I wrote recently
about New York State’s Climate Superfund law that fines companies
that sell hydrocarbons in the state for their carbon emissions, even
retroactively, noting that it was bonkers, unfair, and unconstitutional, and
that it will likely not survive legal challenges. Some of those arguing against
it noted that it is the EPA, not states, that is tasked with regulating
greenhouse gases. However, if the EPA strikes down the ‘endangerment finding’
that is the basis for regulating greenhouse gases, does that give states an
opportunity to jump in and make their own regulations? I would hope not, but
some do, apparently, think that it is possible, calling it a potential ‘silver
lining’ to the striking down of the finding that six greenhouse gases are
pollutants that endanger public health and must be mitigated.
The question then arises: “Is
it better for the federal government/EPA to regulate greenhouse gases or the
states?” I am thinking that it is better that they are regulated at the
federal level, but not over-regulated. I could be wrong, but I don’t think that
there are very many companies seeking to emit more greenhouse gases to save
money. This is due to many factors, including taking pride in reducing
emissions through technology and smart energy management.
EPA administrator Lee Zeldin
announced plans to revoke the endangerment finding on July 29.
Some are saying that it will give
states the authority to enact their own regulations:
"If the EPA is saying greenhouse gases aren't
supposed to be regulated under the Clean Air Act, then that means they can be
regulated under traditional state authority," said Ann Carlson, the
director of the Emmett Institute on Climate Change and the Environment at UCLA,
according to The Los Angeles Times. "So this could have a silver lining
for California."
Daniel Gala, in an article
for The Cool Down, explains the precedents that inform regulatory authority
between the federal government and states:
“Under the Supremacy Clause of the U.S. Constitution,
where federal law and state law are in direct conflict, federal law prevails.
However, in areas where the federal government has remained silent, states
typically have broad authority to act.”
“Therefore, if the federal government argues that it is
powerless to regulate heat-trapping pollution, it opens the door for states
like California to step in.”
Do we really want different
rules for different states? In some ways, we already have them, such as the
regional greenhouse gas market initiatives. These tend to be among blue states.
State rules that differ too much can affect businesses.
The EPA likely hopes to use
the ending of the endangerment finding to relax regulations on CAFÉ standards
for fuel economy, emissions rules for power plants, and to squelch rules on
methane emissions from the oil & gas industry, landfills, and other
facilities.
California has long carved
out its own emissions rules as much as possible, sometimes being challenged as
too stringent by federal agencies. Do we really want New York and other blue
states to be emboldened to put more stringent regulations on greenhouse gases?
New York has already expressed a strong desire to be draconian and
authoritarian in such regulations, as exemplified by their Climate Change
Superfund Law.
According to the EPA’s
announcement:
“The Endangerment Finding is the legal prerequisite used
by the Obama and Biden Administrations to regulate emissions from new motor
vehicles and new motor vehicle engines. Absent this finding, EPA would lack
statutory authority under Section 202(a) of the Clean Air Act (CAA) to
prescribe standards for greenhouse gas emissions. This proposal, if finalized,
is expected to save Americans $54 billion in costs annually through the repeal
of all greenhouse gas standards, including the Biden EPA’s electric vehicle
mandate, under conservative economic forecasts.”
“If finalized, this proposal would remove all greenhouse
gas standards for light-, medium- and heavy-duty vehicles and heavy-duty
engines, starting with EPA’s first greenhouse gas set in 2010 for light-duty
vehicles and those set in 2011 for medium-duty vehicles and heavy-duty vehicles
and engines—which includes off-cycle credits like the much hated start-stop
feature on most new cars.”
I do not believe the change will result in anything near that amount of savings due to the fact that many automobile manufacturers, power plant owners, and owners of other facilities that emit greenhouse gases will likely continue with current emission control practices. They know that the current administration won’t be in power forever, and it is likely they will have to return to similar, more stringent rules in the future. It remains to be seen whether, and by how much, businesses will go along with the current administration’s and the GOP’s deregulatory push. They have ongoing investments and programs to reduce emissions that they likely intend to continue. They could also end up being regulated more in states that can use their newly found power to regulate to make regulations even more stringent than at the federal level. In these ways, Zeldin’s goal of rescinding the endangerment finding could backfire for businesses.
Another way striking down the finding could backfire has been pointed out by lawyers and trade groups is by increasing regulatory uncertainty and litigation risks for the auto industry, utilities, and manufacturers, as noted in a Reuters article.
Companies have existing sunk investments in emissions reduction. Industries have long been complying with the EPA greenhouse gas emissions rules, and many are happy with their decarbonization efforts. While they may like that they will have less stringent rules, they won't like the increase in regulatory uncertainty. Many will continue with their decarbonization efforts, and some will likely scale them back. It has also been pointed out that a resurgence of state lawsuits and regulations to fill the vacancy could really exacerbate regulatory uncertainty. Thus, it is suggested that the endangerment finding protects against state encroachment and a fragmented regulatory system.
"I think what the administration has missed is that
most of industry has already retrofitted for regulations," said Camille
Pannu, associate law professor at Columbia University. "Industry did want
deregulation, but maybe not through this vehicle."
“One former Trump administration source said during
Trump's first term, the EPA had declined to take on the endangerment finding
because of strong resistance from industry and the legal risk associated with
undermining federal authority on the matter.”
It could also make it so that cases will be resolved in a fragmented way in different district courts with political differences. One value of federal rules is that they are consistent across the country.
The next step in the
process of revoking the rule involves a public comment period.
References:
Officials
poised to fight back as EPA moves to reverse critical regulations: 'This could
have a silver lining'. Daniel Gala. The Cool Down. July 30, 2025. Officials
poised to fight back as EPA moves to reverse critical regulations: 'This could
have a silver lining'
EPA
Releases Proposal to Rescind Obama-Era Endangerment Finding, Regulations that
Paved the Way for Electric Vehicle Mandates: If finalized, this proposal would
undo the underpinning of $1 trillion in costly regulations, save more than $54
billion annually. U.S. EPA. July 29, 2025. EPA
Releases Proposal to Rescind Obama-Era Endangerment Finding, Regulations that
Paved the Way for Electric Vehicle Mandates | US EPA
US
reversal on key climate finding spells uncertainty for business. Valerie
Volcovici. Reuters. July 31, 2025. US
reversal on key climate finding spells uncertainty for business
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