In the News

A recently introduced bill aiming to prevent federal agencies from considering the Social Cost of Greenhouse Gases highlights the role some bills play in informing — and sometimes misinforming — the public. Though almost certainly destined to fail, the bill presents faulty and misleading criticisms that could have chilling effects on important policy evaluation efforts.

The ruling [West Virginia v. Environmental Protection Agency (EPA)] is a blow to climate action and could signal the court’s hostility to a wide range of future regulations within and beyond the climate and environmental sphere, including those related to consumer protection and worker safety. Although the immediate effects on US climate policy aren’t pervasive, EPA now needs to evaluate the emissions-reduction potential and legal risks of alternative regulatory approaches for the power sector.

Transmission issues are the most common challenge, if not the most daunting, experts say. As such, states with steep clean energy goals need to make sure they're not just building fast, but building the right kind of transmission infrastructure, Justin Gundlach of the Institute for Policy Integrity told Law360. On top of that, developers need to make sure they're displacing legacy generation from coal or natural gas, he added. "It's great building renewables, but are they building the right kind of transmission in the right places that de-bottleneck access so that when they run, they displace emitting resources?" Gundlach said. "It's not just a matter of building a transmission line to a renewable facility — it's also a matter of reconfiguring your system so you are assured … you are able to deliver the power they generate wherever there is demand, and by doing so, you make them available to compete against a likely expensive, higher-emitting legacy system."

"Drip pricing is really not good for anyone — it creates a race to the bottom, where all ticket sellers feel like they have to advertise deceptively low fees or they'll lose out to those who do," said Max Sarinsky, a senior attorney at the Institute for Policy Integrity at New York University. "It's not the kind of problem that can solve itself, because it requires all actors to behave well." Last year, the institute asked the Federal Trade Commission, which has the authority to crack down on misleading and deceptive business practices, to ban drip pricing. Its petition garnered support from a number of consumer rights groups and event ticket sellers.

In response to investor demand, the SEC recently proposed a rule that would require publicly traded companies to share information about their exposure to climate-related financial risks. However, this common-sense rule is not without controversy. Since the Supreme Court applied the major questions doctrine in an important climate decision a few weeks ago, critics of the proposed rule have been arguing that it is relevant here too. But the climate-risk disclosure rule is clearly outside of the scope of the major questions doctrine. Far from being transformative or extraordinary, the SEC’s proposed rule is a run-of-the-mill use of the SEC’s authority with ample precedent.

Why would the Court’s conservative majority bother striking down a dead rule? There are two potential reasons—one that creates a barrier for future power-sector rules, and another that looms as a potential threat to a broader swath of other climate and public safeguards.

In October, the Supreme Court will start swinging a conservative legal sledge hammer called the “major questions doctrine,” at every government sector that traffics in regulation. “The major questions doctrine didn't exist until fairly recently, but in the last year or so, the Supreme Court has made it a regular part of its anti-regulatory arsenal,” Richard Revesz of the Institute for Policy Integrity at NYU Law School told the Washington Post last week. “As a result, I am sure that enterprising attorneys general for red states will use it to challenge climate regulations, environmental regulations and all kinds of other regulations.”

In the summer 2022 issue of Regulation, Adler writes a review of Reviving Rationality: Saving Cost-Benefit Analysis for the Sake of the Environment and Our Health by Michael A. Livermore and Richard L. Revesz. Reviving Rationality is something of a sequel to their prior book on cost-benefit analysis, Retaking Rationality: How Cost-Benefit Analysis Can Better Protect the Environment and Our Health. In the first book (which he also reviewed), Livermore and Revesz made the case for cost-benefit analysis as a tool of progressive government. In Reviving Rationality, they note how the Obama Administration (largely) followed their advice and critique the Trump Administration for abandoning principled cost-benefit analysis in regulatory policy.

One potential consequence, that each panelist feared could happen, would be more rulings based on the Major Questions doctrine. This would be a big change for the Court. On this point, Dena Adler from NYU stated, “Until recently, this interpretive framework was little-used, and it remains poorly defined.”

Dr. Burçin Ünel, the Energy Policy Director at the Institute for Policy Integrity, joined three other panelists to discuss why the current pricing system doesn’t work and explore ways regulators and utilities can reimagine electricity tariff structures to better price DERs and encourage more efficient electricity use.