TOPEKA – (November 26, 2014) – The U.S. Supreme Court has agreed to hear a challenge brought by Kansas and 20 other states against new federal regulations that would drive up costs to Kansas electricity ratepayers, Kansas Attorney General Derek Schmidt announced today.
“The EPA just flat ignored the cost of its new regulation,” Schmidt said. “In the real world, where Kansas homeowners and businesses live, the cost of electricity is always a relevant part of making decisions. The EPA cannot possibly have concluded that the benefits of its new regulation outweigh the costs since it didn’t weigh the costs at all. I’m encouraged that the Supreme Court has agreed to hear the states’ arguments that the EPA’s actions were unlawful.”
In 2011, the EPA released a final maximum achievable control technology (MACT) rule for electric utilities, known as the “Mercury and Air Toxics Standards” or “MATS.” The rule imposes stringent limits on certain emissions from power plants that will require the installation of costly new equipment. The emission limits in the final rule, along with the short deadlines for compliance, are expected to present significant challenges for owners and operators of existing coal- and oil-fired electric utility units and will present a barrier to the construction of new coal-fired generators.
The Supreme Court yesterday agreed to review a decision by the U.S. Court of Appeals for the D.C. Circuit. The lower court decided in April, in a split decision, that EPA need not consider costs in determining whether to impose new regulations on electric utilities. On further appeal by 21 states, including Kansas, the U.S. Supreme Court has agreed to consider whether the EPA unreasonably refused to consider costs in determining the appropriateness of these regulations.
“EPA excluded any consideration of costs when deciding whether it is ‘appropriate’ under the Clean Air Act to impose significant new regulations on electric utilities,” Schmidt said. “It is the view of the challenging states, and the D.C. Circuit’s dissenting judge, that it is unreasonable for EPA to exclude consideration of costs in determining whether it is ‘appropriate’ to impose massive and costly new regulations on electric utilities which, of course, will pass those costs through to ratepayers.”
The case is Michigan v. EPA. Oral arguments will be scheduled later this term with a decision expected by June.