Yesterday, a federal judge appeared ready to block the Biden administration’s draft metric to calculate the societal damage from greenhouse gas emissions.
During a hearing, Judge James Cain Jr. of the U.S. District Court for the Western District of Louisiana asked whether President Biden overstepped legislative and constitutional powers in ordering federal agencies to apply an interim value for the social cost of carbon.
âI think there’s a big separation of powers issue here that nobody’s really talking about,â Cain said.
The social cost of carbon estimates the release of a metric ton of carbon dioxide in dollars and is used as part of federal agency cost-benefit analyzes for major rules. A higher estimate of the cost of releasing heat-trapping gases helps agency decision-makers advocate more for stricter climate regulations.
Cain, a candidate for Trump, likened the measure to the imposition of a carbon tax.
“Where is the statutory authority of Congress to do this?” ” He asked. “Because I think something like that – I think it’s in the Constitution that only Congress can impose a tax.”
Yesterday’s hearing resulted from a challenge by 10 Republican state attorneys general, led by Jeff Landry of Louisiana, urging the court to block the Biden administration’s interim social cost of carbon, which is $ 51 per tonne emissions metric.
States argued that the Biden administration improperly mandated the use of the interim metric within federal agencies through an executive order without first undergoing a legally required notice and comment period.
The Biden administration previously predicted that an interagency task force would finalize an updated social cost of carbon value in January 2022, although government lawyers have acknowledged that this timeline may change.
Lawyers for the state challengers have been pushing the court to rule on the interim value now, but Cain asked if it would make sense to wait for the interagency task force to finalize the metric next year. That way, he said, the challengers could wage âsurgicalâ legal battles over the rules that enforce the new social cost of carbon.
Such a ruling would follow in the footsteps of another ruling stemming from a social cost of the carbon lawsuit brought by 13 Republican state attorneys general in U.S. District Court for the Eastern District of Missouri.
Judge Audrey Fleissig dismissed the case after finding that the challenge was premature. The judge, appointed by Obama, instead urged the state’s challengers to return to court with a new trial once the social cost of carbon is applied in rule-making.
His decision is currently before the 8th United States Court of Appeals (Green wire, September 2).
Fleissig did a good analysis, Cain said, but “the box has been pushed back a bit.”
Benjamin Wallace, the deputy solicitor general of Louisiana, who represented the Republican states, suggested that the application of the social cost of carbon raised the doctrine of major issues, that courts should not rely on the discretion of the agency on interpretations of the law on matters of “broad or political importance.”
Applying the social cost of carbon was a direct attack on the energy industry and would impose new costs on the American public, he said.
“The question is, the administration, and the president by decree, can they remake the economy?” Wallace asked. “Agencies in many cases have the discretion to regulate and regulate, but there are limits to that discretion.”
Lawyers for the Department of Justice countered that the social cost of carbon was nowhere near as central to agency decision-making as the Republican-led states suggested.
They argued that federal agencies still have the discretion to incorporate the metric according to their applicable laws. They said the president only required the use of the interim social cost of carbon in analyzes of the rules sent to the White House’s Office of Management and Budget.
“This does not mean that provisional estimates will be used in a particular rule,” said Stephen Pezzi, an attorney for the DOJ.
He noted that Republican-led states are free to challenge individual rules that are based on the interim social cost of carbon.
Agencies use the metric in regulatory impact analyzes that examine the possible effects of federal rules, added Cody Knapp, another DOJ lawyer.
âI don’t think the interim estimates are a break from the past,â Knapp said.
But federal agencies also use the social cost of carbon in environmental scans, which can affect whether a project like a highway extension can go ahead, Cain said.
“Decisions are made on the basis of environmental impact studies,” he said.
Cain also questioned the Biden administration’s rationale for increasing the social cost of carbon by $ 1 per metric tonne, which was the value adopted by the Trump administration.
While Team Biden’s interim carbon social is a significant increase over the Trump-era estimate, the metric is comparable to the value used under former President Obama, once adjusted for inflation. .
Cain asked if the Biden administration erred in including global emissions as part of the metric. In contrast, the Trump administration’s value was based solely on domestic broadcasts.
The judge asked where the Biden team got data on emissions from other countries and suggested establishing an international treaty “so everyone follows the same rules.”
“This is the only way to have a global effect,” he said. “I really have a problem with the whole world part of it.”
This story also appears in Energy wire.