Our Editorial: Clean Power Plan stay a hollow win

The U.S. Supreme Court earlier this week delivered a blow to the Obama administration’s Clean Power Plan, the behemoth regulatory proposal to fight climate change with ambitious clean energy mandates in every state. It’s a monumental decision from the High Court, and signals several justices have serious problems with making law via regulation.

As welcome as the ruling is, the court’s intervention complicates how energy companies and electric utilities invest, and what state energy agencies can plan for, proving an unbridled regulatory state can win even when it loses.

In a written order, the court granted emergency requests by officials in Michigan and 28 other states, corporations and industry groups to delay implementation of the regulations while its legality is challenged.

The plan would require carbon emissions from power plants to be cut 32 percent by 2030, based on 2005 levels.

Lower courts haven’t yet ruled on the CPP, which makes it unusual the court pre-emptively issued a stay. The Wall Street Journal reports this is the first time the court has actually stayed a regulation.

The decision underscores what more than 30 lawsuits against the proposed regulations have claimed: that allowing the regulations would require — almost immediately — new laws, large amounts of money and significant manpower to get states into compliance.

Given the short time frame for the transition, most utilities decided they couldn’t afford to wait for the courts to rule and have begun transitioning their facilities to comply. That means they’ve invested in new technologies and plants to replace those going offline. Michigan will lose nine coal plants over the next year; 25 coal-fired units will be retired in the next five years. Across the region, scores of coal facilities will go offline during that period.

A more reasonable initial proposal from the Obama administration may have helped avoid this situation.

Michigan’s largest utility companies have said they’re in a decent position to comply with the CPP, if it’s enacted. And Gov. Rick Snyder said the recently formed Michigan Agency for Energy would comply with the regulations if approved, but will pause compliance efforts until attorneys review next steps.

There’s disincentive for the state to move ahead, since improvements that come before EPA finalizes deadlines and benchmarks might not be counted.

The court’s ruling was a welcome slap on the wrist for an administration that has tried to use regulatory agencies to rewrite laws that have significant impact on the economy. But the lack of clarity that now ensues is a reminder that economic growth in the U.S. has become hostage to the whims of an ever-growing regulatory state.