Walker explained below, when the

Clean Power Plan used the generation-shifting

methodology for setting the BSER, the price of

compliance was “almost unfathomable,” with cost

estimates in the many tens of billions of dollars in

both “electricity[ ] costs” and “shuttered capacity.”

App.174a; see also U.S. Energy Info. Admin., Analysis

of the Impacts of the Clean Power Plan 63–64 (May

7

2015).7 NMA’s own evaluation of the potential impact

of the generation shifting needed to comply with the

Clean Power Plan, confirms the dramatic impact that

this theory could have on the coal industry and the

country. See Schwartz, supra, at 1–2. Facing

uncertainty as to whether the EPA has that level of

authority and will use it to impose that level of costs

would be problematic for any industry, and will be

particularly harmful to the energy sector, given its

long-term planning time horizon. See Pac. Gas &

Elec., 461 U.S. at 201–02.

Unpredictability about whether generationshifting is a permissible tool for the EPA to set

emission reductions, and whether the EPA will

actually use that powerful tool, as it has before, see 80

Fed. Reg. 64,662, is a core concern affecting the coal

industry. The generation-shifting methodology—as

the EPA articulated it in the Clean Power Plan—

makes coal-fired generation less desirable, and

natural gas and renewable-energy generation more

desirable, from the point of view of regulatory costs.

See EPA, Overview of the Clean Power Plan 4 (Aug.

2015).8 That is why the question of whether the EPA

can mandate this thumb on the scales against coalfired generation is a critically important factor that a

reasonable investor or utility would need to know

7 Available at https://www.eia.gov/analysis/requests/power

plants/cleanplan/pdf/powerplant.pdf.

Available at https://archive.epa.gov/epa/sites/production/

files/2015-08/documents/fs-cpp-overview.pdf.

8

8

now, not years in the future. Specifically, if investors

and utilities believe, as the D.C. Circuit has said, that

the EPA has the power to impose emission reductions

based upon generation shifting, they will naturally

favor renewable and natural gas facilities, which will

inevitably result in reduced utilization and,

eventually, retirement of coal-fired generation.

These harms to the coal industry will harm our

Nation’s energy prosperity and security. Unlike

many forms of energy production, coal is not a

“resource limited” product in the near- or long-term,

with stable reserves available in the United States for

decades to come. Nat’l Research Council, Coal:

Energy for the Future 3–4 (Nat’l Acads. Press 1995);

see America’s Power, Coal Abundance (Jan. 7, 2017)

(“There’s no question that coal is America’s most

abundant, domestically produced energy resource.”).9

This abundance makes coal essential to our energy

grid, due to its resilience as a fuel-secure,

dispatchable resource with the possibility of keeping

months of fuel on site, which has played a critical role

in maintaining reliability during bitter cold, see Jeff

St. John, PJM: Fuel Security Issues Won’t Disrupt the

Grid, Unless Coal & Nuclear Closures Skyrocket,

GreenTechMedia.com (Nov. 1, 2018),10 and other

Available

abundance/.

9

at

https://www.americaspower.org/coal-

Available at https://www.greentechmedia.com/articles/

read/pjm-fuel-security-wont-disrupt-grid-unless-coal-nuclearclosures.

10

9

threats to reliability, including a growing number of

cyber-attacks, Robert Walton, NERC Identifies 4

Regions Facing Potential Summer Energy Shortages,

UtilityDive.com (May 18, 2021).11 Thus, by further

depressing coal-fired resources, the uncertainty over

whether the EPA can and will force generation

shifting has the potential to exacerbate these threats

to the Nation’s energy security.

In all, unless this Court takes this opportunity to

address the legality of the EPA adopting a generationshifting approach, the specter of future EPAmandated generation shifting that the D.C. Circuit’s

opinion created will hang over the energy sector. In

turn, “requir[ing] the [energy] industry to proceed

without knowing” the ultimate resolution of this

question by this Court “would impose a palpable and

considerable hardship on the utilities, and may

ultimately work harm on the citizens” of this country.

Pac. Gas & Elec. Co., 461 U.S. at 201–02.

II. This Court Should Not Await The EPA’s Response

To The D.C. Circuit’s Mandate Because The

Legality Of That Mandate Is Exactly What Is In

Dispute In The Question Presented

Even aside from the economic harms that the D.C.

Circuit’s decision will cause absent this Court’s

11 Available at https://www.utilitydive.com/news/nerc-cyber

security-concerns-summer-energy-shortages-texas-california/60

0324/.

10

review, a definitive answer from this Court is needed

to ensure the EPA’s next rule is legally correct. As

such, the EPA’s new efforts to begin writing that next

rule under the D.C. Circuit’s mandate is a powerful

reason for immediate review, not against such review.

The Question Presented involves two conflicting

visions of the EPA’s authority under Section 111(d).

On the one hand, in the Affordable Clean Energy

Rule, the EPA correctly concluded that Section 111(d)

requires the agency to determine the BSER by looking

only to measures that can be applied at individual

existing sources. See 84 Fed. Reg. at 32,526–27,

32,534. The statutory text and context do not permit

the agency to base its BSER on generation shifting

because the BSER must be applied at a “building,

structure, facility, or installation,” id. at 32,523–24,

and cannot require power plant owners to operate

their plants less, id. at 32,531–32, or subsidize

competitor sources of energy, see id. at 32,527. And

because such generation shifting would transform the

energy economy, Congress would have to speak

unambiguously if it sought to give the EPA such broad

powers, which Congress did not do in Section 111(d).

Id. at 32,529. On the other hand, the panel majority

below wrongly rejected this reading of Section 111(d),

holding that the EPA is required to consider

generation shifting, see App.56a, 91a n.9, 99a, 100a–

01a, and that the Major Questions Doctrine did not

apply, App.83a–103a. That decision “go[es] beyond”

even the Clean Power Plan itself. Pet. 10, 28.

11

The D.C. Circuit not only endorsed this erroneous

view, but now has directed the EPA to move forward

with “a new rulemaking action,” consistent with its

opinion. Doc.1886386; accord App.162a. The EPA, in

turn, has represented to the court that it will

“respond[ ] to the Court’s remand in a new

rulemaking action.” Resp’ts Mot. For Partial Stay Of

Issuance Of The Mandate at 4, No. 19-1140,

Doc.1885168 (D.C. Cir. Feb. 12, 2021). And it has

since advised the D.C. Circuit that “administrative

proceedings to respond to the Court’s remand in a new

rulemaking action are ongoing.” Status Report at 3,

No. 19-1140, Doc.1899829 (D.C. Cir. May 24, 2021).

The D.C. Circuit’s mandate for a new rule, and

the EPA’s efforts to comply with that mandate, offer

an additional, powerful reason why this Court should

decide the Question Presented now, given that the

legality of the mandate is precisely what is in dispute

in the Question Presented. According to the D.C.

Circuit, the EPA must consider generation shifting as

an available option in the “new rulemaking action”

that the D.C. Circuit ordered. Doc.1886386. But if

the EPA was right in the Affordable Clean Energy

Rule as to the scope of its authority—which, as

Petitioner States correctly explained, it was, Pet. 25–

34—that is not a legally permissible approach.

Deciding the Question Presented now is the only

way to avoid forcing the agency to waste significant

time considering options that are outside the scope of

its authority, under a proper understanding of

12

Section 111(d). As this Court has opined in a closely

related context, this Court should not “stand on the

dock and wave goodbye as EPA embarks on this

multiyear voyage of discovery.” Util. Air Regulatory

Grp. v. EPA, 573 U.S. 302, 326 (2014).

A comparison of this case to the circumstances in

National Association of Manufacturers v. Department

of Defense, 138 S. Ct. 617 (2018) (“NAM”), illustrates

why this Court should not delay in answering the

Question Presented while the EPA engages in a “new

rulemaking action” to comply with the D.C. Circuit’s

mandate. See Doc.1886386. In NAM, this Court

granted review on a legal issue regarding judicial

review of a rule issued jointly by the EPA and the U.S.

Army Corps of Engineers. NAM, 138 S. Ct. at 624.

Even though the agencies had already proposed to

repeal and replace the preexisting rule, this Court

decided the legal issue, NAM, 138 S. Ct. at 628 n.5,

contrary to the agencies’ urging, see Resp’ts Notice Of

Exec. Order & Related Agency Action & Motion To

Hold The Briefing Schedule In Abeyance at 3, Nat’l

Ass’n of Mfrs. v. Dep’t of Def., No. 16-299 (U.S. Mar.

6, 2017); Order Denying Motion To Hold The Briefing

Schedule In Abeyance, id. (U.S. Apr. 3, 2017).

There is far less reason for this Court to hesitate

here, in the face of future agency action, than there

was in NAM. In the present case, the EPA has not

yet even proposed a rule to repeal and replace the

Affordable Clean Energy Rule, and this entire

process—just beginning—will take a long time. See

13

80 Fed. Reg. at 64,662, 64,665 (Clean Power Plan

effective date more than 18 months after the

proposal); 84 Fed. Reg. at 32,520, 32,532 (Affordable

Clean Energy Rule effective date more than 21

months after proposal to repeal Clean Power Plan,

and more than 12 months after proposed Affordable

Clean Energy Rule). Therefore, this case is unlikely

to become moot during the time it would take this

Court to rule on the merits. See NAM, 138 S. Ct. at

628 n.5. Quite the opposite, this Court’s definitive

answer to the Question Presented now is critical so

that the EPA does not write a rule under an erroneous

mandate from the D.C. Circuit.

CONCLUSION

This Court should grant the Petition.

Respectfully submitted,

CARROLL WADE

MCGUFFEY III

TROUTMAN PEPPER

HAMILTON SANDERS LLP

600 Peachtree St. N.E.

Suite 3000

Atlanta, GA 30308

(404) 885-3698

mack.mcguffey@

troutman.com

May 2021

MISHA TSEYTLIN

Counsel of Record

SEAN T.H. DUTTON

TROUTMAN PEPPER

HAMILTON SANDERS LLP

227 W. Monroe St.

Suite 3900

Chicago, IL 60606

(608) 999-1240

misha.tseytlin@

troutman.com