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Record Number of States Launch Legal Challenge to Clean Power Plan

Twenty six States this week filed legal challenges to the Clean Power Plan in the federal court of appeals for the D.C. Circuit. As far as I’ve been able to discern, this is a record number of States to challenge a Clean Air Act rule, and more States are likely to join.

The States are seeking to have the court delay implementation of the regulation until the legal challenge to the merits of the rule runs its course. The reason that States are seeking to pause implementation of the rule is the fact that capital-intensive businesses like electric utilities (the regulated entities) have to plan capital allocation years in advance. As such, many utilities don’t have the opportunity to wait until the litigation reaches a conclusion, which would take about three years, before they decide whether or not to comply with the regulation. In this manner, EPA could achieve compliance with the rule, even if the Supreme Court ultimately finds the Clean Power Plan to be illegal. The solution to this problem is to ask the court to pause or “stay” the rule until it decides on the rule's legality.

The bar for achieving a stay is high. However, the rule is unprecedented in the harm it would inflict, so I think the odds of success are relatively good. The D.C. Circuit will likely decide in early 2016. Were the D.C. Circuit to demur on a stay, I suspect that the petitioners would appeal such a decision to the Supreme Court.